EXHIBIT 4.3
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EXECUTION COPY
WARRANT AGREEMENT
BETWEEN
EOTT ENERGY LLC
AND
EQUISERVE TRUST COMPANY, N.A.
AND
EQUISERVE, INC.
MARCH 1, 2003
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TABLE OF CONTENTS
Page
No.
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Section 1. Appointment of Warrant Agent....................................................................1
Section 2. Form of Warrant Certificates....................................................................1
Section 3. Issuance, Countersignature and Registration.....................................................2
Section 4. Transfer, Split Up, Combination and Exchange of Warrant Certificates;
Mutilated, Destroyed, Lost or Stolen Warrant Certificates.......................................2
Section 5. Subsequent Issue of Warrant Certificates........................................................3
Section 6. Exercise of Warrants; Exercise Price............................................................3
Section 7. Cancellation and Destruction of Warrant Certificates............................................4
Section 8. Availability of Common Units....................................................................4
Section 9. Common Unit Record Date.........................................................................5
Section 10. Adjustment of Exercise Price, Number of Common Units or Number
of Warrants.....................................................................................5
Section 11. Certification of Adjusted Exercise Price and Number of Common
Units Issuable..................................................................................8
Section 12. Consolidation, Merger or Sale of Assets.........................................................8
Section 13. Fractional Warrants and Fractional Common Units.................................................8
Section 14. Right of Action.................................................................................9
Section 15. Agreement of Warrant Certificate Holders........................................................9
Section 16. Concerning the Warrant Agent...................................................................10
Section 17. Merger or Consolidation or Change of Name of Warrant Agent.....................................11
Section 18. Duties of Warrant Agent........................................................................11
Section 19. Change of Warrant Agent........................................................................13
Section 20. Definitions....................................................................................13
Section 21. Notice of Proposed Actions.....................................................................15
Section 22. Notices........................................................................................15
Section 23. Supplements and Amendments.....................................................................16
Section 24. Successors.....................................................................................16
Section 25. Benefits of This Agreement.....................................................................16
Section 26. Governing Law..................................................................................17
Section 27. Counterparts...................................................................................17
Section 28. Inspection.....................................................................................17
Section 29. Descriptive Headings...........................................................................17
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WARRANT AGREEMENT
This Agreement ("AGREEMENT"), dated as of March 1, 2003, is made
between
EOTT Energy LLC, a
Delaware limited liability company (the "COMPANY"),
and EquiServe, Inc., a
Delaware corporation, and its fully owned subsidiary
EquiServe Trust Company, N.A., a federally chartered trust company
(collectively, the "WARRANT AGENT" or individually "EQI" and the "TRUST COMPANY"
respectively):
On October 8, 2002, the EOTT Energy Partners, L.P. ("EOTT ENERGY") and
certain subsidiaries of EOTT Energy filed the Bankruptcy Case (as hereinafter
defined) under chapter 11 of the Bankruptcy Code (has hereinafter defined).
Pursuant to the Joint Chapter 11 Plan filed by EOTT Energy and such
subsidiaries ("PLAN OF REORGANIZATION") and confirmed in connection with the
Bankruptcy Case, the former holders of common units issued by EOTT Energy became
entitled to receive, among other things, the Warrants issued under this
Warrant
Agreement.
The Company desires the Warrant Agent to act on behalf of the Company,
and the Warrant Agent is willing to act, in connection with the issuance,
transfer, exchange, replacement and exercise of the Warrant Certificates and
other matters as provided herein.
The Company has duly authorized the issuance of the Warrants under the
Plan of Reorganization and the execution and delivery of this
Warrant Agreement.
All things necessary have been done on the part of the Company to make
the Warrants, when issued and executed by the Company and authenticated and
delivered by the Warrant Agent as herein provided, the valid obligations of the
Company, in accordance with their respective terms.
Capitalized terms used herein and not otherwise defined shall have the
meanings, if any, given to such terms in Section 20 hereof.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
SECTION 1. APPOINTMENT OF WARRANT AGENT. The Company hereby appoints
the Warrant Agent to act as agent for the Company in accordance with the terms
and conditions hereinafter set forth, and the Warrant Agent hereby accepts such
appointment. The Company may from time to time appoint such co-warrant agents as
it may deem necessary or desirable.
SECTION 2. FORM OF WARRANT CERTIFICATES. The Warrant Certificates shall
be substantially in the form of Exhibit A hereto and may have such letters,
numbers or other marks of identification or designation and such legends
(including, without limitation, a legend referring to restrictions on resale by
statutory underwriters), summaries or endorsements printed, lithographed or
engraved thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
law or with any rule or regulation made pursuant thereto or with any rule or
regulation of any stock exchange or securities trading system on which the
Warrants may from time to time be listed or traded. The Company shall furnish to
Warrant Agent, in writing, any such legend or endorsement. Each Warrant
Certificate shall be dated as of the date on which countersigned by the Warrant
Agent, either upon initial issuance or upon transfer or exchange. Each Warrant
shall entitle the
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Holder thereof to purchase one Common Unit, subject to adjustment and at the
Exercise Price set forth herein, and subject to the other terms and conditions
set forth herein.
SECTION 3. ISSUANCE, COUNTERSIGNATURE AND REGISTRATION. The Warrants
shall originally be issued as of the Effective Date, subject to the terms and
conditions specified in the Plan, or at such other time or times as may be
provided in the Plan. The Warrant Agent shall, upon the Company's written
instructions, issue, countersign and deliver Warrant Certificates to, or on
written order of, the Company. The Warrant Certificates shall have been executed
on behalf of the Company by the Chief Executive Officer, President or a Vice
President, by facsimile signature, and shall be attested to by its Secretary or
an Assistant Secretary by facsimile signature. The Warrant Certificates shall be
manually countersigned by the Warrant Agent and shall not be valid for any
purpose unless so countersigned. In case any officer of the Company who shall
have signed any of the Warrant Certificates shall cease to be such officer of
the Company before countersignature by the Warrant Agent and issuance and
delivery by the Company, such Warrant Certificates, nevertheless, may be
countersigned by the Warrant Agent, issued and delivered with the same force and
effect as though the Person who signed such Warrant Certificates had not ceased
to be such officer of the Company; and any Warrant Certificate may be signed on
behalf of the Company by any Person who, at the actual date of the execution of
such Warrant Certificate, shall be a proper officer of the Company to sign such
Warrant Certificate, although at the date of the execution of this
Warrant
Agreement any such Person was not such an officer. Each Warrant Certificate
shall when countersigned by the Warrant Agent entitle the Holder thereof to
exercise the rights as the Holder of the number of Warrants set forth thereon,
subject to the provisions of this Agreement.
The Warrant Agent will maintain a Warrant register for registration and
transfer of the Warrant Certificates issued hereunder. Such Warrant register
shall show the names and addresses of the respective Holders of the Warrant
Certificates, the number of Warrants evidenced on its face by each of the
Warrant Certificates, and the date of issuance of each of the Warrant
Certificates.
Notwithstanding any other provision of this Agreement, the Warrant
Agent shall comply with all applicable requirements and rules of each securities
exchange or securities trading system on which the Company shall determine to
list or trade the Warrants in connection with the listing or trading of the
Warrants on each such exchange. The Company shall advise the Warrant Agent of
each securities exchange or securities trading system on which listing is
effected.
