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EXHIBIT 10.25
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD OR OFFERED
FOR SALE EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AS TO
THE SECURITIES UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES LAWS
OR AN APPLICABLE EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS.
Right to Purchase Shares of Common Stock
of MRV Communications, Inc.
_________________________
Common Stock Purchase Warrant
MRV Communications, Inc., a Delaware corporation having an address at
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certifies that for $10.00 and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, ___________________,
having an address at ________________________ ("Purchaser"), or any other
Warrant Holder is entitled, on the terms and conditions set forth below, to
purchase from the Company at any time after ______________, 1996 and ending
thirty-six (36) months after _____________, 1996, _________ fully paid and
nonassessable shares of Common Stock, $0.0034 par value, of the Company (the
"Common Stock") at the Purchase Price (hereinafter defined), as the same may be
adjusted pursuant to Section 5 herein.
1. Definitions.
(a) the term "Warrant Holder" shall mean the
Purchaser or any assignee of all or any portion of
this Warrant at any given time who, at the time of
assignment, acquired the right to purchase at least
1000 Warrant Shares, (such number being subject to
adjustment after the date hereof pursuant to Section
5 herein.)
(b) the term "Warrant Shares" shall mean the Shares
of Common Stock or other securities issuable upon
exercise of this Warrant.
(c) the term "Purchase Price" shall mean $26.75.
(d) other terms used herein which are defined in the
Convertible Securities Subscription Agreement (the
"Agreement") or the Registration Rights Agreement
(the "Registration Rights Agreement"), both of even
date and delivery between the Company and the
Purchaser, or in the Debentures issued by the Company
to the Purchaser pursuant to the Agreement (the
"Debentures"), shall have the same meanings herein as
therein.
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2. Exercise of Warrant.
This Warrant may be exercised by the Warrant Holder, in whole or in
part, at any time and from time to time by surrender of this Warrant, together
with the form of subscription at the end hereof duly executed by Warrant
Holder, to the Company at its principal office. In the event that the Warrant
is not exercised in full, the number of Warrant Shares shall be reduced by the
number of such Warrant Shares for which this Warrant is exercised, and the
Company, at its expense, shall forthwith issue and deliver to or upon the order
of Warrant Holder a new Warrant of like tenor in the name of Warrant Holder or
as Warrant Holder (upon payment by Warrant Holder of any applicable transfer
taxes) may request, reflecting such adjusted Warrant Shares.
3. Delivery of Stock Certificates.
(a) Subject to the terms and conditions of this
Warrant, as soon as practicable after the exercise of this Warrant in full or
in part, and in any event within two (2) days thereafter, the Company at its
expense (including, without limitation, the payment by it of any applicable
issue taxes) will cause to be issued in the name of and delivered to Warrant
Holder, or as Warrant Holder (upon payment by Warrant Holder of any applicable
transfer taxes) may lawfully direct, a certificate or certificates for the
number of fully paid and non-assessable shares of Common Stock to which Warrant
Holder shall be entitled on such exercise, together with any other stock or
other securities or property (including cash, where applicable) to which
Warrant Holder is entitled upon such exercise.
(b) This Warrant may not be exercised as to
fractional shares of Common Stock. In the event that the exercise of this
Warrant, in full or in part, would result in the issuance of any fractional
share of Common Stock, then in such event Warrant Holder shall be entitled to
cash equal to the fair market value of such fractional share. For purposes of
this Warrant, fair market value shall equal the closing trading price of the
Common Stock on the Nasdaq Stock Market, the American Stock Exchange or the New
York Stock Exchange, whichever is the principal trading exchange or market for
the Common Stock (the "Principal Market") on the date of determination or, if
the Common Stock is not listed or admitted to trading on any national
securities exchange or quoted in the Nasdaq Stock Market, the average of the
closing bid and asked prices on the over-the-counter market as furnished by any
New York Stock Exchange member firm reasonably selected from time to time by
the Company for that purpose, or, if the Common Stock is not listed or admitted
to trading on any national securities exchange or quoted on the Nasdaq Stock
Market or traded over-the-counter and the average price cannot be determined a
contemplated above, the fair market value of the Common Stock shall be as
reasonably determined in good faith by the Company's Board of Directors.
