Document:

Exhibit 10.2

 

EXHIBIT
C

 

NEITHER THIS SECURITY NOR THE COMMON STOCK OF METRON TECHNOLOGY N.V.
FOR WHICH THIS SECURITY IS EXERCISABLE HAVE BEEN REGISTERED WITH THE SECURITIES
AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE
OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH
SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. 
THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE OF THIS SECURITY
MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
SECURED BY SUCH SECURITIES

 

 

COMMON
SHARE WARRANT

 

To Subscribe for 
                
Common Shares of

 

Metron
Technology N.V.

 

THIS COMMON SHARE PURCHASE WARRANT CERTIFIES that, for
value received,
                         
(the “Holder”), is entitled, upon the terms and subject to the limitations on
exercise and the conditions hereinafter set forth, at any time on or after
August 25, 2003 (the “Initial Exercise Date”) and on or prior to
the earlier of (i) the close of business on the fourth anniversary of the
Initial Exercise Date or (ii) 30 days after the notice of a mandatory
termination of this Warrant pursuant to Section 17 (the “Termination
Date”) but not thereafter, to subscribe for, up to
                           
common shares (the “Common Stock”), par value (based on application of
Section 2:67c of the Netherlands Civil Code) EUR0.44 per share in the
capital of Metron Technology N.V., a corporation incorporated under the laws of
The Netherlands (the “Company”) (such Common Stock hereinafter referred
to as the “Warrant Shares”). The subscription price of one Warrant Share
(the “Exercise Price”) under this Warrant shall be           , subject to adjustment hereunder; provided,
however, that if the Exercise Price (based on the USD/Euro exchange rate
on the date of payment of the Exercise Price) is lower than the par value of
the Common Stock, this Warrant may be exercised at the par value of the Common
Stock.  Capitalized terms used and not otherwise defined herein shall have the
meanings set forth in that certain Subscription Agreement (the “Subscription
Agreement”), dated August 25, 2003, between the Company and the
purchasers signatory thereto.

 

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1.                     Title
to Warrant.  Prior to the Termination Date and subject to
compliance with applicable laws and Section 7 of this Warrant, this
Warrant and all rights hereunder are transferable, in whole or in part, at the
office or agency of the Company by the Holder in person or by duly authorized
attorney, upon surrender of this Warrant together with the Assignment Form annexed
hereto properly endorsed.  The
transferee shall sign an investment letter in form and substance reasonably
satisfactory to the Company.

 

2.                     Authorization
of Warrant Shares.  The Company
represents and warrants that all Warrant Shares which may be issued upon the
exercise of the subscription rights represented by this Warrant will, upon
exercise of the subscription rights represented by this Warrant and the
issuance of such shares in compliance with the provisions of the Subscription
Agreement and this Warrant, be duly authorized, and, provided that the Exercise
Price, converted into EURO based on the USD/EURO exchange rate on the date of
payment of the Exercise Price, equals at least the par value of such shares,
validly issued and fully paid-up (“volgestort”) and free from all liens and
encumbrances in respect of the issue thereof (other than any liens or
encumbrances imposed by action of the Holder).

 

3.                     Exercise
of Warrant.

 

(a) 
Except as provided in this Section 3 herein, exercise of the
subscription rights represented by this Warrant may be made at any time or
times on or after the Initial Exercise Date and on or before the Termination
Date by the surrender of this Warrant and the Notice of Exercise Form annexed
hereto duly executed, at the office of the Company (or such other office or
agency of the Company as they may designate by notice in writing to the
registered Holder at the address of such Holder appearing on the books of the
Company) and upon payment of the Exercise Price of the shares thereby
subscribed for by wire transfer or cashier’s check drawn on a United States
bank to the Company, or by means of a cashless exercise pursuant to
Section 3(c) (as to Warrant Shares only), the Holder shall be entitled to
receive a certificate for the number of Warrant Shares for which it
subscribed.  The Company shall, upon
request of the Holder, if available and if allowed under applicable securities
laws, use its commercially reasonable efforts to deliver any certificate or
certificates required to be delivered by the Company under this
Section electronically through the Depository Trust Corporation or another
established clearing corporation performing similar functions.  The Company shall, within two weeks after
date of  payment of the Exercise Price,
deposit a bank statement as referred to in Section 2:93(a)(6) of the
Netherlands Civil Code, indicating the EURO amount into which the amount of the
Exercise Price is freely convertible based on the USD/EURO exchange rate on the
date of payment of the Exercise Price, with the Commercial Registry of the
competent Chamber of Commerce and Industry. 
Certificates for shares subscribed for hereunder shall be delivered to
the Holder within five (5) Trading Days after the date on which this Warrant
shall have been exercised as aforesaid. This Warrant shall be deemed to have
been exercised and such certificate or certificates shall be deemed to have
been issued, and Holder or any other person so designated to be named therein
shall be deemed to have become a holder of record of such shares for all
purposes, as of the date the Warrant has been exercised by payment to the
Company of

 

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the Exercise
Price and all taxes required to be paid by the Holder, if any, pursuant to
Section 5 prior to the issuance of such shares, have been paid.  If the Company fails to deliver to the
Holder a certificate or certificates representing the Warrant Shares pursuant
to this Section 3(a) by the fifth Trading Day after the date of exercise,
then the Holder will be entitled by written notice to the Company at any time
on or before its receipt of such certificate or certificates to rescind such
exercise.  In addition to any other
rights available to the Holder, if the Company fails to deliver to the Holder a
certificate or certificates representing the Warrant Shares pursuant to an
exercise by the fifth Trading Day after the date of exercise (through no fault
of the Holder), and if after such fifth Trading Day the Holder is required by
its broker to purchase (in an open market transaction or otherwise) shares of
Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant
Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall (1) pay in cash to the Holder the amount by which (x)
the Holder’s total purchase price (including brokerage commissions, if any) for
the shares of Common Stock so purchased exceeds (y) the amount obtained by
multiplying (A) the number of Warrant Shares that the Company was required to
deliver to the Holder in connection with the exercise at issue times (B) the
price at which the sell order giving rise to such purchase obligation was
executed, and (2) at the option of the Holder, either reinstate the portion of
the Warrant and equivalent number of Warrant Shares for which such exercise was
not honored or deliver to the Holder the number of shares of Common Stock that
would have been issued had the Company timely complied with its exercise and
delivery obligations hereunder.  For
example, if the Holder purchases Common Stock having a total purchase price of
$11,000 to cover a Buy-In with respect to an attempted exercise of shares of
Common Stock with an aggregate sale price giving rise to such purchase
obligation of $10,000, under clause (1) of the immediately preceding sentence
the Company shall be required to pay the Holder $1,000. The Holder shall
provide the Company written notice indicating the amounts payable to the Holder
in respect of the Buy-In, together with applicable confirmations and other
evidence reasonably requested by the Company. 
Nothing herein shall limit a Holder’s right to pursue any other remedies
available to it hereunder, at law or in equity including, without limitation, a
decree of specific performance and/or injunctive relief with respect to the
Company’s failure to timely deliver certificates representing shares of Common
Stock upon exercise of the Warrant as required pursuant to the terms hereof.

 

(b)                                 (i)
The Company shall not effect any
exercise of this Warrant, and
the Holder shall not have the right to exercise any portion of this
Warrant, pursuant to Section 3(a)
or otherwise, to the extent that after giving effect to such issuance after
exercise, the Holder (together with the Holder’s affiliates), as set forth on the applicable
Notice of Exercise, would beneficially own in excess of 4.99% of the number of
shares of the Common Stock
outstanding immediately after giving effect to such issuance.  For
purposes of the foregoing sentence, the number of shares of Common Stock
beneficially owned by the Holder and its affiliates shall include the number of shares of Common Stock issuable
upon exercise of this Warrant with
respect to which the determination of such sentence is being made, but shall
exclude the number of shares of Common Stock which would be issuable upon (A)
exercise of the remaining, nonexercised portion of

 

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this Warrant beneficially
owned by the Holder or any of its affiliates
and (B) exercise or conversion of the unexercised or nonconverted portion of
any other securities of the Company (including, without limitation, any other Debentures
or Warrants) subject to a limitation on conversion or exercise analogous to
the limitation contained herein beneficially owned by the Holder or any
of its affiliates.  Except as set
forth in the preceding sentence, for purposes of this
Section 3(b)(i), beneficial
ownership shall be calculated in accordance with Section 13(d) of the Exchange
Act.  To the extent that the limitation
contained in this Section 3(b)(ii) applies, the determination of whether
this Warrant is exercisable (in relation to other securities owned by the
Holder) and of which a portion of this Warrant is exercisable shall be in the
sole discretion of such Holder, and the submission of a Notice of Exercise
shall be deemed to be such Holder’s determination of whether this Warrant is
exercisable (in relation to other securities owned by such Holder) and of which
portion of this Warrant is exercisable, in each case subject to such aggregate
percentage limitation, and the Company shall have no obligation to verify or
confirm the accuracy of such determination. 
For purposes of this
Section 3(b)(ii), in determining
the number of outstanding shares of Common Stock, the Holder may rely on the
number of outstanding shares of Common Stock as reflected in (x) the Company’s
most recent Form 10-Q or Form 10-K, as the case may be, (y) a more recent
public announcement by the Company or (z) any other notice by the Company or
the Company’s Transfer Agent
setting forth the number of shares of Common Stock outstanding.  Upon the
written or oral request of the Holder, the Company shall within two
Trading Days confirm orally and in
writing to the Holder the number of shares of Common Stock then
outstanding.  In any case, the number of outstanding shares of Common
Stock shall be determined after giving effect to the conversion or exercise of
securities of the Company, including this Warrant, by the Holder or its
affiliates since the date as of which
such number of outstanding shares of Common Stock was reported.  The provisions of this Section 3(b)(ii)
may be waived by the Holder upon, at the election of the Holder, not less than
61 days’ prior notice to the Company, and the provisions of this
Section 3(b)(ii) shall continue to apply until such 61st day
(or such later date, as determined by the Holder, as may be specified in such
notice of waiver).

