WARRANT AGREEMENT
WARRANT AGREEMENT dated as of August 16, 1996, between
XCL LTD., a Delaware corporation ("XCL"), and TERRENEX
ACQUISITIONS CORP. ("Terrenex").
W I T N E S S E T H :
WHEREAS, by letter agreement dated August 16, 1996,
Terrenex arranged for the sale of XCL Common Stock to a non-North
American Person, in a transaction pursuant to Regulation S; and
WHEREAS, the form of partial compensation agreed to
between the parties was the issuance of warrants herein
described.
NOW, THEREFORE, in consideration of the premises the
parties hereto agree as follows:
Section 1. Definitions. (a) Terms used in this
Warrant Agreement shall have the following meanings, unless the
context otherwise requires:
"Commission" shall mean the Securities and
Exchange Commission or any entity succeeding to any or
all of its functions under the Securities Act.
"Common Stock" shall mean the common stock of XCL
as the same shall be in existence from time to time.
"Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, or any successor federal
statute.
"Exercise Price" shall mean the exercise price of
a Warrant, which shall be the lesser of $.25 per share
of Common Stock.
"Expiration Date" shall mean December 31, 1998.
"Person" shall mean an individual or firm,
corporation, partnership, trust, association or other
entity.
"Securities Act" shall mean the Securities Act of
1933, as amended, or any successor federal statute.
"The Stock Exchange Daily Official List" shall
mean the daily official list of the prices of stock
listed on the International Stock Exchange of the
United Kingdom of Great Britain and Northern Ireland
and the Republic of Ireland Limited.
"Warrant" shall mean a warrant issued pursuant to
this Agreement entitling the record holder thereof to
purchase from XCL at the Warrant Office one share of
Common Stock (subject to adjustment as provided in
Section 11) at the Exercise Price at any time on or
before 5:00 P.M., local time, at the Warrant Office, on
the Expiration Date. Where the context requires, the
term "Warrant" as used herein denotes one or more
Warrants evidenced by a single Warrant Certificate.
"Warrant Certificate" shall mean a certificate
evidencing one or more Warrants, substantially in the
form of Exhibit A hereto, with such changes therein as
may be required to reflect any adjustments made
pursuant to Section 11.
"Warrantholder" shall mean, initially the Persons
party to this Warrant Agreement and thereafter the
Persons named in the Warrant Register as the holders of
the Warrants.
"Warrant Office" shall mean the office or agency
of XCL at which the Warrant Register shall be
maintained and where the Warrants may be presented for
exercise, exchange, substitution and transfer, which
office or agency on the date of this Agreement is the
office of XCL at ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, which office or agency may be changed
by XCL upon five (5) business days prior notice in
writing to the Warrantholders.
"Warrant Register" shall mean the register,
substantially in the form of Exhibit B hereto,
maintained by XCL at the Warrant Office.
"Warrant Stock" shall mean the number of shares of
Common Stock issuable upon exercise of the Warrants.
(b) Other Rules of Construction. References in this
Agreement to Sections, Paragraphs and Exhibits are to
Sections and Paragraphs of and Exhibits to this Agreement
unless otherwise indicated. The words "hereof", "herein",
"hereunder" and comparable terms refer to the entirety of
this Agreement and not to any particular Section or other
subdivision hereof or attachment hereto. Words in the
singular include the plural and in the plural include the
singular. Words in the neuter gender shall include the
masculine and feminine and vice versa. The word "or" is not
exclusive. The word "including" shall be deemed to mean
"including, without limitation". The Section headings
contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or
interpretation of this Agreement.
Section 2. Representations and Warranties. XCL hereby
represents and warrants as follows:
(a) XCL is a corporation duly organized and validly
existing under the laws of the State of Delaware, has the
power and authority to execute and deliver this Agreement
and the Warrant Certificates, to issue the Warrants and to
perform its obligations under this Agreement and the Warrant
Certificates.
(b) The execution, delivery and performance by XCL of
this Agreement and the Warrant Certificates, the issuance of
the Warrants and the issuance of the Warrant Stock upon
exercise of the Warrants have been duly authorized by all
necessary corporate action, and do not and will not violate,
or result in a breach of, or constitute a default under, or
require any consent under, or result in the creation of any
lien upon the assets of XCL pursuant to, any requirement of
law or any material contractual obligation binding upon XCL.
(c) This Agreement has been duly executed and
delivered by XCL and constitutes a legal, valid, binding and
enforceable obligation of XCL. When the Warrants and
Warrant Certificates have been issued as contemplated hereby
(i) the Warrants and the Warrant Certificates will
constitute legal, valid, binding and enforceable obligations
of XCL and (ii) the Warrant Stock, when issued upon exercise
of the Warrants in accordance with the terms hereof, will be
duly authorized, validly issued, fully paid and
nonassessable shares of Common Stock with no personal
liability attaching to the ownership thereof (other than for
the statutory liability prescribed by Delaware law).
Section 3. Issuance of Warrants. XCL hereby agrees to
issue and deliver to Warranthholder one or more Warrant
Certificates evidencing Warrants to purchase 300,000 shares of
Common Stock at any time on or before 5:00 P.M., local time at
the Warrant Office, on the Expiration Date. Each Warrant shall
entitle the holder thereof to purchase one fully paid and
nonassessable share of Warrant Stock upon the exercise thereof at
a price per share equal to the Exercise Price as adjusted as
provided in Section 11. Each Warrant Certificate shall be
executed on behalf of XCL by the manual or facsimile signature of
the President or any executive officer of XCL, under its
corporate seal, affixed or in facsimile, attested by the manual
or facsimile signature of the Secretary or Assistant Secretary of
XCL. Warrants shall be dated as of August 16 1996.
Section 4. Exercise of Warrants. (a) Warrants may be
exercised at any time in whole or in part on any business day on
or before 5:00 p.m., local time, at the Warrant Office on the
Expiration Date by presentation and surrender of the Warrant
Certificate evidencing such Warrants, with the Form of Election
to Purchase (the "Election Form") annexed to the Warrant
Certificate and payment of the Exercise Price, multiplied by the
number of shares of Warrant Stock issuable upon exercise of such
Warrants. Upon surrender of such Warrant Certificate by the
Warrantholder thereof and payment of the Exercise Price by
certified or official bank check payable to the order of XCL of
the aggregate Exercise Price for the number of shares of Warrant
Stock in respect of which such Warrant is being exercised in
lawful money of the United States of America, XCL shall issue and
cause to be delivered with all reasonable dispatch to or upon the
written notice of such Warrantholder or upon the written order of
such Warrantholder and in such name or names as such
Warrantholder may designate, a certificate or certificates for
the Warrant Stock, together with cash in respect of any fraction
of a share of Warrant Stock issuable upon such surrender pursuant
to Section 7 hereof. The Warrantholders shall be deemed to have
been holders of record of the number of shares of Warrant Stock
specified in the Election Form as of the date of such exercise of
such Warrants.