SECTION 4. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF WARRANT
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN WARRANT CERTIFICATES. Subject
to the provisions of Section 13 hereof, any Warrant Certificate may be
transferred, split up, combined or exchanged for another Warrant Certificate or
Warrant Certificates, entitling the Holder to purchase a like number of Common
Units as the Warrant Certificate or Warrant Certificates surrendered then
entitled him to purchase. Any Holder desiring to transfer, split up, combine or
exchange any Warrant Certificate shall make such request in writing delivered to
the Warrant Agent, and shall surrender the Warrant Certificate or Warrant
Certificates to be transferred, split up, combined or exchanged at the principal
office of the Warrant Agent or at its facility retained for such purpose at
EquiServe Trust Company N.A., c/o
EOTT Energy LLC, Transfer Operations, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ (781) 575-2726. Thereupon, the Company shall have
such other Warrant Certificate or Warrant Certificates signed as provided in
Section 3 and the Warrant Agent shall countersign and deliver to the Person
entitled thereto such Warrant Certificate or Warrant Certificates, as the case
may be, as so requested. The Company may require payment by the Holder of the
Warrant of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer, split up, combination or exchange of
Warrant Certificates.
Upon receipt by the Company and the Warrant Agent of evidence
satisfactory to them of the loss, theft, destruction or mutilation of a Warrant
Certificate, and, in case of loss, theft or destruction, of
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indemnity or security reasonably satisfactory to them (including with respect to
the amount of such indemnity or security), and reimbursement by the Holder of
the Warrant to the Company and the Warrant Agent of all expenses incidental
thereto, and upon surrender and cancellation of the Warrant Certificate if
mutilated, the Company will make and deliver a new Warrant Certificate of like
tenor and for a like aggregate number of Warrants to the Warrant Agent for
countersignature and delivery to the Holder in lieu of the Warrant Certificate
so lost, stolen, destroyed or mutilated. Applicants for substitute Warrants
shall also comply with such other regulations and pay such other charges
(including, without limitation, tax and/or governmental charges) as the Company
may prescribe. Every new Warrant Certificate executed and delivered pursuant to
this Section in lieu of any lost, stolen, or destroyed Warrant Certificate shall
be entitled to the same benefits of this Agreement equally and proportionately
with any and all other Warrant Certificates, whether or not the allegedly lost,
stolen or destroyed Warrant Certificate shall be at any time enforceable by
anyone. The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights or remedies with respect to the replacement of
mutilated, lost, stolen or destroyed Warrant Certificates.
SECTION 5. SUBSEQUENT ISSUE OF WARRANT CERTIFICATES. Subsequent to
their original issuance, no Warrant Certificates shall be issued except (a)
Warrant Certificates issued upon any transfer, combination, split up or exchange
of Warrants pursuant to Section 4 hereof, (b) Warrant Certificates issued in
replacement of mutilated, destroyed, lost or stolen Warrant Certificates
pursuant to Section 4 hereof, and (c) Warrant Certificates issued pursuant to
Section 6 hereof upon the partial exercise of any Warrant to evidence the
unexercised portion of such Warrant. Except as expressly provided herein,
nothing contained in this Agreement shall prohibit or limit the Company from
issuing from time to time additional options, warrants or other derivative
securities representing the right to purchase Common Units.
SECTION 6. EXERCISE OF WARRANTS; EXERCISE PRICE.
(a) The Holder of any Warrant Certificate may exercise the Warrants
evidenced thereby in whole or in part after the Initial Exercise Date during
normal business hours on any business day upon surrender of the Warrant
Certificate with the form of election to purchase on the reverse side thereof
duly executed to the Warrant Agent at its facility maintained for such purpose
at EquiServe Trust Company N.A., c/o
EOTT ENERGY LLC, Corporate Actions, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, (▇▇▇)▇▇▇-▇▇▇▇ or at the principal office of the
Warrant Agent, if then different, together with payment of the Exercise Price
for each Common Unit as to which the Warrants are exercised, at or prior to 5:00
p.m. (New York time) on the Expiration Date. On the Expiration Date, all
unexercised Warrants shall automatically terminate and cease to be of any
further force or effect, and all rights under any outstanding Warrant
Certificates shall cease.
(b) The Exercise Price for each Common Unit pursuant to the exercise of
a Warrant shall be $12.50 per Common Unit. The Exercise Price shall be subject
to adjustment as provided in Section 10 hereof and shall be payable only in the
consideration specified in paragraph (c) immediately below.
(c) Upon receipt of a Warrant Certificate, with the form of election to
purchase duly executed, accompanied by payment, in cash, or by certified check,
bank draft or postal or express money order payable to the order of the Company,
of the Exercise Price for the Common Units to be purchased and an amount equal
to any applicable transfer tax, the Warrant Agent shall thereupon promptly: (i)
demand from the transfer agent of the Common Units of the Company certificates
for the number of whole Common Units to be purchased and the Company hereby
authorizes its transfer agent to comply with such requests, (ii) when
appropriate, demand from the Company the amount of cash to be paid in lieu of
issuance of fractional Common Units, and (iii) after receipt of such
certificates cause the same to be delivered to or upon the order of the Holder
of such Warrant Certificate, registered in such name or
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names as may be designated by such Holder, and, when appropriate, after receipt
promptly deliver such cash to or upon the order of the Holder of such Warrant
Certificate. Each exercise of any Warrant shall be deemed to have been effected
immediately prior to the close of business on the business day on which the
Warrant Certificate representing such Warrant, a duly executed election to
purchase and payment of the Exercise Price shall have been delivered as provided
in this Section 6, and at such time the Holder in whose name the certificate for
the Common Units shall be issuable upon such exercise shall be deemed to have
become the Holder of record thereof.
(d) In case the Holder of any Warrant Certificate shall exercise less
than all the Warrants evidenced thereby, a new Warrant Certificate evidencing
Warrants equivalent to the Warrants remaining unexercised shall be issued by the
Warrant Agent to the Holder of such Warrant Certificate or to his duly
authorized assigns, subject to the provisions of Section 13 hereof.
(e) Nothing herein shall be deemed to restrict the Company from
purchasing or otherwise acquiring Warrants at such times, in such manner and for
such consideration as it may deem appropriate.
(f) Notwithstanding any of the provisions of this Agreement or of the
Warrant Certificates to the contrary, the Company may, at its option, issue
replacement Warrant Certificates evidencing Warrants in such form as may be
approved by the Board of Directors of the Company to reflect any adjustment or
change in the Exercise Price per Common Unit and the number or kind or class of
Company securities or other securities or property purchasable under the several
Warrant Certificates made in accordance with the provisions of this Agreement.
(g) Notwithstanding any of the provisions of this Agreement or the
Warrant Certificates to the contrary, if any applicable law or any rule,
regulation or order of the Securities and Exchange Commission or other
governmental entity having jurisdiction requires the registration of the Common
Units or other securities to be issued upon exercise of a Warrant, (i) the
Warrant shall not be exercisable until the registration of such Common Units or
other securities is effected and (ii) the Company shall use commercially
reasonable efforts to effect a registration statement covering such Common Units
or other securities as soon as reasonably practicable.
SECTION 7. CANCELLATION AND DESTRUCTION OF WARRANT CERTIFICATES. All
Warrant Certificates surrendered for the purpose of exercise (in whole or in
part), exchange, transfer, split up, combination or substitution if mutilated
shall, if surrendered to the Company or to any of its agents, be delivered to
the Warrant Agent for cancellation or in cancelled form, or if surrendered to
the Warrant Agent shall be cancelled by it, and no Warrant Certificates shall be
issued in lieu thereof except as expressly permitted by any of the provisions of
this Agreement. If the Company purchases or acquires Warrants and if the Company
so chooses, the Company may deliver to the Warrant Agent for cancellation and
retirement, and the Warrant Agent shall so cancel and retire, the Warrant
Certificates evidencing said Warrants. The Warrant Agent shall retain all
cancelled Warrant Certificates for a period of one year and return the cancelled
certificates to the Company.
