Document:

Exhibit 10.5

 Exhibit 10.5 
  
 AGREEMENT AND AMENDMENT NO. 3 
 TO AGREEMENT AND PLAN OF MERGER 
  
 Agreement and Amendment No. 3 dated as of September 8, 2004 (this “Agreement”) relating to the Agreement and Plan of Merger (as amended from time to time, the “Merger Agreement”) dated as of July 2, 2003
among BTI Telecom Corp., ITC^DeltaCom, Inc., 8DBC1 Corp. and the WCAS Securityholders named therein. Capitalized terms used herein and not otherwise defined shall have the meanings assigned to such terms in the Merger Agreement. 
  
 The parties hereto agree as follows: 
  
 1. Section 8.21 of the Merger Agreement shall terminate automatically and
without any further action by any of the parties, and the WCAS Securityholders shall thenceforth have no further obligations thereunder, if, on or prior to the expiration of the Commitment Period, Parent shall have consummated either (i) the
acquisition by merger of Florida Digital Network, Inc. pursuant to an Agreement and Plan of Merger dated as of the date hereof, as it may be amended from time to time, by and among Parent, Boatramp Co., a Delaware corporation and a wholly owned
subsidiary of Parent, Florida Digital Network, Inc. and certain stockholders of Florida Digital Network, Inc. listed on the signature pages thereof, or (ii) the acquisition by merger of NT Corporation pursuant to an Agreement and Plan of Merger
dated as of the date hereof, as it may be amended from time to time, by and among Parent, Boatramp Co., a Delaware corporation and a wholly owned subsidiary of Parent, NT Corporation and certain stockholders of NT Corporation listed on the signature
pages thereof. 
  
 2. Any provision of this Agreement and
Amendment No. 3 may be amended or waived only with the written consent of each party hereto. This Agreement and Amendment No. 3 shall not constitute an amendment or modification of any provision of the Merger Agreement not expressly referred to
herein. Except as expressly amended or modified herein, the provisions of the Merger Agreement are and shall remain in full force and effect. Each reference to “hereof,” “hereunder,” “herein” and “hereby” and
each other similar reference and each reference to “this Agreement” and each other similar reference contained in the Merger Agreement shall refer to the Merger Agreement as amended hereby. 
  
 3. This Agreement and Amendment No. 3 and the rights of the parties under it
will be governed by and construed in all respects in accordance with the laws of the state of New York. The parties hereto hereby irrevocably waive any and all rights to trial by jury in any legal proceeding arising out of or related to this
Agreement and Amendment No. 3. 
  
 [signature pages follow]

  

 IN WITNESS WHEREOF, the parties have executed this Amendment as of the date set forth in the first
paragraph hereof. 
  

			
	 COMPANY:

	
	 ITC^DELTACOM, INC.

		
	By:	 	 /s/ Douglas A. Shumate

	 Name:
	 	 Douglas A. Shumate

	 Title:
	 	 Senior Vice President and
 Chief Financial Officer

	
	[signatures of WCAS Securityholders on following pages]

  

			
	WCAS CAPITAL PARTNERS III, L.P.
		
	 By:
	 	 WCAS CP III Associates L.L.C.,
 General Partner

		
	 By:
	 	 /s/ Jonathan M. Rather

	 	 	 Name: Jonathan M. Rather

	 	 	 Title: Managing Member

  

			
	WELSH, CARSON, ANDERSON & STOWE VIII, L.P.
		
	 By:
	 	 WCAS VIII Associates LLC,
 General Partner

		
	 By:
	 	 /s/ Jonathan M. Rather

	 	 	 Name: Jonathan M. Rather

	 	 	 Title: Managing Member

  

			
	WCAS INFORMATION PARTNERS, L.P.
		
	 By:
	 	 WCAS Info Partners,
 General Partner

		
	 By:
	 	 /s/ Jonathan M. Rather

	 	 	 Name: Jonathan M. Rather

	 	 	 Title: Attorney-in-fact

  

					
	 	 	Individual investors and trusts:
			
	 	 	By:	 	 /s/ Jonathan M. Rather

	 	 	 	 	 Jonathan M. Rather, as
 Attorney-in-fact for the
 individual investors listed below:
 Patrick J. Welsh
 Russell L. Carson
 Bruce K. Anderson
 Andrew M. Paul
 Thomas E. McInerney
 Robert A. Minicucci
 Anthony J. de Nicola
 Paul B. Queally
 D. Scott Mackesy
 Sanjay Swani
 James Matthews
 Laura VanBuren
 Sean Traynor
 John Almeida
 Eric J. Lee
 Jonathan M. Rather
 IRA – f/b/o James Matthews
 IRA f/b/o Jonathan M. Rather

	
	 Address of each of the WCAS Securityholders

	 Welsh, Carson, Anderson & Stowe
 320 Park
Avenue, Suite 2500
 New York, NY 10022Warrant to Purchase Common Stock of Microvision, Inc.

 EXHIBIT 4.1 
  
 THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAW, AND MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS A REGISTRATION STATEMENT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS SHALL BE
EFFECTIVE WITH RESPECT THERETO, OR AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN CONNECTION WITH SUCH OFFER, SALE OR TRANSFER. SUBJECT TO COMPLIANCE WITH THE REQUIREMENTS OF THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, THIS WARRANT AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY BE PLEDGED OR HYPOTHECATED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY THIS WARRANT OR ANY OF
THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT. 
  
 WARRANT 
  
 TO PURCHASE COMMON STOCK

  
 OF 
  
 MICROVISION, INC. 
  

