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Exhibit 4.4
THE WARRANT EVIDENCED OR CONSTITUTED HEREBY, AND ALL SHARES OF SERIES A
PREFERRED STOCK OR COMMON STOCK ISSUABLE HEREUNDER, HAVE BEEN AND WILL BE
ISSUED WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED
("THE ACT"). SUCH SECURITIES MAY NOT BE SOLD, OFFERED FOR SALE, TRANSFERRED,
PLEDGED OR HYPOTHECATED WITHOUT REGISTRATION UNDER THE ACT UNLESS EITHER (A)
THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL, IN FORM AND SUBSTANCE
REASONABLY SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT REGISTRATION IS
NOT REQUIRED IN CONNECTION WITH SUCH DISPOSITION OR (B) THE SALE OF SUCH
SECURITIES IS MADE PURSUANT TO SECURITIES AND EXCHANGE COMMISSION RULE 144.
WARRANT TO PURCHASE
SERIES A PREFERRED STOCK OF
INTEGRATED TELECOM EXPRESS, INC.
(Subject to Adjustment)
THIS CERTIFIES THAT, for value received, Intel Corporation, a
Delaware corporation, or its permitted registered assigns (the "HOLDER") is
entitled, subject to the terms and conditions of this Warrant, including the
vesting provisions described in Section 2.7, at any time after October 29,
1998 (the "EFFECTIVE DATE"), and before 5:00 p.m. Pacific Time on October 29,
2003 (the "EXPIRATION DATE"), to purchase from Integrated Telecom Express,
Inc., a California corporation (the "COMPANY"), seven hundred fourteen
thousand two hundred eighty-six (714,286) shares of Warrant Stock of the
Company at a price per share of three dollars and fifty cents ($3.50) (the
"PURCHASE PRICE"). Both the number of shares of Warrant Stock purchasable
upon exercise of this Warrant and the Purchase Price are subject to
adjustment and change as provided herein. This Warrant is issued pursuant to
that certain Series A Preferred Stock and Warrant Purchase Agreement, dated
October 27, 1998 (the "PURCHASE AGREEMENT"), between the Company and the
purchasers listed in Exhibit A thereto.
1. CERTAIN DEFINITIONS. As used in this Warrant, the following terms
shall have the following respective meanings:
"COMMON STOCK" shall mean the Company's Common Stock.
"FAIR MARKET VALUE" of a share of Warrant Stock as of a particular
date shall mean:
(a) If the Common Stock is traded on a securities
exchange or the Nasdaq National Market, the Fair Market Value shall be deemed
to be the product of: (i) the average of the closing prices of the Common
Stock of the Company on such exchange or market over the ten (10) business
days ending immediately prior to the applicable date of valuation and (ii)
the number of shares of Common Stock into which each of shares of Series A
Preferred is convertible at the time of such exercise;
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(b) If the Common Stock is actively traded
over-the-counter, the Fair Market Value shall be deemed to be the product of:
(i) the average of the closing bid and asked prices of the Common Stock over
the ten (10) trading-day period ending immediately prior to the applicable
date of valuation and (ii) the number of shares of Common Stock into which
each of shares of Series A Preferred is convertible at the time of such
exercise;
(c) If there is no active public market for the Common
Stock, the Fair Market Value shall be the value thereof, as agreed upon by
the Company and the Holder; PROVIDED, HOWEVER, that if the Company and the
Holder cannot agree on such value, such value shall be determined by an
independent valuation firm experienced in valuing businesses such as the
Company and jointly selected in good faith by the Company and the Holder.
Fees and expenses of the valuation firm shall be paid by the Company.
"HSR ACT" shall mean the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, and the rules and regulations promulgated thereunder.
"IPO" shall mean the Company's first firm commitment underwritten
public offering of the Common Stock pursuant to a registration statement
under the Securities Act of 1933, as amended, filed with the SEC.
