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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) OCTOBER 24, 1996
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MICROELECTRONIC PACKAGING, INC.
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(Exact name of registrant as specified in charter)
CALIFORNIA 0-23562 94-3142624
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
9350 TRADE PLACE, SAN DIEGO, CALIFORNIA 92126
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (619) 530-1660
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N/A
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(Former name or former address, if changed since last report.)
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Item 5. Other Events.
On October 24, 1996, Microelectronic Packaging, Inc. ("MPI" or the
"Company") entered into subscription agreements ("Subscription Agreements") with
Dusseldorf Securities Limited ("Dusseldorf") and various other offshore
investors (collectively, the "Purchasers") and Loselle Greenawalt Kaplan Blair &
Adler (as Escrow Agent), the form of which is attached hereto as Exhibit 10.80
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and is incorporated herein by reference. Pursuant to the terms of the
Subscription Agreements, MPI issued a series of convertible debentures to the
Purchasers at an aggregate purchase price of U.S. $2.8 million, which Debentures
have terms of one year and bear interest at the rate of 8.0% per annum. This
offering was not registered under the Securities Act of 1933, as amended,
pursuant to the exemption provided by Regulation S promulgated thereunder.
Accrued and unpaid interest on the Debentures is due and payable in cash in
quarterly installments on the first day of each fiscal quarter of the Company
during the one-year term of the Debentures. The outstanding principal under the
Debentures will be due and payable in full at the end of the one-year term;
however, subject to certain limitations set forth below, from and after 45 days
from October 23, 1996, the outstanding principal under the Debentures may be
converted at each Purchaser's option into shares of the Company's Common Stock.
The number of shares of the Company's Common Stock issuable to the Purchasers
upon such conversion will be the amount of principal outstanding divided by the
lesser of 80% of the average of the closing bid price of the Company's Common
Stock as reported by Nasdaq National Market for the three (3) consecutive
trading days immediately preceding the date of conversion or 110% of the closing
bid price of the Company's Common Stock as reported by Nasdaq National Market on
October 23, 1996. MPI also issued a warrant (the "Warrant") to Dusseldorf to
purchase 75,421 shares of the Company's Common Stock. The exercise price of the
Warrant is the lesser of the average price at which the Debentures are converted
into the Company's Common Stock, or 110% of the closing bid price of the
Company's Common Stock as reported by Nasdaq National Market on October 23,
1996. The Warrant is exercisable into shares of Common Stock commencing forty-
five days after October 23, 1996, and remains exercisable until October 23,
1997. The Debentures may not be converted into shares of Common Stock if such
conversion would result in the issuance by the Company of more than 19.9% of the
Company's outstanding Common Stock as of October 23, 1996, including shares
issued or issuable upon exercise of the Warrant (whether such Warrant has been
exercised or not). The Company is required to redeem all outstanding principal
amounts under the Debentures that cannot be converted (because such conversion
would exceed the 19.9% limit) at 120% of such outstanding principal amount. In
addition, the Company paid Dusseldorf U.S. $322,000 as a placement fee. Under
current Securities and Exchange Commission regulations, such shares of the
Company's Common Stock may be offered and sold in the United States trading
markets at the earliest forty (40) days after the issuance of the Debentures and
the Warrant.
The existence and conversion of the Debentures and the existence and
exercise of the Warrant into shares of the Company's Common Stock will
significantly dilute any earnings per share amounts and significantly dilute the
ownership interests of MPI's shareholders.
For additional information, please see the Company's Press Release
attached hereto as Exhibit 10.83.
Item 7. Financial Statements and Exhibits
(a) Financial Statements of Businesses Acquired. None.
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(b) Pro Forma Financial Information. None.
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(c) Exhibits. The following documents are filed as exhibits to the
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report:
2.
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Exhibit No. Description
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10.80 Form of Offshore Securities Subscription Agreement dated
October 22, 1996 by and among MPI, Purchaser and Loselle
Greenawalt Kaplan Blair & Adler.
10.81 Form of 8% Convertible Debenture issued to the Purchasers.
10.82 Form of Common Stock Purchase Warrant dated October 22, 1995
issued by MPI to Dusseldorf Securities Limited.
10.83 Press Release dated October 28, 1996.
3.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Microelectronic Packaging, Inc.
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(Registrant)
Date: October 28, 1996 By /s/ Denis Trafecanty
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Name: Denis Trafecanty
Title: Chief Financial Officer and Secretary
4.
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Microelectronic Packaging, Inc.
Exhibit Index
to Form 8-K
Exhibit No. Description
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10.80 Form of Offshore Securities Subscription Agreement
dated October 22, 1996 by and among MPI, Purchaser
and Loselle Greenawalt Kaplan Blair & Adler.
10.81 Form of 8% Convertible Debenture issued to
the Purchasers.
10.82 Form of Common Stock Purchase Warrant dated
October 22, 1996 issued by MPI to Dusseldorf
Securities Limited.
10.83 Press Release dated October 28, 1996.
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EXHIBIT 10.80
Form of Offshore Securities Subscription Agreement dated October 22, 1996 by and
among MPI, Purchaser and Loselle Greenawalt Kaplan Blair & Adler.
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OFFSHORE SECURITIES SUBSCRIPTION AGREEMENT
THE CONVERTIBLE DEBENTURES ISSUED AND SOLD PURSUANT TO THIS SUBSCRIPTION
AGREEMENT AND THE SHARES OF COMMON STOCK UNDERLYING SUCH INSTRUMENTS HAVE NOT
BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT") OR UNDER THE LAWS OF ANY OTHER JURISDICTION, IN RELIANCE UPON REGULATION
S UNDER THE ACT. UNTIL THE FORTY-FIFTH (45/TH/) DAY AFTER THE SALE OF THE
CONVERTIBLE DEBENTURES, THE WARRANT AND THE SHARES OF COMMON STOCK UNDERLYING
EACH PURSUANT TO REGULATION S IS COMPLETED, NO CONVERTIBLE DEBENTURE, WARRANT OR
SHARES UNDERLYING SUCH SECURITIES MAY BE OFFERED, SOLD OR TRANSFERRED (INCLUDING
ANY INTERESTS THEREIN) IN THE UNITED STATES OR TO A "U.S. PERSON" (AS DEFINED IN
REGULATION S PROMULGATED UNDER THE ACT) OR FOR THE ACCOUNT OR BENEFIT OF ANY
U.S. PERSON, EXCEPT AS PROVIDED IN SAID REGULATION S. ANY RESALE THEREAFTER
MUST BE PURSUANT TO REGISTRATION UNDER THE ACT OR AN AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE ACT. NEITHER MICROELECTRONIC PACKAGING,
INC. ("MPI") NOR ITS TRANSFER AGENT SHALL BE OBLIGATED TO REMOVE ANY LEGEND ON
CERTIFICATES REPRESENTING SUCH SECURITIES UNLESS IT SHALL HAVE RECEIVED AN
OPINION OF COUNSEL TO THE HOLDER OF THE CONVERTIBLE DEBENTURE, THE WARRANT OR
THE SHARES OF COMMON STOCK UNDERLYING SUCH SECURITIES REASONABLY SATISFACTORY TO
MPI AND ITS TRANSFER AGENT STATING THAT SUCH REMOVAL COMPLIES WITH THE
REQUIREMENTS OF REGULATION S.
THIS AGREEMENT is made as of the __ day of October, 1996, by and among
Microelectronic Packaging, Inc., a California corporation (the "Company"),
_________________________________ (the "Purchaser"), a corporation organized
under the laws of ____________________ and Loselle Greenawalt Kaplan Blair &
Adler ("Escrow Agent"). Unless otherwise defined herein, capitalized terms used
herein and not otherwise defined shall have the meanings given to them in
Regulation S ("Regulation S") promulgated under the Act.
WITNESSETH:
WHEREAS, in reliance upon the respective representations and warranties of
the Company and Purchaser, and the terms and conditions hereinafter set forth,
the Purchaser desires to acquire, and the Company desires to issue, $___________
principal amount of the Company's 8% Convertible Debentures due October ____,
1997 convertible into shares of common stock of the Company, no par value
("Common Stock"), at a conversion price and on such terms as set forth in
Exhibit "A" (the "Debentures") at a purchase price of U.S.___________ (U.S.
$_______) (the "Purchase Price"); and
WHEREAS Dusseldorf Securities Limited ("Dusseldorf"), one of the investors
will be issued, in exchange for certain placement services provided by Purchaser
to the Company, a warrant (the "Warrant") to purchase 75,421 shares of the
Company's Common Stock exercisable from forty-five (45) days after the date
hereof to one (1) year after the date hereof at an exercise price and on such
terms as set forth in Exhibit "B". The shares of Company Common Stock issuable
upon conversion of the Debentures or upon exercise of the Warrant are referred
to herein as the "Shares."