			
	Issue Date: September 10, 2004	 	Warrant No. 76

  
 THIS CERTIFIES that
SATELLITE STRATEGIC FINANCE ASSOCIATES, LLC or any subsequent holder hereof (the “Holder”), has the right to purchase from MICROVISION, INC., a Delaware corporation (the “Company”), upon the terms and subject to the
limitations on exercise and the conditions hereinafter set forth, up to 361,795 fully paid and nonassessable shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), subject to adjustment as
provided herein, at a price per share equal to the Exercise Price (as defined below), at any time and from time to time beginning on the date on which this Warrant is originally issued (the “Issue Date”) and ending at 6:00 p.m.,
eastern time, on the date that is the fifth (5th) anniversary of the Issue Date (or, if such date is not a Business
Day, on the Business Day immediately following such date) (the “Expiration Date”). This Warrant is issued pursuant to a Securities Purchase Agreement, dated as of September 9, 2004 (the “Securities Purchase
Agreement”). Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Securities Purchase Agreement. 

 1. Exercise. 
  
 (a) Right to Exercise; Exercise Price. The Holder shall have the right to exercise this Warrant at any time and from
time to time during the period beginning on the Issue Date and ending on the Expiration Date as to all or any part of the shares of Common Stock covered hereby (the “Warrant Shares”). The “Exercise Price” for each
Warrant Share purchased by the Holder upon the exercise of this Warrant shall be equal to $8.16, subject to adjustment for the events specified in Section 6 below.  
  
 (b) Exercise Notice. In order to exercise this Warrant, the Holder shall send to the Company by facsimile
transmission, at any time prior to 6:00 p.m., eastern time, on the Business Day on which the Holder wishes to effect such exercise (the “Exercise Date”), (i) a notice of exercise in substantially the form attached hereto as Exhibit
A (the “Exercise Notice”), and (ii) a copy of the original Warrant, and, in the case of a Cash Exercise (as defined below), the Holder shall pay the Exercise Price to the Company by wire transfer. The Exercise Notice shall state the
name or names in which the shares of Common Stock that are issuable on such exercise shall be issued. In the case of a dispute between the Company and the Holder as to the calculation of the Exercise Price or the number of Warrant Shares issuable
hereunder (including, without limitation, the calculation of any adjustment pursuant to Section 6 below), the Company shall issue to the Holder the number of Warrant Shares that are not disputed within the time periods specified in Section 2 below
and shall submit the disputed calculations to a certified public accounting firm of national reputation (other than the Company’s regularly retained accountants) within three (3) Business Days following the Company’s receipt of the
Holder’s Exercise Notice. The Company shall cause such accountant to calculate the Exercise Price and/or the number of Warrant Shares issuable hereunder and to notify the Company and the Holder of the results in writing no later than three (3)
Business Days following the day on which such accountant received the disputed calculations (the “Dispute Procedure”). Such accountant’s calculation shall be deemed conclusive absent manifest error. The fees of any such
accountant shall be borne by the party whose calculations were most at variance with those of such accountant. 
  
 (c) Holder of Record. The Holder shall, for all purposes, be deemed to have become the holder of record of the Warrant Shares specified in an
Exercise Notice on the related Exercise Date, irrespective of the date of delivery of such Warrant Shares. Except as specifically provided herein, nothing in this Warrant shall be construed as conferring upon the Holder hereof any rights as a
stockholder of the Company prior to the Exercise Date. 
  
 (d)
Cancellation of Warrant. This Warrant shall be canceled upon its exercise in full and, if this Warrant is exercised in part, the Company shall, at the time that it delivers Warrant Shares to the Holder pursuant to such exercise as provided
herein, issue a new warrant, and deliver to the Holder a certificate representing such new warrant, with terms identical in all respects to this Warrant (except that such new warrant shall be exercisable into the number of shares of Common Stock
with respect to which this Warrant shall remain unexercised); provided, however, that the Holder shall be entitled to exercise all or any portion of such new warrant at any time following the time at which this Warrant is exercised,
regardless of whether the Company has actually issued such new warrant or delivered to the Holder a certificate therefor. 
  

 -2- 

 2. Delivery of Warrant Shares Upon Exercise. Upon receipt of an Exercise Notice pursuant to
Section 1 above, the Company shall, (A) in the case of a Cash Exercise, no later than the close of business on the later to occur of (i) the third (3rd) Business Day following the related Exercise Date and (ii) such later date on which the Company
shall have received payment of the Exercise Price, (B) in the case of a Cashless Exercise (as defined below), no later than the close of business on the third (3rd) Business Day following the related Exercise Date, and (C) with respect to Warrant
Shares that are the subject of a Dispute Procedure, the close of business on the third (3rd) Business Day following the determination made pursuant to Section 1(b) (each of the dates specified in (A), (B) or (C) being referred to as a
“Delivery Date”), issue and deliver or caused to be delivered to the Holder the number of Warrant Shares as shall be determined as provided herein. As long as the Company’s transfer agent (“Transfer Agent”)
participates in the Depository Trust Company (“DTC”) Fast Automated Securities Transfer program (“FAST”), and except as otherwise provided in the next following sentence of this Section 2, the Company shall effect
delivery of Warrant Shares to the Holder by crediting the account of the Holder or its nominee at DTC (as specified in the applicable Exercise Notice) with the number of Warrant Shares required to be delivered, no later than the close of business on
such Delivery Date. In the event that the Transfer Agent is not a participant in FAST, or if the Warrant Shares are not otherwise eligible for delivery through FAST, or if the Holder so specifies in an Exercise Notice or otherwise in writing on or
before the Exercise Date, the Company shall effect delivery of Warrant Shares by delivering to the Holder or its nominee physical certificates representing such Warrant Shares, no later than the close of business on such Delivery Date. Warrant
Shares delivered to the Holder shall not contain any restrictive legend as long as the resale of such Warrant Shares (x) has been or will be made (as certified in writing by the Holder to the Company) pursuant to an effective Registration Statement
(as defined in the Registration Rights Agreement), (y) has been made pursuant to Rule 144, or (z) may be made pursuant to Rule 144(k) or any successor rule or provision. 
  
