WARRANT TO PURCHASE SHARES OF COMMON STOCK OF
KEY TECHNOLOGY, INC.
CUSIP 493143 11 9
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This certifies that , the registered
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holder (the "Holder") is entitled to purchase from Key Technology, Inc., an
Oregon corporation (the "Company"), fully paid and nonassessable shares
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of the Company's Common Stock, subject to adjustment as provided herein, at any
time or from time to time up to and including 5:00 p.m. (Pacific Time) on
July 11, 2005, such date being referred to herein as the "Expiration Date," upon
surrender to the Company's Transfer Agent (or at such other location as the
Company may advise the Holder in writing) of this Warrant properly endorsed with
the Form of Subscription attached hereto duly filled in and signed and upon
payment of the purchase price for the number of shares for which this Warrant is
being exercised times a per-share purchase price of $15.00 per share (referred
to herein as the stock purchase price). The per-share stock purchase price and
the number of shares purchasable hereunder are subject to adjustment as provided
herein.
This Warrant is subject to the following terms and conditions:
1. Exercise; Issuance of Certificates; Payment for Shares.
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1.1 This Warrant is exercisable at the option of the holder of
record hereof, at any time or from time to time, up to the Expiration Date, for
all or any part of the shares of Common Stock which may be purchased hereunder.
Shares of Common Stock purchased under this Warrant shall be issued to the
Holder hereof as the record owner of such shares as of the close of business on
the date on which this Warrant shall have been surrendered, properly endorsed,
together with the completed Subscription Form attached hereto and payment for
such shares. Certificates for the shares of Common Stock so purchased shall be
delivered to the Holder hereof by the Company at the Company's expense within a
reasonable time after this Warrant has been so exercised. In case of a purchase
of less than all the shares which may be purchased under this Warrant, the
Company shall cancel this Warrant and execute and deliver a new Warrant or
Warrants of like tenor for the balance of the shares purchasable under the
Warrant surrendered upon such purchase to the Holder hereof within a reasonable
time. Each stock certificate so delivered shall be in such denominations of
Common Stock as may be requested by the Holder hereof and shall be registered in
the name of such Holder.
1.2 Net Issue Exercise. Notwithstanding any provisions herein to
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the contrary, if the fair market value of one share of the Company's Common
Stock is greater than the stock purchase price (at the date of calculation as
set forth below), in lieu of exercising this Warrant for cash, the Holder may
elect to receive shares equal to the value (as determined below) of this Warrant
(or the portion thereof being cancelled) by surrender of this Warrant at the
principal office of the company together with the properly endorsed Subscription
Form and notice of such election in which event the Company shall issue to the
Holder a number of shares of Common Stock computed using the following formula:
X = Y (A-B)
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A
Where X = the number of shares of Common Stock to be issued to
the Holder
Y = the number of shares of Common Stock purchasable
under the Warrant or, if only a portion of the Warrant
is being exercised, the portion of the Warrant being
cancelled (at the date of such calculation)
A = the Closing Price (as defined in the Warrant
Agreement) of one share of the Company's Common Stock,
as applicable (at the date of such calculation)
B = Exercise Price (as defined in the Warrant Agreement)
(as adjusted to the date of such calculation)
2. Shares to be Fully Paid; Reservation of Shares.
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The Company covenants and agrees that all shares of Common Stock
which may be issued upon the exercise of the rights represented by this Warrant
will, upon issuance, be duly authorized, validly issued, fully paid and
nonassessable and free from all preemptive rights of any shareholder and free of
all taxes, liens and charges with respect to the issue thereof. The Company
further covenants and agrees that during the period within which the rights
represented by this Warrant may be exercised, a sufficient number of shares of
authorized but unissued Common Stock will be reserved to provide for the
exercise of the rights represented by this Warrant. The Company will take all
such action as may be necessary to assure that such shares may be issued as
provided herein without violation of any applicable law or regulation, or of any
requirements of any domestic securities exchange upon which the Company's Common
Stock or this Warrant may be listed.
