As filed with the Securities and Exchange Commission on July 18, 2000
Registration No. 333-36970
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
-------------------------------
POST-EFFECTIVE AMENDMENT NO. 1 ON
FORM S-3
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
A V N E T, I N C.
(Exact name of registrant as specified in its charter)
New York 11-1890605
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
David R. Birk, Esq.
2211 South 47th Street Senior Vice President and General Counsel
Phoenix, Arizona 85034 Avnet, Inc.
(480) 643-2000 2211 South 47th Street
(Address, including zip code, Phoenix, Arizona 85034
and telephone number, including (480) 643-2000
area code, of registrant's (Name, address, including zip code, and
principal executive offices) telephone number, including area
code, of agent for service)
Copy to:
Andris J. Vizbaras, Esq.
Carter, Ledyard & Milburn
2 Wall Street
New York, New York 10005-2072
Approximate date of commencement of proposed sale to the public: From time
to time after this amendment is declared effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If the delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of each maximum maximum
class of offering aggregate Amount of
securities to Amount to be price per offering registration
be registered registered(1) unit price fee
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Common Stock,
$1.00 par value.............. 2,246,228(2) (3) $155,915,417(4) $41,163(5)
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(footnotes on next page)
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(1) This Registration Statement is hereby amended to reduce the registered
number of shares of the Registrant's common stock from 3,151,524 to
2,246,228. Accordingly, the Registrant is hereby removing from registration
905,296 shares of common stock.
(2) Comprised of up to 1,858,042 shares of the Registrant's common stock issued
in connection with the Registrant's acquisition by merger (the "Merger") of
Savoir Technology Group, Inc. ("Savoir"), up to 155,928 shares of the
Registrant's common stock issuable after the Merger upon the exercise of
warrants issued prior to the Merger to purchase the common stock of Savoir,
and up to 232,258 shares of the Registrant's common stock issuable after
the Merger upon the exercise of options issued prior to the Merger to
purchase the common stock of Savoir.
(3) The proposed maximum offering price per unit was originally calculated as
$52.2379 for each of 2,672,000 shares of the Registrant's common stock
estimated to be the maximum issuable in the Merger with respect to Savoir
common stock, and $34.0662 for each of 479,524 shares of the Registrant's
common stock estimated to be the maximum issuable with respect to Savoir
series A preferred stock.
(4) Pursuant to Rule 457(f)(1) and (f)(2) under the Securities Act of 1933, the
proposed maximum aggregate offering price was computed as the sum of (a)
the product of 17,245,382 (the maximum number of shares of Savoir common
stock originally estimated to be convertible in the Merger, including
shares to be issued upon the exercise of warrants and options to purchase
Savoir common stock) multiplied by $8.09375 (the average of the high and
low prices of a share of Savoir common stock as quoted on the Nasdaq
National Stock Market on May 10, 2000, two business days prior to the first
filing date of this Registration Statement), plus (b) the product of
1,850,012 (the number of shares of Savoir series A preferred stock
outstanding at the first filling date of this Registration Statement)
multiplied by $8.83 (the book value of a share of Savoir series A preferred
stock on March 31, 2000).
(5) This fee was paid by the Registrant on or before May 12, 2000, the first
filing date of this Registration Statement, to register 3,151,524 shares of
the Registrant's Common Stock. No additional fee is payable with this
Post-Effective Amendment.
------------
This Post-Effective Amendment shall become effective on such date as the
Commission, acting pursuant to Section 8(c) of the Securities Act of 1933, may
determine.
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PROSPECTUS
AVNET, INC.
388,186 SHARES OF COMMON STOCK
Avnet, Inc. is offering to sell up to 388,186 shares of its common stock,
as follows:
(i) up to 232,258 shares which Avnet may issue upon the exercise of options
which were granted under the Incentive and Non-Incentive Stock Option Plan
and the 1994 Stock Option Plan of Savoir Technology Group, Inc., and which
Avnet assumed in connection with its acquisition of Savoir; and
(ii) up to 155,928 shares which Avnet may issue upon the exercise of warrants
which were issued by Savoir and which have converted into warrants to
purchase Avnet common stock in connection with Avnet's acquisition of
Savior.
Avnet acquired Savoir by merger on July 3, 2000. As a result of the merger,
Savoir became a wholly-owned subsidiary of Avnet.
Avnet's common stock is listed on the New York Stock Exchange and the
Pacific Exchange (symbol: AVT). On July 17, 2000, the last reported sale price
of a share of our common stock for New York Stock Exchange composite
transactions was $70 3/16. On June 30, 2000, 45,378,727 shares of our common
stock were issued and outstanding, including 1,198,179 treasury shares. Since
that date, Avnet has issued approximately 1.9 million additional shares of its
common stock to former holders of Savoir's common stock and series A preferred
stock as a result of the merger.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is July 18, 2000.
TABLE OF CONTENTS
Page
No.
---
USE OF PROCEEDS...............................................................2
MARKET PRICES OF COMMON STOCK AND DIVIDENDS...................................2
THE OPTIONS...................................................................3
THE WARRANTS..................................................................5
Units Placement Warrants.............................................5
IBM Credit Corporation Warrants......................................5
Moshe Levy Warrants..................................................6
FEDERAL INCOME TAX CONSIDERATIONS.............................................6
The Options..........................................................6
The Warrants.........................................................9
DESCRIPTION OF COMMON STOCK..................................................10
Board of Directors..................................................10
Power to Call Special Shareholder Meetings..........................11
Actions by Written Consent of Shareholders..........................11
Dividends and Repurchases of Shares.................................11
Approval of Certain Business Combinations and Reorganizations.......12
Business Combinations Following a Change of Control ................12
Dissenters' Appraisal Rights........................................12
LEGAL MATTERS................................................................13
EXPERTS......................................................................13
WHERE YOU CAN FIND MORE INFORMATION..........................................14
USE OF PROCEEDS
We intend to use the net proceeds from the sale of the shares covered by
this prospectus for Avnet's general corporate purposes, which may include
repayment of debt, capital expenditures, acquisitions, repurchases of Avnet's
common stock, and working capital. Pending these uses, the net proceeds may also
be temporarily invested in short-term securities.
MARKET PRICES OF COMMON STOCK AND DIVIDENDS
The principal market on which Avnet's common stock is traded is the New
York Stock Exchange under the symbol "AVT." The common stock also is listed on
the Pacific Exchange. The following table presents the high and low sales prices
of a share of Avnet's common stock during the calendar quarters indicated, as
reported for New York Stock Exchange composite transactions:
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High Low
---- ---
1998
----
First quarter ................................$66 1/4 $57
Second quarter ............................... 64 5/16 53 11/16
Third quarter................................. 58 1/2 35 1/4
Fourth quarter................................ 60 5/8 34 15/16
1999
----
First quarter ................................60 15/16 35 5/8
Second quarter ...............................51 34
Third quarter.................................52 7/16 41 1/16
Fourth quarter................................60 1/2 37 5/16
2000
----
First quarter ................................73 1/2 50
Second quarter................................81 1/8 56
Third quarter (through July 17)...............70 13/16 56 5/16
See the cover page of this prospectus for a recent sale price of Avnet's
common stock.
We paid a cash dividend of 15 cents per share on our common stock during
each calendar quarter in 1998, 1999 and the three calendar quarters of 2000. We
cannot give you any assurances about the frequency and amount of our future
dividends.
THE OPTIONS
At the effective time of our acquisition of Savoir by merger, each option
to purchase shares of Savoir's common stock under its Incentive and
Non-Incentive Stock Option Plan and its 1994 Stock Option Plan became an option
to purchase shares of our common stock. The exercise price of each such option
is now equal to the exercise price of the option per share of Savoir common
stock before the merger divided by 0.11452, the exchange ratio for the
conversion of Savoir common stock into Avnet common stock in the merger, with
such exercise price rounded up to the nearest penny, and the number of our
shares issuable upon exercise of each such option is equal to the number of
shares of Savoir common stock that could have been acquired under the option
before the merger multiplied by 0.11452, with such share number rounded down to
the nearest whole number. As a result of the merger, Savoir options were
converted into options to purchase an aggregate of 232,258 shares of our common
stock, at prices ranging from $29.47 to $113.52 per share.
The substantive terms and conditions of each option after the merger are
substantially the same as the terms and conditions of the option before the
merger. For example, each option has the
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same vesting schedule and expiration date as it had before the merger.
The Savoir plans will be limited to their current participants, and Avnet
will not issue additional options under the plans. Options granted to
non-employee directors of Savoir under the 1994 Stock Option Plan have ten year
terms and became fully vested upon the merger.
The plans are administered by the Executive Incentive and Compensation
Committee of Avnet's board of directors. The committee may delegate certain of
its responsibilities to other persons. The board of directors may fill vacancies
on the committee and may from time to time remove or add members, and may also
administer the plans. The committee may periodically adopt rules and regulations
for carrying out the plan. The board of directors may amend the plans, as
desired, without further action by Avnet's shareholders except as required by
applicable law.
Options under the plans consist of nonstatutory stock options and incentive
stock options within the meaning of the Internal Revenue Code. The purchase
price under each option was established by the Savoir's stock option committee,
but for ISOs under both plans, and non-employee director options under the 1994
Stock Option Plan, the purchase price was at least one hundred percent of the
fair market value of Savoir common stock on the date of grant.
The option price must be paid in full at the time of exercise. Options
under the Incentive and Non-Incentive Stock Option Plan may be exercised by the
payment of cash only. The exercise price of an option under the 1994 Stock
Option Plan may be paid in cash or, if the option so provides, by delivery of an
irrevocable direction to a securities broker to sell shares and to deliver part
of the sale proceeds to Avnet, or by the surrender to Avnet of shares of Avnet
common stock owned by the person exercising the option and having a fair market
value on the date of exercise equal to the option price, or by any combination
of the foregoing. Each option expires within a period of not more than ten years
from the grant date. Unless an option otherwise provides, it is transferable
only by will or the laws of descent and distribution and shall only be
exercisable by the participant during his or her lifetime. The committee may
modify, extend or renew outstanding options or may accept the cancellation of
outstanding options in return for the grant of new options at the same or a
different price, except the optionee must consent to any modification, extension
or renewal which impairs his or her rights or increases his or her obligations
under such option.
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THE WARRANTS
Units Placement Warrants
Savoir issued warrants to purchase shares of its common stock on September
19, 1997 to investors and placement agents in a private placement of units which
also included shares of its series A preferred stock. The units placement
warrants had an exercise price of $9.6875 per share of Savoir common stock. At
the effective time of the merger, the units placement warrants were converted
into warrants to acquire an aggregate of approximately 139,895 shares of Avnet
common stock at an exercise price of $84.59 per share.
The exercise price of units placement warrants may be paid in cash or by a
cashless exercise. In a cashless exercise, the holder will receive the number of
shares of Avnet common stock calculated by the following formula:
X = Y(A-B)
----------
A
where "X" equals the number of shares of Avnet common stock to be issued to the
holder, "Y" equals the number of shares of Avnet common stock otherwise
purchasable under the warrant, "A" equals the current market price of Avnet
common stock and "B" equals the exercise price of the warrant. The units
placement warrants expire on the fifth anniversary of the date of their
issuance.
IBM Credit Corporation Warrants
Savoir issued to IBM Credit Corporation, on September 30, 1997, warrants to
purchase 100,000 shares of Savoir common stock. The exercise price of the
warrants initially was $7.50 per share of Savoir common stock, and was reset by
the terms of the warrant in September 1998 to $4.76875 per share of Savoir
common stock. At the effective time of the merger, the Savoir warrants held by
IBM Credit Corporation were converted into warrants to acquire 11,452 shares of
Avnet common stock at an exercise price of $41.65 per share.
Payment of the exercise price of the IBM Credit Corporation warrants may be
made at the option of the holder by cash, by instructing Avnet to withhold a
number of shares then issuable upon exercise of the particular warrant having an
aggregate fair market value equal to such exercise price, or by surrendering
shares of Avnet common stock previously acquired by the holder with an aggregate
fair market value equal to such exercise price, or any combination of foregoing.
The warrants issued to IBM Credit Corporation expire on September 30, 2004.
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Moshe Levy Warrants
Savoir issued to Moshe Levy in January 2000 warrants to purchase 40,000
shares of Savoir common stock at an exercise price of $5.00 per share. At the
effective time of the merger, these warrants were converted into warrants to
acquire 4,581 shares of Avnet common stock at an exercise price of $43.66 per
share.
The warrants issued to Mr. Levy expire on September 18, 2002 and may be
exercised with cash or by a cashless exercise. In a cashless exercise, the
holder will receive the number of shares of Avnet common stock calculated in the
manner described above in "--Units Placement Warrants".
FEDERAL INCOME TAX CONSIDERATIONS
In the opinion of Carter, Ledyard & Milburn, counsel to the Company, the
following is a summary of the material United States federal income tax
considerations relating to the options and the warrants covered by this
prospectus. This summary is not a complete description of such considerations,
and each optionee or warrantholder is advised to consult his or her own tax
adviser before exercising an option or a warrant, or disposing of shares
acquired pursuant to the exercise of an option or warrant.
The Options
The conversion of options to purchase shares of Savoir common stock into
options to purchase our shares was not a taxable event for United States federal
income tax purposes.
Each option is either an incentive stock option within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (an "Incentive
Option"), or an option which does not qualify as an Incentive Option (a
"Nonqualified Option"). Different tax consequences attach to these two types of
options.
