<PAGE>
Exhibit 1
THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES OR BLUE
SKY LAWS OF ANY STATE AND MAY NOT BE SOLD, OR OTHERWISE TRANSFERRED, IN THE
ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SUCH ACT AND UNDER
ANY SUCH APPLICABLE STATE LAWS, OR IN VIOLATION OF THE PROVISIONS OF THIS
WARRANT.
THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND
CONDITIONS OF A REGISTRATION RIGHTS AGREEMENT DATED AS OF JUNE 1, 2000.
THIS WARRANT ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS AS
SET FORTH IN A RIGHTS AGREEMENT BETWEEN SEMX CORPORATION AND CONTINENTAL STOCK
TRANSFER & TRUST COMPANY, AS RIGHTS AGENT, DATED AS OF JUNE 15, 1999, AS AMENDED
ON THE DATE HEREOF AND AS THE SAME MAY BE FURTHER AMENDED FROM TIME TO TIME (THE
"RIGHTS AGREEMENT"), THE TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY
REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF
SEMX CORPORATION AND AVAILABLE FOR INSPECTION BY THE HOLDER OF THIS WARRANT.
UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, SUCH RIGHTS WILL
BE EVIDENCED BY SEPARATE CERTIFICATES AND WILL NO LONGER BE EVIDENCED BY THIS
WARRANT. SEMX CORPORATION WILL MAIL TO THE HOLDER OF THIS WARRANT A COPY OF THE
RIGHTS AGREEMENT WITHOUT CHARGE WITHIN FIVE DAYS AFTER RECEIPT OF A WRITTEN
REQUEST THEREFOR. UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT,
RIGHTS ISSUED TO, OR HELD BY, ANY "PERSON" WHO IS, WAS OR BECOMES AN "ACQUIRING
PERSON" OR ANY "AFFILIATE" OR "ASSOCIATE" THEREOF (AS SUCH TERMS ARE DEFINED IN
THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL
AND VOID. IN NO EVENT MAY THE RIGHTS BE EXERCISED AFTER JUNE 29, 2009.
WARRANT
To Purchase Common Stock of
SEMX CORPORATION
Issuance Date: June 1, 2000
Issued To: ACI Capital America Fund, LP
No. of Shares of Common Stock: 900,000
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
1. DEFINITIONS..............................................................................................2
2. CURRENT WARRANT PRICE .................................................................................7
2.1. Initial Warrant Price...........................................................................7
2.2. Reset of Warrant Price..........................................................................7
3. EXERCISE OF WARRANT......................................................................................8
3.1. Manner of Exercise..............................................................................8
3.2. Payment of Taxes................................................................................9
3.3. Fractional Shares...............................................................................9
3.4. Continued Validity..............................................................................9
3.5. NASD Rule.......................................................................................9
4. TRANSFER, DIVISION AND COMBINATION......................................................................10
4.1. Transfer.......................................................................................10
4.2. Division and Combination.......................................................................10
4.3. Expenses.......................................................................................10
4.4. Maintenance of Books...........................................................................10
5. ADJUSTMENTS.............................................................................................10
5.1. Subdivisions and Combinations..................................................................11
5.2. Issuance of Additional Shares of Common Stock..................................................11
5.3. Issuance of Warrants or Other Rights...........................................................12
5.4. Issuance of Convertible Securities.............................................................12
5.5. Superseding Adjustment.........................................................................13
5.6. Other Provisions Applicable to Adjustments Under This Section..................................14
5.7. Reorganization, Reclassification, Liquidation, Dissolution, Merger, Consolidation or
Disposition of Assets..........................................................................16
5.8. Other Action Affecting Common Stock............................................................17
5.9. Certain Limitations............................................................................17
6. NOTICES TO WARRANT HOLDERS..............................................................................18
6.1. Notice of Adjustments..........................................................................18
6.2. Notice of Certain Corporate Action.............................................................18
7. NO IMPAIRMENT...........................................................................................18
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8. RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION WITH OR APPROVAL OF ANY GOVERNMENTAL
AUTHORITY...............................................................................................19
9. TAKING OF A RECORD; STOCK AND WARRANT TRANSFER BOOKS....................................................19
10. RESTRICTIONS ON TRANSFERABILITY.........................................................................20
10.1. Restrictive Legends............................................................................20
10.2. Notice of Proposed Transfers; Requests for Registration........................................21
10.3. No Transfer to Competitor......................................................................21
10.4. Termination of Restrictions....................................................................21
11. SUPPLYING INFORMATION...................................................................................22
12. LOSS OR MUTILATION......................................................................................22
13. OFFICE OF THE COMPANY...................................................................................22
14. REPURCHASE BY THE COMPANY OF WARRANTS
AND WARRANT STOCK.......................................................................................23
14.1. Obligation to Repurchase Warrant...............................................................23
14.2. Payment of Repurchase Price....................................................................24
15. REGISTRATION RIGHTS.....................................................................................25
16. LIMITATION OF LIABILITY.................................................................................25
17. DIVIDENDS ON UNDERLYING COMMON STOCK....................................................................25
17.1. Right to Receive Dividends.....................................................................25
17.2. Repayment of Dividends.........................................................................25
18. RIGHTS PLAN.............................................................................................26
18.1. Issuance of Rights.............................................................................26
18.2. Return of Rights...............................................................................27
19. MISCELLANEOUS...........................................................................................27
19.1. Nonwaiver and Expenses.........................................................................27
19.2. Notice Generally...............................................................................27
19.3. Indemnification................................................................................28
19.4. Successors and Assigns.........................................................................28
19.5. Amendment......................................................................................28
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19.6. Severability...................................................................................28
19.7. Headings.......................................................................................28
19.8. Governing Law..................................................................................29
19.9. Arbitration....................................................................................29
</TABLE>
THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER THE SECURITIES OR BLUE
SKY LAWS OF ANY STATE AND MAY NOT BE SOLD, OR OTHERWISE TRANSFERRED, IN THE
ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SUCH ACT AND UNDER
ANY SUCH APPLICABLE STATE LAWS, OR IN VIOLATION OF THE PROVISIONS OF THIS
WARRANT.
THIS WARRANT AND THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND
CONDITIONS OF A REGISTRATION RIGHTS AGREEMENT DATED AS OF JUNE 1, 2000.
THIS WARRANT ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS AS
SET FORTH IN A RIGHTS AGREEMENT BETWEEN SEMX CORPORATION AND CONTINENTAL STOCK
TRANSFER & TRUST COMPANY, AS RIGHTS AGENT, DATED AS OF JUNE 15, 1999, AS AMENDED
ON THE DATE HEREOF AND AS THE SAME MAY BE FURTHER AMENDED FROM TIME TO TIME (THE
"RIGHTS AGREEMENT"), THE TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY
REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF
SEMX CORPORATION AND AVAILABLE FOR INSPECTION BY THE HOLDER OF THIS WARRANT.
UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, SUCH RIGHTS WILL
BE EVIDENCED BY SEPARATE CERTIFICATES AND WILL NO LONGER BE EVIDENCED BY THIS
WARRANT. SEMX CORPORATION WILL MAIL TO THE HOLDER OF THIS WARRANT A COPY OF THE
RIGHTS AGREEMENT WITHOUT CHARGE WITHIN FIVE DAYS AFTER RECEIPT OF A WRITTEN
REQUEST THEREFOR. UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT,
RIGHTS ISSUED TO, OR HELD BY, ANY "PERSON" WHO IS, WAS OR BECOMES AN "ACQUIRING
PERSON" OR ANY "AFFILIATE" OR "ASSOCIATE" THEREOF (AS SUCH TERMS ARE DEFINED IN
THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL
AND VOID. IN NO EVENT MAY THE RIGHTS BE EXERCISED AFTER JUNE 29, 2009.
Warrant Number: 1 Date of Issuance: June 1, 2000
No. of Shares of Common Stock: 900,000
WARRANT
To Purchase Common Stock of
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SEMX CORPORATION
THIS IS TO CERTIFY THAT ACI Capital America Fund, LP or its registered
assigns, is entitled, at any time during the Exercise Period (as hereinafter
defined), to purchase from SEMX Corporation, a Delaware corporation (the
"Company"), nine hundred thousand (900,000) shares of Common Stock (as
hereinafter defined and subject to adjustment as provided herein), in whole or
in part, including fractional parts, at an initial purchase price of $10.00 per
share (subject to adjustment as set forth herein), all on the terms and
conditions and pursuant to the provisions hereinafter set forth.
1. DEFINITIONS
As used in this Warrant, the following terms have the respective meanings
set forth below:
"Additional Shares of Common Stock" shall mean all shares of Common Stock
issued by the Company after the Closing Date, other than Warrant Stock, whether
now authorized or not.
"Affiliate" of any Person shall mean a Person that directly or indirectly,
through one or more intermediaries, controls or is controlled by or is under
common control with, such Person.
"ASP" shall mean American Silicon Products, Inc., a Rhode Island
corporation.
"ASP Common Stock" shall mean the Common Stock of ASP.
"Business Day" shall mean any day that is not a Saturday or Sunday or a day
on which banks are required or permitted to be closed in the State of New York.
