Exhibit 4.2
FORM OF WARRANT CERTIFICATE
THE
SECURITIES REPRESENTED HEREBY MAY NOT BE TRANSFERRED UNLESS (I)
SUCH SECURITIES HAVE BEEN REGISTERED FOR SALE PURSUANT TO THE
SECURITIES ACT OF 1933, AS AMENDED, (II) SUCH SECURITIES MAY BE
SOLD PURSUANT TO RULE 144(K), OR (III) THE COMPANY HAS RECEIVED AN
OPINION OF COUNSEL REASONABLY SATISFACTORY TO IT THAT SUCH TRANSFER
MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT
OF 1933 OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES
LAWS.
SUBJECT
TO THE PROVISIONS OF SECTION 10 HEREOF, THIS WARRANT SHALL BE VOID
AFTER 5:00 P.M. EASTERN TIME ON [FIFTH ANNIVERSARY OF THE CLOSING
DATE] (THE “EXPIRATION DATE”).
No. _______
TEGAL CORPORATION
WARRANT TO PURCHASE _________ SHARES
OFCOMMON
STOCK, PAR VALUE $0.01 PER SHARE
For
VALUE RECEIVED, _____________ (“Warrantholder”), is
entitled to purchase, subject to the provisions of this Warrant,
from Tegal Corporation, a Delaware corporation
(“Company”), at any time not later than 5:00 P.M.,
Eastern time, on the Expiration Date (as defined above), at an
exercise price per share equal to $1.00 (the exercise price in
effect being herein called the “Warrant Price”),
__________ shares (“Warrant Shares”) of the
Company’s Common Stock, par value $0.01 per share
(“Common Stock”). The number of Warrant Shares
purchasable upon exercise of this Warrant and the Warrant Price
shall be subject to adjustment from time to time as described
herein.
Section
1. Registration . The Company shall maintain books for the
transfer and registration of the Warrant. Upon the initial issuance
of this Warrant, the Company shall issue and register the Warrant
in the name of the Warrantholder.
Section
2. Transfers . As provided herein, this Warrant and the
Warrant Shares may be transferred only pursuant to a registration
statement filed under the Securities Act of 1933, as amended (the
“Securities Act”), or an exemption from such
registration. Subject to such restrictions, the Company shall
transfer this Warrant from time to time upon the books to be
maintained by the Company for that purpose, upon surrender thereof
for transfer properly endorsed or accompanied by appropriate
instructions for transfer and such other documents as may be
reasonably required by the Company, including, if required by the
Company, an opinion of counsel to the effect that such transfer is
exempt from the registration requirements of the Securities Act, to
establish that such transfer is being made in accordance with the
terms hereof, and a new Warrant shall be issued to the transferee
and the surrendered Warrant shall be canceled by the
Company.
Section
3. Exercise of Warrant . Subject to the provisions hereof,
the Warrantholder may exercise this Warrant in whole or in part at
any time prior to its expiration upon surrender of the Warrant,
together with delivery of the duly executed Warrant exercise form
attached hereto as Appendix A (the “Exercise
Agreement”) and payment by cash, certified check or wire
transfer of funds (or, in certain circumstances, by cash-less
exercise as provided below) for the aggregate Warrant Price for
that number of Warrant Shares then being purchased, to the Company
during normal business hours on any business day at the
Company’s principal executive offices (or such other office
or agency of the Company as it may designate by notice to the
Warrantholder). The Warrant Shares so purchased shall be deemed to
be issued to the Warrantholder or the Warrantholder’s
designee, as the record owner of such shares, as of the close of
business on the date on which this Warrant shall have been
surrendered (or evidence of loss, theft or destruction thereof and
security or indemnity satisfactory to the Company), the Warrant
Price shall have been paid and the completed Exercise Agreement
shall have been delivered. Certificates for the Warrant Shares so
purchased, representing the aggregate number of shares specified in
the Exercise Agreement, shall be delivered to the Warrantholder
within a reasonable time, not exceeding three (3) business days,
after this Warrant shall have been so exercised. The certificates
so delivered shall be in such denominations as may be requested by
the Warrantholder and shall be registered in the name of the
Warrantholder or such other name as shall be designated by the
Warrantholder, subject to the restrictions on transfer set forth in
this Warrant. If this Warrant shall have been exercised only in
part, then, unless this Warrant has expired, the Company shall, at
its expense, at the time of delivery of such certificates, deliver
to the Warrantholder a new Warrant representing the number of
shares with respect to which this Warrant shall not then have been
exercised. As used herein, “business day” means a day,
other than a Saturday or Sunday, on which banks in New York City
are open for the general transaction of business. Each exercise
hereof shall constitute the re-affirmation by the Warrantholder
that the representations and warranties contained in Section 5 of
the Purchase Agreement (as defined below) are true and correct with
respect to the Warrantholder as of the time of such
exercise.
