BD&G LLP Draft
01/29/97
______________________________
BRUNSWICK TECHNOLOGIES, INC.
AND
XXXXXXXXXX XXXX & XXXX INCORPORATED
_______
REPRESENTATIVE'S
WARRANT AGREEMENT
Dated as of ______, 1997
_____________________________
REPRESENTATIVE'S WARRANT AGREEMENT, dated as of _____, 1997 (this
"Agreement"), between BRUNSWICK TECHNOLOGIES, INC. a Maine corporation (the
"Company"), and XXXXXXXXXX XXXX & XXXX INCORPORATED (the "Representative").
W I T N E S S E T H:
WHEREAS, the Company proposes to issue to the Representative 125,000
warrants ("Warrants") to purchase up to an aggregate of 125,000 shares (the
"Shares") of common stock, $0.0001 par value, of the Company ("Common Stock");
WHEREAS, the Company and the Representative are parties to a Financial
Advisory Agreement, dated as of June 24, 1996, pursuant to which the Company
agreed to issue to the Representative the Warrants in consideration for the
services to be provided by the Representative thereunder; and
WHEREAS, the Representative has agreed pursuant to an Underwriting
Agreement (the "Underwriting Agreement") dated as of February _____, 1997, among
the Representative and Southwest Securities, Inc., individually and as
representatives of the several Underwriters listed on Schedule A thereto (the
"Underwriters"), North Atlantic Venture Fund, L.P. as Selling Stockholder, and
the Company, to underwrite the Company's proposed public offering of up to
2,300,000 shares of Common Stock at a public offering price of $_____ per share
(the "Public Offering").
NOW, THEREFORE, in consideration of the premises, the payment by the
Underwriter to the Company of an aggregate of one hundred dollars ($100.00), the
agreements herein set forth, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:
1. Grant. The Holder (as defined in Section 3.1 below) is hereby
granted an aggregate of 125,000 Warrants giving the Holder the right to
purchase, at any time from February _____, 1998 until 5:30 P.M., New York time,
on ______, 2002 (the "Exercise Period"), up to an aggregate of 125,000 shares of
Common Stock at an initial exercise price (subject to adjustment as provided in
Section 8 hereof) of $____, per share of Common Stock, subject to the terms and
conditions of this Agreement. Each Warrant shall be initially exercisable for
one (1) Share subject to adjustment as provided in Section 8 hereof) at the
exercise price set forth above. Except as set forth herein, the Shares issuable
upon exercise of the Warrants are in all respects identical to the shares of
Common Stock being purchased by the Underwriters for resale to the public
pursuant to the terms and provisions of the Underwriting Agreement.
2. Warrant Certificates. The warrant certificates (the "Warrant
Certificates") delivered and to be delivered pursuant to this Agreement shall be
in the form set forth in
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Exhibit A, attached hereto and made a part hereof, with such appropriate
insertions, omissions, substitutions, and other variations as required or
permitted by this Agreement.
3. Exercise of Warrant.
3.1. Method of Exercise. The Warrants initially are exercisable during
the Exercise Period at an aggregate initial exercise price (subject to
adjustment as provided in Section 8 hereof) per share of Common Stock, set forth
in Section 6 hereof, payable to the Company in cash, by certified check or wire
transfer to an account designated by the Company. Upon surrender during the
Exercise Period of a Warrant Certificate with the annexed Form of Election to
Purchase duly executed, together with payment of the Exercise Price (as
hereinafter defined) for the Shares of Common Stock purchased, at the Company's
principal offices in the United States (presently located at 00 Xxxxxx Xxxxxxx,
Xxxxxxxxx, Xxxxx) the registered holder of a Warrant Certificate ("Holder" or
"Holders") shall be entitled to receive a certificate or certificates for the
Shares of Common Stock so purchased. The purchase rights represented by each
Warrant Certificate are exercisable at the option of the Holder thereof, in
whole or in part (but not as to fractional shares of the Common Stock underlying
the Warrants). In the case of the purchase of less than all the Shares of Common
Stock purchasable under any Warrant Certificate (whether pursuant to this
Section 3.1 or Section 3.2 hereof), the Company shall cancel said Warrant
Certificate upon the surrender thereof and shall execute and deliver a new
Warrant Certificate of like tenor for the balance of the Shares of Common Stock
purchasable thereunder.
3.2. Exercise by Surrender of Warrant. In addition to the method of
payment set forth in Section 3.1 and in lieu of any cash payment required
thereunder, the Holder(s) of the Warrants shall have the right at any time and
from time to time to exercise the Warrants in full or in part by surrendering
the Warrant Certificate in the manner specified in Section 3.1 in exchange for
the number of Shares of Common Stock equal to the product of (x) the number of
Shares of Common Stock as to which the Warrants are being exercised, multiplied
by (y) a fraction, the numerator of which is the aggregate Market Price (as
defined below) of such Common Stock, less the aggregate Exercise Price therefor,
and the denominator of which is such aggregate Market Price. Solely for the
purposes of this paragraph, the Market Price of the Common Stock shall be
calculated as the average of the Market Prices for the Common Stock for each of
the five trading days preceding the date on which the form of election attached
hereto is deemed to have been sent to the Company pursuant to Section 14 hereof.
3.3. Definition of Market Price. As used herein with respect to the
Common Stock, the phrase "Market Price," at any date shall be deemed to be the
last reported sale price of the Common Stock (if such Market Price is being
calculated for the Common Stock), or if no such reported sale takes place on
such day, the average of the last reported sale prices for the last three (3)
trading days, in either case as officially reported by the principal securities
exchange on which the Common Stock are listed or admitted to trading or by
NASDAQ, or if such security is not listed or admitted to trading on any such
securities exchange or quoted by NASDAQ, the average closing bid price as
furnished by the NASD through NASDAQ or similar organization if NASDAQ is no
longer reporting such information, or if the Common Stock are not quoted on
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NASDAQ, then as determined in good faith by resolution of the Board of Directors
of the Company, based on the best information available to it.
4. Issuance of Certificates. Upon the exercise of any Warrants and the
payment of the Exercise Price (as defined below) therefor, the issuance of
certificates for Shares of Common Stock, or other securities, properties, or
rights underlying such Warrants, shall be made forthwith (and in any event
within five (5) business days thereafter) without charge to the Holder thereof,
including without limitation any tax (other than a tax in respect of the income
or gain of the Holder) that may be payable in respect of the issuance thereof,
and such certificates shall (subject to the provisions of Sections 5 and 7
hereof) be issued in the name of, or in such names as may be directed by, such
Holder; provided, however, that the Company shall not be required to pay any tax
that may be payable in respect of any transfer involved in the issuance and
delivery of any such certificates in a name other than that of such Holder and
the Company shall not be required to issue or deliver such certificates unless
or until the person or persons requesting the issuance thereof shall have paid
to the Company the amount of such tax or shall have established to the
satisfaction of the Company that such tax has been paid.
