EXHIBIT 4(b) TO SCHEDULE 13D
▇▇▇▇▇▇▇ CALL AGREEMENT
CALL AGREEMENT (this "Agreement"), dated as of March 23, 1998, between
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇. ▇▇▇▇▇▇") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇. ▇▇▇▇▇▇", and, together
with ▇. ▇▇▇▇▇▇, the "Baileys"), on the one hand, and ▇▇▇ ▇. ▇▇▇▇▇▇▇ (the
"Stockholder"), on the other hand.
WHEREAS, the Baileys, the Stockholder and the other Purchasers
signatory thereto are parties to a certain Securities Purchase Agreement, dated
as of the date of this Agreement (the "Securities Purchase Agreement";
capitalized terms used herein but not defined herein shall have the meanings
ascribed to such terms in the Securities Purchase Agreement), pursuant to which
the Baileys, the Stockholder and the other Purchasers have agreed to purchase,
and Fuel-Tech N.V., a Netherlands Antilles limited liability company ("FTNV")
has agreed to issue, the Purchaser Stock and the Purchaser Warrants in the
amounts set forth on Schedule I to the Securities Purchase Agreement (the
Purchaser Stock and the Purchaser Warrants being collectively, the "Purchaser
Shares");
WHEREAS, ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("▇. ▇▇▇▇▇▇") have pledged
certain collateral totaling FF10,000,000, as may be reduced by the COSA Release
Total defined in 1(e) below (the "▇▇▇▇▇▇ Pledged Collateral") in favor of
Caterpillar Overseas S. A., a societe anonyme organized under Swiss law
("COSA"), as security for the payment by DieselCast France S. A. , a company
organized under the laws of France ("DieselCast"), of the purchase price for the
shares of Fonderie de Vernon S.A., a company organized under the laws of France
("▇▇▇▇▇▇"), pursuant to the Pledge and Security Agreement dated December 9, 1994
between COSA, ▇. ▇▇▇▇▇▇ and ▇. ▇▇▇▇▇▇ (the "Pledge and Security Agreement");
WHEREAS, ▇. ▇▇▇▇▇▇ and ▇. ▇▇▇▇▇▇ are beneficiaries of pledges of
certain assets from certain stockholders of DieselCast pursuant to the terms of
a Stockholders Agreement dated June 5, 1995 by and among ▇. ▇▇▇▇▇▇, ▇. ▇▇▇▇▇▇
and the other stockholders signatory thereto (the "DieselCast Stockholders
Agreement") and certain Deferred Compensation Agreements and Deferred Bonus
Agreements each dated October 31, 1994 between American ▇▇▇▇▇▇ Corporation
("ABC") and the employees of ABC signatory thereto (the "Other Pledge
Collateral");
WHEREAS, the Other Pledge Collateral shall be conveyed to ▇. ▇▇▇▇▇▇
and ▇. ▇▇▇▇▇▇ only in the event and to the extent that the ▇▇▇▇▇▇ Pledged
Collateral is taken by COSA;
WHEREAS, the parties desire that either of the Baileys have an option
to purchase from the Stockholder a portion of the Stockholder's Purchaser
Warrants (or shares of FTNV Stock acquired as a result of the exercise of the
Purchaser Warrants if sufficient
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Purchaser Warrants do not exist) in the event of the taking by COSA of all or
part of the collateral pledged by ▇. ▇▇▇▇▇▇ and ▇. ▇▇▇▇▇▇ pursuant to the Pledge
and Security Agreement;
WHEREAS, the Baileys wish to have an additional option to purchase
from the Stockholder a portion of the Stockholder's Purchaser Warrants in the
event that the Stockholder fails to achieve certain performance objectives;
WHEREAS, it is a condition precedent to the Stockholder's
participating in the transactions contemplated by the Securities Purchase
Agreement, that the Stockholder enter into this Agreement;
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained and intending to be legally bound hereby, the
parties agree as follows:
SECTION 1. The ▇▇▇▇▇▇ Right to Call Purchaser Warrants
(a) Upon any taking by COSA of any part of the ▇▇▇▇▇▇ Pledged
Collateral in excess of the Other Pledged Collateral (the "Unreimbursed
Amount"), the Stockholder agrees that either of the Baileys shall have the right
to require the Stockholder to sell a portion of the Stockholder's Purchaser
Warrants (or shares of FTNV Stock acquired as a result of exercise of the
Purchaser Warrants if sufficient Purchaser Warrants do not exist) to either of
the Baileys (the "▇▇▇▇▇▇ Call Right").