"PERSON" shall mean any individual, corporation, partnership,
limited liability company, trust or other entity or organization, including
any governmental authority or political subdivision thereof.
"REGISTERED HOLDER" shall mean any Holder in whose name this Warrant
is registered upon the books and records maintained by the Company.
"SEC" shall mean the United States Securities and Exchange
Commission.
"SERIES A PREFERRED" shall mean the Series A Preferred Stock.
"WARRANT" shall mean this Warrant and any warrant delivered in
substitution or exchange therefor as provided herein.
"WARRANT STOCK" shall mean the Series A Preferred of the Company and
any other securities at any time receivable or issuable upon exercise of this
Warrant.
2. EXERCISE OF WARRANT.
2.1. PAYMENT. Subject to compliance with the terms and
conditions of this Warrant and applicable securities laws, this Warrant may
be exercised, in whole or in part at any time or from time to time, on or
before the Expiration Date by the delivery (including, without limitation,
delivery by facsimile) of the form of Notice of Exercise attached hereto as
EXHIBIT 1 (the "NOTICE OF EXERCISE") duly executed by the Holder, at the
principal office of the Company, surrendering:
(a) this Warrant at the principal office of the Company, and
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(b) payment, (i) in cash, by check or by wire transfer,
(ii) by cancellation by the Holder of any indebtedness of the Company to the
Holder or (iii) by any combination of (i) and (ii), of an amount equal to the
product obtained by multiplying the number of shares of Warrant Stock being
purchased upon such exercise by the then effective Purchase Price (the
"EXERCISE AMOUNT"), except that if the Holder is subject to HSR Act
Restrictions (as defined in Section 2.5 below), the Exercise Amount shall be
paid to the Company within five (5) business days after the termination of
all HSR Act Restrictions.
2.2. NET ISSUE EXERCISE. In lieu of the payment methods set
forth in Section 2.1(b) above, the Holder may elect to exchange all or some
of the Warrant for shares of Warrant Stock equal to the value of the amount
of the Warrant being exchanged on the date of exchange. If the Holder elects
to exchange this Warrant as provided in this Section 2.2, the Holder shall
tender to the Company the Warrant for the amount being exchanged, along with
written notice of the Holder's election to exchange some or all of the
Warrant, and the Company shall issue to the Holder the number of shares of
the Warrant Stock computed using the following formula:
X = Y (A-B)
-------
A
Where:
X = the number of shares of Warrant Stock to be issued to the
Holder;
Y = the number of shares of Warrant Stock purchasable under
the amount of the Warrant being exchanged (as adjusted to the
date of such calculation);
A = the Fair Market Value of one share of Warrant Stock; and
B = the Purchase Price (as adjusted to the date of such
calculation).
All references herein to an "exercise" of the Warrant shall
include an exchange pursuant to this Section 2.2. Upon receipt of a written
notice of the Company's intention to raise capital by selling shares of
Common Stock in an IPO (the "IPO NOTICE"), which notice shall be delivered to
the Holder at least thirty (30) days before the anticipated date of the
filing with the SEC, the Holder shall promptly notify the Company whether or
not the Holder will exercise this Warrant pursuant to this Section 2.2 prior
to consummation of the IPO. Notwithstanding whether or not an IPO Notice has
been delivered to the Holder or any other provision of this Warrant to the
contrary, if the Holder decides to exercise this Warrant while a registration
statement is on file with the SEC in connection with the IPO, this Warrant
shall be deemed exercised on the consummation of the IPO and the Fair Market
Value of a share of Warrant Stock will be the price at which one share of
Common Stock was sold to the public in the IPO. If the Holder has elected to
exercise this Warrant pursuant to this Section 2.2 while a registration
statement is on file with the SEC in connection with an IPO and the IPO is
not consummated, then the Holder's exercise of this Warrant shall not be
effective unless the Holder confirms in writing the Holder's intention to go
forward with the exercise of this Warrant.