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NOW, THEREFORE, in consideration of the premises and the respective
covenants hereinafter set forth, the Company, Purchaser and Escrow Agent hereby
agree as follows:
1. SALE AND PURCHASE OF SECURITIES.
1.1 The Company agrees to sell to Purchaser and Purchaser hereby agrees to
purchase from the Company the Debentures set forth above. Such sale and
purchase shall take place upon payment of the Purchase Price for the Debentures
by electronic transfer of immediately available funds to the Escrow Agent as
follows:
Name of Account: Loselle Greenawalt Kaplan Blair & Adler, IOLA Account,
Bank: Chase Manhattan Bank
ABA No. 021-000021
Account No. 128074204665.
The Company hereby acknowledges that it has been advised by the Escrow
Agent that the Escrow Agent is representing Dusseldorf in the transaction
contemplated by this Agreement but is acting herein solely as an Escrow Agent.
1.2 At the closing (the "Closing"), the Company shall deliver the
Debentures and the Warrant to the Escrow Agent. Upon delivery of the Debentures
and Warrant, immediately available funds representing the Purchase Price shall
be wire transferred by the Escrow Agent to a bank account or bank accounts
specified by the Company. The Escrow Agent shall then deliver the Debentures to
the Purchaser in accordance with the Purchaser's instructions and the Warrant to
Dusseldorf in accordance with Dusseldorf's instructions.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY.
To the Company's knowledge, which for purposes of this Section 2. shall
include all of its subsidiaries on a consolidated basis, except as set forth in
the attached Schedule of Exceptions, the Company hereby represents, warrants and
covenants to Purchaser that as of the date hereof and at the Closing:
2.1 The Company has been duly organized, is validly existing and is in
good standing under the laws of the State of California.
2.2 The Company has full corporate right, power and authority to enter
into this Agreement, perform its obligations hereunder and to sell the
Debentures to the Purchaser.
2.3 Except as otherwise set forth herein or as otherwise disclosed in
writing and in the Company's public filings under the Act and the Securities
Exchange Act of 1934, as amended (the
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"Exchange Act") (collectively the "Disclosure Documents"), the Company knows of
no fact or circumstance with respect to the Company, its officers or directors
that is reasonably likely to have a material adverse effect on its operations,
properties, assets, or condition, financial or otherwise.
2.4 The Company's common stock is registered pursuant to Section 12(b) of
the Exchange Act.
2.5 The Company is, to the best of its knowledge and belief, in compliance
in all material respects with all applicable laws and regulations of federal,
state and local government agencies having jurisdiction over it other than non-
compliance that would not have a material adverse effect on the Company.
2.6 If the Debentures are converted into Shares, the Shares, when issued,
will be duly authorized, validly issued, fully paid and non-assessable. Upon
delivery to Purchaser of the Shares pursuant to the provisions of this
Agreement, Purchaser will acquire valid title in said Shares, free and clear of
all liens, encumbrances, restrictions, claims and commitments of every kind,
except for restrictions arising under federal, state, local and foreign
securities laws or as set forth in this Agreement and the Debenture.
2.7 Neither the execution or delivery of this Agreement nor the
performance by the Company of the transactions contemplated herein violates any
provision of law applicable to the Company or conflicts with or will result in a
breach or termination of any provision of, or constitutes a default, or will
result in the creation of any lien, charge or encumbrance upon any of the
property or assets of the Company under the Company's Articles of Incorporation
(subject to the total authorized number of shares of Common Stock therein and
any increase in such authorized number as may be necessary to provide for the
conversion of the Debentures) or By-Laws, mortgage, deed of trust, indenture or
other material agreement or instrument, or any order, judgment, decree, statute,
regulation or any other restriction of any governmental authority to which the
Company is a party or by which any of the assets of the Company may be bound
with or without the giving of notice, the passage of time or both, except with
respect to applicable laws affecting creditors' rights.
2.8 (i) The Company is a Reporting Issuer. The Company is in full
compliance, to the extent applicable, with all reporting obligations under
Section 13(a) or 15(d) of the Exchange Act.
(ii) The Company has not offered the Debentures or the Shares to any
person in the United States or to any identifiable groups of U.S. citizens
abroad or to any U.S. Person.
(iii) In regard to this transaction, the Company has not, nor to its
knowledge has any affiliate or person acting on behalf of itself or the Company,
conducted any Directed Selling Efforts in the United States nor has the Company
conducted any
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general solicitation relating to the offer and sale of the Debentures or the
Shares to persons resident within the United States or elsewhere.
(iv) The Company will not offer to sell any other securities of the
Company in connection with this offering other than debentures, shares and the
warrant that are being sold substantially concurrently herewith.
(v) The sale of the Debentures and the Shares are not part of a plan
or scheme to evade the registration requirements of the Act. The Company
believes that the Purchase Price is reasonable after consideration of the
applicable restricted period under Regulation S, the historical volatility of
the market price of the Common Stock of the Company, the current financial
condition of the Company, the dilution represented by the sale of the
Debentures, the Warrant, the Shares and any other sales of debentures, warrant
or shares of the Common Stock of the Company occurring concurrently herewith,
current stock market conditions and other relevant information concerning the
Company.
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF PURCHASER.
The Purchaser hereby represents, warrants and covenants to the Company that
as of the date hereof and at the Closing:
3.1 It understands and acknowledges that the Debentures and the Shares
acquired pursuant to this Agreement have not been and will not be registered
under the Act, and are being sold in reliance upon an exemption from
registration afforded by Regulation S promulgated under the Act; and that the
Debentures and the Shares have not been registered with, passed on, reviewed or
recommended by any state or foreign securities commission or authority. The
Purchaser: (i) will not, during the applicable restricted period under
Regulation S (the "Restricted Period"), offer, sell, pledge or otherwise
transfer the Debentures or the Shares (or create or maintain any derivative
position equivalent thereto) in the United States, or to a U.S. Person or for
the account or benefit of a U.S. Person; (ii) will, during the Restricted
Period, offer, sell, pledge or otherwise transfer the Debentures or the Shares
only in accordance with Rules 903 or 904 of Regulation S under the Act, pursuant
to registration under the Act or pursuant to another available exemption from
the registration requirements of the Act (and based upon an opinion of counsel
to such Purchaser which is reasonably satisfactory to the Company), and in
accordance with all applicable federal, state and foreign securities laws; and
(iii) will, after the expiration of the Restricted Period, offer, sell, pledge
or otherwise transfer the Debentures and the Shares (or create or maintain any
derivative position equivalent thereto) only pursuant to registration under the
Act or an available exemption therefrom (and based upon an opinion of counsel to
such Purchaser which is reasonably satisfactory to the Company) and, in any
case, in accordance with all applicable federal, state and foreign securities
laws. The Company will not honor or register and will not be obligated to honor
or register any transfer in violation of
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these provisions.
3.2 (i) It is not a U.S. Person and is not acquiring the Debentures or
the Shares for the account or benefit of any U.S. Person; (ii) if a corporation,
it is not organized or incorporated under the laws of the United States; (iii)
if a corporation, no director or executive officer is a national or citizen of
the United States; and (iv) it is not otherwise deemed to be a U.S. Person.
3.3 It was not formed specifically for the purpose of acquiring the
Debentures or the Shares purchased pursuant to this Agreement. At the time the
offer and buy orders for the Debentures were originated, including, without
limitation, at the time Purchaser executed and delivered this Agreement and
otherwise subscribed for or agreed to purchase the Debentures, Purchaser was
located outside the United States. The transactions contemplated by this
Agreement have not been pre-arranged with a buyer located in the United States
or with a U.S. Person, and are not part of a plan or scheme on the part of
Purchaser, any of its affiliates or any person acting on its or their behalf, to
evade the registration requirements of the Act.
3.4 It acknowledges that it has, either alone and/or through its agents,
been afforded access to all material information concerning the Company and has
received responses to all questions specifically posed to the Company relevant
to Purchaser's decision to acquire the Debentures and the Shares. Without
limiting the foregoing, it has alone and/or through its agents, had adequate
opportunity to ask questions of and receive answers from, responsible officers
and/or directors of the Company and to conduct any other investigation it deems
necessary and appropriate concerning the acquisition of the Debentures and the
Shares. Except as set forth herein, the Company has made no representations or
warranties to Purchaser which have induced, persuaded or stimulated it to
subscribe for and acquire the Debentures and Shares hereunder.
3.5 It has received, or the Company has made available, copies of the
following documents (the "Disclosure Documents"): The Company's Form 10-K for
the year ended December 31, 1995 as filed with the Securities and Exchange
Commission, the Proxy Statement for Annual Meeting of Shareholders dated May 29,
1996 and its quarterly report on Form 10-Q for the quarter ended June 30, 1996
and the Company has made available to the Purchaser all other public documents
filed with the Commission.
3.6 It acknowledges that the Company is relying upon the truth and
accuracy of the representations, warranties and covenants of Purchaser made
herein in selling the Debentures and the Shares hereunder without registration
and in reliance upon Regulation S promulgated under the Act. It is familiar
with Regulation S and has consulted with legal counsel familiar with Regulation
S in connection with this transaction.
