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EXHIBIT 4.2
RF MICRO DEVICES, INC. HAS REQUESTED THAT A CERTAIN PORTION OF THIS EXHIBIT BE
GIVEN CONFIDENTIAL TREATMENT. SUCH PORTION HAS BEEN REDACTED IN THIS DOCUMENT
AND FILED SEPARATELY WITH THE COMMISSION. THE REDACTED MATERIAL IS DENOTED
HEREIN BY ******.
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAS BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE
SECURITIES LAWS OF ANY STATE AND NEITHER THIS WARRANT NOR SUCH SECURITIES MAY BE
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT AND LAWS UNLESS RF MICRO DEVICES, INC. RECEIVES AN
OPINION OF COUNSEL, WHICH MAY BE HOLDER'S IN-HOUSE COUNSEL, REASONABLY
ACCEPTABLE TO IT THAT SUCH REGISTRATION IS NOT REQUIRED. TRANSFER OF THIS
WARRANT IS RESTRICTED. SEE PARAGRAPH 11.
500,000 Shares WARRANT NO. 99-2
RF MICRO DEVICES, INC.
A North Carolina Corporation
(Void after 5:00 p.m.,
Washington D.C. Time, on December 31, 2001)
THIS CERTIFIES THAT, for value received, TRW Inc. (the
"Holder") is entitled at any time after December 31, 2000 and at any time before
5:00 p.m. Washington D.C. time on December 31, 2001 (the "Expiration Time") to
purchase up to 500,000 (five hundred thousand) shares (the "RFMD Shares") of
common stock, no par value (the "Common Shares"), of RF Micro Devices, Inc. (the
"Company") at the price per RFMD Share as determined in paragraph 1 of this
Warrant, subject to adjustment as provided in paragraph 5 of this Warrant (that
price, as it may be adjusted from time to time, being referred to as the
"Warrant Price").
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1. (a) The Warrant Price shall be the average of the Closing
Prices of the Common Shares during the ten (10) Trading Days immediately
preceding December 31, 2000 (the "Pricing Period") multiplied by 0.75. The
Closing Price for each day shall be the reported last sales price regular way
or, in case no such reported sale takes place on such day, the average of the
reported closing bid and asked prices regular way, in either case on the New
York Stock Exchange or, if the Common Shares are not listed or admitted to
trading on such Exchange, on the principal national securities exchange on which
the Common Shares are listed or admitted to trading (based on the aggregate
dollar value of all securities listed or admitted to trading) or, if not listed
or admitted to trading on any national securities exchange, on the NASDAQ
National Market System or, if the Common Shares are not listed or admitted to
trading on any national securities exchange or quoted on the NASDAQ National
Market System, the average of the closing bid and asked prices in the
over-the-counter market as furnished by any New York Stock Exchange member firm
selected from time to time by the Company for that purpose. The Closing Prices
during the Pricing Period shall be adjusted to take into account any stock
divisions, stock combinations, stock recapitalizations or reclassifications,
stock dividends and the like in order that the Closing Prices during the entire
Pricing Period shall have the same reference point as the Closing Price
immediately prior to December 31, 2000. The average of the Closing Prices shall
be a simple average and shall not be weighted according to trading volume or any
other manner. "Trading Day" shall mean a day on which the national securities
exchange or the NASDAQ National Market System used to determine the Closing
Price is open for the transaction of business or the reporting of trades or, if
the Closing Price is not so
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determined, a day on which the New York Stock Exchange is open for the
transaction of business.
(b) This Warrant shall not be exercisable, and shall become
null and void, unless the Company has "Annualized Sales" of Licensed Products
(as defined in the License Agreement, dated as of November 15, 1999, between the
Company and the Holder) of at least $******. For the purposes of this Warrant,
"Annualized Sales" may be calculated as of any fiscal quarter ending on or prior
to the Expiration Time and shall be equal to the product of four times the gross
revenues from the sale of the Licensed Products during such fiscal quarter,
computed in accordance with generally accepted accounting principles. The
Company shall deliver to the Holder a regular quarterly report that shows its
revenues from sales of Licensed Products during the preceding fiscal quarter and
its Annualized Sales of Licensed Products as of such fiscal quarter end. The
Expiration Time shall be extended until the fifth (5th) business day after the
delivery by the Company of its quarterly report for the quarter ending December
31, 2001 if the Annualized Sales threshold has not been met prior to such
quarter. In the event of a "Change in Control" of the Company at any time prior
to the Expiration Time, the Annualized Sale requirement described in this
subparagraph shall have no effect and the Warrant will become exercisable at the
time provide elsewhere in, and pursuant to the terms of, this Warrant. As used
herein, "Change in Control" means the occurrence of any of the following: (i)
the sale by the Company of all or substantially all of its assets; or (ii) the
participation by the Company as constituent corporation in a merger or
consolidation if the shareholders of the Company immediately prior to the
effective time of such transaction own less than fifty percent (50%) of the
outstanding voting securities of the surviving corporation.