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2.3. "EASY SALE" EXERCISE. In lieu of the payment methods set
forth in Section 2.1(b) above, when permitted by law and applicable
regulations (including Nasdaq and NASD rules), the Holder may pay the
Purchase Price through a "same day sale" commitment from the Holder (and if
applicable a broker-dealer that is a member of the National Association of
Securities Dealers (an "NASD Dealer")), whereby the Holder irrevocably elects
to exercise this Warrant and to convert the Warrant Shares receivable into
shares of Common Stock and to sell a portion of the shares of Common Stock so
purchased to pay for the Purchase Price and the Holder (or, if applicable,
the NASD Dealer) commits upon sale (or, in the case of the NASD Dealer, upon
receipt) of such shares to forward the Purchase Price directly to the Company.
2.4. STOCK CERTIFICATES; FRACTIONAL SHARES. As soon as
practicable on or after any date of exercise of this Warrant pursuant to this
Section 2, the Company shall issue and deliver to the Person or Persons
entitled to receive the same a certificate or certificates for the number of
whole shares of Warrant Stock issuable upon such exercise, together with cash
in lieu of any fraction of a share equal to such fraction of the current Fair
Market Value of one whole share of Common Stock as of the date of exercise of
this Warrant. No fractional shares or scrip representing fractional shares
shall be issued upon an exercise of this Warrant.
2.5. HSR ACT. The Company hereby acknowledges that exercise of
this Warrant by the Holder may subject the Company or the Holder to the
filing requirements of the HSR Act and that the Holder may be prevented from
exercising this Warrant until the expiration or early termination of all
waiting periods imposed by the HSR Act ("HSR ACT RESTRICTIONS"). If on or
before the Expiration Date the Holder has sent a Notice of Exercise to the
Company and the Holder has not been able to complete the exercise of this
Warrant prior to the Expiration Date because of HSR Act Restrictions, the
Holder shall be entitled to complete the process of exercising this Warrant
in accordance with the procedures contained herein within five (5) business
days following termination of the HSR Act Restrictions.
2.6. PARTIAL EXERCISE; EFFECTIVE DATE OF EXERCISE. In case of
any partial exercise of this Warrant, the Company shall cancel this Warrant
upon surrender hereof and shall execute and deliver a new Warrant of like
tenor and date for the balance of the shares of Warrant Stock purchasable
hereunder. The partial exercise of this Warrant shall be exercisable in units
of a minimum of 100,000 shares. This Warrant shall be deemed to have been
exercised immediately prior to the close of business on the date of its
surrender for exercise as provided above. However, if the Holder is subject
to HSR Act filing requirements, this Warrant shall be deemed to have been
exercised on the date immediately following the date of the expiration of all
HSR Act Restrictions. The Person entitled to receive the shares of Warrant
Stock issuable upon exercise of this Warrant shall be treated for all
purposes as the holder of record of such shares as of the close of business
on the date the Holder is deemed to have exercised this Warrant.
3. VALID ISSUANCE; TAXES. All shares of Warrant Stock issued upon the
exercise of this Warrant shall be validly issued, fully paid and
non-assessable, and the Company shall pay all taxes and other governmental
charges that may be imposed in respect of the issue or delivery thereof;
provided, however, that the Company shall not be required to pay any tax or
other charge imposed in connection with any transfer involved in the issuance
of any certificate for shares of Warrant Stock in any name other than that of
the Registered Holder of this Warrant,
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and in such case the Company shall not be required to issue or deliver any
stock certificate or security until such tax or other charge has been paid,
or it has been established to the Company's reasonable satisfaction that no
tax or other charge is due.
4. ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES. The number of
shares of Warrant Stock issuable upon exercise of this Warrant (or any shares
of stock or other securities or property receivable or issuable upon exercise
of this Warrant) and the Purchase Price are subject to adjustment upon
occurrence of any of the following events:
4.1. ADJUSTMENT FOR STOCK SPLITS, STOCK SUBDIVISIONS OR
COMBINATIONS OF SHARES. The Purchase Price shall be proportionally decreased
and the number of shares of Warrant Stock issuable upon exercise of this
Warrant (or any shares of stock or other securities at the time issuable upon
exercise of this Warrant) shall be proportionally increased to reflect any
stock split or subdivision of the Warrant Stock or Common Stock. The Purchase
Price of this Warrant shall be proportionally increased and the number of
shares of Warrant Stock issuable upon exercise of this Warrant (or any shares
of stock or other securities at the time issuable upon exercise of this
Warrant) shall be proportionally decreased to reflect any combination of the
Warrant Stock or Common Stock.
4.2. ADJUSTMENT FOR DIVIDENDS OR DISTRIBUTIONS OF STOCK OR OTHER
SECURITIES OR PROPERTY. If the Company shall make or issue, or shall fix a
record date for the determination of eligible holders entitled to receive, a
dividend or other distribution with respect to the Warrant Stock (or any
shares of stock or other securities at the time issuable upon exercise of the
Warrant) or Common Stock payable in (a) securities of the Company or (b)
assets (excluding cash dividends paid or payable solely out of retained
earnings), then, in each such case, the Holder of this Warrant on exercise
hereof at any time after the consummation, effective date or record date of
such dividend or other distribution, shall receive, in addition to the shares
of Warrant Stock (or such other stock or securities) issuable on such
exercise prior to such date, and without the payment of additional
consideration therefor, the securities or such other assets of the Company to
which such Holder would have been entitled upon such date if such Holder had
exercised this Warrant on the date hereof and had thereafter, during the
period from the date hereof to and including the date of such exercise,
retained such shares or all other additional stock available by it as
aforesaid during such period giving effect to all adjustments called for by
this Section 4.
4.3. RECLASSIFICATION. If the Company, by reclassification of
securities or otherwise, shall change any of the securities as to which
purchase rights under this Warrant exist into the same or a different number
of securities of any other class or classes, this Warrant shall thereafter
represent the right to acquire such number and kind of securities as would
have been issuable as the result of such change with respect to the
securities that were subject to the purchase rights under this Warrant
immediately prior to such reclassification or other change and the Purchase
Price therefor shall be appropriately adjusted, all subject to further
adjustment as provided in this Section 3. No adjustment shall be made
pursuant to this Section 3.3 upon any conversion or redemption of the Warrant
Stock which is the subject of Section 3.5.
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4.4. ADJUSTMENT FOR CAPITAL REORGANIZATION, MERGER OR
CONSOLIDATION. In case of any reorganization of the capital stock of the
Company (other than a combination, reclassification, exchange or subdivision
of shares otherwise provided for herein), or any merger or consolidation of
the Company with or into another Person, or the sale of all or substantially
all the assets of the Company then, and in each such case, as a part of such
reorganization, merger, consolidation, sale or transfer, lawful provision
shall be made so that the Holder of this Warrant shall thereafter be entitled
to receive upon exercise of this Warrant, during the period specified herein
and upon payment of the Purchase Price then in effect, the number of shares
of stock or other securities or property of the successor Person resulting
from such reorganization, merger, consolidation, sale or transfer that a
holder of the shares deliverable upon exercise of this Warrant (assuming
conversion of all Warrant Stock to Common Stock) would have been entitled to
receive in such reorganization, consolidation, merger, sale or transfer if
this Warrant (and the Warrant Stock receivable had been converted to Common
Stock) had been exercised immediately before such reorganization, merger,
consolidation, sale or transfer, all subject to further adjustment as
provided in this Section 3. The foregoing provisions of this Section 3.4
shall similarly apply to successive reorganizations, consolidations, mergers,
sales and transfers and to the stock or securities of any other Person that
are at the time receivable upon the exercise of this Warrant. If the
per-share consideration payable to the Holder hereof for shares in connection
with any such transaction is in a form other than cash or marketable
securities, then the value of such consideration shall be determined in good
faith by the Company's Board of Directors. In all events, appropriate
adjustment (as determined in good faith by the Company's Board of Directors)
shall be made in the application of the provisions of this Warrant with
respect to the rights and interests of the Holder after the transaction, to
the end that the provisions of this Warrant shall be applicable after that
event, as near as reasonably may be, in relation to any shares or other
property deliverable after that event upon exercise of this Warrant.
