WARRANT PURCHASE AGREEMENT
This Agreement dated as of November 3, 1995 is entered into
by and between Great Bay Power Corporation, a New Hampshire
corporation (the "Company"), and PECO Energy Company, a
Pennsylvania corporation (the "Purchaser").
In consideration of the mutual promises and covenants con-
tained in this Agreement, the parties hereto agree as follows:
1. Authorization and Sale of the Warrant.
1.1. Authorization. The Company has, or on or before
the Closing (as defined in Section 2.2) will have, duly authorized
the sale and issuance of a Warrant (the "Warrant") to purchase
four hundred twenty thousand (420,000) shares of the Company's
common stock, $.01 par value per share (the "Warrant Shares"), at
a price per share equal to the greater of (x) $9.75 per share and
(y) the highest price at which a share of the Company's common
stock, $.01 par value per share (the "Common Stock"), has traded
on the National Association of Securities Dealers National Market
(the "National Market") from the Approval Date, as defined in the
Warrant, to the date on which the Warrant is exercised (the
"Exercise Price"), and on such other terms and in the form
attached hereto as Exhibit A.
As of the date of this Agreement, the Company does not have
sufficient authorized shares of Common Stock for issuance upon
exercise of the Warrant. The Company's board of directors has
approved for submission to the Company's shareholders, at its next
shareholders meeting, an amendment to the Company's certificate of
incorporation to increase the number of authorized shares of the
Company's Common Stock by an amount sufficient to permit the
Company to reserve the Warrant Shares for issuance pursuant to the
Warrant in the event of exercise thereof (the "Charter
Amendment"). If the Charter Amendment is not approved on or
before May 31, 1996, as the Purchaser's sole and exclusive remedy,
the Company shall promptly repay to the Purchaser the Purchase
Price with interest thereon from the date hereof until paid in
full at a rate per annum equal to 110% of the prime rate announced
by The Chase Manhattan Bank (National Association) or its
successor, from time to time and this Agreement shall be of no
further force and effect.
1.2. Sale of Warrant. Subject to the terms and
conditions of this Agreement, at the Closing the Company will sell
and issue to the Purchaser, and the Purchaser will buy the Warrant
for a purchase price of one million dollars ($1,000,000) (the
"Purchase Price"). If the Warrant is exercised, the Purchase
Price shall be applied as a credit against the Exercise Price. If
the Warrant is not exercised, the Company shall retain the
Purchase Price; provided however, if (a) Purchaser properly
terminates the Services Agreement, as defined in Section 5.7
below, pursuant to Section 16(a)(iii) of the Services Agreement,
(b) the Company terminates the Services Agreement pursuant to
Section 16(b), or (c) the Approval Date, as defined in the Warrant
does not occur on or before May 31, 1996, the Company shall refund
to Purchaser the Purchase Price, together with interest accrued
thereon at the rate set forth in Section 1.1 above; and provided
further, if Purchaser terminates the Services Agreement because
the Company ordered the Purchaser to make a Great Bay Directed
Offer, as that term is defined in the Services Agreement, the
Company shall refund a portion of the Purchase Price to Purchaser
in an amount equal to the product of the Purchase Price and a
fraction, the numerator of which is the number of days from the
date upon which notice of termination is presented to the Company
by Purchaser in accordance with Section 16(b) of the Services
Agreement through September 30, 1996, and the denominator of which
is the number of days from the Service Commencement Date, as
defined in the Services Agreement, through September 30, 1996.
If the Company requires Purchaser to establish a
separate trust account to hold Gross Receipts pursuant to Section
4(e) of the Services Agreement and there still is present a
circumstance which could entitle Purchaser to a refund of all or a
portion of the Purchase Price pursuant to this Section 1.2, the
Company shall, at Purchaser's request, deposit the Purchase Price
into a separate trust account which will be payable to Purchaser
if Purchaser is so entitled under this Section 1.2. Such account
will be established on the same or similar terms on which the
trust account is established pursuant to the Services Agreement.
The cost of such account shall be paid by Purchaser.
The Warrant Expiration Date shall mean the earliest to
occur of the following: (1) September 30, 1996, if the Seabrook
Capacity Factor for the period from the Service Commencement Date
through September 15, 1995 is equal to or greater than 60%; (2)
December 31, 1996, if the Seabrook Capacity Factor for the period
from the Service Commencement Date through December 15, 1996 is
equal to or greater than 60%; (3) two (2) business days following
the first date after December 31, 1996 that the Seabrook Capacity
Factor for the immediately preceding twelve months is equal to or
greater than 60%; or (4) December 31, 1997. Service Commencement
Date and Seabrook Capacity Factor shall have the respective
meanings ascribed to such terms in the Services Agreement.
2. The Closing.
2.1. In General. The closing ("Closing") of the sale
and purchase of the Warrant under this Agreement shall take place
at the offices of ▇▇▇▇ and ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇, at 10:00 a.m. on the second business day following
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delivery by the Company to Purchaser of notice that the conditions
to closing specified in Section 5 have been satisfied, or at such
other time and place as is mutually agreeable to the Company and
the Purchaser. At the Closing, the Company will deliver to the
Purchaser the Warrant to be registered in the name of the
Purchaser, against payment to the Company of the Purchase Price
therefor, by wire transfer or other method acceptable to the
Company. The date of the Closing is hereinafter referred to as
the "Closing Date."
3. Representations of the Company. The Company hereby
represents and warrants to the Purchaser as of the date hereof as
follows:
3.1. Organization and Standing. The Company is a
corporation duly organized, validly existing and in good standing
under the laws of the State of New Hampshire and has full
corporate power and authority to conduct its business as presently
conducted and as proposed to be conducted by it and except as
otherwise disclosed in this Agreement, to enter into and perform
this Agreement and to carry out the transactions contemplated by
this Agreement.
3.2. Capitalization. The authorized capital stock of
the Company consists of 8,000,000 shares of Common Stock of which
7,999,998 shares are issued and outstanding. All of such issued
and outstanding shares of Common Stock have been duly authorized
and validly issued and are fully paid and nonassessable. Except
as provided in this Agreement, (i) no subscription, warrant,
option (other than the options to purchase 455,000 shares of
Common Stock which are currently outstanding and which were
granted pursuant to the Company's 1995 Stock Option Plan),
convertible security or other right (contingent or otherwise) to
purchase or acquire any shares of capital stock of the Company is
authorized or outstanding, (ii) there is not any commitment of the
Company to issue any subscription, warrant, option, convertible
security or other such right or to issue or distribute to holders
of any shares of its capital stock any evidences of indebtedness
or assets of the Company, and (iii) the Company has no obligation
(contingent or otherwise) to purchase, redeem or otherwise acquire
any shares of its capital stock or any interest therein or to pay
any dividend or make any other distribution in respect thereof.