Nonqualified Options
Upon exercise of a Nonqualified Option for cash, the optionee recognizes
ordinary income in an amount equal to the excess, if any, of the fair market
value, on the date of exercise, of the shares purchased over their exercise
price. If an optionee pays the option exercise price by delivering shares of
Avnet common stock already owned by such optionee, such delivery would
constitute a non-taxable exchange by the optionee, and the optionee would
recognize ordinary income in an amount equal to the fair market value of the
additional shares received (i.e., above the number of shares delivered).
Optionees are especially urged to consult their own tax advisers before paying
the exercise price of an option by delivering shares of Avnet common stock
already owned.
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Since all holders of currently outstanding options were employees or
directors of Savoir or a subsidiary at the time the options were granted, any
ordinary income recognized upon exercise of a Nonqualified Option will be
classified as taxable wages subject to federal and state income tax withholding
and employment tax withholding, which withholding taxes will be due and payable
at the time the option is exercised. At Avnet's request, upon exercise of a
Nonqualified Option, the optionee will be required to pay to Avnet an amount
equal to 28% of such ordinary income for federal income tax withholding purposes
and, where applicable, an appropriate percentage for employment tax and state
and local income tax withholding purposes, to cover the amount of employment and
income tax withholding which Avnet is required to pay.
Avnet will be entitled to an income tax deduction in the same amount that,
and for Avnet's taxable year in which, the optionee recognizes ordinary income
from the exercise of a Nonqualified Option.
Upon a sale of shares purchased on the exercise of a Nonqualified Option,
the optionee will recognize short-term or long-term capital gain or loss,
depending on whether the shares are held for more than one year after the date
of exercise. Such gain or loss will be measured by the difference between the
selling price of the shares and the fair market value of the shares on the date
of exercise.
Incentive Options
In general, the holder of an Incentive Option does not recognize any income
at the time the option is exercised (although the exercise of an Incentive
Option can have "alternative minimum tax" consequences to the optionee as
described below under the caption " -- Alternative Minimum Tax"). If an optionee
holds shares purchased upon exercise of an Incentive Option for at least (a) two
years after the date the related Savoir option was granted to the optionee and
(b) one year after the date such shares are transferred to the optionee, then
any gain or loss in respect of a subsequent disposition of such shares will
generally be treated as a long-term capital gain or loss. In the event that the
optionee disposes of shares purchased upon exercise of an Incentive Option (for
this purpose a disposition includes a sale, exchange, gift or certain other
transfers of legal title but not a mere pledge) before the end of such two- and
one-year periods (any such disposition being herein referred to as a
"disqualifying disposition"), then the excess, if any, of the aggregate fair
market value of such shares on the date on which the option was exercised over
the aggregate exercise price of such shares will be treated as ordinary income
to the optionee in the year of the disqualifying disposition, unless such
disqualifying disposition is a sale or exchange for less than the fair market
value of such shares on the date of exercise of the option, in which case the
amount that will be so treated as ordinary income will be limited to the excess,
if any, of the aggregate amount realized upon such sale or exchange over the
aggregate exercise price of the shares so sold or exchanged.
In the event that a disqualifying disposition of shares is a sale or
exchange for more than the fair market value of such shares on the date of
exercise of the Incentive Option, the excess of the aggregate amount realized
upon such sale or exchange over the aggregate fair market value of such
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shares on the date of exercise will be treated as a capital gain. Such gain will
be treated as long-term capital gain if the shares have been held for more than
one year at the time of the disqualifying disposition and otherwise will be
treated as short-term capital gain. In the event that a disqualifying
disposition is a sale or exchange for less than the aggregate exercise price of
such shares, no ordinary income will be realized by the optionee, and the
difference between the aggregate amount realized upon such sale or exchange and
such aggregate exercise price will be treated as a long-term or short-term
capital loss, depending upon whether such shares have or have not been held for
more than one year at the time of such sale or exchange.
The rules described above relating to disqualifying dispositions may not
apply to certain transfers -- for example, transfers by bequest or incident to
divorce.
Avnet will not be entitled to any federal income tax deduction with respect
to the exercise of an Incentive Option, but may be entitled, in the year of a
disqualifying disposition, to a deduction equal to the amount, if any, that the
optionee must treat as ordinary income. At Avnet's request, upon exercise of an
Incentive Option or upon a disqualifying disposition, the optionee will be
required to pay to Avnet an appropriate percentage for any required employment
tax or federal, state or local income tax withholding.
If an optionee pays the option exercise price by delivering shares of Avnet
common stock already owned by such optionee, such delivery would constitute a
non-taxable exchange by the optionee and would not affect the Incentive Option
status of the shares purchased upon exercise of the option. However, if the
shares delivered in payment had previously been acquired upon exercise of an
Incentive Option and were not subsequently held for the requisite one- and
two-year periods, the delivery of such shares in payment of the exercise price
of an option would constitute a disqualifying disposition of the shares so
delivered. Optionees are especially urged to consult their own tax advisers
before paying the exercise price of an Incentive Option by delivering shares of
common stock already owned.
In the event an optionee exercises an Incentive Option more than three
months (one year if the optionee is disabled) after employment with Avnet
terminates, the tax treatment with respect to the option is the same as for a
Nonqualified Option (discussed above).
-8-
Alternative Minimum Tax
The Internal Revenue Code imposes an alternative minimum tax determined by
applying a special tax rate to the excess, if any, of an individual's
"alternative minimum taxable income" over a specified exemption amount.
Alternative minimum taxable income includes the amount by which the fair market
value of shares acquired through exercise of an Incentive Option exceeds the
exercise price. In addition, the basis of any shares so acquired for determining
gain or loss for purposes of the alternative minimum tax will be the shares'
fair market value at exercise. In the event of a disqualifying disposition of
the shares in the year the Incentive Option is exercised, the amount includible
as alternative minimum taxable income is limited to the excess of the sales
price over the exercise price.
The Warrants
The conversion of Savoir warrants into Avnet warrants was not a taxable
event for United States federal income tax purposes. A Savoir warrant holder's
aggregate tax basis and holding period carried over to the Avnet warrants. The
tax considerations associated with warrants will generally be as described
below.
Avnet will recognize no gain or loss upon the lapse, reacquisition or
exercise of a warrant. On the other hand, the warrant holder (assuming the
underlying shares would be a capital asset in the warrant holder's hands) will
recognize a capital loss upon the lapse of the warrant equal to the holder's
basis in the warrant, and will recognize capital gain or loss upon the sale of
the warrant to Avnet or a third party equal to the sales proceeds less the
holder's basis in the warrant. Such capital gain or loss will be long-term
capital gain or loss if the warrant was held for more than one year.
If a warrant holder pays the warrant exercise price with cash, the exercise
will not be a taxable event for the warrant holder, the tax basis for the
warrant will be added to the exercise price paid for the stock in determining
the holder's basis in the shares received, and the holding period for the shares
will begin upon acquisition of the stock, not the warrant. Upon a subsequent
sale of the shares, the holder will recognize capital gain or loss (assuming the
shares are capital assets in the holder's hands) equal to the excess of the
sales price of the stock over the holder's basis in the shares. Such capital
gain or loss will be long-term capital gain or loss if the shares were held for
more than one year. The foregoing discussion would not apply to a warrant holder
who pays the exercise price other than with cash, and warrant holders are
especially urged to consult their own tax advisors before paying the exercise
price of a warrant other than with cash.
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DESCRIPTION OF COMMON STOCK
Avnet is authorized to issue 120,000,000 shares of its common stock. At the
close of business on June 30, 2000, we had outstanding 45,378,727 shares of
common stock, including 1,198,179 treasury shares. Since that date, we have
issued approximately 1.9 million additional shares of our common stock to former
holders of Savoir's common stock and series A preferred stock as a result of our
acquisition of Savoir. All outstanding shares of our common stock are fully paid
and nonassessable.
The holders of shares of Avnet's common stock have equal rights to
dividends from funds legally available for the payment of dividends when, as and
if declared by Avnet's board of directors, and are entitled, upon liquidation,
to share ratably in any distribution in which holders of common stock
participate. The common stock is not redeemable, has no preemptive or conversion
rights and is not liable for assessments or further calls. The holders of shares
of Avnet's common stock are entitled to one vote for each share at all meetings
of shareholders.
The transfer agent and registrar for Avnet's common stock is Norwest Bank
Minnesota, N.A. Avnet's common stock is listed on the New York Stock Exchange
and the Pacific Exchange.
Under its certificate of incorporation, Avnet is authorized to issue up to
3,000,000 shares of preferred stock, in series. For each series of preferred
stock, Avnet's board of directors may fix the relative rights, preferences and
limitations as between the shares of such series, the shares of other series of
Avnet preferred stock, and the shares of Avnet common stock. No shares of Avnet
preferred stock are outstanding.
Board of Directors
Although New York law permits the certificate incorporation of a New York
corporation to provide for cumulative voting in the election of directors,
Avnet's certificate of incorporation does not so provide.
New York law permits the certificate of incorporation or by-laws of a New
York corporation to divide its directors into as many as four classes with
staggered terms of office. However, Avnet's certificate and by-laws do not so
provide for a classified board of directors. Therefore, all of its directors are
elected annually for one-year terms.
Under New York law, shareholders may remove any or all directors for cause.
New York law also allows directors to be removed without cause if provided in
the certificate of incorporation. The Avnet certificate of incorporation
authorizes any or all of the directors to be removed with or without cause at
any time by the vote of the holders of a majority of the shares of Avnet and
provides that the terms of the removed directors shall forthwith terminate.
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New York law provides that newly created directorships resulting from an
increase in the number of directors and vacancies arising for any reason may be
filled by vote of the board of directors, whether or not constituting a quorum,
except that:
o vacancies resulting from the removal of directors without cause may be
filled only by a vote of the shareholders, unless the certificate of
incorporation or a specific provision of a by-law adopted by the
shareholders provides that such a vacancy may be filled by a vote of
the board of directors; and
o the certificate of incorporation or by-laws may provide that all newly
created directorships and vacancies may be filled only by a vote of
the shareholders.
The Avnet by-laws provide that any vacancy created by the removal of a
director by the shareholders with or without cause may be filled only by a vote
of the shareholders, and that any vacancy created for any other reason may be
filled by a vote of the board of directors or the shareholders.
Power to Call Special Shareholders' Meetings
Under New York law, a special meeting of shareholders may be called by the
board of directors and by such person or persons as may be authorized to do so
in the certificate of incorporation or by-laws. In addition, if an annual
shareholders' meeting has not been held for a certain period of time and a
sufficient number of directors were not elected to conduct the business of the
corporation, the board must call a special meeting for the election of
directors. If the board fails to do so, or sufficient directors are not elected
within a certain period of time, holders of 10% of the votes of the shares
entitled to vote in an election of directors may call a special meeting for such
an election.
Actions by Written Consent of Shareholders
New York law provides that any action which may be taken by shareholders by
vote may be taken without a meeting by written consent, signed by holders of all
outstanding shares entitled to vote, or if authorized by the certificate of
incorporation, by holders of the minimum number of shares necessary to authorize
the action at a meeting of shareholders at which all shares entitled to vote are
present and voted. The Avnet certificate of incorporation does not authorize
shareholders to act by less than unanimous written consent.
Dividends and Repurchases of Shares
Under New York law, dividends may be declared or paid and other
distributions may be made out of surplus only, so that the net assets of the
corporation remaining after a dividend or distribution must at least equal the
amount of the corporation's stated capital. A corporation may
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declare and pay dividends or make other distributions except when the
corporation is currently insolvent or would thereby be made insolvent or when
the declaration, payment or distribution would be contrary to any restrictions
contained in its certificate of incorporation.
Approval of Certain Business Combinations and Reorganizations
Under New York law, two-thirds of the votes of all outstanding shares
entitled to vote thereon are required to approve mergers, consolidations, share
exchanges or sales, leases or other dispositions of all or substantially all the
assets of a corporation if not made in the usual or regular course of business.
New York law was amended in 1998 to permit a New York corporation then in
existence to reduce the required vote to a majority of the outstanding shares,
but Avnet has not done so.
Business Combination Following a Change in Control
New York law prohibits any business combination (defined to include a
variety of transactions, including mergers, consolidations, sales or
dispositions of assets, issuances of stock, liquidations, reclassifications and
the receipt of certain benefits from the corporation, including loans or
guarantees) with, involving or proposed by any interested shareholder (defined
generally as any person that beneficially owns, directly or indirectly, 20% or
more of the outstanding voting stock of a New York corporation or any person
that is an affiliate or associate of a New York corporation and at any time
within the past five years was a beneficial owner of 20% or more of the
outstanding voting stock) for a period of five years after the date on which the
interested shareholder first became an interested shareholder, unless the
transaction is approved by the board of directors prior to the date on which the
interested shareholder became an interested shareholder. After this five-year
period, a business combination between a New York corporation and the interested
shareholder is prohibited unless either certain "fair price" provisions are
complied with or the business combination is approved by a majority of the
outstanding voting stock not beneficially owned by the interested shareholder.
Under New York law, corporations may elect not to be governed by the statute
described above, but Avnet's certificate of incorporation does not contain such
an election.