4.5. CONVERSION OF WARRANT STOCK. If all or any portion of the
authorized and outstanding shares of Warrant Stock are redeemed or converted
or reclassified into other securities or property pursuant to the Company's
Articles of Incorporation or otherwise, or the Warrant Stock otherwise ceases
to exist, then, in such case, the Holder of this Warrant, upon exercise
hereof at any time after the date on which the Warrant Stock is so redeemed
or converted, reclassified or ceases to exist (the "TERMINATION DATE"), shall
receive, in lieu of the number of shares of Warrant Stock that would have
been issuable upon such exercise immediately prior to the Termination Date,
the shares of Common Stock that would have been received if this Warrant had
been exercised in full and the Warrant Stock received thereupon had been
simultaneously converted immediately prior to the Termination Date, all
subject to further adjustment as provided in this Warrant. Additionally, the
Purchase Price shall be immediately adjusted to equal the quotient obtained
by dividing (a) the aggregate Purchase Price of the maximum number of shares
of Warrant Stock for which this Warrant was exercisable immediately prior to
the Termination Date by (b) the number of shares of Common Stock for which
this Warrant is exercisable immediately after the Termination Date, all
subject to further adjustment as provided herein.
5. CERTIFICATE AS TO ADJUSTMENTS. In each case of any adjustment in the
Purchase Price, or number or type of shares issuable upon exercise of this
Warrant, the Chief Financial Officer or Controller of the Company shall
compute such adjustment in accordance
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with the terms of this Warrant and prepare a certificate setting forth such
adjustment and showing in detail the facts upon which such adjustment is
based, including a statement of the adjusted Purchase Price. The Company
shall promptly send (by facsimile and by either first class mail, postage
prepaid or overnight delivery) a copy of each such certificate to the Holder.
6. LOSS OR MUTILATION. Upon receipt of evidence reasonably satisfactory
to the Company of the ownership of and the loss, theft, destruction or
mutilation of this Warrant, and of indemnity reasonably satisfactory to it,
and (in the case of mutilation) upon surrender and cancellation of this
Warrant, the Company shall execute and deliver in lieu thereof a new Warrant
of like tenor as the lost, stolen, destroyed or mutilated Warrant.
7. RESERVATION OF WARRANT STOCK. The Company hereby covenants that at
all times there shall be reserved for issuance and delivery upon exercise of
this Warrant such number of shares of Warrant Stock, Common Stock or other
shares of capital stock of the Company as are from time to time issuable upon
exercise of this Warrant, and, from time to time, will take all steps
necessary to amend its Articles of Incorporation to provide sufficient
reserves of shares of Warrant Stock issuable upon exercise of this Warrant
and Common Stock issuable upon conversion of the Warrant Stock. All such
shares shall be duly authorized, and when issued upon such exercise, shall be
validly issued, fully paid and non-assessable, free and clear of all liens,
security interests, charges and other encumbrances or restrictions on sale
and free and clear of all preemptive rights, except encumbrances or
restrictions arising under federal or state securities laws. Issuance of this
Warrant shall constitute full authority to the Company's officers who are
charged with the duty of executing stock certificates to execute and issue
the necessary certificates for shares of Warrant Stock upon the exercise of
this Warrant and for shares of Common Stock upon conversion of Warrant Stock.