"Change of Control" shall mean the occurrence of one or more of the
following events:
(1) any Person or group (as that term is used in Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended) of persons or entities (in
each case, a "Beneficial Owner"), in a single transaction or through a series
of related transactions, shall have become the beneficial owner of a majority
(by voting power or otherwise) of the securities of the Company ordinarily
having the right to vote in the election of directors;
(2) during any consecutive three-year period commencing on or after the
Closing Date, individuals who at the beginning of such period constituted the
Board of Directors of the Company (together with any new directors whose
election by such Board of Directors or
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whose nomination for election by the stockholders of the Company was approved
by a vote of 66 2/3% of the directors then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the Board of Directors then in office;
(3) any sale, lease, exchange or other transfer (in one transaction or
a series of related transactions) of all, or substantially all, the assets of
the Company to any Beneficial Owner (other than any wholly owned subsidiary
of the Company);
(4) the merger or consolidation of the Company with or into another
corporation or the merger of another corporation into the Company with the
effect that immediately after such transaction any Beneficial Owner shall
have become the beneficial owner of securities of the surviving corporation
of such merger or consolidation representing a majority of the combined
voting power of the outstanding securities of the surviving corporation
ordinarily having the right to vote in the election of directors; or
(5) the adoption of a plan leading to the liquidation or dissolution of
the Company.
"Closing Date" shall mean June 1, 2000.
"Commission" shall mean the Securities and Exchange Commission or any other
federal agency then administering the Securities Act and other federal
securities laws.
"Common Stock" shall mean (except where the context otherwise indicates)
the Common Stock, $.10 par value, of the Company as constituted on the Closing
Date, and any capital stock into which such Common Stock may thereafter be
changed, and shall also include (i) capital stock of the Company of any other
class (regardless of how denominated) issued to the holders of shares of Common
Stock upon any reclassification thereof which is also not preferred as to
dividends or assets over any other class of stock of the Company and which is
not subject to redemption and (ii) shares of common stock of any successor or
acquiring corporation (as defined in Section 5.7) received by or distributed to
the holders of Common Stock of the Company in the circumstances contemplated by
Section 5.7.
"Convertible Securities" shall mean evidences of indebtedness, shares of
stock or other securities which are convertible into or exchangeable, with or
without payment of additional consideration in cash or property, for Additional
Shares of Common Stock, either immediately or upon the occurrence of a specified
date or a specified event.
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<PAGE>
"Current Market Price" shall mean, in respect of any share of Common Stock
(or Other Common Stock, as the case may be) on any date herein specified, the
average of the Daily Market Prices for the 20 consecutive Trading Days
immediately preceding such date.
"Current Warrant Price" shall mean, in respect of a share of Common Stock
at any date herein specified, the price at which a share of Common Stock may be
purchased pursuant to this Warrant on such date, as set forth in Section 2
hereof, subject to adjustment pursuant to Section 5.
"Daily Market Price" shall mean, for each given Trading Day: (i) the last
sale price on such day on the National Stock Exchange on which the Common Stock
(or the Other Common Stock, as the case may be) is then listed or admitted to
trading, (ii) if no sale takes place on such day on such exchange, the last
reported sale price as officially quoted on such exchange, (iii) if the Common
Stock (or the Other Common Stock, as the case may be) is not then listed or
admitted to trading on any National Stock Exchange, the last reported sale price
on the over-the-counter market, as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding to its functions
of reporting prices), or if such sale price is not available on such date, the
average of the closing bid and asked prices on such date as reported by the
National Quotation Bureau Incorporated (or any similar organization or agency
succeeding to its functions of reporting prices), or (iv) if there is no such
organization or agency, as furnished by any member of the NASD selected mutually
by the Majority Holders and the Company or, if they cannot agree upon such
selection, by a member selected by two such members of the NASD, one of which
shall be selected by the Majority Holders and one of which shall be selected by
the Company.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
or any similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect from time to time.
"Exercise Period" shall mean the period beginning on the Closing Date and
ending at 5:00 P.M., New York time, on the fifth anniversary of the Closing
Date.
"Expiration Date" shall mean the date of the expiration of the Exercise
Period.
"Fully Diluted Outstanding" shall mean, when used with reference to Common
Stock, at any date as of which the number of shares thereof is to be determined,
all shares of Common Stock Outstanding at such date and all shares of Common
Stock issuable in respect of this Warrant outstanding on such date and other
options or warrants to purchase, or securities convertible into, shares of
Common Stock outstanding on such date, whether or not such options, warrants or
other securities are presently convertible or exercisable.
4
<PAGE>
"Holder" shall mean, as the context requires, the Person in whose name this
Warrant or one of the other Warrants is registered on the books of the Company
maintained for such purpose and/or the Person holding any Warrant Stock.
"Independent Counsel" shall mean counsel to the Holder reasonably
acceptable to the Company.
"Majority Holders" shall mean, at any given time, holders of Warrants then
outstanding who would hold a majority of the Common Stock purchasable upon
exercise of all Warrants in the event all Warrants were so exercised at such
time.
"NASD" shall mean the National Association of Securities Dealers, Inc., or
any successor corporation thereto.
"National Stock Exchange" shall mean the Nasdaq Stock Market, the New York
Stock Exchange or the American Stock Exchange.
"New Securities" shall mean any Additional Shares of Common Stock, and any
rights or options to purchase any Additional Shares of Common Stock, and any
Convertible Securities.
"Other Common Stock" shall mean the common stock of a company other than
the Company, including without limitation ASP Common Stock.
"Other Property" shall have the meaning set forth in Section 5.7.
"Outstanding" shall mean, when used with reference to Common Stock, at any
date as of which the number of shares thereof is to be determined, all issued
shares of Common Stock, except shares then owned or held by or for the account
of the Company or any Subsidiary, and shall include all shares issuable in
respect of outstanding scrip or any certificates representing fractional
interests in shares of Common Stock.
"Payment Shares" shall have the meaning set forth in Section 3.1.
"Permitted Issuances" shall mean (i) the issuance of shares of Common Stock
pursuant to an underwritten public offering; (ii) the issuance of shares of
Common Stock upon exercise of the Warrants; (iii) the issuance of shares of
Series B Preferred Stock pursuant to the Preferred Stock Purchase Agreement;
(iv) the issuance of up to 100,000 shares of Common Stock in connection with the
Company's acquisition of the assets of Advanced Packaging Concepts, Inc.; (v)
the issuance of shares of Common Stock upon the exercise of options issued to
management employees of the Company or its Subsidiaries pursuant to the Stock
Option Plans; and (vi) the issuance of up to a total of
5
<PAGE>
60,000 shares of Common Stock pursuant to warrants issued to VM Equity Partners,
Inc. and Rodman and Renshaw as finders fees in connection with the transactions
related to this Warrant.
"Person" shall mean any individual, sole proprietorship, partnership, joint
venture, trust, incorporated organization, association, corporation,
institution, public benefit corporation, entity or government (whether federal,
state, county, city, municipal or otherwise, including, without limitation, any
instrumentality, division, agency, body or department thereof).
"Preferred Stock Purchase Agreement" shall mean the Preferred Stock
Purchase Agreement dated as of the Closing Date, by and among the Company, the
initial Holder hereof and other designated purchasers.
"Registration Rights Agreement" shall mean the Registration Rights
Agreement dated as of the Closing Date among the Company, the initial Holder
hereof and other designated parties.
"Reorganization" shall have the meaning set forth in Section 5.7.
"Repurchase Price" shall have the meaning set forth in Section 14.2.
"Reset Date" shall have the meaning set forth in Section 2.2.
"Restricted Common Stock" shall mean shares of Common Stock which are, or
which upon their issuance on the exercise of this warrant would be, evidenced by
a certificate bearing the restrictive legend set forth in Section 10.1(a).
"Restrictions" shall have the meaning set forth in Section 14.1(c).
"Securities Act" shall mean the Securities Act of 1933, as amended, or any
similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Series B Certificate of Designation" shall mean the Certificate of
Designation, Number, Powers, Preferences and Relative Participating, Optional
and Other Rights of Series B Preferred Stock of the Company, as in effect on the
Closing Date.
"Series B Preferred Stock" shall mean the Company's Series B Preferred
Stock issued pursuant to the Series B Certificate of Designation and the
Preferred Stock Purchase Agreement.
"Stock Option Plans" shall mean the Company's Amended Employee's Incentive
Stock Option Plan adopted by the Board of Directors on May 27, 1993, and the
Company's non-
6
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qualified stock option plan for members of its Board of Directors adopted by the
Board of Directors on January 31, 1995.
"Subsidiary" shall mean any corporation of which an aggregate of more than
50% of the outstanding stock having ordinary voting power to elect a majority of
the board of directors of such corporation (irrespective of whether, at the
time, stock of any other class or classes of such corporation shall have or
might have voting power by reason of the happening of any contingency) is at the
time, directly or indirectly, owned legally or beneficially by the Company
and/or one or more Subsidiaries of the Company.
"Trading Day" shall mean any day on which stock is traded on the New York
Stock Exchange.
"Transfer" shall mean any disposition of any Warrant or Warrant Stock or of
any interest in either thereof, which would constitute a sale thereof within the
meaning of the Securities Act.
"Underlying Series B Preferred Stock" shall mean the Series B Preferred
Stock issued to the initial Holder of this Warrant on the date this Warrant was
originally issued.
"Warrants" shall mean this warrant and all other warrants issued pursuant
to the terms of the Preferred Stock Purchase Agreement, and all warrants issued
upon Transfer, division or combination of, or in substitution or exchange for,
any thereof.
"Warrant Price" shall mean an amount equal to (i) the number of shares of
Common Stock being purchased upon exercise of this Warrant pursuant to Section
3.1, multiplied by (ii) the Current Warrant Price as of the date of such
exercise.
"Warrant Stock" shall mean the shares of Common Stock purchased by Holders
of the Warrants upon the exercise thereof.