Dissenters' Appraisal Rights
Under New York law, any shareholder of a corporation has the right to
obtain payment for the fair value of the shareholder's shares in the event of
o certain amendments or changes to the certificate of incorporation adversely
affecting the rights of the shareholder,
o certain mergers or consolidation of the corporation if the shareholder is
entitled to vote thereon,
-12-
o a merger or consolidation where the shareholder is not entitled to vote or
if the shareholder's shares will be canceled or exchanged for cash or other
consideration other than shares of the surviving or consolidated
corporation or another corporation,
o certain sales, leases, exchanges or other dispositions of all or
substantially all of the assets of the corporation which require
shareholder approval other than a transaction solely for cash, and
o certain share exchanges.
However, no appraisal rights will be available in a merger to a shareholder of
the surviving corporation whose rights are not adversely affected or whose
shares were, at the record date to vote on the plan of merger, either listed on
a national securities exchange or designated as a national market system
security on an interdealer quotation system by the National Association of
Securities Dealers, Inc.
LEGAL MATTERS
The validity of the shares offered hereby was passed upon for Avnet by
David R. Birk, its Senior Vice President and General Counsel. Mr. Birk
beneficially owns 43,284 shares of Avnet's common stock, which includes 40,625
shares issuable upon exercise of employee stock options.
EXPERTS
The consolidated financial statements and schedule of Avnet incorporated by
reference in this prospectus from Avnet's Annual Report on Form 10-K as of July
2, 1999 and June 26, 1998 and for the three years in the period ended July 2,
1999 have been audited by Arthur Andersen LLP, independent public accountants,
as indicated in their report with respect thereto, and are incorporated herein
by reference in reliance upon the authority of that firm as experts in giving
such report.
The consolidated financial statements of Marshall Industries incorporated
by reference in this prospectus from Avnet's Current Report on Form 8-K bearing
cover date of October 20, 1999, for the fiscal years ended May 31, 1999, 1998
and 1997 have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their report with respect thereto, and are
incorporated herein by reference in reliance upon the authority of that firm as
experts in giving such report.
-13-
WHERE YOU CAN FIND MORE INFORMATION
This prospectus is part of a post-effective amendment on Form S-3 to a
registration statement on Form S-4 (Registration No. 333-36970) filed by Avnet
with the Securities and Exchange Commission under the Securities Act of 1933, as
amended. Reference is hereby made to the registration statement, as so amended,
and the exhibits thereto for further information with respect to Avnet and the
shares offered hereby.
Avnet files annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission (Commission File
Number 1-4224). These filings contain important information which does not
appear in this prospectus. For further information about Avnet, you may obtain
these filings over the internet at the SEC's web site at http://www.sec.gov. You
may also read and copy these filings at the SEC's public reference room at 450
Fifth Street, N.W., Washington, D.C. 20549. You may obtain information on the
operation of the public reference room by calling the SEC at 1-800-SEC-0330, and
may obtain copies of Avnet's filings from the public reference room by calling
(202) 942-8090.
The SEC allows Avnet to "incorporate by reference" information into this
prospectus, which means that we can disclose important information to you by
referring you to other documents which Avnet has filed or will file with the
SEC. We are incorporating by reference in this prospectus
o Avnet's Annual Report on Form 10-K for the fiscal year ended July 2, 1999,
o Avnet's Quarterly Reports on Form 10-Q for the quarterly periods ended
October 1, 1999, December 31, 1999, and March 31, 2000,
o Avnet's Current Reports on Form 8-K bearing cover dates of September 28,
1999, October 20, 1999, December 22, 1999, January 26, 2000, February 8,
2000, April 25, 2000 and July 11, 2000, and
o The description of Avnet's common stock which appears in Avnet's
Registration Statement for the registration of the common stock under
Section 12(b) of the Securities Exchange Act of 1934, including any
amendment or report filed to update this description.
All documents which Avnet has filed or will file with the SEC pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act after the
reports listed above and before the termination of this offering of Avnet's
securities will be deemed to be incorporated by reference in this prospectus and
to be a part of it from the filing dates of such documents. Certain statements
in and portions of this prospectus update and replace information in the above
listed documents incorporated by reference. Likewise, statements in or portions
of a future document incorporated by reference in this prospectus may update and
replace statements in and portions of this prospectus or the above listed
documents.
-14-
We shall provide you without charge, upon your written or oral request, a
copy of the Savior Incentive and Non-Incentive Stock Option Plan, the Savoir
1994 Stock Option Plan, and any warrant agreement or other agreement relating to
the shares of Avnet common stock offered in this prospectus, and any of the
documents incorporated by reference in this prospectus, other than exhibits to
such documents which are not specifically incorporated by reference into such
documents. Please direct your written or telephone requests to the Corporate
Secretary, Avnet, Inc., 2211 South 47th Street, Phoenix, Arizona 85034
(Telephone 480-643-2000).
-15-
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The expenses of the issuance and distribution of the securities which are
the subject of the prospectus in this Post-Effective Amendment are estimated as
follows:
Registration fee................................. $ 5,354*
Legal fees and expenses.......................... 12,000
Accountants' fees and expenses................... 5,000
Miscellaneous.................................... 2,646
------
Total............................................ $ 25,000
======
----------
* Consists only of that portion of the registration fee attributable to the
388,186 shares of the Registrant's Common Stock covered by the prospectus
in this Post-Effective Amendment.
Item 15. Indemnification of Directors and Officers.
Section 54 of the registrant's By-laws provides as follows:
"Indemnification"
"A. The Corporation shall indemnify, and advance the expenses of,
any director, officer or employee to the full extent permitted by the
New York Business Corporation Law as the same now exists or may
hereafter be amended.
"B. The indemnification and advancement of expenses granted
pursuant to this Section 54 shall not be exclusive or limiting of any
other rights to which any person seeking indemnification or
advancement of expenses may be entitled when authorized by (i) a
resolution or shareholders, (ii) a resolution of directors or (iii) an
agreement providing for such indemnification; provided that no
indemnification may be made to or on behalf of any such person if a
judgment or other final adjudication adverse to such person
establishes that his acts were committed in bad faith or were the
result of active and deliberate dishonesty
II-1
and were material to the cause of action so adjudicated, or that he
personally gained in fact a financial profit or other advantage to
which he was not legally entitled.
"C. No amendment, modification or rescission of these By-laws
shall be effective to limit any person's right to indemnification with
respect to any alleged cause of action that accrues or other incident
or matter that occurs prior to the date on which such modification,
amendment or rescission is adopted."
Section 721 of the New York Business Corporation Law (the "B.C.L.")
provides that no indemnification may be made to or on behalf of any director or
officer of the Registrant if "a judgment or other final adjudication adverse to
the director or officer establishes that his acts were committed in bad faith or
were the result of active and deliberate dishonesty and were material to the
cause of action so adjudicated, or that he personally gained in fact a financial
profit or other advantage to which he was not legally entitled." Section 54B of
the Registrant's By-laws includes the foregoing statutory language.
The rights granted under Section 54 of the By-laws are in addition to, and
are not exclusive of, any other rights to indemnification and expenses to which
any director or officer may otherwise be entitled. Under the B.C.L., a New York
corporation may indemnify any director or officer who is made or threatened to
be made a party to an action by or in the right of such corporation against
"amounts paid in settlement and reasonable expenses, including attorneys' fees,"
actually and necessarily incurred by him in connection with the defense or
settlement of such action, or in connection with an appeal therein, if such
director or officer acted, in good faith, for a purpose which he reasonably
believed to be in the best interests of the corporation, except that no
indemnification shall be made in respect of (1) a threatened action, or a
pending action which is settled or otherwise disposed of, or (2) any claim,
issue or matter as to which such director or officer shall have been adjudged
liable to the corporation, unless and only to the extent that a court determines
that the director or officer is fairly and reasonably entitled to indemnity
(B.C.L. Section 722(c)). A corporation may also indemnify directors and officers
who are parties to other actions or proceedings (including actions or
proceedings by or in the right of any other corporation or other enterprise
which the director or officer served at the request of the corporation) against
"judgments, fines, amounts paid in settlement and reasonable expenses, including
attorneys' fees," actually or necessarily incurred as a result of such actions
or proceedings, or any appeal therein, provided the director or officer acted,
in good faith, for a purpose which he reasonably believed to be in the best
interests of the corporation (or in the case of service to another corporation
or other enterprise at the request of such corporation, not opposed to the best
interests of such corporation) and, in criminal cases, that he also had no
reasonable cause to believe that his conduct was unlawful (B.C.L. Section
722(a)). Any indemnification under Section 722 may be made only if authorized in
the specific case by disinterested directors, or by the board of directors upon
the opinion in writing of independent legal counsel that indemnification is
proper, or by the shareholders (B.C.L. Section 723(b)), but even without such
authorization, a court may order indemnification in certain circumstances
(B.C.L. Section 724). Further, any director or officer who is "successful, on
the merits or otherwise," in the
II-2
defense of an action or proceeding is entitled to indemnification as a matter of
right (B.C.L. Section 723(a)).
A New York corporation may generally purchase insurance, consistent with
the limitations of New York insurance law and regulatory supervision, to
indemnify the corporation for any obligation which it incurs as a result of the
indemnification of directors and officers under the provisions of the B.C.L., so
long as no final adjudication has established that the directors' or officers'
acts of active and deliberate dishonesty were material to the cause of action so
adjudicated or that the directors or officers personally gained in fact a
financial profit or other advantage (B.C.L. Section 726).
The registrant's directors and officers are currently covered as insureds
under directors' and officers' liability insurance. Such insurance is subject to
renewal in August 2000 and provides an aggregate maximum of $50,000,000 of
coverage for directors and officers of the Registrant and its subsidiaries
against claims made during the policy period relating to certain civil
liabilities, including liabilities under the Securities Act of 1933 (the
"Securities Act").
Item 16. Exhibits
The index to exhibits appears immediately following the signature pages of
this Amendment.
Item 17. Undertakings.
The undersigned Registrant hereby undertakes as follows:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement (Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the change in
volume represents no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement); and
II-3
(iii)To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or
any material change to such information in this Registration
Statement;
provided, however, that paragraphs (i) and (ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Company pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act") that are incorporated by reference in this Registration
Statement.
(2) For the purpose of determining any liability under the Securities Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) For purposes of determining any liability under the Securities Act,
each filing of the Company's annual report pursuant to Section 13(a) or Section
15(d) of the Exchange Act that is incorporated by reference in this Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered herein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions referred to in Item 15, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is therefore unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment to be
signed on its behalf by the undersigned, thereunto duly authorized, in the city
of Phoenix, State of Arizona, on the 18th day of July, 2000.
AVNET, INC.
By: /s/Raymond Sadowski
-------------------
Raymond Sadowski
Senior Vice President and
Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
has been signed on July 18, 2000, by the following persons in the capacities
indicated:
Signature Title
--------- -----
* Chairman of the Board, Chief
- ----------------------------- Executive Officer and Director
Roy Vallee
*
- ----------------------------- Director
Eleanor Baum
*
- ----------------------------- Director
J. Veronica Biggins
*
- ----------------------------- Director
Joseph F. Caligiuri
II-5
Signature Title
--------- -----
*
- ----------------------------- Director
Lawrence W. Clarkson
*
- ----------------------------- Director
Ehud Houminer
*
- ----------------------------- Director
James A. Lawrence
*
- ----------------------------- Director
Salvatore J. Nuzzo
*
- ----------------------------- Director
Frederic Salerno
*
- ----------------------------- Director
Frederick S. Wood
/s/Raymond Sadowski
- ----------------------------- Senior Vice President and
Raymond Sadowski Chief Financial Officer
*
- ----------------------------- Controller and
John F. Cole Chief Accounting Officer
- ----------------------
* By: /s/Raymond Sadowski
--------------------
Raymond Sadowski
Attorney-in-Fact
II-6
EXHIBIT INDEX
Exhibit No.
- ----------
4(a) Form of Units Purchase Agreement dated as of September 19, 1997
between the Unit Purchasers and Savoir Technology Group, Inc. (then
known as Western Micro Technology, Inc.), filed as exhibit 4.12 to
Savoir's current report on Form 8-K dated October 10, 1997, and
incorporated herein by this reference.
4(b) Common Stock Purchase Warrant of Savoir dated December 21, 1999.
4(c) Amended and Restated Warrant Agreement dated as of July 3, 2000 among
Avnet, Savoir and IBM Credit Corporation.
4(d) Amended and Restated Incentive and Non-Incentive Stock Option Plan of
Savoir (then known as Western Micro Technology, Inc.), filed as
exhibit 10.1 to Savoir's annual report on Form 10-K for the period
ended December 31, 1990 and incorporated herein by this reference.
4(e) 1994 Stock Option Plan of Savoir (then known as Western Micro
Technology, Inc.), as amended and restated on May 18, 1997, filed as
exhibit A to Savoir's definitive proxy statement filed on June 27,
1997 and incorporated herein by this reference.
5* Opinion of David R. Birk, Senior Vice President and General Counsel of
Avnet.
8 Opinion of Carter, Ledyard & Milburn re tax matters.
23(a) Consent of Carter, Ledyard & Milburn (included in Exhibit 8).
23(b) Consent of Arthur Andersen LLP.
24* Powers of Attorney.
* Previously filed as an exhibit to this Registration Statement.
II-7
THIS WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT FILED UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER SUCH ACT.
SAVOIR TECHNOLOGY GROUP, INC.