8. TRANSFER AND EXCHANGE. Subject to the terms and conditions of this
Warrant and compliance with all applicable securities laws, this Warrant and
all rights hereunder may be transferred, to any individual, corporation,
partnership, trust, unincorporated organization or any other entity or
organization not in direct competition with the Company, in whole or in part,
on the books of the Company maintained for such purpose at the principal
office of the Company referred to above, by the Registered Holder hereof in
person, or by duly authorized attorney, upon surrender of this Warrant
properly endorsed and upon payment of any necessary transfer tax or other
governmental charge imposed upon such transfer. Whether or not a proposed
transferee is a direct competitor of the Company will be determined in good
faith by the Board of Directors. Upon any permitted partial transfer, the
Company will issue and deliver to the Registered Holder a new Warrant or
Warrants with respect to the shares of Warrant Stock not so transferred. Each
taker and holder of this Warrant, by taking or holding the same, consents and
agrees that when this Warrant shall have been so endorsed, the Person in
possession of this Warrant may be treated by the Company, and all other
Persons dealing with this Warrant, as the absolute owner hereof for any
purpose and as the Person entitled to exercise the rights represented hereby,
any notice to the contrary notwithstanding; PROVIDED, HOWEVER, that until a
transfer of this Warrant is duly registered on the books of the Company, the
Company may treat the Registered Holder hereof as the owner for all purposes.
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9. RESTRICTIONS ON TRANSFER. The Holder, by acceptance hereof, agrees
that, absent an effective registration statement filed with the SEC under the
Securities Act of 1933, as amended (the "1933 ACT"), covering the disposition
or sale of this Warrant or the Warrant Stock issued or issuable upon exercise
hereof or the Common Stock issuable upon conversion of Warrant Stock, as the
case may be, and registration or qualification under applicable state
securities laws, such Holder will not sell, transfer, pledge, or hypothecate
any or all such Warrants, Warrant Stock, or Common Stock, as the case may be,
unless either (a) the Company has received an opinion of counsel, in form and
substance reasonably satisfactory to the Company, to the effect that such
registration is not required in connection with such disposition or (b) the
sale of such securities is made pursuant to SEC Rule 144.
10. COMPLIANCE WITH SECURITIES LAWS. By acceptance of this Warrant, the
Holder hereby represents, warrants and covenants: (a) that any shares of
stock purchased upon exercise of this Warrant shall be acquired for
investment only and not with a view to, or for sale in connection with, any
distribution thereof; (b) that the Holder has had such opportunity as such
Holder has deemed adequate to obtain from representatives of the Company such
information as is necessary to permit the Holder to evaluate the merits and
risks of its investment in the Company; (c) that the Holder is able to bear
the economic risk of holding such shares as may be acquired pursuant to the
exercise of this Warrant for an indefinite period; (d) that the Holder has
such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risks of the purchase of this Warrant
and the shares purchasable pursuant to the terms of this Warrant and of
protecting its interests in connection therewith; (e) that the Holder is an
accredited investor within the meaning of Rule 501 of Regulation D,
promulgated under the 1933 Act, as presently in effect; (f) that the Holder
understands that the shares of stock acquired pursuant to the exercise of
this Warrant will not be registered under the 1933 Act (unless otherwise
required pursuant to exercise by the Holder of the registration rights, if
any, previously granted to the Registered Holder) and will be "restricted
securities" within the meaning of SEC Rule 144 and that the exemption from
registration under Rule 144 will not be available for at least one year from
the date of exercise of this Warrant, subject to any special treatment by the
SEC for exercise of this Warrant pursuant to Section 2.2, and even then will
not be available unless a public market then exists for the stock, adequate
information concerning the Company is then available to the public, and other
terms and conditions of Rule 144 are complied with; and (g) that all stock
certificates representing shares of stock issued to the Holder upon exercise
of this Warrant or upon conversion of such shares may have affixed thereto a
legend substantially in the following form:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE SECURITIES
LAWS OF ANY STATE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON
TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT
AS PERMITTED UNDER THE ACT AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE
AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS
INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE
SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR
RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE
SECURITIES LAWS.
