Exhibit 4.5
PACIFIC CIRCUITS, INC.
WARRANT AGREEMENT
This WARRANT AGREEMENT is dated as of July 13, 1999 (the "AGREEMENT")
and entered into by and among Pacific Circuits, Inc., a Washington corporation
(the "COMPANY "), and the purchasers party hereto (each, a "PURCHASER" and
collectively, the "PURCHASERS"). All capitalized terms used but not defined
herein shall have the respective meanings ascribed to them in the Purchase
Agreement (as hereinafter defined).
WHEREAS, pursuant to a Securities Purchase Agreement dated as of the
date hereof (the "PURCHASE AGREEMENT") by and among the Company, the Subsidiary
Guarantor identified therein and the Purchasers, the Company proposes to issue
to the Purchasers certain Warrants, as hereinafter described (the "WARRANTS"),
to purchase an aggregate of 2,019 shares (subject to adjustment) of the common
stock, no par value per share (together with all other classes of common stock
of the Company, the "COMMON STOCK"), of the Company (the shares of Common Stock
and other securities issuable upon exercise of the Warrants being referred to
herein as the "WARRANT SHARES");
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
SECTION 1. WARRANT CERTIFICATES. The Company will issue and deliver a
certificate or certificates evidencing the Warrants (the "WARRANT CERTIFICATES")
pursuant to the terms of the Purchase Agreement. Each Warrant Certificate shall
be substantially in the form set forth as Exhibit A attached hereto. The Warrant
Certificates shall be dated the date of issuance by the Company.
SECTION 2. EXECUTION OF WARRANT CERTIFICATES. The Warrant Certificates
shall be signed on behalf of the Company by its Chairman of the Board, Chief
Executive Officer, President or a Vice President. Each such signature upon the
Warrant Certificates may be in the form of a facsimile signature of the present
or any future Chairman of the Board, Chief Executive Officer, President or Vice
President, and may be imprinted or otherwise reproduced on the Warrant
Certificates and for that purpose the Company may adopt and use the facsimile
signature of any person who shall have been Chairman of the Board, Chief
Executive Officer, President or Vice President, notwithstanding the fact that
at the time the Warrant Certificates shall be delivered or disposed of he shall
have ceased to hold such office.
SECTION 3. REGISTRATION. The Company shall number and register the
Warrant Certificates in a register (the "WARRANT REGISTER") as they are
issued. The Company may deem and treat the registered holder(s) from time to
time of the Warrant Certificates (the "HOLDERS") as the absolute owner(s)
thereof (notwithstanding any notation of ownership or other writing on the
Warrant Certificate made by anyone) for all purposes and shall not be
affected by any notice to
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the contrary. The Warrants shall be registered initially in such name or names
as the Purchasers shall designate.
SECTION 4. RESTRICTIONS ON TRANSFER: REGISTRATION OF TRANSFERS AND
EXCHANGES. Prior to any proposed transfer of the Warrants, unless such transfer
is made pursuant to an effective registration statement under the Securities Act
of 1933, as amended (the "Act"), the transferring Holder will deliver to the
Company an opinion of counsel, reasonably satisfactory in form and substance to
the Company, to the effect that the Warrants may be sold or otherwise
transferred without registration under the Act; PROVIDED, HOWEVER, that with
respect to transfers by Holders to their Affiliates, no such opinion shall be
required. A transfer made by a Holder which is a state-sponsored employee
benefit plan to a successor trust or fiduciary pursuant to a statutory
reconstitution shall be expressly permitted and no opinions of counsel shall be
required in connection therewith. Upon original issuance thereof, and until such
time as the same shall have been registered under the Act or sold pursuant to
Rule 144 promulgated thereunder (or any similar rule or regulation), each
Warrant Certificate shall bear the legends included on the first page of Exhibit
A, unless in the opinion of such counsel, the legend regarding securities law
transfer restrictions (described in the Purchase Agreement) is no longer
required by the Act.
Subject to the conditions to transfer contained in the Purchase
Agreement and the transfer restrictions set forth in this Section 4 and in
Section 15 hereof, the Company shall from time to time register the transfer of
any outstanding Warrant Certificates in the Warrant Register to be maintained by
the Company upon surrender thereof accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company, duly executed by
the registered Holder or Holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney. Upon any such
registration of transfer, a new Warrant Certificate shall be issued to the
transferee Holder(s) and the surrendered Warrant Certificate shall be canceled
and disposed of by the Company.
SECTION 5. WARRANTS: EXERCISE OF WARRANTS. Subject to the terms of this
Agreement, each Holder shall have the right, which may be exercised commencing
on the date hereof and continuing until the tenth anniversary of the date of
this Agreement, to receive from the Company the number of fully paid and
nonassessable Warrant Shares (and such other consideration) which the Holder may
at the time be entitled to receive upon exercise of such Warrants and payment of
the Exercise Price (as defined below) then in effect for such Warrant Shares. No
adjustments as to dividends will be made upon exercise of the Warrants, except
as otherwise expressly provided herein.
The price at which each Warrant shall be exercisable (the "EXERCISE
PRICE") shall initially be $0.01 per share, subject to adjustment pursuant to
the terms hereof.
A Warrant may be exercised by surrender to the Company at its office
designated for such purpose (as provided for in Section 13 hereof) of the
Warrant Certificate or Certificates to be exercised, with the form of election
to purchase attached thereto duly filled in and signed, and by payment to the
Company of the Exercise Price for the number of Warrant Shares in respect of
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which such Warrants are then exercised. Payment of the aggregate Exercise Price
shall be made by one of the following methods or any combination thereof: (a) by
delivering to the Company the aggregate Exercise Price in cash or by certified
or official bank check payable to the order of the Company, (b) if the Holder or
one of its Affiliates is also a Holder of a Note, by instructing the Company, in
the notice of exercise submitted to the Company, to apply the payment of the
aggregate Exercise Price against the outstanding principal balance of the Note
held by such Holder or its Affiliate ("OFFSET EXERCISE"), or (c) by deducting
from the number of Warrant Shares to be received by the exercising Holder that
number of Warrant Shares which has an aggregate Specified Value (as hereinafter
defined) on the date of exercise equal to the aggregate Exercise Price for all
Warrant Shares as to which the Warrant is then being exercised ("NET EXERCISE").
Subject to the provisions of Section 6 hereof, upon such surrender of
Warrant Certificates and payment of the Exercise Price, the Company shall issue
and cause to be delivered, as promptly as practicable, to or upon the written
order of the Holder and in such name or names as such Holder may designate a
certificate or certificates for the number of full Warrant Shares issuable upon
the exercise of such Warrants (and such other consideration as may be
deliverable upon exercise of such Warrants) together with cash for any
fractional Warrant Share as provided in Section 11 hereof. The certificate or
certificates for such Warrant Shares shall be deemed to have been issued, and
the Person so named therein shall be deemed to have become a holder of record of
such Warrant Shares, as of the date of the surrender of such Warrants and
payment of the Exercise Price, irrespective of the date of delivery of such
certificate or certificates for Warrant Shares. Upon issuance by the Company of
such Warrant Shares, the Holder thereof shall become party to that certain
Amended and Restated Shareholder's Agreement of even date herewith between the
Company, Circuit Holdings, LLC, ▇▇▇▇▇ 0. ▇▇▇▇▇ III, and those purchasers
described therein.
Each Warrant shall be exercisable, at the election of the Holder
thereof, in full and not in part; PROVIDED THAT, contemporaneously with any
exercise by such Holder, all Affiliates of such Holder elect to exercise all of
the Warrants then held by such Affiliates.
All Warrant Certificates surrendered upon exercise of Warrants shall be
cancelled and disposed of by the Company. The Company shall keep copies of this
Agreement and any notices given or received hereunder available for inspection
by the Holders during normal business hours at its office.
SECTION 6. PAYMENT OF TAXES. The Company will pay all documentary stamp
taxes and other governmental charges (excluding all Federal, state or foreign
income, franchise, intangibles, property, estate, inheritance, gift or similar
taxes) imposed in connection with the issuance or delivery of the Warrants
hereunder, as well as all such taxes attributable to the initial issuance or
delivery of Warrant Shares upon the exercise of Warrants and payment of the
Exercise Price. The Company shall not, however, be required to pay any tax that
may be payable in respect of any subsequent transfer of the Warrants or any
transfer involved in the issuance and delivery of Warrant Shares in a name other
than that in which the Warrants to which such issuance relates were registered,
and, if any such tax would otherwise be payable by the Company, no such
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issuance or delivery shall be made unless and until the Person requesting such
issuance has paid to the Company the amount of any such tax, or it is
established to the reasonable satisfaction of the Company that any such tax has
been paid.
SECTION 7. MUTILATED OR MISSING WARRANT CERTIFICATES. If a mutilated
Warrant Certificate is surrendered to the Company, or if the Holder of a Warrant
Certificate claims and submits an affidavit or other evidence satisfactory to
the Company to the effect that the Warrant Certificate has been lost, destroyed
or wrongfully taken, the Company shall issue a replacement Warrant Certificate.