2. CURRENT WARRANT PRICE
2.1. Initial Warrant Price. For a period commencing on the Closing Date and
concluding at 5:00 P.M., New York time on the first anniversary of the Closing
Date ("Year One"), the Current Warrant Price shall be $10.00 per share of Common
Stock, subject to adjustment pursuant to Section 5.
2.2. Reset of Warrant Price. From and after the first Business Day
following the first anniversary of the Closing Date (the "Reset Date"), the
Current Warrant Price, subject to adjustment pursuant to Section 5 and the
remaining provisions of this Section 2.2, shall be the lower of (a) the then
existing Current Warrant Price pursuant to Section 2.1, or (b) the lowest
average Daily
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Market Price of the Common Stock for any given 20 consecutive Trading Days
during Year One. In the event that during Year One the Company issues dividends
to the Holder hereof under Section 17 in the form of cash and/or shares of Other
Common Stock, then the amount calculated pursuant to clause (b) in the previous
sentence shall be increased by (i) the total amount of any cash dividends
distributed to any Holder prior to the Reset Date on account of one share of
Common Stock for which this Warrant is exercisable, plus (ii) the total value of
any shares of Other Common Stock distributed to any Holder prior to the Reset
Date on account of one share of Common Stock for which this Warrant is
exercisable, valued at the lowest average Daily Market Price of such shares of
Other Common Stock for any given 20 consecutive Trading Days during Year One in
which any Holder owned such shares of Other Common Stock, in either case as
equitably adjusted for stock splits, combinations, stock dividends and the like.
Notwithstanding the foregoing, in no event shall the Current Warrant Price be
adjusted pursuant to this Section 2.2 to an amount which is lower than $7.00, as
such may be adjusted pursuant to Section 5.
3. EXERCISE OF WARRANT
3.1. Manner of Exercise. At any time during the Exercise Period, the Holder
may exercise this Warrant, on any Business Day, for all or any part of the
number of shares of Common Stock purchasable hereunder.
In order to exercise this Warrant, in whole or in part, the Holder shall
deliver to the Company at its office at 1 Labriola Court, Armonk, New York
10504, or at the office or agency designated by the Company pursuant to Section
13, (i) a written notice of the Holder's election to exercise this Warrant,
which notice shall specify the number of shares of Common Stock to be purchased,
(ii) payment of the Warrant Price in the manner provided below, and (iii) this
Warrant. Such notice shall be substantially in the form of the subscription form
appearing at the end of this Warrant as Exhibit A, duly executed by the Holder
or its duly appointed agent or attorney. Upon receipt thereof, the Company
shall, as promptly as practicable, and in any event within five (5) Business
Days thereafter, execute or cause to be executed and deliver or cause to be
delivered to the Holder a certificate or certificates representing the aggregate
number of full shares of Common Stock issuable upon such exercise, together with
cash in lieu of any fraction of a share, as hereinafter provided. The stock
certificate or certificates so delivered shall be, to the extent possible, in
such denomination or denominations as the Holder shall request in the notice and
shall be registered in the name of the Holder or, subject to Section 10, such
other name as shall be designated in the notice. This Warrant shall be deemed to
have been exercised and such certificate or certificates shall be deemed to have
been issued, and the Holder or any other Person so designated to be named
therein shall be deemed to have become a holder of record of such shares for all
purposes, as of the date the notice, together with the cash or check or checks,
if any, and this Warrant, are received by the Company as described above and all
taxes required to be paid by the Holder, if any, pursuant to Section 3.2 prior
to the issuance of such shares have been paid. If this Warrant shall have been
exercised in part, the Company shall, at the time of delivery of the certificate
or certificates representing Warrant Stock, deliver to the Holder a new
8
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Warrant evidencing the rights of the Holder to purchase the unpurchased shares
of Common Stock called for by this Warrant, which new Warrant shall in all other
respects be identical with this Warrant, or, at the request of the Holder,
appropriate notation may be made on this Warrant and the same returned to the
Holder. Notwithstanding any provision herein to the contrary, the Company shall
not be required to register shares in the name of any Person who acquired this
Warrant (or part hereof) or any Warrant Stock otherwise than in accordance with
this Warrant.
Payment of the Warrant Price shall be made at the option of the Holder by
(i) cash, (ii) wire transfer to an account in a bank located in the United
States designated for such purpose by the Company, (iii) certified or official
bank check, (iv) delivery of shares of Series B Preferred Stock with an
aggregate stated value, plus accrued and unpaid dividends thereon, equal to the
Warrant Price, (v) delivery of shares of Common Stock, valued per share at the
Daily Market Price as of the last Trading Day prior to the date of delivery of
such shares to the Company, with an aggregate value equal to the Warrant Price,
or (vi) any combination of the foregoing; provided, however, that the Holder
shall have the right, at its election, in lieu of delivering the Warrant Price
in cash, to instruct the Company in the form of Subscription Notice to retain,
in payment of the Warrant Price, a number of shares of Common Stock (the
"Payment Shares") equal to the quotient of the aggregate Warrant Price of the
shares as to which this Warrant is then being exercised divided by the Current
Market Price.
3.2. Payment of Taxes. All shares of Common Stock issuable upon the
exercise of this Warrant pursuant to the terms hereof shall be validly issued,
fully paid and nonassessable and without any preemptive rights. The Company
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 thereof,
unless such tax or charge is imposed by law upon the Holder, in which case such
taxes or charges shall be paid by the Holder. The Company shall not be required,
however, to pay any tax or other charge imposed in connection with any transfer
involved in the issue of any certificate for shares of Common Stock issuable
upon exercise of this Warrant in any name other than that of the Holder, and in
such case the Company shall not be required to issue or deliver any stock
certificate until such tax or other charge has been paid or it has been
established to the satisfaction of the Company that no such tax or other charge
is due.
3.3. Fractional Shares. The Company shall not be required to issue a
fractional share of Common Stock upon exercise of any Warrant. As to any
fraction of a share which the Holder of one or more Warrants, the rights under
which are exercised in the same transaction, would otherwise be entitled to
purchase upon such exercise, the Company shall pay a cash adjustment in respect
of such final fraction in an amount equal to the same fraction of the Current
Market Price per share of Common Stock on the date of exercise.
3.4. Continued Validity. A holder of shares of Common Stock issued upon the
exercise of this Warrant, in whole or in part (other than a holder who acquires
such shares after the same have been publicly sold pursuant to a Registration
Statement under the Securities Act or sold
9
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pursuant to Rule 144 thereunder), shall continue to be entitled with respect to
such shares to all rights to which it would have been entitled as the Holder
under Sections 7, 11, 14, 15, and 16 of this Warrant, subject to the obligations
thereunder. The Company will, at the time of each exercise of this Warrant, in
whole or in part, upon the request of the holder of the shares of Common Stock
issued upon such exercise hereof, acknowledge in writing, in form reasonably
satisfactory to such holder, its continuing obligation to afford to such holder
all such rights; provided, however, that if such holder shall fail to make any
such request, such failure shall not affect the continuing obligation of the
Company to afford to such holder all such rights.
3.5. NASD Rule. Notwithstanding any other provision hereof, in no event
shall this Warrant be exercisable if such exercise would violate NASD Rule
4460(i)(1)(D)(ii) or any successor provision. If the Holder is unable to
exercise this Warrant because such exercise would violate said rule, the
Company, at the request of the Holder, shall cooperate in a reasonable manner to
seek assurances from The Nasdaq Stock Market, including the waiver of said NASD
rule, in order to facilitate the exercise of this Warrant.
4. TRANSFER, DIVISION AND COMBINATION
4.1. Transfer. Subject to compliance with Section 10, Transfer of this
Warrant and all rights hereunder, in whole or in part, shall be registered on
the books of the Company to be maintained for such purpose, upon surrender of
this Warrant at the principal office of the Company referred to in Section 3.1
or the office or agency designated by the Company pursuant to Section 13,
together with a written assignment of this Warrant substantially in the form of
Exhibit B hereto duly executed by the Holder or its agent or attorney and if
such Transfer is not to be made pursuant to Section 10, funds sufficient to pay
any transfer taxes payable upon the making of such Transfer. Upon such surrender
and, if required, such payment, the Company shall, subject to Section 10,
execute and deliver a new Warrant or Warrants in the name(s) of the assignee or
assignees and in the denomination(s) specified in such instrument of assignment,
and shall issue to the assignor a new Warrant evidencing the portion of this
Warrant not so assigned, and this Warrant shall promptly be canceled. A Warrant,
if properly assigned in compliance with Section 10, may be exercised by a new
Holder for the purchase of shares of Common Stock without having a new Warrant
issued. If requested by the Company, a new Holder shall acknowledge in writing,
in form reasonably satisfactory to the Company, such Holder's continuing
obligation under Section 10.
4.2. Division and Combination. Subject to Section 10, this Warrant may be
divided or combined with other Warrants upon presentation hereof at the
aforesaid office or agency of the Company, together with a written notice
specifying the names and denominations in which new Warrants are to be issued,
signed by the Holder or its agent or attorney. Subject to compliance with
Section 4.1 and with Section 10, as to any transfer which may be involved in
such division or combination, the Company shall execute and deliver a new
Warrant or Warrants in exchange for the Warrant or Warrants to be divided or
combined in accordance with such notice.
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4.3. Expenses. The Company shall prepare, issue and deliver at its own
expense (other than transfer taxes) the new Warrant or Warrants under this
Section 4.
4.4. Maintenance of Books. The Company agrees to maintain, at its aforesaid
office or agency, books for the registration and the registration of transfer of
the Warrants.