COMMON STOCK PURCHASE WARRANT
CSW-110
This certifies that, for good and valuable consideration, receipt of which
is hereby acknowledged, SAVOIR TECHNOLOGY GROUP, INC., a Delaware corporation
(the "Company"), grants to MOSHE LEVY (the "Warrantholder"), the right to
subscribe for and purchase from the Company FORTY THOUSAND (40,000) validly
issued, fully paid and nonassessable shares (the "Warrant Shares") of the
Company's Common Stock, par value $0.01 per share (the "Common Stock"), at the
purchase price per share of $5.00 (the "Exercise Price"), exercisable at any
time and from time to time to and including September 18, 2002 (the "Exercise
Period"), all subject to the terms, conditions and adjustments herein set forth.
1. Duration and Exercise of Warrant; Payment of Taxes; Information.
1.1 Duration and Exercise of Warrant.
(a) Cash Exercise. This Warrant may be exercised by the Warrantholder by
(i) the surrender of this Warrant to the Company, with a duly executed Exercise
Form specifying the number of Warrant Shares to be purchased, during normal
business hours on any Business Day during the Exercise Period and (ii) the
delivery of payment to the Company, for the account of the Company, by cash,
wire transfer of immediately available funds to a bank account specified by the
Company, or by certified or bank cashier's check, of the Exercise Price for the
number of Warrant Shares specified in the Exercise Form in lawful money of the
United States of America. The Company agrees that such Warrant Shares shall be
deemed to be issued to the Warrantholder as the record holder of such Warrant
Shares as of the close of business on the date on which this Warrant shall have
been surrendered and payment made for the Warrant Shares as aforesaid. A stock
certificate or certificates for the Warrant Shares specified in the Exercise
Form shall be delivered to the Warrantholder as promptly as practicable, and in
any event within ten (10) days, thereafter. The stock certificate or
certificates so delivered shall be in denominations of one hundred (100) shares
each or such lesser or greater denominations as may be reasonably specified by
the Warrantholder in the Exercise Form. If this Warrant shall have been
exercised only in part, the Company shall, at the time of delivery of the stock
certificate or certificates, deliver to the Warrantholder a new Warrant
evidencing the rights to purchase the remaining Warrant Shares, which new
Warrant shall in all other respects be identical with this Warrant. No
adjustments shall be made on Warrant Shares issuable on the exercise of this
Warrant for any cash dividends paid or payable to holders of record of Common
Stock prior to the date as of which the Warrantholder shall be deemed to be the
record holder of such Warrant Shares.
(b) Net Issue Exercise. In lieu of exercising this Warrant pursuant to
Section 1.1(a), this Warrant may be exercised by the Warrantholder by the
surrender of this Warrant to the Company, with a duly executed Exercise Form
marked to reflect Net Issue Exercise and specifying the number of Warrant Shares
to be purchased, during normal business hours on any Business Day during the
Exercise Period. The Company agrees that such Warrant Shares shall be deemed to
be issued to the Warrantholder as the record holder of such Warrant Shares as of
the close of business on the date on which this Warrant shall have been
surrendered as aforesaid. Upon such exercise, the Warrantholder shall be
entitled to receive shares equal to the value of this Warrant (or the portion
thereof being cancelled) by surrender of this Warrant to the Company together
with notice of such election in which event the Company shall issue to
Warrantholder a number of shares of the Company's Common Stock computed as of
the date of surrender of this Warrant to the Company using the following
formula:
X = Y(A-B)
------
A
Where:
X = the number of shares of Common Stock to be issued to Warrantholder
under this Section 1.1(b);
Y = the number of shares of Common Stock otherwise purchasable under
this Warrant (at the date of such calculation) or, if only a portion
of this Warrant is being exercised, the number of Warrant Shares being
exercised;
A = the Current Market Price of one share of the Company's Common Stock
(at the date of such calculation); and
B = the Exercise Price (as adjusted to the date of such calculation).
(c) Current Market Price. For purposes of Section 1.1(b), Current Market
Price of one share of the Company's Common Stock shall mean:
(i) the average of the daily closing prices per share of the Company's
Common Stock on the principal national securities exchange or on the Nasdaq
Stock Market's ("Nasdaq") National Market, on which the Common Stock is
listed or admitted to trading, for the five (5) business days before the
day in question, or
(ii) if not listed or traded on any such exchange or market, the
average of the last reported sale price per share on the Nasdaq SmallCap
Market for the five (5) business days before the day in question, or
(iii) if not listed or traded on any such exchange or Nasdaq, the
average of the bid and asked prices per share as reported in the "pink
sheets" published by the National Quotation Bureau, Inc. for the five (5)
business days before the day in question, or
2
(iv) if such quotations are not available, the fair market value per
share of the Company's Common Stock on the date such notice was received by
the Company as reasonably determined by the Board of Directors of the
Company.
1.2 Payment of Taxes. The issuance of certificates for Warrant Shares shall
be made without charge to the Warrantholder for any stock transfer or other
issuance tax in respect thereto; provided, however, that the Warrantholder shall
be required to pay any and all taxes which may be payable in respect of any
transfer involved in the issuance and delivery of any certificate in a name
other than that of the then Warrantholder as reflected upon the books of the
Company.
1.3 Information. Upon receipt of a written request from the Warrantholder,
the Company agrees to deliver promptly to such Warrantholder a copy of its
current publicly available financial statements and to provide such other
publicly available information concerning the business and operations of the
Company as such Warrantholder may reasonably request in order to assist the
Warrantholder in evaluating the merits and risks of exercising the Warrant and
to make an informed investment decision in connection with such exercise.
2. Restrictions on Transfer; Restrictive Legends.
2.1 Restrictions on Transfer; Compliance with Securities Laws. This Warrant
and the Warrant Shares issued upon the exercise of this Warrant may not be
transferred or assigned in whole or in part without compliance with all
applicable federal and state securities laws by the transferor and transferee
(including the delivery of investment representation letters and legal opinions
reasonably satisfactory to the Company, if such are requested by the Company).
The Warrantholder, by acceptance hereof, acknowledges that this Warrant and the
Warrant Shares to be issued upon exercise hereof are being acquired solely for
the Warrantholder's own account and not as a nominee for any other party, and
for investment, and that the Warrantholder will not offer, sell or otherwise
dispose of this Warrant or any Warrant Shares to be issued upon exercise hereof
except under circumstances that will not result in a violation of the Securities
Act or any state securities laws. Upon exercise of this Warrant, the
Warrantholder shall, if requested by the Company, confirm in writing, in a form
satisfactory to the Company, that the Warrant Shares so purchased are being
acquired solely for the Warrantholder's own account and not as a nominee for any
other party, for investment, and not with a view toward distribution or resale.
2.2 Restrictive Legends. This Warrant shall (and each Warrant issued in
substitution for this Warrant pursuant to Section 4 shall) be stamped or
otherwise imprinted with a legend in substantially the following form:
"THIS WARRANT AND ANY SHARES ACQUIRED UPON THE EXERCISE OF THIS WARRANT
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND
MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT FILED UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION
FROM REGISTRATION UNDER SUCH ACT."
3
Except as otherwise permitted by this Section 2, each stock certificate for
Warrant Shares issued upon the exercise of this Warrant and each stock
certificate issued upon the direct or indirect transfer of any such Warrant
Shares shall be stamped or otherwise imprinted with a legend in substantially
the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT FILED
UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH
ACT."
Notwithstanding the foregoing, the Warrantholder may require the Company to
issue a stock certificate for Warrant Shares without a legend if (i) such
Warrant Shares, as the case may be, have been registered for resale under the
Securities Act and sold pursuant to such registration or sold pursuant to Rule
144 under the Securities Act (or a successor rule thereto) or (ii) the
Warrantholder has received an opinion of counsel reasonably satisfactory to the
Company that such registration is not required with respect to such Warrant
Shares.
3. Reservation of Shares, Etc.
The Company covenants and agrees that all Warrant Shares which are issued
upon the exercise of this Warrant will, upon issuance, be validly issued, fully
paid and nonassessable and free from all taxes (in accordance with Section 1.2
above), liens, security interests, charges and other encumbrances with respect
to the issue thereof. The Company further covenants and agrees that, during the
Exercise Period, the Company will at all times have authorized and reserved, and
keep available free from preemptive rights, a sufficient number of shares of
Common Stock to provide for the exercise of the rights represented by this
Warrant and will, at its expense, upon each such reservation of shares, procure
such listing of such shares of Common Stock (subject to issuance or notice of
issuance) as then may be required on all stock exchanges on which the Common
Stock is then listed or on Nasdaq if listed thereon.
4. Exchange, Loss or Destruction of Warrant.
Upon receipt by the Company of evidence satisfactory to it of the loss,
theft, destruction or mutilation of this Warrant and, in the case of loss, theft
or destruction, of such bond or 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 term "Warrant" as used in this Agreement shall be deemed to include any
Warrants issued in substitution or exchange for this Warrant.
5. Ownership of Warrant.
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 hereon made by anyone other than the Company) for all
purposes and shall not be affected by any notice to the contrary.
4
6. Certain Adjustments.
6.1 Adjustments in Number of Warrant Shares and in Exercise Price. The
number of Warrant Shares purchasable upon the exercise of this Warrant and the
Exercise Price shall be subject to adjustment as follows:
(a) Stock Dividends. If at any time prior to the exercise of this Warrant
in full (i) the Company shall fix a record date for the issuance of any stock
dividend payable in shares of Common Stock or other distribution with respect to
the Common Stock payable in securities or (ii) the number of shares of Common
Stock shall have been increased by a subdivision or split-up of shares of Common
Stock, then, on the record date fixed for the determination of holders of Common
Stock entitled to receive such dividend or distribution, or immediately after
the effective date of subdivision or split-up, as the case may be, the
securities to be delivered upon exercise of this Warrant will be increased so
that the Warrantholder will be entitled to receive the number of shares of
Common Stock and other securities (if any) that such Warrantholder would have
owned immediately following such action had this Warrant been exercised
immediately prior thereto, and the Exercise Price will be adjusted as provided
below in paragraph (f).
(b) Combination of Stock. If at any time prior to the exercise of this
Warrant in full the number of shares of Common Stock outstanding shall have been
decreased by a combination of the outstanding shares of Common Stock, then,
immediately after the effective date of such combination, the number of shares
of Common Stock to be delivered upon exercise of this Warrant will be decreased
so that the Warrantholder thereafter will be entitled to receive the number of
shares of Common Stock that such Warrantholder would have owned immediately
following such action had this Warrant been exercised immediately prior thereto,
and the Exercise Price will be adjusted as provided below in paragraph (f).
(c) Reorganization, etc. If at any time prior to the exercise of this
Warrant in full any capital reorganization of the Company, or any
reclassification of the Common Stock, or any consolidation of the Company with
or merger of the Company with or into any other person or any sale, lease or
other transfer of all or substantially all of the assets of the Company to any
other person, shall be effected in such a way that the holders of Common Stock
shall be entitled to receive stock, other securities or assets (whether such
stock, other securities or assets are issued or distributed by the Company or
another person) with respect to or in exchange for Common Stock, then, upon
exercise of this Warrant the Warrantholder shall have the right to receive the
kind and amount of stock, other securities or assets receivable upon such
reorganization, reclassification, consolidation, merger or sale, lease or other
transfer by a holder of the number of shares of Common Stock that such
Warrantholder would have been entitled to receive upon exercise of this Warrant
had this Warrant been exercised immediately before such reorganization,
reclassification, consolidation, merger or sale, lease or other transfer,
subject to adjustments that shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Section 6.
(d) Fractional Shares. No fractional shares of Common Stock or scrip shall
be issued to any Warrantholder in connection with the exercise of this Warrant.
Instead of any fractional shares of Common Stock that would otherwise be
issuable to such Warrantholder, the Company will pay to such Warrantholder a
cash adjustment in respect of such fractional interest in an
5
amount equal to that fractional interest of the then Current Market Price per
share of Common Stock.
(e) Carryover. Notwithstanding any other provision of this Section 6, no
adjustment shall be made to the number of shares of Common Stock to be delivered
to the Warrantholder (or to the Exercise Price) if such adjustment represents
less than 1% of the number of shares to be so delivered, but any 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 1% or more of the number of shares to be so
delivered.
(f) Exercise Price Adjustment. Whenever the number of Warrant Shares
purchasable upon the exercise of this Warrant is adjusted, as herein provided,
the Exercise Price payable upon the exercise of this Warrant shall be adjusted
by multiplying such Exercise Price immediately prior to such adjustment by a
fraction, of which the numerator shall be the number of Warrant Shares
purchasable upon the exercise of this Warrant immediately prior to such
adjustment, and of which the denominator shall be the number of Warrant Shares
purchasable immediately thereafter.
(g) No Duplicate Adjustments. Notwithstanding anything else to the contrary
contained herein, in no event will an adjustment be made under the provisions of
this Section 6 to the number of Warrant Shares issuable upon exercise of this
Warrant or the Exercise Price for any event if an adjustment having
substantially the same effect to the Warrantholder as any adjustment that
otherwise would be made under the provisions of this Section 6 is made by the
Company for any such event to the number of shares of Common Stock (or other
securities) issuable upon exercise of this Warrant.
6.2 No Adjustment for Dividends. Except as provided in Section 6.1, no
adjustment in respect of any dividends shall be made during the term of this
Warrant or upon the exercise of this Warrant.