If required by the Company such Holder must provide an indemnity bond, or other
form of indemnity, sufficient in the judgment of the Company to protect the
Company from any loss which it may suffer if a Warrant Certificate is replaced.
If any Purchaser or any other institutional Holder (or nominee thereof) is the
owner of any such lost, stolen or destroyed Warrant Certificate, then the
affidavit of an authorized officer of such owner, setting forth the fact of
loss, theft or destruction and of its ownership of the Warrant Certificate at
the time of such loss, theft or destruction shall be accepted as satisfactory
evidence thereof and no further indemnity shall be required as a condition to
the execution and delivery of a new Warrant Certificate other than the unsecured
written agreement of such owner to indemnify the Company or, at the option of
such Purchaser or other institutional Holder, an indemnity bond in the amount of
the Specified Value (as defined in Section 9(f) hereof) of the Warrant Shares
for which such Warrant Certificate was exercisable.
SECTION 8. RESERVATION OF WARRANT SHARES. The Company shall at all
times reserve and keep available, free from preemptive rights (except as
otherwise provided herein), out of the aggregate of its authorized but unissued
Common Stock or its authorized and issued Common Stock held in its treasury, for
the purpose of enabling it to satisfy any obligation to issue Warrant Shares
upon exercise of Warrants, the maximum number of shares of Common Stock which
may then be deliverable upon the exercise of all outstanding Warrants.
The Company or, if appointed, the transfer agent for the Common Stock
and each transfer agent for any shares of the Company's Capital Stock issuable
upon the exercise of any of the Warrants (collectively, the "TRANSFER AGENT")
will be irrevocably authorized and directed at all times to reserve such number
of authorized shares as shall be required for such purpose. The Company shall
keep a copy of this Agreement on file with any such Transfer Agent. The Company
will supply any such Transfer Agent with duly executed certificates for such
purposes and will provide or otherwise make available all other consideration
that may be deliverable to the Holders upon exercise of the Warrants. The
Company will furnish any such Transfer Agent a copy of all notices of
adjustments and certificates related thereto, transmitted to each Holder
pursuant to Section 12 hereof.
Before taking any action which would cause an adjustment pursuant to
Section 9 hereof to reduce the Exercise Price below the then par value (if any)
of the Warrant Shares, the Company shall take any corporate action which may, in
the opinion of its counsel, be necessary in order that the Company may validly
and legally issue fully paid and nonassessable Warrant Shares at the Exercise
Price as so adjusted.
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The Company covenants that all Warrant Shares and other Capital Stock
issued upon exercise of Warrants will, upon payment of the Exercise Price
therefor and issue thereof, be validly authorized and issued, fully paid,
nonassessable, free of preemptive rights (except as may be granted by this
Agreement) and free, subject to Section 6 hereof, from all taxes, liens, charges
and security interests with respect to the issue thereof.
SECTION 9. ADJUSTMENT OF EXERCISE PRICE AND WARRANT NUMBER. The number
of shares of Common Stock issuable upon the exercise of each Warrant (the
"WARRANT NUMBER") is initially one, and the initial number of Warrant Shares is
2,019. The Warrant Number is subject to adjustment from time to time upon each
occurrence of an event described in, or as otherwise provided in, this Section
9.
(a) ADJUSTMENT FOR CHANGE IN CAPITAL STOCK
If the Company hereafter:
(1) pays a dividend or makes a distribution on its Common
Stock in shares of its Common Stock;
(2) subdivides or reclassifies its outstanding shares of
Common Stock into a greater number of shares;
(3) combines or reclassifies its outstanding shares of
Common Stock into a smaller number of shares;
(4) makes a distribution on Common Stock in shares of its
Capital Stock other than Common Stock; or
(5) issues by reclassification of its Common Stock any
shares of its Capital Stock (other than reclassifications arising solely as a
result of a change in the par value or no par value of the Common Stock);
then the Warrant Number 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 it would have owned immediately following such action if
such Warrant had been exercised immediately prior to such action.
The adjustment shall be determined as of the record date in the case of
a dividend or distribution and upon the effective date in the case of a
subdivision, combination or reclassification and shall be effective
simultaneously with the consummation of any such action.
Such adjustment shall be made successively whenever any event listed
above shall occur. If the occurrence of any event listed above results in an
adjustment under subsection (b) below or
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a distribution under Section 10 hereof, no further adjustment shall be made
under this subsection (a).
The Company shall not issue shares of Common Stock as a dividend or
distribution on any class of Capital Stock other than Common Stock unless the
Holders also receive such dividend or distribution on a ratable basis or the
appropriate adjustment to the Warrant Number is made under this Section 9.
(b) ADJUSTMENT FOR RIGHTS ISSUE
If the Company hereafter distributes (without receipt of consideration
therefor) any rights, options or warrants (whether or not immediately
exercisable) to all holders of any class of its Common Stock entitling them to
purchase shares of Common Stock at a price per share less than the Specified
Value (as defined in subsection 9(f) hereof) per share on the record date
relating to such distribution, the Warrant Number shall be adjusted in
accordance with the formula:
W' = W x O + N
-------
O + N x P
-----
M
where:
W' = the adjusted Warrant Number.
W = the Warrant Number immediately prior to the record date for
any such distribution.
0 = the number of shares of Common Stock outstanding on the
record date for any such distribution.
N = the number of additional shares of Common Stock issuable upon
exercise of such rights, options or warrants.
P = the exercise price per share of such rights, options or
warrants.
M = the Specified Value per share of Common Stock on the record
date for any such distribution.
The adjustment shall be made successively whenever any such rights,
options or warrants are so issued. Such adjustments shall be determined as of
the record date for the determination of stockholders entitled to receive the
rights, options or warrants and shall become effective simultaneously with the
issuance of such rights, options or warrants. If at the end of the period during
which such rights, options or warrants are exercisable, not all rights, options
or warrants shall have been exercised, the adjusted Warrant Number shall be
immediately readjusted to what it would have been if "N" in the above formula
had been the number of shares actually issued upon exercise of those rights,
options or warrants. If any such rights, options, or warrants are subsequently
amended to reduce the purchase price per share of Common Stock upon exercise of
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such rights, options, or warrants, such amendment will be treated as a
distribution of such rights, options, or warrants subject to this SUBSECTION
9(b).
(c) ADJUSTMENT FOR REDEMPTIONS
If the Company hereafter redeems any shares of Common Stock for
consideration per share more than the Specified Value per share, on the date the
Company fixes the redemption price of such shares, the Warrant Number shall be
adjusted in accordance with the formula:
P
-
W' = W x O + M
-------
A
where:
W' = the adjusted Warrant Number.
W = the Warrant Number immediately prior to any such issuance.
0 = the number of shares of Common Stock outstanding immediately
after the redemption of the shares of Common Stock.
P = the aggregate consideration provided for the redemption of
such shares of Common Stock.
M = the Specified Value per share of Common Stock on the date of
the redemption.
A = the number of shares of Common Stock outstanding immediately
prior to the redemption of the Common Stock.
The adjustment shall be made successively whenever any such redemption
is made, and shall become effective immediately after such redemption. Such
adjustments shall be determined as of the date on which the Company fixes the
redemption price and shall become effective simultaneously with such redemption.
This subsection (c) does not apply to any of the transactions described
in subsection (a) of this Section 9.
(d) ADJUSTMENT FOR COMMON STOCK ISSUE
If the Company hereafter issues shares of Common Stock for a
consideration per share (determined in accordance with subsection 9(g)) less
than the Specified Value per share, on the date the Company fixes the offering
price of such additional shares, the Warrant Number shall be adjusted in
accordance with the formula:
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W' = W x A
-------
O + P
-
M
where:
W' = the adjusted Warrant Number.
W = the Warrant Number immediately prior to any such issuance.
0 = the number of shares of Common Stock outstanding immediately
prior to the issuance of such additional shares of Common
Stock.
P = the aggregate consideration received for the issuance of
such additional shares of Common Stock.
M = the Specified Value per share of Common Stock on the date of
issuance of such additional shares.
A = the number of shares of Common Stock outstanding immediately
after the issuance of such additional shares of Common Stock.
The adjustment shall be made successively whenever any such issuance is
made, and shall become effective immediately after such issuance.
This subsection (d) does not apply to any of the transactions described
in subsection (a) of this Section 9.
Notwithstanding anything to the contrary herein and regardless of
whether the consideration per share is equal to or greater than the Specified
Value on the date the Company fixed the offering price for such shares, in the
event any PIK Securities are ever exercised or converted by the holder thereof,
the Warrant Number on the date of such exercise or conversion shall be adjusted
pursuant to this subsection 9(d) by applying the formula set forth above, except
that any interest or dividends paid in kind or any consideration paid with
interest or dividends paid in kind shall be excluded from the calculation of "P"
and "M". The term "PIK Securities" means any Securities issued by the Company
which are convertible into or exchangeable or exercisable for shares of Common
Stock and which provide for payment of interest or dividends in kind or permit
the payment of the exercise price of any option, warrant or other convertible
security with interest or dividends paid in kind.