SECTION 8. AVAILABILITY OF COMMON UNITS. The Company covenants and
agrees that it will cause to be kept available for issuance the number of Common
Units that will be sufficient to permit the exercise in full of all outstanding
Warrants.
The Company covenants and agrees that it will take all such action as
may be necessary to ensure that all Common Units delivered upon the exercise of
Warrants shall, at the time of delivery of the certificates for such Common
Units (subject to payment of the Exercise Price and compliance with all other
provisions of this Agreement), be duly and validly authorized and issued and
fully paid and nonassessable Common Units.
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The Holder shall pay all expenses in connection with, and all taxes and
other governmental charges that may be imposed with respect to, the issue or
delivery of Common Units issuable upon the exercise of any Warrant. The Company
shall not be required to pay tax or other charge imposed in connection with any
transfer involved in the issuance of any certificate evidencing the Common Units
issuable upon exercise of the Warrants in any name other than that of the Holder
of the Warrant Certificate evidencing such Warrants and in such case the Warrant
Agent and the Company shall not be required to issue any certificates for Common
Units or pay any cash until such tax or other change has been paid or it has
been established to the Warrant Agent's and the Company's satisfaction that no
such tax or charge is due.
SECTION 9. COMMON UNIT RECORD DATE. Each Person in whose name any
certificate for Common Units is issued upon the exercise of Warrants shall for
all purposes be deemed to have become the holder of record of the Common Units
represented thereby, and such certificates shall be dated as of the exercise
date, which is the date upon which the Warrant Certificate evidencing such
Warrants was duly surrendered and payment of the Exercise Price (and any
applicable transfer taxes) was made; provided, however, that if such exercise
date is a date upon which the Common Unit transfer books of the Company are
closed, such Person shall be deemed to have become the record holder of such
Common Units on, and such certificate shall be dated, the next succeeding
business day on which the Common Unit transfer books of the Company are open.
Prior to the exercise of any Warrant, no Holder of a Warrant
Certificate shall be entitled to vote or receive distributions or be deemed for
any purpose the holder of Common Units or of any other securities of the Company
which may at any time be issuable on the exercise thereof, nor shall anything
contained in this Agreement be construed to confer upon the Holder thereof, as
such, any of the rights of a holder of the Common Units of the Company or any
right to vote upon any matter submitted to holders of the Common Units at any
meeting thereof, or to give or withhold consent to any Company action (whether
upon any recapitalization, issuance of Common Units, reclassification of Units,
consolidation, merger, conveyance, or otherwise) or, except as provided in this
Agreement, to receive notice of meetings, or to receive dividends or
distributions or subscription rights or otherwise, until the Warrant or Warrants
evidenced by the Warrant Certificate shall have been exercised as provided in
this Agreement.
SECTION 10. ADJUSTMENT OF EXERCISE PRICE, NUMBER OF COMMON UNITS OR
NUMBER OF WARRANTS. The Exercise Price, the number of Common Units covered by
each Warrant and the number of Warrants outstanding are subject to adjustment
from time to time upon the occurrence of the events enumerated in this Section
10.
(a) In case the Company shall at any time after the date of
this Agreement (i) pay dividends or distributions on the Common Units
in Common Units, (ii) subdivide or split up the outstanding Common
Units into a greater number of Common Units, (iii) combine or effect a
reverse split of the outstanding Common Units into a smaller number of
Common Units, or (iv) issue any Common Units in a reclassification of
the Common Units (other than in a transaction covered by Section 12),
the Exercise Price in effect at the time immediately prior to such
dividend, distribution, issuance, subdivision, split up, reverse split,
or combination, and the number of and kind of Common Units issuable at
such time upon exercise of the Warrants shall be proportionately
adjusted so that the Holder of any Warrant exercised after such time
shall be entitled to receive the aggregate number and kind of Common
Units which, if such Warrant had been exercised immediately prior to
such time, he would have owned upon such exercise and been entitled to
receive by virtue of such dividend, distribution, subdivision, split
up, reverse split, combination, or issuance, subject to the provisions
of Section 10(e) hereof. Such adjustment shall be made successively
whenever any event listed above shall occur.
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(b) In case the Company shall distribute rights, options or
warrants to all holders of Common Units entitling them to subscribe for
or purchase Common Units (or securities convertible into Common Units),
other than any transaction covered by Section 10(a) or Permitted
Issuances, at a price per Common Unit (or having a conversion price per
Common Unit, if a security convertible into Common Units) less than
ninety percent (90%) of the Current Market Price per Common Unit on the
date of such distribution, then the Exercise Price to be in effect
after such distribution shall be determined by multiplying the Exercise
Price immediately prior to such distribution by a fraction, of which
the numerator shall be the number of Common Units outstanding
immediately prior to such distribution plus the number of Common Units
which the aggregate offering price of the total number of Common Units
so to be offered (or the aggregate initial conversion price of the
convertible securities so to be offered) would purchase at such Current
Market Price and of which the denominator shall be the number of Common
Units outstanding immediately prior to such distribution plus the
number of additional Common Units so to be offered for subscription or
purchase (or into which the convertible securities to be offered are
initially convertible). 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 by the
Board of Directors, whose determination shall be conclusive, and
described in a statement filed with the Warrant Agent. Common Units
owned by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such adjustment
shall be made successively whenever such a distribution occurs, subject
to Section 10(d) hereof. No further adjustments of the Exercise Price
shall be made upon the actual issuance of Common Units upon exercise of
such rights, options or warrants (or the conversion of such convertible
securities); provided, however, that in the event any such rights,
options or warrants are not exercised (or, in the case of convertible
securities, are not converted) prior to the respective expiration dates
thereof, then, on each such expiration date, the Exercise Price shall
be readjusted to reverse the adjustment made pursuant to this Section
10(b) in respect of such number(s) of rights, options or warrants that
were not exercised (or, in the case of convertible securities, were not
converted) prior to such expiration date. Notwithstanding anything to
the contrary set forth in this Section 10(b), in the event the Company
shall distribute any rights, options or warrants to subscribe for or
purchase Common Units or any securities convertible into Common Units
(other than Permitted Issuances or any transaction covered by Section
10(a)) pursuant to any so-called "poison pill" or shareholders' rights
or similar plan or agreement, the distribution of separate certificates
representing such rights, options or warrants subsequent to their
initial distribution shall be deemed to be the distribution thereof for
purposes of this Section 10(b); provided that the Company may, in lieu
of making any adjustment pursuant to this Section 10(b) upon such a
distribution of separate certificates, make proper provision so that
each Holder of Warrants who exercises such Warrants (or any portion
thereof) (i) after such initial distribution but before such
distribution of separate certificates shall be entitled to receive upon
such exercise Common Units issued with such rights, options or warrants
and (ii) after such distribution of separate certificates and prior to
the expiration, redemption or termination of such rights, options or
warrants shall be entitled to receive upon such exercise, in addition
to the Common Units issuable upon such exercise, the same number of
such rights, options or warrants as would have accompanied such Common
Units had such Warrants been exercised immediately prior to such
distribution of separate certificates.