The Warrant Certificates and the certificates representing the Shares
of Common Stock (and/or other securities, property, or rights issuable upon the
exercise of the Warrants) shall be executed on behalf of the Company by the then
President and Treasurer of the Company, under its corporate seal reproduced
thereon, attested to, in the case of the Warrant Certificates, by the signature
of the then Secretary or Clerk of the Company. Warrant Certificates shall be
dated the date of execution by the Company upon initial issuance, division,
exchange, substitution, or transfer.
5. Transfer of Warrants and Restrictions Thereon.
5.1. Split-Up, Combination, Exchange and Transfer of Warrants. Subject
to the provisions of Section 5.2 hereof, any Warrant Certificate issued pursuant
to this Agreement may be split up, combined or exchanged for another Warrant
Certificate or Certificates containing the same terms to purchase a like
aggregate number of Warrant Shares. If any Holder desires to split up, combine
or exchange any Warrant Certificate issued pursuant to this Warrant Agreement,
it shall make such request in writing delivered to the Company and shall
surrender to the Company such Warrant Certificate to be so split-up, combined or
exchanged. Upon any such surrender for a split-up, combination or exchange, the
Company shall execute and deliver to the person or persons entitled thereto a
Warrant Certificate or any Warrant Certificate issued pursuant to this
Agreement, as the case may be, as so requested. The Company may require any
Holder to pay a sum sufficient to cover any tax or governmental charge that may
be imposed in connection with any split-up, combination or exchange of Warrants.
5.2 Restriction On Transfer of Warrants. The Holder of a Warrant
Certificate, by its acceptance thereof, covenants and agrees that the Warrants
are being acquired as an investment and not with a view to the distribution
thereof; that the Warrants may not be sold, transferred, assigned, hypothecated,
or otherwise disposed of, in whole or in part, for a period ending on February
_____, 1998, except to officers or partners of the Representative, provided,
that as a
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condition to any such transfer to an officer or partner of the Representative,
the Representative shall deliver to the Company an opinion of counsel, in form
and substance reasonably satisfactory to the Company, that such transfer may be
made pursuant to an available exemption under the Securities Act of 1933, as
amended (the "Act"), subject in any case to Section 7.1 hereof.
6. Exercise Price.
6.1. Initial and Adjusted Exercise Prices. Except as otherwise provided
in Section 8 hereof, the initial exercise price of each Warrant shall be $______
per Share of Common Stock purchased thereunder. The adjusted exercise price for
the Common Stock shall be the price that shall result from time to time from any
and all adjustments of the initial exercise price therefor in accordance with
the provisions of Section 8 hereof.
6.2. Exercise Price. The term "Exercise Price" herein shall mean the
initial exercise price or the adjusted exercise price, depending upon the
context.
7. Registration Rights.
7.1. Registration Under the Securities Act of 1933. The Warrants have
not been registered under the Act. Upon exercise, in part or in whole, of the
Warrants, certificates representing the Shares of Common Stock underlying the
Warrants and any of the other securities issued or issuable upon exercise of the
Warrants (collectively, the "Warrant Shares") shall be subject to the following
legend:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended ("Act"), and
may not be offered or sold except pursuant to (i) an effective
registration statement under the Act, (ii) to the extent applicable,
Rule 144 under the Act (or any similar rule under such Act relating to
the disposition of securities), or (iii) an opinion of counsel, if such
opinion shall be reasonably satisfactory to counsel to the issuer, that
an exemption from registration under such Act is available."
7.2. Piggyback Registration. Subject to the provisions of Section 7.6
of this Agreement: If, at any time commencing one (1) year after the date hereof
and expiring six (6) years thereafter, the Company proposes to register any
shares of its Common Stock under the Act (other than in connection with a merger
or acquisition registered on Form S-4 (or a similar special-purpose form) or
with an employee benefit plan registered on Form S-8 (or a similar
special-purpose form), and other than any such registration using a form that is
not available for the registration of the Warrant Shares for resale to the
public) it will give written notice by registered mail, at least 20 days prior
to the filing of each such registration statement, to all Holders of Warrants
and/or Warrant Shares of its intention to do so. If any of the Holders of
Warrants and/or Warrant Shares notify the Company within 15 days after receipt
of any such notice of its or their desire to include any such securities in such
proposed registration statement, the Company shall afford each of such Holders
of the Warrants and/or Warrant Shares the
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opportunity to have Warrant Shares registered under such registration statement.
In the event that any registration pursuant to this Section 7.2 shall be, in
whole or in part, an underwritten public offering of Common Stock, the number of
Warrant Shares to be included in such underwriting may be reduced (pro rata
among all requesting Holders pursuant hereto and other holders of rights similar
to those described in this Section 7.2, based upon (a) as to the Holders
requesting hereunder, the number of Warrant Shares owned by such Holders, and
(b) as to any other holders of similar rights, shares of Common Stock owned by,
or issuable to, such holders, as to which such rights are applicable), if and to
the extent that the managing underwriter shall be of the opinion that such
inclusion would adversely affect the marketing of the securities to be sold by
the Company therein. In order to facilitate the allocation of shares as provided
herein, the Company or the underwriter may round the number of shares allocable
to any holder to the nearest 100 shares. The Holders electing to register
Warrant Shares in such an underwritten public offering may be required, as a
condition to such registration, to execute the Underwriting Agreement agreed to
by the Company and the managing underwriter in connection therewith, provided,
that if any Holder disapproves of the terms of any such underwriting, such
Holder may elect to withdraw from such underwriting by written notice to the
Company given at least three days prior to the time anticipated for the
registration statement to be declared effective. The Warrant Shares so withdrawn
from such underwriting shall nevertheless be registered in the registration
statement relating to such underwriting unless the withdrawing Holder thereof
requests otherwise.
Notwithstanding the provisions of this Section 7.2, the Company shall
have the right at any time after it shall have given written notice pursuant to
this Section 7.2 (irrespective of whether a written request for inclusion of any
such securities shall have been made) to elect to postpone or not to file any
such proposed registration statement, or to withdraw the same after the filing
but prior to the effective date thereof, without thereby incurring liability to
the Holders.