Section
4. Compliance with the Securities Act of 1933 . Except as
provided in the Purchase Agreement (as defined below), the Company
may cause the legend set forth on the first page of this Warrant to
be set forth on each Warrant or similar legend on any security
issued or issuable upon exercise of this Warrant, unless counsel
for the Company is of the opinion as to any such security that such
legend is unnecessary.
Section
5. Payment of Taxes . The Company will pay any documentary
stamp taxes attributable to the initial issuance of Warrant Shares
issuable upon the exercise of the Warrant; provided, however, that
the Company shall not be required to pay any tax or taxes which may
be payable in respect of any transfer involved in the issuance or
delivery of any certificates for Warrant Shares in a name other
than that of the Warrantholder in respect of which such shares are
issued, and in such case, the Company shall not be required to
issue or deliver any certificate for Warrant Shares or any Warrant
until the person requesting the same has paid to the Company the
amount of such tax or has established to the Company’s
reasonable satisfaction that such tax has been paid. The
Warrantholder shall be responsible for income taxes due under
federal, state or other law, if any such tax is due.
Section
6. Mutilated or Missing Warrants . In case this Warrant
shall be mutilated, lost, stolen, or destroyed, the Company shall
issue in exchange and substitution of and upon cancellation of the
mutilated Warrant, or in lieu of and substitution for the Warrant
lost, stolen or destroyed, a new Warrant of like tenor and for the
purchase of a like number of Warrant Shares, but only upon receipt
of evidence reasonably satisfactory to the Company of such loss,
theft or destruction of the Warrant, and with respect to a lost,
stolen or destroyed Warrant, reasonable indemnity or bond with
respect thereto, if requested by the Company.
Section
7. Reservation of Common Stock . The Company hereby
represents and warrants that there have been reserved, and the
Company shall at all applicable times keep reserved until issued
(if necessary) as contemplated by this Section 7, out of the
authorized and unissued shares of Common Stock, sufficient shares
to provide for the exercise of the rights of purchase represented
by this Warrant. The Company agrees that all Warrant Shares issued
upon due exercise of the Warrant shall be, at the time of delivery
of the certificates for such Warrant Shares, duly authorized,
validly issued, fully paid and non-assessable shares of Common
Stock of the Company.
Section
8. Adjustments . Subject and pursuant to the provisions of
this Section 8, the Warrant Price and number of Warrant Shares
subject to this Warrant shall be subject to adjustment from time to
time as set forth hereinafter.
(a)
If the Company shall, at any time or from time to time while this
Warrant is outstanding, pay a dividend or make a distribution on
its Common Stock in shares of Common Stock, subdivide its
outstanding shares of Common Stock into a greater number of shares
or combine its outstanding shares of Common Stock into a smaller
number of shares or issue by reclassification of its outstanding
shares of Common Stock any shares of its capital stock (including
any such reclassification in connection with a consolidation or
merger in which the Company is the continuing corporation), then
the number of Warrant Shares purchasable upon exercise of the
Warrant and the Warrant Price in effect immediately prior to the
date upon which such change shall become effective, shall be
adjusted by the Company so that the Warrantholder thereafter
exercising the Warrant shall be entitled to receive the number of
shares of Common Stock or other capital stock which the
Warrantholder would have received if the Warrant had been exercised
immediately prior to such event upon payment of a Warrant Price
that has been adjusted to reflect a fair allocation of the
economics of such event to the Warrantholder. Such adjustments
shall be made successively whenever any event listed above shall
occur.
(b)
If any capital reorganization, reclassification of the capital
stock of the Company, consolidation or merger of the Company with
another corporation in which the Company is not the survivor, or
sale, transfer or other disposition of all or substantially all of
the Company’s assets to another corporation shall be
effected, then, as a condition of such reorganization,
reclassification, consolidation, merger, sale, transfer or other
disposition, lawful and adequate provision shall be made whereby
each Warrantholder shall thereafter have the right to purchase and
receive upon the basis and upon the terms and conditions herein
specified and in lieu of the Warrant Shares immediately theretofore
issuable upon exercise of the Warrant, such shares of stock,
securities or assets as would have been issuable or payable with
respect to or in exchange for a number of Warrant Shares equal to
the number of Warrant Shares immediately theretofore issuable upon
exercise of the Warrant, had such reorganization, reclassification,
consolidation, merger, sale, transfer or other disposition not
taken place, and in any such case appropriate provision shall be
made with respect to the rights and interests of each Warrantholder
to the end that the provisions hereof (including, without
limitation, provision for adjustment of the Warrant Price) shall
thereafter be applicable, as nearly equivalent as may be
practicable in relation to any shares of stock, securities or
assets thereafter deliverable upon the exercise hereof. The Company
shall not effect any such consolidation, merger, sale, transfer or
other disposition unless prior to or simultaneously with the
consummation thereof the successor corporation (if other than the
Company) resulting from such consolidation or merger, or the
corporation purchasing or otherwise acquiring such assets or other
appropriate corporation or entity shall assume the obligation to
deliver to the Warrantholder, at the last address of the
Warrantholder appearing on the books of the Company, such shares of
stock, securities or assets as, in accordance with the foregoing
provisions, the Warrantholder may be entitled to purchase, and the
other obligations under this Warrant. The provisions of this
paragraph (b) shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers, sales, transfers or
other dispositions.