(c) In case the Company shall distribute to all holders of
Common Units evidences of indebtedness, assets or rights, options or
warrants to subscribe for or purchase any evidences of indebtedness,
rights, options, warrants or assets (other than Permitted Issuances,
cash distributions and those distributions referred to in Sections
10(a) and 10(b) hereof), the Exercise Price to be in effect after such
distribution shall be determined by multiplying the Exercise Price
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in effect immediately prior to such distribution by a fraction, of
which the numerator shall be the Current Market Price per Common Unit
on the date of such distribution, less the fair market value (as
determined by the Board of Directors of the Company, whose
determination shall be conclusive, and described in a statement filed
with the Warrant Agent) of the portion of the assets, evidences of
indebtedness, rights, options or warrants so to be distributed,
applicable to one Common Unit, and of which the denominator shall be
such Current Market Price per Common Unit. Such adjustments shall be
made successively whenever such a distribution occurs, subject to
Section 10(d) hereof.
(d) No adjustment in the Exercise Price shall be required
unless such adjustment, together with any amount being carried forward
as hereinafter provided, would require an increase or decrease of at
least 1% in such price; provided, however, that any adjustments which
by reason of this Section 10(d) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 10 shall be made to the nearest
cent or to the nearest one-hundredth of a Common Unit, as the case may
be. Notwithstanding the first sentence of this Section 10(d), any
adjustment required by this Section 10 shall be made no later than the
expiration of the right to exercise any Warrant.
(e) In the event that at any time, as a result of an
adjustment made pursuant to Section 10(a) hereof, the Holder of any
Warrant thereafter exercised shall become entitled to receive any
securities of the Company other than Common Units, thereafter the
number of such other securities 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 Common Units contained in Section 10(a) through (c)
hereof, inclusive, and the provision of this Agreement with respect to
the Common Units shall apply on like terms to any such other
securities.
(f) Irrespective of any adjustments in the Exercise Price or
the number of Common Units issuable upon the exercise of Warrants,
Warrant Certificates theretofore or thereafter issued may continue to
express the Exercise Price and the number of Common Units as are stated
in the Warrant Certificates issuable initially, or at some subsequent
time, pursuant to this Agreement, and the Exercise Price and such
number of Common Units specified thereon shall be deemed to have been
so adjusted.
(g) Upon each adjustment of the Exercise Price as a result of
the calculations made in Section 10(b) or 10(c) hereof, each Warrant
outstanding immediately prior to the making of such adjustment shall
thereafter be deemed to evidence the right to purchase, at the adjusted
Exercise Price, that number of Common Units (calculated to the nearest
one-hundredth) obtained by (i) multiplying the number of Common Units
covered by a Warrant immediately prior to this adjustment of the number
of Common Units by the Exercise Price in effect immediately prior to
such adjustment of the Exercise Price and (ii) dividing the product so
obtained by the Exercise Price in effect immediately after such
adjustment of the Exercise Price.
(h) Anything in this Section 10 to the contrary
notwithstanding, the Company shall be entitled to make such reductions
in the Exercise Price, in addition to those adjustments required by
this Section 10, as it in its sole discretion shall determine to be
advisable in order that the following action shall not be taxable to
the holders of Common Units: (i) any consolidation or subdivision of
the Common Units, (ii) issuance to such holders of Common Units wholly
for cash of any Common Units at less than the Current Market Price,
(iii) issuance to such holders of Common Units wholly for cash of
Common Units or securities which by their terms are convertible into or
exchangeable for Common Units, (iv) any Common Unit distribution to
such
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holders of Common Units or (v) issuance to such holders of Common Units
of rights, options or warrants referred to hereinabove in this Section
10.
SECTION 11. CERTIFICATION OF ADJUSTED EXERCISE PRICE AND NUMBER OF
COMMON UNITS ISSUABLE. Whenever the Exercise Price and the number of Common
Units issuable upon the exercise of each Warrant are adjusted as provided in
Section 10 above, the Company shall (a) promptly file with the Warrant Agent and
with the transfer agent for the Common Units a copy of a certificate setting
forth the Exercise Price as so adjusted, the number of Common Units issuable
upon the exercise of each Warrant as so adjusted, and a brief statement of the
facts accounting for such adjustment, and (b) mail a brief summary thereof to
each Holder of a Warrant Certificate at the time of such mailing. At the
Company's request, the Warrant Agent shall give such notice under paragraph (b)
in the preceding sentence in the Company's name and at its expense. Failure to
give such notice, or any defect therein, shall not affect the legality or
validity of any action referred to in Section 10 hereof. If the Company shall
take a record of the holders of its Common Units for the purpose of entitling
them to receive a dividend or distribution, and shall thereafter, and before the
distribution to the holders of the Common Units thereof, legally abandon its
plan to pay or deliver such dividend or distribution, then thereafter no
adjustment in the number of the Common Units purchasable upon exercise of the
Warrants or in the Exercise Price then in effect shall be required by reason of
the taking of such record and, as to any Warrants that remain outstanding, any
adjustment previously made in respect thereof shall be rescinded and annulled.
SECTION 12. CONSOLIDATION, MERGER OR SALE OF ASSETS. If (i) the Company
shall at any time reorganize, consolidate with or merge with or into another
Entity and (ii) the Common Units are exchanged, cancelled or reclassified in
connection with such transaction, the Holder of any outstanding Warrants will
thereafter receive, upon the exercise thereof in accordance with the terms of
this Agreement, the securities, property or cash to which the holder of the
number of Common Units deliverable upon the exercise of such Warrants
immediately prior to such transaction would have been entitled upon such
consolidation or merger, and the Company shall take such steps in connection
with such reorganization, consolidation or merger as may be necessary to assure
that the provisions hereof shall thereafter be applicable, as nearly as
reasonably may be, in relation to any securities or property thereafter
deliverable upon the exercise of the Warrants. Prior to or simultaneously with
such transaction, the Company or the successor Entity, as the case may be, shall
execute and deliver to the Warrant Agent a supplemental agreement so providing.
A sale or lease of all or substantially all of the assets of the Company for a
consideration (apart from the assumption of obligations) consisting primarily of
securities shall be deemed a reorganization, consolidation or merger for the
purpose of clause (i) of the first sentence of this Section 12. The provisions
of this Section 12 shall similarly apply to successive reorganizations, mergers
or consolidations or sales or other transfers.
8
SECTION 13. FRACTIONAL WARRANTS AND FRACTIONAL COMMON UNITS.
(a) The Company shall not be required to issue Warrant Certificates
which evidence Warrants to purchase fractional Common Units. If the Company so
elects, in lieu of such fractional Warrants, there shall be paid to the Holders
of the Warrant Certificates with regard to which such fractional Warrants would
otherwise be issuable, an amount in cash equal to the same fraction of the
current market value of a Warrant to purchase a whole Common Unit. For the
purpose of this Section 13(a), the current market value of a Warrant to purchase
a whole Common Unit shall be the closing price of the Warrant for the trading
day immediately prior to the date on which such fractional Warrant would have
been otherwise issuable, or if the Warrants are then neither publicly traded on
any established securities market nor quoted on any recognized system, the value
determined in good faith by the Board of Directors of the Company in its
discretion (which determination shall be conclusive). The closing price for any
date shall be determined as provided in the definition of "Current Market Price"
in Section 20 hereof, the references to Common Units therein being deemed
references to Warrants.