7.3. Demand Registration.
(a) Subject to the provisions of Section 7.6 of this
Agreement, at any time during the period commencing one (1) year after
the date hereof and expiring four (4) years thereafter, unless all of
the Warrants issued or issuable have been exercised and the Holders of
the Warrant Shares have received a written opinion of Company counsel,
reasonably satisfactory in form and substance to such Holders, to the
effect that all of the Warrant Shares are freely resalable pursuant to
Rule 144(k) promulgated under the Act, the Holders of the Warrants
and/or Warrant Shares representing a "Majority" (as hereinafter
defined) of such securities shall have the right (which right is in
addition to the registration rights under Section 7.2 hereof), on one
occasion (whether or not all Holders elect to include their Warrant
Shares in the offering), exercisable by written notice to the Company,
to have the Company prepare and file with the Commission, a
registration statement and such other documents, including a
prospectus, as may be
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necessary in the reasonable opinion of both counsel for the Company and
counsel for the Holders, in order to comply with the provisions of the
Act, so as to permit a public offering and sale of their respective
Warrant Shares for nine (9) months by such Holders and any other
Holders of the Warrants and/or Warrant Shares who notify the Company
within ten (10) days after receiving notice from the Company of such
request.
(b) The Company covenants and agrees to give written notice of
any registration request under this Section 7.3 by any Holder or
Holders holding a Majority of the Warrants and Warrant Shares to all
other registered Holders of Warrants and/or Warrant Shares within ten
(10) days from the date of the receipt of any such registration
request.
(c) Notwithstanding anything to the contrary contained herein,
if the Company shall not have filed a registration statement for the
Warrant Shares within the time period specified in Section 7.4(a)
hereof, pursuant to the written notice specified in Section 7.3(a) of a
Majority of the Holders of the Warrants and/or Warrant Shares, the
Company agrees that, upon the written notice of a Majority of the
Holders of the Warrants and/or Warrant Shares of their election to
exercise their rights under this Section 7.3(c), the Company shall have
the option, but not the obligation, to repurchase (i) any and all
Warrant Shares at the higher of the Market Price per share of Common
Stock on (x) the date of the notice sent pursuant to Section 7.3(a) or
(y) the expiration of the period specified in Section 7.4(a) and (ii)
any and all Warrants at the aggregate Market Price (determined as set
forth above in this Section 7.3(c)) of the Common Stock issuable
thereunder less the aggregate Exercise Price of such Warrants. Such
repurchase shall be in immediately available funds and shall close
within two (2) business days after the later of (i) the expiration of
the period specified in Section 7.4(a) or (ii) the delivery of the
written notice of election specified in this Section 7.3(d).
(d) Notwithstanding anything to the contrary contained herein,
no demand may be made pursuant to this Section 7.3 within the period
beginning on the effective date of a registration statement filed by
the Company either: (x) for its own account pursuant to a firm
commitment underwritten public offering, (y) pursuant to a demand under
Section 4(a) of the Registration Rights Agreement, dated as of October
30, 1996, among the Company, Burlington Industries, Inc. and Xxxxx X.
XxXxxx, or (z) pursuant to a demand under Section 4(a) of the Amended
and Restated Registration Rights Agreement, dated as of August 25,
1993, as amended to date, among the Company and certain stockholders of
the Company, and ending on the earlier of the completion of the
distribution pursuant to such registration statement or 120 days after
such effective date.
7.4. Covenants of the Company With Respect to Registration. In
connection with any registration under Section 7.2 or 7.3 hereof, the Company
and the Representative covenant and agree as follows:
(a) In connection with a demand under Section 7.3, the Company
shall use its best efforts to file a registration statement within 45
days of receipt of any demand
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therefor, shall use its best efforts to have any registration
statements declared effective at the earliest possible time, and shall
furnish each Holder desiring to sell Warrant Shares such number of
prospectuses as such holder shall reasonably have requested. If the
Company shall fail to comply with its obligations under this Section
7.4(a), the Company shall, in addition to any other equitable or other
relief available to the Holder(s), extend the Exercise Period by such
number of days as shall equal the delay caused by the Company's
failure.
(b) The Company shall pay all costs (excluding fees and
expenses of Holder(s)' counsel and any underwriting or selling
commissions or other charges of broker-dealers acting on behalf of the
Holders), fees, and expenses incurred by the Company in connection with
all registration statements filed pursuant to Section 7.2 hereof,
including without limitation the Company's legal and accounting fees,
printing expenses, and blue sky fees and expenses.
(c) In the event of the filing of a registration statement
pursuant to a demand made by Holders pursuant to Section 7.3, the
Holders for whom Warrant Shares are pursuant to such demand (including
any Holders whose Warrant Shares are included in such registration
pursuant to Section 7.2), shall pay all costs, fees and expenses
incurred by the Company (including the reasonable and documented fees
and expenses of one counsel for the Company) in connection with all
registration statements filed pursuant to such demand, provided,
however, that (i) in the event that any such registration statement
registers shares for the account of the Company or shareholders other
than any Holders, the Holders shall pay only that portion of the costs,
fees and expenses incurred by the Company in connection with such
registration statement equal to the amount equal to (x) the aggregate
of such costs, fees and expenses incurred by the Company, multiplied by
(y) a fraction, the numerator of which is the number of Warrant Shares
included in such registration statement and the denominator of which is
the total number of shares included in such registration statement; and
(ii) in the event that, at the time the demand is made, the Company is
eligible to use Form S-3 (or any successor form under the Securities
Act) to register the Warrant Shares for resale by the Holders, the
Holders shall not be required to pay fees, costs or expenses of the
Company (including the reasonable and documented fees and expenses of
one counsel for the Company) in connection with any demand made
pursuant to Section 7.3 in the aggregate in excess of $15,000.
(d) The Company shall take all reasonably necessary action
that may be required in qualifying or registering the Warrant Shares
included in a registration statement for offering and sale under the
securities or blue sky laws of such states as reasonably are requested
by the Holder(s), provided that the Company shall not be obligated to
execute or file any general consent to service of process, to qualify
as a foreign corporation to do business under the laws of any such
jurisdiction, or to make any changes in its capital structure or in any
other material aspects of its business or to enter into any material
agreement with any Blue Sky Commissioners, including any agreements to
escrow any shares of its capital stock.
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(e) The Company shall indemnify the Holder(s) of the Warrant
Shares to be sold pursuant to any registration statement and each
person, if any, who controls such Holders within the meaning of Section
15 of the Act or Section 20(a) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), against all loss, claim, damage,
expense or liability (including all expenses reasonably incurred in
investigating, preparing, or defending against any claim whatsoever) to
which any of them may become subject under the Act, the Exchange Act or
otherwise, arising from such registration statement but only to the
same extent and with the same effect as the provisions contained in
Section 9 of the Underwriting Agreement pursuant to which the Company
has agreed to indemnify each of the Underwriters.
(f) The Holder(s) of the Warrant Shares to be sold pursuant to
a registration statement, and their successors and assigns, shall
severally, and not jointly, indemnify the Company and its officers and
directors and each person, if any, who controls the Company within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act,
against all loss, claim, damage, expense, or liability (including all
expenses reasonably incurred in investigating, preparing, or defending
against any claim whatsoever) to which they may become subject under
the Act, the Exchange Act, or otherwise, arising from information
furnished in writing by or on behalf of such Holders, or their
successors or assigns, specifically for inclusion in such registration
statement, to the same extent and with the same effect as the
provisions contained in Section 9 of the Underwriting Agreement
pursuant to which each of the Underwriters has severally agreed to
indemnify the Company.