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4. Covenants Of the Company.
(a) The Company shall use its reasonable best
efforts to insure that a Registration Statement under the Act covering the
issuance of the Warrant Shares and the resale or other disposition thereof by
Warrant Holder is effective as provided in the Registration Rights Agreement.
(b) The Company shall take all necessary action
and proceedings as may be required and permitted by applicable law, rule and
regulation, including, without limitation the notification of the Nasdaq Stock
Market, for the legal and valid issuance of this Warrant and the Warrant Shares
to the Warrant Holder under this Warrant.
(c) From the date hereof through the last date on
which this Warrant is exercisable, the Company shall take all steps reasonably
necessary and within its control to insure that the Common Stock remains listed
on the Principal Market and shall not amend its Certificate of Incorporation or
Bylaws so as to adversely affect any rights of the Warrant Holder under this
Warrant.
(d) The Company shall at all times reserve and
keep available, solely for issuance and delivery as Warrant Shares hereunder,
such shares of Common Stock as shall from time to time be issuable as Warrant
Shares.
(e) The Warrant Shares, when issued in accordance
with the terms hereof, will be duly authorized and, when paid for or issued in
accordance with the terms hereof, shall be validly issued, fully paid and
non-assessable. The Company has authorized and reserved for issuance to
Warrant Holder the requisite number of shares of Common Stock to be issued
pursuant to this Warrant.
(f) With a view to making available to Warrant
Holder the benefits of Rule 144 promulgated under the Act and any other rule or
regulation of the SEC that may at any time permit Warrant Holder to sell
securities of the Company to the public without registration, the Company
agrees to use its reasonable best efforts to:
(i) make and keep public information available,
as those terms are understood and defined in Rule 144, at all times;
(ii) file with the SEC in a timely manner
all reports and other documents required of the Company under the Act
and the Exchange Act; and
(iii) furnish to any Warrant Holder
forthwith upon request a written statement by the Company that it has
complied with the reporting requirements of Rule 144 and of the Act
and the Exchange Act, a copy of the most recent annual or quarterly
report of the Company, and such other reports and documents so filed
by the Company as may be reasonably requested to permit any such
Warrant Holder to take advantage of any rule or regulation of the SEC
permitting the selling of any such securities without registration.
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5. Adjustment of Exercise Price and Number of Shares.
The number of and kind of securities purchasable upon exercise of this Warrant
and the Purchase Price shall be subject to adjustment from time to time as
follows:
(a) Subdivisions, Combinations and Other
Issuances. If the Company shall at any time after the date hereof but prior to
the expiration of this Warrant subdivide its outstanding securities as to which
purchase rights under this Warrant exist, by split-up, spin-off, or otherwise,
or combine its outstanding securities as to which purchase rights under this
Warrant exist, the number of Warrant Shares as to which this Warrant is
exercisable as of the date of such subdivision, split-up, spin-off or
combination shall forthwith be proportionately increased in the case of a
subdivision, or proportionately decreased in the case of a combination.
Appropriate adjustments shall also be made to the purchase price payable per
share, but the aggregate purchase price payable for the total number of Warrant
Shares purchasable under this Warrant as of such date shall remain the same.
(b) Stock Dividend. If at any time after the
date hereof the Company declares a dividend or other distribution on Common
Stock payable in Common Stock or other securities or rights convertible into
Common Stock ("Common Stock Equivalents") without payment of any consideration
by holders of Common Stock for the additional shares of Common Stock or the
Common Stock Equivalents (including the additional shares of Common Stock
issuable upon exercise or conversion thereof), then the number of shares of
Common Stock for which this Warrant may be exercised shall be increased as of
the record date (or the date of such dividend distribution if no record date is
set) for determining which holders of Common Stock shall be entitled to receive
such dividends, in proportion to the increase in the number of outstanding
shares (and shares of Common Stock issuable upon conversion of all such
securities convertible into Common Stock) of Common Stock as a result of such
dividend, and the Purchase Price shall be adjusted so that the aggregate amount
payable for the purchase of all the Warrant Shares issuable hereunder
immediately after the record date (or on the date of such distribution, if
applicable), for such dividend shall equal the aggregate amount so payable
immediately before such record date (or on the date of such distribution, if
applicable).