(b) In the event that Warrants constituting less
than all of the Warrants evidenced by a Warrant Certificate
are exercised at any time prior to the Expiration Date, a
new Warrant Certificate, duly executed by XCL and dated the
same date as the Warrant Certificate being replaced, will be
issued for the remaining number of Warrants evidenced by the
Warrant Certificate so surrendered bearing the legend set
forth in Section 13(b). Warrantholders shall not be entitled
to receive fractional Warrants.
(c) XCL will, in accordance with applicable Delaware
law, take any action which may be necessary in order that
XCL may validly and legally issue fully paid and non-
assessable Warrant Stock at the Exercise Price, including
taking any corporate action that may, in the opinion of its
counsel, be necessary therefor prior to taking any action
that would cause a reduction of the Exercise Price, pursuant
to the provisions of Section 11 hereof, to an amount below
the then-par value of the Warrant Stock.
(d) XCL hereby agrees that at all times there shall be
reserved, for issuance and delivery upon exercise of the
Warrants, the Warrant Stock issuable from time to time upon
exercise of such Warrants. XCL covenants that all Warrant
Stock will, upon issuance in accordance with the terms of
this Agreement, be validly issued, fully paid and non-
assessable and free from all taxes with respect to the
issuance thereof and from all liens, charges, security
interests and other encumbrances or restrictions on sale
(other than restrictions on sales under applicable
securities laws) and free and clear of all adverse or
preemptive rights.
Section 5. Registration, Transfer and Exchange of
Certificates. (a) XCL shall maintain at the Warrant Office
the Warrant Register for registration of the Warrants and
Warrant Certificates and transfers thereof. XCL may deem and
treat the registered holder of any Warrant Certificate as
the absolute owner of the Warrants represented thereby
(notwithstanding any notation of ownership or other writing
on a Warrant Certificate made by anyone) for the purpose of
any exercise thereof or any distribution to the holder(s)
thereof, and for all other purposes, and XCL shall not be
affected by any notice to the contrary.
(b) Warrants may be exchanged or transferred at the
option of the holder thereof, subject to compliance with the
provisions of Section 13 hereof. XCL shall register the
transfer of the outstanding Warrants in the Warrant Register
upon surrender of the Warrant Certificates evidencing such
Warrants to XCL at the Warrant Office, accompanied (if so
required by it) by a written instrument or instruments of
transfer in form reasonably satisfactory to it, duly
executed by the registered holder or holders thereof or by
the duly appointed legal representative thereof. Upon any
such registration of transfer, one or more new duly executed
Warrant Certificates evidencing such transferred Warrants
shall be issued to the transferees and the surrendered
Warrant Certificates shall be canceled. If less than all
the Warrants evidenced by a Warrant Certificate(s)
surrendered for transfer are to be transferred, new duly
executed Warrant Certificate(s) shall be issued to the
Warrantholder surrendering such Warrant Certificate(s)
evidencing such remaining number of Warrants.
(c) Each Warrant Certificate may be exchanged at the
option of the holder thereof, when surrendered to XCL at the
Warrant Office, for another Warrant Certificate of like
tenor, or for other Warrant Certificates, representing an
equivalent number of Warrants. Any Warrant Certificate
surrendered for exchange shall be canceled. Subject thereto,
a Warrant Certificate may be divided or combined with other
Warrant Certificates evidencing the same rights of such
Warrant Certificate being divided or combined, upon
presentation of such Warrant Certificate being divided or
combined at the Warrant Office, together with written notice
specifying the names and denominations in which new Warrant
Certificates are to be issued and signed by the
Warrantholder of the Warrants evidenced by the Warrant
Certificate being so divided or combined.
(d) Except as provided in Sections 13(c) and 13(d),
each Warrant Certificate issued upon transfer or exchange
shall bear the legend set forth in Section 13(b) if the
Warrant Certificate presented for transfer or exchange bore
such legend.
(e) Any transfer, exchange or assignment of
Warrants (including any new Warrants issued pursuant to
Section 6 hereof) shall be without charge to the
Warrantholder (other than as set forth in Section 8 hereof
or any income tax withholding requirements) and any new
Warrant or Warrants issued pursuant to this Section 5 shall
be dated the date hereof.
Section 6. Mutilated or Missing Warrant Certificate. If
any Warrant Certificate shall be mutilated, lost, stolen or
destroyed, XCL shall issue, in exchange and substitution for and
upon cancellation of the mutilated Warrant Certificate, or in
lieu of and substitution for the Warrant Certificate lost, stolen
or destroyed, a new Warrant Certificate, in form and substance
identical to the form of such mutilated, lost, stolen or
destroyed Warrant Certificate of like tenor and representing an
equivalent number of Warrants as were evidenced by such
mutilated, lost, stolen or destroyed Warrant Certificate, but
only upon receipt of evidence satisfactory to XCL of such loss,
theft or destruction of such Warrant Certificate and, if
requested, indemnity reasonably satisfactory to it. Any such new
Warrant Certificate shall constitute an original contractual
obligation of XCL, whether or not the allegedly mutilated, lost,
stolen or destroyed Warrant Certificate shall be at any time
enforceable by any person. No service charge shall be made for
any such substitution, but all expenses and reasonable charges
associated with procuring such indemnity and all stamp, tax and
other governmental duties that may be imposed in relation thereto
shall be borne by the holder of such Warrant Certificate. Each
Warrant Certificate issued in any such substitution shall bear
the legend set forth in Section 13(b) if the Warrant Certificate
for which such substitution was made bore such legend.