(b) Notwithstanding an adjustment pursuant to Section 10(a) or 10(g)
hereof in the number of Common Units covered by a Warrant, the Company shall not
be required to issue fractions of Common Units upon exercise of the Warrants or
to distribute certificates which evidence fractional Common Units. In lieu of
fractional Common Units, at the Company's election, there shall be paid to the
Holders of Warrants at the time such Warrants are exercised as herein provided
an amount of cash equal to the same fraction of the current market value of a
Common Unit. If more than one Warrant Certificate shall be surrendered for
exercise of the Warrants represented thereby at any one time by the same Holder,
the number of Common Units which shall be issuable on exercise thereof shall be
computed on the basis of the aggregate number of Common Units issuable on such
exercise. For purposes of this Section 13(b), the current market value of a
Common Unit shall be determined as provided in the definition of "Current Market
Price" in Section 20 hereof) for the trading day immediately prior to the date
of such exercise.
(c) The Holder of a Warrant, by the acceptance of the Warrant,
expressly waives any right to receive any fractional Warrant or any fractional
Common Unit upon exercise of a Warrant.
SECTION 14. RIGHT OF ACTION. All rights of action in respect of this
Agreement are vested in the respective Holders of the Warrant Certificates;
provided, however, that no Holder of any Warrant Certificate shall have the
right to enforce, institute or maintain any suit, action or proceeding against
the Company to enforce, or otherwise act in respect of, the Warrants evidenced
by such Warrant Certificate, unless (a) such Holder shall have previously given
written notice to the Company of the substance of such dispute, and Holders of
at least twenty-five percent of the then outstanding Warrants shall have given
written notice to the Company of their support for the institution of such
proceeding to resolve such dispute, (b) written notice of the substance of such
dispute and of the support for the institution of such proceeding by such
Holders shall have been provided by the Company to the Warrant Agent, and (c)
the Warrant Agent shall not have instituted appropriate proceedings with respect
to such dispute within thirty (30) days following the date of such written
notice to the Warrant Agent, it being understood and intended that no one or
more Holders of Warrant Certificates shall have the right in any manner whatever
by virtue of, or by availing of, any provision of this Agreement to affect,
disturb or prejudice the rights of any other Holders of Warrant Certificates, or
to obtain or to seek to obtain priority in preference over any other Holders or
to enforce any right under this Agreement, except in the manner herein provided
for the equal and ratable benefit of all Holders of Warrant Certificates. Except
as provided in this Section 14, no Holder of a Warrant Certificate shall have
the right to enforce, institute or maintain any suit, action or proceeding to
enforce, or otherwise act in respect of, the Warrants.
SECTION 15. AGREEMENT OF WARRANT CERTIFICATE HOLDERS. Every Holder of a
Warrant Certificate by accepting the same consents and agrees with the Company
and the Warrant Agent and with every other Holder of a Warrant Certificate that:
9
(a) the Warrant Certificates are transferable only on the
Warrant register of the Warrant Agent and if surrendered at the
principal office of the Warrant Agent or at its facility retained for
such purpose at EquiServe Trust Company N.A., c/o
EOTT Energy LLC,
Transfer Operations, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇, ▇▇▇▇▇,
(▇▇▇)▇▇▇-▇▇▇▇, duly endorsed or accompanied by an instrument of
transfer in form and substance satisfactory to the Company and the
Warrant Agent;
(b) the Company and the Warrant Agent may deem and treat the
Person in whose name each Warrant Certificate is registered as the
absolute owner in fact thereof and of the Warrants evidenced thereby
(notwithstanding any notations of ownership or writing on the Warrant
Certificates made by anyone other than the Company or the Warrant
Agent) for all purposes whatsoever, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary;
(c) except as provided in Section 14, no Holder of a Warrant
Certificate shall have the right to enforce, institute or maintain any
suit, action or proceeding to enforce, or otherwise act in respect of,
the Warrants; and
(d) the Warrant Agent is solely the agent of the Company
hereunder.
SECTION 16. CONCERNING THE WARRANT AGENT. The Company agrees to pay to
the Warrant Agent from time to time compensation for all services rendered by it
hereunder as the Company and Warrant Agent may agree from time to time, and,
from time to time, on demand of the Warrant Agent, its reasonable expenses and
counsel fees and other disbursements reasonably incurred in the administration
and execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Warrant Agent for, and to
hold it harmless against, any loss, claim, liability, or expense, incurred
without gross negligence, willful misconduct or bad faith on the part of the
Warrant Agent, arising out of or in connection with the acceptance and
administration of this Agreement, including the costs and expenses of defending
against any claim or liability arising out of or resulting from the acceptance
and administration of this Agreement or in connection with the exercise or
performance of any of its powers or duties hereunder.
The Warrant Agent shall be protected and shall incur no liability for
or in respect of any action taken, suffered, or omitted by it in connection with
its administration of this Agreement in reliance upon any Warrant Certificate or
certificate for Common Units or for other securities of the Company, instrument
of assignment or transfer, power of attorney, endorsement, affidavit, letter,
notice, direction, consent, certificate, statement, or other paper or document
in good faith believed by it to be genuine and to be signed, executed and, where
necessary, verified and acknowledged, by the proper Person or Persons.
The Warrant Agent shall account promptly to the Company with respect to
Warrants exercised and concurrently pay to the Company all immediately available
funds received by the Warrant Agent for the purchase of the Common Units through
the exercise of such Warrants. The Warrant Agent shall, upon request of the
Company from time to time, promptly deliver to the Company such complete reports
of registered ownership of the Warrants and such complete records or
transactions with respect to the Warrants and the Common Units as the Company
may request. The Warrant Agent shall also make available to the Company for
inspection by the Company's agents or employees, from time to time as the
Company may request, such original books of accounts and records maintained by
the Warrant Agent in connection with the issuance and exercise of Warrants
hereunder, such inspections to occur at the Warrant Agent's principal office.
The Warrant Agent shall keep copies of this
Warrant Agreement and any notices
10
given or received hereunder available for inspection by the Company or the
Holders at the Warrant Agent's principal office.
SECTION 17. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT.
Any corporation into which the Warrant Agent or any successor Warrant Agent may
be merged or with which it may be consolidated, or any corporation resulting
from any merger or consolidation to which the Warrant Agent or any successor
Warrant Agent shall be a party, or any corporation succeeding to the corporate
trust business of Warrant Agent or any successor Warrant Agent, shall be the
successor to the Warrant Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
provided that such corporation would be eligible for appointment as successor
Warrant Agent under the provisions of Section 19 hereof. In case at the time
such successor Warrant Agent shall succeed to the agency created by this
Agreement, any of the Warrant Certificates shall have been countersigned but not
delivered, any such successor Warrant Agent may adopt the countersignature of
the predecessor Warrant Agent and deliver such Warrant Certificates
countersigned; and in case at the time any of the Warrant Certificates shall not
have been countersigned, any successor Warrant Agent may countersign such
Warrant Certificates either in the name of the predecessor Warrant Agent or in
the name of the successor Warrant Agent; and in all such cases such Warrant
Certificates shall have the full force provided in the Warrant Certificates and
in this Agreement.
In case at any time the name of the Warrant Agent shall be changed and
at such time any of the Warrant Certificates shall have been countersigned but
not delivered, the Warrant Agent may adopt the countersignature under its prior
name and deliver Warrant Certificates so countersigned; and in case at that time
any of the Warrant Certificates shall not have been countersigned, the Warrant
Agent may countersign such Warrant Certificates either in its prior name or in
its changed name; and in all such cases such Warrant Certificates shall have the
full force provided in the Warrant Certificates and in this Agreement.