5. ADJUSTMENTS
The number of shares of Common Stock for which this Warrant is exercisable,
or the price at which such shares may be purchased upon exercise of this Warrant
(as well as each of the prices included in the calculation to determine the
Current Warrant Price after Year One pursuant to Section 2.2), shall be subject
to adjustment from time to time as set forth in this Section 5. The Company
shall give the Holder notice of any event described below which requires an
adjustment pursuant to this Section 5 at the time of such event.
5.1. Subdivisions and Combinations. If at any time the Company shall:
(a) subdivide its outstanding shares of Common Stock into a larger
number of shares of Common Stock, or
(b) combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock, by a reverse stock split or otherwise,
then (i) the number of shares of Common Stock for which this Warrant is
exercisable immediately after the occurrence of any such event shall be adjusted
to equal the number of shares of Common Stock which a record holder of the same
number of shares of Common Stock for which this Warrant is exercisable
immediately prior to the occurrence of such event would own or be entitled to
receive after the happening of such event, and (ii) the Current Warrant Price
shall be adjusted to equal (A) the Current Warrant Price multiplied by the
number of shares of Common Stock for which this Warrant is exercisable
immediately prior to the adjustment divided by (B) the number of shares for
which this Warrant is exercisable immediately after such adjustment.
5.2. Issuance of Additional Shares of Common Stock. (a) In the event the
Company shall issue or sell any Additional Shares of Common Stock, other than
Permitted Issuances, for a consideration per Additional Share of Common Stock
less than the Current Market Price, then the Current Warrant Price shall be
reduced to a price calculated by multiplying the then existing Current Warrant
Price by a fraction the numerator of which shall be the sum of (i) the number of
Fully Diluted Outstanding shares of Common Stock immediately prior to such issue
or sale multiplied by the Current Market Price per share of Common Stock
immediately prior to such issue or sale plus (ii) the consideration received by
the Company upon such issue or sale, and the denominator of which shall be the
total number of Fully Diluted Outstanding shares of Common Stock immediately
after such issue or
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sale multiplied by the Current Market Price per share of Common Stock
immediately prior to such issue or sale.
For purposes of this subsection (a), the date as of which the Current
Market Price per share of Common Stock shall be computed shall be the earlier of
the date upon which the Company shall (i) enter into a firm contract for the
issuance of such shares or (ii) issue such shares.
Upon any adjustment of the Current Warrant Price as provided in this
Section 5.2(a), the Holder shall thereafter be entitled to purchase, at the
Current Warrant Price resulting from such adjustment, the number of shares of
Common Stock (calculated to the nearest 1/100th of a share) obtained by
multiplying the Current Warrant Price in effect immediately prior to such
adjustment by the number of shares of Common Stock purchasable hereunder
immediately prior to such adjustment and dividing the product thereof by the
Current Warrant Price resulting from such adjustment.
(b) The provisions of this Section 5.2 shall not apply to any issuance
of Additional Shares of Common Stock for which an adjustment is provided under
Section 5.1. No adjustment shall be made under this Section 5.2 upon the
issuance of any Additional Shares of Common Stock which are issued pursuant to
the exercise of any warrants or other subscription or purchase rights or
pursuant to the exercise of any conversion or exchange rights in any Convertible
Securities, if any such adjustment shall previously have been made upon the
issuance of such warrants or other rights or upon the issuance of such
Convertible Securities (or upon the issuance of any warrant or other rights
therefor) pursuant to Section 5.3 or Section 5.4.
5.3. Issuance of Warrants or Other Rights. Except with respect to Permitted
Issuances and distributions on behalf of which a payment is made to the Holder
of this Warrant pursuant to Section 17 hereof, if at any time the Company shall
take a record of the holders of its Common Stock for the purpose of entitling
them to receive a distribution of, or shall in any manner (whether directly or
by assumption in a merger in which the Company is the surviving corporation)
issue or sell, any warrants (other than the Warrants) or other rights to
subscribe for or purchase any Additional Shares of Common Stock or any
Convertible Securities, whether or not the rights to exchange or convert
thereunder are immediately exercisable, and the price per share for which Common
Stock is issuable upon the exercise of such warrants or other rights or upon
conversion or exchange of such Convertible Securities shall be less than the
Current Market Price in effect immediately prior to the time of such
distribution, issue or sale, then the number of shares of Common Stock for which
this Warrant is exercisable and the Current Warrant Price shall be adjusted as
provided in Section 5.2(a) on the basis that (i) the maximum number of
Additional Shares of Common Stock issuable pursuant to all such warrants or
other rights or necessary to effect the conversion or exchange of all such
Convertible Securities shall be deemed to have been issued and outstanding, (ii)
the price per share for such Additional Shares of Common Stock shall be deemed
to be the lowest price per share at which such Additional Shares of Common Stock
are issuable to such holders, and (iii) the Company shall have received all of
the consideration, if any, payable for such warrants or other
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rights as of the date of the actual issuance thereof. No further adjustments of
the number of shares of Common Stock for which this Warrant is exercisable or of
the Current Warrant Price shall be made upon the actual issue of such Common
Stock or of such Convertible Securities upon exercise of such warrants or other
rights or upon the actual issue of such Common Stock upon such conversion or
exchange of such Convertible Securities.
5.4. Issuance of Convertible Securities. Except with respect to Permitted
Issuances and distributions on behalf of which a payment is made to the Holder
of this Warrant pursuant to Section 17 hereof, if at any time the Company shall
take a record of the holders of its Common Stock for the purpose of entitling
them to receive a distribution of, or shall in any manner (whether directly or
by assumption in a merger in which the Company is the surviving corporation)
issue or sell, any Convertible Securities, whether or not the rights to exchange
or convert thereunder are immediately exercisable, and the price per share for
which Common Stock is issuable upon such conversion or exchange shall be less
than the Current Market Price in effect immediately prior to the time of such
issue or sale, then the number of shares of Common Stock for which this Warrant
is exercisable and the Current Warrant Price shall be adjusted as provided in
Section 5.2(a) on the basis that (i) the maximum number of Additional Shares of
Common Stock issuable upon the conversion or exchange of all such Convertible
Securities shall be deemed to have been issued and outstanding, (ii) the price
per share of such Additional Shares of Common Stock shall be deemed to be the
lowest possible price in any range of prices at which such Additional Shares of
Common Stock are available to such holders, and (iii) the Company shall have
received all of the consideration payable therefor, if any, as of the date of
actual issuance of such Convertible Securities. No further adjustment of the
number of shares of Common Stock for which this Warrant is exercisable or of the
Current Warrant Price shall be made under this Section 5.4 upon the issuance of
any Convertible Securities which are issued pursuant to the exercise of any
warrants or other subscription or purchase rights therefor, if any such
adjustment shall previously have been made upon the issuance of such warrants or
other rights pursuant to Section 5.3. No further adjustments of the number of
shares of Common Stock for which this Warrant is exercisable or of the Current
Warrant Price shall be made upon the actual issue of such Common Stock upon
conversion or exchange of such Convertible Securities and, if any issue or sale
of such Convertible Securities is made upon exercise of any warrant or other
right to subscribe for or to purchase or any warrant or other right to purchase
any such Convertible Securities for which adjustments thereof have been or are
to be made pursuant to other provisions of this Section 5, no further
adjustments shall be made by reason of such issue or sale.
5.5. Superseding Adjustment. If, at any time after any adjustment of the
number of shares of Common Stock for which this Warrant is exercisable shall
have been made pursuant to Section 5.3 or Section 5.4 as the result of any
issuance of warrants, rights or Convertible Securities, and either
(a) such warrants or rights, or the right of conversion or exchange in
such other Convertible Securities, shall expire, and all or a portion of
such warrants or rights,
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or the right of conversion or exchange with respect to all or a portion of
such other Convertible Securities, as the case may be, shall not have been
exercised, or
(b) the consideration per share for which shares of Common Stock are
issuable pursuant to such warrants or rights, or such other Convertible
Securities, shall be increased or decreased by virtue of provisions therein
contained,
then such previous adjustment shall be rescinded and annulled and the Additional
Shares of Common Stock which were deemed to have been issued by virtue of the
computation made in connection with the adjustment so rescinded and annulled
shall no longer be deemed to have been issued by virtue of such computation.
Thereupon, a recomputation shall be made of the effect of such rights or options
or other Convertible Securities on the then outstanding Warrants, but not on any
then outstanding Warrant Stock, on the basis of
(c) treating the number of Additional Shares of Common Stock or other
property, if any, theretofore actually issued or issuable pursuant to the
previous exercise of any such warrants or rights or any such right of
conversion or exchange, as having been issued on the date or dates of any
such exercise and for the consideration actually received and receivable
therefor, and
(d) treating any such warrants or rights or any such other Convertible
Securities which then remain outstanding as having been granted or issued
immediately after the time of such increase or decrease of the
consideration per share for which shares of Common Stock or other property
are issuable under such warrants or rights or other Convertible Securities.