 

(ii) If the Company has not obtained
Shareholder Approval (as defined below) if required, then the Company may not
issue upon exercise of this Warrant in the aggregate, in excess of 19.999% of
the number of shares of Common Stock outstanding on the Trading Day immediately
preceding the Closing Date, less
any shares of Common Stock issued upon conversion of or as payment of interest
on the Debentures, upon prior exercise
of this or any other Warrant issued pursuant to the Subscription Agreement or
upon prior exercise of the Enable Warrants (such number of shares, the “Issuable Maximum”).  If on any attempted exercise of this
Warrant, the issuance of Warrant Shares would exceed the Issuable Maximum, and
the Company shall not have previously obtained the vote of shareholders (the “Shareholder Approval”), if any, as
may be required by the applicable rules and regulations of the Principal Market
(or any successor entity) to approve the issuance of shares of Common
Stock  in excess of the

 

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Issuable Maximum pursuant to the terms hereof, then the Company shall
issue to the Holder requesting a Warrant exercise such number of Warrant Shares
as may be issued below the Issuable Maximum and, with respect to the remainder
of the aggregate number of Warrant Shares, this Warrant shall not be
exercisable until and unless Shareholder Approval has been obtained.

 

(c)                                  If at any time after
one year from the date of issuance of this Warrant there is no effective
Registration Statement registering the resale of the Warrant Shares by the
Holder and the Holder is not eligible to sell all of its Warrant Shares at one
time pursuant to Rule 144, then the Holder may send the Company a written
notice, which shall consist of this Warrant and the Notice of Exercise Form
attached hereto (the “Termination Notice”) demanding to be paid by the Company
an amount (the “Termination Amount”) equal to [(A-B) (X)], where:

 

(A) = the VWAP on the Trading Day preceding
the date the Termination Notice is received;

 

(B) = 
the Exercise Price of the Warrants, as adjusted; and

 

(X) = the number of Warrant Shares which
would have been issuable if on the date of the Termination Notice this Warrant
would had been exercised in full in accordance with Section 3(a).

 

Upon receipt of a Termination Notice, the Company shall, at its option,
either:

 

i.                                          pay the
Termination Amount within five (5) Trading Days after the date of receipt of
the Termination Notice; or

 

ii.                                       exercise this
Warrant by means of a “cashless exercise” in which the Holder shall be entitled
to receive a certificate for the number of Warrant Shares equal to the quotient
obtained by dividing [(A-B) (X)] by (A), provided  however, that
the Company may not exercise this Warrant by means of a “cashless exercise” if
the Termination Amount (based on the USD/EURO exchange rate on the date of the
Termination Notice) is lower than the par value of the Common Stock, times
[(A-B)(X)]/A (as such terms are defined above).

 

(A)  If the Company elects to issue
the Warrant Shares in a “cashless exercise” as described above, the Company
shall, within five (5) Trading days after receipt of the Termination Notice,
deliver to the Holder a certificate for the number of Warrant Shares so issued.
The Company and the Holder agree that the Warrant Shares shall be deemed to be
paid up as of the Termination Date by way of set- off of the Holder’s
obligation to pay up the Warrant Shares against the Company’s obligation to pay
the Termination Amount. The Amount, if any, by which the Termination Amount
exceeds (i) the par value of the Warrant Shares, times (ii) the number of
issued Warrant Shares, shall be considered as share premium (“agio”)
paid on the Warrant Shares. The Company shall, within two

 

5

 

weeks after date of the Termination Notice, deposit a bank statement as
referred to in Section 2:93(a)(6) of the Netherlands Civil Code,
indicating the EURO amount into which the Termination Amount is freely
convertible based on the USD/EURO exchange rate on the date of the Termination Notice,
with the Commercial Registry of the competent Chamber of Commerce and Industry.

 

Upon (i) payment by the Company of the to the
Holder of the Termination Amount or (ii) delivery of the certificate to the
Holder for the number of Warrant Shares issuable upon a “cashless exercise” of
this Warrant, this Warrant shall terminate.

 

(d) 
If this Warrant shall have been exercised in part, the Company shall, at
the time of delivery of the certificate or certificates representing Warrant
Shares, deliver to Holder a new Warrant evidencing the rights of Holder to
purchase the unpurchased Warrant Shares called for by this Warrant, which new
Warrant shall in all other respects be identical with this Warrant.

 

4.                     No
Fractional Shares or Scrip.  No
fractional shares or scrip representing fractional shares shall be issued upon
the exercise of this Warrant.  As to any
fraction of a share which Holder would otherwise be entitled to purchase upon
such exercise, the Company shall pay a cash adjustment in respect of such final
fraction in an amount equal to such fraction multiplied by the Exercise Price.

 

5.                     Charges,
Taxes and Expenses.  Issuance of
certificates for Warrant Shares shall be made without charge to the Holder for
any issue or transfer tax or other incidental expense in respect of the
issuance of such certificate, all of which taxes and expenses shall be paid by
the Company, and such certificates shall be issued in the name of the Holder or
in such name or names as may be directed by the Holder; provided, however,
that in the event certificates for Warrant Shares are to be issued in a name
other than the name of the Holder, this Warrant when surrendered for exercise
shall be accompanied by the Assignment Form attached hereto duly executed by
the Holder; and the Company may require, as a condition thereto, the payment of
a sum sufficient to reimburse it for any transfer tax incidental thereto.

 

6.                     Closing
of Books.  The Company will not
close its shareholder books or records in any manner which prevents the timely
exercise of this Warrant, pursuant to the terms hereof.

 

7.                     Transfer,
Division and Combination.

 

(a)  Subject to compliance with any
applicable securities laws and the conditions set forth in Sections 1 and 7(e)
hereof and to the provisions of Section 4.1 of the Subscription Agreement,
this Warrant and all rights hereunder are transferable, in whole or in part,
upon surrender of this Warrant at the principal office of the Company, together
with a written assignment of this Warrant substantially in the form attached
hereto duly executed by the Holder or its agent or attorney and funds
sufficient to pay any transfer taxes payable upon the making of such
transfer.  Upon such surrender and, if
required, such payment, the Company shall execute and deliver a new Warrant or

 

6

 

Warrants in the
name of the assignee or assignees and in the denomination or denominations
specified in such instrument of assignment, and shall issue to the assignor a
new Warrant evidencing the portion of this Warrant not so assigned, and this
Warrant shall promptly be cancelled.  A
Warrant, if properly assigned, may be exercised by a new holder for the
purchase of Warrant Shares without having a new Warrant issued.

 

(b)  This Warrant may be divided or combined
with other Warrants upon presentation hereof at the aforesaid office of the
Company, together with a written notice specifying the names and denominations
in which new Warrants are to be issued, signed by the Holder or its agent or
attorney.  Subject to compliance with
Section 7(a), as to any transfer which may be involved in such division or
combination, the Company shall execute and deliver a new Warrant or Warrants in
exchange for the Warrant or Warrants to be divided or combined in accordance
with such notice.

 

(c)  The Company shall prepare, issue and
deliver at its own expense (other than transfer taxes) the new Warrant or
Warrants under this Section 7.

 

(d)  The Company agrees to maintain, at its
aforesaid office, books for the registration and the registration of transfer
of the Warrants.

 

(e)  If, at the time of the
surrender of this Warrant in connection with any transfer of this Warrant, the
transfer of this Warrant shall not be registered pursuant to an effective
registration statement under the Securities Act and under applicable state
securities or blue sky laws, the Company may require, as a condition of
allowing such transfer (i) that the Holder or transferee of this Warrant, as
the case may be, furnish to the Company a written opinion of counsel (which
opinion shall be in form, substance and scope customary for opinions of counsel
in comparable transactions) to the effect that such transfer may be made
without registration under the Securities Act and under applicable state
securities or blue sky laws, (ii) that the holder or transferee execute and
deliver to the Company an investment letter in form and substance acceptable to
the Company and (iii) that the transferee be an “accredited investor” as
defined in Rule 501(a) promulgated under the Securities Act.

 

8.                     No
Rights as Shareholder until Exercise. 
This Warrant does not entitle the Holder to any voting rights or other
rights as a shareholder of the Company prior to the exercise hereof.  Upon the exercise of this Warrant in accordance
with Section 3, the Warrant Shares so purchased shall be and be deemed to
be issued to such Holder as the record owner of such shares as of the close of
business on the date of such exercise.

 

9.                     Loss,
Theft, Destruction or Mutilation of Warrant.  The Company covenants that upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant or any stock certificate relating to the Warrant
Shares, and in case of loss, theft or destruction, of indemnity or security
reasonably satisfactory to it (which, in the case of the Warrant, shall not
include the posting of any bond), and upon surrender and cancellation of such
Warrant or stock certificate, if mutilated, the Company will make and deliver a
new Warrant or stock certificate of like tenor and dated as of such
cancellation, in lieu of such Warrant or stock certificate.

 

7

 

10.               Saturdays,
Sundays, Holidays, etc.  If the last
or appointed day for the taking of any action or the expiration of any right
required or granted herein shall be a Saturday, Sunday or a legal holiday, then
such action may be taken or such right may be exercised on the next succeeding
day not a Saturday, Sunday or legal holiday.

 

11.               Adjustments
of Exercise Price and Number of Warrant Shares.

 

(a)  Stock Splits, etc.  The number and kind of securities which can
be subscribed for upon the exercise of this Warrant and the Exercise Price
shall be subject to adjustment from time to time upon the happening of any of
the following; provided, however, that the Company shall not take
any action that would lower the Exercise Price (converted into EURO based on
the USD/EURO exchange rate on the date of such Dilutive Issuance) below the par
value of the Common Stock.  In case the
Company shall (i) pay a dividend in shares of Common Stock or make a
distribution in shares of Common Stock to holders of its outstanding Common
Stock, (ii) subdivide its outstanding shares of Common Stock into a greater
number of shares, (iii) combine its outstanding shares of Common Stock into a
smaller number of shares of Common Stock, or (iv) issue any shares of its
capital stock in a reclassification of the Common Stock, then the number of
Warrant Shares which can be subscribed for upon exercise of this Warrant
immediately prior thereto shall be adjusted so that the Holder shall be
entitled to receive the kind and number of Warrant Shares or other securities
of the Company which it would have owned or have been entitled to receive had
such Warrant been exercised in advance thereof.  Upon each such adjustment of the kind and number of Warrant
Shares or other securities of the Company which are which can be subscribed for
hereunder, the Holder shall thereafter be entitled to subscribe for the number
of Warrant Shares or other securities as so adjusted at an exercise price per
Warrant Share or other security obtained by multiplying the Exercise Price in
effect immediately prior to such adjustment by the number of Warrant Shares
which can be subscribed for pursuant hereto immediately prior to such
adjustment and dividing by the number of Warrant Shares or other securities of
the Company as so adjusted.  An
adjustment made pursuant to this paragraph shall become effective immediately
after the effective date of such event retroactive to the record date, if any,
for such event.