No person or entity is entitled to (i) any preemptive or similar
right with respect to the issuance of any capital stock of the
Company, or (ii) except as provided in this Agreement and for
rights granted to the parties listed on Schedule 3.2 to register
such persons' shares under the Securities Act, any rights with
respect to the registration of any capital stock of the Company
under the Securities Act.
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3.3. Subsidiaries. The Company has no subsidiaries and
does not own or control, directly or indirectly, any other corpo-
ration, association or business entity. The Company is not a
participant in any joint venture or partnership.
3.4. Issuance of Warrant. The issuance, sale and
delivery of the Warrant in accordance with this Agreement has
been, or will be on or prior to the Closing, duly authorized by
all necessary corporate action on the part of the Company. Upon
approval of the Charter Amendment, the issuance of the Warrant
Shares pursuant to the terms of the Warrant will be duly
authorized by all necessary corporate action on the part of the
Company and when issued and paid for in accordance with the terms
of the Warrant will be duly and validly issued, fully paid and
nonassessable.
3.5. Authority for Agreement. Subject to shareholder
approval of the Charter Amendment, the execution, delivery and
performance by the Company of this Agreement and the consummation
by the Company of the transactions contemplated hereby have been
duly authorized by all necessary corporate action, and this
Agreement has been duly executed and delivered by the Company.
This Agreement constitutes the valid and binding obligation of the
Company enforceable in accordance with its terms. Subject to
shareholder approval of the Charter Amendment, the execution of
and performance of the transactions contemplated by this Agreement
and compliance with its provisions by the Company will not violate
any provision of law and will not, with or without the passage of
time, conflict with or result in any breach of any of the terms,
conditions or provisions of, or constitute a default under, its
Restated Certificate of Incorporation, as amended (the "Restated
Certificate"), or its Amended and Restated By-Laws or any
indenture, lease, agreement or other instrument to which the
Company is a party or by which it or any of its properties is
bound, or any decree, judgment, order, statute, rule or regulation
applicable to the Company.
3.6. Governmental Consents. Except for approval of the
New Hampshire Public Utility Commission with respect to the
issuance of the Warrant and Warrant Shares, no consent, approval,
order or authorization of, or registration, qualification,
designation, declaration or filing with, any governmental
authority is required on the part of the Company in connection
with the execution and delivery of this Agreement, or the offer,
issuance, sale and delivery of the Warrant. Based on the
representations made by the Purchaser in Section 4 of this
Agreement, the offer, sale and issuance of the Warrant to the
Purchaser will be in compliance with applicable federal and state
securities laws.
3.7. Commission Filings. Copies of all documents
(including exhibits, but excluding exhibits incorporated by
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reference) filed by the Company with the Commission pursuant to
the Exchange Act since April 17, 1994 (the "Commission Filings"),
have been delivered to Purchaser. The Commission Filings, all of
which were filed on a timely basis, (i) were prepared, in all
material respects, in accordance with the requirements of the
Exchange Act and the rules and regulations thereunder, (ii) did
not at the time they were filed contain any untrue statement of
material fact, and (iii) did not at the time they were filed omit
to state a material fact necessary to make the statements therein,
in light of the circumstances in which they were made, not
misleading. Each of the audited financial statements and
unaudited interim financial statements (including any related
notes or schedules) included in the Commission Filings was
prepared in accordance with generally accepted accounting
principles applied on a consistent basis, except as may be
indicated therein or in the notes or schedules thereto (any such
schedules being prepared in accordance with Regulation S-X), and
fairly presented in all material respects the financial position
of the Company as at the dates thereof and the results of its
operations and cash flows for the periods then ended, subject, in
the case of the unaudited interim financial statements, to normal
year-end audit adjustments and the absence of complete notes.
3.8. Litigation. There are no action, suits, or
proceedings pending or, to its knowledge, threatened against, or
affecting the Company in any court or before any governmental
commission, which seeks to enjoin the Closing of this Agreement or
which challenges the validity of the Company's obligations
hereunder.
4. Representations of the Purchaser. The Purchaser
represents and warrants to the Company as follows:
4.1. Investment. The Purchaser is acquiring the Warrant
and intends to acquire the Warrant Shares issuable upon exercise
of the Warrant for its own account for investment and not with a
view to, or for resale in connection with, any distribution or
public offering thereof (within the meaning of the Securities Act
of 1933, as amended (the "Securities Act"), nor with any present
intention of distributing or selling the same; and, the Purchaser
has no present or contemplated agreement, undertaking,
arrangement, obligation, indebtedness or commitment providing for
the disposition thereof.
4.2. Authority. The Purchaser has full corporate power
and authority to enter into and to perform this Agreement in
accordance with its terms. The Purchaser has not been organized,
reorganized or recapitalized specifically for the purpose of
investing in the Company.
4.3. Experience. The Purchaser has carefully reviewed
the Commission Filings and the Joint Ownership Agreement among the
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owners of Seabrook, as amended, and the representations concerning
the Company contained in this Agreement and the Services Agreement
and has made detailed inquiry concerning the Company, its business
and its personnel; the officers of the Company have made available
to the Purchaser the opportunity to ask questions and receive
answers concerning the terms and conditions of the offering of the
Warrant made hereby and to obtain any additional information that
the Company possesses or can acquire without unreasonable effort
or expense that is necessary to verify the accuracy of information
provided by the Company to Purchaser; in evaluating the
suitability of an investment in the Company, the Purchaser has not
relied upon any representations or other information (whether oral
or written) other than as set forth in the Commission Filings and
the Joint Ownership Agreement among the Joint Owners of Seabrook,
as amended, or in this Agreement and the Services Agreement.
4.4. Accredited Investor. The Purchaser is an
Accredited Investor within the definition set forth in Securities
Act Rule 501(a).
5. Conditions to the Obligations of the Purchaser. The
obligation of the Purchaser to purchase the Warrant at the Closing
is subject to the fulfillment, or the waiver by the Purchaser, of
the following conditions on or before the Closing Date:
5.1. Accuracy of Representations and Warranties. Each
representation and warranty contained in Section 3 shall be true
on and as of such Closing Date with the same effect as though such
representation and warranty had been made on and as of that date.