 3. Failure to Deliver Warrant Shares. 
  
 (a) In the event that the Company fails for any reason to deliver to the Holder the number of Warrant Shares specified in
the applicable Exercise Notice on or before the Delivery Date therefor (an “Exercise Default”), the Company shall pay to the Holder payments (“Exercise Default Payments”) in the amount of (i) (N/365) multiplied
by (ii) the aggregate Exercise Price of the Warrant Shares which are the subject of such Exercise Default multiplied by (iii) the lower of twelve percent (12%) per annum and the maximum rate permitted by applicable law (the
“Default Interest Rate”), where “N” equals the number of days elapsed between the original Delivery Date of such Warrant Shares and the date on which all of such Warrant Shares are issued and delivered to the Holder. Cash
amounts payable hereunder shall be paid on or before the fifth (5th) Business Day of each calendar month following the calendar month in which such amount has accrued. 
  
 (b) In the event of an Exercise Default, the Holder may, upon written notice to the Company, regain on the date of such
notice the rights of the Holder under the exercised portion of this Warrant that is the subject of such Exercise Default. In such event, the Holder shall retain all of the Holder’s rights and remedies with respect to the Company’s failure
to deliver such Warrant Shares (including without limitation the right to receive the cash payments specified in Section 3(a) above); provided, however, that such cash payments shall cease to accrue effective as of the date of such
notice. 
  

 -3- 

 (c) The Holder’s rights and remedies hereunder are cumulative, and no right or remedy is exclusive
of any other. In addition to the amounts specified herein, the Holder shall have the right to pursue all other remedies available to it at law or in equity (including, without limitation, a decree of specific performance and/or injunctive relief).
Nothing herein shall limit the Holder’s right to pursue actual damages for the Company’s failure to issue and deliver Warrant Shares on the applicable Delivery Date (including, without limitation, damages relating to any purchase of Common
Stock by the Holder to make delivery on a sale effected in anticipation of receiving Warrant Shares upon exercise, such damages to be in an amount equal to (A) the aggregate amount paid by the Holder for the Common Stock so purchased minus
(B) the aggregate amount of net proceeds, if any, received by the Holder from the sale of the Warrant Shares issued by the Company pursuant to such exercise). 
  

4. Exercise Limitations. In no event shall a Holder be permitted to exercise this Warrant, or part hereof, if, upon such exercise, either:

  
 (a) the number of shares of Common Stock beneficially owned
by the Holder (other than shares which would otherwise be deemed beneficially owned except for being subject to a limitation on conversion or exercise analogous to the limitation contained in this Section 4(a)), would exceed 4.99% of the number of
shares of Common Stock then issued and outstanding. As used herein, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules thereunder. To the extent that the
limitation contained in this Section 4(a) applies, the submission of an Exercise Notice by the Holder shall be deemed to be the Holder’s representation that this Warrant is exercisable pursuant to the terms hereof and the Company shall be
entitled to rely on such representation without making any further inquiry as to whether this Section 4(a) applies. Nothing contained herein shall be deemed to restrict the right of a Holder to exercise this Warrant, or part thereof, at such time as
such exercise will not violate the provisions of this Section 4(a). This Section 4(a) may not be amended unless such amendment is approved by the holders of a majority of the Common Stock then outstanding; provided, however, that the
limitations contained in this Section 4(a) shall cease to apply (x) upon sixty (60) days’ prior written notice from the Holder to the Company, or (y) immediately upon written notice from the Holder to the Company at any time after the public
announcement or other disclosure of a Major Transaction (as defined below) or a Change of Control; or 
  
 (b) unless Stockholder Approval (as defined below) has been obtained, the number of Warrant Shares that such Holder would receive upon such exercise, when
added to the sum of (i) the number of Warrant Shares previously received by such Holder pursuant to this Warrant, plus (ii) the number of shares of Common Stock previously received by such Holder upon conversion of the Preferred Shares, would exceed
the product of (A) the Cap Amount (as defined in the Certificate) multiplied by (B) a fraction, the numerator of which is the number of Warrant Shares originally issuable under this Warrant and the denominator of which is the aggregate number
of Warrant Shares originally issuable under this Warrant and the other Warrants (such product, the “Allocation Amount”). In the event that any Investor to which this Warrant was originally issued shall sell or otherwise transfer any
part of this Warrant, the remaining shares of 
  

 -4- 

 Common Stock constituting such transferring Investor’s Allocation Amount shall be allocated between the transferring
Investor and the transferee in proportion to amount of this Warrant being transferred. In the event that, at any time, sum of (i) the aggregate number of Warrant Shares issuable under this Warrant (without regard to any restrictions on such
issuance) plus (ii) the aggregate number of shares of Common Stock issuable upon conversion of Preferred Shares owned by the Holder (without regard to any restrictions on such conversion), plus (iii) the number of shares of Common Stock previously
issued to the Holder upon the conversion of Preferred Shares and the number of Warrant Shares previously issued to the Holder, exceeds ninety percent (90%) of the Holder’s Allocation Amount, the Company shall, upon the written request of the
Holder, hold as promptly as reasonably practicable a special meeting of its stockholders for the purpose of obtaining, and use its best efforts to obtain, Stockholder Approval. In the event that the stockholders do not approve such transactions at
such meeting, the Company shall continue to use its best efforts to seek such approval as soon as practicable after such meeting, but no less frequently than annually thereafter. “Stockholder Approval” means the affirmative vote of
the holders of a majority of the votes cast at a meeting of stockholders approving the issuance of shares of Common Stock in excess of the Cap Amount. 
  