6.3 Notice of Adjustment. Whenever the number of Warrant Shares or the
Exercise Price of such Warrant Shares is adjusted, as herein provided, the
Company shall promptly mail by first class, postage prepaid, to the
Warrantholder, notice of such adjustment or adjustments and a certificate of the
chief financial officer of the Company setting forth the number of Warrant
Shares and the Exercise Price of such Warrant Shares 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.
7. Notices of Corporate Action.
In the event of
(a) any taking by the Company of a record of the holders of any class of
securities for the purpose of determining the holders thereof who are entitled
to receive any dividend or other distribution, or any right to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right, or
6
(b) any capital reorganization of the Company, any reclassification or
recapitalization of the capital stock of the Company or any Change of Control,
or
(c) any voluntary or involuntary dissolution, liquidation or winding-up of
the Company,
the Company will mail to the Warrantholder a notice specifying (i) the date or
expected date on which any such record is to be taken for the purpose of such
dividend, distribution or right and the amount and character of any such
dividend, distribution or right, (ii) the date or expected date on which any
such reorganization, reclassification, recapitalization, Change of Control,
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 record of Common Stock (or
other securities) shall be entitled to exchange their shares of Common Stock (or
other securities) for the securities or other property deliverable upon such
reorganization, reclassification, recapitalization, Change of Control,
dissolution, liquidation or winding-up and (iii) that in the event of a Change
of Control, this Warrant is exercisable immediately prior to the consummation of
such Change of Control. Such notice shall be mailed at least 20 days prior to
the date therein specified, in the case of any date referred to in the foregoing
subdivisions (i) or (ii).
8. Definitions.
As used herein, unless the context otherwise requires, the following terms
have the following respective meanings:
Business Day: any day other than a Saturday, Sunday or a day on which
national banks are authorized by law to close in the City of New York, State of
New York.
Change of Control: shall mean (i) a sale, conveyance, exchange or transfer
of all or substantially all of the property and assets of the Company, (ii) the
sale of all or substantially all of the capital stock of the Company or the
merger or consolidation of the Company into or with any other corporation or an
affiliate thereof (except if such merger or consolidation does not result in the
transfer of more than fifty percent (50%) of the voting securities of the
Company or if such merger or consolidation is effected solely to change the
Company's jurisdiction of incorporation); or (iii) any sale or transfer of any
capital stock of the Company, following which fifty-one percent (51%) of the
combined voting power of the Company becomes beneficially owned by one person or
group acting together. For purposes of this definition, "group" shall have the
meaning as such term is used in section 13(d)(1) of the Exchange Act.
Commission: the Securities and Exchange Commission or any other federal
agency at the time administering the Securities Act or the Exchange Act,
whichever is the relevant statute for the particular purpose.
Company: Savoir Technology Group, Inc., a Delaware corporation.
Convertible Securities: securities by their terms convertible into or
exchangeable for Common Stock.
7
Exchange Act: the Securities Exchange Act of 1934, as amended, or any
successor federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Securities Exchange Act of 1934, as amended, shall
include a reference to a comparable section, if any, of any successor federal
statute.
Exercise Form: an Exercise Form in the form annexed hereto as Exhibit A.
Exercise Price: the meaning specified on the cover of this Warrant, as such
price may be adjusted pursuant to Section 6 hereof.
Nasdaq: the meaning specified in Section 1.1(c)(i).
Related Rights: options or warrants to purchase or rights to subscribe for
securities by their terms convertible into or exchangeable for Common Stock.
Rights: options or warrants to purchase or rights to subscribe for Common
Stock.
Securities: Convertible Securities, Rights and Related Rights.
Securities Act: the Securities Act of 1933, as amended, or any successor
federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time. Reference to a particular section of
the Securities Act of 1933, as amended, shall include a reference to the
comparable section, if any, of any successor federal statute.
Warrantholder: the meaning specified on the cover of this Warrant.
Warrant Shares: the meaning specified on the cover of this Warrant, subject
to the provisions of Section 6.
9. Miscellaneous.
9.1 Entire Agreement. This Warrant constitutes the entire agreement between
the Company and the Warrantholder with respect to this Warrant.
9.2 Binding Effects; Benefits. This Warrant shall inure to the benefit of
and shall be binding upon the Company and the Warrantholder and their respective
successors. Nothing in this Warrant, expressed or implied, is intended to or
shall confer on any person other than the Company and the Warrantholder, or
their respective successors, any rights, remedies, obligations or liabilities
under or by reason of this Warrant.
9.3 Amendments and Waivers. This Warrant may not be modified or amended
except by an instrument or instruments in writing signed by the Company and the
Warrantholder. Either the Company or the Warrantholder may, by an instrument in
writing, waive compliance by the other party with any term or provision of this
Warrant on the part of such other party hereto to be performed or complied with.
The waiver by any such party of a breach of any term or provision of this
Warrant shall not be construed as a waiver of any subsequent breach.
8
9.4 Section and Other Headings. The section and other headings contained in
this Warrant are for reference purposes only and shall not be deemed to be a
part of this Warrant or to affect the meaning or interpretation of this Warrant.
9.5 Further Assurances. Each of the Company and the Warrantholder shall do
and perform all such further acts and things and execute and deliver all such
other certificates, instruments and documents as the Company or the
Warrantholder may, at any time and from time to time, reasonably request in
connection with the performance of any of the provisions of this Warrant.
9.6 Notices. All notices and other communications required or permitted to
be given under this Warrant shall be in writing and shall be deemed to have been
duly given if delivered personally or sent by United States mail, postage
prepaid, to the parties hereto at the following addresses or to such other
address as any party hereto shall hereafter specify by notice to the other party
hereto:
(a) if to the Company, addressed to:
Savoir Technology Group, Inc.
254 East Hacienda Avenue
Campbell, California 95008
Attention: Chief Financial Officer
Telefax: (408) 378-0750
(b) if to the Warrantholder, to the address set forth on the Company's
register.
Except as otherwise provided herein, all such notices and communications shall
be deemed to have been received on the date of delivery thereof, if delivered
personally, or on the third Business Day after the mailing thereof.
9.7 Separability. Any term or provision of this Warrant which is invalid or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without rendering invalid
or unenforceable the terms and provisions of this Warrant or affecting the
validity or enforceability of any of the terms or provisions of this Warrant in
any other jurisdiction.
9.8 Governing Law. This Warrant shall be deemed to be a contract made under
the laws of the State of New York.
9
9.9 No Rights or Liabilities as Stockholder. Nothing contained in this
Warrant shall be deemed to confer upon the Warrantholder any rights as a
stockholder of the Company or to impose any liabilities on the Warrantholder to
purchase any securities whether such liabilities are asserted by the Company or
by creditors or stockholders of the Company or otherwise.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
duly authorized officer.
Dated: December 21, 1999.
SAVOIR TECHNOLOGY GROUP, INC.
By ___________________
Dennis J. Polk
Senior Vice President, Corporate Finance
10
Exhibit A
---------
EXERCISE FORM
-------------
(To be executed upon exercise of this Warrant)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant, to purchase Warrant Shares and (check one):
[ ] herewith tenders payment for _______ of the Warrant Shares to the
order of SAVOIR TECHNOLOGY GROUP, INC. in the amount of $_________ in
accordance with the terms of this Warrant; or
[ ] herewith tenders this Warrant for _______ Warrant Shares pursuant to
the Net Issue Exercise provisions of Section 1.1(b) of this Warrant.
The undersigned requests that a certificate (or certificates) for such Warrant
Shares be registered in the name of the undersigned and that such certificate
(or certificates) be delivered to the undersigned's address below.
In exercising this Warrant, the undersigned hereby confirms and
acknowledges that the Warrant Shares are being acquired solely for the account
of the undersigned and not as a nominee for any other party, for investment, and
that the undersigned will not offer, sell or otherwise dispose of any such
Warrant Shares except under circumstances that will not result in a violation of
the Securities Act of 1933, as amended, or any state securities laws.
Dated: ___________________.
__________________________
(Signature)
__________________________
(Print Name)
__________________________
(Street Address)
__________________________
(City) (State) (Zip Code)
If said number of shares shall not be all the shares purchasable under the
within Warrant, a new Warrant is to be issued in the name of said undersigned
for the balance remaining of the shares purchasable thereunder.
-----------------------------------------------------------------------
AMENDED AND RESTATED
WARRANT AGREEMENT OF
AVNET, INC.
11,452 SHARES
Dated as of July 3, 2000
------------------------------------------------------------------------
COMMON STOCK PURCHASE WARRANT
AMENDED AND RESTATED WARRANT AGREEMENT dated as of July 3, 2000, between
Avnet, Inc. (the "Company"), the Company as Warrant Agent, Savoir Technology
Group, Inc. ("Savoir") and IBM Credit Corporation (the "Warrant Holder" or
"Holder").
WHEREAS, in connection with an Inventory and Working Capital Agreement
Amendment #4 dated as of September 30, 1997, by and between Savoir (then known
as Western Micro Technology, Inc.) and the Holder, the Holder received warrants
(the "Original Warrants") to acquire 100,000 shares of Common Stock of Savoir,
at an exercise price of $7.50 per share, subject to adjustment, pursuant to a
Warrant Agreement dated September 30, 1997 (the "Original Warrant Agreement");
WHEREAS, pursuant to Section 2.6 of the Original Warrant Agreement, in
September 1998, the exercise price of the Original Warrants was reset to
$4.76875 per share (the "Reset");
WHEREAS, pursuant to an Amended and Restated Agreement and Plan of Merger
by and between the Company, Tactful Acquisition Corp. ("Tactful") and Savoir,
dated March 2, 2000 (the "Merger Agreement"), on July 3, 2000, Tactful merged
with and into Savoir (the "Merger") and Savoir became a wholly-owned subsidiary
of the Company;
WHEREAS, as a result of the the Merger, each outstanding share of common
stock of Savoir was converted into a right to receive a portion of a share of
the common stock, par value $1.00 per share, of the Company equal to number
derived by dividing $7.85 by $68.5472 (the "Exchange Ratio");
WHEREAS, pursuant to Section 1.9(ii) of the Merger Agreement, at the
effective time of the Merger, the Original Warrants were converted into a right
to acquire shares of the common stock, par value $1.00 per share (the "Shares")
of the Company, adjusted according to the Exchange Ratio (the "Warrants");
WHEREAS, the Company, Savoir and the Holder wish to amend and restate the
Original Warrant Agreement and the Original Warrants to reflect the effects of
the Reset and the Merger;
In consideration of the foregoing, and for the purpose of defining the
terms and provisions of all of the Warrants and the respective rights and
obligations thereunder of the Company and the Holder, the Company and the
Warrant Holder hereby agree as follows:
SECTION 1. TRANSFERABILITY AND FORM OF THE WARRANTS.
1.1 REGISTRATION. The Warrants shall be numbered and shall be registered on
the books of the Company maintained at the principal office of the Company at
2211 South 47th Street, Phoenix, Arizona 85034 (the "Warrant Register"). The
Company shall be entitled to treat the Holders of the Warrants as the owners in
fact thereof for all purposes and shall not be bound to recognize any equitable
or other claim to or interest in such Warrants on the part of any other person,
and shall not be liable for any Company registration or transfer of the Warrants
which is registered or to be registered in the name of a fiduciary or the
nominee of a fiduciary unless made with the actual knowledge that a fiduciary or
nominee is committing a breach of trust in requesting such registration of
transfer, or with such knowledge of such facts that its participation therein
amounts to bad faith.
1.2 TRANSFER RESTRICTIONS. The Warrants are freely transferable, subject to
applicable securities laws restrictions. The holder of any Warrants so
transferred shall continue to be bound by this Agreement. However, the minimum
denomination of any Warrant hereunder shall be a Warrant exchangeable for 1,000
Warrant Shares.
1.3 TRANSFER-GENERAL. Subject to the terms hereof, the Warrants shall be
transferable only on the books of the Company maintained at its principal office
upon delivery thereof duly endorsed by the Holder or by its duly authorized
attorney or representative, or accompanied by proper evidence of succession,
assignment or authority to transfer. In all cases of transfer by an attorney,
the original power of attorney, duly approved, or a copy thereof, duly
certified, shall be deposited and remain with the Company. In case of transfer
by executors, administrators, guardians or other legal representatives, duly
authenticated evidence of their authority shall be produced, and may be required
to be deposited and to remain with the Company in its discretion. Upon any
registration of transfer, the Company shall countersign and deliver new Warrants
to the Persons entitled thereto. The Company or the Warrant Agent may require
the payment of a sum sufficient to cover any tax or governmental charge that may
be imposed in connection with any such transfer.
1.4 NOTICES OF CORPORATE ACTIONS. In the event of: (a) any taking by the
Company of a record of the holders of the Common Stock for the purpose of
determining the holders thereof who are entitled to receive any dividend or
distribution, or any right to subscribe for, purchase or otherwise acquire any
shares of capital stock of any class or any other securities, (b) any capital
reorganization of the Company, any reclassification or recapitalization of the
capital stock of the Company or any consolidation or merger involving the
Company and any other Person or any transfer or other disposition of all or
substantially all the assets of the Company to another Person; (c) any voluntary
or involuntary dissolution, liquidation or winding-up of the Company, or (d) any
amendment of the Certificate of Incorporation of the Company, the Company shall
mail to each Warrant Holder in accordance with the provisions of Section 12
hereof a notice specifying (i) the date or expected date on which any such
record is to be taken for the purpose of such dividend, distribution or right,
and the amount and character of such dividend, distribution or right and (ii)
the date or expected date on which any such reorganization, reclassification,
recapitalization, consolidation, merger, transfer, disposition, dissolution,
liquidation or winding-up is to take place, the time, if any such time is to be
fixed, as of which the holders of record of Common Stock shall be entitled to
exchange their shares of Common Stock for the securities or other property
deliverable upon such
- 2 -
reorganization, reclassification, recapitalization, consolidation, merger,
transfer, disposition, dissolution, liquidation or winding-up and a description
in reasonable detail of the transaction. Such notice shall be mailed to the
extent practicable at least thirty (30), but not more than ninety (90) days
prior to the date therein specified. In the event that the Company at any time
sends any notice to the holders of its Common Stock, it shall concurrently send
a copy of such notice to each Warrant Holder.