 

(b)  Anti-Dilution Provisions.   During the period beginning on the Initial
Exercise Date and ending on the Termination Date (the “Exercise Period”), the
Exercise Price shall be subject to adjustment from time to time as provided in
this Section 11(b); provided, however, that the Company
shall not take any action that would lower the Exercise Price (converted into
EURO based on the USD/EURO exchange rate on the date of such Dilutive Issuance)
below the par value of the Common Stock. 
In the event that any adjustment of the Exercise Price as required
herein results in a fraction of a cent, such Exercise Price shall be rounded up
or down to the nearest cent.

 

(i)                                     Adjustment
of Exercise Price.  Except as set
forth in Section 11(b)(ii)(E), if and whenever the Company issues or
sells, or in accordance with Section 11(b) hereof is deemed to have issued
or sold, any shares of Common Stock for an effective consideration per share of
less than the then Exercise Price or for no consideration (such lower price,
the “Base Share Price” and such

 

8

 

issuances collectively, a “Dilutive Issuance”),
then, the Exercise Price shall be reduced to a price determined by dividing (i)
an amount equal to the sum of (a) the total number of shares of Common Stock
outstanding immediately prior to such issuance or sale (excluding treasury
shares, if any) multiplied by the Exercise Price then in effect, plus (b) the
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 Dilutive Issuance (excluding treasury shares), provided, that for
purposes hereof, all shares of Common Stock that are issuable upon conversion,
exercise or exchange of Capital Shares Equivalents (including, without
limitation, the Debentures) shall be deemed outstanding immediately after the
issuance of such Capital Shares Equivalents. 
Such adjustment shall be made whenever such shares of Common Stock or
Capital Share Equivalents are issued. 
For purposes of this Section 11(b), the number of shares of Common
Stock outstanding as of a given date shall be the number of shares of Common
Stock (excluding treasury shares, if any) outstanding plus all Underlying
Shares issuable on conversion of the Debentures.

 

(ii)                                  Effect on Exercise
Price of Certain Events.  For
purposes of determining the adjusted Exercise Price under Section 11(b)
hereof, the following will be applicable:

 

 (A)                           Issuance
of Rights or Options.  If the
Company in any manner issues or grants any warrants, rights or options, whether
or not immediately exercisable, to subscribe for or to purchase Common Stock or
other securities exercisable, convertible into or exchangeable for Common Stock
(“Convertible Securities”) (such warrants, rights and options to
purchase Common Stock or Convertible Securities are hereinafter referred to as
“Options”) and the effective price per share for which Common Stock is
issuable upon the exercise of such Options is less than the Exercise Price (“Below
Base Price Options”), then the maximum total number of shares of Common
Stock issuable upon the exercise of all such Below Base Price Options (assuming
full exercise, conversion or exchange of Convertible Securities, if applicable)
will, as of the date of the issuance or grant of such Below Base Price Options,
be deemed to be outstanding and to have been issued and sold by the Company for
such price per share and the maximum consideration payable to the Company upon
such exercise (assuming full exercise, conversion or exchange of Convertible
Securities, if applicable) will be deemed to have been received by the Company.  For purposes of the preceding sentence, the
“effective price per share for which Common Stock is issuable upon the exercise
of such Below Base Price Options” is determined by dividing (i) the total
amount, if any, received or receivable by the Company as consideration for the
issuance or granting of all such Below Base Price Options, plus the minimum
aggregate amount of additional consideration, if any, payable to the Company
upon the exercise of all such Below Base Price Options, plus, in the case of
Convertible Securities issuable upon the

 

9

 

exercise of such Below Base Price Options, the minimum aggregate amount
of additional consideration payable upon the exercise, conversion or exchange
thereof at the time such Convertible Securities first become exercisable,
convertible or exchangeable, by (ii) the maximum total number of shares of
Common Stock issuable upon the exercise of all such Below Base Price Options
(assuming full conversion of Convertible Securities, if applicable).  No further adjustment to the Exercise Price
will be made upon the actual issuance of such Common Stock or Convertible
Securities upon the exercise of such Below Base Price Options or upon the
exercise, conversion or exchange of Convertible Securities issuable upon
exercise of such Below Base Price Options.

 

(B)                                Issuance of
Convertible Securities. If the Company in any manner issues or sells any
Convertible Securities, whether or not immediately convertible (other than
where the same are treated as Options or as issuable upon the exercise of
Options under Section 11(b)(ii)(A)) and the effective price per share for
which Common Stock is issuable upon such exercise, conversion or exchange is
less than the Exercise Price, then the maximum total number of shares of Common
Stock issuable upon the exercise, conversion or exchange of all such
Convertible Securities will, as of the date of the issuance of such Convertible
Securities, be deemed to be outstanding and to have been issued and sold by the
Company for such price per share and the maximum consideration payable to the
Company upon such exercise (assuming full exercise, conversion or exchange of
Convertible Securities, if applicable) will be deemed to have been received by
the Company.  For the purposes of the
preceding sentence, the “effective price per share for which Common Stock is
issuable upon such exercise, conversion or exchange” is determined by dividing
(i) 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 exercise, conversion or exchange thereof at the time such
Convertible Securities first become exercisable, convertible or exchangeable,
by (ii) the maximum total number of shares of Common Stock issuable upon the
exercise, conversion or exchange of all such Convertible Securities.  No further adjustment to the Exercise Price
will be made upon the actual issuance of such Common Stock upon exercise,
conversion or exchange of such Convertible Securities.

 

(C)                                Change in Option
Price or Conversion Rate.  If there
is a change at any time in (i) the amount of additional consideration payable
to the Company upon the exercise of any Options; (ii) the amount of additional
consideration, if any, payable to the Company upon the exercise, conversion or
exchange of any Convertible Securities; or (iii) the rate at which any
Convertible Securities are convertible into or exchangeable for Common Stock
(in each such case, other than under or

 

10

 

by reason of provisions designed to protect against dilution), the
Exercise Price in effect at the time of such change will be readjusted to the
Exercise Price which would have been in effect at such time had such Options or
Convertible Securities still outstanding provided for such changed additional
consideration or changed conversion rate, as the case may be, at the time initially
granted, issued or sold.

 

(D)                               Calculation of
Consideration Received.  If any
Common Stock, Options or Convertible Securities are issued, granted or sold for
cash, the consideration received therefor for purposes of this Warrant will be
the amount received by the Company therefor, before deduction of reasonable
commissions, underwriting discounts or allowances or other reasonable expenses
paid or incurred by the Company in connection with such issuance, grant or
sale.  In case any Common Stock, Options
or Convertible Securities are issued or sold for a consideration part or all of
which shall be other than cash, the amount of the consideration other than cash
received by the Company will be the fair market value of such consideration,
except where such consideration consists of securities, in which case the
amount of consideration received by the Company will be the fair market value
(closing bid price, if traded on any market) thereof as of the date of
receipt.  In case any Common Stock,
Options 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, Options or Convertible Securities, as the
case may be.  The fair market value of
any consideration other than cash or securities will be determined in good
faith by an investment banker or other appropriate expert of national
reputation selected by the Company and reasonably acceptable to the holder
hereof, with the costs of such appraisal to be borne by the Company.

 

(E)                                 Exceptions to
Adjustment of Exercise Price. 
Notwithstanding the foregoing, no adjustment will be made under this
Section 11(b) in respect of (1) the granting of options or the issuance of
shares of Common  Stock to employees,
officers and directors of the Company pursuant to any stock option plan, share
purchase plan or similar plan duly adopted by a majority of the non-employee
members of the Supervisory Board of the Company or a majority of the members of
a committee of non-employee directors established for such purpose, (2) the
issuance of up to 150,000 shares of Common Stock or Capital Shares Equivalents,
in the aggregate, to consultants or advisors to the Company for services
rendered to the Company by such consultants or advisors subsequent to the date
hereof, (3) the issuance or deemed issuance of any security by the Company
pursuant to the Transaction Documents, or (4) upon the exercise of or
conversion of any convertible securities, options or

 

11

 

warrants issued and outstanding on the Initial Exercise Date, provided
that such securities have not been amended since the date of the Subscription
Agreement to increase the type or number of securities issuable with respect
thereto or decrease the exercise or conversion price of such securities, (5)
acquisitions, business partnerships, joint ventures, real property leasing
arrangements, or other strategic investments, the primary purpose of which is
not to raise capital, or commercial credit arrangements or debt financings from
a bank or similar financial institution, (6) leasing arrangements from a bank
or similar financial institution approved by the Company’s Supervisory Board or
(7) any Capital Shares Equivalents issued pursuant to a rights plan adopted by
the Company’s Supervisory Board commonly referred to as a “poison pill” plan,
but this exception shall not apply to any subsequent exercise of any such
Capital Shares Equivalents; and no single event that causes and adjustment
under this Section 11(b) shall cause an adjustment under more than one of
the paragraphs above.

 

(F)                                 Expiration of
Rights.  If any such Options or the
conversion privilege represented by any such Convertible Securities shall
expire without having been exercised, the Exercise Price as adjusted upon the
issuance of such Options or Convertible Securities shall be readjusted to the
Exercise Price which would have been in effect had an adjustment been made on
the basis that the only additional Common Stock so issued or deemed issued were
the Common Stock, if any, actually issued or sold on the exercise of such
Options or rights of conversion of such Convertible Securities, and such
additional Common Shares, if any, were issued or sold for the consideration
actually received by the Company upon such exercise, plus the consideration, if
any, actually received by the Company for the granting of all such Options,
whether or not exercised, plus the consideration received for issuing or
selling the Convertible Securities actually converted, plus the consideration,
if any, actually received by the Company on the conversion of such Convertible
Securities, provided
that such readjustment shall not apply to prior exercises of this Warrant.

