EXHIBIT 10.72
THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR
OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT
OR PURSUANT TO RULE 144 OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
CORPORATION AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
WARRANT TO PURCHASE STOCK
Company: National Manufacturing Technologies, Inc., a California corporation
Number of Shares: 200,000
Class of Stock: Common
Initial Exercise Price: $1.43
Issue Date: July 6, 2000
Expiration Date: Later of June 18, 2001 or the Outside Date (subject to
Article 4.1)
THIS CERTIFIES THAT, for value received, as consideration for an extension
of credit to National Manufacturing Technologies, Inc. (the "Company") and for
other good and valuable consideration, Celtic Capital Corporation or its
registered assign(s) ("Holder"), is entitled, subject to the terms and
conditions of this Warrant, at any time or from time to time after July 6, 2000
(the "Effective Date"), and before the later of (i) 5:00 p.m. Pacific Time on
June 18, 2001, or (ii) on the date (the "Outside Date") that is one year after
the date on which the Company's Registration Statement (as defined in the Loan
Agreement) covering the securities to be issued upon the exercise of this
Warrant is declared effective by the Securities and Exchange Commission (the
"Expiration Date"), to purchase from the Company the number of fully-paid and
non-assessable shares of the class of securities of the Company (the "Shares")
described above at the above-described initial exercise price per Share (the
"Warrant Price"). Notwithstanding the foregoing, for the purposes of the
preceding sentence and for the purposes of determining the Expiration Date, a
Registration Statement shall not be deemed to be effective if such Registration
Statement does not remain effective for a period of no less than two hundred and
seventy days after it is first declared effective or the Company fails to
satisfy any of its other obligations under Section 22 of the Loan Agreement
(defined below). Both the number of Shares that may be purchased upon exercise
of this Warrant and the Warrant Price are subject to adjustment and change as
provided herein. This Warrant is issued under that certain Loan and Security
Agreement, dated June 18, 1999, and last amended on August 14, 2000 (the "Loan
Agreement"), between the Company and Holder. Capitalized terms used in this
Warrant and not defined herein have the meanings given to them under the Loan
Agreement.
ARTICLE 1. EXERCISE
1.1 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 Appendix 1 (the "Notice of
Exercise"), duly executed by the Holder, at the principal office of the Company,
and as soon as practicable after such date, surrendering
(a) this Warrant at the principal office of the Company, and
(b) payment, (i) in cash (by check) or by wire transfer, (ii) by
cancellation by the Holder of 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 Common Stock being purchased
upon such exercise by the then effective Warrant Price (the "Exercise Amount").
1.2 Net Issue Exercise. In lieu of the payment methods set forth in
Section 1.1(b) above, the Holder may elect to exchange all or some of the
Warrant for shares of Common Stock equal to the value of the amount of the
Warrant being exchanged on the date of exchange. If Holder elects to exchange
this Warrant as provided in this Section 1.2, Holder shall tender to the Company
the Warrant for the amount being exchanged, along with written notice of
Holder's election to exchange some or all of the Warrant, and the Company shall
issue to Holder the number of shares of the Common Stock computed using the
following formula:
X = Y (A-B)
--------
A
Where X = the number of shares of Common Stock to be issued to Holder.
Y = the number of shares of Common Stock that Holder may purchase under the
amount of the Warrant being exchanged (as adjusted to the date of such
calculation).
A = the Fair Market Value (defined below) of one share of the Company's Common
Stock.
B = the Warrant Price (as adjusted to the date of such calculation).
All references herein to an "exercise" of the Warrant shall include an
exchange under this Section 1.2. Upon receipt of a written notice (the "Public
Offering Notice") of the Company's intention to raise capital by selling shares
of Common Stock in a secondary public offering (the "Public Offering"), which
notice shall be delivered to Holder at least forty-five (45) but not more than
ninety (90) days before the anticipated date of the filing with the Securities
and Exchange Commission (the "SEC") of the registration statement associated
with the Public Offering, Holder shall notify the Company whether or not Holder
will exercise this Warrant under this Section 1.2 before consummation of the
Public Offering. Notwithstanding whether or not an Public Offering Notice has
been delivered to Holder or any other provision of this Warrant to the contrary,
if Holder decides to exercise this Warrant while a registration statement is on
file with the SEC in connection with the Public Offering, this Warrant shall be
deemed exercised on the consummation of the Public Offering and the Fair Market
Value of a share of Common Stock will be the price at which one share of Common
Stock was sold to the public in the Public Offering. If Holder has elected to
exercise this Warrant under Section 1.2 while a registration statement is on
file with the SEC in connection with a Public Offering and the Public Offering
is not consummated, then Holder's exercise of this Warrant shall not be
effective unless Holder confirms in writing Holder's intention to go forward
with the exercise of this Warrant. Holder will not be entitled to exercise its
rights under this Section 1.2 if (A) the Fair Market Value of one share of the
Company's Common Stock is equal to or less than (B) the Warrant Price (as
adjusted to the date of such calculation), for the purpose of determining (X)
the number of shares of Common Stock to be issued to the Holder (based on the
above-described computation).