5.2. Performance. The Company shall have performed and
complied with all agreements and conditions contained in this
Agreement required to be performed or complied with by it prior to
or at the Closing.
5.3. Opinion of Counsel. The Purchaser shall have
received an opinion from ▇▇▇▇ and ▇▇▇▇, counsel for the Company,
dated the Closing Date, addressed to the Purchaser at the Closing
as to the corporate good standing of the Company and, subject to
shareholder approval of the Charter Amendment, the due
authorization of this Agreement and of the Warrant, the lack of
conflicts between this Agreement and other agreements to which the
Company is a party and applicable law, that New Hampshire Public
Utility Commission approval has been obtained for the issuance of
the Warrant and the Warrant Shares and the enforceability of this
Agreement and the Warrant.
5.4. Certificates and Documents. The Company shall have
delivered to the Purchaser:
(a) Certificates, as of the most recent
practicable dates, as to the corporate good standing of the
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Company issued by the Secretary of State of the State of New
Hampshire, confirming such good standing within five business days
of the Closing Date;
(b) Amended and Restated By-laws of the Company,
certified by its Secretary or Assistant Secretary as of the
Closing Date; and
(c) Resolutions of the Board of Directors
authorizing and approving all matters in connection with this
Agreement and the transactions contemplated hereby, certified by
the Secretary or Assistant Secretary of the Company as of such
Closing Date.
5.5. Stockholder Approval. Purchaser shall have
received from the persons listed on Schedule 3.2 their respective
undertaking to vote those shares of the Company's Common Stock
which each owns as of the record date for the shareholders meeting
at which the Charter Amendment is submitted for approval in favor
of the Charter Amendment.
5.6. Compliance Certificate. The Company shall have
delivered to the Purchaser a certificate, executed by the Chairman
or the President of the Company, dated the Closing Date,
certifying to the fulfillment of the conditions specified in
subsections 5.1 and 5.2 this Agreement.
5.7. Services Agreement. The Company and the Purchaser
shall have entered into a service agreement (the "Services
Agreement") providing for Purchaser to act as the Company's
marketing agent in the form attached hereto as Exhibit C.
5.8. Other Matters. All corporate and other proceedings
in connection with the transactions contemplated by this Agreement
and all documents and instruments incident to such transactions
shall be reasonably satisfactory in substance and form to the
Purchaser and the Purchaser shall have received all such
counterpart originals or certified or other copies of such
documents as it may reasonably request.
5.9. Regulatory Approval. The Company shall have
received a final order of the New Hampshire Public Utilities
Commission approving and authorizing the sale of the Warrant and
issuance of the Warrant Shares and to the extent required,
approval of the Charter Amendment.
6. Conditions to the Obligations of the Company. The obli-
gations of the Company to sell the Warrant to Purchaser on the
Closing Date are subject to fulfillment, on or before the Closing
Date, of each of the following conditions:
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6.1. Accuracy of Representations and Warranties. The
representations and warranties of the Purchaser contained in
Section 4 shall be true on and as of such Closing Date with the
same effect as though such representations and warranties had been
made on and as of that date.
6.2. Regulatory Approval. The Company shall have
received a final order of the New Hampshire Public Utilities
Commission approving and authorizing the sale of the Warrant,
issuance of the Warrant Shares and the Charter Amendment.
7. Covenants of Purchaser and the Company.
7.1. Restriction on Sale of Warrant Shares. If and for
so long as the Purchaser owns 5% or more of the Company's Voting
Securities and no person together with its Affiliates or
Associates owns 50% or more of the Voting Securities, the
Purchaser shall not sell (i) Voting Securities which represent 5%
or more of the total of the Voting Securities to any person or
group; and (ii) Voting Securities to any person or group which
holds or would hold after giving effect to the proposed sale 5% of
the Voting Securities.
7.2. Repurchase of Warrant Shares. If Purchaser
purchases the Warrant Shares and during the period following such
purchase and prior to Purchaser's right to demand registration of
the Warrant Shares pursuant to Section 8.3 below the Company
engages in a transaction that would result in the Purchaser owning
5% or more of the Company's issued and outstanding Common Stock
(and not as a result of Purchaser purchasing additional shares of
Common Stock) the Company agrees to purchase from Purchaser, at
Purchaser's request, sufficient shares (the "Repurchased Shares")
so that Purchaser will own no more than 4.99% of the Company's
issued and outstanding shares after giving effect to such
transaction. The Company will give Purchaser prior written notice
of a transaction that would result in Purchaser owning 5% or more
of the Company's issued and outstanding shares not less than 30
days prior to the closing date for such transaction. Purchaser
shall give the Company written notice within 10 days of receipt of
such notice whether it will require the Company to purchase the
Repurchased Shares. The Company shall purchase the Repurchased
Shares at the same time the transaction giving rise to the
Company's obligation hereunder is closed (the "Purchase Date").
If the transaction giving rise to the Company's obligation to
purchase the Repurchased Shares has a fixed price at which the
Company's Common Stock is valued, the purchase price for the
Repurchased Shares shall be such price. If no such price is
fixed, the purchase price for the Repurchased Shares shall equal
the average of the closing prices for the Company's Common Stock
on trades of such Common Stock on the National Market for 20
business days prior to the Purchase Date. Purchaser shall be
required to tender good title to the Repurchased Shares against
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payment therefor. The Company's obligation hereunder shall cease
and be of no further force and effect if Purchaser purchases
additional shares of Common Stock which cause it to own 5% or more
of the Company's issued and outstanding shares of Common Stock.
8. Registration Rights.
8.1. Certain Definitions. As used in this Section 8 and
elsewhere in this Agreement, the following terms shall have the
following respective meanings:
"Commission" means the Securities and Exchange
Commission, or any other Federal agency at the time administering
the Securities Act.
"Exchange Act" means the Securities Exchange Act of
1934, as amended, or any similar Federal statute, and the rules
and regulations of the Commission issued under such Act, as they
each may, from time to time, be in effect.
"Registration Statement" means a registration
statement filed by the Company with the Commission for a public
offering and sale of securities of the Company (other than a
registration statement on Form S-8 or Form S-4, or their succes-
sors, or any other form for a limited purpose, or any registration
statement covering only securities proposed to be issued in
exchange for securities or assets of another corporation).
"Registration Expenses" means the expenses
described in Section 8.6.