(c) Other Distributions. If at any time after
the date hereof the Company distributes to holders of its Common Stock, other
than as part of its dissolution, liquidation or the winding up of its affairs,
any shares of its capital stock, any evidence of indebtedness or any of its
assets (other than cash, Common Stock or securities convertible into Common
Stock), then the Company shall decrease the per share Purchase Price of this
Warrant by an appropriate amount based upon the value distributed on each share
of Common Stock as determined in good faith by the Company's Board of
Directors.
(d) Merger, etc. If at any time after the date
hereof there shall be a merger or consolidation of the Company with or into or
a transfer of all or substantially all of the assets of the Company to another
entity, then the Warrant Holder shall be entitled to receive upon such
transfer, merger or consolidation becoming effective, and upon payment of the
aggregate Purchase Price then in effect, the number of shares or other
securities or property of the Company or of the successor corporation resulting
from such merger or consolidation, which would have been received by Warrant
Holder for the shares of stock subject to this Warrant had this Warrant
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been exercised just prior to such transfer, merger or consolidation becoming
effective or to the applicable record date thereof, as the case may be.
(e) Reclassification, Etc. If at any time after
the date hereof there shall be a reorganization or reclassification of the
securities as to which purchase rights under this Warrant exist into the same
or a different number of securities of any other class or classes, then the
Warrant Holder shall thereafter be entitled to receive upon exercise of this
Warrant, during the period specified herein and upon payment of the Purchase
Price then in effect, the number of shares or other securities or property
resulting from such reorganization or reclassification, which would have been
received by the Warrant Holder for the shares of stock subject to this Warrant
had this Warrant at such time been exercised.
(f) Purchase Price Adjustment. In the event that
the Company issues or sells any Common Stock or securities which are
convertible into or exchangeable for its Common Stock or any convertible
securities, or any warrants or other rights to subscribe for or to purchase or
any options for the purchase of its Common Stock or any such convertible
securities (other than issuance of Debentures or of shares of Common Stock upon
conversion thereof, shares or options issued or which may be issued pursuant to
the Company's employee or director option plans or shares issued upon exercise
of options, warrants or rights outstanding on the date of the Agreement and
listed in the Exchange Act Reports) at an effective purchase price per share
which is less than the Purchase Price then in effect or the fair market value
(as hereinabove defined) of the Common Stock on the trading day next preceding
such issue or sale, then in each such case, the Purchase Price in effect
immediately prior to such issue or sale shall be reduced effective concurrently
with such issue or sale to an amount determined by multiplying the Purchase
Price then in effect by a fraction, (x) the numerator of which shall be the sum
of (1) the number of shares of Common Stock outstanding immediately prior to
such issue or sale, including, without duplication, those deemed to have been
issued under any provision of the Debentures and the Warrants plus (2) the
number of shares of Common Stock which the aggregate consideration received by
the Company for such additional shares would purchase at such fair market value
or Purchase Price, as the case may be, then in effect; and (y) the denominator
of which shall be the number of shares of Common Stock of the Company
outstanding immediately after such issue or sale including, without
duplication, those deemed to have been issued under any provision of the
Debentures and Warrants. For purposes of the foregoing fraction, Common Stock
outstanding shall include, without limitation, any Equity Offerings (as defined
in the Debentures) then outstanding, whether or not they are exercisable or
convertible when such fraction is to be determined.