Section 7. No Fractional Stock. XCL shall not be required
to issue fractional shares of Common Stock upon exercise of any
Warrants by a Warrantholder. Instead of any fractional shares of
Warrant Stock that would otherwise be issuable to such
Warrantholder, XCL shall pay to such Warrantholder a cash
adjustment in respect of such fractional interest in an amount
equal to such fractional interest of the then-current Market
Price per share (as defined in Section 11 hereof) of Warrant
Stock.
Section 8. Payment of Taxes. XCL will pay any and all
documentary, stamp, transfer or other taxes attributable to the
initial issuance or delivery of Warrant Stock; provided that XCL
shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issue of any Warrant
Certificate or any certificate for Warrant Stock in a name other
than that of the registered holder of a Warrant Certificate
surrendered upon the exercise of a Warrant, and XCL shall not be
required to issue or deliver such certificates unless or until
the person or persons requesting the issuance thereof shall have
paid to XCL the amount of such tax or shall have established to
the reasonable satisfaction of XCL that such tax has been paid.
Section 9. No Stockholder Rights. Unless and until
exercise of any Warrant shall have occurred, nothing contained in
this Agreement or in any of the Warrant Certificate evidencing
such Warrant shall be construed as conferring upon the holders
thereof the right to vote or to receive dividends or subscription
rights, or to consent or to receive notice as a stockholder in
respect of the meetings of the stockholders or the election of
directors of XCL or any other matter, or any rights whatsoever as
a stockholder of XCL. No provisions of any Warrant or of this
Warrant Agreement, in the absence of affirmative action by the
Warrantholder to exercise such Warrant, and no mere enumeration
herein of the rights or privileges of such Warrantholder, shall
give rise to any liability of such Warrantholder for the Exercise
Price or as a stockholder of XCL, whether such liability is
asserted by XCL or its creditors.
Section 10. Obtaining of Governmental Approvals and Stock
Exchange Listings. XCL will, at its own expense, from time to
time take all action which may be necessary to obtain and keep
effective any and all permits, consents and approvals of
governmental agencies and authorities which may be or become
requisite in connection with the issuance, sale, transfer and
delivery of the Warrant Certificates and the exercise of the
Warrants and the issuance, sale, transfer and delivery of the
Warrant Stock and all action which may be necessary so that such
Warrant Stock, immediately upon their issuance upon the exercise
of Warrants, or at such later time as shall be otherwise provided
herein, will be listed on each securities exchange, if any, on
which the Common Stock is then listed; provided, however, except
as set forth in Section 13A hereof, nothing herein provided shall
require XCL to register the Warrants or the Warrant Stock under
the Securities Act.
Section 11. Adjustment of Number of Shares of Warrant Stock
Purchasable. Prior to the Expiration Date, the Exercise Price is
subject to adjustment from time to time as follows:
(a) In case XCL shall at any time after the date of
this Agreement (i) declare a dividend on the shares of
Common Stock payable in shares of Common Stock, or (ii)
subdivide or split up the outstanding shares of Common Stock
the amount of Warrant Stock to be delivered upon exercise of
any Warrant will be appropriately increased so that the
Warrantholder will be entitled to receive the amount of
Warrant Stock that such Warrantholder would have owned
immediately following such actions had such Warrant been
exercised immediately prior thereto, and the Exercise Price
in effect immediately prior to the record date for such
dividend or the effective date for such subdivision shall be
proportionately decreased, all effective immediately after
the record date for such dividend or the effective date for
such subdivision or split up. Such adjustments shall be
made successively whenever any event listed above shall
occur.
(b) In case XCL shall at any time after the date of
this Agreement combine the outstanding shares of Common
Stock into a smaller number of units, the Exercise Price in
effect immediately prior to the record date for such
combination shall be proportionately increased, effective
immediately after the record date for such combination.
Such adjustment shall be made successively whenever any such
combinations shall occur.
(c) In the event that XCL shall at any time after the
date of this Agreement (i) issue or sell any shares of
Common Stock (other than Warrant Stock) (or securities
convertible or exchangeable into Common Stock) without
consideration or at a price per share (or having a
conversion price per share, if a security convertible into
Common Stock) less than the Market Value per share of Common
Stock (as defined in Section 11(e) hereof), or (ii) issue or
sell options, rights or warrants to subscribe for or
purchase Common Stock at a price per share less than the
Market Price per share of Common Stock (as defined in
Section 11(e) hereof), the Exercise Price to be in effect
after the date of such issuance shall be determined by
multiplying the Exercise Price in effect on the day
immediately preceding the relevant issuance or record date,
as the case may be, used in determining such Market Value or
Market Price, by a fraction, the numerator of which shall be
the number of shares of Common Stock outstanding on such
issuance or record date plus the number of shares of Common
Stock which the aggregate offering price of the total number
of shares of Common Stock so to be issued or to be offered
for subscription or purchase (or the aggregate initial
conversion price of the convertible securities so to be
offered) would purchase at such Market Value or Market
Price, as the case may be, and the denominator of which
shall be the number of shares of Common Stock outstanding on
such issuance or record date plus the number of additional
shares of Common Stock to be issued or to be offered for
subscription or purchase (or into which the convertible
securities so to be offered are initially convertible); such
adjustment shall become effective immediately after the
close of business on such issuance or record date; provided,
however, that no such adjustment shall be made for the
issuance of (s) options to purchase shares of Common Stock
granted pursuant to XCL's employee stock option plans
approved by shareholders of XCL (and the shares of Common
Stock issuable upon exercise of such options) (provided that
option exercise prices shall not be less than the Market
Value of the Common Stock (as defined in Section 11(e)
hereof) on the date of the grant of such options), (t) XCL's
warrants to purchase shares of Common Stock (and the shares
of Common Stock issuable upon exercise of such warrants),
outstanding on the date hereof, (u) XCL's shares of Series
A, Cumulative Convertible Preferred Stock (and the shares of
Common Stock issuable upon conversion of such preferred
stock), (v) XCL's shares of Series B, Cumulative Preferred
Stock (and the shares of Common Stock issuable in lieu of
dividend and redemption payments thereunder), (w) XCL's $15
million in principal of Secured Subordinated Debt Notes (and
the shares of Common Stock issuable in lieu of interest
payments thereunder) and (x) XCL's shares of Series E,
Cumulative Convertible Preferred Stock (and shares of Common
Stock issuable upon conversion of such preferred stock). In
case such subscription price may be paid in a consideration
part or all of which shall be in a form other than cash, the
value of such consideration shall be as determined
reasonably and in good faith by the Board of Directors of
XCL and reviewed and approved by the independent auditors of
XCL. Shares of Common Stock owned by or held for the
account of XCL or any wholly-owned subsidiary shall not be
deemed outstanding for the purpose of any such computation.