"Registrable Shares" means the Warrant Shares and
shares issued in respect thereof (because of stock splits, stock
dividends, reclassifications, recapitalizations or similar
events); provided, however, the Warrant Shares shall cease to be
Registrable Shares (i) upon any sale pursuant to a Registration
Statement, Section 4(1) of the Securities Act or Rule 144 under
the Securities Act, or any sale in any manner to a person or
entity which, by virtue of Section 9(b) of this Agreement, is not
entitled to the rights provided by this Section 8 and (ii) at such
time as they first become eligible for resale pursuant to Rule
144(k) under the Securities Act. Whenever reference is made in
this Agreement to a request or consent of holders of a certain
percentage of Registrable Shares, the determination of such
percentage shall include Warrant Shares issuable upon exercise of
the Warrant even if the Warrant has not yet been exercised.
"Securities Act" means the Securities Act of 1933,
as amended, or any similar Federal statute, and the rules and
regulations of the Commission issued under such Act, as they each
may, from time to time, be in effect.
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8.2. Sale or Transfer of the Warrant and Registrable
Shares; Legend.
(a) The Warrant may only be transferred to the
extent permitted by Section 9(b) of the Warrant. The Registrable
Shares shall not be sold or transferred unless either (i) they
first shall have been registered under the Securities Act, or
(ii) the Company first shall have been furnished with an opinion,
in form and substance satisfactory to the Company, of legal
counsel satisfactory to the Company to the effect that such sale
or transfer is exempt from the registration requirements of the
Securities Act.
(b) Each certificate representing Registrable
Shares shall bear the following legend:
"The securities represented by this
certificate have not been registered under
the Securities Act of 1933, as amended, and
may not be offered, sold or otherwise
transferred, pledged or hypothecated unless
and until such securities are registered
under such Act or an opinion, in form and
substance satisfactory to the Company, of
counsel satisfactory to the Company is ob-
tained to the effect that such sale or
transfer is exempt from the registration
requirements of the Securities Act."
The foregoing legend shall be removed from the
certificates representing any of such securities, at the request
of the holder thereof, at such time as they become eligible for
resale pursuant to Rule 144(k) under the Securities Act or upon
registration.
8.3. Required Registrations.
(a) If at any time after the earlier of
termination in accordance with its terms of the Services Agreement
or September 30, 1998, the Registrable Shares are not eligible and
continue to be ineligible for resale pursuant to Rule 144(k) a
holder or holders of an aggregate of at least 51% of the
Registrable Shares may request, in writing, that the Company
effect the registration on Form S-3 (or any successor form) of
Registrable Shares owned by such holder or holders having an
aggregate offering price of at least $500,000 (based on the then
current market price). If the holders initiating the registration
intend to distribute the Registrable Shares by means of an
underwriting, they shall so advise the Company in their request.
In the event such registration is underwritten, the right of other
holders of Registrable Shares to participate shall be conditioned
on such holders' participation in such underwriting. Upon receipt
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of any such request, the Company shall promptly give written
notice of such proposed registration to all holders of Registrable
Shares. Such holders of Registrable Shares shall have the right,
by giving written notice to the Company within 20 days after the
Company provides its notice, to elect to have included in such
registration such of their Registrable Shares as such holders may
request in such notice of election, subject to the approval of the
underwriter managing the offering as provided below. Thereupon,
the Company shall, as expeditiously as possible, use reasonable
commercial efforts to effect the registration, on Form S-3 (or any
successor form), of all Registrable Shares which the Company has
been requested to so register.
Notwithstanding any other provision of this
Section 8.3, if the distribution of Registrable Shares is to be
effected by means of an underwriting and the managing underwriter
advises the holders of Registrable Shares initiating the
registration in writing that marketing factors require a
limitation of the number of shares to be underwritten, then the
holders of Registrable Shares initiating the registration shall so
advise all holders of Registrable Shares which would otherwise be
included in the underwriting and the number of Registrable Shares
that may be included in the underwriting shall be allocated among
all such holders of Registrable Shares, including the holders of
Registrable Shares initiating the registration, in proportion (as
nearly as practicable) to the amount of Registrable Shares owned
by each such holder. If the distribution of Registrable Shares is
to be effected by means of an underwriting and the managing
underwriter does not limit the number of Registrable Shares to be
underwritten, the Company or other holders of securities of the
Company who have registration rights similar to those set forth in
Section 8.4 hereof may include Common Stock for their respective
accounts in such registration if the managing underwriter states
that such inclusion would not adversely effect the offering of
Registrable Shares and if the number of Registrable Shares which
would otherwise have been included in such registration and
underwriting will not thereby be limited or reduced.
(b) The Company shall not be required to effect
more than one registration pursuant to paragraph (a) above. In
addition, the Company shall not be required to effect any
registration within six months after the effective date of any
other Registration Statement of the Company.
(c) If at the time of any request to register
Registrable Shares pursuant to this Section 8.3, the Company is
engaged or has fixed plans to engage within 30 days of the time of
the request in a registered public offering as to which the
holders of Registrable Shares may request to include Registrable
Shares pursuant to Section 8.4 or is engaged in any other activity
which, in the good faith determination of the Company's Board of
Directors, would be adversely effected by the requested
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registration to the material detriment of the Company, then the
Company may at its option direct that such request be delayed for
a period not in excess of six months from the effective date of
such offering or the date of commencement of such other material
activity, as the case may be.
8.4. Incidental Registration.
(a) Until the tenth anniversary of the date of
this Agreement, if the Company proposes to file a Registration
Statement (other than pursuant to Section 8.3) covering the sale
of shares of Common Stock by the Company at any time or from time
to time, it will, prior to such filing, give written notice to all
holders of Registrable Shares of its intention to do so and, upon
the written request of a holder or holders of Registrable Shares
given within 20 days after the Company provides such notice (which
request shall state the intended method of disposition of such
Registrable Shares), the Company shall use reasonable commercial
efforts to cause all Registrable Shares which the Company has been
requested by such holder or holders to register to be registered
under the Securities Act to the extent necessary to permit their
sale or other disposition in accordance with the intended methods
of distribution specified in the request of such holder or
holders; provided that the Company shall have the right to
postpone or withdraw any registration effected pursuant to this
Section 8.4 without obligation to any holder of Registrable
Shares. Notwithstanding anything in the foregoing to the
contrary, the Company shall not be required to provide such
advance notice in connection with, nor include any Registrable
Shares in, any offering under this Section 8.4 involving an
underwriting if the Company has been informed that in the opinion
of the managing underwriter, the registration of any Registrable
Shares would jeopardize the success of the offering by the
Company. In such event, the Company will provide written notice
to all holders of Registrable Shares of such managing
underwriter's opinion. Such notice need not be given prior to the
filing of the applicable Registration Statement.