 5. Payment of the Exercise Price; Cashless Exercise. The Holder may pay the Exercise Price in either of the following forms or, at the election of
Holder, a combination thereof: 
  
 (a) through a cash exercise (a
“Cash Exercise”) by delivering immediately available funds, or 
  
 (b) if an effective Registration Statement is not available for the resale of all of the Warrant Shares issuable hereunder at the time an Exercise Notice is delivered to the Company, through a cashless exercise (a
“Cashless Exercise”), as hereinafter provided. The Holder may effect a Cashless Exercise by surrendering this Warrant to the Company and noting on the Exercise Notice that the Holder wishes to effect a Cashless Exercise, upon which
the Company shall issue to the Holder the number of Warrant Shares determined as follows: 
  
 X = Y x (A-B)/A 
  

	where:      	X = the number of Warrant Shares to be issued to the Holder; 

  
 Y = the number of Warrant Shares with respect to which this Warrant is being exercised; 
  
 A = the Market Price (as defined in the Certificate) as of the Exercise
Date; and 
  
 B = the Exercise Price. 
  
 For purposes of Rule 144, it is intended and acknowledged that the Warrant Shares issued in a
Cashless Exercise transaction shall be deemed to have been acquired by the Holder, and the holding period for the Warrant Shares required by Rule 144 shall be deemed to have been commenced, on the Issue Date. 
  

 -5- 

 6. Anti-Dilution Adjustments; Distributions; Other Events. The Exercise Price and the number of
Warrant Shares issuable hereunder shall be subject to adjustment from time to time as provided in this Section 6. In the event that any adjustment of the Exercise Price required herein results in a fraction of a cent, the Exercise Price shall be
rounded up or down to the nearest one hundredth of a cent. 
  
 (a)
Subdivision or Combination of Common Stock. If the Company, at any time after the Execution Date (as defined in the Securities Purchase Agreement), subdivides (by any stock split, stock dividend, recapitalization, reorganization,
reclassification or otherwise) the outstanding shares of Common Stock into a greater number of shares, then effective upon the close of business on the record date for effecting such subdivision, the Exercise Price in effect immediately prior to
such subdivision will be proportionately reduced. If the Company, at any time after the Issue Date, combines (by reverse stock split, recapitalization, reorganization, reclassification or otherwise) the outstanding shares of Common Stock into a
smaller number of shares, then, effective upon the close of business on the record date for effecting such combination, the Exercise Price in effect immediately prior to such combination will be proportionally increased. 
  
 (b) Distributions. If the Company shall declare or make any
distribution of cash or any other assets (or rights to acquire such assets) to holders of Common Stock, as a partial liquidating dividend or otherwise, including without limitation any dividend or distribution to the Company’s stockholders in
shares (or rights to acquire shares) of capital stock of a subsidiary) (a “Distribution”), the Company shall deliver written notice of such Distribution (a “Distribution Notice”) to the Holder at least thirty (30)
days prior to the earlier to occur of (i) the record date for determining stockholders entitled to such Distribution (the “Record Date”) and (ii) the date on which such Distribution is made (the “Distribution
Date”). In the Distribution Notice to a Holder, the Company must indicate whether the Company has elected (A) to deliver to such Holder the same amount and type of assets being distributed in such Distribution as though the Holder were a
holder on the Determination Date therefor of a number of shares of Common Stock into which the this Warrant is exercisable as of such Determination Date (such number of shares to be determined at the Exercise Price then in effect and without giving
effect to any limitations on such exercise) or (B) to reduce the Exercise Price as of the Determination Date therefor by an amount equal to the fair market value of the assets to be distributed divided by the number of shares of Common Stock
as to which such Distribution is to be made, such fair market value to be reasonably determined in good faith by the independent members of the Company’s Board of Directors. If the Company does not notify the Holders of its election pursuant to
the preceding sentence within two (2) Business Days following the date on which the Company publicly announces a Distribution, the Company shall be deemed to have elected clause (A) of the preceding sentence. 
  
 (c) Dilutive Issuances. 
  
 (i) Adjustment Upon Dilutive Issuance. If, at any time after the
Issue Date, the Company issues or sells, or in accordance with subparagraph (iii) of this paragraph (c), is deemed to have issued or sold, any shares of Common Stock for per share consideration less than 
  

 -6- 

 the Exercise Price on the date of such issuance or sale (a “Dilutive Issuance”), then the Exercise Price
shall be adjusted as follows: 
  
 (A) If such
Dilutive Issuance occurs prior to the Effective Date (as defined in the Registration Rights Agreement), then effective immediately upon the Dilutive Issuance, the Exercise Price shall be adjusted so as to equal the consideration received or
receivable by the Company (on a per share basis) for the additional shares of Common Stock so issued, sold or deemed issued or sold in such Dilutive Issuance (which, in the case of a deemed issuance or sale, shall be calculated in accordance with
subparagraph (iii) below). 
  