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11. NO RIGHTS OR LIABILITIES AS SHAREHOLDERS. This Warrant shall not
entitle the Holder to any voting rights or other rights as a shareholder of
the Company. In the absence of affirmative action by such Holder to purchase
Warrant Stock by exercise of this Warrant or Common Stock upon conversion
thereof, no provisions of this Warrant, and no enumeration herein of the
rights or privileges of the Holder hereof shall cause such Holder hereof to
be a shareholder of the Company for any purpose.
12. REGISTRATION RIGHTS. All shares of Common Stock issuable upon
conversion of the shares of Warrant Stock issuable upon exercise of this
Warrant shall be "Registrable Securities" or such other definition of
securities entitled to registration rights pursuant to the Shareholders'
Agreement, dated as of the date hereof, between the Company and the investors
listed on Schedule A thereto, and are entitled, subject to the terms and
conditions of that agreement, to all registration rights granted to holders
of Registrable Securities thereunder.
13. NOTICES. All notices and other communications from the Company to
the Holder shall be given in accordance with the Purchase Agreement.
14. HEADINGS. The headings in this Warrant are for purposes of
convenience in reference only, and shall not be deemed to constitute a part
hereof.
15. LAW GOVERNING. This Warrant shall be construed and enforced in
accordance with, and governed by, the laws of the State of California.
16. NO IMPAIRMENT. The Company will not, by amendment of its Articles of
Incorporation or Bylaws, or through reorganization, consolidation, merger,
dissolution, issue or sale of securities, sale of assets or any other
voluntary action, avoid or seek to avoid the observance or performance of any
of the terms of this Warrant, but will at all times in good faith assist in
the carrying out of all such terms and in the taking of all such action as
may be necessary or appropriate in order to protect the rights of the
Registered Holder of this Warrant against impairment. Without limiting the
generality of the foregoing, the Company: (a) will not increase the par value
of any shares of stock issuable upon the exercise of this Warrant above the
amount payable therefor upon such exercise and (b) will take all such action
as may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and non-assessable shares of Warrant Stock upon
exercise of this Warrant.
17. NOTICES OF RECORD DATE. In case:
17.1. the Company shall take a record of the holders of its
Warrant Stock, Common Stock (or other stock or securities at the time
receivable upon the exercise of this Warrant or conversion of Warrant Stock),
for the purpose of entitling them to receive any dividend or other
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distribution, or any right to subscribe for or purchase any shares of stock
of any class or any other securities or to receive any other right; or
17.2. of any consolidation or merger of the Company with or into
another Person, any capital reorganization of the Company, any
reclassification of the capital stock of the Company, or any conveyance of
all or substantially all of the assets of the Company to another Person in
which holders of the Company's stock are to receive stock, securities or
property of another Person; or
17.3. of any voluntary dissolution, liquidation or winding-up of
the Company; or
17.4. of any redemption or conversion of all outstanding Common
Stock or Warrant Stock;
then, and in each such case, the Company will mail or cause to be mailed to
the Registered Holder of this Warrant a notice specifying, as the case may
be, (a) the date on which a record is to be taken for the purpose of such
dividend, distribution or right or (b) the date on which such reorganization,
reclassification, consolidation, merger, conveyance, dissolution,
liquidation, winding-up, redemption or conversion is to take place, and the
time, if any is to be fixed, as of which the holders of record of Warrant
Stock, Common Stock (or other stock or securities as at the time are
receivable upon the exercise of this Warrant or conversion of the Warrant
Stock), shall be entitled to exchange their shares of Warrant Stock, Common
Stock (or such other stock or securities), for securities or other property
deliverable upon such reorganization, reclassification, consolidation,
merger, conveyance, dissolution, liquidation or winding-up. Such notice shall
be delivered at least thirty (30) days prior to the date therein specified.
18. SEVERABILITY. If any term, provision, covenant or restriction of
this Warrant is held by a court of competent jurisdiction to be invalid, void
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Warrant shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
19. COUNTERPARTS. For the convenience of the parties, any number of
counterparts of this Warrant may be executed by the parties hereto and each
such executed counterpart shall be, and shall be deemed to be, an original
instrument.
