CONSENT AND WAIVER
Consent to Assignment and Waiver of Rights ("Consent and Waiver"),
effective as of September 18, 2002, given by Merrimac Industries Inc. (the
"Company") to Ericsson Holding International B.V. ("Seller") and Infineon
Technologies AG ("Purchaser").
WHEREAS, Seller has entered into an agreement with Purchaser whereby
Seller and its affiliated companies have agreed to sell the microelectronics
business (excluding opto-semiconductors and power modules, but including the RF
power business) of the Ericsson Group (the "Business") to Purchaser;
WHEREAS, as part of the Business, Seller owns 475,000 shares of the
Company's common stock (the "Shares") and 475,000 common stock purchase rights
(the "Rights") issued under the Company's Rights Agreement, dated March 9, 1999,
as amended through the date hereof (the "Rights Agreement") and Seller has the
right to acquire 119,381 shares of the Company's common stock (and the
applicable Rights) at a Purchase Price of $17.80 per share (the "Warrant
Shares," and together with the Shares and the Rights, the "Securities") upon the
exercise of that certain Warrant, dated October 26, 2000 (the "Warrant");
WHEREAS, Seller and the Company are parties to the following
agreements: (i) that certain Stock Purchase and Exclusivity Letter Agreement,
dated April 7, 2000, as amended by that certain letter agreement dated February
1, 2002 (the "Letter Agreement"), (ii) that certain Registration Rights
Agreement, dated April 7, 2000 (the "April Registration Rights Agreement"),
(iii) that certain Registration Rights Agreement, dated October 26, 2000 (the
"October Registration Rights Agreement") and (iv) that certain Subscription
Agreement, dated as of October 26, 2000 (the "Subscription Agreement," and
together with the Letter Agreement, the April Registration Rights Agreement and
the October Registration Rights Agreement, the "Agreements"); and
WHEREAS, Purchaser is willing to purchase the Shares, the Rights and
the Warrant from Seller in connection with a purchase of the Business, subject
to, among other things: (i) Seller assigning to Purchaser, with the Company's
consent, the Agreements and the Warrant and all of Seller's rights, title and
interest in and to the Agreements and the Warrant and (ii) the waiver by the
Company of certain statutory rights under the Delaware General Corporation Law
(the "DGCL") and certain other rights in connection with the Rights Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. The Company hereby consents to the assignment by Seller to Purchaser
(or its affiliate) of the Agreements and the Warrant and all of
Seller's rights, title and interest in and to the Agreements and the
Warrant, as modified in accordance with that certain modification
agreement attached hereto as Exhibit A and incorporated by reference
herein (the "Modification Agreement").
2. Purchaser hereby agrees to assume, upon the assignment by Seller to
Purchaser of the Agreements and the Warrant, as modified by the
Modification Agreement, and all
of Seller's rights, title and interest in and to the Agreements and the
Warrant, all obligations of Seller under the Agreements and the
Warrant, as modified by the Modification Agreement, arising after the
effective date hereof. Seller and each of its affiliates are hereby
released and discharged from any and all duties, liabilities and
obligations arising under the Agreements after the effective date
hereof.
3. Subject to Section 2, the Company hereby acknowledges and agrees
that except as expressly amended by Purchaser and the Company in
writing in accordance with the Modification Agreement, each of the
Agreements and the Warrant shall remain in full force and effect in
accordance with its respective terms, without any waiver, amendment or
modification of any term, condition or provision thereof. Nothing
herein or otherwise is, or shall be deemed, a waiver of any right of
Seller (or Purchaser (or its assignee) as assignee of Seller, as the
case may be) or any obligation of the Company under any of the
Agreements or the Warrant. The Company hereby acknowledges and agrees
that the Agreements and the Warrant are in the form originally filed
with the Securities and Exchange Commission and that there have been no
amendments, modifications, supplements or other changes to any of the
Agreements or the Warrant from such forms other than the February
1,2002 amendment to the Letter Agreement, the number of Shares
purchasable, and the Purchase Price (as defined in the Warrant)
thereof, under the Warrant as set forth in the second recital hereof.
4. The Company represents and warrants to Purchaser that the Company
has, prior to the date hereof, amended the Rights Agreement in
substantially the form attached hereto as Exhibit B and incorporated by
reference herein. The Company hereby represents and warrants to
Purchaser that the Company's board of directors has, prior to the date
hereof, approved the acquisition by Purchaser of the Securities,
including, without limitation, the Warrant Shares upon exercise, if
any, of the Warrant, and the other transactions contemplated hereby,
including, without limitation, the Modification Agreement. The Company
represents and warrants to Purchaser that the restrictions in Section
203(a) of the DGCL do not apply to the Company. The Company covenants
and agrees that if, at any time after the date hereof, it is determined
that Section 203(a) of the DGCL applies to Purchaser in connection with
the Securities, including, without limitation, the Warrant Shares upon
exercise, if any, of the Warrant as modified by the Modification
Agreement, or otherwise in connection with the transactions
contemplated hereby, then the Company shall take or cause to be taken
all actions necessary to exempt Purchaser from such application.
Attached hereto as Annex X is a certificate duly executed by the
secretary of the Company certifying as to the incumbency of the
president of the Company and attaching and certifying as authentic duly
adopted minutes and resolutions of the Company's board of directors
reflecting (1) the approval of the acquisition by the Purchaser of the
Securities, (2) the adoption and approval of the amendment to the
Rights Agreement attached hereto as Exhibit A, (3) the determination by
the Company's board of directors to exempt each of the transactions
contemplated hereby from the application of Section 203 of the DGCL,
and (4) the adoption and approval of each of the other transactions
contemplated hereby, including, without limitation, the Modification
Agreement, with the incumbency of the secretary of the
Company certified by the president of the Company. The Company
represents and warrants, and such certificate shall certify, that the
resolutions attached to Annex X have not been modified, replaced or
supplemented since the date of their adoption, are in full force and
effect and are all of the resolutions applicable to any of the
foregoing. The Company further represents and warrants that this
Consent and Waiver has been duly executed and delivered and constitutes
the binding obligation of the Company, enforceable against the Company
in accordance with its terms.
5. This Consent and Waiver shall be governed by, and construed and
interpreted in accordance with, the laws of the State of New York,
without giving effect to any conflict of law provisions thereof. This
Consent and Waiver may not be amended, supplemented or modified nor may
the obligation of the parties hereto be waived, except by an instrument
in writing signed by each of the parties hereto and by Purchaser. This
Consent and Waiver may be executed in any number of counterparts each
of which when so executed shall be deemed an original and all of which
counterparts together shall constitute one and the same instrument.
[SIGNATURE TO FOLLOW]
IN WITNESS WHEREOF, each of the parties has caused this Consent and
Waiver to be duly executed as of the date first written above.
MERRIMAC INDUSTRIES INC.
By: /s/ Mason N. Carter
-------------------------
Name: Mason N. Carter
Title: Chief Executive Officer
ACKNOWLEDGED AND AGREED:
ERICSSON HOLDING INTERNATIONAL B.V.
By: /s/ CGJM Evers
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Name: CGJM Evers
Title: Controller
ACKNOWLEDGED AND AGREED:
INFINEON TECHNOLOGIES AG
By: /s/ Bogel
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Name: Bogel
Title: Corporate Legal Counsel
EXHIBIT A
Modification Agreement
(included as Exhibit 99.2 of this Form 8-K)
EXHIBIT B
Amendment No. 6 to Rights Agreement
(included as Exhibit 99.3 of this Form 8-K)