SECTION 18. DUTIES OF WARRANT AGENT. The Warrant Agent accepts the
agency established by this Agreement and agrees to perform the specific duties
and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the Holders of Warrant Certificates,
by their acceptance thereof, shall be bound:
(a) The Warrant Agent may consult with legal counsel (who may
be legal counsel for the Company), and the opinion of such counsel
shall be full and complete authorization and protection to the Warrant
Agent as to any action taken or omitted by it in good faith and in
accordance with such opinion, provided the Warrant Agent shall have
exercised reasonable care in the selection by it of such counsel.
(b) Whenever in the performance of its duties under this
Agreement, the Warrant Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Company prior to
taking or suffering any action hereunder, such fact or matter may, in
the absence of bad faith on the part of the Warrant Agent, be deemed to
be conclusively proved and established by a certificate signed by the
President or a Vice President of the Company and delivered to the
Warrant Agent; and such certificate, in the absence of bad faith on the
part of the Warrant Agent, shall be full authorization to the Warrant
Agent for any action taken or suffered by it under the provisions of
this Agreement in reliance upon such certificate.
(c) The Warrant Agent shall be liable hereunder only for its
own gross negligence, willful misconduct or bad faith.
11
(d) The Warrant Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Agreement
or in the Warrant Certificates (except such as describe the Warrant
Agent and its countersignature thereof or any action taken by the
Warrant Agent) or be required to verify the same, but all such
statements and recitals are and shall be deemed to have been made by
the Company only.
(e) The Warrant Agent shall not be under any responsibility in
respect of and makes no representation as to the validity of this
Agreement or the execution and delivery hereof (except the due
execution and delivery hereof by the Warrant Agent) or in respect of
the validity or execution of any Warrant Certificate (except for its
countersignature thereof); nor shall it be responsible for any breach
by the Company of any covenant or condition contained in this Agreement
or in any Warrant Certificate; nor shall it by any act hereunder be
deemed to make any representation or warranty as to the authorization
of any Common Units to be issued pursuant to this Agreement or any
Warrant Certificate or as to whether any Common Units will, when issued
be validly authorized and issued, fully paid and nonassessable.
(f) The Warrant Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties
hereunder from the Chief Executive Officer, President or a Vice
President of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable
for any action taken or suffered to be taken by it in good faith in
accordance with instructions of any such officer.
(g) The Warrant Agent and any shareholder, director, officer
or employee of the Warrant Agent may buy, sell or deal in any of the
Warrants or other securities of the Company or become pecuniarily
interested in any transaction in which the Company may be interested,
or contract with or lend money to the Company or otherwise act as fully
and freely as though it were not Warrant Agent under this Agreement, so
long as such Persons do so in full compliance with all applicable laws.
Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company or for any other legal Entity.
(h) The Warrant Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder
either itself (through its employees) or by or through its attorneys or
agents (which shall not include its employees); provided, that due care
has been exercised in the appointment and continued employment thereof.
(i) The Warrant Agent shall act solely as the agent of the
Company hereunder. The Warrant Agent shall not be liable except for the
failure to perform such duties as are specifically set forth herein and
except for its own gross negligence, bath faith or willful misconduct,
and no implied covenants or obligations shall be read into this
Agreement against the Warrant Agent, whose duties shall be determined
solely by the express provisions hereof.
(j) The Warrant Agent shall not have any duty to calculate or
determine any adjustments with respect either to the Exercise Price or
the kind and amount of Common Units or other securities or any property
receivable by Holders of Warrant Certificates upon the exercise of
Warrants required from time to time, and the Warrant Agent shall have
no duty or responsibility in determining the accuracy or correctness of
such calculations.
(k) The Warrant Agent shall not be responsible for any failure
on the part of the Company to comply with any of its covenants and
obligations contained in this Agreement or in the Warrant Certificates.
12
(l) The Warrant Agent shall not be under any obligation or
duty to institute, appear in or defend any action, suit or legal
proceeding in respect hereof, unless first indemnified to its
satisfaction, but this provision shall not affect the power of the
Warrant Agent to take such action as the Warrant Agent may consider
proper, whether with or without such indemnity. The Warrant Agent shall
promptly notify the Company in writing of any claim made or action,
suit or proceeding instituted against it arising out of or in
connection with this Agreement.
(m) The Company will perform, execute, acknowledge and deliver
or cause to be performed, executed, acknowledged and delivered all such
further acts, instruments or assurances as may be reasonably required
by the Warrant Agent in order to enable it to carry out or perform its
duties under this Agreement.
SECTION 19. CHANGE OF WARRANT AGENT. The Warrant Agent may resign and
be discharged from its duties after 30 days' prior notice in writing is mailed
to the Company by registered or certified mail, return receipt requested, and to
the Holders of the Warrant Certificates by first-class mail at the expense of
the Company, upon (but only upon) a duly appointed successor Warrant Agent or
interim Warrant Agent having been appointed and having accepted such appointment
in writing as provided hereinafter. The Company may remove the Warrant Agent or
any successor Warrant Agent after 30 days' prior notice in writing is mailed to
the Warrant Agent or successor Warrant Agent, as the case may be, and to the
transfer agent of the Common Units by registered or certified mail, return
receipt requested, and to the Holders of the Warrant Certificates by first-class
mail, upon (but only upon) a duly appointed successor Warrant Agent or interim
Warrant Agent having been appointed and having accepted such appointment in
writing as provided hereinafter. If the Warrant Agent shall resign or be removed
or shall otherwise become incapable of acting, the Company shall promptly
appoint a successor to the Warrant Agent, which the Company may designate as an
interim Warrant Agent. If the Company appoints an interim Warrant Agent, the
Company shall then appoint a permanent successor to the Warrant Agent, which may
be the interim Warrant Agent. If the Company shall fail to make such appointment
of a permanent successor within a period of 30 days after such removal or within
60 days after it has been notified in writing of such resignation or incapacity
by the resigning or incapacitated Warrant Agent or by the Holder of a Warrant
Certificate (who shall, with such notice, submit his Warrant Certificate for
inspection by the Company), then the Warrant Agent or Holder of any Warrant
Certificate may apply to any court of competent jurisdiction for the appointment
of a successor Warrant Agent. Any successor Warrant Agent, whether appointed by
the Company or by such a court, shall be a corporation organized and doing
business under the laws of the United States or of any State of the United
States, in good standing, which is authorized under such laws to exercise
corporate trust powers and is subject to supervision or examination by federal
or state authority and which has at the time of its appointment as Warrant Agent
a combined capital and surplus of at least $100,000,000. After appointment, the
successor Warrant Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Warrant Agent without
further act or deed; but the predecessor Warrant Agent shall deliver and
transfer to the successor Warrant Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or
deed necessary for the purpose. No later than the effective date of any such
appointment, the Company shall file notice thereof in writing with the
predecessor Warrant Agent and the transfer agent of the Common Units, and mail a
notice thereof in writing to the Holders of the Warrant Certificates. Failure to
give any notice provided for in this Section 19, however, or any defect therein,
shall not affect the legality or validity of the resignation or removal of the
Warrant Agent or the appointment of the successor Warrant Agent, as the case may
be.
SECTION 20. DEFINITIONS. In this Agreement, the following terms shall
have the meanings set forth below:
"AGREEMENT" (shall have the same meaning given it in the first
paragraph of this Agreement.)
13
"COMMON UNITS" shall mean the Common Units of the Company (as defined
in the Limited Liability Company Agreement), as constituted on the Effective
Date.
"COMPANY" (shall have the same meaning given it in the first paragraph
of this Agreement.)