(g) Nothing contained in this Agreement shall be construed as
requiring the Holder(s) to exercise their Warrants prior to the initial
filing of any registration statement or the effectiveness thereof.
(h) The Company shall not permit the inclusion of any
securities other than the Warrant Shares to be included in any
registration statement filed pursuant to Section 7.3(a) hereof without
the prior written consent of the Holders of the Warrants and the
Warrant Shares representing a Majority of such securities, provided,
however, that any other holders of shares of Common Stock who have the
right, as of the date hereof, to have their shares of Common Stock
included in certain registrations of the Common Stock undertaken by the
Company, shall have the right to have their shares included in such
registration to the extent of such rights. In the event that any
registration undertaken by the Company pursuant to section 7.3(a) shall
be, in whole or in part, an underwritten public offering, (i) as a
condition to permitting the inclusion of any such shares of Common
Stock other than any Warrant Shares in such registration, each holder
thereof must agree to participate in the underwriting arrangements
contemplated in connection with such underwritten public offering, and
(ii) the number of shares to be included in such registration (other
than any Warrant Shares) may be reduced if and to the extent that the
managing underwriter shall be of the opinion that such inclusion would
adversely affect the marketing of the securities to be sold by the
Company therein. In the event of the filing of a registration statement
pursuant to Section 7.3 hereof, the Company shall
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not permit any other registration statement to be or remain effective
during the period commencing on the effective date of the registration
statement filed pursuant to Section 7.3 and ending on the date 120 days
after such effective date, other than with respect to shares issuable
in connection with a merger or acquisition and registered on Form S-4
(or a similar special-purpose form) or with an employee benefit plan
and registered on Form S-8 (or a similar special-purpose form), without
the prior written consent of the Holders of the Warrants and the
Warrant Shares representing a Majority of such securities.
(i) The Company shall cause to be furnished to each Holder
participating in the offering and to each underwriter, if any, a signed
counterpart, addressed to such Holder or underwriter, of (i) an opinion
of counsel to the Company, dated the effective date of such
registration statement (or if such registration includes an
underwritten public offering, an opinion dated the date of the closing
under the underwriting agreement), and (ii) a "cold comfort" letter
dated the effective date of such registration statement (and if such
registration includes an underwritten public offering, a letter dated
the date of the closing under the underwriting agreement) signed by the
independent public accountants who have issued a report on the
Company's financial statements included in such registration statement,
in each case covering substantially the same matters with respect to
such registration statement (and the prospectus included therein) and,
in the case of such accountants' letter, with respect to events
subsequent to the date of such financial statements, as are customarily
covered in opinions of issuer's counsel and in accountants' letters
delivered to underwriters in underwritten public offerings of
securities.
(j) The Company shall as soon as practicable after the
effective date of the registration statement, and in any event within
15 months thereafter, make "generally available to its security
holders" (within the meaning of Rule 158 under the Act) an earnings
statement (which need not be audited) complying with Section 11(a) of
the Act and covering a period of at least 12 consecutive months
beginning after the effective date of the registration statement.
(k) The Company shall deliver promptly to each Holder
participating in the offering requesting the correspondence and
memoranda described below and to the managing underwriters, copies of
all correspondence between the Commission and the Company, its counsel,
or auditors and all memoranda generated or received by the Company and
relating to discussions with the Commission or its staff with respect
to the registration statement and permit each Holder and underwriters
to do such investigation, upon reasonable advance notice, with respect
to information contained in or omitted from the registration statement
as it deems reasonably necessary to comply with applicable securities
laws or rules of the National Association of Securities Dealers, Inc.
("NASD"). Such investigation shall include access to books, records,
and properties and opportunities to discuss the business of the Company
with its officers and independent auditors, all to such reasonable
extent and at such reasonable times and as often as any such Holder or
underwriter shall reasonably request.
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(l) In connection with an underwritten offering pursuant to
Section 7.3, the Company shall enter into an underwriting agreement
with the managing underwriters selected for such underwriting by
Holders holding a Majority of the Warrant Shares requested to be
included in such underwriting, which may be the Representative. If not
the Representative, the selection of such managing underwriter shall be
subject to the approval of the Company, which shall not be unreasonably
withheld or delayed. Such agreement shall be reasonably satisfactory in
form and substance to the Company, each Holder, and such managing
underwriters, and shall contain such representations, warranties, and
covenants by the Company and the participating Holders and such other
terms and conditions as are customarily contained in agreements of that
type used by the managing underwriter. The Holders shall be parties to
any underwriting agreement relating to an underwritten sale of their
Warrant Shares and may, at their option, require that any or all the
representations, warranties, and covenants of the Company to or for the
benefit of such underwriters shall also be made to and for the benefit
of such Holders. Such Holders shall not be required to make any
representations or warranties to or agreements with the Company or the
underwriters except as they may relate to such Holders and their
intended methods of distribution.
(m) For purposes of this Agreement, the term "Majority" in
reference to the Holders of Warrants and/or Warrant Shares, shall mean
in excess of fifty percent (50%) of the then outstanding Warrants
and/or Warrant Shares that (i) are not held by the Company, an
affiliate, officer, creditor, employee, or agent thereof or any of
their respective affiliates, members of their family, persons acting as
nominees or in conjunction therewith and (ii) have not been resold to
the public pursuant to a registration statement filed with the
Commission under the Act.
7.5. Furnishing of Information by Holders in connection with
Registration. In connection with each registration hereunder, the participating
Holders of Warrant Shares will furnish to the Company in writing such
information with respect to themselves and the proposed distribution of Warrant
Shares by them as reasonably shall be necessary in order to assure compliance
with applicable federal and state securities laws.
7.6. No Implied Rights. Notwithstanding any other provision of this
Agreement, nothing in this Agreement shall create any obligation of the Company
to register any securities other than shares of Common Stock that are also
Warrant Shares, except that the Company's registration obligations hereunder
shall also apply to any shares of capital stock or other securities that are
received upon exercise of any Warrant in lieu of shares of Common Stock,
pursuant to Sections 8.5 or 8.6 hereof.
