EXHIBIT NO. 10.1
SECOND AGREEMENT FOR PAYMENT
OF INTEREST WITH STOCK
THIS AGREEMENT is made and entered
into as of January 31, 2005, by and between Micro Component
Technology, Inc., a Minnesota corporation (the
“Company”), and the undersigned holders of the
Company’s 10% Senior Subordinated Convertible Notes, due
December 24, 2006 (the “Notes”).
Recitals
The Company issued the Notes on
December 24, 2001 to a group of purchasers (the
“Noteholders”), pursuant to a Note Purchase Agreement
(the “Note Purchase Agreement”), and a Registration
Rights Agreement (the “Registration Rights Agreement”),
both dated December 24, 2001.
The Notes provide for semi-annual
payments of accrued interest, in cash, on June 30 and
December 31 of each year until maturity on December 24,
2006. Pursuant to the prior Agreement for Payment of Interest
with Stock, effective June 30, 2003 (the “Prior
Agreement’), holders of substantially all of the Notes agreed
to accept shares of the Company’s common stock, par value
$.01 per share (“Shares”) in full payment of accrued
interest in 2003 and 2004, and the conversion price for the Notes
was reduced from $2.60 to $1.00 per share.
The Company has now requested the
undersigned Noteholders to accept Shares in full payment of accrued
interest in 2005 and 2006, and the Company and the undersigned
Noteholders wish to enter into an agreement specifying the terms
and conditions for such payment, and a further reduction in the
conversion price for the Notes.
A total of $3,629,919 principal
amount of the Notes remains outstanding.
Agreement
1.
Payment in
Shares . Interest due and payable on the Notes on
each of the June 30, 2005, December 31, 2005,
June 30, 2006, and December 24, 2006 interest payment
dates (the “Interest Payment Dates”) shall be paid in
Shares to each of the undersigned Noteholders. The number of
Shares payable to each of the undersigned Noteholders on each
Interest Payment Date shall be equal to the amount of interest
payable to the undersigned Noteholder on such date, divided by the
average closing sale price of the Shares on the OTC Bulletin Board
(or successor market) for the ten consecutive trading days ending
immediately prior to the Interest Payment Date. Certificates
for the Shares shall be issued and delivered to the undersigned
Noteholders as soon as practicable following the applicable
Interest Payment Date. Delivery of the Shares to the
undersigned Noteholders in this manner shall constitute payment in
full of all accrued interest due on the applicable Interest Payment
Date. Upon issuance, the Shares shall constitute validly
issued, fully-paid and nonassessable shares of the Company’s
common stock.
2.
Reduction in Conversion
Price .
Effective as to the
undersigned Noteholders, the definition of “Conversion
Price”, contained in Section 1 of the Notes, shall be
revised to state as follows:
“ Conversion Price
” means $2.60 through and including June 30, 2003; $1.00
from July 1, 2003 through and including January 31, 2005
(except for those Noteholders who did not execute the Prior
Agreement and for whom conversion price remained $2.60 through
January 31, 2005); and $0.85 from February 1, 2005
through and including December 24, 2006. The reduction
in the Conversion Price hereby to $0.85 fully satisfies the
Company’s obligation to adjust the Conversion Price pursuant
to Section 8(c), as amended, through January 31,
2005.
3.
Adjustments to Conversion
Price for Noteholders . For the undersigned Noteholders who did not
execute the Prior Agreement, Sections 8(c), 8(d), and 8(h) of the
Notes, governing adjustments in the Conversion Price, are deleted,
and replaced by the following new Section 8(c). For the
undersigned Noteholders who executed the Prior Agreement, and for
whom the following Section 8(c) was added by the Prior
Agreement, paragraph (xiii) of Section 8(c) is replaced by new
paragraph (xiii) as set forth below.
8(c) Adjustments to Conversion
Price .
The Conversion Price and the number
of Common Shares shall be subject to adjustment from time to time
upon the happening of certain events as provided in this
Section 8(c):
(i)
(A) If the Company at any
time hereafter issues, grants or sells any shares of Common Stock,
or options, warrants or other rights to acquire shares of Common
Stock, or securities convertible or exchangeable, directly or
indirectly, into shares of Common Stock, for a consideration,
exercise or conversion price per share less than the Conversion
Price in effect immediately prior to the issuance, grant or sale of
such shares, options, warrants or other rights, or other securities
convertible or exchangeable, directly or indirectly, into shares of
Common Stock, or without consideration, then forthwith upon such
issuance, grant or sale, the Conversion Price shall be adjusted so
that the Conversion Price shall equal the Conversion Price
immediately prior to the date of such issuance, grant or sale
multiplied by a fraction, the numerator of which shall be (aa) the
number of shares of Common Stock outstanding on the date of such
issuance, grant or sale, plus (bb) the number of additional shares
of Common Stock which the aggregate consideration received by the
Company upon such issuance, grant or sale (plus the aggregate of
any additional amount to be received by the Company upon the
exercise of such options, warrants, rights or securities) would
purchase at such Conversion Price, and the denominator of which
shall be (aa) the number of shares of Common Stock outstanding on
the date of such issuance, grant or sale, plus (bb) the number of
additional shares of Common Stock issued, granted or sold (or into
which the options, warrants, rights or securities so issued,
granted or sold are exercisable, convertible or
exchangeable).