In the event of any such issuance for a consideration which is less
than such fair market value and also less than the Purchase Price then in
effect, then there shall be only one such adjustment by reason of such
issuance, such adjustment to be that which results in the greatest reduction of
the Purchase Price computed as aforesaid. The number of shares which may be
purchased hereunder shall be increased proportionately to any reduction in
Purchase Price pursuant to this paragraph 5(f), so that after such adjustments
the aggregate Purchase Price payable hereunder for the increased number of
shares shall be the same as the aggregate Purchase Price in effect just prior
to such adjustments.
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6. No Impairment. The Company will not, by amendment of
its Certificate of Incorporation or through any reorganization, transfer of
assets, consolidation, merger, dissolution, issue or sale of securities or any
other voluntary action, avoid or seek to avoid the observance or performance of
any of the terms of this Warrant, but will at all times in good faith assist in
the carrying out of all such terms and in the taking of all such action as may
be necessary or appropriate in order to protect the rights of the Warrant
Holder against impairment. Without limiting the generality of the foregoing,
the Company (a) will not increase the par value of any Warrant Shares above the
amount payable therefor on such exercise, and (b) will take all such action as
may be reasonably necessary or appropriate in order that the Company may
validly and legally issue fully paid and nonassessable Warrant Shares on the
exercise of this Warrant.
7. Notice of Adjustments; Notices. Whenever the
Purchase Price or number of Shares purchasable hereunder shall be adjusted
pursuant to Section 5 hereof, the Company shall execute and deliver to the
Warrant Holder a certificate setting forth, in reasonable detail, the event
requiring the adjustment, the amount of the adjustment, the method by which
such adjustment was calculated and the Purchase Price and number of shares
purchasable hereunder after giving effect to such adjustment, and shall cause a
copy of such certificate to be mailed (by first class mail, postage prepaid) to
the Warrant Holder.
8. Rights As Stockholder. Prior to exercise of this
Warrant, the Warrant Holder shall not be entitled to any rights as a
stockholder of the Company with respect to the Warrant Shares, including
(without limitation) the right to vote such shares, receive dividends or other
distributions thereon or be notified of stockholder meetings. However, in the
event of any taking by the Company of a record of the holders of any class of
securities for the purpose of determining the holders thereof who are entitled
to receive any dividend (other than a cash dividend) or other distribution, any
right to subscribe for, purchase or otherwise acquire any shares of stock of
any class or any other securities or property, or to receive any other right,
the Company shall mail to each Warrant Holder, at least 10 days prior to the
date specified therein, a notice specifying the date on which any such record
is to be taken for the purpose of such dividend, distribution or right, and the
amount and character of such dividend, distribution or right.
9. Replacement of Warrant. On receipt of evidence
reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of the Warrant and, in the case of any such loss, theft or
destruction of the Warrant, on delivery of an indemnity agreement or security
reasonably satisfactory in form and amount to the Company or, in the case of
any such mutilation, on surrender and cancellation of such Warrant, the Company
at its expense will execute and deliver, in lieu thereof, a new Warrant of like
tenor.
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10. Specific Enforcement; Consent to Jurisdiction.
(a) The Company and the Warrant Holder
acknowledge and agree that irreparable damage would occur in the event that any
of the provisions of this Warrant were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to prevent or cure
breaches of the provisions of this Warrant and to enforce specifically the
terms and provisions hereof, this being in addition to any other remedy to
which either of them may be entitled by law or equity.
(b) Each of the Company and the Warrant
Holder (i) hereby irrevocably submits to the exclusive jurisdiction of the
United States District Court for the Southern District of New York for the
purposes of any suit, action or proceeding arising out of or relating to this
Warrant and (ii) hereby waives, and agrees not to assert in any such suit,
action or proceeding, any claim that it is not personally subject to the
jurisdiction of such court, that the suit, action or proceeding is brought in
an inconvenient forum or that the venue of the suit, action or proceeding is
improper. Each of the Company and the Warrant Holder consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address in effect for notices to it under this Warrant and agrees
that such service shall constitute good and sufficient service of process and
notice thereof. Nothing in this paragraph shall affect or limit any right to
serve process in any other manner permitted by law.