"CURRENT MARKET PRICE" of a Common Unit on any date shall be deemed to
be the average of the daily closing prices per Common Unit for the 20
consecutive trading days immediately preceding such date, or if the Common Units
is then neither publicly traded on any established securities market nor quoted
in any recognized system, the value determined in good faith by the Board of
Directors of the Company in its discretion (which determination shall be
conclusive). The closing price for each day shall be the last sale price regular
way or, in case no such sale takes place on such day, the average of the closing
bid and asked prices regular way, on the principal national securities exchange
on which the Common Units are listed or admitted to trading or on the Nasdaq
National Market or SmallCap, or if the Common Units are not listed or admitted
to trading on any national securities exchange or on the Nasdaq National Market
or SmallCap, the average of the highest reported bid and lowest reported asked
prices as furnished by the NASD; provided, that if the NASD is not engaged at
the time in the business of furnishing such prices, as furnished by any similar
firm then engaged in such business, or if there is no such firm, as furnished by
any member of the NASD selected by the Company.
"EFFECTIVE DATE" shall mean March 1, 2003.
"ENTITY" shall mean any Person other than an individual or sole
proprietorship.
"EOTT ENERGY" (shall have the same meaning given it in the second
paragraph of this Agreement.)
"EXERCISE PRICE" shall mean at any date the price on such date pursuant
to this Agreement at which the Holder of a Warrant may purchase a Common Unit
upon exercise of the Warrant pursuant to this Agreement.
"EXPIRATION DATE" shall the fifth anniversary of the Effective Date.
"HOLDER" shall mean the Person in whose name a Warrant is registered in
the Warrant register of the Company maintained by or on behalf of the Company
for such purpose.
"INITIAL EXERCISE DATE" means June 30, 2003.
"LIMITED LIABILITY COMPANY AGREEMENT" shall mean the Amended and
Restated Limited Liability Company Agreement of the Company, as amended from
time to time.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"PERMITTED ISSUANCES" shall mean (i) the issuance of the Warrants, (ii)
the issuance of warrants, rights or options or grants to the Company's
management, directors or other employees, or consultants, for the purchase or
grant of Common Units pursuant to the Plan or any employee benefit or option
plan of the Company, and (iii) the issuance of Common Units upon exercise of the
warrants and options referred to in clauses (i) and (ii).
"PERSON" shall mean any individual, sole proprietorship, partnership,
limited liability company, joint venture, trust, incorporated organization,
association, corporation, institution, public benefit
14
corporation, entity or government (whether federal, state, county, city,
municipal or otherwise, including, without limitation, any instrumentality,
division, agency, body or department thereof).
"PLAN OR PLAN OF REORGANIZATION" shall have the meaning given it in the
second paragraph of this Agreement.
"WARRANT" means the warrants to purchase Common Units to be issued
pursuant to this Agreement.
"WARRANT AGENT" shall have the meaning given it in the first paragraph
of this Agreement.
"WARRANT CERTIFICATE" shall mean any certificate substantially in the
form attached as Exhibit A hereto representing a Warrant, and shall include all
Warrants issued upon transfer, split-up, combination or exchange of any thereof.
SECTION 21. NOTICE OF PROPOSED ACTIONS. In case the Company shall
propose (a) to pay any dividend or distribution payable in Common Units to the
holders of its Common Units or to make any other dividend or distribution to the
holders of its Common Units (other than Permitted Issuances, cash distributions
or cash distribution payable out of consolidated earnings or earned or capital
surplus, or (b) to offer to the holders of the Common Units rights, options or
warrants to subscribe for or to purchase any additional Common Units (or
securities convertible into Common Units), or (c) to effect any reclassification
of its Common Units (other than reclassification involving only the subdivision,
split up, reverse split, or combination of outstanding Common Units), or (d) to
effect any reorganization, consolidation, merger or sale, or lease of all or
substantially all of the property, assets or business of the Company, or (e) to
effect the liquidation, dissolution or winding up of the Company, then, in each
such case, the Company shall give to each Holder of a Warrant, in accordance
with Section 22 hereof, a notice of such proposed action, which shall specify
(i) the record date for the purposes of such Common Unit distribution or
distribution of rights or warrants, or (ii) the date on which such
reorganization, reclassification, split up, reverse split, consolidation,
merger, sale, lease, liquidation, dissolution, or winding up is to take place
and the date of participation therein by the holders of Common Units, if any
such date is to be fixed; and such notice shall be so given in the case of any
action covered by clause (a) or (b) above at least 20 days prior to the record
date for determining holders of the Common Units for purposes of such action,
and in the case of any action covered by clause (c), (d) or (e) above, at least
10 days prior to the date of the taking of such proposed action or the date of
participation therein by the holders of Common Units, whichever shall be the
earlier. At the Company's request, the Warrant Agent shall give such notice in
the Company's name and at its expense. The failure to give notice required by
this Section 21 or any defect therein shall not affect the legality or validity
of the action taken by the Company or the vote upon any such action.
SECTION 22. NOTICES. Notices or demands authorized by this Agreement to
be given or made by the Warrant Agent or by the Holder of any Warrant
Certificate to or on the Company shall be sufficiently given or made if sent by
first-class mail, postage prepaid, return receipt requested, addressed (until
another address is filed in writing with the Warrant Agent) as follows:
EOTT Energy LLC
▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Subject to the provisions of Section 19, any notice or demand authorized by this
Agreement to be given or made by the Company or by the Holder of any Warrant
Certificate to or on the Warrant Agent shall be
15
sufficiently given or made if sent by first-class mail, postage prepaid, return
receipt requested, addressed (until another address is filed in writing with the
Company) as follows:
EquiServe Trust Company N.A.
c/o EquiServe, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
Attn: General Counsel
Notices or demands authorized by this Agreement to be given or made by the
Company or the Warrant Agent to the Holder of any Warrant Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such Holder at the address of such Holder as shown on the Warrant
register of the Company maintained by the Warrant Agent pursuant to Section 3
hereof.
SECTION 23. SUPPLEMENTS AND AMENDMENTS. The Company and the Warrant
Agent may from time to time supplement or amend this Agreement without the
approval of any Holders of Warrant Certificates in order to cure any ambiguity,
to correct or supplement any provision contained herein which may be defective
or inconsistent with any provisions herein, or to make any other provisions in
regard to matters or questions arising hereunder which the Company and the
Warrant Agent may deem necessary or desirable and which shall not adversely
affect the interests of the Holders of Warrant Certificates.
The provisions of this Agreement may otherwise from time to time be
supplemented or amended by written agreement of the parties hereto and the
Holders of the outstanding Warrants, subject to the limitations provided in the
balance of this paragraph and elsewhere in this Agreement. The Holders of at
least a majority of the then outstanding Warrants, excluding Warrants held by
the Company, may, on behalf of all of the Holders of then outstanding Warrants,
act to amend or supplement this Agreement in any respect, which Agreement as so
amended or supplemented shall be binding on and shall inure to the benefit of
all Holders of the then outstanding Warrants, provided that no change in the
number or nature of the Common Units purchasable on exercise of a Warrant, or
the Exercise Price thereof, or the Expiration Date of any Warrant shall be made
without the consent in writing of each Holder of a Warrant to be so affected,
other than such changes as are permitted by this
Warrant Agreement as originally
executed. Upon execution and delivery of any amendment pursuant to this Section
23, such amendment shall be considered a part of this Agreement for all purposes
and every Holder of a Warrant Certificate theretofore or thereafter
countersigned and delivered hereunder shall be bound thereby.