5.6. Other Provisions Applicable to Adjustments Under This Section. The
following provisions shall be applicable to the making of adjustments provided
for in this Section 5:
(a) Computation of Consideration. To the extent that any Additional
Shares of Common Stock or any Convertible Securities or any warrants or
other rights to subscribe for or purchase any Additional Shares of Common
Stock or any Convertible Securities shall be issued for cash consideration,
the consideration received by the Company therefor shall be the amount of
the cash received by the Company therefor, or, if such Additional Shares of
Common Stock or Convertible Securities are offered by the Company for
subscription, the subscription price, or, if such Additional Shares of
Common Stock or Convertible Securities are sold to underwriters or dealers
for public offering without a subscription offering, the public offering
price (in any such case subtracting any amounts paid or receivable for
accrued interest or accrued dividends, but not subtracting any
compensation, discounts or expenses paid or incurred by the Company for and
in the underwriting of, or otherwise in connection
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with, the issuance thereof). To the extent that such issuance shall be for
a consideration other than cash, then, except as herein otherwise expressly
provided, the amount of such consideration shall be deemed to be the fair
value of such consideration at the time of such issuance as determined in
good faith by the Board of Directors of the Company. In case any Additional
Shares of Common Stock or any Convertible Securities or any warrants or
other rights to subscribe for or purchase such Additional Shares of Common
Stock or Convertible Securities shall be issued in connection with any
merger in which the Company issues any securities, the amount of
consideration therefor shall be deemed to be the fair value, as determined
in good faith by the Board of Directors of the Company, of such portion of
the assets and business of the nonsurviving corporation as such Board in
good faith shall determine to be attributable to such Additional Shares of
Common Stock, Convertible Securities, warrants or other rights, as the case
may be. The consideration for any Additional Shares of Common Stock
issuable pursuant to any warrants or other rights to subscribe for or
purchase the same shall be the consideration received by the Company for
issuing such warrants or other rights plus the additional consideration
payable to the Company upon exercise of such warrants or other rights. The
consideration for any Additional Shares of Common Stock issuable pursuant
to the terms of any Convertible Securities shall be the consideration, if
any, received by the Company for issuing warrants or other rights to
subscribe for or purchase such Convertible Securities, plus the
consideration paid or payable to the Company in respect of the subscription
for or purchase of such Convertible Securities, plus the additional
consideration, if any, payable to the Company upon the exercise of the
right of conversion or exchange in such Convertible Securities. In case of
the issuance at any time of any Additional Shares of Common Stock or
Convertible Securities in payment or satisfaction of any dividends upon any
class of stock other than Common Stock, the Company shall be deemed to have
received for such Additional Shares of Common Stock or Convertible
Securities a consideration equal to the amount of such dividend so paid or
satisfied.
(b) When Adjustments to Be Made. The adjustments required by this
Section 5 shall be made whenever and as often as any specified event
requiring an adjustment shall occur, except that any adjustment of the
number of shares of Common Stock for which this Warrant is exercisable that
would otherwise be required may be postponed (except in the case of a
subdivision or combination of shares of the Common Stock, as provided for
in Section 5.1) up to, but not beyond the date of exercise if such
adjustment either by itself or with other adjustments not previously made
adds or subtracts less than 1% of the shares of Common Stock for which this
Warrant is exercisable immediately prior to the making of such adjustment.
Any adjustment representing a change of less than such minimum amount
(except as aforesaid) which is postponed shall be carried forward and made
upon the earlier of (i) the date upon which such adjustment, together with
other adjustments required by this
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Section 5 and not previously made, would result in a minimum adjustment,
and (ii) the date of exercise. For the purpose of any adjustment, any
specified event shall be deemed to have occurred at the close of business
on the date of its occurrence.
(c) Fractional Interests. In computing adjustments under this Section
5, fractional interests in Common Stock shall be taken into account to the
nearest 1/10th of a share.
(d) When Adjustment Not Required. If the Company shall take a record of
the holders of its Common Stock for the purpose of entitling them to
receive a dividend or distribution or subscription or purchase rights and
shall, thereafter and before the distribution to stockholders thereof,
legally abandon its plan to pay or deliver such dividend, distribution,
subscription or purchase rights, then thereafter no adjustment shall be
required by reason of the taking of such record and any such adjustment
previously made in respect thereof shall be rescinded and annulled.
(e) Escrow of Warrant Stock. If after any property becomes
distributable pursuant to this Section 5 by reason of the taking of any
record of the holders of Common Stock, but prior to the occurrence of the
event for which such record is taken, the Holder exercises this Warrant,
any Additional Shares of Common Stock issuable and other property
distributable upon exercise by reason of such adjustment shall be held in
escrow for the Holder by the Company to be issued to the Holder upon and to
the extent that the event actually takes place, upon payment of the then
Current Warrant Price. Notwithstanding any other provision to the contrary
herein, if the event for which such record was taken fails to occur or is
rescinded, then such escrowed shares shall be canceled by the Company and
escrowed property returned.
(f) Challenge to Good Faith Determination. Whenever the Board of
Directors of the Company shall be required to make a determination in good
faith of the fair value of any item under this Section 5, such
determination may be challenged in good faith by the Majority Holders, and
any dispute shall be resolved by an investment banking firm of recognized
national standing selected by the Company and acceptable to the Majority
Holders.
5.7. Reorganization, Reclassification, Liquidation, Dissolution, Merger,
Consolidation or Disposition of Assets. (a) Subject to the provisions of Section
5.7(b), in case the Company shall reorganize its capital, reclassify its capital
stock, liquidate its assets, dissolve, consolidate or merge with or into another
corporation (where the Company is not the surviving corporation or where there
is a change in or distribution with respect to the Common Stock of the Company),
or sell, transfer or otherwise dispose of all or substantially all its property,
assets or business to another corporation or other entity (hereinafter, a
"Reorganization") and, pursuant to the terms of
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such Reorganization, shares of common stock of the successor or acquiring
corporation, or any cash, shares of stock or other securities or property of any
nature whatsoever (including warrants or other subscription or purchase rights)
in addition to or in lieu of common stock of the successor or acquiring
corporation ("Other Property"), are to be received by or distributed to the
holders of Common Stock of the Company, then the Holder shall have the right
following the effectiveness of such Reorganization to receive, upon exercise of
such Warrant, or, in the case of a liquidation of assets or a dissolution to
receive, upon such liquidation or dissolution, without taking any further
action, the number of shares of common stock of the successor or acquiring
corporation or of the Company, if it is the surviving corporation, and Other
Property receivable upon or as a result of such Reorganization by a holder of
the number of shares of Common Stock for which this Warrant is exercisable
immediately prior to such event (without regard to the number of shares of
Common Stock available or set aside for issuance upon such exercise). In case of
any such Reorganization, the successor or acquiring corporation (if other than
the Company) shall expressly assume the due and punctual observance and
performance of each and every covenant and condition of this Warrant to be
performed and observed by the Company and all the obligations and liabilities
hereunder, subject to such appropriate modifications as are satisfactory to the
Holder in order to provide for adjustments of shares of the Common Stock for
which this Warrant is exercisable which shall be as nearly equivalent as
practicable to the adjustments provided for in this Section 5. For purposes of
this Section 5.7 "common stock of the successor or acquiring corporation" shall
include stock of such corporation of any class which is not preferred as to
dividends or assets over any other class of stock of such corporation and which
is not subject to redemption and shall also include any evidences of
indebtedness, shares of stock or other securities which are convertible into or
exchangeable for any such stock, either immediately or upon the arrival of a
specified date or the happening of a specified event and any warrants or other
rights to subscribe for or purchase any such stock. The foregoing provisions of
this Section 5.7 shall similarly apply to successive Reorganizations.
(b) From and after the expiration of 18 months following the Closing
Date, in the event of a Reorganization in which the Company is not the surviving
corporation and in which Other Property is to be received by or distributed to
the holders of Common Stock of the Company, and in the event the successor or
acquiring corporation is unwilling to comply with the applicable provisions of
Section 5.7(a), then the Company, in lieu of compliance with the provisions of
Section 5.7(a), shall have the right, upon written notice to the Holder at least
20 days prior to the occurrence of the Reorganization, to require the Holder to
either (i) exercise this Warrant in full prior to or contemporaneous with the
occurrence of the Reorganization, or (ii) elect to have this Warrant repurchased
pursuant to Section 14.
5.8. Other Action Affecting Common Stock. In case at any time or from time
to time the Company shall take any action in respect of its Common Stock, other
than any action described in this Section 5 for which a specific adjustment is
provided, then, unless such action will not have a materially adverse effect
upon the rights of the Holder, the number of shares of Common Stock
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or other stock for which this Warrant is exercisable and/or the purchase price
thereof shall be adjusted in such manner as may be equitable in the
circumstances.
5.9. Certain Limitations. Notwithstanding anything herein to the contrary,
the Company agrees not to enter into any transaction which, by reason of any
adjustment hereunder, would cause the Current Warrant Price to be less than the
par value per share of Common Stock.
6. NOTICES TO WARRANT HOLDERS
6.1. Notice of Adjustments. Whenever the number of shares of Common Stock
or the class or type of stock or other property for which this Warrant is
exercisable, or whenever the price at which a share of such Common Stock may be
purchased upon exercise of this Warrant, shall be adjusted pursuant to Section
5, the Company shall forthwith prepare a certificate to be executed by the chief
financial officer of the Company setting forth, in reasonable detail, the event
requiring the adjustment and the method by which such adjustment was calculated
(including a description of the basis on which the Board of Directors of the
Company determined the fair value of any evidences of indebtedness, shares of
stock, other securities or property or warrants or other subscription or
purchase rights referred to in Section 5.6(a)), specifying the number of shares
of Common Stock for which this Warrant is exercisable and (if such adjustment
was made pursuant to Section 5.7 or 5.8) describing the number and kind of any
other shares of stock or Other Property for which this Warrant is exercisable,
and any change in the purchase price or prices thereof, after giving effect to
such adjustment or change. The Company shall promptly cause a signed copy of
such certificate to be delivered to the Holder in accordance with Section 19.2.