 

(iii)                               Minimum Adjustment of
Exercise Price.  No adjustment of
the Exercise Price shall be made in an amount of less than 1% of the Exercise
Price or in effect at the time such adjustment is otherwise required to be
made, but any such lesser adjustment shall be carried forward and shall be made
at the time and together with the next subsequent adjustment which, together
with any adjustments so carried forward, shall amount to not less than 1% of
the exercise price.

 

12.               Reorganization,
Reclassification, Merger, Consolidation or Disposition of Assets.  In case the Company shall reorganize its
capital, reclassify its capital stock, consolidate or merge with or into
another corporation (where the Company is not the surviving corporation

 

12

 

or where there
is a change in or distribution with respect to the Common Stock of the
Company), or sell, transfer or otherwise dispose of all or substantially all
its property, assets or business to another corporation and, pursuant to the
terms of such reorganization, reclassification, merger, consolidation or
disposition of assets, shares of common stock of the successor or acquiring
corporation, or any cash, shares of stock or other securities or property of
any nature whatsoever (including warrants or other subscription or purchase
rights) in addition to or in lieu of common stock of the successor or acquiring
corporation (“Other Property”), are to be received by or distributed to
the holders of Common Stock of the Company, then the Holder shall have the
right thereafter to receive, upon exercise of this Warrant, the number of
shares of Common Stock of the successor or acquiring corporation or of the
Company, if it is the surviving corporation, and Other Property receivable upon
or as a result of such reorganization, reclassification, merger, consolidation
or disposition of assets by a Holder of the number of shares of Common Stock
for which this Warrant is exercisable immediately prior to such event.  In case of any such reorganization,
reclassification, merger, consolidation or disposition of assets, the successor
or acquiring corporation (if other than the Company) shall expressly assume the
due and punctual observance and performance of each and every covenant and
condition of this Warrant to be performed and observed by the Company and all
the obligations and liabilities hereunder, subject to such modifications as may
be deemed appropriate (as determined in good faith by resolution of the
Managing Board of the Company) in order to provide for adjustments of Warrant
Shares for which this Warrant is exercisable which shall be as nearly
equivalent as practicable to the adjustments provided for in this
Section 12.  For purposes of this
Section 12, “common stock of the successor or acquiring corporation” shall
include stock of such corporation of any class which is not preferred as to
dividends or assets over any other class of stock of such corporation and which
is not subject to redemption and shall also include any evidences of
indebtedness, shares of stock or other securities which are convertible into or
exchangeable for any such stock, either immediately or upon the arrival of a
specified date or the happening of a specified event and any warrants or other
rights to subscribe for or purchase any such stock.  The foregoing provisions of this Section 12 shall similarly
apply to successive reorganizations, reclassifications, mergers, consolidations
or disposition of assets.

 

13.               Voluntary
Adjustment by the Company.  The
Company may at any time during the term of this Warrant reduce the then current
Exercise Price to any amount and for any period of time deemed appropriate by
the Supervisory Board of the Company.

 

14.               Notice
of Adjustment.  Whenever the number
of Warrant Shares or number or kind of securities or other property purchasable
upon the exercise of this Warrant or the Exercise Price is adjusted, as herein
provided, the Company shall give notice thereof to the Holder at the address of
such Holder appearing on the books of the Company, which notice shall state the
number of Warrant Shares (and other securities or property) purchasable upon
the exercise of this Warrant and the Exercise Price of such Warrant Shares (and
other securities or property) after such adjustment, setting forth a brief
statement of the facts requiring such adjustment and setting forth the
computation by which such adjustment was made.

 

15.               Notice
of Corporate Action.  If at any
time:

 

(a)                                  the Company shall
take a record of the holders of its Common Stock for the purpose of entitling
them to receive a dividend or other distribution, or any

 

13

 

right to subscribe for or purchase any evidences of its indebtedness,
any shares of stock of any class or any other securities or property, or to
receive any other right (other than with respect to any equity or equity
equivalent security issued pursuant to a rights plan adopted by the Company’s
Supervisory Board), or

 

(b)                                 there shall be any
capital reorganization of the Company, any reclassification or recapitalization
of the capital stock of the Company or any consolidation or merger of the
Company with, or any sale, transfer or other disposition of all or
substantially all the property, assets or business of the Company to, another
corporation or,

 

(c)                                  there shall be a
voluntary or involuntary dissolution, liquidation or winding up of the Company;

 

then, in any one or more of such cases, the Company shall give to
Holder, unless by doing so the Company would act in violation of
Section 46a of the Act of the Supervision of the Securities Trade 1995 (“Wet toezicht
effectenverkeer 1995”), (i) at least 20 days’ prior written notice
of the date on which a record date shall be selected for such dividend,
distribution or right or for determining rights to vote in respect of any such
reorganization, reclassification, merger, consolidation, sale, transfer,
disposition, liquidation or winding up, and (ii) in the case of any such
reorganization, reclassification, merger, consolidation, sale, transfer,
disposition, dissolution, liquidation or winding up, at least 20 days’ prior
written notice of the date when the same shall take place.  Such notice in accordance with the foregoing
clause also shall specify (i) the date on which any such record is to be taken
for the purpose of such dividend, distribution or right, the date on which the
holders of Common Stock shall be entitled to any such dividend, distribution or
right, and the amount and character thereof, and (ii) the date on which any
such reorganization, reclassification, merger, consolidation, sale, transfer,
disposition, dissolution, liquidation or winding up is to take place and the
time, if any such time is to be fixed, as of which the holders of Common Stock
shall be entitled to exchange their Warrant Shares for securities or other
property deliverable upon such disposition, dissolution, liquidation or winding
up.  Each such written notice shall be
sufficiently given if addressed to Holder at the last address of Holder
appearing on the books of the Company and delivered in accordance with
Section 18(d).

 

16.               Authorized
Shares.  The Company covenants that
during the period the Warrant is outstanding, it will reserve from its
authorized share capital (“maatschappelijk kapitaal”) a sufficient
number of shares to provide for the issuance of the Warrant Shares upon the
exercise of any purchase rights under this Warrant.  The Company further covenants that its issuance of this Warrant
shall constitute full authority to its officers who are charged with the duty
of executing share certificates to execute and issue the necessary certificates
for the Warrant Shares upon the exercise of the purchase rights under this
Warrant.  The Company will take all such
reasonable action as may be necessary to assure that such Warrant Shares may be
issued as provided herein without violation of any applicable law or regulation,
or of any requirements of the Principal Market upon which the Common Stock may
be listed.

 

Except and to the extent as waived or consented to by the Holder, the
Company shall not by any action, including, without limitation, amending its
Articles of

 

14

 

Association or through any
reorganization, transfer of assets, consolidation, merger, dissolution, issue
or sale of securities or any other voluntary action, avoid or seek to avoid the
observance or performance of any of the terms of this Warrant, but will at all
times in good faith assist in the carrying out of all such terms and in the
taking of all such actions as may be necessary or appropriate to protect the
rights of Holder as set forth in this Warrant against impairment.  Without limiting the generality of the
foregoing, the Company will (a) not increase the par value of any Warrant
Shares above the amount payable therefor upon such exercise immediately prior to
such increase in par value, (b) take all such action as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and nonassessable Warrant Shares upon the exercise of this Warrant, and (c) use
commercially reasonable efforts to obtain all such authorizations, exemptions
or consents from any public regulatory body having jurisdiction thereof as may
be necessary to enable the Company to perform its obligations under this
Warrant.

 

Before taking any action which would result in an adjustment in the
number of Warrant Shares for which this Warrant is exercisable or in the
Exercise Price, the Company shall use its commercially reasonable efforts to
obtain all such authorizations or exemptions thereof, or consents thereto, as
may be necessary from any public regulatory body or bodies having jurisdiction
thereof.

 

17.               Mandatory
Termination.  The Company shall have
the right, upon 30 days’ prior written notice to the Holder (the “Mandatory
Termination Notice”), to terminate this Warrant, provided that (i) the Warrant
Shares are registered for resale pursuant to the Securities Act or are freely
tradable without restriction or legend and have been continuously for at least
the 20-Trading Day period immediately preceding the date of the Mandatory
Termination Notice, (ii) the Common Stock shall be listed or quoted for trading
on the Principal Market continuously during the 20-Trading Day period
immediately preceding the date of the Mandatory Termination Notice and (ii) the
VWAPs for each of the 20 Trading Days immediately preceding the date of the
Mandatory Termination Notice were equal to or greater than $10.34 (subject to adjustment
for reverse and forward stock splits, stock dividends, stock combinations and
other similar transactions of the Common Stock that occur after the date of
this Agreement).  If this Warrant has
not been exercised in full upon the expiration of such 30 day notice period,
this Warrant shall terminate automatically without any further action on the
part of the Holder or the Company.

 

18.               Miscellaneous.

 

(a)  Jurisdiction.  This Warrant shall constitute a contract
under the laws of California, without regard to its conflict of law, principles
or rules.

 

(b)  Restrictions.  The Holder acknowledges that the Warrant
Shares acquired upon the exercise of this Warrant, if not registered, will have
restrictions upon resale imposed by state and federal securities laws.

 

(c)  Nonwaiver and Expenses.  No course of dealing or any delay or failure
to exercise any right hereunder on the part of Holder shall operate as a waiver
of such right or otherwise prejudice Holder’s rights, powers or remedies,
notwithstanding all rights hereunder terminate on the Termination Date.  If the Company willfully and

 

15

 

knowingly fails to
comply with any provision of this Warrant, which results in any material
damages to the Holder, the Company shall pay to Holder such amounts as shall be
sufficient to cover any costs and expenses including, but not limited to,
reasonable attorneys’ fees, including those of appellate proceedings, incurred
by Holder in collecting any amounts due pursuant hereto or in otherwise
enforcing any of its rights, powers or remedies hereunder.

 

(d)  Notices.  Any notice, request or other document
required or permitted to be given or delivered to the Holder by the Company
shall be delivered in accordance with the notice provisions of the Subscription
Agreement.