8. Adjustments to Exercise Price and Number of Securities.
8.1. Computation of Adjusted Exercise Price. Except as hereinafter
provided, in case the Company shall at any time after the date hereof issue or
sell any shares of Common Stock, including shares held in the Company's treasury
and shares of Common Stock issued upon the exercise of any options, rights or
warrants to subscribe for shares of Common Stock and shares
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of Common Stock issued upon the direct or indirect conversion or exchange of
securities for shares of Common Stock, for a consideration per share less than
the Exercise Price per share of Common Stock issuable upon exercise of the
Warrants, as in effect immediately prior to the issuance or sale of such shares,
or without consideration, then forthwith upon such issuance or sale, such
Exercise Price shall (until another such issuance or sale) be reduced to the
price (calculated to the nearest full cent) equal to the quotient derived by
dividing (i) an amount equal to the sum of (a) the total number of shares of
Common Stock outstanding immediately prior to the issuance or sale of such
shares, multiplied by the Exercise Price in effect immediately prior to such
issuance or sale, and (b) the aggregate of the amount of all consideration, if
any, received by the Company upon such issuance or sale, by (ii) the total
number of shares of Common Stock outstanding immediately after such issuance or
sale; provided, however, that in no event shall such Exercise Price be adjusted
pursuant to this computation to an amount in excess of the Exercise Price in
effect immediately prior to such computation, except in the case of a
combination of outstanding shares of Common Stock, as provided by Section 8.3
hereof, and provided, further, that in no event shall the Exercise Price be
adjusted pursuant to this Section 8 as a direct consequence of the issuance of
shares of Common Stock upon the exercise of options, warrants or other rights to
cause the Company to issue shares of Common Stock in effect on the date hereof
and described in the Prospectus included in the registration statement filed by
the Company in connection with the Public Offering (the "Prospectus"), including
without limitation shares of Common Stock issuable upon conversion of that
Convertible Promissory Note of the Company, dated as of October 30, 1996, in the
aggregate principal amount of $7,863,000, and the issuance of an aggregate of
2,000 shares to be issued to directors-elect of the Company as described in the
Prospectus, or as a direct consequence of the issuance of options under stock
option or stock incentive plans that have been adopted by the Board of Directors
on or before the date hereof, provided that such options have been granted with
an exercise price no less than the fair market value of the shares of Common
Stock or other securities for which such options may be exercised, on the date
such options are granted.
For the purposes of this Section 8 the term "Exercise Price" shall mean
the Exercise Price per share of Common Stock set forth in Section 6 hereof, as
adjusted from time to time pursuant to the provisions of this Section 8.
For the purposes of any computation to be made in accordance with this
Section 8.1, the following provisions shall be applicable:
(i) In case of the issuance or sale of shares of Common Stock
for a consideration part or all of which shall be cash, the amount of
the cash consideration therefor shall be deemed to be the amount of
cash received by the Company for such shares (or, if shares of Common
Stock are offered by the Company for subscription, the subscription
price, or, if either of such securities shall be sold to underwriters
or dealers for public offering without a subscription offering, the
initial public offering price) before deducting therefrom any
compensation paid or discount allowed in the sale, underwriting or
purchase thereof by underwriters or dealers or others performing
similar services, or any expenses incurred in connection therewith.
-12-
(ii) In case of the issuance or sale (otherwise than as a
dividend or other distribution on any stock of the Company) of shares
of Common Stock for a consideration part or all of which shall be other
than cash, the amount of the consideration therefor other than cash
shall be deemed to be the value of such consideration as determined in
good faith by the Board of Directors of the Company and shall include
any amounts payable to security holders or any affiliates thereof,
including, without limitation, pursuant to any employment agreement,
royalty, consulting agreement, covenant not to compete, earnout or
contingent payment right or similar arrangement, agreement or
understanding, whether oral or written; all such amounts being valued
for the purposes hereof at the aggregate amount payable thereunder,
whether such payments are absolute or contingent, and irrespective of
the period or uncertainty of payment, the rate of interest, if any, or
the contingent nature thereof.
(iii) Shares of Common Stock issuable by way of dividend or
other distribution on any stock of the Company shall be deemed to have
been issued immediately after the opening of business on the day
following the record date for the determination of stockholders
entitled to receive such dividend or other distribution and shall be
deemed to have been issued without consideration.
(iv) The reclassification of securities of the Company other
than shares of Common Stock into securities including shares of Common
Stock shall be deemed to involve the issuance of such shares of Common
Stock for a consideration other than cash immediately prior to the
close of business on the date fixed for the determination of security
holders entitled to receive such shares, and the value of the
consideration allocable to such shares of Common Stock shall be
determined as provided in subsection (ii) of this Section 8.1.
(v) The number of shares of Common Stock at any one time
outstanding shall include the aggregate number of shares issued or
issuable (subject to readjustment upon the actual issuance thereof)
upon the exercise of options, rights, warrants and upon the conversion
or exchange of convertible or exchangeable securities.
(vi) Notwithstanding any other provision of this Section 8,
the Exercise Price of the shares of Common Stock purchasable hereunder
shall not be reduced at any time if the amount of such reduction would
be less than $0.05, but any such amount shall be carried forward and
reduction with respect thereto shall be made at the time of any
subsequent reduction that, together with any previously carried forward
reductions, aggregates $0.05 or more.
8.2. Options, Rights, Warrants and Convertible and Exchangeable
Securities. In case the Company shall at any time after the date hereof issue
options, rights or warrants to subscribe for shares of Common Stock, or issue
any securities convertible into or exchangeable for shares of Common Stock, for
a consideration per share less than the Exercise Price in effect immediately
prior to the issuance of such options, rights or warrants, or such convertible
or exchangeable securities, or without consideration, the Exercise Price in
effect immediately prior
-13-
to the issuance of such options, rights or warrants, or such convertible or
exchangeable securities, as the case may be, shall be reduced to a price
determined by making a computation in accordance with the provisions of Section
8.1 hereof, provided that:
(a) The aggregate maximum number of shares of Common Stock, as
the case may be, issuable under such options, rights or warrants shall
be deemed to be issued and outstanding at the time such options, rights
or warrants were issued, and for a consideration equal to the minimum
purchase price per share provided for in such options, rights or
warrants at the time of issuance, plus the consideration (determined in
the same manner as consideration received on the issue or sale of
shares in accordance with the terms hereof), if any, received by the
Company for such options, right or warrants.
(b) The aggregate maximum number of shares of Common Stock
issuable upon conversion or exchange of any convertible or exchangeable
securities shall be deemed to be issued and outstanding at the time of
issuance of such securities, and for a consideration equal to the
consideration (determined in the same manner as consideration received
on the issue or sale of shares of Common Stock in accordance with the
terms hereof) received by the Company for such securities, plus the
minimum consideration, if any, receivable by the Company upon the
conversion or exchange thereof.
(c) If any change shall occur in the price per share provided
for in any of the options, rights or warrants referred to in subsection
(a) of this Section 8.2, or in the price per share at which the
securities referred to in subsection (b) of this Section 8.2 are
convertible or exchangeable, such options, rights or warrants or
conversion or exchange rights, as the case may be, shall be deemed to
have expired or terminated on the date when such price change became
effective in respect of shares not theretofore issued pursuant to the
exercise or conversion or exchange thereof, and the Company shall be
deemed to have issued upon such date new options, rights or warrants or
convertible or exchangeable securities at the new price in respect of
the number of shares issuable upon the exercise of such options, rights
or warrants or the conversion or exchange of such convertible or
exchangeable securities.