(e) ADJUSTMENT FOR CONVERTIBLE SECURITIES ISSUE
If the Company hereafter issues any options, warrants or other
securities convertible into or exchangeable or exercisable for Common Stock
(other than securities issued in transactions described in subsection 9(b)) for
an aggregate consideration per share of Common Stock (determined in accordance
with clause (3) of subsection 9(g)) initially deliverable upon
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conversion, exchange or exercise of such securities at less than the Specified
Value per share on the date of issuance of such options, warrants or other
securities (without considering any effect of vesting restrictions), the Warrant
Number shall be adjusted in accordance with the following formula:
W' = W x O + D
-------
O + P
-
M
where:
W' = the adjusted Warrant Number.
W = the Warrant Number immediately prior to any such issuance.
0 = the number of shares of Common Stock outstanding immediately
prior to the issuance of such securities.
P = the sum of the aggregate consideration received for the
issuance of such securities and the aggregate minimum
consideration receivable by the Company for issuance of Common
Stock upon conversion or in exchange for, or upon exercise of,
such securities.
M = the Specified Value per share of Common Stock on the date of
issuance of such securities.
D = the maximum number of shares of Common Stock deliverable upon
conversion or in exchange for or upon exercise of such
securities at the initial conversion, exchange or exercise
rate.
The adjustment shall be made successively whenever any such issuance is
made, and shall become effective immediately after such issuance. If any such
options, warrants, or other securities convertible into or exchangeable for
Common Stock are subsequently amended to reduce the aggregate consideration per
share of Common Stock upon conversion, exchange or exercise of such options,
warrants, or securities, such amendment will be treated as an issuance of such
rights, options, or warrants subject to this subsection 9(e).
If all of the Common Stock deliverable upon conversion, exchange or
exercise of such options, warrants or other securities has not been issued when
the conversion, exchange or exercise rights of such options, warrants or other
securities have expired, become permanently unexercisable or been terminated,
then the adjusted Warrant Number shall promptly be readjusted to the adjusted
Warrant Number which would then be in effect had the adjustment upon the
issuance of such options, warrants or other securities been made on the basis of
the actual number of shares of Common Stock issued upon conversion, exchange or
exercise of such options, warrants or other securities. If the aggregate minimum
consideration receivable by the Company
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for issuance of Common Stock upon conversion or in exchange for, or upon
exercise of, such options, warrants or other securities shall be increased by
virtue of provisions therein contained or upon the arrival of a specified date
or the happening of a specified event, then the Warrant Number shall promptly be
readjusted to the Warrant Number which would then be in effect had the
adjustment upon the issuance of such options, warrants or other securities been
made on the basis of such increased minimum consideration.
This subsection (e) does not apply to any issuance of the Warrants or
to any of the transactions described in subsection 9(b).
(f) SPECIFIED VALUE
"SPECIFIED VALUE" per share of Common Stock or of any other security
(herein collectively referred to as a "SECURITY") at any date shall be:
(1) if the Security is not registered under the Act, the
value of the Security determined in good faith by the Board of Directors of the
Company and certified in a board resolution adopted by the Board of Directors,
if the recipients of a majority of such Securities are not Affiliates of the
Company, otherwise the value of the Security as mutually agreed by the Company
and Holders of at least a majority of the Warrants outstanding; PROVIDED,
HOWEVER, that if the Company and such Holders are unable to mutually agree upon
such value, the Company shall select an Independent Financial Expert who shall
determine the value of such Security, or
(2) if the Security is registered under the Exchange Act,
the average of the daily market prices (as defined below) for each Business Day
during the period commencing 30 Business Days before such date and ending on the
date one Business Day prior to such date or, if the Security has been registered
under the Exchange Act for less than 30 consecutive Business Days before such
date, then the average of the daily market prices (as hereinafter defined) for
all of the Business Days before such date for which daily market prices are
available. If the market price is not determinable for at least 15 Business Days
in such period, the Specified Value of the Security shall be determined as if
the Security was not registered under the Exchange Act.
The "MARKET PRICE" for any Security on each Business Day means: (A) if
such Security is listed or admitted to trading on any securities exchange, the
closing price, regular way, on such day on the principal exchange on which such
Security is traded, or if no sale takes place on such day, the average of the
closing bid and asked prices on such day or (B) if such Security is not then
listed or admitted to trading on any securities exchange, the last reported sale
price on such day, or if there is no such last reported sale price on such day,
the average of the closing bid and the asked prices on such day, as reported by
a reputable quotation source designated by the Company. If there are no such
prices on a Business Day, then the market price shall not be determinable for
such Business Day.
In the case of Common Stock, if more than one class of Common Stock is
outstanding, the "Specified Value" shall be the Specified Value per share of the
class or classes of Common Stock to which compensation is apportioned.
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"INDEPENDENT FINANCIAL EXPERT" shall mean a nationally or regionally
recognized valuation firm selected by the Company (i) that does not (and whose
directors, officers, employees and Affiliates do not) have a direct or indirect
financial interest in the Company, (ii) that has not been, and, at the time it
is called upon to serve as an Independent Financial Expert under this Agreement
is not (and none of whose directors, officers, employees or Affiliates is) a
director or officer of the Company, (iii) that has not been retained by the
Company for any purpose, other than to perform an equity valuation, within the
preceding twelve months, and (iv) that, in the reasonable judgment of the Board
of Directors of the Company, is otherwise qualified to serve as an independent
financial advisor. Any such person may receive customary compensation and
indemnification by the Company for opinions or services it provides as an
Independent Financial Expert.
(g) CONSIDERATION RECEIVED
For purposes of any computation respecting consideration received
pursuant to subsections (c), (d) and (e) of this Section 9, the following shall
apply:
(1) in the case of the issuance or redemption of shares of Common Stock
for cash, the consideration shall be the amount of such cash (without any
deduction being made for any commissions, discounts or other expenses incurred
by the Company for any underwriting of the issue or otherwise in connection
therewith);
(2) in the case of the issuance or redemption of shares of Common Stock
for a consideration in whole or in part other than cash, the value of the
consideration other than cash shall be determined in the same manner as
Specified Value is determined in subsection 9(f); and
(3) in the case of the issuance of options, warrants or other
securities convertible into or exchangeable or exercisable for shares of Common
Stock, the aggregate consideration received therefor shall be deemed to be the
consideration received by the Company for the issuance of such options, warrants
or other securities plus the additional minimum consideration, if any, to be
received by the Company upon the conversion, exchange or exercise thereof (the
consideration in each case to be determined in the same manner as provided in
clauses (1) and (2) of this subsection(g)).
(h) WHEN DE MINIMIS ADJUSTMENT MAY BE DEFERRED
No adjustment in the Warrant Number need be made unless the adjustment
would require an increase or decrease of at least .10% in the Warrant Number.
Any adjustment that is not so made shall be carried forward and taken into
account in any subsequent adjustment; PROVIDED that no such adjustment as to a
particular Warrant shall be deferred beyond the date on which that Warrant is
exercised.
All calculations under this Section 9 shall be made to the nearest
1/100th of a share.
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(i) ADJUSTMENT TO EXERCISE PRICE
Upon each adjustment to the Warrant Number pursuant to this Section 9,
the Exercise Price shall be adjusted so that it is equal to (i) the Exercise
Price in effect immediately prior to such adjustment, multiplied by (ii) a
quotient, the numerator of which is the Warrant Number in effect immediately
prior to such adjustment, and the denominator of which is the Warrant Number in
effect immediately after such adjustment.
(j) WHEN NO ADJUSTMENT REQUIRED
If an adjustment is made upon the establishment of a record date for a
distribution subject to subsection (a) or (1)) hereof or a redemption subject to
subsection (c) hereof and such distribution or redemption is subsequently
cancelled, the Warrant Number and the Exercise Price then in effect shall be
readjusted, effective as of the date when the Board of Directors determines to
cancel such distribution or redemption, to that which would have been in effect
if such record date for such distribution or redemption had not been fixed.
No readjustment under this Section 9 to reverse or amend an adjustment
made under this Section 9 may have the effect of decreasing the Warrant Number
or increasing the Exercise Price in excess of the amount of the increase in the
Warrant Number or decrease in the Exercise Price effected by the adjustment
being reversed or amended.
To the extent the Warrants become convertible into cash, no adjustment
need be made thereafter as to the amount of cash into which such Warrants are
exercisable. Interest will not accrue on the cash.
(k) NOTICE OF ADJUSTMENT
Whenever the Warrant Number and the Exercise Price is adjusted, the
Company shall provide the notices required by Section 12 hereof.
