Exhibit 4.2
WAIVER AGREEMENT
BETWEEN HALIFAX FUND, L.P. AND RAMTRON INTERNATIONAL CORPORATION
This Waiver Agreement (this "Agreement"), dated as of August 18, 2003 (the
"Effective Date"), is by and between Halifax Fund, L.P. (the "Purchaser")
and Ramtron International Corporation, a Delaware corporation (the
"Company").
The Purchaser and the Company entered into a Securities Purchase Agreement,
dated as of March 14, 2002 (as amended, the "Securities Purchase
Agreement"), pursuant to which the Company issued to the Purchaser a 5%
Secured Convertible Debenture (the "Debenture") and a Warrant to purchase
common stock of the Company (the "Warrant"). Capitalized terms used herein
and not otherwise defined shall have the respective meanings set forth in
the Securities Purchase Agreement and the Debenture, as applicable.
An Event of Default has occurred under Section 6(d)(ix) of the Debenture as
of July 30, 2003 (the "Existing EBITDA Event of Default") and, accordingly,
the Company has asked the Purchaser to waive its rights with respect to such
Event of Default, including its right to effect a Mandatory Redemption, upon
the terms and subject to the conditions set forth in this Agreement.
The parties hereby agree as follows:
1. Waiver.
(a) In consideration of the performance by the Company of its
obligations hereunder, the Purchaser agrees to waive the Existing EBITDA
Event of Default, and to refrain from exercising all rights and remedies
under the Securities Purchase Agreement or the Debenture that would
otherwise be available to it with respect to the Existing EBITDA Event of
Default or any other Event of Default arising under Section 6(d)(ix) of the
Debenture (the "Waiver"); provided; however, that the Waiver shall be
effective only with respect to EBITDA Target Periods that occur on or before
December 31, 2003 (the "Waiver Expiration Date"). For the avoidance of
doubt, the parties acknowledge that the Waiver shall not apply to any Event
of Default arising under Section 6(d)(ix) of the Debenture (each, an "EBITDA
Event of Default"), including without limitation the Existing EBITDA Event
of Default, to the extent that it relates to an EBITDA Target Period
occurring after the Waiver Expiration Date. The Waiver shall not constitute
a waiver of any event, condition, term or provision of or under the
Securities Purchase Agreement or the Debenture other than the Existing
EBITDA Event of Default or any other EBITDA Event of Default to the extent,
in either such case, that it relates to the EBITDA Target Periods specified
above, regardless of whether such event or condition exists as of the
Effective Date or in the future. Other than the provisions expressly
waived hereby, the Securities Purchase Agreement and the Debenture shall
remain in full force and effect, and the Purchaser reserves all of its
rights and remedies thereunder.
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(b) In the event that the Company fails (i) to make a Waiver Payment
(as defined in paragraph 2(a) below) when such payment is due or (ii) to
fulfill any of its other obligations under this Agreement in accordance with
the terms hereof, upon delivery of written notice thereof from the Purchaser
to the Company (a "Termination Notice"), the Waiver will terminate ab initio
and the Purchaser will regain all of its rights and remedies under the
Securities Purchase Agreement and the Debenture with respect to all EBITDA
Events of Default, including without limitation, the Purchaser's right to
effect a Mandatory Redemption under the Debenture at any time following
delivery of the Termination Notice, without regard to whether the Existing
BITDA Event of Default, or any other EBITDA Event of Default, is then
continuing.
2. Waiver Payments; Amendment to Warrant Terms. As an inducement for and
in consideration of the execution and delivery of this Agreement by the
Purchaser, the Company agrees that:
(a) The Company shall pay to the Purchaser, by wire transfer in
immediately available funds to such account or accounts as may be designated
by the Purchaser, the following amounts on the respective dates indicated:
(i) $400,000 on the Effective Date;
(ii) $300,000 on or before December 31, 2003; and
(iii) $125,000 on each of the following dates: March 31, 2004,
June 30, 2004, September 30, 2004 and December 31, 2004.
Upon payment of each such amount to the Purchaser, the Company shall also
pay to the Purchaser the amount of unpaid interest accrued on such amount in
accordance with the terms of the Debenture. Each payment specified in this
paragraph 2(a), including the unpaid interest accrued thereon, is referred
to herein as a "Waiver Payment". The Company agrees that its obligation to
make Waiver Payments is unconditional and absolute regardless of the
expiration or termination of the Waiver; provided, however, that the
Purchaser shall have the right, exercisable in its sole discretion upon
written notice to the Company delivered prior to the applicable payment date
for a Waiver Payment, to waive such Waiver Payment, in which event (x) the
Company shall have no further obligation or right to make such Waiver
Payment and (y) the amount owed under the Debenture shall not be reduced by
the amount of such Waiver Payment. Interest at the Default Interest Rate
shall accrue on the amount of any Waiver Payment that is not paid when due
or waived by the Purchaser.