1.3 "Easy Sale" Exercise. In lieu of the payment methods set forth in
Section 1.1(b) above, when permitted by law and applicable regulations
(including Nasdaq and NASD rules), the Holder may pay the Exercise Amount
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
(a "NASD Dealer")), whereby the Holder irrevocably elects to exercise this
Warrant and to sell at least that number of Shares so purchased to pay the
Exercise Amount (and up to all of the Shares so purchased) 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 Exercise Amount directly to
the Company, with all sale proceeds (if any) in excess of the Exercise Amount
being for the benefit of the Holder. The total number of Shares with respect to
which Holder may exercise the rights set forth in this Section 1.3 on any given
trading day may not exceed the greater of the following: (i) the average trading
volume for the ten (10) trading days before the date on which the Holder
exercises its rights under this Section 1.3; or (ii) 40,000 Shares.
1.4 Delivery of Certificate and New Warrant. Promptly after Holder
exercises or converts this Warrant, the Company shall deliver to Holder
certificates for the Shares acquired and, if this Warrant has not been fully
exercised or converted and has not expired, a new Warrant representing the
Shares not so required.
1.5 Replacement of Warrants. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and, in the case of loss, theft or destruction, on delivery of an
indemnity agreement reasonably satisfactory in form and amount to the Company
or, in the case of mutilation, or surrender and cancellation of this Warrant,
the Company at its expense shall execute and deliver, in lieu of this Warrant, a
new warrant of like tenor.
<PAGE>
1.6 Repurchase on Sale, Merger, or Consolidation of the Company.
1.6.1. "Acquisition". For the purpose of this Warrant, "Acquisition"
means any sale, license, or other disposition of all or substantially all of the
assets (including intellectual property) of the company, or any reorganization,
consolidation, or merger of the Company where the holders of the Company's
securities before the transaction beneficially own less than 50% of the
outstanding voting securities of the surviving entity after the transaction.
1.6.2. Assumption of Warrant. If upon the closing of any
Acquisition the successor entity assumes the obligations of this Warrant, then
this Warrant shall be exercisable for the same securities, cash, and property as
would be payable for the Shares issuable upon exercise of the unexercised
portion of this Warrant as if such Shares were outstanding on the record date
for the Acquisition and subsequent closing. The Warrant Price shall be adjusted
accordingly.
1.6.3 Non-assumption. If upon the closing of any Acquisition the
successor entity does not assume the obligations of his Warrant and Holder has
not otherwise exercised this Warrant in full, then the unexercised portion of
this Warrant shall be deemed to have been automatically converted pursuant to
Section 1.2 and thereafter Holder shall participate in the acquisition on the
same terms as other holders of the same class of securities of the Company.
1.7 Fair Market Value. For the purposes of this Agreement, "Fair
Market Value" of a share of Common Stock as of a particular date means: (i) if
traded on a securities exchange or the Nasdaq National Market, the Fair Market
Value shall be deemed to be the average of the closing prices of the Common
Stock of the Company on such exchange or market over the five (5) business days
ending immediately before the applicable date of valuation; (ii) if actively
traded over-the-counter, the Fair Market Value shall be deemed to be the average
of the closing bid prices over the thirty (30) day period ending immediately
before the applicable date of valuation; and (iii) if there is no active public
market, the Fair Market Value shall be the value as determined in good faith by
the Company's Board of Directors upon a review of relevant factors.
ARTICLE 2. ADJUSTMENTS TO THE SHARES. The number of Shares issuable upon
exercise of this Warrant (or any share of stock or other security or property
receivable or issuable upon exercise of this Warrant) and the Warrant Price are
subject to adjustment upon occurrence of the following events:
2.1 Adjustment for Stock Splits, Stock Subdivisions or Combinations of
Shares. The Warrant Price of this Warrant shall be decreased proportionally and
the number of Shares issuable upon exercise of this Warrant (or any share of
stock or other securities at the time issuable upon exercise of this Warrant)
shall be increased proportionally to reflect any stock split or subdivision of
the Company's Common Stock. The Warrant Price of this Warrant shall be
increased proportionally and the number of Shares issuable upon exercise of this
Warrant (or any share of stock or other security at the time issuable upon
exercise of this Warrant) shall be decreased proportionally to reflect any
combination of the Company's Common Stock.