(b) In connection with any offering under this
Section 8.4 involving an underwriting, the Company shall not be
required to register any Registrable Shares or include any
Registrable Shares in such underwriting unless the holders thereof
accept the terms of the underwriting as agreed upon between the
Company and the underwriters selected by it, and then only in such
quantity as will not, in the opinion of the managing underwriter,
adversely effect the offering of shares to be included in the
underwriting by the Company and by the holders of registration
rights pursuant to a Registration Rights Agreement between the
Company and certain shareholders of the Company (the "Senior
Shareholders") dated as of April 7, 1994, as amended on November
23, 1994. If in the opinion of the managing underwriter, after
giving effect to the priority rights of the Company and the Senior
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Shareholders as provided in the previous sentence, the
registration of all of the Registrable Shares which the holders
have requested to be included would adversely effect the offering
by the Company and/or the Senior Shareholders, then the Company
shall be required to include in the underwriting only that number
of Registrable Shares, if any, which the managing underwriter
believes may be sold without causing such adverse effect. If the
number of Registrable Shares to be included in the underwriting in
accordance with the foregoing is less than the total number of
shares which the holders of Registrable Shares have requested to
be included, then the holders of Registrable Shares who have
requested registration and other holders of securities entitled to
be included in such registration (other than the Senior
Shareholders, who shall have the priority rights specified above)
shall participate in the underwriting: pro rata based upon their
total ownership of shares of Common Stock of the Company (giving
effect to the conversion into Common Stock of all securities
convertible thereinto and the exercise for Common Stock of all
shares exercisable therefor). If any holder of Registrable Shares
would thus be entitled to include more shares than such holder
requested to be registered, the excess shall be allocated among
other requesting holders of Registrable Shares pro rata in the
manner described in the preceding sentence.
8.5. Registration Procedures. If and whenever the
Company is required by the provisions of this Agreement to use
reasonable commercial efforts to effect the registration of any of
the Registrable Shares under the Securities Act, the Company
shall:
(a) use reasonable commercial efforts to file
with the Commission a Registration Statement with respect to such
Registrable Shares and to cause that Registration Statement to
become and remain effective for a period of not less than 90 days
or until all shares covered by the registration statement have
been sold;
(b) as expeditiously as possible prepare and file
with the Commission any amendments and supplements to the Regis-
tration Statement and the prospectus included in the Registration
Statement as may be necessary to keep the Registration Statement
effective for the period described in Section 8.5(a);
(c) as expeditiously as possible furnish to each
holder of Registrable Shares who is selling shares pursuant to
such registration (a "Selling Holder") such reasonable numbers of
copies of the prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such
other documents as the Selling Holder may reasonably request in
order to facilitate the public sale or other disposition of the
Registrable Shares owned by the Selling Holder; and
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(d) as expeditiously as possible use reasonable
commercial efforts to register or qualify the Registrable Shares
covered by the Registration Statement under the securities or Blue
Sky laws of such states as the Selling Holders shall reasonably
request, and do any and all other acts and things that may be
necessary or desirable to enable the Selling Holders to consummate
the public sale or other disposition in such states of the
Registrable Shares owned by the Selling Holders; provided,
however, that the Company shall not be required in connection with
this paragraph (d) to qualify as a foreign corporation or execute
a general consent to service of process in any jurisdiction.
If the Company has delivered preliminary or final
prospectuses to the Selling Holders and after having done so the
prospectus is amended to comply with the requirements of the
Securities Act, the Company shall promptly notify the Selling
Holders and, if requested, the Selling Holders shall immediately
cease making offers of Registrable Shares and return all
prospectuses to the Company. The Company shall promptly provide
the Selling Holders with revised prospectuses and, following
receipt of the revised prospectuses, the Selling Holders shall be
free to resume making offers of the Registrable Shares with such
revised prospectuses.
8.6. Allocation of Expenses. The Company will pay all
Registration Expenses of all registrations under this Agreement;
provided, however, that if a registration is withdrawn at the
request of the holders of Registrable Shares requesting such
registration, the requesting holders shall pay the Registration
Expenses of such registration pro rata in accordance with the
number of their Registrable Shares included in such registration.
For purposes of this Section, the term "Registration Expenses"
shall mean all expenses incurred by the Company in complying with
a request to register Registrable Shares pursuant to Section 8 of
this Agreement including, without limitation, all registration and
filing fees, exchange listing fees, printing expenses, fees and
disbursements of counsel for the Company and the fees and expenses
of one counsel selected by the Selling Holders to represent the
Selling Holders, state Blue Sky fees and expenses, and the expense
of any special audits incident to or required by any such
registration, but excluding underwriting discounts, selling
commissions and the fees and expenses of the Selling Holders' own
counsel (other than the one counsel selected to represent all of
the Selling Holders).
8.7. Indemnification. In the event of any registration
of any of the Registrable Shares under the Securities Act pursuant
to Section 8 of this Agreement, the Company will indemnify and
hold harmless the seller of such Registrable Shares, each
underwriter of such Registrable Shares, and each other person, if
any, who controls such seller or underwriter within the meaning of
the Securities Act or the Exchange Act against any losses, claims,
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damages or liabilities, joint or several, to which such seller,
underwriter or controlling person may become subject under the
Securities Act, the Exchange Act, state securities or Blue Sky
laws or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any
material fact contained in any Registration Statement under which
such Registrable Shares were registered under the Securities Act,
any preliminary prospectus or final prospectus contained in the
Registration Statement, or any amendment or supplement to such
Registration Statement, or arise out of or are based upon the
omission or alleged omission to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading; and the Company will reimburse such seller, under-
writer and each such controlling person for any legal or any other
expenses reasonably incurred by such seller, underwriter or
controlling person in connection with investigating or defending
any such loss, claim, damage, liability or action; provided,
however, that the Company will not be liable in any such case to
the extent that any such loss, claim, damage or liability arises
out of or is based upon any untrue statement or omission made in
such Registration Statement, preliminary prospectus or prospectus,
or any such amendment or supplement, in reliance upon and in con-
formity with information furnished to the Company by or on behalf
of such seller, underwriter or controlling person specifically for
use in the preparation thereof.