(B) For the purpose of
any computation to be made in accordance with this paragraph (i),
the following provisions shall be applicable:
(aa)
In the case of the issuance or sale
of shares of Common Stock or such options, warrants, rights or
other securities for a consideration part or all of which shall be
cash, the amount of the cash consideration therefore shall be
deemed to be the amount of cash received by the Company for such
shares, options, warrants, rights or other securities (or, if
shares of Common Stock or such options, warrants, rights or other
securities are offered by the Company for subscription, the
subscription price, or, if shares of Common Stock or such options,
warrants, rights or other securities shall be sold to underwriters
or dealers for public offering without a subscription offering, the
initial public offering price) before deducting there from 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.
(bb)
In the 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 or such options, warrants,
rights or other securities for a consideration part or all of which
shall be other than cash, the amount of the consideration therefore
other than cash shall be deemed to be the fair market value of such
consideration as determined in good faith by the Board of
Directors.
(cc)
This paragraph (i) shall not apply
with respect to a stock dividend or distribution payable in shares
of capital stock of the Company, but paragraph (vi) hereof shall
apply with respect to such transaction or issuance.
(dd)
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 or such options, warrants,
rights or other securities 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 or such options, warrants, rights or other securities, and
the value of the consideration allocable to such shares of Common
Stock or such options, warrants, rights or other securities shall
be determined as provided in paragraph (i)(B)(bb)
hereof.
(ee)
The number of shares of Common Stock
at any one time outstanding shall include the aggregate number of
shares issued or issuable upon the exercise in full of all options,
rights and warrants and upon the conversion or exchange in full of
convertible or exchangeable securities.
(C) Subject to paragraph
(ii) hereof, with respect to any issuance, grant or sale of
options, warrants or other rights to acquire shares of Common Stock
or securities convertible or exchangeable, directly or indirectly,
into shares of Common Stock, the adjustment, if any, provided for
pursuant to this paragraph (i) shall be made upon the issuance,
grant or sale of such option, warrant, right or security (and no
additional adjustment shall be made upon the exercise, conversion
or exchange thereof to the extent such additional adjustment would
be duplicative of a prior adjustment).
(ii)
If the purchase price provided for
in any options, rights or warrants, the additional consideration,
if any, payable upon the conversion or exchange of any convertible
or exchangeable securities, or the rate at which any
convertible
or exchangeable securities are convertible into
or exchangeable for Common Stock, shall change at any time (other
than under or by reason of provisions designed to protect against
dilution), the Conversion Price adjusted pursuant to paragraph (i)
hereof in effect at the time of such event shall forthwith be
readjusted to the Conversion Price which would have been in effect
at such time had such options, rights, warrants and convertible and
exchangeable securities still outstanding provided for such changed
purchase price, additional consideration or conversion rate, as the
case may be, at the time initially granted, issued or sold; and on
the expiration of any such options, warrants or rights or the
termination of any such right to convert or exchange such
convertible securities or exchangeable securities, the Conversion
Price then in effect hereunder shall forthwith be increased to the
Conversion Price which would have been in effect at the time of
such expiration or termination had such options, rights, warrants
or convertible or exchangeable securities, to the extent
outstanding immediately prior to such expiration or termination,
never been issued.
(iii)
Upon each adjustment of the
Conversion Price pursuant to paragraph (i), the number of Common
Shares issuable upon conversion of the Notes shall be adjusted so
that such number shall equal the number of Common Shares issuable
immediately prior to such adjustment of the Conversion Price
multiplied by a fraction, the numerator of which shall be the
Conversion Price immediately prior to such adjustment in the
Conversion Price and the denominator of which shall be the
Conversion Price immediately following such adjustment in the
Conversion Price. This paragraph (iii) is not intended to
increase the number of shares of Common Stock issuable upon
conversion of the Notes over the number determined by dividing the
dollar amount being converted by the Conversion Price then in
effect.
(iv)
If the Company shall at any time
after the Issue Date issue, grant or sell securities with greater
or superior voting rights than the shares of Common Stock
outstanding as of the Issue Date, Holders, at their option, may
receive upon conversion either the Common Shares or a like number
of such securities with greater or superior voting rights, in
addition to all other securities and property otherwise issuable
upon such conversion.
(v)
In the case of any consolidation of
the Company with, or merger of the Company with, or merger of the
Company into, or sale or transfer by the Company of all or
substa