8.3. Subdivision and Combination; Stock Dividends and Distributions. In
case the Company shall at any time subdivide or combine the outstanding shares
of Common Stock, or issue shares of Common Stock as a dividend or other
distribution in respect of shares of Common Stock, the Exercise Price per share
of Common Stock purchasable hereunder shall forthwith be proportionately
decreased in the case of a subdivision or stock dividend or distribution or
increased in the case of a combination. Notwithstanding the foregoing, in no
event shall any adjustment in the Exercise Price be made pursuant to this
Section 8.3 upon the issuance of up to ______ shares of Common Stock to the
holders of the Company's outstanding Preferred Stock, no par value, in payment
of cash dividends on such Preferred Stock accrued prior to the date hereof and
described in the Prospectus.
-14-
8.4. Adjustment in Number of Securities. Upon each adjustment of the
Exercise Price per share of Common Stock purchasable hereunder pursuant to the
provisions of this Section 8, the respective numbers of shares of Common Stock
issuable upon the exercise of each Warrant shall be adjusted to the nearest full
amount by multiplying a number equal to the Exercise Price per share of Common
Stock purchasable hereunder in effect immediately prior to such adjustment by
the number of shares of Common Stock issuable upon exercise of the Warrants
immediately prior to such adjustment and dividing the product so obtained by the
adjusted Exercise Price per share of Common Stock purchasable hereunder.
8.5. Definition of Common Stock. For the purpose of this Agreement, the
term "Common Stock" shall mean (i) the class of stock designated as Common Stock
in the Restated Articles of Incorporation of the Company as amended through the
date hereof, or (ii) any other class of stock resulting from successive changes
or reclassifications of such Common Stock consisting solely of changes in par
value, or from par value to no par value, or from no par value to par value.
8.6. Merger or Consolidation. In case of any consolidation of the
Company with, or merger of the Company with, or merger of the Company into,
another corporation (other than a consolidation or merger that does not result
in any reclassification or change of the outstanding Common Stock), the
corporation formed by such consolidation or surviving such merger shall execute
and deliver to the Holder a supplemental warrant agreement providing that the
holder of each Warrant outstanding immediately prior to the effective time of
such consolidation or merger shall have the right thereafter (until the
expiration of such Warrant) to receive, upon exercise of such Warrant, the kind
and amount of shares of stock and other securities and property receivable upon
such consolidation or merger, by a holder of the number of shares of Common
Stock of the Company for which such Warrant might have been exercised
immediately prior to such consolidation or merger. Such supplemental warrant
agreement shall provide for adjustments that shall be identical to the
adjustments provided in Section 8. The above provision of this subsection shall
similarly apply to successive consolidations or mergers.
8.7. Dividends and Other Distributions. In the event that the Company
shall at any time prior to the exercise of all Warrants declare a dividend
(other than a dividend consisting solely of cash or shares of Common Stock) or
otherwise distribute to the holders of Common Stock any assets, property,
rights, evidences of indebtedness, securities, whether issued by the Company or
by another, or any other thing of value (other than cash or shares of Common
Stock), the Holders of the unexercised Warrants shall thereafter be entitled, in
addition to the shares of Common Stock or other securities and property
receivable upon the exercise thereof, to receive, upon the exercise of such
Warrants for shares of Common Stock, the same property, assets, rights,
evidences of indebtedness, securities or any other thing of value that they
would have been entitled to receive at the time of such dividend or distribution
as if such Warrants had been exercised, immediately prior to the record date for
determining the stockholders entitled to receive such dividend or distribution,
for the shares of Common Stock for which such Warrants are then being exercised.
At the time of any such dividend or distribution, the Company shall make
appropriate reserves to ensure the timely performance of the provisions of this
subsection.
-15-
8.8. Preservation of Purchase Rights in Certain Transactions. In case
of any reclassification, capital reorganization or other change of outstanding
shares of Common Stock (other than a subdivision or combination of the
outstanding Common Stock and other than a change in the par value of the Common
Stock) or in case of any consolidation or merger of the Company with or into
another corporation (other than a merger with a subsidiary in which the Company
is the continuing corporation and that does not result in any reclassification,
capital reorganization or other change of outstanding shares of Common Stock of
the class issuable upon exercise of the Warrants) or in case of any sale, lease,
transfer or conveyance to another corporation of the property and assets of the
Company as an entirety or substantially as an entirety, the Company shall use
its best efforts to cause such successor or purchasing corporation, as the case
may be, to execute with the Holders an agreement granting the Holders the right
thereafter, upon payment of the Exercise Price in effect immediately prior to
such action, to receive upon exercise of the Warrants the kind and amount of
shares and other securities and property which he would have owned or have been
entitled to receive after the happening of such reclassification, change,
consolidation, merger, sale or conveyance had the Warrants been exercised
immediately prior to such action. Such agreement shall provide for adjustments
in respect of such shares of stock and other securities and property, which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Section 8. In the event that in connection with any such
reclassification, capital reorganization, change, consolidation, merger, sale or
conveyance, additional shares of Common Stock shall be issued in exchange,
conversion, substitution or payment, in whole or in part, for, or of, a security
of the Company other than Common Stock, any such issue shall be treated as an
issue of Common Stock covered by the provisions of Section 8. The provisions of
this Section 8.8 shall similarly apply to successive reclassification, capital
reorganizations, consolidations, mergers, sales or conveyances.
9. Exchange and Replacement of Warrant Certificates. Each Warrant
Certificate is exchangeable without expense, upon the surrender thereof by the
registered Holder at the principal executive office of the Company, for a new
Warrant Certificate of like tenor and date representing in the aggregate the
right to purchase the same number of shares of Common Stock in such
denominations as shall be designated by the Holder thereof at the time of such
surrender.
Upon receipt by the Company of evidence reasonably satisfactory to it
of the loss, theft, destruction, or mutilation of any Warrant Certificate, and
in case of loss, theft, or destruction, of indemnity or security reasonably
satisfactory to it, and reimbursement to the Company of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Warrants, if
mutilated, the Company shall execute and deliver a new Warrant Certificate of
like tenor, in lieu thereof.
10. Elimination of Fractional Interests. The Company shall not be
required to issue certificates representing fractions of shares of Common Stock
upon the exercise of the Warrants, but instead shall pay cash in lieu of
fractional interests, based on the market value of a share of Common Stock.