 (B) If such
Dilutive Issuance occurs on or after the Effective Date, then effective immediately upon the Dilutive Issuance, the Exercise Price shall be adjusted so as to equal an amount determined by multiplying such Exercise Price by the following fraction:

  
 N0 + N1 
  
 N0 + N2 
  
 where: 
  

			
	 N0 =
	 	the number of shares of Common Stock outstanding immediately prior to the issuance, sale or deemed issuance or sale of such additional shares of Common Stock in such Dilutive Issuance
(without taking into account any shares of Common Stock issuable upon conversion, exchange or exercise of any securities or other instruments which are convertible into or exercisable or exchangeable for Common Stock (“Convertible
Securities”) or options, warrants or other rights to purchase or subscribe for Common Stock or Convertible Securities (“Purchase Rights”) other than shares of Common Stock issuable under the Preferred Shares and the Warrants, which
shall be taken into account in determining such number);
	  
 N1 =
	 	the number of shares of Common Stock which the aggregate consideration, if any, received or receivable by the Company for the total number of such additional shares of Common Stock so issued,
sold or deemed issued or sold in such Dilutive Issuance (which, in the case of a deemed issuance or sale, shall be calculated in accordance with subparagraph (iii) below) would purchase at the Exercise Price in effect immediately prior to such
Dilutive Issuance; and
		
	 N2 =
	 	the number of such additional shares of Common Stock so issued, sold or deemed issued or sold in such Dilutive Issuance.

  

 -7- 

 Notwithstanding the foregoing, no adjustment shall be made pursuant hereto if such adjustment would result in an increase
in the Exercise Price. 
  
 (ii) Adjustment Upon Below Market
Issuance. If, at any time after the Issue Date, the Company issues or sells, or in accordance with subparagraph (iii) of this paragraph (c), is deemed to have issued or sold, any shares of Common Stock for per share consideration less than an
amount equal to 95% of the Five (5) Day VWAP (as defined in the Certificate) on the date of such issuance or sale (or deemed issuance or sale) (a “Below Market Issuance”), then effective immediately upon the Dilutive Issuance, the
Exercise Price shall be adjusted so as to equal an amount determined by multiplying such Exercise Price by the following fraction: 
  
 N0 +
N1 
  
 N0 + N2 
  
 where: 
  

			
		
	 N0 =
	 	the number of shares of Common Stock outstanding immediately prior to the issuance, sale or deemed issuance or sale of such additional shares of Common Stock in such Below Market Issuance
(without taking into account any shares of Common Stock issuable upon conversion, exchange or exercise of any Convertible Securities or Purchase Rights, other than shares of Common Stock issuable under the Preferred Shares and the Warrants, which
shall be taken into account in determining such number);
		
	 N1 =
	 	the number of shares of Common Stock which the aggregate consideration, if any, received or receivable by the Company for the total number of such additional shares of Common Stock so issued,
sold or deemed issued or sold in such Below Market Issuance (which, in the case of a deemed issuance or sale, shall be calculated in accordance with subparagraph (iii) below) would purchase at the Five (5) Day VWAP in effect on the date of such
Below Market Issuance; and
		
	 N2 =
	 	the number of such additional shares of Common Stock so issued, sold or deemed issued or sold in such Below Market Issuance.

  
 Notwithstanding the foregoing, no
adjustment shall be made pursuant to this paragraph (c)(ii) if such adjustment would result in an increase in the Exercise Price. In the event that the Company effects an issuance that is both a Dilutive Issuance and a Below Market Issuance, the
Exercise Price will be adjusted to the lower of the prices calculated pursuant to subparagraphs (i) and (ii) of this paragraph (c). 
  

 -8- 

 (iii) Effect On Exercise Price Of Certain Events. For purposes of determining the adjusted
Exercise Price under subparagraph (i) or (ii) of this paragraph (c), the following will be applicable: 
  
 (A) Issuance Of Purchase Rights. If the Company issues or sells any Purchase Rights, whether or not immediately exercisable, and
the price per share for which Common Stock is issuable upon the exercise of such Purchase Rights (and the price of any conversion of Convertible Securities, if applicable) is less than either or both of an amount equal to 95% of the Five (5) Day
VWAP and the Exercise Price in effect on the date of issuance or sale of such Purchase Rights, then the maximum total number of shares of Common Stock issuable upon the exercise of all such Purchase Rights (assuming full conversion, exercise or
exchange of Convertible Securities, if applicable) shall, as of the date of the issuance or sale of such Purchase Rights, be deemed to be outstanding and to have been issued and sold by the Company for such price per share. For purposes of the
preceding sentence, the “price per share for which Common Stock is issuable upon the exercise of such Purchase Rights” shall be determined by dividing (x) the total amount, if any, received or receivable by the Company as consideration for
the issuance or sale of all such Purchase Rights, plus the minimum aggregate amount of additional consideration, if any, payable to the Company upon the exercise of all such Purchase Rights, plus, in the case of Convertible Securities
issuable upon the exercise of such Purchase Rights, the minimum aggregate amount of additional consideration payable upon the conversion, exercise or exchange thereof (determined in accordance with the calculation method set forth in subparagraph
(iii)(B) below) at the time such Convertible Securities first become convertible, exercisable or exchangeable, by (y) the maximum total number of shares of Common Stock issuable upon the exercise of all such Purchase Rights (assuming full
conversion, exercise or exchange of Convertible Securities, if applicable). No further adjustment to the Exercise Price shall be made upon the actual issuance of such Common Stock upon the exercise of such Purchase Rights or upon the conversion,
exercise or exchange of Convertible Securities issuable upon exercise of such Purchase Rights. 
  