 

(e)  Limitation of Liability.  No provision hereof, in the absence of any
affirmative action by Holder to exercise this Warrant or purchase Warrant
Shares, and no enumeration herein of the rights or privileges of Holder, shall
give rise to any liability of Holder for the subscription for any Common Stock
or as a shareholder of the Company, whether such liability is asserted by the
Company or by creditors of the Company.

 

(f)  Remedies.  Holder, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Warrant.  The Company agrees that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
by it of the provisions of this Warrant and hereby agrees to waive the defense
in any action for specific performance that a remedy at law would be adequate.

 

(g)  Acceptance.  Receipt of this Warrant by the Holder shall
constitute acceptance of and agreement to all of the terms and conditions
contained herein.

 

(h)  Successors and Assigns.  Subject to applicable securities laws, this
Warrant and the rights and obligations evidenced hereby shall inure to the
benefit of and be binding upon the successors of the Company and the successors
and permitted assigns of Holder.  The
provisions of this Warrant are intended to be for the benefit of all Holders
from time to time of this Warrant and shall be enforceable by any such Holder
or holder of Warrant Shares

 

(i)  Amendment.  This Warrant may be modified or amended or
the provisions hereof waived with the written consent of the Company and the
Holder.

 

(j)  Severability.  Wherever possible, each provision of this
Warrant shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Warrant shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provisions or the remaining provisions of this Warrant.

 

(k)  Headings.  The headings used in this Warrant are for
the convenience of reference only and shall not, for any purpose, be deemed a
part of this Warrant.

 

********************

 

16

 

IN WITNESS WHEREOF, the
Company has caused this Warrant to be executed by its officer thereunto duly
authorized.

 

 

	
  Dated:  August 25, 2003

  	
   

  	
   

  
	
   

  	
    METRON TECHNOLOGY N.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
				

 

17

 

NOTICE OF EXERCISE

 

To:                              Metron
Technology N.V.

 

(1)  The undersigned hereby elects to (check
one box only):

 

o                                    subscribe
for
              
Warrant Shares of Metron Technology N.V. pursuant to the terms of the attached
Warrant (only if exercised in full), and tenders herewith payment of the exercise
price in full, together with all applicable transfer taxes, if any; or

 

o                                    Demand
the Termination Amount pursuant to Section 3(c) of the attached Warrant.

 

(2)  The Warrant Shares, if any,
shall be delivered to the Holder at the following:

 

 

 

 

 

 

 

(3)  Accredited Investor.  The undersigned is an “accredited investor”
as defined in Regulation D promulgated under the Securities Act of 1933, as
amended.

 

(5)  The Holder’s broker and
such broker’s DTC number are as follows:

 

 

 

	
   

  	
  [PURCHASER]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  Dated:

  	
   

  	
   

  
					

 

1

 

[ASSIGNMENT FORM

 

(To assign the foregoing warrant, execute

this form and supply required information. 

Do not use this form to exercise the warrant.)

 

 

FOR VALUE RECEIVED, the
foregoing Warrant and all rights evidenced thereby are hereby assigned to

 

                                                                                                
whose address is

 

                                                                                                                                     .

 

                                                                                                                                     

 

	
   

  	
   

  	
  Dated:

  	
   

  	
  ,

  	
   

  	
   

  
	
   

  	
   

  	
   

  	 

	
   

  	
  Holder’s Signature:

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  Holder’s Address:

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

										

 

	
  Signature Guaranteed:

  	
   

  	
   

  

 

 

NOTE:  The signature to this Assignment Form must correspond with the
name as it appears on the face of the Warrant, without alteration or
enlargement or any change whatsoever, and must be guaranteed by a bank or trust
company.  Officers of corporations and
those acting in a fiduciary or other representative capacity should file proper
evidence of authority to assign the foregoing Warrant.

 

2Exhibit 10.3

 

REGISTRATION RIGHTS AGREEMENT

 

This
Registration Rights Agreement (this “Agreement”) is made and entered
into as of August 25, 2003, among Metron Technology N.V., a corporation
incorporated under the laws of The Netherlands (the “Company”), and the
purchasers signatory hereto (each such purchaser is a “Purchaser” and
all such purchasers are, collectively, the “Purchasers”).

 

This Agreement
is made pursuant to the Subscription Agreement, dated as of the date hereof
among the Company and the Purchasers (the “Subscription Agreement”).

 

The Company
and the Purchasers hereby agree as follows:

 

1. Definitions

 

Capitalized terms used and not otherwise
defined herein that are defined in the Subscription Agreement shall have the
meanings given such terms in the Subscription Agreement.
As used in this Agreement, the following terms shall have the following
meanings:

 

“Effectiveness Date” means, with
respect to the initial Registration Statement required hereunder, the 60th
calendar day (90th calendar day in the event of a “full review” by
the Commission) following the Filing Date and, with respect to any additional
Registration Statements which may be required pursuant to Section 3(c),
the 60th calendar day (90th calendar day in the event of
a “full review” by the Commission) following the date on which the Company
first knows, or reasonably should have known, that such additional Registration
Statement is required hereunder; provided, however, in the event
the Company is notified by the Commission that one of the above Registration
Statements will not be reviewed or is no longer subject to further review and
comments, the Effectiveness Date as to such Registration Statement shall be the
fifth Trading Day following the date on which the Company is so notified if
such date precedes the dates required above.

 

“Effectiveness Period”
shall have the meaning set forth in Section 2(a).

 

“Filing Date” means, with respect to
the initial Registration Statement filed hereunder, the later of (i)
September 5, 2003 or (ii) the 30th day following the Closing
Date and, with respect to any additional Registration Statements which may be
required pursuant to Section 3(c), the 30th day following the
date on which the Company first knows, or reasonably should have known that
such additional Registration Statement is required hereunder.

 

“Holder” or “Holders” means the
holder or holders, as the case may be, from time to time of Registrable
Securities.

 

“Indemnified Party” shall have the
meaning set forth in Section 5(c) hereof.

 

1

 

“Indemnifying Party” shall have the
meaning set forth in Section 5(c) hereof.

 

“Losses”
shall have the meaning set forth in Section 5(a).

 

“Proceeding” means an action, claim,
suit, investigation or proceeding (including, without limitation, an
investigation or partial proceeding, such as a deposition), whether commenced
or threatened in writing.

 

“Prospectus” means the prospectus
included in a Registration Statement (including, without limitation, a prospectus
that includes any information previously omitted from a prospectus filed as
part of an effective registration statement in reliance upon Rule 430A
promulgated under the Securities Act), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion
of the Registrable Securities covered by a Registration Statement, and all
other amendments and supplements to the Prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.

 

“Registrable Securities” means (i) all
of the shares of Common Stock issuable upon conversion in full of the
Debentures assuming the lowest possible conversion price in effect during the
period between the applicable Closing and the filing date of the Registration
Statement, (ii) all shares of Common Stock issuable in lieu of cash interest
payments assuming all interest is paid in shares of Common Stock valued based
on the VWAPs for the 10 Trading Days prior to the date of determination and all
Debentures are held until the 42nd month anniversary of their date of issuance,
(iii) all shares of Common Stock issuable upon exercise in full of the
Warrants, and (iv) any securities issued or issuable upon any stock split,
dividend or other distribution recapitalization or similar event with respect
to the foregoing or in connection with any anti-dilution provisions in the
Debentures.

 

“Registration Statement” means the
registration statements required to be filed hereunder and any additional
registration statements contemplated by Section 3(c), including (in each
case) the Prospectus, amendments and supplements to such registration statement
or Prospectus, including pre- and post-effective amendments, all exhibits
thereto, and all material incorporated by reference or deemed to be
incorporated by reference in such registration statement.

 

“Rule 415” means Rule 415 promulgated
by the Commission pursuant to the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by the
Commission having substantially the same purpose and effect as such Rule.

 

“Rule 424” means Rule 424 promulgated
by the Commission pursuant to the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by the
Commission having substantially the same purpose and effect as such Rule.

 

2

 

“Warrants” shall mean the Common Stock
purchase warrants issued to the Purchasers pursuant to the Subscription
Agreement.

 

2. Shelf Registration

 

(a)  On or prior to each Filing Date, the Company
shall prepare and file with the Commission a “Shelf” Registration Statement
covering the resale of 150% of the Registrable Securities on such Filing Date
for an offering to be made on a continuous basis pursuant to Rule 415.  The Registration Statement shall be on Form
S-3 (unless the Company is not then eligible to register for resale the
Registrable Securities on Form S-3, in which case such registration shall be on
another appropriate form in accordance herewith) and shall contain (unless
otherwise directed by the Holders and except to the extent the Company
determines that modifications thereto are required under applicable law)
substantially the “Plan of Distribution” attached hereto as Annex A.  Subject to the terms of this Agreement, the
Company shall use commercially reasonable efforts to cause the Registration
Statement to be declared effective under the Securities Act as promptly as
possible after the filing thereof, but in any event prior to the applicable
Effectiveness Date, and shall use its commercially reasonable efforts to keep
such Registration Statement continuously effective under the Securities Act
until the date when all Registrable Securities covered by such Registration
Statement have been sold or may be sold without volume restrictions pursuant to
Rule 144(k) as determined by the counsel to the Company pursuant to a written
opinion letter to such effect, addressed and acceptable to the Company’s
transfer agent with a copy to the affected Holders (the “Effectiveness
Period”).  The Company shall
promptly notify the Holders via facsimile of the effectiveness of any
Registration Statement on the day that the Company receives notification of the
effectiveness of such Registration Statement from the Commission.  The Holders covenant and agree that
any and all sales of Registrable Securities will be made in accordance with the
“Plan of Distribution” attached hereto as Annex A (or such other “Plan of
Distribution” as the Holders might direct and to which the Company agrees).