-16-
11. Reservation and Listing of Securities. The Company shall at all
times reserve and keep available out of its authorized shares of Common Stock,
solely for the purpose of issuance upon the exercise of the Warrants, such
number of shares of Common Stock or other securities, properties or rights as
shall be issuable upon such exercise. The Company covenants and agrees that,
upon exercise of the Warrants in the manner provided herein and therein and
payment of the Exercise Price herein, all shares of Common Stock and other
securities issued upon the exercise of the Warrants shall be duly and validly
issued, fully paid, non-assessable, and not subject to the preemptive rights of
any stockholder or other person or entity. As long as the Warrants shall be
outstanding, the Company shall use its best efforts to cause all shares of
Common Stock issuable upon the exercise of the Warrants to be listed (subject to
official notice of issuance) on all securities exchanges on which the Common
Stock issued to the public in connection herewith may then be listed and/or
quoted on NASDAQ.
12. Notices to Warrant Holders. Nothing contained in this Agreement
shall be construed as conferring upon the Holders the right to vote or to
consent or to receive notice as a stockholder in respect of any meetings of
stockholders for the election of directors or any other matter, or as having any
rights whatsoever as a stockholder of the Company. If, however, at any time
prior to the expiration of the Warrants and their exercise, any of the following
events shall occur:
(a) the Company shall take a record of the holders of its
shares of Common Stock for the purpose of entitling them to receive a
dividend or distribution payable otherwise than in cash, or a cash
dividend or distribution payable otherwise than out of current or
retained earnings, as indicated by the accounting treatment of such
dividend or distribution on the books of the Company; or
(b) the Company shall offer to all the holders of its Common
Stock any additional shares of capital stock of the Company or
securities convertible into or exchangeable for shares of capital stock
of the Company, or any option, right, or warrant to subscribe therefor;
or
(c) a dissolution, liquidation, or winding-up of the Company
(other than in connection with a consolidation or merger) or a sale of
all or substantially all of its property, assets, and business as an
entirety shall be proposed;
then, in any one or more of said events, the Company shall give written notice
of such event at least fifteen (15) days prior to the date fixed as a record
date or the date of closing the transfer books for the determination of the
stockholders entitled to such dividend, distribution, convertible or
exchangeable securities, or subscription rights, or entitled to vote on such
proposed dissolution, liquidation, winding-up, or sale. Such notice shall
specify such record date or the date of closing the transfer books, as the case
may be. Failure to give such notice or any defect therein shall not affect the
validity of any action taken in connection with the declaration or payment of
any such dividend, or the issuance of any convertible or exchangeable
securities, or subscription rights, options, or warrants, or any proposed
dissolution, liquidation, winding-up, or sale.
13. Notices.
All notices, requests, consents and other communications hereunder
shall be in writing and shall be deemed to have been duly made and sent when
delivered, or mailed by registered or certified mail, return receipt requested:
(a) If to the registered Holder of the Warrants, to the
address of such Holder as shown on the books of the Company; or
(b) If to the Company, to the address set forth in Section 3
hereof or to such other address as the Company may designate by notice
to the Holders.
14. Supplements and Amendments. The Company and the Representative may
from time to time supplement or amend this Agreement without the approval of any
holders of Warrant Certificates (other than the Representative) in order to cure
any ambiguity, to correct or supplement any provision contained herein that may
be defective or inconsistent with any provisions herein, or to make any other
provisions in regard to matters or questions arising hereunder which the Company
and the Representative may deem necessary or desirable and that the Company and
the Representative deem shall not adversely affect the interests of the Holders
of Warrant Certificates. Any other amendment or modification of this Agreement
may be made only by written agreement of the Company and the Holders of the
Warrants and the Warrant Shares representing a Majority of such securities.
15. Company Representation. The Company hereby represents and warrants
that (i) all necessary corporate action has been duly and validly taken by the
Company to authorize the execution, deliver and performance of this Agreement
and any Warrant Certificates issued in connection herewith and, upon exercise of
the Warrants or any successor warrants, the issuance of the Warrant Shares, and
(ii) this Agreement and the initial Warrant Certificate representing the
Warrants issued to the Representatives have been duly and validly executed and
delivered by the Company and constitute the legal, valid and binding obligations
of the Company, enforceable against the Company in accordance with their
respective terms, except as the enforceability hereof or thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles.
16. No Inconsistent Agreements. The Company will not on or after the
date of this Agreement enter into any agreement with respect to its securities
which is inconsistent with the rights granted to the Holders or otherwise
conflicts with the provisions hereof. The rights granted to the Holders
hereunder do not in any way conflict with and are not inconsistent with the
rights granted to holders of the Company's securities under any other
agreements.
17. Successors. All the covenants and provisions of this Agreement
shall be binding upon and inure to the benefit of the Company and the Holders,
and their respective successors and assigns hereunder. Each Holder agrees that
it will provide notice to the Company of any
-18-
transfer or assignment of its rights or interests hereunder. Any failure by the
Company to fulfill a covenant or obligation will not be deemed a breach of such
covenant or obligation to the extent that it is the result of the failure of the
Holder to give such notice.
18. Termination. This Agreement shall terminate at the close of
business on ________, 2003. Notwithstanding the foregoing, the provisions of
Sections 7 and 13 through 24 shall survive such termination.
19. Governing Law; Submission to Jurisdiction. This Agreement and each
Warrant Certificate issued hereunder shall be deemed to be a contract made under
the laws of the State of New York and for all purposes shall be construed in
accordance with the laws of said State without giving effect to the rules of
said State governing the conflicts of laws.
Each of the Company, the Representative, and the Holders hereby agrees
that any action, proceeding, or claim arising out of, or relating in any way to,
this Agreement shall be brought and enforced in the courts of the State of New
York or of the United States of America for the Southern District of New York,
and irrevocably submits to such jurisdiction, which jurisdiction shall be
exclusive. Each of the Company, the Representative, and the Holders hereby
irrevocably waive any objection to such exclusive jurisdiction or inconvenient
forum.
Any such process or summons to be served upon any of the Company, the
Representative, and/or the Holders (at the option of the party bringing such
action, proceeding or claim) may be served by transmitting a copy thereof, by
registered or certified mail, return receipt requested, postage prepaid,
addressed to it at the address set forth in Section 13 hereof. Such mailing
shall be deemed personal service and shall be legal and binding upon the party
so served in any action, proceeding, or claim. The Company, the Representative,
and the Holders agree that the prevailing party(ies) in any such action or
proceeding shall be entitled to recover from the other party(ies) all of
its/their reasonable legal costs and expenses relating to such action or
proceeding and/or incurred in connection with the preparation therefor.
20. Entire Agreement; Modification. This Agreement (including the
Underwriting Agreement to the extent portions thereof are referred to herein)
contains the entire understanding between the parties hereto with respect to the
subject matter hereof and may not be modified or amended except pursuant to
Section 14 hereof.
21. Severability. If any provision of this Agreement shall be held to
be invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of this Agreement.