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3.7 Purchaser has been duly organized, is validly existing and is in good
standing under the laws of the jurisdiction set forth above, was not formed for
the express purpose of acquiring the Debentures or the Shares, and if a
corporation, all corporate action on its part, necessary for the authorization,
execution, delivery and performance of Purchaser's obligations under this
Agreement has been or shall be taken prior to the closing of this transaction,
and this Agreement, when executed and delivered, shall constitute a valid and
legally binding obligation of the Purchaser enforceable against Purchaser in
accordance with its terms.
3.8 It is purchasing the Debentures and the Shares for its own account,
not with a view to any distribution thereof and not for the account or benefit
of a U.S. Person, and no other person has any interest in or participation in
the Debentures and the Shares or any right, option, security interest, pledge or
other interest in or to the Debentures or the Shares. It understands,
acknowledges and agrees it must bear the economic risk of its investment in the
Debentures and the Shares for an indefinite period of time and that prior to any
offer or sale of such securities, the Company may require, as a condition to
effecting a transfer of the Debentures or the Shares, an opinion of counsel to
Purchaser, acceptable to the Company, as to the registration or exemption
therefrom under the Act. It also understands that the Company is under no
obligation to register the Debentures or Shares on behalf of Purchaser or to
assist it in complying with any exemption from registration except as provided
herein.
3.9 Neither the Purchaser nor any affiliate of the Purchaser or any person
acting on its or their behalf, has made or is aware of any or will make any
Directed Selling Efforts in the United States or any activity undertaken for the
purpose of, or that could reasonably be expected to have the effect of,
conditioning the market in the United States for any of the securities being
purchased hereby. Purchaser and its affiliates and agents have complied and
will comply with the Offering Restrictions requirements of Regulation S in
making offers and sales of the Debentures or Shares.
3.10 Except as set forth in the Agreement or otherwise in writing, no
representations or warranties have been made to the Purchaser by the Company,
the officers or directors of the Company, or any agent, employee or affiliate of
any of them, and in entering into this transaction the Purchaser is not relying
upon any other information other than the results of its own independent
investigation. The Purchaser, in making its decision to purchase the Debentures
and the Shares has relied upon independent investigations made by it and has not
relied on any information or representations made by third parties and the
Purchaser believes that the Purchase Price is reasonably related to the
Restricted Period, the historical volatility of the market price of the Common
Stock of the Company, the current financial condition of the Company, the
dilution represented by the sale of the Debentures, the Warrant, the Shares and
any other sales of debentures, warrants or shares of the Common Stock of the
Company occurring concurrently
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herewith, current stock market conditions and other relevant information
concerning the Company. The Purchaser acknowledges that it is a sophisticated
investor, that it has invested in other Regulation S transactions by other
issuers, and that an investment in the Debentures and the Shares involves a high
degree of risk.
3.11 If the Purchaser is a corporation or trust or other entity, the
officer or trustee or other person executing this Agreement represents and
warrants that he or she is duly authorized to so sign this Agreement and to
consummate the transactions contemplated hereby and that Purchaser is authorized
by its governing documents to make this investment. Purchaser has such knowledge
and experience in financial and business matters that it is capable of
evaluating the merits and risks of an investment in the Debentures and the
Shares, and it is able to bear the economic risk of losing up to the entire
amount of its investment therein.
3.12 It consents to the Company placing an appropriate stop transfer order
against the certificate(s) representing the Debentures or the Shares underlying
the Debentures and acknowledges that such certificate(s) will bear legends in
substantially the following form:
THIS CONVERTIBLE DEBENTURE AND THE UNDERLYING SHARES OF COMMON STOCK
HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "ACT") OR UNDER THE LAWS OF ANY OTHER
JURISDICTION, IN RELIANCE UPON REGULATION S UNDER THE ACT. UNTIL THE
FORTY-FIFTH (45TH) DAY AFTER THE SALE OF THIS CONVERTIBLE DEBENTURE
PURSUANT TO REGULATION S IS COMPLETED, NO CONVERTIBLE DEBENTURE OR
UNDERLYING SHARES MAY BE OFFERED, SOLD OR TRANSFERRED (INCLUDING ANY
INTERESTS THEREIN) IN THE UNITED STATES OR TO A "U.S. PERSON" (AS
DEFINED IN REGULATION S PROMULGATED UNDER THE ACT) OR FOR THE ACCOUNT
OR BENEFIT OF ANY U.S. PERSON, EXCEPT AS PROVIDED IN SAID REGULATION
S. ANY RESALE THEREAFTER MUST BE PURSUANT TO REGISTRATION UNDER THE
ACT OR AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE ACT. NEITHER MICROELECTRONIC PACKAGING, INC. ("MPI") NOR ITS
TRANSFER AGENT SHALL BE OBLIGATED TO REMOVE THIS LEGEND UNLESS IT
SHALL HAVE RECEIVED AN OPINION OF COUNSEL TO THE HOLDER HEREBY
REASONABLY SATISFACTORY TO MPI AND ITS TRANSFER AGENT STATING THAT
SUCH REMOVAL COMPLIES WITH THE REQUIREMENTS OF REGULATION S.
3.13 Neither the Purchaser nor any of its affiliates directly or
indirectly have within the past ninety (90) days nor will such persons for a
period of 45 days from the Closing directly or indirectly enter into any short
selling of any equity security of the Company (including, without limitation,
the Common Stock) or any hedging transaction with respect to any equity security
of the Company, including without limitation, puts, calls, or other option
transactions, option writing and equity swaps.
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4. APPOINTMENT OF ESCROW AGENT.
4.1 The Company and Purchaser hereby appoint the Escrow Agent and the
Escrow Agent hereby accepts its appointment as Escrow Agent pursuant to the
terms and conditions hereinafter set forth.
4.2 The Company shall issue the Debentures and the Warrant with the
appropriate Regulation S legend thereon, in the name of the Purchaser, and
deliver the Debentures and the Warrant to the Escrow Agent. Escrow Agent shall
hold the Debentures and the Warrant until it receives, by wire transfer as
hereinbefore set forth, the Purchase Price. Upon receipt of the Purchase Price,
Escrow Agent shall disburse the Purchase Price in accordance with instructions
it receives from the Company. Escrow Agent shall simultaneously therewith,
deliver the Debentures to the Purchaser pursuant to the Purchaser's instructions
and the Warrant to Dusseldorf.
4.3 It is understood and agreed by the parties to this Agreement as
follows:
(a) The Escrow Agent is not and shall not be deemed to be a trustee
for any party for any purpose and is merely acting as a depository and in a
ministerial capacity hereunder with the limited duties herein prescribed.
(b) The Escrow Agent does not have and shall not be deemed to have
any responsibility in respect of any instruction, certificate or notice
delivered to it other than faithfully to carry out the obligations undertaken in
this Agreement and to follow the directions in such instruction or notice
provided in accordance with the terms hereof.
(c) The Escrow Agent is not and shall not be deemed to be liable for
any action taken or omitted by it in good faith and may rely upon, and act in
accordance with, the advice of its counsel without liability on its part for any
action taken or omitted in accordance with such advice. In any event, its
liability hereunder shall be limited to liability for gross negligence, willful
misconduct or bad faith on its part.
(d) The Escrow Agent may conclusively rely upon and act in accordance
with any certificate, instruction notice, letter, telegram, cablegram or other
written instrument believed by it to be genuine and signed by the Company and
Purchaser.
(e) The Company and Purchaser agree to hold harmless, indemnify and
defend the Escrow Agent for, from and against any loss, damage, liability,
judgment, cost and expense whatsoever, including attorney's fees, suffered or
incurred by it by reason of, or on account of, any misrepresentation made to it
or as to its status or activities as Escrow Agent under this Agreement except
for any loss, damage, liability, judgment, cost or expense resulting from gross
negligence, willful misconduct or bad faith on the part of the Escrow Agent.
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(f) The Escrow Agent shall not be required to defend any legal
proceeding which may be instituted against it in respect of the subject matter
of this Agreement. If any such legal proceeding is instituted against it, the
Escrow Agent agrees promptly to give notice of such proceeding to the Company
and Purchaser. The Escrow Agent shall not be required to institute legal
proceedings of any kind.
(g) The Escrow Agent shall not, by act, delay, omission or otherwise,
be deemed to have waived any right or remedy it may have either under this
Agreement or generally, unless such waiver be in writing, and no waiver shall be
valid unless it is in writing, signed by the Escrow Agent, and only to the
extent expressly therein set forth. A waiver by the Escrow Agent under the
terms of this Agreement shall not be construed as a bar to, or waiver of, the
same or any other such right or remedy which it would otherwise have on any
other occasion.
(h) The Escrow Agent may refrain from taking any action other than
keeping all property held by it in escrow if it is uncertain concerning its
duties or rights under this Escrow Agreement or receives claims or demands from
any person or entity or receives a final judgment by a court of competent
jurisdiction if it deems that necessary or advisable.