2.2 Adjustment for Dividends or Distributions of Stock or Other
Securities or Property. In case 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 Common Stock (or any share of
stock or other security at the time issuable upon exercise of the Warrant)
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 (or such other stock or securities) issuable
on such exercise before 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 on 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 and/or all other additional stock available by it as aforesaid during
such period giving effect to all adjustments called for by this Section 2.
2.3 Reclassification, Exchange or Substitution. Upon any
reclassification, exchange, substitution, or other event that results in a
change of the number and/or class of the securities issuable upon exercise or
conversion of this Warrant, the number and kind of securities and property that
Holder would have received for the Shares if this Warrant had been exercised
immediately before such reclassification, exchange, substitution, or other
event. The Company or its successor shall promptly issue to Holder a new Warrant
for such new securities or other property. The new Warrant shall provide for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article 2 including, without limitation,
adjustments to the Warrant Price and to the number of securities or property
issuable upon exercise of the new Warrant. The provisions of this Section 2.2
shall similarly apply to successive reclassifications, exchanges, substitutions,
or other events.
2.4 Adjustment for Capital Reorganization, Merger or Consolidation.
Except as provided in Section 1.6 of this Warrant (in the case of an
Acquisition), in case of any capital 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 corporation, 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 thereafter shall be entitled to
receive upon exercise of this Warrant, during the period specified herein and
upon payment of the Warrant Price then in effect, the number of shares of stock
or other securities or property of the successor corporation resulting from such
reorganization, merger, consolidation, sale or transfer that a holder of the
shares deliverable upon exercise of this Warrant would have been entitled to
receive in such reorganization, consolidation, merger, sale or transfer if this
Warrant had been exercised immediately before such reorganization, merger,
consolidation, sale or transfer, all subject to further adjustment as provided
in this Article 2. The foregoing provisions of this Section 2.4 similarly shall
apply to successive reorganizations, consolidations, mergers, sales and
transfers and to the stock or securities of any other corporation that are at
the time receivable upon the exercise of this Warrant; provided, however, the
provisions of this Section 2.4 shall not apply to any transaction contemplated
by Section 1.6 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 share or
other property deliverable after that event upon exercise of this Warrant.
2.5 No Impairment. The Company shall not, by amendment of its
Articles of Incorporation or through a reorganization, transfer of assets,
consolidation, merger, dissolution, issue, or sale of securities or any other
voluntary action, avoid or seek to avoid the observance or performance of any of
the terms to be observed or performed under this Warrant by the Company, but
shall at all times in good faith assist in carrying out all the provisions of
this Article 2 and in taking all such action as may be necessary or appropriate
to protect Holder's right under this Article against impairment. If the Company
takes any action affecting the Shares other than as described above that
adversely affects Holder's rights under this warrant, the Warrant Price shall be
adjusted downward and the number of Shares issuable upon exercise of this
Warrant shall be adjusted upward in such a manner that the aggregate Warrant
Price of this Warrant is unchanged.
2.6 Certificate as to Adjustments. Upon each adjustment of the
Warrant Price, the Company at its expense shall promptly compute such
adjustment, and furnish Holder with a certificate of its Chief Accounting
Officer setting forth such adjustment and the facts upon which such adjustment
is based. The Company shall, upon written request, furnish Holder a certificate
setting forth the Warrant Price in effect upon the date thereof and the series
of adjustments leading to such Warrant Price.
2.7 Ability to Adjust. The grant of this Warrant shall not affect in
any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to merge, consolidate, dissolve, liquidate, sell or transfer all or
any part of its business or assets.
ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.
3.1 Representations and Warranties. The Company hereby represents and
warrants to the Holder as follows:
(a) The Company is authorized to issue 30,000,000 shares of common
stock to which 10,540,035 shares are currently outstanding. There are no other
shares of stock of the Company issued and outstanding. Each share of common
stock entitles the holder thereof to one vote on all matters submitted to vote
of the shareholders, except that the holders have cumulative voting rights for
the election of directors. The holders of common stock do not have preemptive
rights or rights to convert their common stock into other securities. Holders
of common stock are entitled to receive ratably such dividends as may be
declared by the Board of Directors out of funds legally available therefor. In
the event of a liquidation, dissolution or winding up of the Company, holders of
the common stock have the right to ratable portion of the assets remaining after
payment of liabilities. The Company is authorized to issue 3,173,000 shares of
preferred stock. There is no issued and outstanding preferred stock. None of
the Company's outstanding shares have been issued in violation of any
preemptive right or agreement, commitment or obligation binding on the Company
or any of the Company's shareholders or any applicable securities laws.