(l) REORGANIZATIONS
In case of any capital reorganization, or reclassification of the
Capital Stock of the Company (other than in the cases referred to in subsections
9(a), (b), (c), (d) or (e) of this Section 9 other than a change in par value
without a change in the number of shares), the consolidation or merger of the
Company with or into another corporation or other entity (other than a merger or
consolidation in which the Company is the continuing corporation and which does
not result in any reclassification of the outstanding shares of Common Stock
into shares of other stock or other securities or property of any other Person),
or the sale of the property of the Company as an entirety or substantially as an
entirety (collectively, such actions being hereinafter referred to as
"REORGANIZATIONS"), there shall thereafter be deliverable upon exercise of any
Warrant (in lieu of the number of shares of Common Stock theretofore
deliverable) the kind and number of shares of stock or other securities or
property to which a holder of the number of shares of Common Stock that would
otherwise have been deliverable upon the exercise of such
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Warrant would have been entitled upon such Reorganization if such Warrant had
been exercised in full immediately prior to such Reorganization. In case of any
Reorganization, appropriate adjustment, as determined in good faith by the Board
of Directors of the Company, whose determination shall be described in a duly
adopted resolution certified by the Company's Secretary or Assistant Secretary,
shall be made in the application of the provisions herein set forth with respect
to the rights and interests of Holders so that the provisions set forth herein
shall thereafter be applicable, as nearly as possible, in relation to any shares
or other property thereafter deliverable upon exercise of Warrants.
The Company shall not effect any such Reorganization unless prior to or
simultaneously with the consummation thereof the successor corporation (if other
than the Company) or other entity resulting from such Reorganization or the
corporation purchasing or leasing such assets or other appropriate corporation
or entity shall expressly assume, by a supplemental Warrant Agreement or other
acknowledgment satisfactory to the Holders executed and delivered to the
Holders, the obligation to deliver to each such Holder such shares of stock or
other securities or property as, in accordance with the foregoing provisions,
such Holder may be entitled to purchase, and all other obligations and
liabilities under this Agreement.
(m) FORM OF CERTIFICATES
Irrespective of any adjustments in the Exercise Price or the number or
kind of shares purchasable upon the exercise of the Warrants, the Warrant
Certificates theretofore or thereafter issued may continue to express the same
price and number and kind of shares as are stated in the Warrant Certificates
initially issuable pursuant to this Agreement.
(n) OTHER DILUTIVE EVENTS
In case any event shall occur as to which the provisions of this
Section 9 are not strictly applicable, but the failure to make any adjustment
would not fairly protect the purchase rights represented by the Warrants in
accordance with the essential intent and principles of this Section 9, then, in
each such case, the Company shall make a good faith adjustment to the Exercise
Price and the Warrant Number in accordance with the intent of this Section 9
and, upon the written request of the holders of a majority of the Warrants,
shall appoint a firm of independent certified public accountants of recognized
national standing (which may be the regular auditors of the Company), which
shall give their opinion upon the adjustment, if any, on a basis consistent with
the essential intent and principles established in this Section 9, necessary to
preserve, without dilution, the purchase rights represented by these Warrants.
Upon receipt of such opinion, the Company shall promptly mail a copy thereof to
the Holder of each Warrant and shall make the adjustments described therein.
(o) MISCELLANEOUS
For the purpose of this Section 9, the term "SHARES OF COMMON STOCK"
shall mean (i) shares of any class of stock designated as Common Stock of the
Company as of the date of this Agreement, (ii) shares of any other class of
stock resulting from successive changes or
Page 13
reclassification of such shares consisting solely of changes in par value, or
from par value to no par value, or from no par value to par value and (iii)
shares of Common Stock of the Company or options, warrants or rights to purchase
Common Stock of the Company or securities convertible into or exchangeable for
shares of Common Stock of the Company outstanding on the date hereof and shares
of Common Stock of the Company issued upon exercise, conversion or exchange of
such options, warrants, rights or securities. In the event that at any time, as
a result of an adjustment made pursuant to this Section 9, the Holders of
Warrants shall become entitled to purchase any securities of the Company other
than, or in addition to, shares of Common Stock, thereafter the number or amount
of such other securities so purchasable upon exercise of each Warrant shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Warrant Shares
contained in subsections (a) through (n) of this Section 9, inclusive, and the
provisions of Sections 5, 6, 8 and 11 with respect to the Warrant Shares or the
Common Stock shall apply on like terms to any such other securities.
SECTION 10. REQUIRED DISTRIBUTIONS. The Company shall not declare,
make or pay any dividend or otherwise distribute to all holders of any class
of its Common Stock (i) any evidences of indebtedness of the Company or any
of its Subsidiaries, (ii) any assets of the Company or any of its
Subsidiaries, or (iii) to the extent an adjustment to the Warrant Number is
not required pursuant to the provisions of Section 9, any rights, options or
warrants to acquire any of the foregoing or to acquire any other securities
of the Company or any of its Subsidiaries, unless it concurrently makes a
cash payment to the holders of the Warrants equal to (x) the amount of cash
or the fair market value (as determined in good faith by the Board of
Directors) of any assets or securities distributed with respect to each
outstanding share of Common Stock, multiplied by (y) the number of shares of
Common Stock then issuable upon exercise of the Warrants.
SECTION 11. FRACTIONAL INTERESTS. The Company shall not be required to
issue fractional Warrant Shares on the exercise of 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 Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this Section 11,
be issuable on the exercise of any Warrants (or specified portion thereof), the
Company may pay (in lieu of the fractional Warrant Share) an amount in cash
equal to the Specified Value of a Warrant Share (determined in accordance with
subsection 9(f) hereof), multiplied by such fraction.
SECTION 12. NOTICES TO WARRANT HOLDERS. Upon any adjustment pursuant to
Section 9 hereof, the Company shall promptly thereafter (i) cause to be prepared
and maintained in the records of the Company a certificate of an officer of the
Company setting forth the Warrant Number and Exercise Price after such
adjustment and setting forth in reasonable detail the method of calculation and
the facts upon which such calculations are based, and (ii) cause to be given to
each of the Holders at its address appearing on the Warrant Register written
notice of such adjustments in accordance with the provisions of Section 13
hereof. Where appropriate, such
Page 14
notice may be given in advance and included as a part of the notice required to
be mailed under the other provisions of this Section 12.
In addition, in case:
(a) the Company shall authorize the issuance to all holders of shares
of Common Stock, rights, options or warrants to subscribe for or purchase shares
of Common Stock, any other subscription rights or warrants;
(b) the Company shall authorize the distribution to all holders of
shares of Common Stock of assets, including cash, evidences of its indebtedness,
or other securities;
(c) of any consolidation or merger to which the Company is a party and
for which approval of any shareholders of the Company is required, or of the
conveyance or transfer of the properties and assets of the Company as an
entirety or substantially as an entirety, or of any reclassification or change
of Common Stock issuable upon exercise of the Warrants (other than a change in
par value, or from par value to no par value, or from no par value to par value,
or as a result of a subdivision or combination), or a tender offer or exchange
offer for shares of Common Stock;
(d) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company;
(e) the Company proposes to take any action that would require an
adjustment to the Warrant Number or the Exercise Price pursuant to Section 9
hereof; or
(f) the Company proposes to take any action which would give rise to
the preemptive rights as specified in Section 14 hereof;
then the Company shall cause to be given to each of the Holders at its address
appearing on the Warrant Register, at least 10 days prior to the applicable
record date hereinafter specified, or to the date of the event in the case of
events for which there is no record date, in accordance with the provisions of
Section 13 hereof, a written notice stating (i) the date as of which the holders
of record of shares of Common Stock to be entitled to receive any such rights,
options, warrants or distribution are to be determined, or (ii) the initial
expiration date set forth in any tender offer or exchange offer for shares of
Common Stock, or (iii) the date on which any such consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up is expected to
become effective or consummated, and the date as of which it is expected that
holders of record of shares of Common Stock shall be entitled to exchange such
shares for securities or other property, if any, deliverable upon such
reclassification, consolidation, merger, conveyance, transfer, dissolution,
liquidation or winding up. The failure to give the notice required by this
Section 12, or any defect therein, shall not affect the legality or validity of
any distribution, right, option, warrant, consolidation, merger, conveyance,
transfer, dissolution, liquidation or winding up, or the vote upon any action.
Page 15
Nothing contained in this Agreement or in any Warrant Certificate shall
be construed as conferring upon the Holders (prior to the exercise of such
Warrants) the right to vote or to consent or to receive notice as shareholder in
respect of the meetings of shareholders or the election of directors of the
Company or any other matter, or any rights whatsoever as shareholders of the
Company; PROVIDED, HOWEVER, that nothing in the foregoing provision is intended
to detract from any rights explicitly granted to any Holder hereunder.
SECTION 13. ADDRESS FOR NOTICES TO THE COMPANY AND WARRANT HOLDERS.
All notices and other communications provided for or permitted hereunder shall
be made by hand-delivery, first-class mail, telex, telecopier, or reputable
overnight air courier promising next day delivery:
(a) if to Purchasers, TCW/Crescent Mezzanine, L.L.C., at ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and
to Gardere & ▇▇▇▇▇, L.L.P., ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.; and
(b) if to the Company, at Pacific Circuits, Inc., ▇▇▇▇▇ ▇.▇. ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Telecopy No. (▇▇▇)▇▇▇-▇▇▇▇, Attention: ▇▇.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, with a copy to Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇; Telecopy No. (▇▇▇)▇▇▇-▇▇▇▇,
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ and to Shearman & Sterling, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇, Attention: ▇▇▇▇ ▇▇▇▇▇▇▇.