5. MISCELLANEOUS.
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5.1 This Agreement supersedes the letter of intent between the Company and
Dusseldorf dated as of October 2, 1996. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties hereto. Nothing in this Agreement,
express or implied is intended to confer upon any party, other than the parties
hereto, and their respective successors and assigns, any rights, remedies,
obligations or liabilities under or by reason of this Agreement, except as
expressly provided herein.
5.2 Any notice under the provisions of this Agreement shall be given in
writing and delivered by hand, overnight courier or messenger service, against
signed receipt or acknowledgment of receipt, or by registered or certified mail,
return receipt requested, or telecopier or similar means of communication if
receipt is confirmed or if transmission is confirmed by mail as provided in this
paragraph 5.2, to the Purchaser at its address and/or its telecopier number set
forth on the signature page hereof, or to the Company at its address and/or its
telecopier number set forth on the signature page hereof, or to the Escrow Agent
at its address and/or its telecopier number set forth on the signature page
hereof. Any party may, by like notice, change the address to which notice
should be given. This Agreement and the Debentures may be executed by the
parties hereto by exchange of signatures by telecopier or similar means in the
manner provided herein.
5.3 This Agreement shall be governed by and construed in
9
<PAGE>
accordance with the laws of the State of California.
5.4 This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
5.5 The warranties and representations of the Company and the Purchaser
contained in or made pursuant to this Agreement shall survive the execution and
delivery of this Agreement and the closing hereunder.
5.6 The Company agrees to compensate Dusseldorf for placement services in
connection with the transactions contemplated hereby by (i) issuing the Warrant
to Dusseldorf; and (ii) paying a cash fee equal to 11.5% of the Purchase Price
($322,000), such cash fee to be paid out of the escrow at closing.
5.7 The Company represents and warrants that it is not at present engaged
in any new discussion or negotiation with respect to the sale or placement of
any of the Company's equity securities pursuant to Regulation S or D and will
not sell or place any of its equity securities pursuant to Regulation S or
Regulation D at a discount to the market price of the Company's Common Stock as
quoted by NASDAQ with any party other than Purchaser until Dusseldorf has
converted all of its Debentures to Common Stock or March 31, 1997, whichever
first occurs, unless agreed to otherwise by Dusseldorf.
5.8 In the event that the Securities and Exchange Commission amends
Regulation S under the Act to increase the 40-day restricted period under
Regulation S (the "Amendment"), the Amendment is effective within 45 days of the
date hereof, and the Amendment extends the holding period applicable to the
Shares underlying the Debentures held by the Purchaser then, upon receipt of a
written request by the Company from the Purchaser to effect registration of the
Shares, the Company shall, subject to the limitations set forth below, within
sixty (60) days, use reasonable efforts to file a registration statement
covering all Shares that the Purchaser has requested to be registered. The
Company shall not be obligated to effect, or take any action to effect, any such
registration under this section 5.8 if (i) in the good faith judgment of the
Board of Directors of the Company such registration would adversely affect the
Company and the Board of Directors concludes, as a result, that it is essential
to defer the filing of such registration statement at such time, and (ii) the
Company shall furnish to the Purchaser a certificate signed by the President or
the Chief Executive Officer of the Company stating that in the good faith
judgment of the Board of Directors of the Company, it would adversely affect the
Company for such registration statement to be filed in the near future and that
it is, therefore, essential to defer the filing of such registration statement,
then the Company shall have the right to defer such filing for the period during
which such filing would adversely affect the Company, provided that the Company
may not defer the filing for a period of more than one hundred and eighty (180)
days after the receipt of the request by the Purchaser. The
10
<PAGE>
registration statement filed pursuant to the request of the Purchaser may
include other securities of the Company, with respect to which registration
rights have been granted, and may include securities of the Company being sold
for the account of the Company. In addition, the Company shall not be obligated
to effect, or to take any action to effect, any such registration during the
period starting with the date sixty (60) days prior to the Company's good faith
estimate of the date of filing of, and ending on a date one hundred twenty (120)
days after the effective date of, a registration statement otherwise filed by
the Company covering shares newly issued by the Company or held by selling
shareholders, or both; provided that the Company is actively employing in good
faith all reasonable efforts to cause such prior registration statement to
become effective.
5.9 Except as herein provided, any provision of this Agreement may be
amended or waived by a written instrument signed by the parties hereto.
11
<PAGE>
IN WITNESS WHEREOF, the undersigned have hereunto set their hands and seals
as of the date and year first written above.
Country in which this Agreement is executed by Purchaser: ____________
By: _____________________________________
(Purchaser)
Telecopier No.: _________________________
Microelectronic Packaging, Inc.
By: _____________________________________
(Company)
Telecopier No: (619) 530-1661
_________________________________________
Loselle Greenawalt Kaplan
Blair & Adler
By: _____________________________________
(Escrow Agent)
Telecopier No: (212) 986-6852
12
<PAGE>
EXHIBIT 10.81
Form of 8% Convertible Debenture issued to the Purchasers.
<PAGE>
THIS CONVERTIBLE DEBENTURE AND THE UNDERLYING SHARES OF COMMON STOCTHIS
CONVERTIBLE DEBENTURE AND THE UNDERLYING SHARES OF COMMON STOCK HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT") OR UNDER THE LAWS OF ANY OTHER JURISDICTION, IN RELIANCE UPON REGULATION
S UNDER THE ACT. UNTIL THE FORTY-FIFTH (45/TH/) DAY AFTER THE SALE OF THIS
CONVERTIBLE DEBENTURE PURSUANT TO REGULATION S IS COMPLETED, NO CONVERTIBLE
DEBENTURE OR UNDERLYING SHARES MAY BE OFFERED, SOLD OR TRANSFERRED (INCLUDING
ANY INTERESTS THEREIN) IN THE UNITED STATES OR TO A "U.S. PERSON" (AS DEFINED IN
REGULATION S PROMULGATED UNDER THE ACT) OR FOR THE ACCOUNT OR BENEFIT OF ANY
U.S. PERSON, EXCEPT AS PROVIDED IN SAID REGULATION S. ANY RESALE THEREAFTER MUST
BE PURSUANT TO REGISTRATION UNDER THE ACT OR AN AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE ACT. NEITHER MICROELECTRONIC PACKAGING, INC.
("MPI") NOR ITS TRANSFER AGENT SHALL BE OBLIGATED TO REMOVE THIS LEGEND UNLESS
IT SHALL HAVE RECEIVED AN OPINION OF COUNSEL TO HOLDER REASONABLY SATISFACTORY
TO MPI AND ITS TRANSFER AGENT STATING THAT SUCH REMOVAL COMPLIES WITH THE
REQUIREMENTS OF REGULATION S.
MICROELECTRONIC PACKAGING, INC.
a California corporation
8% Convertible Debenture due October 23, 1997
Total Debenture: $2,800,000.00 U.S.
Debenture ____ of 56
Amount of this Debenture: $50,000.00 U.S.
Dated October 23, 1996
Microelectronic Packaging, Inc., a California corporation (the
"Corporation"), is indebted and, for value received, promises to pay (subject to
the conversion provisions set forth herein) to the order of ____________________
_______________________________________________________________________________
______________________________________________________________ (or its Nominee),
on October 23, 1997 (the "Due Date"), upon presentation of this Convertible
Debenture, fifty thousand dollars ($50,000.00) (the "Principal Amount") and to
pay interest on the Principal Amount at the rate of 8% per annum as provided
herein.
The Corporation covenants, promises and agrees as follows:
1. Interest. Interest which shall accrue on the outstanding Principal
Amount shall be payable in four quarterly installments on the first day of each
fiscal quarter of the Corporation beginning on the first day of the fiscal
quarter following the fiscal quarter in which payment of the Principal Amount is
made to the Corporation. Interest for the first such fiscal quarter shall be
pro rata for the number of days of the first fiscal quarter after payment of the
Principal Amount is made to the Corporation. Interest shall be payable in cash.
All payments of principal and interest or principal or interest shall be made at
the above stated address, or at such other place as may be designated in writing
by the holder hereof.
2. Conversion.
Exhibit "A"
<PAGE>
2.1 The holder of this Debenture shall have the right, at such holder's
option, at any time, commencing after 45 days from the date hereof to convert
all or part of the principal of this Debenture into such number of fully paid
and nonassessable shares of Common Stock of the Corporation as shall be provided
herein.
2.2 The holder of this Debenture may exercise the conversion right
provided in this Section 2 by giving written notice in the form attached hereto
(the "Conversion Notice") to the Corporation of the exercise of such right, in
whole or in part, and stating the name or names in which the stock certificate
or stock certificates for the shares of Common Stock are to be issued and the
address to which such certificates shall be delivered. The Conversion Notice
shall be accompanied by the Debenture. The number of shares of Common Stock
that shall be issuable upon conversion of the Debenture shall equal the amount
of the outstanding principal for which a Conversion Notice is given, divided by
a conversion price (the "Conversion Price") equal to the lesser of (x) --- [110
% of the closing bid price of the Common Stock on the closing date] or (y) 80%
of the average closing bid price of the Common Stock as reported by NASDAQ for
the three (3) consecutive trading days immediately preceding the Date of
Conversion (as defined below), subject to adjustment as provided in Section 4.