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2. To exercise this Warrant, this Warrant must be surrendered
prior to the Expiration Time at the office of the Company at 7625 Thorndike
Road, Greensboro, North Carolina 27409 (or such other address as the Company may
specify in writing to the Holder of this Warrant at least ten days before this
Warrant is exercised) with the attached Notice of Exercise duly completed and
executed, accompanied by evidence of a wire transfer of immediately available
funds to the Company's money market account #____________ with Silicon Valley
Bank, Santa Clara, California, ABA Routing #____________ (or such other account
as the Company may specify in writing to the Holder of this Warrant at least ten
days before this Warrant is exercised) in full payment of the purchase price of
the RFMD Shares with respect to which this Warrant is exercised. This Warrant
may be exercised in whole or in part as to any whole number of RFMD Shares. If
this Warrant is exercised in part, upon surrender of this Warrant for exercise,
the Company will issue to the Holder a new Warrant to purchase the remaining
number of RFMD Shares which may be purchased upon exercise of this Warrant
(before taking account of adjustments by reason of paragraphs 5, 6 and 7) and
the number of RFMD Shares with respect to which it is exercised (before taking
account of adjustments by reason of paragraphs 5, 6 and 7). The new Warrant will
bear the same date as this Warrant and will be identical to this Warrant in all
respects, except as to the number of RFMD Shares as to which it may be
exercised.
3. The RFMD Shares as to which this Warrant is exercised will
be deemed to be issued when this Warrant is exercised. Holder agrees that prior
to the exercise of this Warrant, it will comply with the provisions of the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act")
as in effect from time to time. If action is taken by the Federal Trade
Commission or the United States
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Department of Justice to enjoin Holder's exercise of this Warrant, the Company
agrees reasonably to cooperate with Holder to contest such enjoinment at the
expense of this Holder. A certificate representing the RFMD Shares will be
issued to the Holder of this Warrant promptly after it is exercised. The
certificate may bear a legend to the effect that the RFMD Shares it represents
have not been registered under the Securities Act of 1933, as amended (the
"Act"), or any applicable state securities laws, and may only be transferred in
a transaction registered under the Act or such laws or exempt from the
registration requirements of the Act or such laws. In addition, any other legend
required by any other agreement between the Company and Holder may be included
on the certificate or certificates for such RFMD Shares.
4. This Warrant will expire, and the right to purchase the
RFMD Shares by exercise of this Warrant will terminate, at the Expiration Time;
provided, however, that if Holder has complied with the filing provisions of the
HSR Act at least thirty days prior to the Expiration Time, but the waiting
period imposed by the HSR Act has not terminated or lapsed, then the Expiration
Time will be extended until ten days after such termination or lapse. After that
time this Warrant will be void.
5. The Warrant Price will be subject to adjustment from time
to time as follows:
(a) If, at any time after December 31, 2000, the Company (i)
pays a dividend on its Common Stock in Common Stock, (ii) splits or
subdivides its outstanding shares of Common Stock, or (iii) combines
its outstanding shares of Common Stock into a smaller number of shares,
the Warrant Price in effect immediately prior to each of those events
will be adjusted proportionately so that the adjusted Warrant Price
will bear the same relation to the Warrant Price in
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effect immediately prior to the event as the total number of shares of
Common Stock outstanding immediately prior to the event will bear to
the total number of shares of Common Stock outstanding immediately
after the event.
(b) An adjustment made pursuant to subparagraph (a) of this
paragraph will become effective immediately after the corresponding
record date in the case of a dividend and immediately after the
effective date in the case of a subdivision or combination.
No adjustment of the Warrant Price will be made if the amount
of such adjustment would be less than 2% of the Warrant Price, but any such
adjustment that would otherwise be required to be made and has not previously
been made will be carried forward and be made at the time of and together with
the next subsequent adjustment which, together with all adjustments so carried
forward, amount in the aggregate to 2% or more of the Warrant Price. As used in
this Warrant, "Common Stock" includes any class of the Company's capital stock,
now or hereafter authorized, having the right to participate in the distribution
of either earnings or assets of the Company without limitation as to amount or
percentage. At no time will the Warrant Price be less than $.01 per share.