(b) The Warrant is hereby amended so that, from and after the Effective
Date, (i) the Expiration Date shall be the sixth (6th) anniversary of the
Issue Date, and (ii) the Exercise Price shall be equal to 150% of the
average Closing Bid Price for the Common Stock during the period of five (5)
Trading Days immediately preceding the Effective Date, but not greater than
$3.76 (subject to adjustment as provided in the Warrant). Other than as
amended hereby, the Warrant will remain in full force and effect. The
Company agrees that such amendments to the Warrant shall remain effective
regardless of the expiration or termination of the Waiver.
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3. Stock Payment Option.
(a) In the event that the Company fails to make a Waiver Payment on the
date on which such payment is due, the Purchaser may at any time thereafter,
in lieu of delivering a Termination Notice to the Company, convert the
amount of such Waiver Payment into Common Stock (the "Stock Payment
Option"). In order to exercise the Stock Payment Option, the Purchaser
must deliver a written notice to the Company (a "Stock Payment Notice")
stating its intention to do so. Following delivery of the Stock Payment
Notice, the Purchaser shall have the right, at any time and from time to
time during the period of sixty (60) Trading Days following the date of the
Stock Payment Notice, to convert all or a portion of such Waiver Payment
into shares of Common Stock (the "Stock Option Shares") by delivering to the
Company, prior to 7:00 p.m., eastern time, on each day on which the
Purchaser wishes to convert a Waiver Payment (or portion thereof), a written
notice to such effect (a "Waiver Payment Conversion Notice"). The number of
Stock Option Shares issuable to the Purchaser upon each such conversion
shall be determined by dividing the amount of such Waiver Payment being
converted by the lower of (i) the Applicable VWAP (as defined below) and
(ii) the Conversion Price then in effect. Each Waiver Payment Conversion
Notice must specify the amount of the Waiver Payment (including any default
interest) being converted, the Applicable VWAP, and the number of Stock
Option Shares issuable to the Purchaser. Upon delivery of a Waiver Payment
Conversion Notice, the Company shall deliver to the Purchaser, no later than
the close of business on the fifth (5th) Business Day following the date of
the Waiver Payment Conversion Notice, the number of Stock Option Shares
specified therein in accordance with the delivery procedures described in
Section 3(d) of the Debenture. The Purchaser may rescind a Stock Payment
Notice at any time with respect to the unconverted portion of a Waiver
Payment in the event of a breach of this Agreement, the Securities Purchase
Agreement or the Debenture (other than any breach that is expressly waived
pursuant to this Agreement), in which case the Purchaser shall regain the
right, in its sole discretion and exercisable at any time, either to deliver
a replacement Stock Payment Notice with respect to such Waiver Payment or to
deliver a Termination Notice. If any issuance of Stock Option Shares would
create a fractional share, such fractional share shall be disregarded and
the number of Stock Option Shares issuable shall be the next higher whole
number of shares.
(b) In no event shall the Purchaser be permitted to deliver a Waiver
Payment Conversion Notice to the extent that the number of Stock Option
Shares issuable thereby to the Purchaser would, when added to the number of
shares of Common Stock beneficially owned by the Purchaser (other than
Common Stock which may be deemed beneficially owned except for being subject
to a limitation on conversion or exercise analogous to the limitation
contained in this paragraph 3(b)), exceed 9.9% of the number of shares of
Common Stock then issued and outstanding. Nothing contained herein shall be
deemed to restrict the right of the Purchaser to deliver a Waiver Payment
Conversion Notice at such time as such conversion will not violate the
provisions of this paragraph 3(b). As used herein, beneficial ownership
shall be determined in accordance with Section 13(d) of the Exchange Act,
and the rules thereunder.
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(c) All Stock Option Shares issued pursuant to the Stock Payment Option
shall be deemed to constitute, immediately upon issuance thereof,
Registrable Securities (as defined in the Registration Rights Agreement) for
all purposes under the Registration Rights Agreement, including without
limitation, Section 4(k) thereof. The Company agrees that, in addition to
its obligations under the Registration Rights Agreement, it will, within
fifteen (15) Business Days following the Effective Date, file an amendment
to the Registration Statement that will permit the resale thereunder of all
Stock Option Shares issued pursuant to the Stock Payment Option. The
Company acknowledges that the Stock Option Shares, upon issuance thereof to
the Purchaser in accordance with the terms hereof, will be deemed to have
been held continuously by the Purchaser, for purposes of Rule 144 under the
Securities Act, during the period beginning on the date on which the
Debenture was issued to the Purchaser through the date of such issuance.