Notwithstanding anything to the contrary contained herein or in that certain
Offshore Securities Subscription Agreement among the Corporation, the Purchasers
identified therein and Loselle Greenawalt Kaplan Blair & Adler dated as of
October 22, 1996, in no event shall the holder of this Debenture exercise the
conversion right provided in this Section 2 to the extent that (i) the number of
shares of Common Stock issuable to such holder pursuant to such conversion and
to any other holder simultaneously converting a Debenture issued as part of the
same series as this Debenture, plus (ii) the number of shares of Common Stock
previously issued to such holder and any other holder of Debentures issued as
part of the same series as this Debenture pursuant to any previous conversion
plus (iii) the total number of shares of Common Stock issuable pursuant to that
certain Warrant issued by the Corporation to Dusseldorf Securities Limited dated
as of the date hereof (whether or not such shares have then been issued), would
equal or exceed 1,112,628 shares of Corporation Common Stock. In the event
that, due to the operation of the immediately preceding sentence, the holder
hereof is unable to convert some portion of the principal due under this
Debenture (the "Outstanding Balance"), the Corporation shall, within 15 days of
the date it receives the Conversion Notice, redeem such Outstanding Balance by
payment to the holder of cash in an amount equal to 120% of the Outstanding
Balance. In the event that more than one (1) holder of Debentures issued in this
series elects to convert one or more Debentures on the same day and the
aggregate amount to be converted by such holders cannot be so converted due to
the provisions set forth above, the aggregate amount that may be converted shall
be apportioned between or among such holders in the same proportion as the
amount to be converted by each holder bears to the total amount to be so
converted.
2.3 Mechanics of Conversion. No fractional shares of Common Stock shall
be issued upon conversion of this Debenture. In lieu of any fractional shares
to which the holder would otherwise be entitled, the Corporation shall round up
to the nearest whole share. In the case of a dispute as to the calculation of
the Conversion Price, the Corporation's calculation shall be deemed conclusive
absent manifest error. In order to convert this Debenture into full shares of
Common Stock, the holder shall surrender this Debenture, duly endorsed, by
overnight courier
DEBENTURE-MICROELECTRONIC PACKAGING REV.
<PAGE>
to the Corporation, together with the Conversion Notice that it elects to
convert the same, the amount of principal to be so converted, and a calculation
of the Conversion Price (with an advance copy of the Debenture(s) and the notice
by facsimile); provided, however, that the Corporation shall not be obligated to
issue certificates evidencing the shares of Common Stock issuable upon such
conversion unless either the Debenture is delivered to the Corporation as
provided above, or the holder notifies the Corporation that such Debenture has
been lost, stolen or destroyed and executes an agreement satisfactory to the
Corporation to indemnify the Corporation from any loss incurred by it in
connection with such Debenture.
Within one (1) business day of receiving a properly submitted Conversion
Notice, the Corporation shall instruct American Stock Transfer & Trust Company
(the "Transfer Agent") to issue and deliver as promptly as practicable to such
holder at the address of the holder on the debenture records of the Corporation,
a certificate or certificates for the number of shares of Common Stock to which
it shall be entitled (subject to the delivery of the original Debenture to the
Corporation). In the absence of an opinion of counsel to the holder reasonably
acceptable to the Corporation indicating that the securities underlying this
Debenture may be issued without restrictive legends pursuant to an exemption
from the Act, the certificate or certificates representing such underlying
securities shall bear a legend substantially similar to that set forth on this
Debenture. The date on which notice of conversion is given (the "Date of
Conversion") shall be deemed to be the date set forth in such notice of
conversion provided that the original Debenture to be converted is received by
the Corporation within five business days thereafter and the person or persons
entitled to receive the shares of Common Stock issuable upon such conversion
shall be treated for all purposes as the record holder or holders of such shares
of Common Stock on such date. If the original Debenture to be converted is not
received by the Corporation within five business days after the Date of
Conversion, the notice of conversion shall become null and void.
2.4 Liquidation Damages for Late Conversion. The Corporation shall use
all reasonable efforts to issue and deliver, within three business days after
the holder has fulfilled all conditions and submitted all necessary documents
duly executed and in proper form required for conversion (the "Deadline"), to
the holder or any transferee of the holder at the address of the holder on the
books of the Corporation, a certificate or certificates for the number of Shares
of Common Stock to which the holder shall be entitled. The Corporation
understands that a delay in the issuance of the Shares of Common Stock beyond
the deadline could result in economic loss to the holder. As compensation to
the holder for such loss, the Corporation agrees to pay liquidation damages to
the holder for the late issuance of Shares upon conversion in accordance with
the following schedule (where "No. of Business Days Late" is defined as the
number of business days beyond seven (7) business days from the date of receipt
by the Corporation of a Notice of Conversion and receipt by the transfer agent
of all necessary documentation duly executed and in proper form required for
conversion, including the original Debentures to be converted, all in accordance
with this Agreement):
DEBENTURE-MICROELECTRONIC PACKAGING REV.
<PAGE>
No. of. Business Days Late Liquidated Damages
-------------------------- ------------------
1 $ 500
2 $1,000
3 $1,500
4 $2,000
5 $2,500
6 $3,000
7 $3,500
8 $4,000
9 $4,500
10 $5,000
greater than 10 5,000 + $1,000 for each
Business Day Late
beyond 10 days.
The Corporation shall pay the holder any liquidated damages incurred under
this Section by check upon the earlier to occur of (i) issuance of the Shares to
the holder or (ii) each monthly anniversary of the receipt by the Corporation of
such holder's Notice of Conversion. Nothing herein shall limit the holder's
right to pursue actual damages for the Corporation's failure to issue and
deliver shares of Common Stock to the holder in accordance with the terms of
this Debenture.
2.5 Reservation of Shares. The Corporation shall at all times reserve and
keep available, free from preemptive rights, unissued or treasury shares of
Common Stock sufficient to effect the conversion of this Debenture; and if at
any time the number of authorized but unissued shares of Common Stock shall not
be sufficient to effect the conversion of all then outstanding principal and
interest of this Debenture, the Corporation will take such corporate action as
may be necessary to increase its authorized but unissued shares of Common Stock
to such number of shares as shall be sufficient for such purpose.
3. Default.
3.1 The entire unpaid and unredeemed balance of the Principal Amount and
all Interest accrued and unpaid on this Debenture shall, at the election of the
holder, be and become immediately due and payable upon the occurrence of any of
the following events (a "Default Event"):
(a) The non-payment by the Corporation when due of principal and
interest or of any other payment as provided in this Debenture.
(b) If the Corporation (i) applies for or consents in writing to the
appointment of, or if there shall be a taking of possession by, a receiver,
trustee or liquidator for the Corporation of all or substantially all of its
property; (ii) admits in writing its inability to pay its debts as they become
due; (iii) makes a general assignment for the benefit of creditors; (iv) files
any petition for relief under the Bankruptcy Code or any similar federal or
state statute; or
DEBENTURE-MICROELECTRONIC PACKAGING REV.
<PAGE>
(v) has assessed or imposed against it, or if there shall exist, any general or
specific lien for any federal, state or local taxes against any of its property
or assets other than liens for taxes not yet due or being contested in good
faith.
(c) Any failure by the Corporation to issue and deliver shares of
Common Stock as provided herein upon conversion of this Debenture.
Notwithstanding the foregoing, the Corporation shall have fifteen (15) days
from the receipt of a written Notice of Default to cure said Default Event, and
no acceleration of conversion hereunder shall be deemed to have occurred until
the thirtieth day after the Corporation's receipt of a written Notice of Default
from the holder of this Debenture. Upon such cure, the terms of this Debenture
shall continue in effect.
3.2 Each right, power or remedy of the holder hereof upon the occurrence
of any Default Event as provided for in this Debenture or now or hereafter
existing at law or in equity or by statute shall be cumulative and concurrent
and shall be in addition to every other right, power or remedy provided for it
this Debenture or now or hereafter existing at law or in equity or by statute,
and the exercise or beginning other exercise by the holder or transferee hereof
of any one or more of such rights, powers or remedies shall not preclude the
simultaneous or later exercise by the holder hereof of any or all such other
rights, powers or remedies.
4. Anti-Dilution Adjustments. The Conversion Price shall be subject to
adjustment as follows:
(a) In case the Corporation shall at any time subdivide the
outstanding shares of Common Stock issuable upon conversion of the Debenture,
the conversion price in effect immediately prior to such subdivision shall be
proportionately decreased, and in case the Corporation shall at any time combine
the outstanding shares of Common Stock issuable upon conversion of the
Debenture, the conversion price in effect immediately prior to such combination
shall be proportionately increased. Any such adjustment shall be effective at
the close of business on the date such subdivision or combination shall become
effective.