6. (a) In case the Company shall at any time or from time to
time (i) subdivide its outstanding shares of Common Stock into a greater number
of shares or (ii) combine its outstanding shares of Common Stock into a smaller
number of shares, then the number of RFMD Shares, in effect immediately prior to
such event, shall be proportionately increased in the case of a subdivision and
proportionately decreased in the case of combination. Any adjustment under this
subparagraph 6(a) shall become effective at the close of business on the date
the subdivision or combination becomes
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effective.
(b) In case the Company shall at any time or from time to time
makes, or fixes a record date for the determination of holders of the Common
Stock entitled to receive, a dividend or other distribution payable in
additional shares of Common Stock, then and in such event the number of RFMD
Shares then in effect shall be increased as of the time of such issuance or, in
the event such record date is fixed, as of the close of business on such record
date, by multiplying the number of RFMD Shares then in effect by a fraction (x)
the denominator of which is the total number of shares of the Common Stock
issued and outstanding immediately prior to the time of such issuance or the
close of business on such record date, and (y) the numerator of which shall be
the total number of shares of the Common Stock issued and outstanding
immediately prior to the time of such issuance or the close of business on such
record date plus the number of shares of the Common Stock issuable in payment of
such dividend or distribution; provided, however, that if such record date is
fixed and such dividend is not fully paid or if such distribution is not fully
made on the date fixed therefor, the number of RFMD Shares shall be recomputed
accordingly based on the number of additional shares of Common Stock actually
issued as of the close of business on the date originally fixed for the payment
of such dividend or the making of such distribution and thereafter the number of
RFMD Shares shall be adjusted pursuant to this subparagraph 6(b) at the time of
actual payment of any additional dividends or distributions of Common Stock.
(c) In case the Company shall issue rights or warrants to all
or substantially all holders of its Common Stock entitling them to subscribe for
or purchase shares of Common Stock at a price per share less than the Fair
Market Value (as hereinafter defined) per share of the Common Stock on the date
fixed for the determination of shareholders entitled to receive such rights or
warrants, the number of
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RFMD Shares, in effect at the opening of business on the day following the date
fixed for such determination, shall be increased by multiplying such number of
RFMD Shares by a fraction of which the denominator shall be the number of shares
of Common Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock which the aggregate of
the offering price of the total number of shares of Common Stock so offered for
subscription or purchase would purchase at such Fair Market Value, and the
numerator shall be the number of shares of Common Stock outstanding at the close
of business on the date fixed for such determination plus the number of shares
of Common Stock so offered for subscription or purchase, such adjustment to
become effective immediately after the opening of business on the day following
the date fixed for such determination; provided, however, in the event that all
the shares of Common Stock offered for subscription or purchase are not
delivered upon the exercise of such rights or warrants, the number of RFMD
Shares shall be readjusted to the number of RFMD Shares that would have been in
effect had the numerator and the denominator of the foregoing fraction and the
resulting adjustment been made based upon the number of shares of Common Stock
actually delivered upon the number of shares of Common Stock offered for
subscription or purchase. For the purposes of this subparagraph (c), the number
of shares of Common Stock at any time outstanding shall not include shares held
in the treasury of the Company. "Fair Market Value" shall mean, as to shares of
Common Stock the simple average of the daily Closing Prices for the ten (10)
consecutive Trading Days immediately preceding the day in question.
7. (a) In case of a distribution to all holders of the
Company's Common Stock of shares of its capital stock (other than Common Stock)
or evidences of its indebtedness or property, or a capital reorganization of the
Company, a reclassification of the Common Stock, a consolidation of the Company
with or merger of the Company
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into another corporation or entity (but only if such consolidation or merger is
consummated after December 31, 2000) (other than a consolidation or merger in
which the Company is the continuing entity) or a sale of the properties and
assets of the Company (but only if such sale is consummated after December 31,
2000) as, or substantially as, an entirety and distribution of the proceeds of
sale, after such distribution, capital reorganization, reclassification,
consolidation, merger or sale, on exercise of this Warrant the Holder will
receive the number of shares of stock or other securities or property which the
Holder would have received if this Warrant had been exercised immediately before
the first such corporate event and the Holder had retained what it would have
received as a result of each such corporate event. The split or subdivision or
combination of shares of Common Stock at any time outstanding into a greater or
lesser number of shares of Common Stock will not be deemed to be a
reclassification of the Common Stock of the Company for the purposes of this
paragraph. The Company will not effect any consolidation or merger unless prior
to or simultaneously with its consummation the successor entity (if other than
the Company) resulting from the consolidation agrees in writing to deliver to
the Holder of this Warrant on exercise of this Warrant the shares of stock or
other securities or property to which the Holder becomes entitled because of
that exercise.