The Company shall keep at its office or agency designated pursuant to Section 13
copies of all such certificates and cause the same to be available for
inspection at said office during normal business hours by the Holder or any
prospective purchaser of a Warrant designated by the Holder.
6.2. Notice of Certain Corporate Action. The Holder shall be entitled to
the same rights to receive notice of corporate action as any holder of Common
Stock.
7. NO IMPAIRMENT
The Company shall not by any action including, without limitation, amending
its certificate of incorporation or through any 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 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 actions as may
be necessary or appropriate to protect the rights of the Holder against
impairment. Without limiting the generality of the foregoing, the Company will
(a) not increase the par value of any shares of Common Stock receivable upon the
exercise of this Warrant above the Current Warrant Price immediately prior to
such increase in par value, (b) take all such action as may be necessary or
appropriate in order that the Company
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may validly and legally issue fully paid and nonassessable shares of Common
Stock, free and clear of any liens, claims, encumbrances and restrictions (other
than as provided herein) upon the exercise of this Warrant, and (c) use its best
efforts to obtain all such authorizations, exemptions or consents from any
public regulatory body having jurisdiction thereof as may be necessary to enable
the Company to perform its obligations under this Warrant.
Upon the request of the Holder, the Company will at any time during the
period this Warrant is outstanding acknowledge in writing, in form satisfactory
to the Holder, the continuing validity of this Warrant and the obligations of
the Company hereunder.
8. RESERVATION AND AUTHORIZATION OF COMMON STOCK; REGISTRATION WITH OR
APPROVAL OF ANY GOVERNMENTAL AUTHORITY
From and after the Closing Date, subject to the limitation set forth in the
last sentence of this paragraph, the Company shall at all times reserve and keep
available for issue upon the exercise of warrants such number of its authorized
but unissued shares of Common Stock as will be sufficient to permit the exercise
in full of all outstanding Warrants. If at any time the number of authorized but
unissued shares of Common Stock shall not be sufficient to permit the exercise
in full of all outstanding Warrants, the Company will take such corporate action
as may, in the opinion of its counsel, be necessary to increase its authorized
but unissued shares of Common Stock to such number of shares as shall be
sufficient for such purpose, including, without limitation, taking appropriate
board action, recommending such an increase to the holders of Common Stock,
holding shareholders meetings, soliciting votes and proxies in favor of such
increase to obtain the requisite shareholder approval and upon such approval,
the Company shall reserve and keep available such additional shares solely for
the purpose of permitting the exercise of Warrants.
All shares of Common Stock which shall be so issuable, when issued upon
exercise of any Warrant and payment therefor in accordance with the terms of
such Warrant, shall be duly and validly issued, fully paid and nonassessable and
free and clear of any liens, claims and restrictions (other than as provided
herein). Except as provided in this Warrant, no stockholder of the Company has
or shall have any preemptive rights to subscribe for such shares of Common
Stock.
Before taking any action which would result in an adjustment in the number
of shares of Common Stock or the type of consideration for which this Warrant is
exercisable or in the Current Warrant Price, the Company shall obtain all such
authorizations or exemptions thereof, or consents thereto, as may be necessary
from any public regulatory body or bodies having jurisdiction thereof.
If any shares of Common Stock required to be reserved for issuance upon
exercise of Warrants require registration or qualification with any governmental
authority under any federal or state law (otherwise than as provided in Section
10) before such shares may be so issued, the Company will
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in good faith and as expeditiously as possible and at its expense endeavor to
cause such shares to be duly registered.
9. TAKING OF A RECORD; STOCK AND WARRANT TRANSFER BOOKS
In the case of all dividends or other distributions by the Company to the
holders of its Common Stock with respect to which any provision of Section 5
refers to the taking of a record of such holders, the Company will in each such
case take such a record and will take such record as of the close of business on
a Business Day. The Company will not at any time, except upon dissolution,
liquidation or winding up of the Company, close its stock transfer books or
Warrant transfer books so as to result in preventing or delaying the exercise or
transfer of any Warrant.
10. RESTRICTIONS ON TRANSFERABILITY
The Holder shall not Transfer all or any portion of this Warrant or any
shares of the Warrant Stock before satisfaction of the conditions specified in
this Section 10. The Holder, by acceptance of this Warrant, agrees to be bound
by the provisions of this Section 10.
10.1. Restrictive Legends. (a) Except as otherwise provided in this Section
10, each certificate for Warrant Stock initially issued upon the exercise of
this Warrant, and each certificate for Warrant Stock issued to any subsequent
transferee of any such certificate, shall be stamped or otherwise imprinted with
legends in substantially the following form:
"The shares represented by this certificate have not been registered
under the Securities Act of 1933, as amended, or under the securities or
blue sky laws of any state and are subject to the conditions specified in a
certain Warrant dated June 1, 2000, originally issued by SEMX Corporation.
The shares represented by this certificate may not be sold, or otherwise
transferred, in the absence of such registration or an exemption therefrom
under such Act and under any such applicable state laws, or in violation of
the provisions of the Warrant. A copy of the form of said Warrant is on
file with the Secretary of SEMX Corporation. The holder of this
certificate, by acceptance of this certificate, agrees to be bound by the
provisions of such Warrant."
"The shares represented by this certificate are subject to the terms
and conditions of a Registration Rights Agreement, dated as of June 1,
2000."
(b) Except as otherwise provided in this Section 10, each Warrant shall
be stamped or otherwise imprinted with legends in substantially the following
form:
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"This Warrant and the securities represented hereby have not been
registered under the Securities Act of 1933, as amended, or under the
securities or blue sky laws of any state and may not be sold, or otherwise
transferred, in the absence of such registration or an exemption therefrom
under such Act and under any such applicable state laws, or in violation of
the provisions of this Warrant."
"This Warrant and the securities represented hereby are subject to the
terms and conditions of a Registration Rights Agreement, dated as of June
1, 2000."
10.2. Notice of Proposed Transfers; Requests for Registration. Prior to any
Transfer or attempted Transfer of any Warrants or any shares of Restricted
Common Stock, the Holder of such Warrants or Restricted Common Stock shall
deliver to the Company either a written opinion of Independent Counsel, which
opinion shall be reasonably acceptable to the Company, addressed to the Company
or a no-action letter from the Commission to the effect that the proposed
Transfer of such Warrants or such Restricted Common Stock may be effected
without registration under the Securities Act and applicable state securities or
blue sky laws. After delivery of the written opinion or the no-action letter to
the Company, such Holder shall thereupon be entitled to Transfer such Warrants
or such Restricted Common Stock. Each certificate, if any, evidencing such
shares of Restricted Common Stock issued upon such Transfer shall bear the
restrictive legend set forth in Section 10.1(a), and each Warrant issued upon
such Transfer shall bear the restrictive legend set forth in Section 10.1(b),
unless in the written opinion of Independent Counsel addressed to the Company
such legend is not required in order to ensure compliance with the Securities
Act.
10.3. No Transfer to Competitor. Until the termination in accordance with
Section 10.4 of the restrictions on transferability imposed by this Section 10,
the Holder shall not Transfer all or any portion of this Warrant, the Warrant
Stock or the Restricted Common Stock (or Common Stock issuable upon the exercise
of the Warrants) to any Person that the Holder knows, after reasonable inquiry,
is engaged in a business that competes in any material way with the business of
the Company or any of its Subsidiaries (other than a holder of less than 5% of
the public securities of any such Person). In clarification and not in
limitation of the above, the Holder shall be permitted to effect such a Transfer
to such a competitor in connection with the sale of securities (i) in a public
distribution or a public securities transaction, or (ii) pursuant to Rule 144
(or any successor provision to such Rule) under the Securities Act, provided
such Transfer is not a directed sale.
10.4. Termination of Restrictions. Notwithstanding the foregoing provisions
of Section 10, the restrictions imposed by this Section upon the transferability
of the Warrants, the Warrant Stock and the Restricted Common Stock (or Common
Stock issuable upon the exercise of the Warrants) and the legend requirements of
Section 10.1 shall terminate as to any particular Warrant or share of Warrant
Stock or Restricted Common Stock (or Common Stock issuable upon the exercise of
the Warrants) (i) when and so long as such security shall have been effectively
registered
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under the Securities Act and disposed of pursuant thereto, or (ii) when the
Company shall have delivered to the Holder or Holders of Warrants, Warrant Stock
or Restricted Common Stock the written opinion of Independent Counsel stating
that such legend is not required in order to ensure compliance with the
Securities Act. Whenever the restrictions imposed by Section 9 shall terminate
as to this Warrant, as hereinabove provided, the Holder hereof shall be entitled
to receive from the Company, at the expense of the Company, a new Warrant
bearing the following legend in place of the first restrictive legend set forth
hereon:
"THE RESTRICTIONS ON TRANSFERABILITY OF THE WITHIN
WARRANT CONTAINED IN SECTION 10 HEREOF TERMINATED ON
____________, 200__, AND ARE OF NO FURTHER FORCE AND
EFFECT."
All Warrants issued upon registration of Transfer, division or combination
of, or in substitution for, any Warrant or Warrants entitled to bear such legend
shall have a similar legend endorsed thereon. Whenever the restrictions imposed
by this Section shall terminate as to any share of Restricted Common Stock, as
hereinabove provided, the Holder thereof shall be entitled to receive from the
Company, at the Company's expense, a new certificate representing such Common
Stock not bearing the restrictive legend set forth in Section 10.1(a).
