THIS WARRANT (THIS "WARRANT") AND THE UNDERLYING SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT have not been registered under the Securities Act of 1933, as amended (the "SECURITIES Act"), or the securities laws of any state, and may not be offered, transferred, pledged, hypothecated, sold or otherwise disposed of unless a registration statement under the Securities Act and applicable state securities laws shall have become effective with regard thereto, or an exemption from registration under the Securities Act and applicable state securities laws is available in connection with such offer or sale.
Warrant No. 120 Date of Issuance: June 22, 2009
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MICROVISION, INC.
COMMON STOCK PURCHASE WARRANT
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This certifies that, for good and valuable consideration, Microvision, Inc., a Delaware corporation (the "Company"), grants to the holder of this Warrant (the "Warrantholder"), which on the date hereof shall be Max Display Enterprises Limited (the "Initial Holder"), the right to subscribe for and purchase from the Company 2,019,060 validly issued, fully paid and nonassessable shares (the "Warrant Shares") of the Company's Common Stock, par value $0.001 per share (the "Common Stock"), at the purchase price per share of $2.1850 (as adjusted pursuant to the provisions of this Warrant, the "Exercise Price"), at any time and from time to time on or after the date hereof to and including 11:59 P.M. Seattle Time on June 22, 2012 (the "Expiration Date"), all subject to the terms, conditions and adjustments herein set forth. The number of Warrant Shares and the Exercise Price shall be subject to further adjustment in accordance with Section 5.
This Warrant is issued pursuant to the Securities Purchase Agreement (the "Securities Purchase Agreement") by and between the Initial Holder and the Company, dated as of the date hereof, and the Initial Holder and the Company are each parties to the Registration Rights Agreement (the "Registration Rights Agreement"), dated as of the date hereof, a copy of each of which is on file at the principal office of the Company. Accordingly, the Warrantholder shall be entitled to all of the benefits and bound by all of the applicable obligations set forth in the Securities Purchase Agreement and the Registration Rights Agreement. Any capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Securities Purchase Agreement.
1.2.1. Right to Convert. If and only if at the time of exercise there is not then effective a registration statement filed under the Securities Act registering the resale of the Warrant Shares issuable on exercise hereof, then in addition to, and without limiting, the other rights of the Warrantholder hereunder, the Warrantholder shall have the right (the "Conversion Right") to convert this Warrant or any part hereof into Warrant Shares at any time and from time to time prior to the Expiration Date. Upon exercise of the Conversion Right, the Company shall deliver to the Warrantholder, without payment by the Warrantholder of any Exercise Price or any cash or other consideration, that number of Warrant Shares computed using the following formula:
X = Y (A-B)
A
Where: X = The number of Warrant Shares to be issued to the Warrantholder
Y = The number of Warrant Shares purchasable pursuant to this Warrant at such time or such lesser number of Warrant Shares as may be selected by the Warrantholder in the Notice of Conversion (as defined herein)
A = The Market Price (as such term is defined in the Securities Purchase Agreement) as of the Conversion Date
B = The Exercise Price
1.2.2. Method of Conversion. The Conversion Right may be exercised by the Warrantholder by the surrender of this Warrant to the Company, together with a duly executed Notice of Conversion in the form attached as Exhibit B hereto (the "Notice of Conversion") specifying that the Warrantholder intends to exercise the Conversion Right and indicating the number of Warrant Shares to be acquired upon exercise of the Conversion Right. Such conversion shall be effective upon the Company's receipt of this Warrant, together with the Notice of Conversion, or on such later date as is specified in the Notice of Conversion (the "Conversion Date"). Certificates for the Warrant Shares so acquired shall be promptly delivered to the Warrantholder, in any event not to exceed three (3) Business Days after the Conversion Date in accordance with Section 1.3. If applicable, the Company shall, upon surrender of this Warrant for cancellation, deliver a new Warrant evidencing the rights of the Warrantholder to purchase the remaining Warrant Shares which new Warrant shall in all other respects be identical to this Warrant.