11. Entire Agreement; Amendments. This Warrant, the
Exhibits hereto and the provisions contained in the Agreement, the Registration
Rights Agreement or the Debentures and incorporated into this Warrant and the
Warrant Shares contain the entire understanding of the parties with respect to
the matters covered hereby and thereby and, except as specifically set forth
herein and therein, neither the Company nor the Warrant Holder makes any
representation, warranty, covenant or undertaking with respect to such matters.
No provision of this Agreement may be waived or amended other than by a written
instrument signed by the party against whom enforcement of any such amendment
or waiver is sought.
12. Restricted Securities. Sections 4.5, 5.1, 5.2 and
5.3 of the Agreement are incorporated herein by reference and hereby made a
part hereof.
13. Notices. Any notice or other communication required
or permitted to be given hereunder shall be in writing and shall be effective
(a) upon hand delivery or delivery by telex (with correct answer back
received), telecopy or facsimile at the address or number designated below (if
delivered on a business day during normal business hours where such notice is
to be received), or the first business day following such delivery (if
delivered other than on a business day during normal business hours where such
notice is to be received) or (b) on the second business day following the date
of mailing by express courier service, fully prepaid, addressed to such
address, or upon actual receipt of such mailing, whichever shall first occur.
The addresses for such communications shall be:
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to the Company:
MRV Communications, Inc.
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Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with copies to:
Freshman, Marantz, Orlanski, ▇▇▇▇▇▇ & ▇▇▇▇▇
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Attn: ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
to the Warrant Holder:
Attn:
Fax:
with copies to:
Promethean Investment Group, L.L.C.
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Attn:
Fax:
Either party hereto may from time to time change its address for notices under
this Section 13 by giving at least 10 days prior written notice of such changed
address to the other party hereto.
14. Miscellaneous. This Warrant and any term hereof may
be changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge
or termination is sought. This Warrant shall be construed and enforced in
accordance with and governed by the laws of the State of New York. The
headings in this Warrant are for purposes of reference only, and shall not
limit or otherwise affect any of the terms hereof. The invalidity or
unenforceability of any provision hereof shall in no way affect the validity or
enforceability of any other provision.
15. Expiration. The right to exercise this Warrant shall
expire thirty-six (36)
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months after _____________, 1996.
[Signatures on next page.]
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Dated: As of _____________, 1996 MRV COMMUNICATIONS, INC.
By: __________________________
Name:
Title:
[CORPORATE SEAL]
Attest:
By:_______________________
Name:
Its:
By: __________________________
Name:
Title:
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FORM OF WARRANT EXERCISE
(TO BE SIGNED ONLY ON EXERCISE OF WARRANT)
TO _________________________
The undersigned, the holder of the within Warrant, hereby irrevocably
elects to exercise this Warrant for, and to purchase thereunder, _________
shares of Common Stock of MRV Communications, Inc., a Delaware corporation (the
"Company"), and herewith makes payment of $__________ therefor, and requests
that the certificates for such shares be issued in the name of, and delivered
to _________________, whose address is __________________.
Dated: _________________________________________
(Signature must conform to name of holder
as specified on the face of the Warrant)
_________________________________________
(Address)
Tax Identification Number:_______________
_____________________
FORM OF ASSIGNMENT
(TO BE SIGNED ONLY ON TRANSFER OF WARRANT)
For value received, the undersigned hereby sells, assigns, and transfers unto
_________________ the right represented by the within Warrant to purchase
_____________ shares of Common stock of MRV Communications, Inc., a __________
corporation, to which the within Warrant relates, and appoints
_________________ Attorney to transfer such right on the books of MRV
Communications, Inc., a Delaware corporation, with full power of substitution
the premises.
Dated: _________________________________________
(Signature must conform to name of holder
as specified on the face of the Warrant)
_________________________________________
(Address)
Signed in the presence of:
____________________________
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