 (B) Issuance Of Convertible Securities. If the Company issues or sells any Convertible Securities, whether or not immediately
convertible, exercisable or exchangeable, and the price per share for which Common Stock is issuable upon such conversion, exercise or exchange is less than either or both of an amount equal to 95% of the Five (5) Day VWAP and the Exercise Price in
effect on the date of issuance or sale of such Convertible Securities, then the maximum total number of shares of Common Stock issuable upon the conversion, exercise or exchange of all such Convertible Securities shall, as of the date of the
issuance or sale of such Convertible Securities, be deemed to be outstanding and to have been issued and sold by the Company for such price per share. If the Convertible Securities so issued or sold do not have a fluctuating conversion or exercise
price or exchange ratio, then for the purposes of the immediately preceding sentence, the “price per share for which Common Stock is issuable upon such conversion, exercise or exchange” shall be determined by dividing (x) the total amount,
if any, received or receivable by the Company as consideration for the issuance or sale of all such Convertible Securities, plus the minimum aggregate amount of additional consideration, if any, payable to the Company upon the conversion, exercise
or exchange thereof (determined in accordance with the calculation method set forth in this subparagraph (iii)(B)), by (y) the maximum total number of shares of Common Stock issuable upon the exercise, conversion or exchange of all such Convertible
Securities. If the Convertible Securities so issued or sold have a fluctuating conversion or exercise 
  

 -9- 

 price or exchange ratio (a “Variable Rate Convertible Security”) (provided,
however, that if the conversion or exercise price or exchange ratio of a Convertible Security may fluctuate solely as a result of provisions designed to protect against dilution, such Convertible Security shall not be deemed to be a Variable
Rate Convertible Security), then for purposes of the first sentence of this subparagraph (B), the “price per share for which Common Stock is issuable upon such conversion, exercise or exchange” shall be deemed to be the lowest price per
share which would be applicable (assuming all holding period and other conditions to any discounts contained in such Variable Rate Convertible Security have been satisfied) if the conversion price of such Variable Rate Convertible Security on the
date of issuance or sale thereof were seventy-five percent (75%) of the actual conversion price on such date (the “Assumed Variable Market Price”), and, further, if the conversion price of such Variable Rate Convertible Security at
any time or times thereafter is less than or equal to the Assumed Variable Market Price last used for making any adjustment under this paragraph (c) with respect to any Variable Rate Convertible Security, the Exercise Price in effect at such time
shall be readjusted to equal the Exercise Price which would have resulted if the Assumed Variable Market Price at the time of issuance of the Variable Rate Convertible Security had been seventy-five percent (75%) of the actual conversion price of
such Variable Rate Convertible Security existing at the time of the adjustment required by this sentence. No further adjustment to the Exercise Price shall be made upon the actual issuance of such Common Stock upon conversion, exercise or exchange
of such Convertible Securities. 
  
 (C) Change
In Option Price Or Conversion Rate. If, following an adjustment to the Exercise Price upon the issuance of Purchase Rights or Convertible Securities pursuant to a Dilutive Issuance or a Below Market Issuance, there is a change at any time in (x)
the amount of additional consideration payable to the Company upon the exercise of any Purchase Rights; (y) the amount of additional consideration, if any, payable to the Company upon the conversion, exercise or exchange of any Convertible
Securities; or (z) the rate at which any Convertible Securities are convertible into or exercisable or exchangeable for Common Stock (in each such case, other than under or by reason of provisions designed to protect against dilution), then in any
such case, the Exercise Price in effect at the time of such change shall be readjusted to the Exercise Price which would have been in effect at such time had such Purchase Rights or Convertible Securities still outstanding provided for such changed
additional consideration or changed conversion, exercise or exchange rate, as the case may be, at the time initially issued or sold. 
  
 (D) Calculation Of Consideration Received. If any Common Stock, Purchase Rights or Convertible Securities are issued or sold for
cash, the consideration received therefor will be the amount received by the Company therefore. In case any Common Stock, Purchase Rights or Convertible Securities are issued or sold for a consideration part or all of which shall be other than cash,
including in the case of a strategic or similar arrangement in which the other entity will provide services to the Company, purchase services from the Company or otherwise provide intangible consideration to the Company, the amount of the
consideration other than cash received by the Company (including the net present value of the consideration expected by the Company for the provided or purchased services) shall be the fair market value of such 
  

 -10- 

 consideration, except where such consideration consists of publicly traded securities, in which case the
amount of consideration received by the Company will be the Market Price thereof on the date of receipt. In case any Common Stock, Purchase Rights or Convertible Securities are issued in connection with any merger or consolidation in which the
Company is the surviving corporation, the amount of consideration therefor will be deemed to be the fair market value of such portion of the net assets and business of the non-surviving corporation as is attributable to such Common Stock, Purchase
Rights or Convertible Securities, as the case may be. Notwithstanding anything else herein to the contrary, if Common Stock Purchase Rights or Convertible Securities are issued or sold in conjunction with each other as part of a single transaction
or in a series of related transactions, the Holder may elect to determine the amount of consideration deemed to be received by the Company therefor by deducting the fair value of any type of securities (the “Disregarded Securities”)
issued or sold in such transaction or series of transactions. If the Holder makes an election pursuant to the immediately preceding sentence, no adjustment to the Exercise Price shall be made pursuant to this paragraph (c) for the issuance of the
Disregarded Securities or upon any conversion, exercise or exchange thereof. The independent members of the Company’s Board of Directors shall calculate reasonably and in good faith, using standard commercial valuation methods appropriate for
valuing such assets, the fair market value of any consideration other than cash or securities. 
  