1.5 FORM OF THE WARRANTS. The text of the Warrants and of the form of
election (the "Purchase Form") to purchase Shares pursuant to the Warrants
("Warrant Shares") shall be substantially as set forth in Exhibit A attached
hereto. The Exercise Price (as defined in and determined in accordance with the
provisions of Sections 2 and 6 hereof) and the number of Warrant Shares issuable
upon exercise of the Warrant is subject to adjustment upon the occurrence of
certain events, all as hereinafter provided. The Warrant shall be executed on
behalf of the Company by its Chairman of the Board, its Chief Executive Officer,
President, Chief Financial Officer, or one of its Vice Presidents, and attested
by its Secretary or an Assistant Secretary.
The Warrants shall be dated as of the date of countersignature thereof by
the Company either upon initial issuance or upon transfer.
SECTION 2. TERMS OF THE WARRANTS; EXERCISE OF THE WARRANTS; EXERCISE PRICE,
ETC.
2.1 TERM OF THE WARRANTS/VESTING. Subject to the terms of this Agreement,
the Holder shall have the right, which may be exercised from time to time until
September 30, 2004 (the "Expiration Date"), to purchase from the Company the
number of fully paid and nonassessable Warrant Shares which the Holder may at
the time be entitled to purchase on exercise of such Warrant. The Warrant is
fully vested. If the last day for the exercise of the Warrant shall not be a
business day, then the Warrant may be exercised on the next succeeding business
day.
2.2 EXERCISE OF THE WARRANTS. The Warrants may be exercised upon surrender
to the Company, at its principal office, of the certificate evidencing the
particular Warrant to be exercised, together with the Purchase Form on the
reverse thereof duly completed and executed, and upon payment to the Company of
the Exercise Price, for the number of Warrant Shares in respect of which such
Warrant is then exercised. Upon partial exercise, a Warrant certificate for the
unexercised portion shall be delivered to the Holder. Payment of the aggregate.
Exercise Price shall be made as provided in Section 2.3 below.
Subject to Section 3 hereof, upon such surrender of a Warrant, a completed
Purchase Form, and payment of the Exercise Price as aforesaid, the Company shall
issue and cause to be delivered with all reasonable dispatch to or upon the
written order of the Holder and in such name or names as the Holder may
designate, a certificate or certificates for the number of full Warrant Shares
so purchased upon the exercise of the particular Warrant, together with an
additional whole share in respect of any fractional Warrant Share otherwise
issuable upon such surrender. Such certificate or certificates shall be deemed
to have been issued and any person so designated to be named therein shall be
deemed to have become a holder of record of such Warrant Shares as of the date
of the surrender of the particular Warrant, a completed Purchase Form, and
payment of the Exercise Price, as aforesaid; provided, however, that if, at the
date of surrender of the particular Warrant, a completed Purchase Form, and
payment of such Exercise Price, the transfer books for the Warrant Shares or
other class of stock purchasable upon the exercise of the particular Warrant
shall be closed, the certificates for the Warrant Shares in respect of which the
particular Warrant is then exercised shall be issuable as of the date on which
such books shall next be opened (whether before or after the
- 3 -
Expiration Date) and until such date the Company shall be under no duty to
deliver any certificate for such Warrant Shares; provided, further, that the
transfer books of record, unless otherwise required by law, shall not be closed
at any one time for a period longer than 20 calendar days.
2.3 PAYMENT OF THE EXERCISE PRICE. Payment of the Exercise Price shall be
made at the option of the Holder by one or more of the following methods: (i) by
delivery of cash, or a certified or official bank check in the amount of such
Exercise Price, (ii) by instructing the Company to withhold a number of Warrant
Shares then issuable upon exercise of the particular Warrant with an aggregate
Fair Value (as defined in Section 7 hereof) equal to such Exercise Price (the
"Share Withholding Option"), (iii) by surrender to the Company of Notes in
principal amount plus accrued interest equal to the applicable Exercise Price,
or (iv) by surrendering to the Company shares of Common Stock previously
acquired by the Holder with an aggregate Fair Value equal to such Exercise
Price, or any combination of foregoing. In the event of any withholding of
Warrant Stock or surrender of Common Stock pursuant to clause (ii) or (iv) above
where the number of shares whose Fair Value is equal to the Exercise Price is
not a whole number, the number of shares withheld by or surrendered to the
Company shall be rounded down to the nearest whole share.
2.4 COMPLIANCE WITH GOVERNMENT REGULATIONS. Holder acknowledges that none
of the Warrants or Warrant Shares has been registered under the Act, and may be
sold or disposed of in the absence of such registration only pursuant to an
exemption from such registration and in accordance with this Agreement. The
Warrants and Warrant Shares will bear a legend to the following effect:
"THE SALE OF THE SECURITIES REPRESENTED HEREBY HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"). NO SALE OR OTHER DISPOSITION OR PLEDGE OF THESE
SECURITIES OR THE SECURITIES UNDERLYING THESE SECURITIES CAN
BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT
RELATING THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY OR A NO ACTION LETTER OR INTERPRETIVE OPINION OF THE
STAFF OF THE SECURITIES AND EXCHANGE COMMISSION THAT SUCH
REGISTRATION IS NOT REQUIRED UNDER THE ACT."
2.5 EXERCISE PRICE. The price per share at which Warrant
Shares shall be purchasable upon exercise of the Warrant (the "Exercise Price")
shall be $41.64 per share, subject to adjustment pursuant to Section 6 hereof.
2.6 EXERCISE PRICE RESET. In the event that on any anniversary
of September 30, 1997 during the term of the Warrants, the average of the
closing bid price for the ten (10) Trading Days prior to such anniversary is
less than the Exercise Price of the Warrants then in effect, then the Exercise
Price of the Warrants shall be reset to 87.5% of the average of the closing bid
prices for such ten (10) Trading Day period. In the event that the Common Stock
of the Company is no longer publicly traded on any such anniversary date, then
in lieu of the ten (10) Trading Day average of the closing bid prices, the Fair
Value of the Common Stock shall be used.
SECTION 3. PAYMENT OF TAXES. The Company will pay all documentary stamp
taxes, if any, attributable to the initial issuance of the Warrants and Warrant
Shares upon the exercise of any of the
- 4 -
Warrants; provided, however, that the Company shall not be required to pay any
tax or taxes which may be payable in respect of any transfer involved in the
issue or delivery of the Warrants or certificates for Warrant Shares in a name
other than that of the Holder of the particular Warrant.
SECTION 4. MUTILATED OR MISSING WARRANTS. In case the Warrant shall be
mutilated, lost, stolen or destroyed, the Company shall issue and deliver in
exchange and substitution for and upon cancellation of the mutilated Warrant, or
in lieu of and substitution for the Warrant lost, stolen or destroyed, a new
Warrant certificate of like tenor and representing an equivalent right or
interest; but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction of the particular Warrant certificate
and indemnity or bond, if requested, also reasonably satisfactory to them. An
applicant for such substitute Warrant certificate shall also comply with such
other reasonable regulations and pay such other reasonable charges as the
Company may prescribe.
SECTION 5. RESERVATION OF WARRANT SHARES.
5.1 RESERVATION OF WARRANT SHARES. There have been reserved, and the
Company shall at all times keep reserved, out of its authorized shares of Common
Stock, a number of shares of Common Stock sufficient to provide for the exercise
of the rights of purchase represented by the outstanding Warrants. The transfer
agent for the Common Stock ("Transfer Agent"), and every subsequent transfer
agent for any shares of the Company's capital stock issuable upon the exercise
of any of the rights of purchase aforesaid will be and are hereby irrevocably
authorized and directed at all times until the Expiration Date to reserve such
number of authorized shares as shall be requisite for such purpose. The Company
will keep a copy of this Agreement on file with the Transfer Agent and with
every subsequent transfer agent for any shares of the Company's capital stock
issuable upon the exercise of the rights of purchase represented by the Warrant.
The Company covenants that all Warrant Shares which may be issued upon exercise
of the Warrant will, upon issue, be fully paid, nonassessable, free of
preemptive rights in any third party and free from all taxes, liens, charges and
security interests with respect to the issue thereof. The Company will supply
such Transfer Agent and any subsequent transfer agent with duly executed stock
certificates for such purpose and will itself provide or otherwise make
available any cash which may be payable as provided in Section 8 of this
Agreement. The Company will furnish to such Transfer Agent a copy of all notices
of adjustments, and certificates related thereto, transmitted to each Holder.
The particular Warrant surrendered in the exercise of the rights thereby
evidenced shall be canceled by the Company.
5.2 CANCELLATION OF THE WARRANTS. In the event the Company shall purchase a
Warrant, or otherwise acquire any of the Warrants, the particular Warrant shall
be canceled and retired.
SECTION 6. ADJUSTMENT OF THE EXERCISE PRICE AND NUMBER OF WARRANT SHARES.
The number and kind of securities purchasable upon the exercise of the Warrant
and the Exercise Price shall be subject to adjustment from time to time upon the
happening of certain events, as hereinafter defined.
6.1 STOCK DIVIDENDS, SUBDIVISIONS AND COMBINATIONS. If at any time the
Company shall:
(1) take a record of the holders of its Common Stock for the purpose of
entitling them to receive a dividend payable in, or other distribution of,
additional shares of Common Stock,
- 5 -
(2) subdivide its shares of Common Stock outstanding into a larger number
of shares of such Common Stock, or
(3) combine its shares of Common Stock outstanding into a smaller number of
shares of such Common Stock, then the number of Warrant Shares shall be adjusted
so that the Warrant Holder thereafter will be entitled to receive the number of
shares of Common Stock that such Warrant Holder would have owned immediately
following such action had the Warrant been exercised immediately prior thereto,
and the Exercise Price of the Warrant shall be adjusted to equal the product of
the Exercise Price in effect immediately prior to such event multiplied by a
fraction the numerator of which is equal to the number of Warrant Shares
purchasable upon the exercise of the Warrant immediately prior to such
adjustment, and the denominator of which is equal to the number of Warrant
Shares purchasable immediately thereafter, and thereafter the provisions of this
Warrant Agreement shall apply with like effect to such additional or
reclassified shares.
6.2. RIGHTS OFFERINGS AND OFFERINGS OF COMMON STOCK.
(a) In the event that the Company issues rights, options or warrants to all
holders of its Common Stock in respect of its Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share less than
the Fair Value per share (determined as provided below) of the Common Stock on
the date fixed for the determination of stockholders entitled to receive such
rights, options or warrants, the Exercise Price in effect at the opening of
business on the day following the date fixed for such determination shall be
decreased by multiplying such Exercise Price by a fraction of which 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 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 Value and 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 so offered for
subscription or purchase, such decrease to become effective immediately after
the opening of business on the day following the date fixed for such
determination. To the extent that shares of Common Stock are not delivered after
the expiration of such rights, options or warrants, the Exercise Price shall be
readjusted (but only with regard to any Warrant exercised after such expiration)
to the Exercise Price that would be in effect had the adjustment made upon the
issuance of such rights, options or warrants been made upon the basis of
delivery of only the number of shares of Common Stock actually issued. The
Company will not issue any rights, options or warrants in respect of shares of
Common Stock held in the treasury of the Company. The foregoing provisions of
this Section 6.2 shall not apply to any rights issued to holders of Common Stock
that are not currently exercisable and shall not apply until such time that such
rights become exercisable.
(b) In case the Company shall issue shares of Common Stock, Stock Purchase
Rights or Convertible Securities, for a price per share of Common Stock, in the
case of the issuance of Common Stock, or for a price per share of Common Stock
initially deliverable upon conversion or exchange of such securities less than
Fair Value per share of Common Stock on the date the Company fixed the offering,
conversion or exchange price of such additional shares, the Exercise Price in
effect at the opening of business on the day following the date fixed for such
determination shall be decreased by multiplying such Exercise Price by a
fraction of which 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 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 Value and the denominator shall be the
number of shares of Common Stock
- 6 -
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 decrease to become effective immediately after the opening of
business on the day following the date fixed for such determination. Such
adjustment shall be made whenever such shares, Stock Purchase Rights or
Convertible Securities are issued, and shall become effective immediately after
the effective date of such event retroactive to the record date, if any, for
such event. To the extent that shares of Common Stock are not delivered after
the expiration of such Stock Purchase Rights or the Convertible Securities are
not converted, the Exercise Price shall be readjusted (but only with regard to
any Warrant exercised after such expiration) to the Exercise Price that would be
in effect had the adjustment made upon the issuance of such Stock Purchase
Rights or Convertible Securities been made upon the basis of delivery of only
the number of shares of Common Stock actually issued.