Such adjustment shall be made successively whenever the date
of such issuance is fixed (which date of issuance shall be
the record date for such issuance if a record date therefor
is fixed); and, in the event that such shares or options,
rights or warrants are not so issued, the Exercise Price
shall again be adjusted to be the Exercise Price which would
then be in effect if the date of such issuance had not been
fixed.
(d) In case XCL shall make a distribution to all
holders of Common Stock (including any such distribution
made in connection with a consolidation or merger in which
XCL is the continuing corporation) of evidences of its
indebtedness, securities other than Common Stock or assets
(other than cash dividends or cash distributions payable out
of consolidated earnings or earned surplus or dividends
payable in Common Stock), the Exercise Price to be in effect
after such date of distribution shall be determined by
multiplying the Exercise Price in effect on the date
immediately preceding the record date for the determination
of the stockholders entitled to receive such distribution by
a fraction, the numerator of which shall be the Market Price
per share of Common Stock (as defined in Section 11(e)
hereof) on such date, less the then-fair market value (as
determined reasonably and in good faith by the Board of
Directors of XCL and reviewed and approved by the
independent auditors of XCL) of the portion of the assets,
securities or evidences of indebtedness so to be distributed
applicable to one share of Common Stock and the denominator
of which shall be such Market Price per share of Common
Stock, such adjustment to be effective immediately after the
distribution resulting in such adjustment. Such adjustment
shall be made successively whenever a date for such
distribution is fixed (which date of distribution shall be
the record date for such distribution if a record date
therefor is fixed); and, if such distribution is not so
made, the Exercise Price shall again be adjusted to be the
Exercise Price which would then be in effect if such date of
distribution had not been fixed.
(e) For the purposes of any computation under this
Section 11, the "Market Price per share" of Common Stock on
any date shall be deemed to be the average of the closing
sales price for the 20 consecutive trading days ending on
the record date for the determination of the shareholders
entitled to receive any rights, dividends or distributions
described in this Section 11, and the "Market Value per
share" of Common Stock on any date shall be deemed to be the
closing sales price on the date of the issuance of the
securities for which such computation is being made, as
reported on the principal United States securities exchange
on which the Common Stock is listed or admitted to trading
or if the Common Stock is not then listed on any United
States stock exchange, the average of the closing sales
price on each such day during such 20 day period, in the
case of the Market Price computation, or on such date of
issuance, in the case of the Market Value computation, in
the over-the-counter market as reported by the National
Association of Securities Dealers' Automated Quotation
System ("NASDAQ"), or, if not so reported, the average of
the closing bid and asked prices on each such day during
such 20 day period in the case of the Market Price
computation, or on such date of issuance, in the case of the
Market Value computation, as reported in the "pink sheets"
published by the National Quotation Bureau, Inc. or any
successor thereof, or, if not so quoted, the average of the
middle market quotations for such 20 day period in the case
of the Market Price computation, or on such date of
issuance, in the case of the Market Value computation, as
reported on The Stock Exchange Daily Official List. In the
case of Market Price or Market Value computations based on
The Stock Exchange Daily Official List, the Market Price or
Market Value shall be converted into United States dollars
at the then spot market exchange rate of pounds sterling
(UK) into United States dollars as quoted by Chemical Bank
or any successor bank thereto on the date of determination.
If a quotation of such exchange rate is not so available,
the exchange rate shall be the exchange rate of pounds
sterling in United States dollars as quoted in The Wall
Street Journal on the date of determination.
(f) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least 1% in such price; provided that any
adjustments which by reason of this Section 11(f) are not
required to be made shall be carried forward and taken into
account in any subsequent adjustment; provided, further that
such adjustment shall be made in all events (regardless of
whether or not the amount thereof or the cumulative amount
thereof amounts to 1% or more) upon the happening of one or
more of the events specified in Sections 11(a), (b) or (h).
All calculations under this Section 11 shall be made to the
nearest cent.
(g) If at any time, as a result of an adjustment made
pursuant to Section 11(a) or (b) hereof, the holder of any
Warrant thereafter exercised shall become entitled to
receive any shares of XCL other than shares of Common Stock,
thereafter the number of such other shares so receivable
upon exercise of any Warrant shall be subject to adjustment
from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to
the Warrant Stock contained in this Section 11, and the
provisions of this Agreement with respect to the Warrant
Stock shall apply on like terms to such other shares.
(h) In the case of (1) any capital reorganization of
XCL, or of (2) any reclassification of the shares of Common
Stock (other than a subdivision or combination of
outstanding shares of Common Stock), or (3) any
consolidation or merger of XCL or (4) the sale, lease or
other transfer of all or substantially all of the properties
and assets of XCL as, or substantially as, an entirety to
any other person or entity, each Warrant shall after such
capital reorganization, reclassification of the shares of
Common Stock, consolidation, or sale be exercisable, upon
the terms and conditions specified in this Agreement, for
the number of shares of stock or other securities or assets
to which a holder of the number of shares of Warrant Stock
purchasable (immediately prior to the effectiveness of such
capital reorganization, reclassification of shares of Common
Stock, consolidation, or sale) upon exercise of a Warrant
would have been entitled upon such capital reorganization,
reclassification of shares of Common Stock, consolidation,
merger or sale; and in any such case, if necessary, the
provisions set forth in this Section 11 with respect to the
rights thereafter of a Warrantholder shall be appropriately
adjusted (as determined reasonably and in good faith by the
Board of Directors of XCL and reviewed and approved by the
independent auditors of XCL) so as to be applicable, as
nearly as may reasonably be, to any shares of stock or other
securities or assets thereafter deliverable on the exercise
of a Warrant. XCL shall not effect any such consolidation
or sale, unless prior to or simultaneously with the
consummation thereof, the successor corporation, partnership
or other entity (if other than XCL) resulting from such
consolidation or the corporation, partnership or other
entity purchasing such assets or the appropriate entity
shall assume, by written instrument, the obligation to
deliver to the holder of each Warrant the shares of stock,
securities or assets to which, in accordance with the
foregoing provisions, such holder may be entitled and all
other obligations of XCL under this Agreement. For purposes
of this paragraph (h) a merger to which XCL is a party but
in which the Common Stock outstanding immediately prior
thereto is changed into securities of another corporation
shall be deemed a consolidation with such other corporation
being the successor and resulting corporation.