(b) In case of any reclassification or change of outstanding shares
of Common Stock issuable upon conversion of this Debenture (other than a change
in par value, or from par value to no par value, or from no par value to par
value), or in case of a consolidation or merger of the Corporation with or into
another corporation (other than a merger or consolidation in which the
Corporation is the continuing corporation and which does not result in a
reclassification of outstanding shares of Common Stock of the class issuable
upon the conversion of this Debenture except where the security holders of the
Company are entitled to receive securities of another issuer), or in case of any
sale or conveyance to another corporation of the property of the Corporation as
an entirety or substantially as an entirety, the Corporation or such successor
or purchasing corporation, as the case may be, shall execute an instrument
providing that the holder of this Debenture shall have the right thereafter to
convert this Debenture into the kind and amount of shares of stock and other
securities and property receivable upon such reclassification, consolidation,
merger, sale, or conveyance by the holder of the number of
DEBENTURE-MICROELECTRONIC PACKAGING REV.
<PAGE>
shares of Common Stock of the Corporation into which this Debenture might have
been converted immediately prior to such reclassification, consolidation,
merger, sale, or conveyance. Such interest shall provide for adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for herein. The foregoing provisions of this Debenture shall similarly apply to
successive reclassification of shares of Common Stock and to successive
consolidations, mergers, sales, or conveyances.
5. Failure to Act and Waiver. No failure or delay by the holder hereof
to insist upon the strict performance of any term of this Debenture or to
exercise any right, power or remedy consequent upon a Default Event hereunder
shall constitute a waiver of any such term or of any such breach, or preclude
the holder hereof from exercising any such right, power or remedy at any later
time or times. By accepting payment after the due date of any amount payable
under this Debenture, the holder hereof shall not be deemed to waive the right
either to require payment when due of all other amounts payable under this
Debenture, or to declare a Default Event for failure to effect such payment of
any such other amount.
The failure of the holder of this Debenture to give notice of any failure
or breach of the Corporation under this Debenture shall not constitute a waiver
of any right or remedy in respect of such continuing failure or breach or any
subsequent failure or breach.
6. Consent to Jurisdiction. The Corporation hereby agrees and consents
that any action, suit or proceeding arising out of this Debenture may be brought
in any appropriate court in the State of California, including the United States
District Court for the Central District of California or in any other court
having jurisdiction over the subject matter, all at the sole election of the
holder hereof, and by the issuance and execution of this Debenture the
Corporation irrevocably consents to the jurisdiction of each such court.
7. Transfer/Negotiability. This Debenture shall be transferred on the
books of the Corporation only by the registered holder hereof or by his/her
attorney duly authorized in writing or by delivery to the Corporation of a duly
executed Assignment substantially in the form attached hereto as Exhibit A-1.
The foregoing notwithstanding, the Corporation shall not transfer this Debenture
nor any of the shares of Common Stock issuable upon conversion in the United
States or to a "U.S. Person" (as defined in Regulation S promulgated under the
Act) or for the account and benefit of any U.S. Person, except as provided in
said Regulation S, until forty-five (45) days from the date of issuance of this
Debenture. The Corporation shall be entitled to treat any holder of record of
the Debenture as the holder in fact thereof and shall not be bound to recognize
any equitable or other claim to or interest in this Debenture in the name of any
other person, whether or not it shall have express or other notice thereof, save
as expressly provided by the Laws of California.
8. Notices. All notices and communications under this Debenture shall be
in writing and shall be either delivered in person or accompanied by a signed
receipt therefor or mailed first-class United States certified mail, return
receipt requested, postage prepaid, and addressed as follows:
DEBENTURE-MICROELECTRONIC PACKAGING REV.
<PAGE>
if to the Corporation, to:
Microelectronic Packaging, Inc.
9350 Trade Place
San Diego, CA 92126
Attn: Chief Financial Officer & CEO
with a copy to:
Brobeck Phleger & Harrison, LLP
2200 Geng Road
Palo Alto, CA 94303
Attn: Warren T. Lazarow, Esq.
and, if to the holder of this Debenture, to the address of such holder as it
appears in the books of the Corporation. Any notice of communication shall be
deemed given and received as of the date of such delivery or three days after
deposit with an overnight courier service or five (5) days after deposit with
the U.S. Postal Service as first class air mail.
9. Denominations. The Debentures are issuable in minimum denominations of
$50,000 principal amount and integral multiples thereof. The Debentures are
exchangeable for an equal aggregate principal amount of Debentures for different
authorized denominations as requested by the holder surrendering the same. No
service charge will be made for such exchange.
10. Governing Law. This Debenture shall be governed by and construed and
enforced in accordance with the laws of the State of California, or, where
applicable, the laws of the United States, without regard to conflicts of law.
11. Tax Withholding. The Corporation shall be entitled to withhold from
all payments of principal of, and interest on, the Debentures, amounts, if any,
required to be withheld under applicable provisions of the United States income
tax or other applicable laws at the time of such payments.
12. Incorporation by Reference. The terms and conditions set forth in
that certain Offshore Securities Subscription Agreements between the Corporation
and Purchasers identified therein dated as of October 22, 1996 are incorporated
herein by this reference, and any transferee or subsequent holder of this
Debenture (or the shares of Common Stock issued upon conversion thereof, during
the Restricted Period as defined by Regulation S) shall be subject to and bound
by the provisions of such agreement.
DEBENTURE-MICROELECTRONIC PACKAGING REV.
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this Debenture to be duly
executed.
MICROELECTRONIC PACKAGING, INC.
By:_________________________________
Attest:
__________________________
Secretary
DEBENTURE-MICROELECTRONIC PACKAGING REV.
<PAGE>
EXHIBIT A-1
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby assigns to:
________________ the one year 8% Convertible Debenture of MICROELECTRONIC
PACKAGING, INC. No. _____________ and hereby irrevocably appoints
__________________________, Attorney, to transfer said Debenture on the books of
the within named corporation, with full power of substitution in the premises.
WITNESS my hand and seal this ____ day of ______________________,
199__.
(SEAL)
(SEAL)
WITNESS:
DEBENTURE-MICROELECTRONIC PACKAGING REV.
<PAGE>
NOTICE OF CONVERSION
(To be executed by the registered holder in order to Convert the 8%
Convertible Debenture.)
The undersigned hereby irrevocably elects to convert $____ of the above
8% Convertible Debenture due October __, 1997, represented by Debenture
certificate no(s). ___, into shares of Common Stock of Microelectronic
Packaging, Inc. (the "Company") according to the conditions set forth in such
8% Convertible Debenture, as of the date written below.
The undersigned represents that it is not a U.S. Person as defined in
Regulation S promulgated under the Securities Act of 1933, as amended, and is
not converting the 8% Convertible Debenture on behalf of any U.S. Person, and
that it does not have an intent to act as a distributor of the securities
received upon conversion of the 8% Convertible Debenture and will only
transfer such securities in compliance with the Securities Act of 1933, as
amended.
Date of Conversion*: ____________________________
(Note: Date of Conversion will be the date this Notice of Conversion is
received by the Company.)
Conversion price (subject to confirmation and correction by Company) $_________
Holder: __________________________________ (Holder name)
By:_______________________________ (Signature)
__________________________________ (Name, printed)
__________________________________ (Title)
Address: __________________________________
__________________________________
- -------------
* The original 8% Convertible Debenture(s) and this duly executed Notice of
Conversion must both be received by the Company to effect conversion.
<PAGE>
EXHIBIT 10.82
Form of Common Stock Purchase Warrant dated October 22, 1995 issued by MPI to
Dusseldorf Securities Limited.
<PAGE>
Warrant to
Purchase 75,421
Shares of Common Stock
MICROELECTRONIC PACKAGING, INC.
Common Stock Purchase Warrant
October 24, 1996
THIS WARRANT AND THE SHARES OF COMMON STOCK UNDERLYING THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"). UNTIL THE FORTY-FIFTH (45/TH/) DAY AFTER THE SALE OF THIS WARRANT IS
COMPLETED, NEITHER THIS WARRANT NOR THE UNDERLYING SHARES MAY BE OFFERED, SOLD
OR TRANSFERRED (INCLUDING ANY INTERESTS THEREIN) IN THE UNITED STATES OR TO A
"U.S. PERSON" (AS DEFINED IN REGULATION S PROMULGATED UNDER THE ACT) OR FOR THE
ACCOUNT AND BENEFIT OF A U.S. PERSON, EXCEPT AS PROVIDED IN REGULATION S
PROMULGATED UNDER THE ACT. ANY RESALE THEREAFTER MUST BE PURSUANT TO
REGISTRATION UNDER THE ACT OR AN AVAILABLE EXEMPTION. FURTHER, THIS WARRANT MAY
NOT BE EXERCISED BY OR ON BEHALF OF ANY U.S. PERSONS, UNLESS REGISTERED UNDER
THE ACT OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. NEITHER
MICROELECTRONIC PACKAGING, INC. ("MPI") NOR ITS TRANSFER AGENT SHALL BE
OBLIGATED TO REMOVE THIS LEGEND UNLESS IT SHALL HAVE RECEIVED AN OPINION OF
COUNSEL TO THE HOLDER HEREOF REASONABLY SATISFACTORY TO MPI AND ITS TRANSFER
AGENT STATING THAT SUCH REMOVAL COMPLIES WITH THE REQUIREMENTS OF REGULATION S.