(d) For purposes hereof, "Applicable VWAP" means, on any day, ninety
percent (90%) of the daily VWAP for such day, if such day is a Trading Day
or, if such day is not a Trading Day, for the immediately preceding Trading
Day.
4. Notices. Any notice, demand or request required or permitted to be
given by the Company or the Purchaser pursuant to the terms of this
Agreement shall be in writing and shall be deemed delivered (i) when
delivered personally or by verifiable facsimile transmission, unless such
delivery is made on a day that is not a Business Day, in which case such
delivery will be deemed to be made on the next succeeding Business Day, (ii)
on the next Business Day after timely delivery to an overnight courier and
(iii) on the Business Day actually received if deposited in the U.S. mail
(certified or registered mail, return receipt requested, postage prepaid),
addressed as described in the Securities Purchase Agreement.
5. Entire Agreement; Amendments. This Agreement, together with the
Securities Purchase Agreement, Debenture and Warrant, constitutes the entire
agreement between the parties with regard to the subject matter hereof,
superseding all prior agreements or understandings, whether written or oral,
between the parties. Except as expressly provided herein, neither this
Agreement nor any term hereof may be amended except pursuant to a written
instrument executed by the Company and the Purchaser, and no provision
hereof may be waived other than by a written instrument signed by the party
against whom enforcement of any such waiver is sought.
6. Successors and Assigns. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors
and permitted assigns of the parties. Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto
or their respective successors and permitted assigns any rights, remedies,
obligations or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement. The Purchaser may assign its rights
and obligations hereunder, in connection with any private sale or transfer
of a Debenture or Warrant (or part thereof) in accordance with the terms
hereof, as long as, as a condition precedent to such transfer, the
transferee executes an acknowledgment agreeing to be bound by the applicable
provisions of this Agreement, in which case the term "Purchaser" shall be
deemed to refer to such transferee as though such transferee were an
original signatory hereto. The Company may not assign it rights or
obligations under this Agreement.
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7. Independent Nature of Purchaser's Rights and Obligations. The parties
acknowledge that the Company may enter into waiver agreements substantially
similar to this Agreement with other holders of Debentures or Warrants
("Other Agreements"), and that the Other Agreements have been negotiated
separately and independently. Nothing contained herein or in any Other
Agreement, and no action taken by the Company, the Purchaser or any such
holder pursuant hereto or thereto, shall be deemed to constitute the
Purchaser and any such holder as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the
Purchaser and any such holder are in any way acting in concert with respect
to such obligations or the transactions contemplated by this Agreement. The
Company agrees that if, at any time, the terms of any Other Agreement offer
to a holder economic benefits that are materially better than those provided
to the Purchaser under this Agreement, the Company must notify the Purchaser
of such terms and provide the Purchaser with the right to include such terms
in this Agreement.
8. Injunctive Relief. The Company acknowledges and agrees that a breach by
it of its obligations hereunder will cause irreparable harm to the Purchaser
and that the remedy or remedies at law for any such breach will be
inadequate and agrees, in the event of any such breach, in addition to all
other available remedies, the Purchaser shall be entitled to an injunction
restraining any breach and requiring immediate and specific performance of
such obligations without the necessity of showing economic loss.
9. Governing Law; Jurisdiction. This Agreement shall be governed by and
construed under the laws of the State of New York applicable to contracts
made and to be performed entirely within the State of New York. Each party
hereby irrevocably submits to the non-exclusive jurisdiction of the state
and federal courts sitting in the City of New York, borough of Manhattan,
for the adjudication of any dispute hereunder or in connection herewith or
with any transaction contemplated hereby or discussed herein, and hereby
irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction
of any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process
and 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 Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof. Nothing
contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law.
10. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
11. Headings. The headings used in this Agreement are used for convenience
only and are not to be considered in construing or interpreting this
Agreement.
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12. Usage. All definitions contained in this Agreement are equally
applicable to the singular and plural forms of the terms defined. The words
"hereof", "herein" and "hereunder" and words of similar import referring to
this Agreement refer to this Agreement as a whole and not to any particular
provision of this Agreement.
13. Transfer of Interest. The Purchaser represents that it has not
transferred to a third party any interest in the Warrant or the Debenture
issued to it under the Securities Purchase Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first-above written.
RAMTRON INTERNATIONAL CORPORATION
By: /S/ XxXxx X. Xxxxxx
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Name: XxXxx X. Xxxxxx
Title: Chief Financial Officer
HALIFAX FUND, L.P.
By: /S/ Xxxxxxx Xxxxxxx
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Name: Xxxxxxx Xxxxxxx
Title: Counsel
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