In the event of any registration of any of the
Registrable Shares under the Securities Act pursuant to Section 8
of this Agreement, each seller of Registrable Shares, severally
and not jointly, will indemnify and hold harmless the Company,
each of its directors and officers and each underwriter (if any)
and each person, if any, who controls the Company or any such
underwriter within the meaning of the Securities Act or the
Exchange Act, against any losses, claims, damages or liabilities,
joint or several, to which the Company, such directors and
officers, underwriter or controlling person may become subject
under the Securities Act, Exchange Act, state securities or Blue
Sky laws or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement under which
such Registrable Shares were registered under the Securities Act,
any preliminary prospectus or final prospectus contained in the
Registration Statement, or any amendment or supplement to the
Registration Statement, or arise out of or are based upon any
omission or alleged omission to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, if the statement or omission was made in reliance upon
and in conformity with information furnished to the Company by or
on behalf of such seller, specifically for use in connection with
the preparation of such Registration Statement, prospectus,
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amendment or supplement; provided, however, that the obligations
of such seller of Registrable Shares hereunder shall be limited to
an amount equal to the proceeds to such seller of Registrable
Shares from the sale of Registrable Shares as contemplated herein.
Each party entitled to indemnification under this Sec-
tion 8.7 (the "Indemnified Party") shall give notice to the party
required to provide indemnification (the "Indemnifying Party")
promptly after such Indemnified Party has actual knowledge of any
claim as to which indemnity may be sought, and shall permit the
Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom; provided, that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or
litigation, shall be approved by the Indemnified Party (whose ap-
proval shall not be unreasonably withheld). The Indemnified Party
may participate in such defense at such party's expense; provided,
however, that the Indemnifying Party shall pay such expense if
representation of such Indemnified Party by the counsel retained
by the Indemnifying Party would be inappropriate due to actual or
potential differing interests between the Indemnified Party and
any other party represented by such counsel in such proceeding.
No Indemnifying Party, in the defense of any such claim or
litigation shall, except with the consent of each Indemnified
Party, consent to entry of any judgment or enter into any settle-
ment which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party of a
release from all liability in respect of such claim or litigation,
and no Indemnified Party shall consent to entry of any judgment or
settle such claim or litigation without the prior written consent
of the Indemnifying Party.
8.8. Indemnification with Respect to Underwritten Of-
fering. In the event that Registrable Shares are sold pursuant to
a Registration Statement in an underwritten offering pursuant to
Section 8.3(a), the Company agrees to enter into an underwriting
agreement containing customary representations and warranties with
respect to the business and operations of an issuer of the securi-
ties being registered and customary covenants and agreements to be
performed by such issuer, including without limitation customary
provisions with respect to indemnification by the Company of the
underwriters of such offering.
8.9. Information by Holder. Each holder of Registrable
Shares included in any registration shall furnish to the Company
such information regarding such holder and the distribution pro-
posed by such holder as the Company may request in writing and as
shall be required in connection with any registration, qualifica-
tion or compliance referred to in this Agreement.
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9. Transfers of Certain Rights.
(a) The rights granted to the Purchaser pursuant to
Section 8 of this Agreement may be transferred by such holder to
another holder of Registrable Shares, to any Affiliate, as defined
in Section 7.1, of such holder or to any person or entity
acquiring at least one hundred thousand (100,000) Registrable
Shares (such number being subject to adjustment for any stock
dividend, stock split, subdivision, combination or other
recapitalization of the Common Stock of the Company); provided,
however, that the Company is given written notice by the
transferee at the time of such transfer stating the name and
address of the transferee and identifying the securities with
respect to which such rights are being assigned.
(b) Transferees. Any transferee (other than the
Purchaser) to whom rights hereunder are transferred shall, as a
condition to such transfer, deliver to the Company a written
instrument by which such transferee agrees to be bound by the
obligations imposed upon the Purchaser and/or holders of
Registrable Shares, as the case may be, under this Agreement to
the same extent as if such transferee were a party hereto.
(c) Subsequent Transferees. A transferee to whom
rights are transferred pursuant to this Section 9 may not again
transfer such rights to any other person or entity, other than as
provided in Sections 9(a) and (b).
10. Confidentiality. The Purchaser and each holder of
Registrable Shares agrees that he or it will keep confidential and
will not disclose or divulge any confidential, proprietary or
secret information which the Purchaser or such holder of
Registrable Shares, as the case may be, may obtain from the
Company pursuant to financial statements, reports and other
materials submitted by the Company to such Purchaser or holder of
Registrable Shares, as the case may be, pursuant to this
Agreement, unless such information is known, or until such
information becomes known, to the public or except as required by
law or judicial or administrative proceeding.
11. Survival of Representations and Warranties. All agree-
ments, representations and warranties contained herein shall
survive the execution and delivery of this Agreement and the
closing of the transactions contemplated hereby.
12. Notices. All notices, requests, consents, and other
communications under this Agreement shall be in writing and shall
be (i) delivered by hand, (ii) mailed by first-class United States
mail, certified or registered mail, return receipt requested,
postage prepaid, (iii) transmitted by telecopy with a hard copy
mailed by first class certified or registered mail as aforesaid;
or (iv) delivered by overnight courier service:
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If to the Company, at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, telecopy number (▇▇▇) ▇▇▇-▇▇▇▇, Attention:
President, or at such other address or addresses as may have been
furnished in writing by the Company to the Purchaser, and/or
holders of Registrable Shares, as the case may be, with a copy to
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq., ▇▇▇▇ and ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, telecopy number 617-526-5000; or
If to the Purchaser, at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇ ▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, telecopy number (▇▇▇) ▇▇▇-▇▇▇▇, or at such
other address or addresses as may have been furnished to the
Company in writing by such Purchaser.
If to a holder of Registrable Shares other than a Purchaser,
at his or its address as it appears on the stock record books of
the Company, or at such other address or addresses as may have
been furnished to the Company in writing by such Stockholder or
holder of Registrable Shares.
Notices provided in accordance with this Section 12 shall be
deemed delivered upon personal delivery or (i) 72 hours after
deposit in the mail, (ii) noon on the second business day next
following deposit with an overnight express courier service and
(iii) in the case of notices provided by telecopy, upon completion
of transmission to the addressee's telecopier.
13. No Assignment. The Warrant may not be assigned except
to the extent permitted by Section 9(b) of the Warrant. The
rights under Section 8 hereof with respect to the Warrant Shares
may only be assigned to the extent permitted by Section 9 hereof.
Except to the extent permitted by the foregoing sentence, the
rights granted pursuant to this Agreement may not be transferred
or assigned by the Purchaser or any holder of Registrable Shares.
Subject to the foregoing, the provisions of this Agreement shall
be binding upon, and inure to the benefit of, the respective
successors, assigns, heirs, executors and administrators of the
parties hereto.