11. SUPPLYING INFORMATION
The Company shall cooperate with each Holder of a Warrant and each Holder
of Restricted Common Stock in supplying such information as may be reasonably
requested by such Holder or reasonably necessary for such Holder to complete and
file any information reporting forms presently or hereafter required by the
Commission as a condition to the availability of an exemption from the
Securities Act for the sale of any Warrant or Restricted Common Stock.
12. LOSS OR MUTILATION
Upon receipt by the Company from the Holder of evidence reasonably
satisfactory to it of the ownership of and the loss, theft, destruction or
mutilation of this Warrant and indemnity reasonably satisfactory to it (it being
understood that the written indemnity agreement of ACI Capital America Fund, LP
shall be sufficient indemnity) and in case of mutilation upon surrender and
cancellation hereof, the Company will execute and deliver in lieu hereof a new
Warrant of like tenor to the Holder; provided, in the case of mutilation, no
indemnity shall be required if this warrant in identifiable form is surrendered
to the Company for cancellation.
13. OFFICE OF THE COMPANY
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As long as any of the Warrants remain outstanding, the Company shall
maintain an office or agency (which may be the principal executive offices of
the Company) where the warrants may be presented for exercise, registration of
Transfer, division or combination as provided in this Warrant.
14. BY THE COMPANY OF WARRANTS AND WARRANT STOCK
14.1. Obligation to Repurchase Warrant. (a) If a Change of Control occurs
at any time during the Exercise Period, the Holder at its election by notice to
the Company (the "Put Notice"), may demand repurchase, at any time concurrently
with or within 60 days following the occurrence of such Change in Control, of
the entire unexercised portion of this Warrant, provided that (i) either (A) at
the time of the election under this Section 14.1, the Holder owns all of the
shares of the Underlying Series B Preferred Stock or (B) at the time the Holder
acquired this Warrant, the Holder also acquired all of the Underlying Series B
Preferred Stock and, during the period in which the Holder owned such shares,
such shares were redeemed pursuant to Section 5 of the Series B Certificate of
Designation, and (ii) in the event the Holder, at the time of the election under
this Section 14.1, owns any shares of the Underlying Series B Preferred Stock,
such shares have been or are being redeemed pursuant to Section 5(c) of the
Series B Certificate of Designation prior to or contemporaneously with the
repurchase of this Warrant. Subject to the provisions of Section 14.2, the
Company shall, on the date (not less than 15 days after the date of the Put
Notice) designated in such Put Notice (the "Repurchase Date"), repurchase from
the Holder the entire unexercised portion of this Warrant for an amount
calculated to return to the Holder the total purchase price initially paid to
the Company for the Underlying Series B Preferred Stock by the initial holder
thereof plus a 20% annual internal rate of return (or such lower applicable rate
consented to by the Holder) on said initial purchase price from the first date
of issuance of the Series B Preferred Stock through the Repurchase Date. Such
calculation shall take into account (x) the total cash redemption price received
by the Holder by reason of the redemption of the Holder's shares of the
Underlying Series B Preferred Stock under Section 5 of the Series B Certificate
of Designation, (y) all cash or shares of Other Common Stock (which shares shall
be valued at the average Daily Market Price of such shares for the first 60
consecutive Trading Days following the date of the issuance of such dividend or,
to the extent any such shares were sold during such 60 day period, then such
sold shares shall be valued at the price actually received for such shares)
received by the existing or any former holder of this Warrant as dividends
pursuant to Section 17, and (z) the value of any and all shares of Common Stock
issued to the existing or any former holder of this Warrant by reason of the
exercise of any portion of this or any other Warrant or shares of Other Common
Stock distributed to the existing or any former holder of this Warrant as
dividends pursuant to Section 17 (whether or not any or all of such shares are
owned by the Holder on the Repurchase Date). Such shares of Common Stock that
are not owned by the holder hereof on the date of the Put Notice shall be valued
at a per share price equal to the Current Market Price of such share as of the
date such shares were acquired by exercise of a Warrant. Such shares of Common
Stock that are owned by the holder hereof on the date of the Put Notice shall be
valued at a per share price of the
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Current Market Price of such share as of the Repurchase Date or the date such
shares were acquired by exercise of a Warrant, whichever is greater.
(b) Notwithstanding the provisions of Section 14.1(a), if, at any time
during the period between the date on which the Holder shall have delivered a
Put Notice and the Repurchase Date, a Reorganization shall occur and the
consideration received or receivable by stockholders in connection with such
Reorganization shall consist solely of cash, then the Holder shall (whether or
not the Holder shall have previously surrendered its Warrant for repurchase by
the Company pursuant to this Section 14) be entitled to receive, on the date of
repurchase, the higher of (i) the amount payable to the Holder as determined
pursuant to Section 14.1(a) and (ii) an amount equal to the amount of cash the
Holder would have received upon the occurrence of such Reorganization had the
Holder's Warrant been fully exercised immediately prior thereto less, in the
event of a repurchase of this Warrant, the purchase price payable at such time
for the purchase of the shares of Common Stock then subject to the Holder's
Warrant.
(c) The Company shall not be obligated under this Section 14.1 to
repurchase any Warrant if and to the extent such a repurchase (i) would cause an
event of default to exist by reason of such repurchase, which event of default
has not been waived, with respect to any agreement or instrument evidencing the
Company's or any of its Subsidiaries' indebtedness for borrowed money, or would
violate any provision of any such agreement or instrument, or (ii) would be in
violation of applicable law ("Restrictions"), in any such case as determined by
an opinion of counsel to the Company reasonably acceptable to the Holder;
provided, however, that the Company shall use its reasonable best efforts to
have any such Restriction either waived or terminated (including, without
limitation, by obtaining refinancing for any such indebtedness). In the event
that, following receipt of a Put Notice, the Company will not repurchase such
Warrant because of the existence of any Restriction, the Company shall, within
ten (10) days of receipt of the Put Notice, so notify the Holder in writing,
setting forth that the Warrant will not be repurchased and the Restrictions
which apply, and deliver to the Holder a copy of the opinion referred to in the
prior sentence. In addition, in such event, the Company shall thereafter, upon
the request of the Holder, use its best efforts to register the Warrant Stock
and/or the Common Stock subject to this Warrant, in accordance with the terms of
the Registration Rights Agreement.
14.2. Payment of Repurchase Price. The purchase price for any repurchase
pursuant to Section 14.1 (the "Repurchase Price") shall be determined pursuant
to Section 14.1 and shall be payable in cash.
On the date of any repurchase of Warrants pursuant to this Section 14, the
Holder shall assign to the Company its Warrant, without any representation or
warranty (other than that the Holder has good and marketable title thereto, free
and clear of liens, encumbrances and restrictions of any kind), by the surrender
of the Holder's Warrant at the principal office of the Company referred to in
Section 3.1 against payment therefor of the Repurchase Price by, at the option
of the Holder, (i) wire
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transfer to an account in a bank located in the United States designated by the
Holder for such purpose or (ii) a certified or official bank check payable to
the order of the Holder.
15. REGISTRATION RIGHTS
This Warrant is entitled to the benefits of the registration rights
provisions contained in the Registration Rights Agreement, subject to the
restrictions on the transfer of the rights contained therein set forth in
Section 2(b)(iii) thereof. The Company shall keep a copy of the Registration
Rights Agreement, and any amendments thereto, at the office or agency designated
by the Company pursuant to Section 13 and shall furnish copies thereof to the
Holder upon request.
16. LIMITATION OF LIABILITY
No provision hereof, in the absence of affirmative action by the Holder to
purchase shares of Common Stock, and no enumeration herein of the rights or
privileges of the Holder hereof, shall give rise to any liability of the Holder
for the purchase price of any Common Stock or as a stockholder of the Company,
whether such liability is asserted by the Company or by creditors of the
Company.
17. DIVIDENDS ON UNDERLYING COMMON STOCK
17.1. Right to Receive Dividends. In the event that, at any time the
Company shall pay a dividend or make any other distribution with respect to its
Common Stock whether in the form of cash, Other Common Stock, evidences of
indebtedness, securities or other property, then the Company shall pay to the
Holder of this Warrant on the date of payment of such dividend or other
distribution, an amount in cash or a number of evidences of indebtedness,
securities or other property which a holder of the number of shares of Common
Stock issuable upon exercise of this Warrant in full on the record date for such
dividend or other distribution would be entitled to receive on account of such
dividend or distribution. A reclassification of the Common Stock (other than a
change in par value, or from par value to no par value or from no par value to
par value) into shares of Common Stock and shares of any other class of stock
shall be deemed a distribution by the Company to the holders of its Common Stock
of such shares of such other class of stock within the meaning of this Section
17 and, if the outstanding shares of Common Stock shall be changed into a larger
or smaller number of shares of Common Stock as a part of such reclassification,
such change shall be deemed a subdivision or combination, as the case may be, of
the outstanding shares of Common Stock within the meaning of Section 5.1.
17.2. Repayment of Dividends. (a) In the event the Company at any time
issues dividends to any Holder hereof under Section 17.1 and this Warrant is
never exercised during the Exercise Period, then within 30 days following the
Expiration Date, provided the Company has redeemed the Underlying Series B
Preferred Stock for cash in a timely manner in accordance with the terms of the
Series B
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Certificate of Designation, the final Holder hereof shall pay to the Company an
amount equal to the excess, if any, by which the annual internal rate of return
on the initial purchase price for this Warrant and the Underlying Series B
Preferred Stock from the first date of issuance of the Series B Preferred Stock
through the Expiration Date exceeds 15%. The calculation of said annual rate of
return shall include any shares of Other Common Stock received by the Holder
hereof as a dividend under Section 17.1, which shares shall be valued at the
average Daily Market Price of such shares for the first 60 consecutive Trading
Days following the date of the issuance of such dividend or, to the extent any
such shares were sold during such 60 day period, then such sold shares shall be
valued at the price actually received for such shares. If the Holder becomes
obligated to make a payment to the Company pursuant to this Section 17.2, such
payment may be made in cash and/or by the assignment to the Company of shares of
Other Common Stock valued in accordance with the previous sentence.