This Warrant shall expire and no longer be exercisable or convertible into Warrant Shares, and its provisions shall have no further force or effect, whether or not any portion thereof has been previously exercised or converted, upon the earlier to occur of (i) the first date upon which this Warrant has been exercised for or converted into the maximum amount of Warrant Shares available for issuance upon an exercise or conversion of this Warrant at such time, (ii) the last day of the Notice Period as provided in Section 7 with respect to all Warrant Shares subject to redemption and (iii) the Expiration Date.
Upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, of such indemnification as the Company may reasonably require, and, in the case of such mutilation, upon surrender and cancellation of this Warrant, the Company will execute and deliver a new Warrant of like tenor.
The Company may deem and treat the person in whose name this Warrant is registered as the holder and owner hereof (notwithstanding any notations of ownership or writing thereon made by anyone other than the Company) for all purposes and shall not be affected by any notice to the contrary, other than a transfer pursuant to Section 6.
This Warrant and the Warrant Shares issued upon the exercise thereof may be transferred only in compliance with Section 4.4 of the Securities Purchase Agreement and the other restrictions on transfer set forth in the Registration Rights Agreement. Subject to such restrictions, the Company shall transfer this Warrant from time to time upon the books to be maintained by the Company for that purpose, upon surrender hereof for transfer, properly endorsed or accompanied by appropriate instructions for transfer and such other documents as may be reasonably required by the Company, including, if required by the Company, an opinion of its counsel reasonably satisfactory to the Company to the effect that such transfer is exempt from the registration requirements of the Act, to establish that such transfer is being made in accordance with the terms hereof, and a new Warrant shall be issued to the transferee and the surrendered Warrant shall be canceled by the Company.
Upon such transfer or other disposition, the Warrantholder shall deliver this Warrant to the Company together with a written notice to the Company, substantially in the form of the Transfer Notice in the form attached hereto as Exhibit C (the "Transfer Notice"), indicating the person or persons to whom this Warrant shall be transferred and, if less than all of this Warrant is transferred, the number of Warrant Shares to be covered by the part of this Warrant to be transferred to each such person. Within three (3) Business Days of receiving a Transfer Notice and the original of this Warrant, the Company shall deliver to the each transferee designated by the Warrantholder a Warrant or Warrants of like tenor and terms for the appropriate number of Warrant Shares and, if less than all this Warrant is transferred, shall deliver to the Warrantholder a Warrant for the remaining number of Warrant Shares.
Notwithstanding any other provision contained in this Warrant to the contrary, in the event that the average closing bid prices per share of Common Stock, as quoted on the Nasdaq Global Market (or such other exchange or stock market on which the Common Stock may then be listed or quoted) over a period of 20 consecutive Trading Days, as defined in the Securities Purchase Agreement, ending on or after the sixth (6th)-month anniversary of the date hereof, exceeds 400% of the Exercise Price then in effect, thereafter the Company, upon fifteen (15) Business Days prior written notice (the "Notice Period") ending at 11:59 P.M. (Seattle time) on the fifteenth (15th) Business Day (not counting the day such notice is given) given to the Warrantholder within ten (10) Business Days of the end of such 20 consecutive Trading Day period, may call the Warrant, in whole or in part, at a redemption price equal to $0.01 per share of Common Stock then purchasable pursuant to the Warrant called for redemption provided that (a) at all times during the Notice Period, there is an effective registration statement filed under the Securities Act registering the resale of the Warrant Shares issuable on exercise hereof; (b) the Warrantholder shall have the right to exercise this Warrant prior to the end of the Notice Period and (c) if the Warrantholder is Max Display Enterprises Limited or an Affiliate of Walsin Lihwa at the time, the written notice shall be given by the Company to the Warrantholder by both electronic mail and an international overnight courier at the address set forth in Section 8.5 hereof.
(a) if to the Company, addressed to:
Microvision, Inc.
6222 185th Avenue NE
Redmond, WA 98052
Attn: General Counsel
Tel: (425) 415-6847
Fax: (425) 936-4411
Ropes & Gray LLP
One International Place
Boston, MA 02110
Attn: Joel F. Freedman
Tel: (617) 951-7000
Fax: (617) 951-7050
(b) if to the Warrantholder, addressed to:
Max Display Enterprises Limited
c/o Walsin Lihwa Corporation
11F, No. 411
Rueiguang Road, Neihu
Taipei 114
Taiwan, R.O.C.