(c) if to ▇▇▇▇▇▇ Capital Partners IV, at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇, Telecopy No. (▇▇▇)▇▇▇-▇▇▇▇, Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇; and
(d) if to ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ & Partners, Inc., ▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇.,
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Telecopy No. (▇▇▇)▇▇▇-▇▇▇▇, Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇.
All such notices and communications shall be deemed to have been duly
given:
at the time delivered by hand or by local courier, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back if telexed; when receipt acknowledged, if telecopied; and the
next Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery. A Person may change the addresses to
which notices are to be given by giving five days' prior written notice of such
change in accordance with this Section 13.
SECTION 14. PREEMPTIVE RIGHT.
(a) The Company shall give each Holder written notice of the
Company's intention to issue, sell or distribute Additional Securities (as
defined in Section 14(f) below) (the "ISSUANCE NOTICE"), describing the type of
Additional Securities, the price at which the Additional Securities will be
issued or sold and the general terms upon which the Company proposes to issue,
sell or
Page 16
distribute the Additional Securities, including the anticipated date of such
issuance, sale or distribution and the general use of proceeds thereof.
(b) Each Holder shall have 15 Business Days from the date it
receives the Issuance Notice to agree to purchase all or any portion of its Pro
Rata Portion (as defined in Section 14(e) below) of such Additional Securities
by giving written notice to the Company of its desire to purchase Additional
Securities (the "RESPONSE NOTICE") and stating therein the quantity of
Additional Securities to be purchased. Subject to the last sentence of this
subdivision, such Response Notice shall constitute the irrevocable agreement of
such Holder to purchase the quantity of Additional Securities indicated in the
Response Notice at the price and upon the terms stated in the Issuance Notice;
PROVIDED, HOWEVER, that if the Company is proposing to issue, sell or distribute
Additional Securities for consideration other than all cash, and subject to the
limitations on the rights set forth in Section 14(h), the Company shall accept
from such Holder either non-cash consideration which is reasonably comparable to
the non-cash consideration proposed by the Company or the cash value of such
non-cash consideration. Any purchase by a Holder of Additional Securities shall
be consummated on or prior to the later of the date on which all other
Additional Securities described in the applicable Issuance Notice are issued,
sold or distributed or the tenth Business Day following delivery of the Response
Notice by such Holder. In the event that less than 80% of all Additional
Securities proposed to be sold by the Company, as set forth in the Issuance
Notice, are subscribed for in the aggregate by the Holders (or by third parties
pursuant to Section 14(d) below within 180 days of the date of the Issuance
Notice), the irrevocable agreement of Holders to purchase the Additional
Securities subscribed for shall become fully revocable.
(c) Each Holder shall have the further right to subscribe for such
portion of the Additional Securities to which it may become entitled to purchase
under this Section 14(c). The Response Notice may set forth a number of
Additional Securities ("REALLOTMENT SECURITIES") that such Holder elects to
purchase in the event that there is any undersubscription for the entire amount
of all Holders' Pro Rata Portions of the Additional Securities. In the event
there is an undersubscription by the Holders for any portion of the aggregate
Additional Securities offered, the Company shall apportion the unsubscribed for
Additional Securities to those Holders whose Response Notices specified an
amount of Reallotment Securities, which apportionment shall be on a pro rata
basis among such Holders in accordance with the number of Reallotment Securities
specified by all such Holders in their Response Notices.
(d) The Company shall have 180 days from the date of the Issuance
Notice to consummate the proposed issuance, sale or distribution of the
Additional Securities which the Holders have not elected to purchase pursuant to
Sections 14(b) or (c). Notwithstanding the foregoing, the Company may sell the
Additional Securities which the Holders have not elected to purchase pursuant to
a Response Notice at a price and upon terms that are less favorable to the
Company than those specified in the Issuance Notice; PROVIDED that any purchase
of Additional Securities by the Holders consummated at the time of such sale,
pursuant to the penultimate sentence of Section 14(b), shall be upon the same
less favorable terms; PROVIDED FURTHER that if a Holder did not elect to
purchase any or all of its Pro Rata Portion of Additional Securities based upon
the terms specified in the relevant Issuance Notice, the Company shall provide
such Holder
Page 17
with a revised Issuance Notice reflecting such less favorable terms, and each
such Holder shall have 15 Business Days from the date such Holder receives such
revised Issuance Notice to agree to purchase all or any portion of its Pro Rata
Portion of such Additional Securities to be issued upon the less favorable terms
set forth in the revised Issuance Notice by giving written notice to the Company
of its desire to purchase such Additional Securities and stating therein the
quantity of Additional Securities to be purchased. In the event the Company
proposes to issue, sell or distribute Additional Securities after such 180-day
period or Additional Securities in addition to those specified in the Issuance
Notice, it must again comply with the procedures set forth in this Section 14.
(e) For purposes of this Section 14, "PRO RATA PORTION" means,
with respect to each Holder, a number equal to the product of (i) the total
number of Additional Securities specified in the Issuance Notice and (ii) a
fraction, the numerator of which shall be the number of shares of Common Stock
to which such Holder would be entitled upon exercise of his/its Warrants and the
denominator of which shall be the total number of Fully Diluted Shares (as
defined in Section 14(g) below) outstanding as of the date of the Issuance
Notice.
(f) As used herein, "ADDITIONAL SECURITIES" means all Capital
Stock, rights, options or warrants to purchase Capital Stock and securities of
any type whatsoever convertible into or exchangeable for Capital Stock
(collectively, the "SECURITIES") which are issued by the Company after the date
hereof other than (i) any Securities issued or issuable to all of the holders of
the Common Stock then outstanding on a proportionate basis (based on such
holders' respective ownership of the Common Stock), (ii) any Securities issued
or issuable to any employees, directors and consultants of the Company and the
Subsidiaries of the Company (collectively, "EMPLOYEES") pursuant to any equity
incentive plan, agreement, bonus, award, stock purchase plan, stock option plan
or other stock arrangement with respect to any Employees ("EMPLOYEE PLAN")
approved by the Board of Directors; PROVIDED, HOWEVER, that such exclusion shall
only apply with respect to the issuance of Securities that do not exceed, on an
aggregate basis, 10% of the then total outstanding Common Stock, assuming full
exercise of all Securities granted to Employees, (iii) Securities which are
reissued by the Company to Employees following the repurchase, redemption or
other acquisition of such Securities by the Company from any Employees or any
shareholder, (iv) any Securities issued to any source of, and in connection
with, financing for the Company or any Subsidiary including Securities issuable
upon exercise of the Warrants and (v) any Securities issued pursuant to an IPO.
(g) As used herein, "FULLY DILUTED SHARES" means the aggregate of
(i) the number of shares of Common Stock issued and outstanding (other than
shares of Common Stock held in the treasury of the Company or held by any
Subsidiary) and (ii) the number of shares of Common Stock issuable upon (x) the
exercise of any then exercisable outstanding options, warrants or similar
instruments (other than such instruments held by the Company or any Subsidiary)
and (y) the exercise of any then exercisable conversion or exchange rights, with
respect to any outstanding securities or instruments (other than such securities
or instruments held by the Company or any Subsidiary).
Page 18
(h) In the event the Company grants to any Person rights to
participate in any issuances, sales or distributions of Securities which are
more favorable than the rights granted to the Holders in this Section 14, the
rights granted to the Holders shall be expanded to the extent necessary to make
such rights no less favorable than the rights granted to such other Person;
PROVIDED, HOWEVER, that the foregoing provisions shall not apply to the rights
granted by the Company to any underwriter to acquire Securities to be issued and
sold by the Company in an IPO.
(i) Notwithstanding the foregoing provisions of this Section 14,
the Holders shall not have the right to participate in the issuances of any
Securities made as part of any merger, consolidation, combination, acquisition
of securities of another corporation or purchase of any business or assets for
such securities by or with the Company or any of its Subsidiaries; PROVIDED that
the Board of Directors shall have determined, in its sole discretion, that the
consideration to be received by the Company or such Subsidiary in such issuance
is not less than the Specified Value of the Securities to be issued in such
transaction.