(c)
In case the Company shall fix a payment date for the making of a
distribution to all holders of Common Stock (including any such
distribution made in connection with a consolidation or merger in
which the Company is the continuing corporation) of evidences of
indebtedness or assets (other than cash dividends or cash
distributions payable out of consolidated earnings or earned
surplus or dividends or distributions referred to in Section 8(a)),
or subscription rights or warrants, the Warrant Price to be in
effect after such payment date shall be determined by multiplying
the Warrant Price in effect immediately prior to such payment date
by a fraction, the numerator of which shall be the total number of
shares of Common Stock outstanding multiplied by the Market Price
(as defined below) per share of Common Stock immediately prior to
such payment date, less the fair market value (as determined by the
Company’s Board of Directors in good faith) of said assets or
evidences of indebtedness so distributed, or of such subscription
rights or warrants, and the denominator of which shall be the total
number of shares of Common Stock outstanding multiplied by such
Market Price per share of Common Stock immediately prior to such
payment date. “Market Price” as of a particular date
(the “Valuation Date”) shall mean the following: (a) if
the Common Stock is then listed on a national stock exchange, the
closing sale price of one share of Common Stock on such exchange on
the last trading day prior to the Valuation Date; (b) if the Common
Stock is then quoted on the Nasdaq National Market System or the
Nasdaq SmallCap Market (in either case, “Nasdaq”), the
National Association of Securities Dealers, Inc. OTC Bulletin Board
(the “Bulletin Board”) or such similar exchange or
association, the closing sale price of one share of Common Stock on
Nasdaq, the Bulletin Board or such other exchange or association on
the last trading day prior to the Valuation Date or, if no such
closing sale price is available, the average of the high bid and
the low asked price quoted thereon on the last trading day prior to
the Valuation Date; or (c) if the Common Stock is not then listed
on a national stock exchange or quoted on Nasdaq, the Bulletin
Board or such other exchange or association, the fair market value
of one share of Common Stock as of the Valuation Date, shall be
determined in good faith by the Board of Directors of the Company
and the Warrantholder. If the Common Stock is not then listed on a
national securities exchange, the Bulletin Board or such other
exchange or association, the Board of Directors of the Company
shall respond promptly, in writing, to an inquiry by the
Warrantholder prior to the exercise hereunder as to the fair market
value of a share of Common Stock as determined by the Board of
Directors of the Company. In the event that the Board of Directors
of the Company and the Warrantholder are unable to agree upon the
fair market value in respect of subpart (c) hereof, the Company and
the Warrantholder shall jointly select an appraiser, who is
experienced in such matters. The decision of such appraiser shall
be final and conclusive, and the cost of such appraiser shall be
borne equally by the Company and the Warrantholder. Such adjustment
shall be made successively whenever such a payment date is
fixed.
(d)
An adjustment to the Warrant Price shall become effective
immediately after the payment date in the case of each dividend or
distribution and immediately after the effective date of each other
event which requires an adjustment.
(e)
In the event that, as a result of an adjustment made pursuant to
this Section 8, the Warrantholder shall become entitled to receive
any shares of capital stock of the Company other than shares of
Common Stock, the number of such other shares so receivable upon
exercise of this Warrant shall be subject thereafter to adjustment
from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Warrant Shares
contained in this Warrant.
(f)
Except as provided in subsection (g) hereof, if and whenever the
Company shall issue or sell, or is, in accordance with any of
subsections (f)(l) through (f)(7) hereof, deemed to have issued or
sold, any shares of Common Stock for no consideration or for a
consideration per share less than the Warrant Price in effect
immediately prior to the time of such issue or sale, then and in
each such case (a “ Trigger Issuance ”) the
then-existing Warrant Price, shall be reduced, as of the close of
business on the effective date of the Trigger Issuance, to a price
determined as follows:
|
|
|
|
|
Adjusted
Warrant Price = (A x B) + D
A+C
|
|
|
"A"
equals the number of shares of Common Stock outstanding, including
Additional Shares of Common Stock (as defined below) deemed to be
issued hereunder, immediately preceding such Trigger
Issuance;
|
|
|
“B”equals
the Warrant Price in effect immediately preceding such Trigger
Issuance;
|
|
|
"C"
equals the number of Additional Shares of Common Stock issued or
deemed issued hereunder as a result of the Trigger Issuance;
and
|
|
|
"D"
equals the aggregate consideration, if any, received or deemed to
be received by the Company upon such Trigger Issuance;
|
provided, however, that in no
event shall the Warrant P