6.3 OTHER DISTRIBUTIONS. In case the Company shall, by dividend or
otherwise, distribute to all holders of its Common Stock cash, evidences of
indebtedness, shares of any class of capital stock or any other property or
rights (including securities, but excluding (i) any dividend or distribution
referred to in Section 6.1, and (ii) any merger or consolidation or other
transactions to which Section 6.4 applies), then, in such event, upon the
exercise of the Warrant, the Holder shall receive from the Company, in addition
to the shares of Common Stock to which the Holder is entitled, any cash,
evidences of indebtedness, shares of any class of capital stock or any other
property distributed by the Company with respect to the shares of Common Stock
as to which the exercised Warrant pertains, and until such Exercise the Company
shall retain the cash, evidences of indebtedness, shares of any class of capital
stock, or other property or rights so distributed in trust for the benefit of
the Holder. Upon the expiration of any such unexercised Warrant, to the extent
not exercised, the property held in trust shall be released to the Company or
its designee.
In the event of a distribution by the Company to holders of its shares of
Common Stock of stock of a subsidiary or securities convertible into or
exercisable for such stock, then in lieu of an adjustment in the number of
Shares purchasable upon the exercise of any of the Warrants, the Holder of any
of the Warrants, upon the exercise thereof at any time after such distribution,
shall be entitled to receive from the Company, such subsidiary or both, as the
Company shall determine, the stock or other securities to which such Holder
would have been entitled if such Holder had exercised the particular Warrant
immediately prior thereto, all subject to further adjustment as provided in this
Section 6.
6.4 REORGANIZATION, RECLASSIFICATION, MERGER, CONSOLIDATION OR DISPOSITION
OF ASSETS.
(a) 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 or where there is any change whatsoever
in, or distribution with respect to, the outstanding Common Stock of the
Company), or sell, transfer or otherwise dispose of all or substantially all of
its property, assets or business to another corporation and, pursuant to the
terms of such reorganization, reclassification, merger, consolidation or
disposition of assets, (i) shares of common stock of the successor or acquiring
corporation or of the Company (if it is the surviving corporation) or (ii) any
cash, shares of stock or other securities or property of any nature whatsoever
(including warrants, options, or other subscription or purchase rights) in
addition to or in lieu of common stock of the successor or acquiring corporation
are to be received by or distributed to the holders of Common Stock of the
Company who are holders immediately prior to such transaction, then the Holder
of the Warrants shall have the right thereafter to receive from the Company,
upon exercise of the applicable 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
- 7 -
reorganization, reclassification, merger, consolidation or disposition of assets
by a holder of the number of shares of Common Stock for which the Warrants are
exercisable immediately prior to such event and until such exercise the Company
shall retain the cash, evidences of indebtedness, shares of any class of capital
stock, or other property or rights so received in trust for the benefit of the
Holder. If the Warrant is exercised in such event, the aggregate Exercise Price
otherwise payable for the shares of Common Stock transferable upon exercise of
the Warrant shall be allocated among the shares of common stock and other
property receivable as a result of such reorganization, reclassification,
merger, consolidation or disposition of assets in proportion to the respective
fair market values of such shares of common stock and other property as
determined in good faith by the Holder and the Company, if necessary. Upon the
expiration of any such unexercised Warrant, to the extent not exercised, the
property held in trust shall be released to the Company or its designee.
(b) 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
Agreement to be performed and observed by the Company and all the obligations
and liabilities hereunder. For purposes of this Section 6.4, "common stock of
the successor or acquiring corporation" shall include stock of such corporation
ration of any class that is not preferred as to dividends or assets over any
other class of stock of such corporation and that is not subject to redemption
and shall also include any evidences of indebtedness, shares of stock or other
securities that 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 6.4 shall similarly
apply to successive reorganizations, reclassification, mergers, consolidations
or disposition of assets.
6.5 ADJUSTMENT OF NUMBER OF SHARES PURCHASABLE. Upon any adjustment of the
Exercise Price as provided in Section 6.2 hereof, the Holder shall thereafter be
entitled to purchase upon the exercise of the Warrant, at the Exercise Price
resulting from such adjustment, the number of shares of Common Stock obtained by
multiplying the Exercise Price in effect immediately prior to such adjustment by
the number of shares of Common Stock transferable on the exercise hereof
immediately prior to such adjustment and dividing the product thereof by the
Exercise Price resulting from such adjustment.
6.6 DETERMINATION OF CONSIDERATION. For purposes of Section 6.2 hereof, the
consideration received and/or receivable by the Company in connection with the
issuance, sale, grant or exercise of additional shares of Common Stock, Stock
Purchase Rights or Convertible Securities, irrespective of the accounting
treatment of such consideration, shall be valued as follows:
(1) SECURITIES OR OTHER PROPERTY. In the case of securities or other
property, the fair market value thereof as of the date immediately preceding
such issuance, sale, grant or exercise as determined in good faith by the Board
of Directors of the Company which determination shall be conclusive absent
manifest error.
(2) DIVIDENDS IN SECURITIES. In case the Company shall declare a dividend
or make any other distribution upon any stock of the Company payable in either
case in Common Stock or Convertible Securities, such Common Stock or Convertible
Securities, as the case may be, issuable in payment of such dividend or
distribution shall be deemed to have been issued or sold without consideration.
(3) MERGER, CONSOLIDATION OR SALE OF ASSETS. In case any shares of Common
Stock, Stock Purchase Rights or Convertible Securities shall be issued in
connection with any merger or
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consolidation in which the Company is the surviving corporation, the amount of
consideration therefor shall be deemed to be the fair value of such portion of
the assets and business of the non-surviving corporation attributable to such
Common Stock, Stock Purchase Rights or Convertible Securities, as is determined
in good faith by the Board of Directors of the Company which determination shall
be conclusive absent manifest error.
6.7 OTHER PROVISIONS APPLICABLE TO ADJUSTMENTS UNDER THIS SECTION. The
following provisions shall be applicable to the adjustments provided for
pursuant to this Section 6:
(A) WHEN ADJUSTMENTS TO BE MADE. The adjustments required by this Section 6
shall be made whenever and as often as any specified event requiring such an
adjustment shall occur. For the purpose of any such adjustment, any specified
event shall be deemed to have occurred at the close of business in New York on
the date of its occurrence.
(B) FRACTIONAL INTERESTS. In computing adjustments under this Section 6,
fractional interests in Common Stock shall be taken into account to the nearest
1/100th of a share.
(C) WHEN ADJUSTMENT NOT REQUIRED.
(1) If the Company shall take a record of the holders of its Common Stock
for the purpose of entitling them to receive a dividend or distribution to which
the provisions of Section 6 would apply, but shall, thereafter and before the
distribution to stockholders thereof, legally abandon its plan to pay or deliver
such dividend or distribution, then thereafter no adjustment shall be required
by reason of the taking of such record and any such adjustment previously made
in respect thereof shall be rescinded and annulled.
(2) In case the Company shall sell or issue shares of Common Stock or Stock
Purchase Rights in the following situations:
(i) to, officers, directors, consultants or employees of the Company
pursuant to a plan approved by the Company's shareholders or Board of Directors
at a price not less than 85% of the Fair Value of the Company's Common Stock in
an amount (taking into account all prior sales or issuances excluded pursuant to
this clause (i)) not greater than 5% of the total number of shares of Common
Stock Outstanding; or
(ii) pursuant to a provision in any existing agreement between the Company
and any third party in respect of an acquisition by the Company in which all or
a portion of the consideration in connection with such acquisition is payable by
the issuance of shares of Common Stock or Stock Purchase Rights; or
(iii) to the former holders of Savoir's Series A Preferred Stock, $0.01 par
value, as dividends thereon; or
(iv) to any Person upon the exercise of any Stock Purchase Right of Savoir
outstanding on September 30, 1997;
(v) to Canpartners Investments IV, LLC and Robert Fleming Inc., a Delaware
corporation, upon exercise of their warrant dated September 30, 1997, to acquire
45,808 shares of the Company's Common Stock,
- 9 -
there shall be no adjustment in the Exercise Price or the number of Warrant
Shares either upon the initial issuance of such securities or upon the exercise
or conversion thereof.
(d) MAXIMUM EXERCISE PRICE. Except with respect to mechanical adjustments
pursuant to Section 6.1 above, at no time shall the Exercise Price per share of
Common Stock exceed the amount set forth in Section 2.5 of this Agreement, as
adjusted pursuant to Section 2.6.
(e) CERTAIN LIMITATIONS. Notwithstanding anything herein to the contrary,
the Company agrees not to enter into any transaction that, by reason of any
adjustment under Section 6 above, would cause the Exercise Price to be less than
the par value of the Common Stock, if any, unless the Company first reduces the
par value of the Common Stock to be less than the Exercise Price that would
result from such transaction.
(f) NOTICE OF ADJUSTMENTS. Whenever the number of shares of Common Stock
for which the Warrants are exercisable or the Exercise Price shall be adjusted
pursuant to this Section 6, the Company forthwith shall prepare a certificate to
be executed by either the chief executive or chief financial officer of the
Company setting forth, in reasonable detail, the event requiring the adjustment
and the method by which such adjustment was calculated, specifying the number of
shares of Common Stock for which the Warrants are exercisable and (if such
adjustment was made pursuant to Section 6.3) describing the number and kind of
any other shares of stock or other property for which the Warrants are
exercisable, and any related change in the Exercise Price, after giving effect
to such adjustment or change. The Company shall promptly deliver a signed copy
of such certificate to the Holder in accordance with Section 12. The Company
shall keep at its principal office copies of all such certificates and cause the
same to be available for inspection at said office during normal business hours
by any Holder or any prospective transferee of any Warrants designated by a
Holder thereof.
(g) INDEPENDENT APPLICATION. Except as otherwise provided herein, all
subsections of this Section 6 are intended to operate independently of one
another (but without duplication). If an event occurs that requires the
application of more than one subsection, all applicable subsections shall be
given independent effect without duplication.
6.8 RIGHT OF FIRST REFUSAL. As used in this Section 6.8, the term "Holder's
Ratio" means the sum of the number of shares of Common Stock of the Company,
plus the number of shares of Common Stock of the Company underlying the
Warrants, plus the number of shares of Common Stock of the Company underlying
Stock Purchase Rights, held by a Holders or its assigns, divided by the number
of shares of Common Stock of the Company Outstanding from time to time. The
Company agrees that if at any time while a Holder holds shares of Common Stock
of the Company or Warrants, if the Company desires to sell or issue shares of
Common Stock or Stock Purchase Rights of the Company (excluding shares of Common
Stock issuable after the date hereof pursuant to Stock Purchase Rights of the
Company existing on the date hereof, or shares issuable in connection with the
matters listed in Section 6.7(c)(2)), then the Company shall first notify all
the Holders of the terms of such proposed sale and issuance and permit the
Holders to acquire on the same terms and conditions (which need only include
monetary terms and conditions and not need include any terms and conditions
which cannot be matched by the Holders) an amount equal to the number of shares
of Common Stock or Stock Purchase Rights proposed to be issued or sold times the
Holder's Ratio. The Holders shall have ten (10) Business Days after receipt of
such notice to elect by notice to the Company in writing whether to purchase
such shares of Common Stock or such Stock Purchase Rights, and may withdraw
their election by notice to the Company at any time up to two (2) Business Days
prior to the closing of the offer. After the ten (10) Business Day period has
expired, the Company shall have up to
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ninety (90) days (or such longer time as may be reasonable necessary in the
event the proposed issuance is pursuant to a public offering of shares of Common
Stock or Stock Purchase Rights) to complete the sale of any such shares of
Common Stock or Stock Purchase Rights, provided that if the Company later
desires to change the terms of such sale or issuance in any material respect it
shall first reoffer such shares of Common Stock or Stock Purchase Rights to the
Holders pursuant to the procedures set forth herein.
The Right of First Refusal set forth in this Section may only be
transferred in connection with a transfer of the Warrants or Warrant Shares and
shall terminate with respect to any of the Holders' shares after such shares
have been sold pursuant to a registration statement filed with and declared
effective by the Securities and Exchange Commission or pursuant to Rule 144
under the Act, and shall in no event continue beyond the term of the Warrants.
SECTION 7. DEFINITIONS.
As used in this Warrant Agreement, the following terms shall have the
following respective meanings:
ACT shall mean the Securities Act of 1933, as amended.
BUSINESS DAY shall mean any day that is not a Saturday or Sunday or a day
on which banks are required or permitted to be closed in New York or California.
COMMON STOCK means the Common Stock of the Company, $1.00 par value per
share, and any capital stock into which such Common Stock may thereafter be
changed, and shall also include (i) capital stock of the Company of any other
class (regardless of how denominated) issued to the holders of shares of any
Common Stock upon any reclassification thereof which is also not preferred as to
dividends or liquidation over any other class of stock of the Company and which
is not subject to redemption and (ii) shares of common stock of any successor or
acquiring corporation (as defined in Section 6.4 hereof) received by or
distributed to the holders of Common Stock of the Company in the circumstances
contemplated by Section 6.4 hereof.
CONVERTIBLE SECURITIES shall mean evidences of indebtedness, shares of
stock or other securities that are convertible into or exchangeable for, with or
without payment of additional consideration in cash or property, shares of
Common Stock, either immediately or upon the occurrence of a specified date or a
specified event.