22. Captions. The caption headings of the Sections of this Agreement
are for convenience of reference only and are not intended, nor should they be
construed as, a part of this Agreement and shall be given no substantive effect.
23. Benefits of this Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company and the
Representative and any other
-19-
registered Holder(s) of the Warrant Certificates or Warrant Shares any legal or
equitable right, remedy or claim under this Agreement.
24. 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 such counterparts shall together constitute but one and the
same agreement.
[Remainder of Page Left Blank Intentionally]
-20-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
BRUNSWICK TECHNOLOGIES, INC.
[SEAL] By
--------------------------------
Attest:
------------------------
Secretary
XXXXXXXXXX XXXX & XXXX
INCORPORATED
By
--------------------------------
Name:
Title:
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE OTHER SECURITIES ISSUABLE
UPON EXERCISE THEREOF MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933, (ii) TO THE
EXTENT APPLICABLE, RULE 144 UNDER SUCH ACT (OR ANY SIMILAR RULE UNDER SUCH ACT
RELATING TO THE DISPOSITION OF SECURITIES), OR (iii) AN OPINION OF COUNSEL, IF
SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL FOR THE ISSUER, THAT AN
EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
THE TRANSFER OR EXCHANGE OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE TO
OTHER THAN THE OFFICERS AND PARTNERS OF XXXXXXXXXX XXXX & XXXX INCORPORATED
PRIOR TO ____________, 1998 IS RESTRICTED IN ACCORDANCE WITH THE WARRANT
AGREEMENT REFERRED TO HEREIN.
EXERCISABLE ON OR BEFORE
5:30 P.M., NEW YORK TIME, ________, 2002
(SUBJECT TO EXTENSION AS DESCRIBED HEREIN)
No. W- __Warrants
WARRANT CERTIFICATE
This Warrant Certificate certifies that XXXXXXXXXX XXXX & XXXX
INCORPORATED, or registered assigns, is the registered holder of 125,000
warrants (collectively, the "Warrants") to purchase initially, at any time from
______, 1997 until 5:30 p.m. New York time on ______, 2002 (subject to extension
as described in Section 7.4(b) of the Warrant Agreement referred to below) (the
"Expiration Date"), up to 125,000 fully-paid and non-assessable shares of common
stock, $0.0001 par value ("Common Stock") of BRUNSWICK TECHNOLOGY, INC., a Maine
corporation (the "Company"). The initial exercise price payable hereunder upon
exercise of the Warrants represented hereby for the shares of Common Stock
purchasable hereunder, subject to adjustment as set forth herein (the "Exercise
Price"), is $_____ per share of Common Stock, upon surrender of this Warrant
Certificate and payment of the Exercise Price at an office or agency of the
Company, but subject to the conditions set forth herein and in the
Representative's Warrant Agreement dated as of ______, 1997, between the Company
and XXXXXXXXXX XXXX & XXXX INCORPORATED (the "Warrant Agreement").
-2-
Payment of the Exercise Price shall be made by check payable to the order of the
Company or wire transfer to an account designated by the Company or by surrender
of this Warrant Certificate in the manner provided in the Warrant Agreement.
No Warrant may be exercised after 5:30 p.m., New York time, on the
Expiration Date, at which time all Warrants evidenced hereby, unless exercised
prior thereto, hereby shall thereafter be void.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants issued pursuant to the Warrant Agreement, 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.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price and the type and/or number of the Company's securities
issuable thereupon may, subject to certain conditions, be adjusted. In such
event, the Company will, at the request of the holder, issue a new Warrant
Certificate evidencing the adjustment in the Exercise Price and the number
and/or type of securities issuable upon the exercise of the Warrants; provided,
however, that the failure of the Company to issue such new Warrant Certificates
shall not in any way change, alter, or otherwise impair, the rights of the
holder as set forth in the Warrant Agreement.
Upon due presentment for registration of transfer of this Warrant
Certificate at an office or agency 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 herein and in the Warrant
Agreement, without any charge except for any tax or other governmental charge
imposed in connection with such transfer.
Upon the exercise of less than all of the Warrants evidenced by this
Certificate, the Company shall forthwith issue to the holder hereof a new
Warrant Certificate representing such number of unexercised Warrants.
The Company may deem and treat the registered holder(s) hereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, and of any distribution to the holder(s) hereof, and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
All terms used in this Warrant Certificate which are defined in the
Warrant Agreement shall have the meanings assigned to them in the Warrant
Agreement.
-3-
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to
be duly executed under its corporate seal.
Dated as of _________, 1997.
BRUNSWICK TECHNOLOGIES, INC.
[SEAL] By:
-------------------------------
Name:
Title:
Attest:
------------------------------
Secretary
[FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 3.1]
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase shares of Common Stock and
herewith tenders in payment for such securities a check payable to the order of
BRUNSWICK TECHNOLOGIES, INC. (the "Company") in the amount of $ , all in
accordance with the terms of Section 3.1 of the Representative's Warrant
Agreement dated as of ________, 1997 between the Company and XXXXXXXXXX XXXX &
XXXX INCORPORATED. The undersigned requests that a certificate for such
securities be registered in the name of_________________, whose address
is_____________ and that such Certificate be delivered to________________, whose
address is_________________.
Dated:
Signature
---------------------------
(Signature must conform in all
respects to name of holder as
specified on the face of the Warrant
Certificate.)
(Insert Taxpayer Identification, Social
Security or Other Identifying Number of Holder)
[FORM OF ELECTION TO PURCHASE PURSUANT TO SECTION 3.2]
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to purchase shares of Common Stock in
accordance with the terms of Section 3.2 of the Representative's Warrant
Agreement dated as of _______, 1997 between BRUNSWICK TECHNOLOGIES, INC. and
XXXXXXXXXX XXXX & XXXX INCORPORATED. The undersigned requests that a certificate
for such securities be registered in the name of_________________, whose address
is_____________________________ and that such Certificate be delivered
to_________________, whose address is____________________________ .
Dated:
Signature
--------------------------
(Signature must conform in all
respects to name of holder as
specified on the face of the Warrant
Certificate.)
------------------------------------
(Insert Taxpayer Identification, Social
Security or Other Identifying Number of Holder)
[FORM OF ASSIGNMENT]
(To be executed by the registered holder if such holder
desires to transfer the Warrant Certificate.)
FOR VALUE RECEIVED__________________ hereby sells, assigns and
transfers unto________________________ .
(Please print name and address of transferee)
this Warrant Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint Attorney, to transfer the
within Warrant Certificate on the books of the within-named Company, with full
power of substitution.
Dated:
Signature
--------------------------
(Signature must conform in all
respects to name of holder as
specified on the face of the Warrant
Certificate.)
------------------------------------
(Insert Taxpayer Identification, Social
Security or Other Identifying Number of Holder)