(b) In the event that at any time prior to December 31, 2000,
the Company (i) consolidates or merges with another corporation or entity (other
than a consolidation or merger of the Company in which the Company is the
continuing entity) or (ii) sells its properties and assets as, or substantially
as, an entirety and distributes the proceeds, this Warrant shall terminate
immediately upon the consummation of such consolidation, merger or sale and the
Holder shall be promptly paid by the Company (or the Company's
successor-in-interest, as the case may be) a dollar amount equal to the number
of RFMD Shares purchasable hereunder multiplied by the positive difference (if
any) between the Closing Price of the Common Shares as of the last Trading Day
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immediately prior to the effective date of such consolidation, merger or sale
and $71.50 (as adjusted for any stock divisions, stock combinations, stock
recapitalizations, stock reclassifications, stock dividends or similar
transactions occurring after the date of this Warrant).
8. Whenever the Warrant Price and/or the number of RFMD Shares
is adjusted as provided in this Warrant, the Company will compute the adjusted
Warrant Price and/or the number of RFMD Shares or other assets the Holder would
receive on exercise of this Warrant in full and will provide a notice to the
Holder within thirty (30) days of the date of such adjustment stating that the
Warrant Price and/or the number of RFMD Shares has been adjusted and setting
forth the adjusted Warrant Price and/or the number of RFMD Shares and what the
Holder would receive upon exercise of this Warrant in full. The Company will
also provide a notice to the Holder describing any event that would trigger an
adjustment in the Warrant Price and/or the number of RFMD Shares in the absence
of the last paragraph of paragraph 5. Such notice will be given within thirty
(30) days of the effective date of such event.
9. The Company will at all times keep a sufficient number of
authorized but unissued RFMD Shares to permit exercise in full of this Warrant.
The Company represents and warrants that all RFMD Shares which are delivered on
exercise of this Warrant (and payment of the Warrant Price therefor) will, upon
delivery, be duly issued, fully paid and non-assessable.
10. The Holder will not, by reason of holding this Warrant,
have any right to vote, to receive dividends or other distributions, or any
other rights of a shareholder, with regard to the RFMD Shares.
11. The Holder may not assign, sell or otherwise transfer,
dispose of, make any short sale of, pledge or hypothecate, grant any option for
the purpose of, or
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enter into any hedging, synthetic sale or similar transaction with the same
economic effect as a sale of, this Warrant or any of the Holder's rights under
it, except (i) to a corporation controlling, controlled by or under common
control with the Holder (which shall take this Warrant subject to the transfer
restrictions in this paragraph) or (ii) by merger or consolidation of Holder
with or into another corporation or entity if the Holder is not the surviving
corporation (which shall take this Warrant subject to the transfer restrictions
in this paragraph), and any transfer or attempted transfer or other prohibited
assignment of this Warrant will be null and void and of no force or effect.
12. Any notices or other communications to the holder of this
Warrant will be addressed to TRW Inc., Space & Electronics Group, One Space
Park, Redondo Beach, California 90278, Attention: Vice President, Finance, with
a copy to TRW Inc., 1900 Richmond Road, Cleveland, Ohio 44124, Attention:
Secretary, or to such other address as the Holder may specify in writing to the
Company.
13. This Warrant will be governed by, and construed under, the
laws of the State of North Carolina.
14. This Warrant may not be modified without the written
consent of the Company and the Holder.
Dated: November 15, 1999 RF MICRO DEVICES, INC.
By: /s/ William A. Priddy
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NOTICE OF EXERCISE
By this Notice, TRW Inc. exercises the Warrant to which this
Notice is attached with respect to _______________ shares of the Common Stock of
RF Micro Devices, Inc.
TRW Inc. represents to RF Micro Devices, Inc. that TRW Inc.
will be acquiring the securities which are being purchased by exercise of the
Warrant for investment, and not with a view to their resale or distribution.
[Cross out the preceding paragraph if the resale of the shares
being issued on exercise of this Warrant has been registered under the
Securities Act of 1933, as amended.]
TRW INC.
Dated: ____________________ By: __________________________
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