14. Entire Agreement. This Agreement embodies the entire
agreement and understanding between the parties hereto with
respect to the subject matter hereof and supersedes all prior
agreements and understandings relating to such subject matter.
15. Amendments and Waivers. Except as otherwise expressly
set forth in this Agreement, any term of this Agreement may be
amended and the observance of any term of this Agreement may be
waived (either generally or in a particular instance and either
retroactively or prospectively), with the written consent of the
Company and Purchaser and after the Closing the holders of at
least a majority of the Registrable Shares. No waivers of or
exceptions to any term, condition or provision of this Agreement,
in any one or more instances, shall be deemed to be, or construed
-18-
as, a further or continuing waiver of any such term, condition or
provision.
16. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
17. Headings. The headings of the sections, subsections,
and paragraphs of this Agreement have been added for convenience
only and shall not be deemed to be a part of this Agreement.
18. Severability. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or
enforceability of any other provision.
19. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New
Hampshire, without giving effect to conflict of laws provisions.
IN WITNESS WHEREOF, the undersigned have hereunto set their
hands as of the day and year first above written.
GREAT BAY POWER CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: President
PECO ENERGY COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
-19-
EXHIBIT A
THIS WARRANT AND THE SHARES OF COMMON STOCK
ISSUABLE UPON EXERCISE OF THIS WARRANT ARE
SUBJECT TO THE RESTRICTIONS (INCLUDING
RESTRICTIONS IMPOSED UNDER APPLICABLE
SECURITIES LAWS) ON TRANSFER SET FORTH IN
SECTIONS 4 AND 11 OF THIS WARRANT. THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR UNDER
APPLICABLE STATE SECURITIES STATUTES.
Warrant No. 1 Number of Shares: 420,000
(subject to adjustment)
Date of Issuance: November __, 1995
GREAT BAY POWER CORPORATION
Common Stock Purchase Warrant
(Void after September 30, 1996)
Great Bay Power Corporation, a New Hampshire corporation
(the "Company"), for value received, hereby certifies that PECO
Energy Company, a Pennsylania corporation (the "Registered
Holder"), is entitled, subject to the terms set forth below and
the terms of the Warrant Purchase Agreement, upon exercise of this
Warrant to purchase from the Company, at any time on or after the
Approval Date, as hereafter defined, and on or before the Warrant
Expiration Date, as hereafter defined, at not later than 5:00 p.m.
(Boston, Massachusetts time), 420,000 shares of the Company's
Common Stock .01 par value (the "Common Stock") at a purchase
price per share equal to the greater of (x) $9.75 (as adjusted
pursuant to Section 2, the "Fixed Component") and (y) the highest
price at which a share of the Company's Common Stock has traded on
the National Association of Securities Dealers National Market
from the Approval Date to the date on which the Warrant is
exercised (as adjusted pursuant to Section 2, the "Variable
Component").
The 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 Shares" and the "Purchase Price,"
respectively. This Warrant shall be of no further force and
effect, unless the Approval Date occurs on or before May 31, 1996.
Approval Date shall mean the date when an amendment to the
Company's Certificate of Incorporation is filed with the New
Hampshire Secretary of State increasing the number of the
Company's authorized shares of Common Stock to a number sufficient
to permit the Company to reserve the Warrant Shares for issuance
pursuant to this Warrant in the event of exercise by the
Registered Holder.
For purposes of this Warrant, Warrant Expiration Date shall
mean the earliest to occur of the following: (1) September 30,
1996, if the Seabrook Capacity Factor for the period from the
Service Commencement Date through September 15, 1995 is equal to
or greater than 60%; (2) December 31, 1996, if the Seabrook
Capacity Factor for the period from the Service Commencement Date
through December 15, 1996 is equal to or greater than 60%; (3) two
(2) business days following the first date after December 31, 1996
that the Seabrook Capacity Factor for the immediately preceding
twelve months is equal to or greater than 60%; or (4) December 31,
1997. Service Commencement Date and Seabrook Capacity Factor
shall have the respective meanings ascribed to such terms in the
Services Agreement dated November __, 1995, between the Company
and the Registered Holder hereof.
1. Exercise.
(a) This Warrant may be exercised by the Registered
Holder, in whole but not in part, by surrendering this Warrant,
with the purchase form appended hereto as Exhibit I duly executed
by the Registered Holder or by the Registered Holder's duly
authorized attorney, at the principal office of the Company, or at
such other office or agency as the Company may designate,
accompanied by payment in full, in lawful money of the United
States, of the Purchase Price payable in respect of the Warrant
Shares, less $1,000,000.
(b) The exercise of this Warrant shall be deemed to
have been effected immediately prior to the close of business on
the day on which this Warrant shall have been surrendered to the
Company as provided in Section 1(a) above. At such time, the
person or persons in whose name or names any certificates for
Warrant Shares shall be issuable upon such exercise as provided in
Section 1(c) below shall be deemed to have become the holder or
holders of record of the Warrant Shares represented by such
certificates.
(c) As soon as practicable after the exercise of this
Warrant, the Company, at its expense, will cause to be issued in
the name of, and delivered to, the Registered Holder, or as the
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Registered Holder (upon payment by the Registered Holder of any
applicable transfer taxes) may direct a certificate or
certificates for the number of full Warrant Shares to which the
Registered Holder shall be entitled upon such exercise plus, in
lieu of any fractional share to which the Registered Holder would
otherwise be entitled, cash in an amount determined pursuant to
Section 3 hereof.
2. Adjustments.
(a) 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
Fixed Component of 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 Fixed
Component of 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 Fixed Component of the
Purchase Price, the number of Warrant Shares 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 Fixed Component of the Purchase
Price in effect immediately prior to such adjustment, by (ii) the
Fixed Component of the Purchase Price in effect immediately after
such adjustment. At the time of exercise of the Warrant, the
Variable Component of the Purchase Price shall equal the highest
of the Period High Prices, as adjusted pursuant to the last
sentence of this paragraph. Period High Prices means the highest
price at which a share of the Company's Common Stock has traded on
the National Association of Securities Dealers National Market for
each of the following periods: (A) from the Approval Date to the
first adjustment of the Fixed Component; (B) each period from an
adjustment to the Fixed Component to the next such adjustment
following the first adjustment of the Fixed Component; and (C) the
period from the last adjustment to the Fixed Component immediately
prior to the exercise of the Warrant. Each Period High Price
shall be adjusted in the same proportion as the adjustment to the
Fixed Component each time that the Fixed Component was adjusted
subsequent to the time that such Period High Price was in effect.