Attn: Jeff Chen and Sandy Yu
Tel: 886-2-2799-2211 x 6221 (Jeff Chen) / x 6136 (Sandy Yu)
Fax: 886-2-2799-8980
with a copy (which shall not constitute notice) to:
Simpson Thacher & Bartlett LLP
ICBC Tower - 35th Floor
3 Garden Road, Central
Hong Kong
Attn: Chris K. H. Lin
Tel: (852) 2514-7600
Fax: (852) 2869-7694
[Remainder of page intentionally left blank; signature page follows]
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its duly authorized officer as of the date first above written.
MICROVISION, INC.
By: /s/ Jeff T. Wilson______________
Name: Jeff T. Wilson
Title: Chief Financial Officer
ACCEPTED AND AGREED:
MAX DISPLAY ENTERPRISES LIMITED |
By:__/s/ Chiao Yu Lon___________ |
Name: Chiao Yu Lon |
Title: Director |
EXHIBIT A
FORM OF NOTICE OF EXERCISE
To: Microvision, Inc. ("the Company")
1. The undersigned hereby elects to purchase __________ shares of the Common Stock of the Company (the "Common Stock") pursuant to the terms of the Warrant, dated as of June 22, 2009 (the "Warrant") and tenders herewith payment of the purchase price of such shares in full.
2. Please issue or cause to be issued a certificate or certificates representing said shares in the name of the undersigned.
3. The undersigned hereby represents and warrants to the Company that it is the registered and beneficial owner of the portion of the Warrant which is the subject of this Notice of Exercise.
4. The undersigned acknowledges that each certificate for Common Stock issued upon exercise of the Warrant may bear a legend in accordance with Section 2.5 of the Securities Purchase Agreement, dated as of June 22, 2009 by and between the Company and Max Display Enterprises Limited.
5. Solely with respect to the shares of Common Stock being received pursuant to this Notice of Exercise, the representations and warranties of the Warrantholder, in its capacity as the "Purchaser", contained in the Securities Purchase Agreement are hereby repeated at and as of the time of delivery hereof and are true and correct in all respects at and as of the time of delivery hereof.
6. The undersigned hereby agrees that the restrictions on transfer described in Section 6 of the Warrant shall survive any and all exercises of the Warrant and shall be applicable to any and all of the shares of Common Stock issued on exercise thereof.
(Name of Registered Owner)
(Signature of Registered Owner)
(Street Address)
(City) (State) (Zip Code)
Date: _____________________
EXHIBIT B
FORM OF NOTICE OF CONVERSION
To: Microvision, Inc. ("the Company")
1. The undersigned registered owner irrevocably elects to surrender the Warrant, dated as of June 22, 2009 (the "Warrant"), for the number of shares of Common Stock of the Company ("Common Stock") as shall be issuable pursuant to the conversion right provisions of Section 1.2 of the Warrant, in respect of _____ shares of Common Stock underlying the Warrant.
2. Please issue or cause to be issued a certificate or certificates representing said shares in the name of the undersigned, and return cash to the undersigned for any fractional shares.
3. The undersigned hereby represents and warrants to the Company that it is the registered and beneficial owner of the portion of the Warrant which is the subject of this Notice of Conversion.
4. The undersigned acknowledges that each certificate for Common Stock issued upon exercise of the Warrant may bear a legend in accordance with Section 2.5 of the Securities Purchase Agreement, dated as of June 22, 2009 by and between the Company and Max Display Enterprises Limited.
5. The undersigned hereby agrees that the restrictions on transfer described in Section 6 of the Warrant shall survive any and all exercises of the Warrant and shall be applicable to any and all of the shares of Common Stock issued on exercise thereof.
(Name of Registered Owner)
(Signature of Registered Owner)
(Street Address)
(City) (State) (Zip Code)
Date:_____________________
EXHIBIT C
FORM OF TRANSFER NOTICE
To: Microvision, Inc. ("the Company")
FOR VALUE RECEIVED, the undersigned Warrantholder of the attached Warrant hereby sells, assigns and transfers unto the person or persons named below the right to purchase shares of the Common Stock of [ ] evidenced by the attached Warrant.
Date:
Name of Registered Warrantholder
By:
Name:
Title:
Transferee Name and Address:
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