SECTION 15. TAG-ALONG RIGHTS; TAKE-ALONG RIGHTS
(a) TAG-ALONG RIGHTS. So long as Parent and its Affiliates shall
own, in the aggregate, Common Stock representing at least 20% of the then
outstanding Fully Diluted Shares, if at any time Parent shall determine to sell,
transfer or otherwise dispose of any of the Common Stock then held by Parent, to
any other Person or Persons (collectively, if more than one, a "PROSPECTIVE
PURCHASER"), Parent shall cause the Prospective Purchaser to first give written
notice (the "OFFER NOTICE") to all of the Holders, not later than 21 days prior
to the consummation of the sale, transfer or other disposition contemplated by
the Prospective Purchaser, specifying the name and address of the Prospective
Purchaser and the number of shares, if any, of Common Stock proposed to be sold,
transferred or otherwise disposed of and setting forth in reasonable detail the
price, structure and other terms and conditions of the proposed transaction. The
Offer Notice shall constitute the offer (the "OFFER") from the Prospective
Purchaser to each Holder to purchase from such Holder, as a condition to the
consummation of the proposed transaction described in the Offer Notice, at least
such Holder's Pro Rata Portion (as defined below in this Section 15(a)) of the
Warrants on the same terms and conditions (including price and form of
consideration) as are being offered by the Prospective Purchaser to Parent in
the proposed transaction (with each Warrant being treated as a share of Common
Stock). Each Holder shall have 14 days from the date of receipt of the Offer
Notice (as extended until any non-cash consideration is valued) to give written
notice of its intention to accept or reject the Offer. Failure to respond within
such period shall be deemed notice of rejection. In the event that any Holder
gives written notice to the Prospective Purchaser of its intention to accept the
Offer, then such written notice (a "NOTICE OF INTEREST") taken in conjunction
with the Offer Notice, shall constitute a valid and legally binding agreement,
and each of the Holders so giving such written notice shall be entitled to sell
to the Prospective Purchaser, contemporaneously with the consummation of the
proposed transaction, on the same terms and conditions as are being offered by
the Prospective Purchaser to Parent in such transaction (it being understood and
agreed that such terms and conditions do not include the making of any
representations and warranties, indemnities or other similar agreement other
than the representations, warranties and indemnities as to such Holders'
ownership of such
Page 19
Warrants free and clear of all liens, claims and encumbrances and such Holders'
due authority and power to sell such Warrants).
In addition to delivery of Notice of Interest to the Prospective
Purchaser, such Holder shall deliver to Parent (A) the certificate or
certificates evidencing the Warrants to be sold or otherwise disposed of
pursuant to such proposed transaction duly endorsed in blank or accompanied by
written instruments of transfer in form satisfactory to Parent executed by such
Holder, (B) an instrument of assignment reasonably satisfactory to Parent
assigning, as of the consummation of the sale or other disposition to the
Prospective Purchaser, all such Holder's rights under this Agreement with
respect to the Warrants to be sold or otherwise disposed of and (C) a special
irrevocable power-of-attorney authorizing Parent, on behalf of such Holder, to
sell or otherwise dispose of such Warrants pursuant to the terms of the Offer
Notice and to take all such actions as shall be necessary or appropriate in
order to consummate such sale or other disposition. Delivery of such certificate
or certificates evidencing the Warrants to be sold, the instrument of assignment
and the special irrevocable power-of-attorney authorizing Parent, on behalf of
such Holder, to sell or otherwise dispose of such Warrants shall constitute an
irrevocable election by such Holder to authorize and permit Parent to sell such
Warrants, on behalf of such Holder, pursuant to the Offer Notice.
Promptly after the consummation of the sale or other disposition of the
Warrants of the Holders to the Prospective Purchaser pursuant to the Offer
Notice, Parent shall remit to each of the Holders the total sales price of the
Warrants of such Holders sold or otherwise disposed of pursuant thereto.
If, at the end of the 180-day period following the giving of the Offer
Notice, Parent has not completed the sale of all the Warrants with respect to
which Holders shall have given Notices of Interest pursuant to this Section
15(a), Parent shall return to such Holders all certificates evidencing the
unsold Warrants that such Holders delivered for sale or other disposition
pursuant to this Section 15(a) and such Holders' related instruments of
assignment and powers-of-attorney. If such a sale is not completed in such
180-day period, Parent shall again be subject to the terms of this Section 15(a)
with respect to any subsequent transaction.
In the event that a Holder exercises its co-sale rights pursuant to
this Section 15(a) and the Prospective Purchaser is not willing to purchase at
least such Holder's Pro Rata Portion of the Warrants on the same terms and
conditions as specified in the Offer Notice, then Parent shall not be permitted
to transfer or otherwise dispose of any of its Common Stock to the Prospective
Purchaser in such transaction (it being understood and agreed that such terms
and conditions do not include the making of any representations and warranties,
indemnities or other similar agreement other than the representations,
warranties and indemnities as to such Holders' ownership of such Warrants free
and clear of all liens, claims and encumbrances and such Holders' due authority
and power to sell such Warrants).
For purposes of this Section 15(a), "PRO RATA PORTION" means, with
respect to each Holder, a number equal to the product of (i) the total number of
Warrants then owned by such Holder and (ii) a fraction, the numerator of which
shall be the total number of shares of Common
Page 20
Stock proposed to be sold by Parent, and the denominator of which shall be the
total number of shares of Common Stock then owned by Parent.
Except as expressly provided in this Section 15(a), Parent shall not
have any obligation to any Holder with respect to the sale or other disposition
of any Warrants owned by such Holder in connection with this Section 15(a).
Anything herein to the contrary notwithstanding and irrespective of whether any
Notice of Interest shall have been given, Parent shall not have any obligation
to any Holder to sell or otherwise dispose of any of its Common Stock pursuant
to this Section 15(a) as a result of any decision by Parent not to accept or
consummate any offer or sale or other disposition with respect to Common Stock
(it being understood that any and all such decisions shall be made by Parent in
its sole discretion).
(b) TAKE-ALONG RIGHTS.
So long as Parent and its Affiliates shall own, in the aggregate,
Common Stock representing at least 20% of the then outstanding Fully Diluted
Shares, if Parent shall, in any transaction or series of related transactions,
directly or indirectly, propose to sell all shares of Common Stock held by it
(for purposes of this Section 15(b), the "CONTROLLING SHARES") to a Prospective
Purchaser other than an Affiliate of Parent (for purposes of this Section 15(b),
an "OFFER") and as a result of such sale such Prospective Purchaser and its
Affiliates would own a majority of the then outstanding Fully Diluted Shares,
Parent may, at its option, require each Holder to sell all Warrants owned or
held by such Holder to the Prospective Purchaser for the same consideration per
share of Common Stock and otherwise on the same terms and conditions upon which
Parent sells its shares of Common Stock (with each Warrant being treated as a
share of Common Stock).
Parent shall provide a written notice (for purposes of this Section
15(b), the "OFFER NOTICE") of such Offer to each Holder not later than the tenth
Business Day prior to the consummation of the sale contemplated by the Offer.
The Offer Notice shall contain written notice of the exercise of Parent' rights
pursuant to Section 15(b), setting forth the consideration per share of Common
Stock to be paid by the Prospective Purchaser and the other material terms and
conditions of the Offer. Within 10 Business Days following the date the Offer
Notice is given, each Holder shall deliver to Parent (A) the certificate or
certificates evidencing all the Warrants owned or held by such Holder duly
endorsed in blank or accompanied by written instruments of transfer in form
satisfactory to Parent executed by such Holder, and (B) a special irrevocable
power-of-attorney authorizing Parent, on behalf of such Holder, to sell or
otherwise dispose of such Warrants pursuant to the terms of the Offer and to
take all such actions as shall be necessary or appropriate in order to
consummate such sale or disposition.
Promptly after the consummation of the sale of Warrants of the Holders
to the Prospective Purchaser pursuant to the Offer, Parent shall remit to each
Holder the total sales price of the Warrants of such Holder sold pursuant
thereto less a pro rata portion of the reasonable fees and expenses (including,
without limitation, legal expenses) incurred by Parent in connection with such
sale, PROVIDED, THAT, fees payable by the Holder in connection with such sale
shall not include the Holder's pro rata share of any fees payable to the
Sponsors, in connection with such sale, to
Page 21
the extent the aggregate fees paid to the Sponsors in connection with such sale
exceed one percent (1%) of the aggregate proceeds of such sale and provided no
other investment banking fees are being paid to any third party.
If, at the end of the 180-day period following the giving of the Offer
Notice, Parent shall not have completed the sale of all the Controlling Shares
and the Warrants delivered to Parent pursuant to this Section 15(b), Parent
shall return to each of the Holders all certificates evidencing unsold Warrants
that such Holder delivered for sale pursuant to this Section 15(b) and such
Holders' related powers-of-attorney and the provisions of this Section 15(b)
shall no longer apply to the sale in the Offer Notice.
Except as expressly provided in this Section 15(b), Parent shall have
no obligation to any Holder with respect to the sale or other disposition of any
Warrants owned by such Holder in connection with this Section 15(b). Anything
herein to the contrary notwithstanding, Parent shall have no obligation to any
Holder to sell or otherwise dispose of any Controlling Shares pursuant to this
Section 15(b) as a result of any decision by Parent not to accept or consummate
any Offer or sale with respect to the Controlling Shares (it being understood
that any and all such decisions shall be made by Parent in its sole discretion).
Nothing in this Section 15(b) shall affect any of the obligations of any Holder
under any other provision of this Agreement.
Anything in this Section 15(b) to the contrary notwithstanding, the
provisions of this Section 15(b) shall not be applicable to any sale of Warrants
pursuant to a public offering.
Anything in this Section 15(b) to the contrary notwithstanding, no
Holder shall be required to make any representations and warranties to any
Person in connection with the sale made pursuant to the Offer except as to (i)
good title and absence of liens with respect to such Holder's Warrants and (ii)
the validity and binding effect of any agreements entered into by such Holder in
connection with such sale. No Holder shall be required to provide any
indemnities in connection with such sale except for a breach of the
representations and warranties described in the immediately foregoing clauses
(i) and (ii).