(i) Irrespective of any adjustments in the Exercise
Price or the number or kind of shares purchasable upon the
exercise of the Warrant, Warrant Certificates theretofore or
thereafter issued may continue to express the same Exercise
Price per share and number and kind of shares as are stated
on the Warrant Certificates initially issuable pursuant to
this Agreement.
Section 12. Notices to Warrantholders. Upon any
adjustment pursuant to Section 11, XCL shall promptly, but in any
event within 20 days thereafter, cause to be given to each of the
registered holders of the Warrants, at its address appearing on
the Warrant Register, by first-class mail, postage prepaid, a
certificate signed by its Chairman of the Board, its President,
or any Vice President, and its Treasurer, Secretary or any
Assistant Secretary setting forth the Exercise Price as so
revised and the number of shares of Common Stock issuable upon
the exercise of each Warrant as so adjusted and describing in
reasonable detail the facts accounting for such adjustments and
the method of calculation used. Where appropriate, such
certificate may be given in advance and included as a part of the
notice required to be mailed under the other provisions of this
Section 12.
In case:
(a) XCL shall authorize the issuance to all holders of
shares of Common Stock of options, rights or warrants to
subscribe for or purchase Common Stock of XCL or of any
other subscription rights or warrants; or
(b) XCL shall authorize the distribution to all
holders of shares of Common Stock of evidences of its
indebtedness or assets (other than cash dividends or cash
distributions payable out of consolidated earnings or earned
surplus or dividends payable in shares of Common Stock); or
(c) of any consolidation or merger to which XCL is a
party, or of the conveyance or transfer of all or
substantially all of the properties and assets of XCL
substantially as an entirety, or of any capital
reorganization or reclassification or change of the shares
of Common Stock; or
(d) of the voluntary or involuntary dissolution,
liquidation, bankruptcy, assignment for the benefit of
creditors or winding up of XCL; or
(e) XCL proposes to take any other action or any other
event occurs which would require an adjustment of the
Exercise Price pursuant to Section 11;
then XCL shall cause to be given to each of the registered
holders of the Warrants at its address appearing on the Warrant
Register, at least 20 calendar days prior to the applicable
record date or effective date, as the case may be, hereinafter
specified, by first-class mail, postage prepaid, a written notice
stating (i) the date as of which the holders of record of shares
of Common Stock to be entitled to receive any such rights,
warrants or distribution are to be determined, or (ii) the date
on which any such consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that holders
of record of shares of Common Stock shall be entitled to exchange
their units for securities or other property, if any, deliverable
upon such reclassification, consolidation, merger, conveyance,
transfer, dissolution, liquidation or winding up.
Section 13. Restrictions on Transfer. (a) Each
Warrantholder represents that it is acquiring the Warrants, and
upon the exercise thereof the Warrant Stock, for its own account,
for
investment and not with a view to any distribution or public
offering within the meaning of the Securities Act. Each
Warrantholder acknowledges that the Warrants and the Warrant
Stock issuable upon exercise thereof have not been registered
under the Securities Act or any state securities laws and agrees
that it will not sell or otherwise transfer its Warrants or
Warrant Stock except in compliance with the Securities Act and
applicable state laws and upon the terms and conditions specified
herein and that it will cause any transferee thereof to agree to
take and hold the same subject to the terms and conditions
specified herein.
(b) Except as provided in Sections 13(c) and 13(d)
hereof, each Warrant Certificate and each certificate for
the Warrant Stock shall include a legend appropriately
conformed and in substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
UNDER THE SECURITIES LAWS OR BLUE SKY LAWS OF ANY OTHER
DOMESTIC OR FOREIGN JURISDICTION. SUCH SECURITIES MAY NOT
BE SOLD, OFFERED FOR SALE OR OTHERWISE TRANSFERRED EXCEPT
IN COMPLIANCE WITH SUCH LAWS AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER. SUCH SECURITIES ARE ALSO SUBJECT TO
CERTAIN RESTRICTIONS ON TRANSFER CONTAINED IN THE WARRANT
AGREEMENT DATED AS OF AUGUST 16, 1996, BETWEEN THE ISSUER
AND THE INITIAL HOLDER OF THE WARRANTS NAMED THEREIN. A
COPY OF SUCH AGREEMENT IS AVAILABLE FOR INSPECTION AT THE
PRINCIPAL OFFICE OF THE ISSUER AND WILL BE FURNISHED WITHOUT
CHARGE TO THE HOLDER HEREOF UPON WRITTEN REQUEST TO THE
SECRETARY OF THE ISSUER, AND THE HOLDER OF THE SECURITIES
AGREES TO BE BOUND THEREBY.
(c) Prior to any proposed transfer of the Warrant
or any Warrant Stock the holder thereof shall give
prior written notice to XCL of such holder's intention
to effect such transfer. Each such notice shall be
accompanied by a written opinion of such holder's
counsel which counsel and which opinion shall be
reasonably satisfactory to XCL to the effect that the
proposed transfer may be effected without registration
under the Securities Act or applicable state laws. The
Warrant Certificate and each certificate evidencing the
Warrant Stock transferred pursuant to this Section
13(c) shall bear the legend set forth in Section 13(b);
provided, however, that such legend shall not be
required if such transfer is being made in connection
with a sale which is exempt from registration pursuant
to Rule 144 under the Securities Act or if the opinion
of counsel referred to above is to the further effect
that neither such legend nor the restrictions on
transfer in this Section 13 are required in order to
ensure compliance with the Securities Act and such
applicable state laws.
(d) The restrictions set forth in this Section 13
shall terminate and cease to be effective with respect
to any Warrant Stock registered under the Securities
Act or as to which the proviso to the last sentence of
Section 13(c) is applicable. Whenever such
restrictions shall so terminate XCL will rescind any
transfer restrictions relating thereto and the holder
of such Warrant and/or Warrant Stock shall be entitled
to receive from XCL, without expense (other than
transfer taxes, if any), a Warrant Certificate or
certificates for such Warrant Stock not bearing the
legend set forth in Section 13(b).