(b) The number of Purchaser Warrants of the Stockholder subject to the
▇▇▇▇▇▇ Call Right shall be calculated by multiplying (i) the total ▇▇▇▇▇▇
Restricted Warrants (as defined below) by (ii) the ▇▇▇▇▇▇ Call Percentage
(defined below) (fractional shares shall be rounded down to the nearest whole
share). If the Stockholder does not hold Purchaser Warrants sufficient to
satisfy the ▇▇▇▇▇▇ Call Right, then either of the Baileys shall also have the
right to require the Stockholder to sell to either of the Baileys that number of
shares of FTNV Stock which equals the number of shares of FTNV Stock into which
the shortfall of Purchaser Warrants converted (the "Shortfall FTNV Stock").
"▇▇▇▇▇▇ Restricted Warrants" shall mean 100,000 of the Stockholder's
Purchaser Warrants, as may be reduced by (i) Purchaser Warrants already
relinquished to the Baileys pursuant to the prior exercise of a ▇▇▇▇▇▇ Call
Right, if any, and (ii) the "▇▇▇▇▇▇ Warrant Reduction Amount" (as defined in
1(e) below).
"▇▇▇▇▇▇ Call Percentage" shall mean a fraction, (i) the numerator of
which is the Unreimbursed Amount and (ii) the denominator of which is
FF10,000,000, less (A)
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the portion of the ▇▇▇▇▇▇ Pledged Collateral previously taken by COSA, if any,
and (B) the "COSA Release Amount" (as defined in 1(e) below), if any.
(c) The Baileys shall exercise the ▇▇▇▇▇▇ Call Right by sending
written notice to the Stockholder. Upon the exercise of the ▇▇▇▇▇▇ Call Right,
the closing of the transaction shall occur not later than thirty (30) days
following the receipt of notice by the Stockholder.
(d) The option price for each of the ▇▇▇▇▇▇ Restricted Warrants shall
be the price paid for the Purchaser Warrants pursuant to the Securities Purchase
Agreement (the "Warrant Purchase Price"). The option price for each share of
Shortfall FTNV Stock, if any, shall be the price paid for the Shortfall FTNV
Stock, as well as the price paid for the underlying Purchaser Warrants.
(e) Each time that a portion of the ▇▇▇▇▇▇ Pledged Collateral is
released by COSA to the Baileys (each such released amount being a "COSA Release
Amount" and the total of all COSA Release Amounts being the "COSA Release
Total"), then a pro rata portion of the ▇▇▇▇▇▇ Restricted Warrants shall be
released to the Stockholder (the "▇▇▇▇▇▇ Warrant Reduction Amount"). The ▇▇▇▇▇▇
Warrant Reduction Amount shall be the product of (i) the ▇▇▇▇▇▇ Restricted
Warrants, multiplied by (ii) a fraction, the numerator of which shall be the
COSA Release Amount and the denominator of which shall be the ▇▇▇▇▇▇ Pledged
Collateral as may be reduced by the portion of the ▇▇▇▇▇▇ Pledged Collateral
previously taken by COSA, if any.
(f) Notwithstanding the provisions of Sections 1(a) through 1(e), the
total value of the ▇▇▇▇▇▇ Restricted Warrants and Shortfall FTNV Stock subject
to the ▇▇▇▇▇▇ Call Right shall not exceed the ▇▇▇▇▇▇ Call Value (as defined
below). The ▇▇▇▇▇▇ Call Value shall be based upon (i) the closing price of the
common stock of FTNV subject to the Purchaser Warrants and (ii) the currency
exchange rate between U.S. dollars and French francs, each as listed in the Wall
Street Journal as of the business day immediately preceding the Stockholder's
receipt of written notice as provided in Section 1(c).
"▇▇▇▇▇▇ Call Value" shall mean FF787,179, less the amount of the
Stockholder's Current Pledged Collateral set forth on Exhibit A hereto (as such
Exhibit A may be amended from time to time).
(g) Notwithstanding the provisions of Sections 1(a) through 1(f), if
the ▇▇▇▇▇▇ Call Right is exercised, and/or if the option under Section 6 of the
DieselCast Stockholders Agreement is exercised, then any proceeds ultimately
received by the Baileys from their exercise or sale of the ▇▇▇▇▇▇ Restricted
Warrants, sale of the Shortfall FTNV Stock or sale of the common stock of
DieselCast, which exceed the ▇▇▇▇▇▇ Call Value, shall be promptly returned by
the Baileys to the Stockholder.