(c) RIGHT OF FIRST REFUSAL.
If at any time any Holder (a "SELLING HOLDER") shall determine to sell,
transfer or otherwise dispose of any Warrants to any other Person or Persons,
the Selling Holder shall first give written notice (the "RIGHT OF FIRST REFUSAL
NOTICE") to the Company specifying the number and type of Warrants proposed to
be sold, transferred or otherwise disposed, and the name of the prospective
purchaser and setting forth in reasonable detail, the price and other terms and
conditions upon which the Selling Holder proposes to sell such Warrants. The
Right of First Refusal Notice shall offer to sell all such Warrants to the
Company on the same terms and conditions (including price) as are being offered
to the prospective purchaser. In the event that all or any portion of the
consideration shall consist of anything other than cash, the price shall be the
fair market value of such consideration as determined by the Selling Holder in
its reasonable discretion. The Company shall have 30 days from the date of
receipt of the Right of First Refusal Notice to give written notice of its
intention to accept or reject such offer. Failure to respond
Page 22
within such 30-day period shall be deemed notice of rejection. In the event that
the Company notifies the Selling Holder of its intention to accept such offer,
such acceptance notice, taken in conjunction with the Right of First Refusal
Notice shall constitute a valid and legally binding purchase and sale agreement,
and payment in cash shall be made within 30 days following the receipt by the
Selling Holder of such acceptance notice. In the event that the Company rejects
or is deemed to have rejected the offer, the Selling Holder shall be free to
proceed to sell, transfer or otherwise dispose of such Warrants to the
prospective purchaser on the terms and conditions set forth in the Right of
First Refusal Notice. In the event the Selling Holder fails to complete the
proposed sale, transfer or other disposition within 180 days after the Company
has rejected or is deemed to have rejected the offer, such Warrants shall again
be subject to the provisions of this and Section 15(c). Notwithstanding anything
to the contrary set forth in this Section 15(c), the provisions of this Section
15(c) shall not apply to any sale, transfer or other disposition by any Holder
(i) to any Affiliate of such Holder, any other Holder, or the Company, (ii) in
connection with the registration of securities of the Company to which Article
II of the Registration Rights Agreement applies, (iii) pursuant to the
provisions of Section 15(b) of this Agreement, or (iv) in connection or together
with the sale, transfer or other disposition of all or any portion of the Notes
held by such Holder, or (v) any pledge or grant of a security interest by any
Holder of its Warrants to a trustee for the benefit of secured noteholders
pursuant to documents relating to the financing of such Holder; provided,
however, that any foreclosure on such Warrants shall be subject to the
restrictions contained in this Section 15(c).
The Company shall be entitled to assign its rights and delegate its
obligations under and in connection with the foregoing right of first refusal to
Parent, and Parent shall thereupon have the right to exercise all of the rights
of the Company with respect to the purchase of Warrants as to which such rights
are assigned.
As a condition to the transfer of Warrants by any Holder, the
transferee shall be required to become a party to this Agreement and shall
thereupon be deemed a "Holder" for purposes of this Section 15(c).
(d) TERMINATION OF RIGHTS UPON SALE TO THE PUBLIC. Notwithstanding
anything to the contrary set forth herein, (i) all rights of the Company and
Parent under Sections 15(b) and 15(c) hereof shall terminate upon the completion
of an IPO and (ii) all rights of the Holders under Section 15(a) hereof shall
terminate upon the completion of an IPO and the registration of the Warrants or
the Warrant Shares pursuant to an effective registration statement under the
Securities Act of 1933.
SECTION 16. CERTAIN SUPPLEMENTS AND AMENDMENTS. The Company may from
time to time supplement or amend this Agreement without the approval of any
Holders in order to cure any ambiguity or to correct or supplement any provision
contained herein which may be defective or inconsistent with any other provision
herein, or to make any other provisions in regard to matters or questions
arising hereunder which the Company may deem necessary or desirable; PROVIDED
that any such supplement or amendment shall not in any way adversely affect the
interests of the Holders.
Page 23
SECTION 17. SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company shall bind and inure to the
benefit of its successors and permitted assigns hereunder.
SECTION 18. TERMINATION. Except as provided in the following sentence,
this Agreement shall terminate upon the exercise of all Warrants pursuant to
this Agreement. The provisions in Section 15 shall terminate in accordance with
the provisions of such Section.
SECTION 19. GOVERNING LAW; SUBMISSION TO JURISDICTION. The corporation
laws of the State of Washington shall govern all issues concerning the relative
rights of the Company and the Holders. All other questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal law of the State of New York, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of New York. The Company hereby
irrevocably submits to the jurisdiction of any New York State Court or any
Federal court sitting in the Borough of Manhattan in the City of New York in
respect of any suit, action or proceeding arising out of or relating to this
Agreement and the Warrants (and, to the extent of Sections 14 and 15, the
Warrant Shares) and irrevocably accepts for itself and in respect of its
property, generally and unconditionally, jurisdiction of the aforesaid courts.
The Company irrevocably waives, to the fullest extent it may effectively do so
under applicable law, any objection which it may now or hereafter have to the
laying of the venue of any such suit, action or proceeding brought in any such
court and any claim that any such suit, action or proceeding has been brought in
an inconvenient forum. Nothing herein shall affect the right of any Holder or
holder of Warrant Shares to serve process in any other manner permitted by law
or to commence legal proceedings or otherwise proceed against the Company in any
other jurisdiction.
SECTION 20. BENEFITS OF THIS AGREEMENT. Except as set forth in Section
15 hereof, (i) nothing in this Agreement shall be construed to give to any
Person other than the Company and the Holders any legal or equitable right,
remedy or claim under this Agreement, and (ii) this Agreement shall be for the
sole and exclusive benefit of the Company and the Holders (including holders of
Warrant Shares).
SECTION 21. COUNTERPARTS. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.
SECTION 22. AMENDMENTS AND WAIVERS. Subject to Section 16, no provision
of this Agreement may be amended or waived except by an instrument in writing
signed by the party sought to be bound; PROVIDED that any amendment or waiver
sought from the Holders of any provision of this Agreement which affects Holders
or holders of Warrant Shares generally shall be given by Holders of at least a
majority of the Warrants outstanding, with each Warrant representing the right
to one vote and any amendment or waiver so given shall be binding on all
Holders. No failure or delay by any party in exercising any right or remedy
hereunder shall operate as a waiver thereof, and a waiver of a particular right
or remedy on one occasion shall not
Page 24
be deemed a waiver of any other right or remedy or a waiver of the same right or
remedy on any subsequent occasion.
SECTION 23. FAIR MARKET VALUE OF NOTES AND WARRANTS. The Company and
the Purchasers hereby agree that for purposes of IRC Treasury Regulations
Section 1.1273-2(h), (a) the "issue price" of the investment unit consisting of
the Notes and Warrants is $12,500,000, (b) the fair market value of the Notes is
$11,600,000.00 and (c) the fair market value of Warrants is $900,000.00. The
Company and the Purchasers agree to use the foregoing issue price and fair
market value for U.S. federal tax purposes with respect to the transactions
contemplated by this Agreement (unless otherwise required by a final
determination of the Internal Revenue Service or a court of competent
jurisdiction).
[SIGNATURE PAGES FOLLOW]
Page 25
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties set forth below as of the date first written above.
PACIFIC CIRCUITS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
The undersigned executed this Agreement for the purpose of being bound by the
terms of Section 15 hereof:
CIRCUIT HOLDINGS, LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President
PURCHASERS:
TCW/CRESCENT MEZZANINE PARTNERS II, L.P.
TCW/CRESCENT MEZZANINE TRUST II
By: TCW/Crescent Mezzanine II, L.P.,
as general partner or managing owner
By: TCW/Crescent Mezzanine, L.L.C.,
its general partner
By: /s/ ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇
Title: President
ADDRESS FOR NOTICES:
▇/▇ ▇▇▇/▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇.▇.▇.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Phone: 214/▇▇▇-▇▇▇▇
Fax: 214/▇▇▇-▇▇▇▇
TCW LEVERAGED INCOME TRUST, L.P.
By: TCW Advisors (Bermuda), Limited,
as general partner
By: /s/ ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
By: TCW Investment Management Company,
as Investment Advisor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
ADDRESS FOR NOTICES:
▇/▇ ▇▇▇/▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇.▇.▇.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Phone: 214/▇▇▇-▇▇▇▇
Fax: 214/▇▇▇-▇▇▇▇
TCW LEVERAGED INCOME TRUST II, L.P.