The Company shall mail notice to each Holder of a Warrant, in
accordance with Section 22 hereof, of any amendment affecting the rights of the
Warrant Holders effected pursuant to this Section 23, within 60 days of any such
amendment.
SECTION 24. SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
SECTION 25. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall
be construed to give to any Person or Entity other than the Company, the Warrant
Agent and the Holders of the Warrant Certificates any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Company, the Warrant Agent and the Holders of the
Warrant Certificates.
16
SECTION 26. GOVERNING LAW. The laws of the State of
Delaware shall
govern this Agreement and each Warrant Certificate without regard to principles
of conflicts of law.
SECTION 27. COUNTERPARTS. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
an original, and all such counterparts shall together constitute but one and the
same instrument.
SECTION 28. INSPECTION. The Warrant Agent shall cause a copy of this
Agreement to be available at all reasonable times at the office of the Warrant
Agent for inspection by the Holder of any Warrant Certificate. The Warrant Agent
may require such Holder to submit his Warrant Certificate for inspection of the
Agreement by such Holder.
SECTION 29. DESCRIPTIVE HEADINGS. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
17
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
EOTT ENERGY LLC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇, President
Attest:
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Secretary
EQUISERVE, INC.
EQUISERVE TRUST COMPANY, N.A.
On Behalf of both Entities
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Director
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Attest:
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Accounting Manager
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Form of Warrant Certificate
No. ____ ______________ Warrants
NOT EXERCISABLE AFTER THE EXPIRATION DATE
THIS CERTIFIES THAT ___________________, or registered assigns, is the
registered owner of the number of Warrants set forth above, each of which
entitles the owner thereof to purchase at any time after June 30, 2003, and at
or prior to 5:00 p.m. (New York time) on the Expiration Date (hereinafter
defined) at the principal office of _______________________, (the "WARRANT
AGENT"), or at the Warrant Agent's facility designated for such purpose at
___________________________ or its successor as Warrant Agent, ___ fully and
non-assessable Common Unit(s) of
EOTT Energy LLC, a
Delaware limited liability
company (the "COMPANY"), at a cash purchase price (the "EXERCISE PRICE") equal
to $12.50 per Common Unit.
Valid exercise shall occur upon presentation and surrender of this
Warrant Certificate with the Election to Purchase duly executed and accompanied
by payment of the Exercise Price in the manner specified in the
Warrant
Agreement (hereinafter defined). The number of Warrants evidenced by this
Warrant Certificate (and the number of Common Units which may be purchased upon
exercise thereof) set forth above, and the Exercise Prices per Common Unit set
forth above, are the number and Exercise Prices as of ________ __, 2003 (the
"EFFECTIVE DATE"), based on the Common Units of the Company as constituted at
such date, unless this Warrant Certificate is being issued after the Effective
Date pursuant to any provision for such issuance contained in the
Warrant
Agreement, in which case such figures are based upon the Common Units of the
Company as constituted at the time of such issuance.
As provided in the
Warrant Agreement, the Exercise Price, the number of
Common Units which may be purchased upon the exercise of the Warrants evidenced
by this Warrant Certificate and the number of Warrants are, upon the happening
of certain events, subject to modification and adjustment.
The "EXPIRATION DATE" is defined in the Warrant Agreement as five years
from the Effective Date.
This Warrant Certificate is subject to all of the terms, provisions and
conditions of an agreement ("WARRANT AGREEMENT") between the Company and the
Warrant Agent, which Warrant Agreement is hereby incorporated herein by
reference and made a part hereof and to which Warrant Agreement reference is
hereby made for a full description of the rights, limitations of rights,
obligations, duties and immunities hereunder of the Warrant Agent, the Company
and the Holders of the Warrant Certificates. Copies of the Warrant Agreement are
on file at the above-mentioned principal office of the Warrant Agent. To the
extent of any inconsistency between this Warrant Certificate and the Warrant
Agreement, the terms and conditions of the Warrant Agreement shall govern.
This Warrant Certificate, with or without other Warrant Certificates,
upon surrender at the principal office of the Warrant Agent or at its facility
designated for such purpose at ____________ may be exchanged for another Warrant
Certificate or Warrant Certificates of like tenor and date evidencing Warrants
entitling the Holder to purchase a like aggregate number of Common Units as the
Warrants evidenced by the Warrant Certificate or Warrant Certificates
surrendered shall have entitled such Holder to purchase. If this Warrant
Certificate shall be exercised in part, the Holder shall be entitled to receive
upon surrender hereof, another Warrant Certificate or Warrant Certificates for
the number of whole Warrants not exercised.
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At the option of the Company, no fractional Common Units will be issued
upon the exercise of any Warrant or Warrants evidenced hereby nor will Warrants
to purchase fractional Common Units be issued, but in lieu thereof a cash
payment will be made, as provided in the Warrant Agreement.
No Holder of this Warrant Certificate shall be entitled to vote or
receive distributions or be deemed for any purpose the holder of Common Units or
of any other securities of the Company which may at any time be issuable on the
exercise hereof, nor shall anything contained in the Warrant Agreement or herein
be construed to confer upon the Holder hereof, as such, any of the rights of a
holder of the Common Units of the Company or any right to vote upon any matter
submitted to holders of the Common Units at any meeting thereof, or to give or
withhold consent to any Company action (whether upon any recapitalization,
issuance of Units, reclassification of Units, consolidation, merger, conveyance,
or otherwise) or, except as provided in the Warrant Agreement, to receive notice
of meetings, or to receive distributions or subscription rights or otherwise,
until the Warrant or Warrants evidenced by this Warrant Certificate shall have
been exercised as provided in the Warrant Agreement.
This Warrant Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Warrant Agent.
Dated: _____________
EOTT ENERGY LLC
By:
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Its:
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Attest:
By:
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Its:
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WARRANT AGENT:
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By:
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Its: Authorized Signature
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The undersigned hereby irrevocably elects to exercise Warrants
represented by this Warrant Certificate and to purchase the Common Units
issuable upon the exercise of said Warrants, and requests that Certificates for
such Common Units be issued and delivered as follows:
ISSUE TO:
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(Name)
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(Address, Including Zip Code)
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(Social Security or Tax ID Number)
DELIVER TO:
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(Name)
at
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(Address, Including Zip Code)
If the number of Warrants hereby exercised is less than all the
Warrants represented by this Warrant Certificate, the undersigned requests that
a new Warrant Certificate representing the number of full Warrants not exercised
be issued and delivered as set forth below.
DATED: ,
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Name of Warrant Holder or Assignee:
Address:
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In full payment of the purchase price with respect to the Warrants
exercised and transfer taxes, if any, the undersigned hereby tenders payment of
$___________ by certified check or official bank check or money order payable in
United States currency to the order of the Company.
Dated:
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Signature:
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(Signature must conform in all respects to
name of Holder as specified on the face of
the Warrant Certificate.)
PLEASE INSERT SECURITY OR TAX IDENTIFICATION
NUMBER OF HOLDER
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21
ASSIGNMENT
(To be signed only upon assignment of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
to _____________________________, ________ Warrant(s) represented by the within
Warrant Certificate and hereby irrevocably constitutes and appoints
______________________________________ Attorney to transfer said Warrant(s) on
the books of the Company, with full power of substitution in the premises.
DATED:
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Signature of Holder
Note: The above signature must correspond with the name as written on the
face of this Warrant Certificate in every particular, without alteration
or enlargement or any change whatever.
SIGNATURE(S) GUARANTEED:
By:
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THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR
INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT
UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM),
PURSUANT TO SEC RULE 17Ad-15
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