Section 13A. Registration Rights.
(A) Subject to the provisions of subparagraph
(C)(ii) below, if, at any time after the date hereof, XCL
proposes to register any shares of its Common Stock (or
securities convertible into its Common Stock) under the
Securities Act (other than on Form S-4 or Form S-8 or other
comparable form as may be in effect), it will at each such time
give written notice to all holders of the Warrants and Warrant
Stock of its intention to do so and, upon the written request of
any holder thereof given within 20 days after XCL's giving of
such notice (which request shall state the intended method of
disposition thereof by the prospective sellers), XCL will use its
best efforts to effect the registration of the Warrant Stock
which it shall have been so requested to register by including
the same in such registration statement, all to the extent
requisite to permit the sale or other disposition thereof in
accordance with the intended method of sale or other disposition
given in each such request. In the event that any registration
pursuant to this Section 13(A) shall be in connection with an
underwritten offering of equity securities of XCL, and the
managing underwriter determines in good faith and advises in
writing that the number of shares of Common Stock which XCL
proposes to offer under such registration statement, together
with the number of shares of Warrant Stock and other shares of
Common Stock requested to be included in such registration
statement by the holders of securities having registration rights
similar to those of this Section 13(A), exceeds the number of
shares of Common Stock it is advisable to offer and sell at such
time, then the number of shares of Common Stock to be sold by
XCL, such holders and such other shareholders after such
reduction shall be allocated between XCL, such holders and such
other shareholders, such that XCL shall have the right to have
offered no less than 75% of the original number of shares
proposed or requested by XCL to be registered and the balance
shall be allocated among the holders and such other shareholders
pro rata with respect to the number of shares of Common Stock or
Warrant Stock, as the case may be, owned by each such holder and
such other shareholders on the date of the notice provided by XCL
pursuant to this Section 13(A). Notwithstanding the foregoing
provisions, XCL may withdraw any registration statement referred
to in this Section 13(A) without thereby incurring any liability
to the holders of Warrant Stock.
(B) As a condition to the inclusion of shares of
Warrant Stock in any registration statement, each holder of
Warrant Stock requesting registration thereof will furnish to XCL
such information with respect to them and their plan of
distribution of such shares as is required to be disclosed in the
registration statement (and the prospectus and all amendments
thereto included therein) by the applicable rules, regulations
and guidelines of the Securities and Exchange Commission
("Commission").
(C) If and whenever the Company is required to use its
best efforts to effect the registration of shares of Warrant
Stock under the Securities Act, XCL shall:
(i) prepare and file with the Commission a
registration statement on the appropriate form with respect
to such Warrant Stock and use its best efforts to cause such
registration statement to become effective as soon as
practicable after the date of any request given by a holder
of Warrant Stock pursuant to this Section 13A.
(ii) prepare and file with the Commission such
amendments and supplements (including post-effective
amendments and supplements) to the registration statement
covering such Warrant Stock and the prospectus used in
connection therewith as may be necessary to keep such
registration statement effective and to comply with any
applicable provisions of the Securities Act with respect to
the disposition of all such Warrant Stock covered by such
registration statement until such time, as all of such
Warrant Stock registered thereunder has been disposed of in
accordance with the intended method of disposition of the
holders set forth therein or until such Warrant Stock can be
freely sold under the Securities Act or the Warrants are no
longer outstanding or the Warrants shall have expired in
accordance with their respective terms without having been
exercised;
(iii) furnish to each holder such number of copies
of a prospectus and preliminary prospectus in conformity
with the requirements of the Securities Act, and such other
documents as the holders may reasonably request, in order to
facilitate the public sale or other disposition of such
Warrant Stock;
(iv) notify each holder if, at any time when a
prospectus relating to such Warrant Stock is required to be
delivered under the Securities Act, any event shall have
occurred as a result of which the prospectus then in use
with respect to such Warrant Stock includes an untrue
statement of a material fact or omits to state a material
fact necessary to make the statements made therein, in light
of the circumstances under which they were made, not
misleading, or for any other reason it shall be necessary to
amend or supplement such prospectus in order to comply with
the Securities Act, and prepare and furnish to the holders a
reasonable number of copies of a supplement to or an
amendment of such prospectus which will correct such
statement or omission or effect such compliance;
(v) use its best efforts to register or qualify such
Warrant Stock under such other securities or blue sky laws
of such jurisdictions as the holders shall reasonably
request and do any and all other acts and things which may
be necessary or desirable to enable the holders to
consummate the public sale or other disposition in each such
jurisdiction of such Warrant Stock owned by them; provided,
however, that XCL shall not be required to consent to the
general service of process or to qualify to do business in
any jurisdiction where it is not then qualified;
(vi) use its best efforts, promptly after receipt of
such information, to notify the holders of the following:
(A) when such registration statement or any post-effective
amendment or supplement thereto becomes effective or is
approved; (B) the issuance by any competent authority of any
stop order suspending the effectiveness or qualification of
such registration statement or the prospectus then in use or
the initiation or threat of any proceeding for that purpose;
and (C) the suspension of the qualification of any such
Warrant Stock included in such registration statement for
sale in any jurisdiction;
(viii) pay all costs and expenses incident to the
performance and compliance by XCL of its obligations under
this Section 13A including, without limitation, (1) all
registration and filing fees; (2) all printing expenses; (3)
all fees and disbursements of counsel and independent public
accountants for XCL; (4) all blue sky fees and expenses
(including fees and expenses of counsel for XCL in
connection with blue sky surveys); and (5) the entire
expense of any special audits required by the rules and
regulations of the Commission; provided, however, that XCL
shall have no obligation to pay or otherwise bear any
portion of the fees and disbursements of counsel and
accountants for the holders and the underwriters' fees, out-
of-pocket costs, commissions or discounts attributable to
the Warrant Stock being offered and sold by the holders, all
of which shall be paid or otherwise borne by the holders.
(D) In connection with a registration pursuant to this
Section 13A covering an underwritten public offering, XCL and
the holders agree to enter into a written agreement with the
managing underwriter in such form and containing such provisions
as are customary in the securities business for such an
arrangement between such underwriter and companies of XCL's size
and investment stature.