THIS CERTIFIES THAT Dusseldorf Securities Limited (or its Nominees)
(hereinafter sometimes called the "Holder"), is entitled to purchase from
Microelectronic Packaging, Inc., a California corporation (the "Company"), at
the price and during the periods as hereinafter specified, the number of shares
set forth above of the Company's Common Stock, (the "Common Stock").
This Warrant, together with warrants of like tenor, is subject to
adjustment in accordance with Section 6 of this Warrant.
1. The rights represented by this Warrant shall be exercisable at any time
commencing forty-five days after the date hereof (the "Exercise Period") and
shall expire at 5:00 p.m. Pacific Daylight Time on October 24, 1997 (the
"Expiration Date") at an exercise price equal to the lesser of the average price
at which the convertible debentures, issued to holder simultaneously herewith,
are converted into Common Stock, if any such conversion has occurred, or a price
equal to 110% of the closing bid price of the Common Stock as reported by NASDAQ
for the date hereof (the "Exercise Price"), subject to adjustment in accordance
with Section 6. After the Expiration Date, the Holder shall have no right to
purchase any shares of Common Stock underlying this Warrant.
Exhibit "B"
<PAGE>
2. The rights represented by this Warrant may be exercised at any time or
from time to time within the Exercise Period specified above, in whole or in
part, by (i) the surrender of this Warrant (with the purchase form properly
executed) at the principal executive office of the Company (or such other office
or agency of the Company as it may designate by notice in writing to the Holder
at the address of the Holder appearing on the books of the Company); and (ii)
payment in full in United States Dollars in immediately available funds to the
Company of the Exercise Price then in effect for the number of shares of Common
Stock specified in the above-mentioned purchase form together with applicable
stock transfer taxes, if any. This Warrant shall be deemed to have been
exercised, in whole or in part to the extent specified, immediately prior to the
close of business on the date this Warrant is surrendered and payment is made in
accordance with the foregoing provisions of this Section 2, and the person or
persons in whose name or names the certificates for shares of Common Stock shall
be issuable upon such exercise shall become the holder or holders of record of
such shares of Commons Stock at that time and date. The certificate or
certificates for the shares of Common Stock so purchased shall be delivered to
such person or persons within a reasonable time, not exceeding thirty (30) days,
after this Warrant shall have been exercised.
This Warrant may not be exercised (i) by or on behalf of a person who is a
U.S. Person (as defined in Regulation S promulgated under the Act), (ii) if a
U.S. Person has any interest in the Warrants being exercised or the underlying
securities to be issued upon exercise or (iii) by any person if exercised within
the United States or if the shares issuable upon exercise of the Warrant are to
be delivered within the United States. If the above cannot be complied with,
then the Warrant can be exercised only if a written opinion of counsel to the
holder, the form and substance of which is acceptable to the Company, is
delivered to the Company prior to exercise of the Warrants being exercised, and
the underlying securities delivered upon exercise have been registered under the
Act, or the securities are exempt from registration thereunder. In the absence
of an opinion of counsel to the holder reasonably acceptable to the Company
indicating that the certificates representing the securities underlying this
Warrant may be issued without restrictive legends pursuant to an exemption from
the Act, such underlying securities shall bear a legend individually similar to
that set forth on this Warrant.
In connection with the exercise of this Warrant by the holder in accordance
with the terms hereof, the Company and the Holder shall first use their
reasonable efforts to cause the issuance of the shares of Common Stock issuable
upon exercise of the Warrant to be exempt from registration by virtue of
Regulation S promulgated under the Act and in such event, the holder will resell
such shares only in compliance with the applicable Holding period, restrictions
and other provisions of Regulation S. In the event that an exemption from
registration under Regulation S is not then available in connection with the
issuance of the underlying shares of Common Stock upon exercise of the Warrant,
the Company agrees to grant to the holder of the Warrant the registration rights
set forth on Exhibit B-1 attached hereto.
3. Neither this Warrant nor the shares of Common Stock issuable upon
exercise hereof have been registered under the Act nor under any state or
foreign securities law and shall not be transferred, sold, assigned or
hypothecated in violation thereof. If permitted by the foregoing, any such
transfer, sale, assignment or hypothecation shall be effected by the Holder
surrendering this Warrant for cancellation at the office or agency of the
Company referred to in Section 2 hereof, accompanied by an opinion of counsel to
the Holder satisfactory to the Company and its counsel, stating that such
transferee is a permitted transferee under this Section 3 and that such transfer
does not violate the Act or such state securities laws.
2
<PAGE>
4. The Company covenants and agrees that all shares of Common Stock which
may be issued upon exercise of this Warrant will, upon issuance, be duly and
validly issued, fully paid and nonassessable and no personal liability will
attach to the Holder thereof. The Company further covenants and agrees that
during the Exercise Period, the Company will at all times have authorized and
reserved a sufficient number of shares of its Common Stock to provide for the
exercise of this Warrant; provided, however, that, if at any time the number of
authorized but unissued shares of Common Stock shall not be sufficient to effect
the exercise of all shares of Common Stock underlying the Warrant, the Company
will take such corporate action as may be necessary to increase its authorized
but unissued shares of Common Stock to such number of shares as shall be
sufficient for such purpose.
5. The Warrant shall not entitle the Holder to any rights, including,
without limitation, voting rights, as a shareholder of the Company.
6. The Exercise Price in effect at any time and the number and kind of
securities purchasable upon the exercise of this Warrant shall be subject to
adjustment from time to time upon the happening of certain events as follows:
a. If the Company shall (i) declare a dividend or make a distribution
on its outstanding shares of Common Stock in shares of Common Stock, (ii)
subdivide its outstanding shares of Common Stock into a greater number of
shares, (iii) combine its outstanding shares of Common Stock into a smaller
number of shares, or (iv) issue by reclassification of its shares of Common
Stock other securities of the Company, then the Exercise Price in effect
immediately prior to such action shall be proportionately adjusted so that the
holder of any Warrant thereafter exercised may receive the aggregate number and
kind of shares of capital stock of the Company which he would have owned
immediately following such action if such Warrant had been exercised immediately
prior to such action.
b. Whenever the Exercise Price payable upon exercise of each Warrant
is adjusted pursuant to Section 6(a) above, the number of shares of Common Stock
purchasable upon exercise of this Warrant shall simultaneously be adjusted by
multiplying the number of shares of Common Stock initially issuable upon
exercise of this Warrant by the Exercise Price in effect on the date hereof and
dividing the product so obtained by the Exercise Price, as adjusted.
c. Notwithstanding any adjustment in the Exercise Price or the number
or kind of shares of Common Stock purchasable upon the exercise of this Warrant,
certificates for Warrants issued prior or subsequent to such adjustment may
continue to express the same price and number and kind of shares of Common Stock
as are initially issuable pursuant to this Warrant.
d. The Company may, but under no circumstances is obligated, to
modify the terms of this Warrant to extend the Exercise Period or to lower the
Exercise Price, at any time prior to the expiration of this Warrant.
e. In case of any consolidation of the Company with or merger of the
Company into another corporation or in case of any sale, transfer or lease to
another corporation of all or substantially all the property of the Company, the
Company or such successor or purchasing corporation, as the case may be, shall
execute with the Holder an agreement that the Holder shall have the right
thereafter upon payment of the Exercise Price in effect immediately prior to
such action to purchase upon exercise of each Warrant the kind and amount of
shares and
3
<PAGE>
other securities, cash and property which he would have owned or would have been
entitled to receive after the happening of such consolidation, merger, sale,
transfer or lease had such Warrant been exercised immediately prior to such
action; provided, however, that no adjustment in respect of dividends, interest
-------- -------
or other income on or from such shares or other securities, cash and property
shall be made during the term of a Warrant or upon the exercise of a Warrant.
Such agreement shall provide for adjustments, which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Section
6. The provisions of this Section 6(e) shall similarly apply to successive
consolidations, mergers, sales, transfers or leases.
7. The Company shall not be required to issue fractional shares of Common
Stock upon exercise of the Warrants. If more than one Warrant shall be
presented for exercise in full at the same time by the same Holder, the number
of full shares of Common Stock which shall be issuable upon the exercise thereof
shall be computed on the basis of the aggregate number of shares purchasable on
exercise of the Warrants so presented. If any fraction of a share would, except
for the provisions of this Section 7, be issuable on the exercise of any Warrant
(or specified portion thereof), the Company shall pay an amount in cash equal to
the closing price for one share of the Common Stock, as reported by NASDAQ on
the trading day immediately preceding the exercise date, multiplied by such
fraction.
This Warrant shall be governed by and in accordance with the laws of the
State of California.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
duly authorized officers and as of the 24th day of October, 1996.
MICROELECTRONIC PACKAGING, INC.