(b) In the event a portion, but less than all, of this Warrant is exercised
during the Exercise Period, then the components of the calculation of any
amounts payable to the Company under Section 17.1 shall be appropriately
prorated. For example, if 50% of this Warrant had been exercised, then the
calculation would include 50% of the initial purchase price for this Warrant and
the Underlying Series B Preferred Stock, 50% of the total dividends and
redemption price, if any, paid with respect to the Underlying Series B Preferred
Stock, and 50% of any shares of Other Common Stock received by the Holder hereof
as a dividend under Section 17.1.
(c) Notwithstanding the above, in the event the Company on any fourth (or
more) occasion shall fail to pay any dividend on any Series B Preferred Stock on
the applicable Dividend Payment Date (as defined in the Series B Certificate of
Designation) in accordance with Section 2 of the Series B Certificate of
Designation for any reason, including but not limited to, that such payment is
prohibited by applicable law or any loan document to which the Company is a
party (including without limitation that certain Revolving Credit, Term Loan and
Security Agreement dated November 1, 1999, among PNC Bank, National Association,
the Corporation and certain of the Corporation's affiliates, as the same may be
amended from time to time) or the Board of Directors of the Company elects not
to declare or pay such dividend, and such failure shall not be cured within a
period of 30 days after such Dividend Payment Date, then this Section 17.2
thereafter shall be null and void and of no effect.
(c) Notwithstanding the provisions of this Section 17, the Company
acknowledges that there are certain restrictions on the issuance of dividends
set forth in Section 4(b)(iv) of the Series B Certificate of Designation.
18. RIGHTS PLAN
18.1. Issuance of Rights. Contemporaneous with the issuance of this
Warrant, the Company shall execute all documents and take all actions necessary
to issue to the Holder, pursuant to that certain Rights Agreement dated as of
June 15, 1999, between the Company and Continental Stock Transfer & Trust
Company, Rights Agent (the "Rights Plan"), effective as of the Closing Date, the
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<PAGE>
number of Rights (as defined in the Rights Plan) that would be issued to the
Holder were the Holder to own the total number of shares of Common Stock
issuable to the Holder upon the full exercise of this Warrant, and to assure
that the Holder is entitled to all the rights, privileges and protections of a
holder of Rights under the Rights Plan.
18.2. Return of Rights. In the event that a Triggering Event under the
Rights Plan occurs during the Exercise Period but this Warrant is never
exercised during the Exercise Period, then the Holder's Rights under the Rights
Plan granted pursuant to Section 18.1 shall expire on the Expiration Date. In
the event a portion, but less than all, of this Warrant is exercised during the
Exercise Period, then the Holder's prorated share of the Rights corresponding to
the unexercised portion of this Warrant shall so expire.
19. MISCELLANEOUS
19.1. Nonwaiver and Expenses. No course of dealing or any delay or failure
to exercise any right hereunder on the part of the Holder shall operate as a
waiver of such right or otherwise prejudice the Holder's rights, powers or
remedies. If the Company fails to make, when due, any payments provided for
hereunder, or fails to comply with any other provision of this Warrant, the
Company shall pay to the Holder such amounts as shall be sufficient to cover any
costs and expenses including, but not limited to, reasonable attorneys' fees,
including those of appellate proceedings, incurred by the Holder in collecting
any amounts due pursuant hereto or in otherwise enforcing any of its rights,
powers or remedies hereunder.
19.2. Notice Generally. All notices, demands, requests, or other
communications which may be or are required to be given, served, or sent by any
party to any other party pursuant to this Warrant shall be in writing and shall
be mailed by first-class, registered or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery (including delivery
by courier), or facsimile transmission, addressed as follows:
(a) If to the Company:
SEMX Corporation
1 Labriola Court
Armonk, NY 10504
Attention: Gilbert D. Raker, Chairman, President and CEO
Facsimile: (914) 273-5860
27
<PAGE>
with a copy to:
Joel Salon, Esquire
Salon, Marrow, Dyckman & Newman, LLP
685 Third Avenue
New York, NY 10017
Facsimile: (212) 661-3339
(b) If to the Holder, at its last known address appearing on the books
of the Company maintained for such purpose.
Each party may designate by notice in writing a new address to which any notice,
demand, request or communication may thereafter be so given, served or sent.
Each notice, demand, request or communication shall be deemed to have been duly
given five business days after being deposited in the mail, postage prepaid, if
mailed; when delivered by hand, if personally delivered; or upon receipt, if
sent by facsimile (followed by a confirmation copy sent by either overnight or
two (2) day courier).
19.3. Indemnification. The Company agrees to indemnify and hold harmless
the Holder, its officers, directors, employees, agents, and attorneys from and
against any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, claims, costs, attorneys' fees, expenses and disbursements of
any kind which may be imposed upon, incurred by or asserted against the Holder
relating to or arising out of any litigation to which the Holder is made a party
in its capacity as a stockholder or warrantholder of the Company; provided,
however, that the Company will not be liable hereunder to the extent that any
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, attorneys' fees, expenses or disbursements are found in a
judgment by a court to have resulted from (i) the Holder's gross negligence or
willful misconduct, (ii) actions or omissions taken or not taken by the Holder
in any capacity other than as a stockholder or warrantholder of the Company or
(iii) actions or omissions taken or not taken by the Holder solely as a
stockholder or warrantholder of the Company and for which stockholders or
warrantholders may be held liable under Delaware law.
19.4. Successors and Assigns. Subject to the provisions of Sections 4.1 and
10, (i) this Warrant and the rights evidenced hereby shall inure to the benefit
of and be binding upon the successors of the Company and the successors and
assigns of the Holder, and (ii) the provisions of this Warrant are intended to
be for the benefit of all Holders from time to time of this Warrant, and shall
be enforceable by any such Holder.
19.5. Amendment. The Warrants may be modified or amended or the provisions
thereof waived with the written consent of the Company and the Holder.
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19.6. Severability. Wherever possible, each provision of this Warrant shall
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Warrant shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Warrant.
19.7. Headings. The headings used in this Warrant are for the convenience
of reference only and shall not, for any purpose, be deemed a part of this
Warrant.
19.8. Governing Law. This Warrant shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without giving effect to the
conflict of laws principles thereof.
19.9. Arbitration. Any claim or dispute between the parties hereto arising
out of or in connection with this Warrant or any of the provisions hereof, or
the interpretation, meaning or effect hereof, or the transactions contemplated
hereby, shall be submitted to and determined by arbitration in New York, New
York in accordance with the procedures, rules and regulations of the American
Arbitration Association as in effect at such time. The decision, findings or
award of the arbitrator(s) in the matter shall be final and nonappealable and
binding upon the parties (and their respective successors) with respect to the
subject matter herein concerned, and judgment thereon may be entered in any
court or forum having jurisdiction thereof.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed
by its duly authorized officer and its corporate seal to be impressed hereon and
attested by its Secretary or Assistant Secretary.
Dated: June 1, 2000
SEMX CORPORATION
By: /s/ Gilbert D. Raker
------------------------------
Name: Gilbert D. Raker
Title: Chairman, President and CEO
Attest:
By: /s/ Mark A. Koch
-------------------------
Name: Mark A. Koch
Title: Secretary
<PAGE>
EXHIBIT A
SUBSCRIPTION FORM
[To be executed only upon exercise of Warrant]
The undersigned registered owner of this Warrant irrevocably exercises this
Warrant for the purchase of _______ shares of Common Stock of SEMX Corporation
and herewith makes payment therefor, all at the price and on the terms and
conditions specified in this Warrant and requests that certificates for the
shares of Common Stock hereby purchased (and any securities or other property
issuable upon such exercise) be issued in the name of and delivered to
__________________ whose address is ___________________________ and, if such
shares of Common Stock shall not include all of the shares of Common Stock
issuable as provided in this Warrant, that a new Warrant of like tenor and date
for the balance of the shares of Common Stock issuable hereunder be delivered to
the undersigned.
(Name of Registered Owner)
-----------------------------
(Signature of Registered Owner)
-----------------------------
(Street Address)
-----------------------------
(City) (State) (Zip Code)
-----------------------------
NOTICE: The signature on this subscription must correspond with the name as
written upon the face of the within Warrant in every particular,
without alteration or enlargement or any change whatsoever.
<PAGE>
EXHIBIT B
ASSIGNMENT FORM
FOR VALUE RECEIVED the undersigned registered owner of this Warrant hereby
sells, assigns and transfers unto the Assignee named below all of the rights of
the undersigned under this Warrant, with respect to the number of shares of
Common Stock set forth below:
Name and Address of Assignee No. of Shares of Common Stock
---------------------------- -----------------------------
and does hereby irrevocably constitute and appoint ______________
attorney-in-fact to register such transfer on the books of SEMX Corporation
maintained for the purpose, with full power of substitution in the premises.
Dated:
----------------
Name:
----------------
Signature:
----------------
Witness:
----------------
NOTICE: The signature on this assignment must correspond with the name as
written upon the face of the within Warrant in every particular,
without alteration or enlargement or any change whatsoever.