 (E) Issuances Without Consideration Pursuant to Existing Securities. If the Company issues (or becomes obligated to issue) shares
of Common Stock pursuant to any anti-dilution or similar adjustments (other than as a result of stock splits, stock dividends and the like) contained in any Convertible Securities or Purchase Rights outstanding as of the date hereof, then all shares
of Common Stock so issued shall be deemed to have been issued for no consideration. 
  
 (iv) Exceptions To Adjustment Of Exercise Price. Notwithstanding the foregoing, no adjustment to the Exercise Price shall be made pursuant to this paragraph (c) upon the issuance of any Excluded Securities. For
purposes hereof, “Excluded Securities” means (I) securities purchased under the Securities Purchase Agreement; (II) securities issued upon conversion of the Preferred Shares or exercise of the Warrants; (III) shares of Common Stock
issuable or issued to (x) employees or directors from time to time either directly or upon the exercise of options, in such case granted or to be granted by the Board of Directors, pursuant to one or more stock option plans or restricted stock plans
or stock purchase plans in effect as of the Closing Date or approved by the independent members of the Board of Directors or by the Company’s stockholders, or (y) consultants, either directly or pursuant to warrants to purchase Common Stock
that are outstanding on the date hereof or issued hereafter, provided such issuances are approved by the Board of Directors or by the Company’s stockholders; (IV) except as required by subparagraph (c)(ii)(E) above, shares of Common Stock
issued in connection with any Convertible Securities or Purchase Rights outstanding on the date hereof; (V) shares of Common Stock issued to a Person in connection with a joint venture, strategic alliance or other commercial relationship with such
Person relating to the operation of the Company’s business and not for the purpose of raising equity capital; and (VI) securities issued with respect to which the Holders consents that no such adjustment shall be made as a result of such
issuance. 
  

 -11- 

 (v) Notice Of Adjustments. Upon the occurrence of one or more adjustments or readjustments of the
Exercise Price pursuant to this paragraph (c) or any change in the number or type of stock, securities and/or other property issuable upon exercise of this Warrant, the Company, at its expense, shall promptly compute such adjustment or readjustment
or change and prepare and furnish to the Holder a notice (an “Adjustment Notice”) setting forth such adjustment or readjustment or change and showing in detail the facts upon which such adjustment or readjustment or change is based,
and, on or before the time that it delivers an Adjustment Notice, publicly disclose the contents thereof. The failure of the Company to deliver an Adjustment Notice shall not affect the validity of any such adjustment. 
  
 (d) Major Transactions. In the event of a merger, consolidation,
business combination, tender offer, exchange of shares, recapitalization, reorganization, redemption or other similar event, as a result of which shares of Common Stock shall be changed into the same or a different number of shares of the same or
another class or classes of stock or securities or other assets of the Company or another entity or the Company shall sell all or substantially all of its assets (each of the foregoing being a “Major Transaction”), the Company will
give the Holder at least ten (10) Trading Days written notice prior to the earlier of (I) the closing or effectiveness of such Major Transaction and (II) the record date for the receipt of such shares of stock or securities or other assets, and: (i)
the Holder shall be permitted to exercise this Warrant in whole or in part at any time prior to the record date for the receipt of such consideration and shall be entitled to receive, for each share of Common Stock issuable to Holder upon such
exercise, the same per share consideration payable to the other holders of Common Stock in connection with such Major Transaction, and (ii) if and to the extent that the Holder retains any portion of this Warrant following such record date, the
Company will cause the surviving or, in the event of a sale of assets, purchasing entity, as a condition precedent to such Major Transaction, to assume the obligations of the Company under this Warrant, with such adjustments to the Exercise Price
and the securities covered hereby as may be reasonably determined in good faith by the Board of Directors to be necessary in order to preserve the economic benefits of this Warrant to the Holder. 
  
 (e) Adjustments; Additional Shares, Securities or Assets. In the event
that at any time, as a result of an adjustment made pursuant to this Section 6, the Holder of this Warrant shall, upon exercise of this Warrant, become entitled to receive securities or assets (other than Common Stock) then, wherever appropriate,
all references herein to shares of Common Stock shall be deemed to refer to and include such shares and/or other securities or assets; and thereafter the number of such shares and/or other securities or assets shall be subject to adjustment from
time to time in a manner and upon terms as nearly equivalent as practicable to the provisions of this Section 6. Any adjustment made herein pursuant to Section 6(a) that results in a decrease in the Exercise Price shall also effect a proportional
increase in the number of shares of Common Stock into which this Warrant is exercisable. 
  
 7. Fractional Interests. 
  
 No fractional shares or scrip representing fractional shares shall be issuable upon the exercise of this Warrant, but on exercise of this Warrant, the
Holder hereof may purchase only a whole number of shares of Common Stock. If, on exercise of this Warrant, the Holder hereof would be entitled to a fractional share of Common Stock or a right to acquire a fractional 
  

 -12- 

 share of Common Stock, the Company shall, in lieu of issuing any such fractional share, pay to the Holder an amount in
cash equal to the product resulting from multiplying such fraction by the Market Price as of the Exercise Date. 
  
 8. Transfer of this Warrant. 
  
 The Holder may sell, transfer, assign, pledge or otherwise dispose of this Warrant, in whole or in part, as long as such sale or other disposition is made
pursuant to an effective registration statement or an exemption from the registration requirements of the Securities Act. Upon such transfer or other disposition (other than a pledge), the Holder shall deliver this Warrant to the Company together
with a written notice to the Company, substantially in the form of the Transfer Notice attached hereto as Exhibit B (the “Transfer Notice”), indicating the person or persons to whom this Warrant shall be transferred and, if less
than all of this Warrant is transferred, the number of Warrant Shares to be covered by the part of this Warrant to be transferred to each such person. Within three (3) Business Days of receiving a Transfer Notice and the original of this Warrant,
the Company shall deliver to the each transferee designated by the Holder a Warrant or Warrants of like tenor and terms for the appropriate number of Warrant Shares and, if less than all this Warrant is transferred, shall deliver to the Holder a
Warrant for the remaining number of Warrant Shares. 
  