-3-
(b) 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 Section 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 Registered 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 the
Registered Holder would have been entitled to receive if,
immediately prior to any such reorganization, reclassification,
consolidation, merger or sale, as the case may be, the Registered
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 in good
faith 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 Registered 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) When any adjustment is required to be made in the
Purchase Price, the Company shall promptly mail to the Registered
Holder a certificate setting forth the Purchase Price after such
adjustment and setting forth a brief statement of the facts
requiring such adjustment. 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 Section 2(a) or (b) above.
3. Fractional Shares. The Company shall not be required
upon the exercise of this Warrant to issue any fractional shares,
but shall make an adjustment therefor in cash on the basis of the
mean between the low bid and high asked prices of the Warrant
Shares on the over-the-counter market as reported by the National
Association of Securities Dealers Automated Quotations System or
the closing market price of the Warrant Shares on a national
securities exchange or the last reported sales price on the NASDAQ
National Market on the trading day immediately prior to the date
of exercise, whichever is applicable, or if none is applicable,
then on the basis of the then market value of the Warrant Shares
-4-
as shall be reasonably determined in good faith by the Board of
Directors of the Company.
4. Requirements for Transfer.
(a) This Warrant may only be transferred to the extent
permitted by Section 9(b). The Warrant Shares shall not be sold
or transferred unless either (i) they first shall have been
registered under the Securities Act, or (ii) the Company first
shall have been furnished with an opinion, in form and substance
satisfactory to the Company, of legal counsel satisfactory to the
Company to the effect that such sale or transfer is exempt from
the registration requirements of the Securities Act.
(b) Each certificate representing Warrant Shares shall
bear a legend substantially in the following form:
"The securities represented by this
certificate have not been registered
under the Securities Act of 1933, as
amended, and may not be offered, sold or
otherwise transferred, pledged or
hypothecated unless and until such
securities are registered under such Act
or an opinion, in form and substance
satisfactory to the Company, of counsel
satisfactory to the Company is obtained
to the effect that such sale or transfer
is exempt from the registration
requirements of the Securities Act."
The foregoing legend shall be removed from the certificates
representing any Warrant Shares, at the request of the Registered
Holder, at such time as they become eligible for resale pursuant
to Rule 144(k) under the Securities Act or upon registration.
5. No Impairment. The Company will not, by amendment of
its charter 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.
-5-
6. Notices of Record Date, etc. In case:
(a) the Company shall take a record 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 Registered 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 which 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, or if such advance notice
is not practicable, then such shorter period as may be
practicable, prior to the record date or effective date for an
event specified in Section 6(a), (b) or (c).
7. Reservation of Stock. On and after the Approval Date
the Company will at all times reserve and keep available, solely
for issuance and delivery upon the exercise of this Warrant, such
number of Warrant Shares and other stock, securities and property,
as from time to time shall be issuable upon the exercise of this
Warrant.
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8. 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 (with surety if reasonably required) in an amount
reasonably satisfactory to the Company, or (in the case of
mutilation) upon surrender and cancellation of this Warrant, the
Company will issue, in lieu thereof, a new Warrant of like tenor.
9. Transfers, etc.
(a) The Company will maintain a register containing the
name and address of the Registered Holder of this Warrant. The
Registered Holder may change its 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 but
not in part, solely to an Affiliate, as such term is defined in
Rule 12b-2 under the Securities Exchange Act of 1934, as amended,
of the Registered Holder upon surrender of this Warrant with a
properly executed assignment (in the form of Exhibit II 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.
10. Giving of Notices, etc. All notices and other
communications from the Company to the Registered Holder of this
Warrant shall be in writing and shall be delivered and effective
in accordance with the terms of the Warrant Purchase Agreement
between the Company and Purchaser of even date.
11. No Rights as Stockholder. Until the exercise of this
Warrant, the Registered Holder of this Warrant shall not have or
exercise any rights by virtue hereof as a stockholder of the
Company.
12. 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.
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13. 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.
14. Governing Law. This Warrant will be governed by and
construed in accordance with the internal laws (and not the laws
of conflicts) of the State of New Hampshire.
15. No Third Party Beneficiaries. This Warrant shall not
confer any rights or remedies upon any person other than the
signatories hereto and their respective successors and permitted
assigns.
16. Entire Agreement. Except for the Warrant Purchase
Agreement, this Warrant constitutes the entire agreement among the
signatories hereto and supersedes any prior understandings,
agreements or representations by or among the signatories hereto,
written or oral, that may have related in any way to the subject
matter hereof.
17. Counterparts. This Warrant may be executed in one or
more counterparts, each of which shall be deemed an original but
all of which together shall constitute one and the same
instrument.
18. Nouns and Pronouns. Whenever the context may require,
any pronouns used herein shall include the corresponding
masculine, feminine or neuter forms, and the singular form of
names and pronouns shall include the plural and vice-versa.
19. Severability. Any provision of this Warrant that 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
hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
[Corporate Seal] GREAT BAY POWER CORPORATION
ATTEST: By:____________________________
Title: President
_______________________ Address: ▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇
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AGREED AND ACCEPTED:
PECO ENERGY COMPANY
By:________________________
Title:_____________________
Address:
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EXHIBIT I
PURCHASE FORM
To:_________________ Dated:______________
The undersigned, pursuant to the provisions set forth in the
attached Warrant (No. 1), hereby irrevocably elects to purchase
______ shares of the 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 II
ASSIGNMENT FORM
FOR VALUE RECEIVED, ________________________________________
hereby sells, assigns and transfers all of the rights of the
undersigned under the attached Warrant (No. 1) with respect to all
of the shares of Common Stock covered thereby to the following
person(s):
Name of Assignee Address No. of Shares
The undersigned represents and warrants to Great Bay Power
Company that this assignment of the Warrant is permitted by
Section 9(b) of the Warrant.
Dated:______________ Signature:_______________________________
Dated:______________ Witness:_________________________________
EXHIBIT A
SCHEDULE 3.2
OMEGA CAPITAL PARTNERS L.P.
OMEGA INSTITUTIONAL PARTNERS L.P.
OMEGA OVERSEAS PARTNERS L.P.
COMMON FUND
OMEGA OVERSEAS PARTNERS II LTD.
▇▇▇▇▇▇▇ SACHS & CO. PROFIT SHARING
MASTER TRUST
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO., POOLED ▇▇▇ 2
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ASSOCIATES, L.P.