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SECTION 2. Binding Effect; Assignment. This Agreement shall inure to
the benefit of, and shall be binding upon, the parties hereto and their
respective successors, assigns, heirs, and legal representatives. This Agreement
may not be assigned by any party hereto without the written consent of the other
parties which such consent shall be at the sole discretion of each party.
SECTION 3. The Performance Call Right.
(a) In the event that the Stockholder fails to carry out satisfactory
efforts to originate and provide a financing plan for at least one (1)
acquisition by American ▇▇▇▇▇▇ Corporation, a Delaware corporation, or any of
its affiliates (collectively, "ABC") approved by the board of directors of ABC
within eighteen (18) months of the Closing of the Securities Purchase Agreement
(the "Financing Objective"), then either of the Baileys shall have the right to
require that the Stockholder sell fifty thousand (50,000) Purchaser Warrants (or
shares of FTNV Stock acquired as a result of the exercise of the Purchaser
Warrants if sufficient Purchaser Warrants do not exist) (the "Performance
Warrants") to either of the Baileys (the "Performance Call Right"). If the
Stockholder does not hold Purchaser Warrants sufficient to satisfy the
Performance Call Right, then either of the Baileys shall also have the right to
require the Stockholder to sell to either of the Baileys that number of shares
of FTNV Stock which equals the number of shares of FTNV Stock into which the
shortfall of the Purchaser Warrants converted (the "Other Shortfall of FTNV
Stock").
(b) The determination of whether the Stockholder has satisfied the
Financing Objective shall be made by the board of directors of ABC in their sole
discretion. The board of directors of ABC shall exercise their discretion
reasonably.
(c) The Baileys shall exercise the Performance Call Right by sending
written notice to the Stockholder. Upon the exercise of the Performance Call
Right, the closing of the transaction shall occur not later than thirty (30)
days following the receipt of notice by the Stockholder.
(d) The option price for the Performance Warrants shall be the Warrant
Purchase Price. The option price for each share of the Other Shortfall of FTNV
Stock, if any, shall be the price paid for the Other Shortfall of FTNV Stock, as
well as the price paid for the underlying Purchaser Warrants.
SECTION 4. Binding Effect; Assignment. This Agreement shall inure to
the benefit of, and shall be binding upon, the parties hereto and their
respective successors, assigns, heirs, and legal representatives. This Agreement
may not be assigned by any party
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hereto without the written consent of the other parties which such consent shall
be at the sole discretion of each party.
SECTION 5. Governing Law; Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of the State of
Connecticut. For purposes of any action or proceeding involving this Agreement,
the Baileys and the Stockholder hereby expressly submit to the jurisdiction of
all Federal and state courts sitting in the state of Connecticut and consent
that any order, process, notice or motion or other application to or by any of
said courts or a judge thereof may be served within or without such court's
jurisdiction by registered mail or by personal service, provided that a
reasonable time for appearance is allowed. The Baileys and the Stockholder
hereby irrevocably waive any objection that they may now or hereafter may have
to the laying of venue of any suit, action or proceeding arising out of or
relating to this Agreement brought in any Federal or state court sitting in
Connecticut and hereby further irrevocably waive any claim that any such suit,
action or proceeding in any such court has been brought in an inconvenient
forum.
SECTION 6. Execution of Counterparts. This Agreement may be executed
in one or more counterparts, each of which shall be considered an original
instrument, but all of which shall be considered one and the same agreement.
SECTION 7. Waiver; Modification. No provision of this Agreement may be
modified, waived or discharged unless such waiver, modification or discharge is
agreed to in writing and signed by the parties hereto. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the same or at any prior or subsequent time.
[The remainder of this page is intentionally left blank.
The signature page follows.]
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IN WITNESS WHEREOF, this Agreement has been executed and delivered as
of the date first set forth above.
THE BAILEYS
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
THE STOCKHOLDER
/s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇
EXHIBIT A
CURRENT PLEDGED COLLATERAL
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of
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STOCKHOLDER
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FF186,690
$ 30,265*
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* Assumes a current exchange rate of $1.00 = FF6.1685 as of April 6, 1998