 9.
Benefits of this Warrant. 
  
 This Warrant shall be for
the sole and exclusive benefit of the Holder of this Warrant and nothing in this Warrant shall be construed to confer upon any person other than the Holder of this Warrant any legal or equitable right, remedy or claim hereunder. 
  
 10. Loss, theft, destruction or mutilation of Warrant. 
  
 Upon receipt by the Company of evidence of the loss, theft, destruction or
mutilation of this Warrant, and (in the case of loss, theft or destruction) of indemnity reasonably satisfactory to the Company, and upon surrender of this Warrant, if mutilated, the Company shall execute and deliver a new Warrant of like tenor and
date. 
  
 11. Notice or Demands. 
  
 Any notice, demand or request required or permitted to be given by the
Company or the Holder pursuant to the terms of this Warrant shall be in writing and shall be deemed delivered (i) when delivered personally or by verifiable facsimile transmission, unless such delivery is made on a day that is not a Business Day, in
which case such delivery will be deemed to be made on the next succeeding Business Day, (ii) on the next Business Day after timely delivery to an overnight courier and (iii) on the Business Day actually received if deposited in the U.S. mail
(certified or registered mail, return receipt requested, postage prepaid), addressed as follows: 
  

 -13- 

 If to the Company: 
  
 Microvision, Inc. 
 19910 North Creek Parkway 
 Bothell, WA 98011 
 Attn: General Counsel 
 Tel: (425) 415-6847 
 Fax: (425) 415-6795 
  
 with a copy to: 
  
 Ropes & Gray LLP 
 One International Place

 Boston, MA 02110 
 Attn: Joel
F. Freedman 
 Tel: (617) 951-7000 
 Fax: (617) 951-7050 
  
 and if to the Holder, to such address as shall be
designated by the Holder in writing to the Company. 
  
 12.
Applicable Law. 
  
 This Warrant is issued under and shall
for all purposes be governed by and construed in accordance with the laws of the State of New York applicable to contracts made and to be performed entirely within the State of New York. 
  
 13. Amendments. 
  
 No amendment, modification or other change to, or waiver of any provision of, this Warrant may be made unless such amendment, modification or change is
(A) set forth in writing and is signed by the Company and (B) agreed to in writing by the holders of Warrants exercisable for a majority of the number of shares into which the all of the then outstanding Warrants issued pursuant to the Securities
Purchase Agreement are exercisable (without regard to any limitation contained herein on such exercise), it being understood that upon the satisfaction of the conditions described in (A) and (B) above, each Warrant (including any Warrant held by the
Holder who did not execute the agreement specified in (B) above) shall be deemed to incorporate any amendment, modification, change or waiver effected thereby as of the effective date thereof. 
  

 -14- 

 14. Entire Agreement. 
  
 This Warrant, the Securities Purchase Agreement, the Certificate of Designation, the Registration Rights Agreement, and the
other Transaction Documents constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to
herein and therein. This Warrant, the Securities Purchase Agreement, the Certificate of Designation, the Registration Rights Agreement, and the other Transaction Documents supersede all prior agreements and understandings among the parties hereto
with respect to the subject matter hereof and thereof. 
  
 15.
Headings. 
  
 The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the meaning hereof. 
  
 [Signature Page to Follow] 
  

 -15- 

 IN WITNESS WHEREOF, the Company has duly executed and delivered this Warrant as of the Issue Date.

  

			
	 MICROVISION, INC.
  

	 By:
	 	 /s/ Richard Raisig

	 Name:
	 	 Richard Raisig

	 Title:
	 	 Chief Financial Officer

  

 -16- 

 EXHIBIT A to WARRANT 
  
 EXERCISE NOTICE 
  
 The undersigned Holder hereby irrevocably exercises the right to purchase
             of the shares of Common Stock (“Warrant Shares”) of
                     evidenced by the attached Warrant (the “Warrant”). Capitalized terms used herein and not otherwise
defined shall have the respective meanings set forth in the Warrant. 
  
 1. Form of Exercise Price. The Holder intends that payment of the Exercise Price shall be made as: 
  
              a Cash Exercise with respect to
             Warrant Shares; and/or 
  
              a Cashless Exercise with respect to
             Warrant Shares, as permitted by Section 5(b) of the attached Warrant. 
  
 2. Payment of Exercise Price. In the event that the Holder has elected a Cash Exercise with respect to some or all of the Warrant Shares to be issued
pursuant hereto, the Holder shall pay the sum of $             to the Company in accordance with the terms of the Warrant. 
  

			
	 Date:
	 	  

	 	 	  

	 	 	 Name of Registered Holder
  

	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 

  

 -17- 

 EXHIBIT B to WARRANT 
  
 TRANSFER NOTICE 
  
 FOR VALUE RECEIVED, the undersigned Holder of the attached Warrant hereby sells, assigns and transfers unto the person or persons named below the right to purchase
                     shares of the Common Stock of
                             evidenced by the attached Warrant. 
  

			
	 Date:
	 	  

	 	 	  

	 	 	 Name of Registered Holder
  

	 By:
	 	  

	 Name:
	 	 
	 Title:
	 	 
	  
 Transferee Name and
Address:

	  

	  

	  

  

 -18-

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