(E) (i) XCL will indemnify and hold harmless the holders,
their officers and directors and any "underwriter" (as defined in
the Securities Act) for the holders and each other person, if any
who controls the holders within the meaning of the Securities Act
from and against any and all losses, claims, damages, liabilities
and legal and other expenses (including costs of investigation,
defense and good-faith settlement) caused by any untrue statement
or alleged untrue statement of a material fact contained in any
registration statement under which the Warrant Stock was
registered under the Securities Act, any prospectus or
preliminary prospectus contained therein or any amendment or
supplement thereto, or caused by any omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in light
of the circumstances then existing, except insofar as such
losses, claims, damages, liabilities or expenses are caused by
any such untrue statement or omission or alleged untrue statement
or omission based upon information relating to the holders and
furnished to XCL in writing by the holders expressly for use
therein.
(ii) It shall be a condition to the obligation of XCL
to effect a registration of the Warrant Stock of any holder
under the Securities Act pursuant hereto, that such holder
indemnifies and holds harmless XCL and, in connection with
an underwritten public offering, each underwriter and each
person, if any, who controls XCL or the underwriter, within
the meaning of the Securities Act, to the same extent as the
indemnity from XCL in the foregoing paragraph, but only with
reference to information relating to such holder furnished
to XCL or the underwriter in writing by such holder
expressly for use in the registration statement, any
prospectus or preliminary prospectus contained therein or
any amendment or supplement thereto.
(iii) In case any claim shall be made or any
proceeding (including any governmental investigation) shall
be instituted involving any indemnified party in respect of
which indemnity may be sought pursuant to this Section 13A,
such indemnified party shall promptly notify the
indemnifying party in writing of the same; provided that
failure to notify the indemnifying party shall not relieve
it from any liability it may have to an indemnified party
otherwise than under this Section 13A. The indemnifying
party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to
represent the indemnified party in such proceeding and shall
pay the fees and disbursements of such counsel. In any such
proceeding, any indemnified party shall have the right to
retain its own counsel, but the fees and disbursements of
such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party shall have failed to
retain counsel for the indemnified party as aforesaid, (ii)
the indemnifying party and such indemnified party shall have
mutually agreed to the retention of such counsel or (iii)
representation of such indemnified party by the counsel
retained by the indemnifying party would be inappropriate
due to actual or potential differing interests between such
indemnified party and any other party represented by such
counsel in such proceeding; provided that XCL shall not be
liable for the fees and disbursements of more than one
additional counsel for all indemnified parties. The
indemnifying party shall not be liable for any settlement of
any proceeding effected without its written consent but if
settled with such consent or if there be a final judgment
for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. XCL
shall not, except with the approval of each indemnified
party (which approval shall not be unreasonably withheld)
under this Section 13A, consent to entry of any judgment or
enter into any settlement that does not include as an
unconditional term thereof the release by all interested
claimants and plaintiffs of the indemnified parties from all
liability in respect of such claim or litigation.
Section 13B. Reservation of Shares. XCL shall at all times
have authorized, and reserve and keep available and free from
preemptive rights or other restrictions (except as required by
law), for the purpose of enabling it to satisfy any obligation to
issue Warrant Stock upon the exercise of the Warrants, the number
of shares of Common Stock deliverable upon exercise of all
outstanding Warrants.
Section 14. Amendments and Waivers. Any provision of
this Agreement may be amended, supplemented, waived, discharged
or terminated by a written instrument signed by XCL and the
holders of not less than a majority of the outstanding Warrants;
provided that the Exercise Price may not be increased and the
amount of Warrant Stock issuable upon exercise of the Warrants
may not be reduced (except pursuant to Section 11 hereof), the
Expiration Date may not be changed to an earlier date and this
Section may not be amended except with the consent of the holders
of all outstanding Warrants and/or Warrant Stock.
Section 15. Specific Performance. The holders of the
Warrants shall have the right to specific performance by XCL of
the provisions of this Warrant Agreement. XCL hereby irrevocably
waives, to the extent that it may do so under applicable law, any
defense based on the adequacy of a remedy at law which may be
asserted as a bar to the remedy of specific performance in any
action brought against XCL for specific performance of this
Warrant Agreement by the holders of the Warrants.
Section 16. Notices. Any notice or demand to be given
or made by the holders to or on XCL pursuant to the Agreement
shall be sufficiently given or made if sent by mail, first-class
or registered, postage prepaid, addressed to XCL as follows (or
to such other address as may hereafter be designated by XCL in
writing to such registered holder):
XCL Ltd.
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
Any notice to be given by XCL to any of the holders of
the Warrants or the Warrant Stock shall be sufficiently given if
sent by first-class mail, postage prepaid, addressed to such
holder as such holder's name and address shall appear on the
Warrant Register or the Common Stock registry of XCL, as the case
may be.
Section 17. Binding Effect. This Agreement shall be
binding upon and inure to the sole and exclusive benefit of XCL,
its successors and assigns, the other parties hereto and the
registered holders from time to time of the Warrants and the
Warrant Stock, and their respective successors, assigns and
heirs.
Section 18. Termination. This Agreement shall
terminate and be of no further force and effect at the close of
business on the Expiration Date or the date on which none of the
Warrants shall be outstanding, except that the provisions of
Section 13(d) shall continue in full force and effect after such
termination.
Section 19. Counterparts. This Agreement may be
executed in one or more separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and
the same instrument.
Section 20. DELAWARE LAW. THIS AGREEMENT AND EACH
WARRANT CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE.
Section 21. Benefits of This Agreement. Nothing in
this Agreement shall be construed to give to any Person other
than XCL and the registered holders of the Warrants and the
Warrant Stock any legal or equitable right, remedy or claim under
this Agreement.
Section 22. Availability of Information. XCL shall
comply with all applicable public information reporting
requirements to which it may be subject from time to time,
including, without limitation, Rule 144 under the Securities Act
as it relates to the availability of an exemption from the
Securities Act for the sale of restricted securities. The
Company also shall cooperate with each Warrantholder and with
each holder of any Warrant Stock in supplying such information as
may be necessary for any such holder to compete and file any
information reporting forms presently or hereafter required by
the Commission as a condition to the availability of an exemption
from the Securities Act for the sale of restricted securities.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the date and
year first above written.