CURRENT MARKET PRICE shall mean as of any specified date the average of the
Daily Market Price of the Common Stock of the Company for the twenty (20)
consecutive Trading Days immediately preceding such date. The "Daily Market
Price" for each such Trading Day shall be the closing price of the Common Stock
on the principal stock exchange or market on which such stock is actually
traded.
FAIR VALUE means, per share of Common Stock as of any specified date, (i)
if the Common Stock is publicly traded on such date, the Current Market Price
per share or (ii) if the Common Stock is not publicly traded on such date, the
fair market value per share of Common Stock shall be agreed upon in good faith
between the Holders and the Company.
OUTSTANDING shall mean, when used with reference to Common Stock, at any
date as of which the number of shares thereof is to be determined, all issued
and outstanding shares of
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Common Stock, except shares then owned or held by or for the account of the
Company or any Subsidiary there of.
PERSON shall mean any individual, sole proprietorship, partnership, limited
liability company, joint venture, trust, incorporated organization, association,
corporation, institution, public benefit corporation, entity or government
(whether federal, state, county, city, municipal or otherwise, including,
without limitation, any instrumentality, division, agency, body or department
thereof).
PREEMPTIVE RIGHT means a right of a stockholder to preempt or to purchase
before others a new issue of shares in proportion to one's present interest in
the Company.
STOCK PURCHASE RIGHTS shall mean any options, warrants or other securities
or rights to subscribe to or exercisable for the purchase of shares of Common
Stock or Convertible Securities, whether or not immediately exercisable.
TRADING DAY means any day that the principal stock exchange or market on
which the securities of the Company are traded is open for trading.
SECTION 8. FRACTIONAL INTERESTS. The Company shall not be required to issue
fractional Warrant Shares on the exercise of the Warrant. If any fraction of a
Warrant Shares would, except for the provisions of this Section 8, be issuable
on the exercise of the Warrant (or specified portion thereof), the Company shall
round up such share to an additional whole share of Common Stock.
SECTION 9. NO RIGHTS AS STOCKHOLDER; NOTICES TO HOLDER. Nothing contained
in either this Agreement or the Warrant shall be construed as conferring upon
the Holder or its permitted transferees the right to vote or to receive
dividends or to consent to or receive notice as a stockholder in respect of any
meeting of stockholders for the election of directors of the Company or any
other matter, or any rights whatsoever as a stockholder of the Company.
SECTION 10. INSPECTION OF WARRANT AGREEMENT. The Company shall keep copies
of this Agreement and any notices given or received hereunder available for
inspection by the Holder during normal business hours at its principal office.
SECTION 11. IDENTITY OF TRANSFER AND WARRANT AGENT. Forthwith upon the
appointment of any subsequent transfer agent for the Common Stock or Warrant
Agent, or any other shares of the Company's capital stock issuable upon the
exercise of the Warrant, the Company will notify the Holder of the name and
address of such subsequent transfer agent.
SECTION 12. NOTICES. Any notice pursuant to this Agreement by any Holder to
the Company, shall be in writing and shall be mailed first class, postage
prepaid, or delivered to the Company at its office at 2211 South 47th Street,
Phoenix, Arizona 85034.
Each party hereto may from time to time change the address to which notices
to it are to be delivered or mailed hereunder by notice in writing to the other
party. Any notice mailed pursuant to this Agreement by the Company or the
Warrant Agent to the Holder shall be in writing and shall be mailed first class,
postage prepaid, or delivered to the Holder at its address on the books of the
Warrant Agent.
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SECTION 13. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to principles of conflict of laws. The parties hereto agree to submit to
the jurisdiction of the United States District Court for the Southern District
of New York and the jurisdiction of any court of the State of New York located
in New York County in any action or proceeding arising out of or relating to
this Agreement.
SECTION 14. WAIVER OF JURY TRIAL. EACH OF THE COMPANY AND THE HOLDER HEREBY
IRREVOCABLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
(INCLUDING ANY COUNTERCLAIM) OF ANY TYPE IN WHICH THE COMPANY AND THE HOLDER ARE
PARTIES AS TO ALL MATTERS ARISING DIRECTLY OR INDIRECTLY OUT OF THIS AGREEMENT
OR ANY DOCUMENT, INSTRUMENT OR AGREEMENT EXECUTED IN CONNECTION HEREWITH.
SECTION 15. SUCCESSORS. All the covenants and provisions of this Agreement
by or for the benefit of the Company or the Warrant Agent shall bind and inure
to the benefit of their respective successors and assigns hereunder.
SECTION 16. MERGER OR CONSOLIDATION OF THE COMPANY. So long as the Warrant
remains outstanding, the Company will not merge consolidate with or into, or
sell, transfer or lease all or substantially all of its property to, any other
corporation unless the successor or purchasing corporation, as the case may be
(if not the Company), shall expressly assume, by supplemental agreement, the due
and punctual performance and observance of each and every covenant and condition
of this Agreement to be performed and observed by the Company.
SECTION 17. AMENDMENTS AND WAIVERS. This Agreement may not be modified or
amended except by an instrument or instruments in writing signed by the Company
and a majority of the Holders (by number of shares). Either the Company or any
Holder may, by an instrument in writing, waive compliance by the other party
with any term or provision of this Agreement on the part of such other party
hereto to be performed or complied with. The waiver by any such party of a
breach of any term or provision of this Agreement shall not be construed as a
waiver by any other party or of any subsequent breach.
SECTION 18. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall be
construed to give to any person or corporation, other than the Company and the
Holder, any legal or equitable right, remedy or claim under this Agreement, but
this Agreement shall be for the sole and exclusive benefit of the Company and
the Holder.
SECTION 19. AGREEMENT IN CONFIDENCE. This Agreement and its terms and the
relationship between the Company and the Warrant Holder and its principals shall
be kept confidential by the Warrant Holder and its affiliates and by Company and
its affiliates and will not be disclosed by either of them except to the extent
that as a matter of law it must be disclosed by either party in any document
filed with any government agency or authority and available for public
inspection or as may be required to be disclosed in connection with the
Company's sale of its capital stock or assets or its merger, reorganization,
consolidation or similar event.
SECTION 20. CAPTIONS. The captions of the Sections of this Agreement have
been inserted for convenience only and shall have no substantive effect.
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SECTION 21. COUNTERPARTS. This Agreement may be executed in any number of
counterparts each of which so executed shall be deemed to be an original; but
such counterparts together shall constitute but one and the same instrument.
* * *
- 14 -
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day, month and year first above written.
THE COMPANY, AND
AS THE WARRANT AGENT:
AVNET, INC.,
a New York corporation
By:________________________
Title:
SAVOIR
SAVOIR TECHNOLOGY GROUP, INC.
a Delaware corporation
By:________________________
Title:
THE WARRANT HOLDER:
IBM CREDIT CORPORATION
By: _____________________
Title:
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EXHIBIT A
No. ___ ________ Shares
COMMON STOCK PURCHASE WARRANT
Void After 5:00 P.M.
Pacific Daylight Time on September 30, 2004
THIS CERTIFIES THAT, for value received, IBM Credit Corporation, the
registered holder of this Common Stock Purchase Warrant (the "Warrant") or
permitted assigns (the "Holder"), is entitled to purchase from Avnet, Inc., a
New York corporation (the "Company"), at any time until September 30, 2004 (the
"Expiration Date"), at the purchase price per share of $41.65(the "Exercise
Price"), the number of shares of Common Stock of the Company (the "Common
Stock") which is equal to the number of Shares set forth above. The number of
shares purchasable upon exercise of this Warrant and the Exercise Price per
share shall be subject to adjustment from time to time as set forth in the
Warrant Agreement referred to below.
This Warrant is issued under and in accordance with an Amended and Restated
Warrant Agreement dated as of July 3, 2000 (the "Warrant Agreement"), between
the Company and the Warrant Holder and is subject to the terms and provisions
contained in the Warrant Agreement, to all of which the Holder of this Warrant
by acceptance hereof consents. A copy of the Warrant Agreement may be obtained
for inspection by the Holder hereof upon written request to the Company.
This Warrant may be exercised in whole or in part by presentation of this
Warrant with the Purchase Form annexed hereto duly executed and simultaneous
payment of the Exercise Price (subject to adjustment) at the principal office of
the Company at 2211 South 47th Street, Phoenix, Arizona, 85034. Payment of such
price shall be made at the option of the Holder hereof in cash or by certified
or official bank check or otherwise as set forth in the Warrant Agreement,
including in the form of a "net exercise." Terms relating to exercise of this
Warrant is set forth more fully in the Warrant Agreement.
This Warrant may be exercised in whole or in part. Upon partial exercise, a
Warrant certificate for the unexercised portion shall be delivered to the
Holder. No fractional shares will be issued upon the exercise of this Warrant
but the Company shall round up to a whole share any fractional share issuable
upon the exercise of this Warrant. This Warrant is transferable only in limited
circumstances as described in the Warrant Agreement at the office of the
Company, in the manner and subject to the limitations set forth in the Warrant
Agreement.
- 16 -
EXHIBIT A-1
"THE SALE OF THE SECURITIES REPRESENTED HEREBY HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). NO SALE OR
OTHER DISPOSITION OR PLEDGE OF THESE SECURITIES OR THE SECURITIES
UNDERLYING THESE SECURITIES CAN BE EFFECTED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT RELATING THERETO OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY OR A NO ACTION LETTER OR INTERPRETIVE
OPINION OF THE STAFF OF THE SECURITIES AND EXCHANGE COMMISSION THAT
SUCH REGISTRATION IS NOT REQUIRED UNDER THE ACT."
The Holder hereof may be treated by the Company and all other persons
dealing with this Warrant as the absolute owner hereof for any purpose and as
the person entitled to exercise the rights represented hereby, or to the
transfer hereof on the books of the Company. Any notice to the contrary
notwithstanding, and until such transfer on which books, the Company may treat
the Holder hereof as the owner for all purposes.
This Warrant does not entitle any Holder hereof to any of the rights of a
stockholder of the Company.
This Warrant shall not be valid or obligatory for any purpose until it
shall have been countersigned by the Company.
AVNET,INC.,
a New York corporation
By ___________________________
Name:
Title:
Attest _________________________
Name:
Title:
DATED: As of July 3, 2000
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EXHIBIT A-2
PURCHASE FORM
Mailing Address
- -------------------------------- --------------------------------------
- -------------------------------- --------------------------------------
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The undersigned hereby irrevocably elects to exercise the right of purchase
represented by the within Warrant for, and to purchase thereunder,
_______________ shares of the stock provided for therein, and tenders herewith
payment of the purchase price in full in the form of cash or by cashier's check
in the amount of $______________.
The undersigned requests that certificates for such shares be issued in the
name of:
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- -------------------------------------------------------------------------
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(Please Print Name, Address and Social Security No.)
DATED: __________________
Name of Warrant holder or Permitted Assignee:
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Address:
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Signature:____________________________________________________________
Signature Guaranteed:Note: The above signature must correspond with the name
as written upon the face of this Warrant in every
particular, without alteration or enlargement or
any change whatever, unless this Warrant has been
assigned.
- 18 -
Exhibit 8
CARTER, LEDYARD & MILBURN
COUNSELLORS AT LAW
2 WALL STREET
NEW YORK, N.Y. 10005-2072
-----------
(212) 732-3200
FAX (212) 732-3232
July 17, 2000
Avnet, Inc.
2211 South 47th Street
Phoenix, AZ 85034
Re: Form S-3 Registration Statement
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Ladies and Gentlemen:
We have acted as counsel to Avnet, Inc. (the "Company"), in connection with
the proposed offer and sale of up to 388,186 shares of Common Stock of the
Company (the "Shares") in connection with the Company's acquisition by merger,
on July 3, 2000, of Savoir Technology Group, Inc. ("Savoir"). The offer and sale
of the Shares are the subject of Post-Effective Amendment No.1 (the "Amendment")
to the Registration Statement (Registration No. 333-36970) filed by the Company
for the acquisition of Savoir.
We have examined originals or copies, certified or otherwise identified to
our satisfaction, of all such agreements, certificates and other statements of
corporate officers and other representatives of the Company as we have deemed
necessary as a basis for this opinion. In such examination we have assumed the
genuineness of all signatures and the authenticity of all documents submitted to
us as originals and the conformity with the originals of all documents submitted
to us as copies.
Based on and subject to the foregoing, we are of the opinion that the
section entitled "Federal Income Tax Considerations" in the Amendment contains
an accurate general description, under currently applicable law, of the
principal United States federal income tax considerations that apply to
purchasers of the Shares.
We consent to the filing of this opinion as an Exhibit to the Amendment. In
giving this consent we do not acknowledge that we come within the category of
persons whose consent is required by the Securities Act or the rules and
regulations promulgated thereunder.
Very truly yours,
/s/ Carter, Ledyard & Milburn
Exhibit 23(a)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to (1) the incorporation by
reference in this Registration Statement on Form S-3 (File No. 333-36970,
Post-Effective Amendment No. 1) of our report dated August 4, 1999, included in
Avnet, Inc.'s Annual Report on Form 10-K for the year ended July 2, 1999, (2)
the incorporation by reference in this Registration Statement on Form S-3 of our
report dated August 25, 1999, on the consolidated financial statements of
Marshall Industries, which report is included in Avnet, Inc.'s Current Report on
Form 8-K bearing cover date of October 20, 1999 and (3) all references to our
firm included in this Registration Statement.
Phoenix, Arizona ARTHUR ANDERSEN LLP
July 14, 2000