By: TCW (▇▇▇▇ ▇▇), L.P.,
as general partner
By: TCW Advisors (Bermuda), Ltd.,
as general partner
By: /s/ ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇-▇▇▇▇ ▇▇▇▇▇▇
Title: Managing Director
By: TCW Investment Management Company,
as Investment Advisor
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
ADDRESS FOR NOTICES:
▇/▇ ▇▇▇/▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇.▇.▇.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Phone: 214/▇▇▇-▇▇▇▇
Fax: 214/▇▇▇-▇▇▇▇
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED ON JULY
[_], 1999, AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A WARRANT
AGREEMENT AND A SECURITIES PURCHASE AGREEMENT, EACH DATED AS OF JULY [_], 1999,
AMONG THE ISSUER OF SUCH SECURITIES (THE "COMPANY"), THE PURCHASERS REFERRED TO
THEREIN AND THE OTHER PARTIES THERETO. THE TRANSFER OF THIS CERTIFICATE IS
SUBJECT TO THE CONDITIONS SPECIFIED IN SUCH AGREEMENTS AND THE COMPANY RESERVES
THE RIGHT TO REFUSE THE TRANSFER OF THIS CERTIFICATE UNLESS SUCH CONDITIONS HAVE
BEEN FULFILLED WITH RESPECT TO SUCH TRANSFER. A COPY OF SUCH AGREEMENTS WILL BE
FURNISHED WITHOUT CHARGE BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN
REQUEST.
THE SHARES ISSUABLE UPON EXERCISE OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO THE PREFERENCES, POWERS, QUALIFICATIONS AND RIGHTS OF
EACH CLASS AND SERIES OF CAPITAL STOCK OF THE COMPANY SET FORTH IN THE COMPANY'S
ARTICLES OF INCORPORATION. THE COMPANY WILL FURNISH A COPY OF SUCH ARTICLES OF
INCORPORATION TO THE HOLDER OF THIS CERTIFICATE, WITHOUT CHARGE, UPON WRITTEN
REQUEST.
No: Warrants
------- ------
Warrant Certificate
PACIFIC CIRCUITS, INC.
This Warrant Certificate certifies that ________________ or registered assigns,
is the registered holder (the "HOLDER") of the number of Warrants (the
"WARRANTS") set forth above to purchase common stock, no par value per share
(the "COMMON STOCK"), of Pacific Circuits, Inc., a Washington corporation (the
"Company"). Each Warrant entitles Holder to receive from the Company one fully
paid and nonassessable share of Common Stock (a "WARRANT SHARE"), at the initial
exercise price (the "EXERCISE PRICE") of $ 0.01, payable in lawful money of the
United States of America, upon exercise by surrender of this Warrant Certificate
and payment of the Exercise Price at the office of the Company designated for
such purpose, but only subject to the conditions set forth herein and in the
Warrant Agreement referred to hereinafter. The Exercise Price and
number of Warrant Shares issuable upon exercise of the Warrants are subject to
adjustment upon the occurrence of certain events, as set forth in the Warrant
Agreement.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants, and are issued or to be issued pursuant to a
Warrant Agreement dated as of July [_], 1999 (the "WARRANT AGREEMENT"), duly
executed and delivered by the Company, which Warrant Agreement is hereby
incorporated by reference in and made a part of this instrument and is hereby
referred to for a description of the rights, limitation of rights, obligations,
duties and immunities thereunder of the Company and the holders (the words
"HOLDERS" or "HOLDER" meaning the registered holders or registered holder) of
the Warrants. A copy of the Warrant Agreement may be obtained by the Holder
hereof upon written request to the Company.
The Holder may exercise the Warrants evidenced by this Warrant
Certificate under and pursuant to the terms and conditions of the Warrant
Agreement by surrendering this Warrant Certificate, with the form of election to
purchase set forth hereon (and by this reference made a part hereof) properly
completed and executed, together with payment of the Exercise Price in cash or
by certified or bank check at the office of the Company designated for such
purpose. In the alternative, the Holder may exercise through an Offset Exercise
(as defined in the Warrant Agreement) or Net Exercise (as defined in the Warrant
Agreement) in accordance with the terms of Section 5 of the Warrant Agreement.
In the event that upon any exercise of Warrants evidenced hereby the number of
Warrants exercised shall be less than the total number of Warrants evidenced
hereby, there shall be issued by the Company to the Holder or its registered
assignee a new Warrant Certificate evidencing the number of Warrants not
exercised.
The Warrant Agreement provides that upon the occurrence of certain
events the number of Warrant Shares issuable upon exercise of a Warrant and the
Exercise Price set forth on the face hereof may, subject to certain conditions,
be adjusted.
The Holder will have certain registration rights and other rights and
obligations with respect to the Warrant Shares as provided in the Registration
Rights Agreement dated as of July [_], 1999 by and among the Company and the
other persons party thereto (the "REGISTRATION RIGHTS AGREEMENT"). Copies of the
Registration Rights Agreement may be obtained by the Holder, without charge,
upon written request to the Company.
This Warrant Certificate, when surrendered at the office of the Company
by the Holder in person or by legal representative or attorney duly authorized
in writing, may be exchanged, in the manner and subject to the limitations
provided in the Warrant Agreement, but without payment of any service charge,
for another Warrant Certificate or Warrant Certificates of like tenor evidencing
in the aggregate a like number of Warrants.
Subject to the terms and conditions of the Warrant Agreement, upon due
presentation for registration of transfer of this Warrant Certificate at the
office of the Company a new Warrant Certificate or Warrant Certificates of like
tenor and evidencing in the aggregate a like number of Warrants shall be issued
to the transferee(s) in exchange for this Warrant Certificate, subject to
the limitations provided in the Warrant Agreement, without charge (except for
any tax or other governmental charge imposed in connection therewith as
described in the Warrant Agreement).
The Company may deem and treat the Holder as the absolute owner of this
Warrant Certificate (notwithstanding any notation of ownership or other writing
hereon made by anyone) for the purpose of any exercise hereof, of any
distribution to the Holder, and for all other purposes, and the Company shall
not be affected by any notice to the contrary. Neither the Warrants nor this
Warrant Certificate entitles the Holder to any rights of a stockholder of the
Company evidenced hereby before exercise of one or more of the Warrants
evidenced hereby.
The Holder, by the acceptance hereof, represents that he, she or it is
acquiring this warrant for his, her or its own account for investment and not
with a view to, or sale in connection with, any distribution in violation of the
Securities Act or of any of the shares of Common Stock or other securities
issuable upon the exercise thereof, nor with any present intention of
distributing any of the same in violation of the Securities Act.
IN WITNESS WHEREOF, Pacific Circuits, Inc. has caused this Warrant
Certificate to be signed by its Chairman of the Board, Chief Executive Officer,
President or Vice President.
Dated: July [__], ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, INC.
By: _____________________________
Name: ___________________________
Title: __________________________
FORM OF ELECTION TO PURCHASE
(To Be Executed Upon Exercise of Warrant)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to receive ________ shares of Common
Stock and [HEREWITH TENDERS PAYMENT FOR SUCH SHARES TO THE ORDER OF [COMPANY]
IN THE AMOUNT OF $_______ IN ACCORDANCE WITH THE TERMS HEREOF.] [ELECTS TO
MAKE AN OFFSET EXERCISE] [ELECTS TO MAKE A NET EXERCISE]
The undersigned requests that a certificate for such shares be
registered in the name of ______________ whose address is ______________ and
that such name of shares be delivered to ____________________ whose address
is ________________.
If said number of shares is less than all of the shares of Common
Stock purchasable hereunder, the undersigned requests that a new Warrant
Certificate representing the remaining balance of such shares be registered
in the name of _________________, whose address is _______________ and that
such Warrant Certificate be delivered to _____________ whose address is
_______________ .
Signature(s): ______________________________________________
NOTE: The above signature(s) must correspond with the name
written upon the face of this Warrant Certificate in
every particular, without alteration or enlargement or
any change whatever. If this Warrant is held of record
by two or more joint owners, all such owners must sign.
Date: ___________________________________
Signature Guaranteed[*]
*NOTICE: The signature must be guaranteed by an institution which is a
member of one of the following recognized signature guarantee
program:
(1) The Securities Transfer Agent Medallion Program
(STAMP);
(2) The New York Stock Exchange Medallion Program (MSP);
(3) The Stock Exchange Medallion Program (SEMP).
FORM OF ASSIGNMENT
(To be signed only upon assignment of Warrant Certificate)
FOR VALUE RECEIVED, _____________________ hereby sells, assigns and
transfers unto _______________ whose address is _________________________ and
whose social security number or other identifying number is ________________,
the within Warrant Certificate, together with all right, title and interest
therein and to the Warrants represented thereby, and does hereby irrevocably
constitute and appoint ____________________ , attorney, to transfer said
Warrant Certificate on the books of the within-named Company, with full power
of substitution in the premises.
Signature(s): ______________________________________________
NOTE: The above signature(s) must correspond with the name
written upon the face of this Warrant Certificate in
every particular, without alteration or enlargement or
any change whatever. If this Warrant is held of record
by two or more joint owners, all such owners must sign.
Date: ___________________________
Signature Guaranteed
*NOTICE: The signature must be guaranteed by an institution which is a
member of one of the following recognized signature guarantee
program:
(1) The Securities Transfer Agent Medallion Program
(STAMP);
(2) The New York Stock Exchange Medallion Program (MSP)
(3) The Stock Exchange Medallion Program (SEMP).