XCL LTD.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
______________________
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
__________________________________________
[Signature of Warrant Owner if individual]
__________________________________________
[Signature of Warrant Owners if Joint Tenant,
Tenant in Common or Tenant by the Entirety]
Terrenex Acquisition Corp.
__________________________________________
[Print Name of Corporation,
Partnership, Trust or Other Entity
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
___________________________________
[Signature of Authorized Signatory
signing on behalf of the
Corporation, Partnership, Trust or
Other Entity]
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
___________________________________
[Print Name of Signatory]
EXHIBIT A
to Warrant
Agreement
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
UNDER THE SECURITIES LAWS OR BLUE SKY LAWS OF ANY OTHER
DOMESTIC OR FOREIGN JURISDICTION. SUCH SECURITIES MAY NOT
BE SOLD, OFFERED FOR SALE OR OTHERWISE TRANSFERRED EXCEPT
IN COMPLIANCE WITH SUCH LAWS AND THE RULES AND REGULATIONS
PROMULGATED THEREUNDER. SUCH SECURITIES ARE ALSO SUBJECT TO
CERTAIN RESTRICTIONS ON TRANSFER CONTAINED IN THE WARRANT
AGREEMENT, DATED AS OF AUGUST 16, 1996, BETWEEN THE ISSUER
AND THE INITIAL HOLDER OF THE WARRANTS NAMED THEREIN. A
COPY OF SUCH AGREEMENT IS AVAILABLE FOR INSPECTION AT THE
PRINCIPAL OFFICE OF THE ISSUER AND WILL BE FURNISHED WITHOUT
CHARGE TO THE HOLDER HEREOF UPON WRITTEN REQUEST TO THE
SECRETARY OF THE ISSUER AND THE HOLDER OF THE SECURITIES
AGREES TO BE BOUND THEREBY.
EXERCISABLE ONLY IN ACCORDANCE WITH WARRANT AGREEMENT
No. TAC-1 300,000 Warrants
WARRANT CERTIFICATE
XCL LTD.
This Warrant Certificate certifies that, for value
received, Terrenex Acquisitions Corp. is the registered holder
of 300,000 Warrants (the "Warrants") to purchase 300,000 shares
of common stock, par value $.01 per share ("Common Stock") of XCL
Ltd. ("XCL"). Each Warrant entitles the holder, subject to the
conditions set forth herein and in the Warrant Agreement dated
as of August 16, 1996, between XCL and the other parties thereto
(the "Warrant Agreement"), to purchase from XCL on or before 5:00
p.m., local time at the Warrant Office, on the Expiration Date
(as such term is defined in the Warrant Agreement) one fully paid
and nonassessable share of Common Stock of XCL (the "Warrant
Stock") at the Exercise Price (as such term is defined in the
Warrant Agreement) of Warrant Stock payable by certified or
official bank check payable to the order of XCL in lawful money
of the United States of America, upon surrender of this Warrant
Certificate, with the Form of Election to Purchase annexed hereto
and payment of the Exercise Price at the office of XCL at ▇▇▇ ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or such other address as
XCL may specify upon five business days' prior notice in writing
to the registered holder of the Warrant evidenced hereby (the
"Warrant Office"). The Exercise Price is subject to adjustment
prior to the Expiration Date upon the occurrence of certain
events as set forth in the Warrant Agreement.
No Warrant may be exercised after 5:00 P.M., local time at
the Warrant Office, on the Expiration Date and all rights of the
registered holders of the Warrants shall cease after 5:00 P.M.,
local time at the Warrant Office, on the Expiration Date.
The Company may deem and treat the registered holders of the
Warrants evidenced hereby as the absolute owner thereof
(notwithstanding any notation of ownership or other writing
hereon made by anyone), for the purpose of any exercise hereof or
any distribution to the holders hereof, and for all other
purposes, and XCL shall not be affected by any notice to the
contrary.
This Warrant Certificate, when surrendered at the Warrant
Office may be exchanged, in the manner and subject to the
limitations provided in the Warrant Agreement, but without
payment of any service charge, for another Warrant Certificate of
like tenor, or for other Warrant Certificates, evidencing an
equivalent number of Warrants.
Subject to the provisions of Section 13 of the Warrant
Agreement, upon surrender of this Warrant Certificate at the
Warrant Office, one or more new duly executed Warrant
Certificates evidencing such transferred Warrants shall be issued
to the transferee(s) and, if less than all the Warrants evidenced
hereby are to be transferred, one or more new duly executed
Warrant Certificates evidencing, in the aggregate, the remaining
number of Warrants shall be issued to the registered holder
hereof, subject to the limitations provided in the Warrant
Agreement, without charge except for any tax or other
governmental charge imposed in connection therewith.
This Warrant Certificate is the Warrant Certificates
referred to in the Warrant Agreement. Such Warrant Agreement is
hereby incorporated by reference in and made a part of this
instrument and is hereby referred to for a description of the
rights, limitation of rights, obligations, duties and immunities
thereunder of XCL and the holders, and in the event of any
conflict between the terms of this Warrant Certificate and the
provisions of the Warrant Agreement, the provisions of the
Warrant Agreement shall control. XCL has certain obligations to
register the Warrant Stock at the time and subject to the terms
and conditions set forth in the Warrant Agreement.
This Warrant Certificate shall be governed by and construed
in accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, XCL has caused this Warrant Certificate
to be signed by its duly authorized officers and has caused its
corporate seal to be affixed hereunto.
XCL LTD.
By:_________________________
Title:______________________
(CORPORATE SEAL)
ATTEST:
____________________________
Assistant Secretary
ANNEX to Form
Of Warrant
Certificate
[FORM OF ELECTION TO PURCHASE]
(To be executed upon exercise of Warrant)
The undersigned hereby irrevocably elects to exercise
the right, represented by this Warrant Certificate, to purchase
shares of Warrant Stock and herewith tenders payment for such
Warrant Stock to the order of _____________________ in the amount
of $____________ in accordance with the terms of this Warrant
Certificate and the Warrant Agreement incorporated by reference
herein. If the number of Warrants exercised is less than the
number reflected in the Warrant Certificate, a certificate for
the balance of the Warrants is requested.
Signature:_____________________________________________
______
(Signature must conform in all respects to
name of holder as specified on the face of
the Warrant Certificate.)
Date:__________________