By: ___________________________________
4
<PAGE>
PURCHASE FORM
Dated , 199
The undersigned hereby irrevocably elects to exercise the within Warrants
to the extent of purchasing _________ shares of Common Stock and hereby makes
payment of $____________ in payment of the exercise price thereof.
------------------------
This Warrant may not be exercised (i) by or on behalf of a person who is a
U.S. person (as defined in Regulation S promulgated under the Securities Act of
1933, as amended (the "Securities Act"), (ii) if a U.S. person has any interest
in the Warrants being exercised or the underlying securities to be issued upon
exercise, or (iii) by any person if exercised within the United States or if the
Warrant Shares are to be delivered within the United States. If the above
cannot be complied with, then the Warrant can be exercised only if a written
-------
opinion of counsel to the Holder of the Warrant, the form and substance of which
is acceptable to the Company, is delivered to the Company prior to exercise to
the Warrants being exercised, and the underlying securities delivered upon
exercise have been registered under the Securities Act, or the securities are
exempt from registration thereunder.
INSTRUCTIONS FOR REGISTRATION OF STOCK
--------------------------------------
Name: _______________________________________________
(Please typewrite or print in block letters.)
Address: _______________________________________________________________________
Signature: __________________________________________
ASSIGNMENT FORM
---------------
FOR VALUE RECEIVED __________________________________ hereby sells,
assigns and transfers unto
Name: ____________________________________________________________
(Please typewrite or print in block letters.)
Address: _______________________________________________________________________
Social Security No. or Employment Identification No. ___________________________
The right to purchase Common Stock represented by this Warrant to the extent of
____ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ____________ ____________ attorney to transfer the same
on the books of the Company with full power of substitution.
Dated: _____ , 199__
Signature __________________________________
Signature Guaranteed:
______________________
Social Security Number
<PAGE>
REGISTRATION RIGHTS
-------------------
1. Piggy-Back Registration Rights. If at any time prior to the
termination date (as defined below) (1) the Company proposes to register any
of its securities under the Act (other than in connection with a merger,
acquisition or exchange offer or pursuant to Form S-8 or successor form), it
will give written notice by certified or registered mail, at least thirty (30)
days prior to the filing of the registration statement to the holder of record
of the Warrant (the "Registered Holder") of its intention to do so. Upon the
written request of the Registered Holder, given within fifteen (15) days after
receipt of any such notice of his, her or its desire to include the sale of
any shares of Common Stock underlying the Warrant ("Warrant Shares") in such
proposed registration statement, the Company shall, subject to registration
rights of other holders of securities of the Company existing as of the date
of the Warrant (the "Prior Holders"), use its best efforts to obtain the
necessary consents or waivers from the Prior Holders such that the Registered
Holder's Warrant Shares may be included in such registration.
The "piggy-back" registration rights described in this Exhibit B-1 shall
terminate on the earlier of (i) the second anniversary of the Expiration Date,
(ii) the second anniversary of the date when Warrants shall have been
exercised in full, (iii) the date when all Warrant Shares have been sold by
the Registered Holder, and (iv) such time as all of the Warrant Shares held by
the Registered Holder can be sold by such Registered Holder within a given
three (3) month period without compliance with the registration requirements
of the Act, pursuant to Rule 144 promulgated thereunder (the Termination
Date); provided, however, that a Registered Holder shall only be entitled
pursuant to this paragraph to have the Warrant Shares registered and shall not
be entitled to have the Warrant registered.
Notwithstanding anything to the contrary contained in the provisions of
this Exhibit B-1, the Company shall have the right at any time after it shall
have given written notice pursuant to this Section 1 (irrespective of whether
a written request for inclusion of any securities shall have been made), to
elect not to file any such proposed registration statement, or to withdraw the
same after the filing but prior to the effective date thereof.
2. Indemnification. The Company shall indemnify and hold harmless the
Registered Holder who registers Warrant Shares pursuant to this Exhibit B-1,
from and against any and all losses, claims, damages and liabilities caused by
any untrue statement or a material fact contained in any registration
statement filed by the Company under the Act in accordance with this Exhibit
B-1, any post-effective amendment to such registration statement, or any
<PAGE>
prospectus included therein, or caused by any omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission
based upon information furnished or required to be furnished in writing to the
Company by the Registered Holder (or the authorized representatives or agents
of the Registered Holder) expressly for use therein which indemnification
shall include each person, if any, who controls the Registered Holder within
the meaning of the Act and each officer, director, employee and agent of the
Registered Holder; provided, however, that the indemnification in this Section
2 with respect to any prospectus shall not inure to the benefit of the
Registered Holder (or to the benefit of any person controlling the Registered
Holder) on account of any such loss, claim, damage or liability arising from
the sale of Warrant Shares by such Registered Holder, if a copy of a
subsequent prospectus correcting the untrue statement or omission in such
earlier prospectus was provided to such Registered Holder by the Company prior
to the subject sale and the subsequent prospectus was not delivered or sent by
the Registered Holder to the purchaser of such securities prior to such sale;
and provided further, that the Company shall not be obligated to so indemnify
the Registered Holder or any other person referred to above unless the
Registered Holder or other person as the case may be, shall at the same time
indemnify the Company, its directors, each officer signing the registration
statement and each person, if any, who controls the Company within the meaning
of the Act, from and against any and all losses, claims, damages and
liabilities caused by any untrue statement or a material fact contained in any
registration statement or any prospectus required to be filed or furnished in
connection with the public offering or caused by any omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, insofar as such losses, claims, damages or
liabilities are caused by any untrue statement or omission based upon
information furnished in writing to the Company by the Registered Holder
expressly for use therein.
If for any reason the indemnification provided for in the preceding
subparagraph is held by a court of competent jurisdiction to be unavailable to
an indemnified party with respect to any loss, claim, damages, liability or
expense referred to therein, then the indemnifying party in lieu of
indemnifying such indemnified party thereunder, shall contribute to the amount
paid or payable by the indemnified party as a result of such loss, claim,
damage or liability in such proportion as is appropriate to reflect not only
the relative benefits received by the indemnified party and the indemnifying
party, but also the relative fault of the indemnified party and the
indemnifying party, as well as any other relevant equitable consideration.
3. Offering Expenses. All expenses, filing fees and other costs incurred
by the Company in connection with the registration of securities pursuant to
this Exhibit B-1 (exclusive of
<PAGE>
underwriting discounts and selling commissions applicable to any sale of Warrant
Shares and any fees and costs of legal counsel engaged by the Registered Holder)
shall be borne by the Company.
4. Delivery of Prospectus. In the case of each registration effected by the
Company pursuant to the provisions of this Exhibit B-1, the Company will (i)
furnish to the Registered Holder of the Warrant Shares registered such numbers
of copies of a prospectus, including a preliminary prospectus, in conformity
with the requirements of the Act and such other documents as such Registered
Holder may reasonably request in order to facilitate the disposition of the
Warrant Shares so registered, and (ii) notify the Registered Holder of
securities covered by such registration statement at any time when a prospectus
relating thereto is required to be delivered under the Act or the happening of
any event as a result of which the prospectus included in such registration
statement, as then in effect, included an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the circumstances then
existing.
5. Defined Terms. Capitalized terms used but not defined herein shall have
the meanings ascribed such words in the Warrant to which this Exhibit B-1 is
attached.
<PAGE>
EXHIBIT 10.83
CONTACT:
Microelectronic Packaging, Inc.
Timothy da Silva, President & CEO
(619) 530-1660
FOR IMMEDIATE RELEASE
MICROELECTRONIC PACKAGING COMPLETES
CONVERTIBLE DEBENTURE FINANCING
San Diego, California--October 28, 1996--Microelectronic Packaging, Inc.
("MPI") (Nasdaq National Market: MPIX) today announced that it has sold and
issued U.S. $2.8 million of convertible debentures to institutional investors.
The debentures bear interest at a rate of 8% per year and are due and
payable on or before October 23, 1997. Subject to certain limitations, the
debentures may be converted at the option of the holders into shares of common
stock. The Company also issued to one investor a warrant to purchase 75,421
shares of common stock.
Timothy da Silva, President and Chief Executive Officer of MPI, said "This
additional funding will be utilized to support the growth of MPM (S) Pte Ltd,
our subsidiary in Singapore, which manufactures Multilayer Ceramic Packages
(MLC) and Multi-Chip Module (MCM) substrates using IBM technology and production
equipment. MLC packages and MCM substrates are key products currently under
development and the company believes these products will figure prominently in
its future strategy."
2-2-2 MPIX/Financing
Microelectronic Packaging, Inc. is a leading international semiconductor
packaging company with design services, manufacturing and sales capability to
support the device packaging and electronic systems interconnection requirements
of integrated circuit ("IC") and electronic systems manufacturers. At its San
Diego, California headquarters and Singapore manufacturing facilities, the
Company develops, manufactures, markets and sells pressed ceramic packages,
advanced IC packaging products and MCMs to customers in the IC, communications,
automatic test equipment and other electronics-related industries.
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