3. Adjustment of Stock Purchase Price and Number of Shares.
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In case the Company shall at any time split or subdivide its
outstanding shares of Common Stock into a greater number of shares, the stock
purchase price in effect immediately prior to such subdivisions shall be
proportionately reduced, and conversely, in case the outstanding shares of the
Common Stock of the Company shall be combined into a smaller number of shares,
the stock purchase price in effect immediately prior to such combination shall
be proportionately increased. Upon each adjustment of the stock purchase price,
the Holder of this Warrant shall thereafter be entitled to purchase, at the
stock purchase price resulting from such adjustment, the number of shares
obtained by multiplying the stock purchase price in effect immediately prior to
such adjustment by the number of shares purchasable pursuant hereto immediately
prior to such adjustment, and dividing the product thereof by the stock purchase
price resulting from such adjustment.
Upon any adjustment of the stock purchase price or any increase or
decrease in the number of shares purchasable upon the exercise of this Warrant,
the Company shall give
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written notice thereof, by first-class mail, postage prepaid, addressed to the
registered Holder of this Warrant at the address of such Holder as shown on the
books of the Company. The notice shall be signed by the Company's President or
Chief Financial Officer and shall state the stock purchase price resulting from
such adjustment and the increase or decrease, if any, in the number of shares
purchasable at such price upon the exercise of this Warrant, setting forth in
reasonable detail the method of calculation and the facts upon which such
calculation is based.
4. Notice of Certain Events.
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If at any time:
(a) the Company shall declare any dividend upon its Common
Stock payable in stock or make any special dividend or other distribution to the
holders of its Common Stock;
(b) there shall be any capital reorganization or
reclassification of the capital stock of the Company; or consolidation or merger
of the Company with, or sale of all or substantially all of its assets 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 said cases, the Company shall give, by first-class
mail, postage prepaid, addressed to the Holder of this Warrant at the address of
such Holder as shown on the books of the Company (i) at least 10 days' prior
written notice of the date on which the books of the Company shall close or a
record shall be taken for such dividend, distribution or subscription rights or
for determining rights to vote in respect of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding up, and (ii) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation, or winding up, at least
10 days' prior written notice of the date when the same shall take place. Any
notice given in accordance with the foregoing clause (i) shall also specify, in
the case of any such dividend, distribution or subscription rights, the date on
which a shareholder shall be entitled thereto. Any notice given in accordance
with the foregoing clause (ii) shall also specify the date on which shareholders
shall be entitled to exchange their shares for securities or other property
deliverable upon such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation, winding up, conversion or public offering, as
the case may be.
5. No Voting or Dividend Rights.
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Nothing contained in this Warrant shall be construed as conferring
upon the Holder hereof the right to vote or to consent to receive notice as a
shareholder of the Company or any other matters or any rights whatsoever as a
shareholder of the Company. No dividends or interest shall be payable or accrued
in respect of this Warrant or the interest represented hereby or the shares
purchasable hereunder until, and only to the extent that, this Warrant shall
have been exercised.
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6. Fractional Shares.
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No fractional shares shall be issued upon exercise of this Warrant.
The Company shall, in lieu of issuing any fractional share, pay the holder
entitled to such fraction a sum in cash equal to such fraction multiplied by the
then fair market value per share.
7. Right of Redemption.
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The Holder shall at all times prior to the Expiration Date and
except to the extent exercised have the right to require the Company to redeem
this Warrant for cash at a price equal to $10.00 for each whole share of Company
Common Stock that may be purchased under this Warrant. Upon any surrender for
redemption, any fractional share interests represented by this Warrant will be
redeemed for cash. To exercise this right of redemption, the Holder shall
surrender this Warrant, properly endorsed, to the Company's Transfer Agent,
together with the completed form of redemption notice attached hereto.