 

(b)  If: (i) a Registration Statement is not
filed on or prior to its Filing Date (if the Company files a Registration Statement
without affording the Holders the opportunity to review and comment on the same
as required by Section 3(a), the Company shall not be deemed to have been
filed on or prior to the Filing Date), or (ii) the Company fails to file with
the Commission a request for acceleration in accordance with Rule 461
promulgated under the Securities Act, within five Trading Days of the date that
the Company is notified (orally or in writing, whichever is earlier) by the
Commission that a Registration Statement will not be “reviewed,” or not subject
to further review, or (iii) prior to its Effectiveness Date, the Company fails
to file a pre-effective amendment and otherwise respond in writing to comments
made by the Commission in respect of such Registration Statement within 15
Trading Days after the receipt of comments by or notice from the Commission
that such amendment is required in order for a Registration Statement to be
declared effective, or (iv) a Registration Statement filed or required to be
filed hereunder is not declared effective by the Commission by its
Effectiveness Date, or (v) after the Effectiveness Date, a Registration
Statement ceases for any reason to remain continuously effective as to all
Registrable Securities for which it is required to be effective, or the Holders
are not permitted to utilize the Prospectus therein to resell such

 

3

 

Registrable Securities for 15 consecutive Trading Days or an aggregate
of 25 Trading Days during any 12-month period (which need not be consecutive
Trading Days) (any such failure or breach being referred to as an “Event”, and for purposes of
clause (i) or (iv) the date on which such Event occurs, or for purposes of
clause (ii) the date on which such five Trading Day period is exceeded, or for
purposes of clause (iii) the date which such 15 Trading Day period is exceeded,
or for purposes of clause (v) the date on which such 15 or 25 Trading Day
period, as applicable, is exceeded being referred to as “Event Date”), then, on each such Event Date and every
monthly anniversary thereof until the applicable Event is cured, the Company
shall pay to each Holder an amount in cash, as liquidated damages and not as a
penalty, equal to 2.0% per month of the Subscription Amount paid by such Holder
pursuant to the Subscription Agreement for Securities then held by such Holder.  If the Company fails to pay any
liquidated damages pursuant to this Section in full within seven days
after the date payable, the Company will pay interest thereon at a rate of 18%
per annum (or such lesser maximum amount that is permitted to be paid by
applicable law) to the Holder, accruing daily from the date such liquidated
damages are due until such amounts, plus all such interest thereon, are paid in
full. The liquidated damages pursuant to the terms hereof shall apply on a
pro-rata basis for any portion of a month prior to the cure of an Event.

 

3. Registration Procedures

 

In connection
with the Company’s registration obligations hereunder, the Company shall:

 

(a) Not less
than five Trading Days prior (only three Trading Days if the Registration
Statement is an amendment) to the filing of each Registration Statement or any
related Prospectus or any amendment or supplement thereto (including any
document that would be incorporated or deemed to be incorporated therein by
reference), the Company shall, (i) furnish to each Holder copies of all such
documents proposed to be filed with the Commission, which documents (other than
those incorporated or deemed to be incorporated by reference) will be subject
to the review of such Holders, and (ii) cause its officers and directors,
counsel and independent certified public accountants to respond to such
inquiries as shall be necessary, in the reasonable opinion of respective
counsel to conduct a reasonable investigation within the meaning of the
Securities Act. The Company shall not file the Registration Statement or any
such Prospectus or any amendments or supplements thereto to which the Holders
of a majority of Registrable Securities shall reasonably and in good faith
object, provided, the Company is notified of such objection in writing no later
than five Trading Days (only three Trading Days if the Registration Statement
is an amendment) after the Holders have been so furnished copies of such
documents (it being understood that during any such period of good faith
objection by such Holders, any timing deadlines on the Company shall be
tolled).  Any prospectus supplements
required to be filed less than five Trading Days after the occurrence of any
event, shall not be subject to prior approval by the Holders, but the Company
shall provide pre-filing copies to the Holders.

 

(b) (i)
Prepare and file with the Commission such amendments, including post-effective
amendments, to a Registration Statement and the Prospectus used in connection
therewith as may

 

4

 

be necessary to keep a
Registration Statement continuously effective as to the applicable Registrable
Securities for the Effectiveness Period and prepare and file with the
Commission such additional Registration Statements in order to register for
resale under the Securities Act all of the Registrable Securities; (ii) cause
the related Prospectus to be amended or supplemented by any required Prospectus
supplement (subject to the terms of this Agreement), and as so supplemented or
amended to be filed pursuant to Rule 424; (iii) respond as promptly as
reasonably possible, and in any event within 15 Trading Days, to any comments
received from the Commission with respect to a Registration Statement or any
amendment thereto and as promptly as reasonably possible provide the Holders
true and complete copies of all correspondence from and to the Commission
relating to a Registration Statement; and (iv) comply in all material respects
with the provisions of the Securities Act and the Exchange Act with respect to
the disposition of all Registrable Securities covered by a Registration
Statement during the applicable period in accordance (subject to the terms of
this Agreement) with the intended methods of disposition by the Holders thereof
set forth in such Registration Statement as so amended or in such Prospectus as
so supplemented.

 

(c)  If during the Effectiveness Period, the
number of Registrable Securities at any time exceeds 85% of the number of
shares of Common Stock then registered in a Registration Statement, then the
Company shall file as soon as reasonably practicable but in any case prior to
the applicable Filing Date, an additional Registration Statement covering the
resale by the Holders of not less than 150% of the number of such Registrable
Securities.

 

(d) Notify the
Holders of Registrable Securities to be sold (which notice shall, pursuant to
clauses (ii) through (vi) hereof shall be accompanied by an instruction to
suspend the use of the Prospectus until the requisite changes have been made)
as promptly as reasonably possible (and, in the case of (i)(A) below, not less
than five Trading Days prior to such filing) and (if requested by any such
Person) confirm such notice in writing no later than one Trading Day following
the day (i)(A) when a Prospectus or any Prospectus supplement or post-effective
amendment to a Registration Statement is proposed to be filed; (B) when the
Commission notifies the Company whether there will be a “review” of such
Registration Statement and whenever the Commission comments in writing on such
Registration Statement (the Company shall provide true and complete copies
thereof and all written responses thereto to each of the Holders); and (C) with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective; (ii) of any request by the Commission or any other
Federal or state governmental authority for amendments or supplements to a
Registration Statement or Prospectus or for additional information; (iii) of
the issuance by the Commission of any stop order suspending the effectiveness
of a Registration Statement covering any or all of the Registrable Securities
or the initiation of any Proceedings for that purpose; (iv) of the receipt by
the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction, or the initiation or threatening of
any Proceeding for such purpose; (v) of the occurrence of any event or passage
of time that makes the financial statements included in a Registration
Statement ineligible for inclusion therein or any statement made in a
Registration Statement or Prospectus or any document incorporated or deemed to
be incorporated therein by reference untrue in any material respect or that
requires any revisions to a Registration Statement, Prospectus or other
documents so that, in the case of a Registration Statement or the Prospectus,
as the case may be, it will not

 

5

 

contain any untrue statement of
a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and (vi) the
occurrence or existence of any pending corporate development with respect to
the Company that the Company believes may be material and that, in the
determination of the Company, makes it not in the best interest of the Company
to allow continued availability of the Registration Statement or Prospectus.

 

(e) Promptly
deliver to each Holder, without charge, as many copies of the Prospectus or
Prospectuses (including each form of prospectus) and each amendment or
supplement thereto as such Persons may reasonably request. Subject to the terms
of this Agreement, the Company hereby consents to the use of such Prospectus
and each amendment or supplement thereto by each of the selling Holders in
connection with the offering and sale of the Registrable Securities covered by
such Prospectus and any amendment or supplement thereto.

 

(f) Use
commercially reasonable efforts to register or qualify the resale of such
Registrable Securities as required under applicable securities or Blue Sky laws
of each State within the United States as any Holder requests in writing, to
keep each such registration or qualification (or exemption therefrom) effective
during the Effectiveness Period; provided, that the Company shall not be
required to qualify generally to do business in any jurisdiction where it is
not then so qualified or subject the Company to any material tax in any such
jurisdiction where it is not then so subject.

 

(g) Cooperate
with the Holders to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be delivered to a
transferee pursuant to a Registration Statement, which certificates shall be free,
to the extent permitted by the Subscription Agreement, of all restrictive
legends, and to enable such Registrable Securities to be in such denominations
and registered in such names as any such Holders may request.

 

(h) Upon the
occurrence of any event contemplated by this Section 3, as promptly as
reasonably possible under the circumstances taking into account the Company’s
good faith assessment of any adverse consequences to the Company and its
stockholders of the premature disclosure of such event, prepare a supplement or
amendment, including a post-effective amendment, to a Registration Statement or
a supplement to the related Prospectus or any document incorporated or deemed
to be incorporated therein by reference, and file any other required document
so that, as thereafter delivered, neither a Registration Statement nor such
Prospectus will contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. If the Company notifies the Holders in accordance with clauses
(ii) through (vi) of Section 3(d) above to suspend the use of any Prospectus
until the requisite changes to such Prospectus have been made, or the Company
otherwise notifies the Holders of its election to suspend the availability of a
Registration Statement and Prospectus pursuant to clause (vi) of Section 3(d),
then the Holders shall suspend use of such Prospectus.  The Company will use commercially reasonable
efforts to ensure that the use of the Prospectus may be resumed as promptly as
is practicable, except that in the case of suspension of the availability of a
Registration Statement and Prospectus pursuant to clause (vi) of Section 3(d),
the Company shall not be required to take such action until such time as it
shall

 

6

 

determine that the continued
availability of the Registration Statement and Prospectus is no longer not in
the best interests of the Company. 
Notwithstanding the Company’s right to suspend the use of the prospectus
hereunder, the Company shall remain liable to the Holders pursuant to Section
2(b) for any suspensions of the Registration Statement hereunder which
otherwise require payment thereunder.

 

(i) Use
commercially reasonable efforts to comply with all applicable rules and
regulations of the Commission.

 

(j) Use commercially reasonable efforts to
avoid the issuance of, or, if issued, obtain the withdrawal of (i) any order
suspending the effectiveness of a Registration Statement, or (ii) any
suspension of the qualification (or exemption from qualification) of any of the
Registrable Securities for sale in any jurisdiction, at the earliest
practicable moment.

 

(k) The
Company may require, at any time prior to the third Trading Day prior to the
Filing Date, each Holder to furnish to the Company a statement as to the number
of shares of Common Stock beneficially owned by such Holder and, if requested
by the Commission, the controlling person thereof, within three Trading days of
the Company’s request.  During any
periods that the Company is unable to meet its obligations hereunder with
respect to the registration of the Registrable Securities solely because any Holder
fails to furnish requested information within three Trading Days of the
Company’s request, any liquidated damages that are accruing at such time shall
be tolled  and any Event that may
otherwise occur solely because of such delay shall be suspended, until such
information is delivered to the Company.