(b) The Board of Directors of the Company approved and ratified
the issuance of this Warrant to the Holder on August 10, 2000
(c) The initial Warrant Price referenced on the first page of this
Warrant is not greater than (i) the price per share at which the Shares were
last issued in an arms-length transaction in which at least $50,000 of the
Shares were sold and (ii) the Fair Market Value of the Shares as of the date of
this Warrant.
(d) All Shares which may be issued upon the exercise of this
Warrant, and all securities, if any, issuable upon conversion or exchange of the
Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and
non-assessable, and free of liens and encumbrances except for restrictions on
transfer provided for herein or under applicable federal and state securities
laws.
(e) The Company has 312,500 Warrants to purchase stock outstanding
as August 10, 2000 which are more fully described in the attached Exhibit A.
3.2 Notice of Certain Events. If the Company proposes at any time (a)
to declare any dividend or distribution upon its common stock, whether in cash,
property, stock, or other securities and whether or not a regular cash dividend;
(b) to offer for subscription pro rata to the holders of any class or series of
its stock any additional shares of stock of any class or series or other rights;
(c) to effect any reclassification or recapitalization of common stock; (d) to
merge or consolidate with or into any other corporation, or sell, lease,
license, or convey all or substantially all of its assets, or to liquidate,
dissolve or wind up; or (e) offer holders of registration rights the opportunity
to participate in an underwritten public offering of the company's securities
for cash, then, in connection with each such event, the Company shall give
Holder (a) at least 20 business days prior written notice of the date on which a
record will be taken for such dividend, distribution, or subscription rights
(and specifying the date on which the holders of common stock will be entitled
thereto) or for determining rights to vote, if any, in respect of the matters
referred to in (c) and (d) above; (2) in the case of the matters referred to in
(c) and (d) above at least 20 business days prior written notice of the date
when the same will take place (and specifying the date on which the holders of
common stock will be entitled to exchange their common stock for securities or
other property deliverable upon the occurrence of such event); and (3) in the
case of the matter referred to in (e) above, the same notice as is given to the
holders of such registration rights.
3.3 Information Rights. So long as the Holder holds this Warrant
and/or any of the Shares, the Company shall deliver to the Holder (a) within
ninety (90) days after the end of each fiscal year of the Company, the annual
audited financial statements of the Company certified by independent public
accountants of recognized standing and (c) within forty-five (45) days after the
end of each of the first three quarters of each fiscal year, the Company 's
quarterly, unaudited financial statements.
3.4 Registration Under Securities Act of 1933, as amended. All Shares
(and other securities, if any) issuable upon the exercise of this Warrant are
securities entitled to registration rights under the Loan Agreement and are
entitled to, subject to the terms and conditions of that agreement, all
registration rights granted thereunder.
3.5 Reservation of Common 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 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 issuable upon exercise of
this Warrant (and other securities for issuance on conversion or exchange of
such Shares, if applicable). 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
Common Stock and Common Stock upon the exercise of this Warrant.
3.6 Taxes. The Company shall pay all taxes and other governmental
charges that may be imposed in respect of the issue or delivery of securities to
be issued upon exercise of this Warrant.
ARTICLE 4. MISCELLANEOUS.
4.1 Term. This Warrant is exercisable, in whole or in part, at any
time and from time to time on or before the Expiration Date set forth above.
4.2 Legends. This Warrant and the Shares shall be imprinted with a
legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMEMDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT AN
EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR PURSUANT TO RULE 144 OR AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION AND ITS COUNSEL
THAT SUCH REGISTRATION IS NOT REQUIRED.
4.3 Compliance with Securities Laws on Transfer. This Warrant and
the Shares issuable upon exercisable this Warrant may not be transferred or
assigned in whole or in part without compliance with applicable federal and
state securities laws by the transferor and the transferee (including, without
limitation, the delivery of investment representation letters and legal opinions
reasonably satisfactory to the Company). The Company shall not require Holder to
provide an opinion of counsel if the transfer is to an affiliate of Holder or if
there is no material question as to the availability of current information as
referenced in Rule 144(c), Holder represents that it has complied with Rule
144(d) and (e) in reasonable detail, the selling broker represents that it has
complied with Rule 144(f), and the Company is provided with a copy of Holder's
notice of proposed sale.