20. SUCCESSORS OR ASSIGNS. The terms of this Warrant shall be binding
upon and shall inure to the benefit of any successors or assigns of the
Company and of the holder or holders hereof and of the Warrant Stock issued
or issuable upon the exercise hereof.
21. ENTIRE AGREEMENT. This Warrant and the other documents delivered
pursuant hereto constitute the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof.
22. NO INCONSISTENT AGREEMENTS. The Company will not on or after the
date of this Warrant enter into any agreement with respect to its securities
which is inconsistent with the rights granted to the Holder of this Warrant
or otherwise conflicts with the provisions hereof. The rights granted to the
Holder hereunder do not in any way conflict with and are not
10
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inconsistent with the rights granted to holders of the Company's securities
under any other agreements, except rights that have been waived.
23. SATURDAYS, SUNDAYS AND HOLIDAYS. If the Expiration Date falls on a
Saturday, Sunday or legal holiday, the Expiration Date shall automatically be
extended until 5:00 p.m. the next business day.
24. ACCEPTANCE OF THE TERMS AND CONDITIONS. Receipt of this Warrant by
the Holder hereof shall constitute acceptance of and agreement to the
foregoing terms and conditions.
[The remainder of this page is intentionally left blank.]
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IN WITNESS WHEREOF, the parties hereto have executed this Warrant as of
the Effective Date.
INTEL CORPORATION INTEGRATED TELECOM EXPRESS, INC.
By: /s/ Arvind Sodhani By: /s/ Young Liu
------------------------------ --------------------------------
Arvind Sodhani Young Liu
--------------------------------- -----------------------------------
Name Name
Vice President and Treasurer President & CEO
--------------------------------- -----------------------------------
Title Title
(SIGNATURE PAGE TO THE WARRANT
OF
INTEGRATED TELECOM EXPRESS, INC.)
12
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EXHIBIT 1
NOTICE OF EXERCISE
(To be executed upon exercise of Warrant)
INTEGRATED TELECOM EXPRESS, INC. WARRANT NO. ___
The undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant Certificate for, and to purchase thereunder,
the securities of INTEGRATED TELECOM EXPRESS, INC., as provided for therein, and
(check the applicable box):
/ / Tenders herewith payment of the exercise price in full in the form of
cash or a certified or official bank check in same-day funds in the
amount of $____________ for _________ such securities.
/ / Elects the Net Issue Exercise option pursuant to Section 2.2 of the
Warrant, and accordingly requests delivery of a net of ______________
of such securities, according to the following calculation:
X = Y (A-B) ( ) = (____) [(_____) - (_____)]
------- ---------------------------
A (_____)
Where:
X = the number of shares of Warrant Stock to be issued to the
Holder;
Y = the number of shares of Warrant Stock purchasable under
the amount of the Warrant being exchanged (as adjusted to the
date of such calculation);
A = the Fair Market Value of one share of Warrant Stock; and
B = the Purchase Price (as adjusted to the date of such
calculation).
/ / Elects the Easy Sale Exercise option pursuant to Section 2.3 of the
Warrant, and accordingly requests delivery of a net of ______________
of such securities.
Please issue a certificate or certificates for such securities in the name of,
and pay any cash for any fractional share to (please print name, address and
social security number):
Name:
---------------- ---------------------------------------
Address:
---------------- ---------------------------------------
Signature:
---------------- ---------------------------------------
Note: The above signature should correspond exactly with the name on the first
page of this Warrant Certificate or with the name of the assignee appearing in
the assignment form below.
If said number of shares shall not be all the shares purchasable under the
within Warrant Certificate, a new Warrant Certificate is to be issued in the
name of said undersigned for the balance remaining of the shares purchasable
thereunder rounded up to the next higher whole number of shares.