8. Warrant Agreement.
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This Warrant Certificate is subject to all of the terms, provisions
and conditions of the Warrant Agreement, dated as of July 12, 2000 (the "Warrant
Agreement"), between the Company and the Warrant Agent, to all of which terms,
provisions and conditions the registered holder of this Warrant Certificate
consents by acceptance hereof. The Warrant Agreement is incorporated herein by
reference and made a part hereof and reference is made to the Warrant Agreement
for a full description of the rights, limitations of rights, obligations, duties
and immunities of the Warrant Agent, the Company and the holders of the Warrant
Certificates. Copies of the Warrant Agreement are available for inspection at
the stock transfer office of the Warrant Agent or may be obtained upon written
request addressed to the Company.
IN WITNESS WHEREOF, the Company has caused this Warrant to be duly
executed by its officers, thereunto duly authorized, this day of
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, 2000.
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KEY TECHNOLOGY, INC.
By
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Thomas C. Madsen
President
004002\00131\353984 V001
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[Reverse of Warrant Certificate]
SUBSCRIPTION FORM
To Be Executed by the Registered Holder
in Order to Exercise or Redeem Warrants
(Check One)
[ ] The undersigned Registered Holder hereby irrevocably elects to
purchase Warrant Shares represented by this Warrant Certificate, and
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requests that certificates for such securities shall be issued in the name of
[ ] The undersigned Registered Holder, pursuant to Section 5.2
Warrant Agreement dated as of by and between Key Technology, Inc. (the
"Company") and ChaseMellon Shareholder Services, L.L.C (the "Warrant
Agreement"), hereby irrevocably elects to exchange Warrants represented
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by this Warrant Certificate for such number of Warrant Shares as are obtained by
applying the provisions of Section 5.2 of the Warrant Agreement, and requests
that certificates for such securities shall be issued in the name of
[ ] The undersigned Registered Holder, pursuant to Section 16.1 of
the Warrant Agreement and Section 7 of the Warrant Certificate, hereby
irrevocably (i) elects to have Warrants redeemed by the Company for cash
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at a price of $10.00 for each whole share of Company Common Stock that may be
purchased under the portion of the Warrant being redeemed, (ii) surrenders such
Warrants and all right, title and interest therein and (iii)directs that
promptly after the Company's receipt of this notice the cash amount deliverable
upon exercise of this redemption right be delivered to the address specified
below. The undersigned also hereby represents, warrants, and certifies that the
undersigned (a) has marketable and unencumbered title to such Warrants, free and
clear of the rights of or interest of any other person or entity, (b) has the
full right, power and authority to surrender for redemption such Warrants as
provided herein and (c) has obtained the consent or approval of all persons or
entities, if any, having the right to consult or approve such surrender for
redemption.
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
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[please print or type name and address]
and be delivered to
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[please print or type name and address]
and if such number of Warrants shall not be all the Warrants evidenced by this
Warrant Certificate, that a new Warrant Certificate for the balance of such
Warrants be registered in the name of, and delivered to, the Registered Holder
at the address stated below.
The undersigned represents that the exercise of the within Warrant was solicited
by a member of the National Association of Securities Dealers, Inc. Specify the
name of the NASD member below. If not solicited by an NASD member, please write
"unsolicited" in the space below.
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(Name of NASD Member)
Dated: X
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Address
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Taxpayer Identification Number
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Signature Guaranteed
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ASSIGNMENT
To Be Executed by the Registered Holder
in Order to Assign Warrants
FOR VALUE RECEIVED, hereby
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sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
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[please print or type name and address]
of the Warrants represented by this Warrant
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Certificate, and hereby irrevocably constitutes and appoints
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Attorney to transfer this Warrant Certificate on the books of the Company, with
full power of substitution in the premises.
Dated: X
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Signature Guaranteed
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THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND MUST BE
GUARANTEED BY A MEMBER OF THE MEDALLION STAMP PROGRAM.
004002\00131\353981 V001