4.4 Transfer Procedure. Subject to the provisions of Section 4.2,
Holder may transfer all or part of this Warrant or the Shares issuable upon
exercise of this Warrant by giving the Company notice of the portion of the
Warrant being transferred setting forth the name, address and taxpayer
identification number of the transferee and surrendering this Warrant to the
Company for reissuance to the transferee(s) (and Holder, if applicable). Unless
the Company is filing financial information with the SEC pursuant to the
Securities Exchange Act of 1934, the Company shall have the right to refuse to
transfer any portion of this Warrant to any person who directly competes with
the Company. Upon any permitted partial transfer, the Company will issue and
deliver to the Holder a new Warrant or Warrants with respect to the Shares 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 Holder hereof as the owner for all purposes.
4.5 Notices. All notices and other communications from the Company to
the Holder, or vice versa, shall be deemed delivered and effective when given
personally or mailed by first-class registered or certified mail, postage
prepaid, at such address as may have been furnished to the Company or the
Holder, as the case may be, in writing by the Company or such Holder from time
to time.
4.6 Waiver. This Warrant and any term hereof may be changed, waived,
discharged or terminated only by an instrument in writing signed by the party
against which enforcement of such change, waiver, discharge or termination is
sought.
4.7 Headings. The headings in this Warrant are for the purposes of
convenience in reference only, and shall not be deemed to constitute a part
hereof.
4.7 Attorney's Fees. In the event of any dispute between the parties
concerning the terms and provisions of this Warrant, the party prevailing in
such dispute shall be entitled to collect from the other party all costs
incurred in such dispute, including reasonable attorney's fees.
4.8 Governing Law. This Warrant shall be governed by and construed in
accordance with the laws of the State of California, without giving effect to
its principles regarding conflicts of law.
4.9 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.
4.10 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.
4.11. 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 Holders of this Warrant or
otherwise conflicts with the provisions hereof. The rights granted to the
Holders hereunder do not in any way conflict with and are not inconsistent with
the rights granted to holders of the Company's securities under any other
agreement, except any right that has been waived.
4.12. Saturdays, Sundays and Holidays. If the Expiration Date falls
on a Saturday, Sunday or legal holiday, the Expiration Date shall be extended
automatically until 5:00 p.m. the next business day.
National Manufacturing Technologies, Inc.
"COMPANY"
By /s/ Patrick W. Moore
------------------------
Name Patrick W. Moore
------------------
Title: Chief Executive Officer
By /s Jennifer D. Brown
-----------------------
Name Jennifer D. Brown
-------------------
Title: Secretary
APPENDIX 1
NOTICE OF EXERCISE
------------------
1. The undersigned hereby elects to purchase __________________ shares
of the Common Stock of National Manufacturing Technologies, Inc, pursuant to
the terms of the attached Warrant, and tenders herewith payment of the purchase
price of such shares in full.
2. Please issue a certificate or certificates representing said shares
in the name of the undersigned or in such other name as is specified below:
__________________________________________
(Name)
__________________________________________
__________________________________________
(Address)
3. The undersigned represents it is acquiring the shares solely for its
own account and not as a nominee for any other party and not with a view toward
the resale or distribution thereof except in compliance with applicable
securities laws.
____________________________________
By __________________________________
(Signature)
_________________
(Date)
APPENDIX 2
NOTICE THAT WARRANT IS ABOUT TO EXPIRE
--------------------------------------
_____________, ______
Celtic Capital Corporation
2951 28th Street
Suite 2030
Santa Monica, CA 90405
Dear _____________________:
This is to advise you that the Warrant issued to you described below will
expire on the later of June 18, 2001 or the Outside Date (as defined in the
Warrant).
Issuer: National Manufacturing Technologies, Inc
Issue Date: July 6, 2000
--------------
Class of Security Issuable: Common
Exercise Price Per Share: $1.43
-----
Number of Shares Issuable: 200,000
-------
Procedure for Exercise:
Please contact [name of contact person at (phone number) with any questions
you may have concerning exercise of the Warrant. This is your only notice of
pending expiration.
National Manufacturing Technologies, Inc
By _____________________________
Its _____________________________
<PAGE>
EXHIBIT A
SHARES EXERCISE PRICE EXPIRATION
------ -------------- ----------
75,000 $ 0.44 12/03
87,500 $ 0.75 4/02
50,000 $ 0.04 1/05
100,000 $ 1.4375 7/02