 

4. Registration Expenses. All fees and expenses incident to the
performance of or compliance with this Agreement by the Company shall be borne
by the Company whether or not any Registrable Securities are sold pursuant to
the Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing
fees (including, without limitation, fees and expenses (A) with respect to
filings required to be made with the Principal Market on which the Common Stock
is then listed for trading, and (B) in compliance with applicable state
securities or Blue Sky laws (including, without limitation, fees and
disbursements of counsel for the Company in connection with Blue Sky
qualifications or exemptions of the Registrable Securities and determination of
the eligibility of the Registrable Securities for investment under the laws of
such jurisdictions as requested by the Holders)), (ii) printing expenses
(including, without limitation, expenses of printing certificates for
Registrable Securities and of printing prospectuses requested by the Holders),
(iii) messenger, telephone and delivery expenses, (iv) fees and disbursements
of counsel for the Company, and (v) fees and expenses of all other Persons
retained by the Company in connection with the consummation of the transactions
contemplated by this Agreement.  In
addition, the Company shall be responsible for all of its internal expenses
incurred in connection with the consummation of the transactions contemplated
by this Agreement (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), the expense
of any annual audit and the fees and expenses incurred in connection with the
listing of the Registrable Securities on any securities exchange as required
hereunder. In no event shall the Company be responsible for any underwriter,
broker or similar commissions or fees or, except to

 

7

 

the extent provided for in the
Transaction Documents, any legal fees or other costs of the Holders.

 

5. Indemnification

 

(a) Indemnification by the Company. The
Company shall, notwithstanding any termination of this Agreement, indemnify and
hold harmless each Holder, the officers, directors, agents, investment advisors
and employees of each Holder, each Person who controls any such Holder (within
the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act) and the officers, directors, agents and employees of each such
controlling Person, to the fullest extent permitted by applicable law, from and
against any and all losses, claims, damages, liabilities, costs (including,
without limitation, costs of preparation and reasonable attorneys’ fees) and
expenses (collectively, “Losses”), as incurred, arising out of or relating to
any untrue or alleged untrue statement of a material fact contained in a
Registration Statement, any Prospectus or any form of prospectus or in any
amendment or supplement thereto or in any preliminary prospectus, or arising
out of or relating to any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein (in the
case of any Prospectus or form of prospectus or supplement thereto, in light of
the circumstances under which they were made) not misleading, except to the
extent, but only to the extent, that (1) such untrue statements or omissions or
alleged untrue statements or omissions are based upon information regarding
such Holder furnished in writing to the Company by such Holder expressly for
use therein, or to the extent that such information relates to such Holder or
such Holder’s proposed method of distribution of Registrable Securities and was
reviewed and expressly approved in writing by such Holder expressly for use in
a Registration Statement, such Prospectus or such form of Prospectus or in any
amendment or supplement thereto or (2) in the case of an occurrence of an event
of the type specified in Section 3(d)(ii)-(vi), the use by such Holder of
an outdated or defective Prospectus after the Company has notified such Holder
in writing that the Prospectus is outdated or defective and prior to the receipt
by such Holder of the Advice contemplated in Section 6(e). The Company
shall notify the Holders promptly of the institution, threat or assertion of
any Proceeding arising from or in connection with the transactions contemplated
by this Agreement of which the Company is aware.

 

(b) Indemnification by Holders. Each Holder
shall, severally and not jointly, indemnify and hold harmless the Company, its
directors, officers, agents and employees, each Person who controls the Company
(within the meaning of Section 15 of the Securities Act and
Section 20 of the Exchange Act), and the directors, officers, agents or
employees of such controlling Persons, to the fullest extent permitted by
applicable law, from and against all Losses (as determined by a court of competent
jurisdiction in a final judgment not subject to appeal or review) arising out
of or relating to any untrue statement of a material fact contained in any
Registration Statement, any Prospectus, or any form of prospectus, or in any
amendment or supplement thereto, or arising out of or based upon: (i) such
Holder’s failure to comply with the prospectus delivery requirements of the
Securities Act or with the Plan of Distribution, or (ii) any omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading to the extent, but only to the extent, such untrue
statement or omission is contained in any information so furnished in writing
by such Holder to the Company specifically for inclusion in such Registration Statement
or such Prospectus or to the extent that (1) such untrue statements or

 

8

 

omissions are based upon
information regarding such Holder furnished in writing to the Company by such
Holder expressly for use therein, or to the extent such information relates to
such Holder or such Holder’s proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in the Registration Statement, such Prospectus or such form
of Prospectus or in any amendment or supplement thereto or (2) in the case of
an occurrence of an event of the type specified in Section 3(d)(ii)-(vi),
the use by such Holder of an outdated or defective Prospectus after the Company
has notified such Holder in writing that the Prospectus is outdated or
defective and prior to the receipt by such Holder of the Advice contemplated in
Section 6(e). In no event shall the liability of any selling Holder
hereunder be greater in amount than the dollar amount of the net proceeds
received by such Holder upon the sale of the Registrable Securities giving rise
to such indemnification obligation.

 

(c) Conduct of Indemnification Proceedings. If
any Proceeding shall be brought or asserted against any Person entitled to
indemnity hereunder (an “Indemnified Party”), such Indemnified Party
shall promptly notify the Person from whom indemnity is sought (the
“Indemnifying Party”) in writing, and the Indemnifying Party shall assume the
defense thereof, including the employment of counsel reasonably satisfactory to
the Indemnified Party and the payment of all fees and expenses incurred in
connection with defense thereof; provided, that the failure of any Indemnified
Party to give such notice shall not relieve the Indemnifying Party of its
obligations or liabilities pursuant to this Agreement, except (and only) to the
extent that such failure shall have prejudiced the Indemnifying Party.

 

An Indemnified
Party shall have the right to employ separate counsel in any such Proceeding
and to participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Party or Parties unless:
(1) the Indemnifying Party has agreed in writing to pay such fees and expenses;
or (2) the Indemnifying Party shall have failed promptly to assume the defense
of such Proceeding and to employ counsel reasonably satisfactory to such
Indemnified Party in any such Proceeding; or (3) the named parties to any such
Proceeding (including any impleaded parties) include both such Indemnified
Party and the Indemnifying Party, and such Indemnified Party shall have been
advised by counsel that a material conflict of interest is likely to exist if
the same counsel were to represent such Indemnified Party and the Indemnifying
Party (in which case, if such Indemnified Party notifies the Indemnifying Party
in writing that it elects to employ separate counsel at the expense of the
Indemnifying Party, the Indemnifying Party shall not have the right to assume
the defense thereof and the expense of one such counsel for each Holder shall
be at the expense of the Indemnifying Party). The Indemnifying Party shall not
be liable for any settlement of any such Proceeding effected without its
written consent, which consent shall not be unreasonably withheld. No
Indemnifying Party shall, without the prior written consent of the Indemnified
Party, effect any settlement of any pending Proceeding in respect of which any
Indemnified Party is a party, unless such settlement includes an unconditional
release of such Indemnified Party from all liability on claims that are the
subject matter of such Proceeding.

 

Subject to the
terms of this Agreement, all fees and expenses of the Indemnified Party
(including reasonable fees and expenses to the extent incurred in connection
with investigating or preparing to defend such Proceeding in a manner not
inconsistent with this Section) shall be

 

9

 

paid to the Indemnified Party,
as incurred, within ten Trading Days of written notice thereof to the
Indemnifying Party (regardless of whether it is ultimately determined that an
Indemnified Party is not entitled to indemnification hereunder; provided, that
the Indemnifying Party may require such Indemnified Party to undertake to
reimburse all such fees and expenses to the extent it is finally judicially
determined that such Indemnified Party is not entitled to indemnification
hereunder).

 

(d) Contribution. If a claim for
indemnification under Section 5(a) or 5(b) is unavailable to an
Indemnified Party (by reason of public policy or otherwise), then each
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Losses, in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Party and Indemnified Party in connection with the
actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations. 
The relative fault of such Indemnifying Party and Indemnified Party
shall be determined by reference to, among other things, whether any action in
question, including any untrue or alleged untrue statement of a material fact
or omission or alleged omission of a material fact, has been taken or made by,
or relates to information supplied by, such Indemnifying Party or Indemnified
Party, and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such action, statement or omission. The
amount paid or payable by a party as a result of any Losses shall be deemed to
include, subject to the limitations set forth in Section 5(c), any
reasonable attorneys’ or other reasonable fees or expenses incurred by such
party in connection with any Proceeding to the extent such party would have
been indemnified for such fees or expenses if the indemnification provided for
in this Section was available to such party in accordance with its terms.

 

The parties
hereto agree that it would not be just and equitable if contribution pursuant
to this Section 5(d) were determined by pro rata allocation or by any
other method of allocation that does not take into account the equitable
considerations referred to in the immediately preceding paragraph.  Notwithstanding the provisions of this
Section 5(d), no Holder shall be required to contribute, in the aggregate,
any amount in excess of the amount by which the proceeds actually received by
such Holder from the sale of the Registrable Securities subject to the
Proceeding exceeds the amount of any damages that such Holder has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission.

 

The indemnity
and contribution agreements contained in this Section are in addition to
any liability that the Indemnifying Parties may have to the Indemnified
Parties.

 

6. Miscellaneous

 

(a) Amendments and Waivers. The provisions of
this Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the same shall be in writing and
signed by the Company and all of the Holders of the then outstanding Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to depart from
the provisions hereof with respect to a matter that relates exclusively to the
rights of Holders and that does not directly or indirectly affect the rights of
other Holders may be given by Holders of all of the

 

10

 

Registrable Securities to which
such waiver or consent relates; provided, however, that the
provisions of this sentence may not be amended, modified, or supplemented
except in accordance with the provisions of the immediately preceding sentence.

 

(b) No Inconsistent Agreements. Neither the
Company nor any of its subsidiaries has entered, as of the date hereof, nor
shall the Company or any of its subsidiaries, on or after the date of this
Agreement, enter into any agreement with respect to its securities, that would
have the effect of impairing the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. Except as and to
the extent specified in Schedule 6(b) hereto, neither the Company nor any
of its subsidiaries has previously entered into any agreement granting any
registration rights with respect to a material amount of its securities to any
Person that have not been satisfied in full.

 

(c) No Piggyback on Registrations. Except as
and to the extent specified in Schedule 6(c) attached hereto, neither the
Company nor any of its security holders (other than the Holders in such
capacity pursuant hereto) may include securities of the Company in the
Registration Statement other than the Registrable Securities, and the Company
shall not after the date hereof enter into any agreement providing any such
right to any of its security holders. 
The Company shall not file any other registration statement on Form S-1
or S-3 until the initial Registration Statement required hereunder is declared
effective by the Commission, provided that this Section 6(c) shall not
prohibit the Company from filing amendments to registration statements already filed.

 

(d) Compliance. Each Holder covenants and
agrees that it will comply with the prospectus delivery requirements of the
Securities Act as applicable to it in connection with sales of Registrable
Securities pursuant to the Registration Statement.

 

(e) Discontinued Disposition. Each Holder
agrees by its acquisition of such Registrable Securities that, upon receipt of
a notice from the Company of the occurrence of any event of the kind described
in Sections 3(d)(ii) through (vi), such Holder will forthwith discontinue
disposition of such Registrable Securities under a Registration Statement until
such Holder’s receipt of the copies of the supplemented Prospectus and/or
amended Registration Statement contemplated by Section 3(h), or until it is
advised in writing (the “Advice”) by the Company that the use of the applicable
Prospectus may be resumed, and, in either case, has received copies of any
additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus or Registration Statement. The
Company may provide appropriate stop orders to enforce the provisions of this
paragraph. The Company agrees and acknowledges that any periods during which
the Holder is required to discontinue the disposition of the Registrable
Securities hereunder shall be subject to the provisions of Section 2(b).

 

(f) Piggy-Back Registrations. If at any time
during the Effectiveness Period there is not an effective Registration
Statement covering all of the Registrable Securities and the Company shall
determine to prepare and file with the Commission a registration statement
relating to an offering for its own account or the account of others under the
Securities Act of any of its equity securities, other than on Form S-4 or Form
S-8 (each as promulgated under the Securities Act) or their then equivalents
relating to equity securities to be issued solely in connection with any

 

11

 

acquisition of any entity or
business or equity securities issuable in connection with stock option or other
employee benefit plans, then the Company shall send to each Holder written
notice of such determination and, if within five Trading Days after receipt of
such notice, any such Holder shall so request in writing, the Company shall
include in such registration statement all or any part of such Registrable
Securities such holder requests to be registered; provided, that, the Company
shall not be required to give the foregoing notice with respect to or register
any Registrable Securities pursuant to this Section 6(f) that are eligible
for resale pursuant to Rule 144(k) promulgated under the Securities Act.

 

(g) Notices. Any and all notices or other
communications or deliveries required or permitted to be provided hereunder
shall be delivered as set forth in the Subscription Agreement.

 

(h) Successors and Assigns. This Agreement
shall inure to the benefit of and be binding upon the successors and permitted
assigns of each of the parties and shall inure to the benefit of each Holder.
The Company may not assign its rights or obligations hereunder without the
prior written consent of all of the Holders of the then-outstanding Registrable
Securities; provided, however that no such consent
shall be required in connection with: 
(a) a consolidation or merger of the Company with or into another
corporation or other entity or a sale, transfer or other disposition of all or
substantially all the Company’s property, assets or business to another
corporation or other entity; or (b) a reorganization or other transaction the
primary purpose of which is to change the jurisdiction of organization and/or
corporate form of the Company, provided that such merger, reorganization or
other transaction does not have an adverse tax impact upon the Purchasers with
respect to their purchase or sale of the Securities.  Any Purchaser may assign its rights under this Agreement and the
Registration Rights Agreement to any Person to whom such Purchaser assigns or
transfers any Securities.

 

(i) Counterparts. This Agreement may be
executed in any number of counterparts, each of which when so executed shall be
deemed to be an original and, all of which taken together shall constitute one
and the same Agreement. In the event that any signature is delivered by
facsimile transmission, such signature shall create a valid binding obligation
of the party executing (or on whose behalf such signature is executed) the same
with the same force and effect as if such facsimile signature were the original
thereof.

 

(j) Governing Law. All questions concerning
the construction, validity, enforcement and interpretation of this Agreement
shall be governed by and construed and enforced in accordance with the internal
laws of the State of California, without regard to the principles of conflicts
of law thereof. Each party hereby irrevocably submits to the exclusive
jurisdiction of the state and federal courts of Santa Clara County, California
for the adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is improper. Each party hereby irrevocably
waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the
address in effect for notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right
to serve process in any

 

12

 

manner permitted by law. Each
party hereto irrevocably waives, to the fullest extent permitted by applicable
law, and all right to trial by jury in any legal proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby. If either
party shall commence a Proceeding to enforce any provisions of this Agreement,
then the prevailing party in such Proceeding shall be reimbursed by the other
party for its attorneys fees and other costs and expenses incurred with the investigation,
preparation and prosecution of such Proceeding.

 

(k) Cumulative Remedies. The remedies provided
herein are cumulative and not exclusive of any remedies provided by law.

 

(l) Severability. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions set forth herein shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated, and the parties hereto shall use their reasonable efforts to find
and employ an alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or restriction.
It is hereby stipulated and declared to be the intention of the parties that
they would have executed the remaining terms, provisions, covenants and
restrictions without including any of such that may be hereafter declared
invalid, illegal, void or unenforceable.

 

(m) Headings. The headings in this Agreement
are for convenience of reference only and shall not limit or otherwise affect
the meaning hereof.

 

(n) Independent Nature of Purchasers’ Obligations and
Rights. The obligations of each Purchaser hereunder is several and
not joint with the obligations of any other Purchaser hereunder, and no
Purchaser shall be responsible in any way for the performance of the
obligations of any other Purchaser hereunder. Nothing contained herein or in
any other agreement or document delivered at any closing, and no action taken
by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any other kind
of entity, or create a presumption that the Purchasers are in any way acting in
concert with respect to such obligations or the transactions contemplated by
this Agreement. Each Purchaser shall be entitled to protect and enforce its
rights, including without limitation the rights arising out of this Agreement,
and it shall not be necessary for any other Purchaser to be joined as an
additional party in any proceeding for such purpose.

 

********************

 

13

 

IN WITNESS
WHEREOF, the parties have executed this Registration Rights Agreement as of the
date first written above.

 

 

	
   

  	
  METRON TECHNOLOGY
  N.V.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

14

 

Plan
of Distribution

 

The selling shareholders or any of their permitted
pledgees, donees, assignees and successors-in-interest may, from time to time,
sell any or all of their shares of common stock on any stock exchange, market
or trading facility on which the shares are traded or in private transactions.  These sales may be at fixed or negotiated
prices.  The selling shareholders may
use any one or more of the following methods when selling shares:

 

•                  ordinary
brokerage transactions and transactions in which the broker-dealer solicits
purchasers;

 

•                  block trades in
which the broker-dealer will attempt to sell the shares as agent but may
position and resell a portion of the block as principal to facilitate the
transaction;

 

•                  purchases by a
broker-dealer as principal and resale by the broker-dealer for its account;

 

•                  an exchange
distribution in accordance with the rules of the applicable exchange;

 

•                  privately
negotiated transactions;

 

•                  settlement of
short sales

 

•                  broker-dealers
may agree with the selling shareholders to sell a specified number of such
shares at a stipulated price per share;

 

•                  a combination of
any such methods of sale; and

 

•                  any other method
permitted pursuant to applicable law.

 

The selling
shareholders may also sell shares that qualify for sale pursuant to Rule 144
under the Securities Act, rather than under this prospectus.  In effecting sales, broker-dealers engaged
by the selling shareholders may arrange for other brokers-dealers to
participate in sales.  Broker-dealers may
receive commissions or discounts from the selling shareholders (or, if any broker-dealer
acts as agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated.  The selling shareholders do
not expect these commissions and discounts to exceed what is customary in the
types of transactions involved. 
Broker-dealers may agree to sell a specified number of such shares at a
stipulated price per share, and, to the extent such broker-dealer is unable to
do so acting as agent for us or a selling shareholder, to purchase as principal
any unsold shares at the price required to fulfill the broker-dealer
commitment.  Broker-dealers who acquire
shares as principal may thereafter resell such shares from time to time in
transactions, which may involve block transactions and sales to and through
other broker-dealers, including transactions of the nature described above, in
the over-the-counter markets or otherwise at pries and on terms then prevailing
at the time of sale, at prices than related to the

 

15

 

then-current market price or in
negotiated transactions.  In connection
with such resales, broker-dealers may pay to or receive from the purchasers
such shares commissions as described above.

 

The selling shareholder may from time to time pledge
or grant a security interest in some or all of the Shares or common stock or
Warrant owned by them and, if they default in the performance of their secured
obligations, the pledgees or secured parties may offer and sell the shares of
common stock from time to time under this prospectus, or under an amendment to
this prospectus under Rule 424(b)(3) or other applicable provision of the
Securities Act of 1933 amending the list of selling shareholders to include the
pledgee, transferee or other successors in interest as selling shareholders under
this prospectus.

 

The selling shareholders
also may transfer the shares of common stock in other circumstances, in which
case the transferees, pledgees or other successors in interest will be the
selling beneficial owners for purposes of this prospectus.

 

The selling shareholders
and any broker-dealers or agents that are involved in selling the shares may be
deemed to be “underwriters” within the meaning of the Securities Act in
connection with such sales.  In such event,
any commissions received by such broker-dealers or agents and any profit on the
resale of the shares purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act.  The selling shareholders have informed the Company that none of
them have any agreement or understanding, directly or indirectly, with any
person to distribute the common stock.

 

The Company is required
to pay all fees and expenses incurred by the Company incident to the
registration of the shares.  The Company
has agreed to indemnify the selling shareholders against certain losses,
claims, damages and liabilities, including liabilities under the Securities
Act.

 

16

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