WARRANT AGREEMENT

Exhibit 4.4

 

WARRANT AGREEMENT

Between

LOUISIANA-PACIFIC CORPORATION

and

COMPUTERSHARE TRUST COMPANY, N.A.

as

Warrant Agent

 

Dated as of March 10, 2009

 

TABLE OF CONTENTS

 

 

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TABLE OF CONTENTS

(continued)

 

 

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WARRANT AGREEMENT (the “ Agreement ”), dated as of March 10, 2009, between LOUISIANA-PACIFIC CORPORATION, a Delaware corporation (together with any successors and assigns, the “ Company ”), and COMPUTERSHARE TRUST COMPANY, N.A., a banking corporation and trust company organized under the laws of the United States, as warrant agent (with any successor warrant agent, the “ Warrant Agent ”).

A. Pursuant to a purchase agreement (the “ Purchase Agreement ”) dated March 3, 2009 among the Company, the Guarantors named therein, Banc of America Securities LLC, Goldman, Sachs & Co. and RBC Capital Markets Corporation, as representatives of the Initial Purchasers named in the Purchase Agreement, the Company has agreed to sell to the Initial Purchasers 375,000 units (the “ Units ”), each consisting of (i) $1,000 principal amount at maturity of 13% Senior Secured Notes due 2017 (the “ Notes ”) of the Company and (ii) one warrant (collectively, the “ Warrants ”), each Warrant initially entitling the Holder (as defined herein) thereof to purchase 49.0559 shares of Common Stock (as defined herein) of the Company, on the terms and subject to the conditions set forth herein, at the Exercise Price (as defined herein).

B. The Holders of the Warrants are entitled to the benefits of a Warrant Registration Rights Agreement dated as of March 10, 2009 by and among the Company and the Initial Purchasers (the “ Warrant Registration Rights Agreement ”).

C. The Company desires the Warrant Agent as warrant agent to assist the Company in connection with the issuance, exchange, cancellation, replacement and exercise of the Warrants, and in this Agreement wishes to set forth, among other things, the terms and conditions on which the Warrants may be issued, exchanged, canceled, replaced and exercised.

NOW, THEREFORE, in consideration of the premises and mutual agreements herein, the Company and the Warrant Agent hereby agree as follows:

Defined terms used in this Agreement shall, unless the context otherwise requires, have the meanings specified below. Certain additional terms are set forth elsewhere in this Agreement. Any reference to any section of applicable law shall be deemed to include successor provisions thereto.

“ Affiliate ” has the meaning given to it in the Indenture.

“ Agreement ” has the meaning given to it in the preamble above.

“ Board of Directors ” means the board of directors of the Company or any duly authorized committee thereof.

“ Business Day ” means any day that is not a Saturday, Sunday or a day on which banking institutions in New York are authorized or required by law to be closed.

“ Capital Stock ” means, with respect to any Person, any and all shares, interests, participations, rights in or other equivalents (however designated and whether voting or non-voting) of such Person’s capital stock, whether outstanding on the Issue Date or issued after the Issue Date, and any and all rights (other than any evidence of indebtedness), warrants or options exchangeable for or convertible into such capital stock.

“ Cashless Exercise Ratio ” has the meaning given to it in Section 7.

“ Certificated Warrant ” means a definitive warrant in registered form.

“ class ” means, when referring to any Capital Stock, any class or series of such Capital Stock.

“ Clearstream ” means Clearstream Banking, Societe Anonyme, Luxembourg.

“ Common Stock ” means the Common Stock of the Company, par value $1.00 per share.

“ Company ” has the meaning given to it in the preamble above.

“ Daily Exercise Value ” means, with respect to any Trading Day, 1/20th of the Volume Weighted Average Price per share of the Common Stock on such Trading Day.

“ Depositary ” has the meaning given to it in Section 2.

“ Direct Participant ” means, with respect to the Depositary (as defined in Section 2), Euroclear or Clearstream, a Person who has an account with the Depositary, Euroclear or Clearstream, respectively (and, with respect to The Depository Trust Company, shall include Euroclear and Clearstream).

“ DTC ” has the meaning given to it in Section 2.

“ Election to Exercise ” has the meaning given to it in Section 7.

“ Euroclear ” means Morgan Guaranty Trust Company of New York, Brussels office, as operator of the Euroclear System.

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.

“ Exercise Date ” with respect to a Warrant means the date on which the Holder of the Warrant has complied with all requirements described in Section 7 for exercising such Warrant.

“ Exercise Price ” has the meaning given to it in Section 7.

“ Exercise Rate ” has the meaning given to it in Section 13.

“ Exercise Reference Period ” means the period of 20 consecutive Trading Days ending on the Trading Day immediately preceding the Exercise Date.

“ Exercise Value ” means the sum of the Daily Exercise Values for each of the 20 consecutive trading days of the applicable Exercise Reference Period.

“ Expiration Date ” means March 15, 2017.

 

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“ Fundamental Transaction ” has the meaning given to it in Section 13.

“ Global Shares ” has the meaning given to it in Section 7.

“ Global Warrants ” has the meaning given to it in Section 2.

“ Guarantor ” has the meaning given to it in the Indenture.

“ Holders ” has the meaning given to it in Section 4.

“ Indenture ” means the indenture dated as of March 10, 2009 between the Company and the Trustee, relating to the Notes.

“ Indirect Participant ” means a person who holds a beneficial interest in a Global Warrant (as defined in Section 2) through a Direct Participant.

“ Initial Purchasers ” means Banc of America Securities LLC, Goldman, Sachs & Co., and RBC Capital Markets Corporation.

“ Institutional Accredited Investor ” has the meaning given to it in Section 6.

“ Issue Date ” means March 10, 2009.

“ Last Reported Sale Price ” means, for the Common Stock on any date, the closing sale price per share (or if no closing sale price is reported, the average of the bid and ask prices or, if more than one in either case, the average of the average bid and the average ask prices) on that date as reported in composite transactions for the principal U.S. national or regional securities exchange on which the Common Stock is listed for trading. If the Common Stock is not listed for trading on a U.S. national or regional securities exchange on the relevant date, then the “Last Reported Sale Price” will be the last quoted bid price for the Common Stock in the over-the-counter market on the relevant date as reported by the National Quotation Bureau or similar organization. If the Common Stock is not so quoted, the “Last Reported Sale Price” will be the average of the mid-point of the last bid and ask prices for the Common Stock on the relevant date from each of at least three nationally recognized independent investment banking firms selected by the Company for this purpose.

“ Liquidating Distribution ” has the meaning given to it in Section 13.

“ Market Disruption Event ” means (a) a failure by the primary exchange or quotation system on which the Common Stock trades or is quoted, as the case may be, to open for trading during its regular trading session or (b) the occurrence or existence prior to 1:00 p.m., New York City time, on any Trading Day for an aggregate one-half hour period of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the stock exchange or otherwise) in the Common Stock or in any options, contracts or future contracts relating to the Common Stock.

“ Notes ” has the meaning given to it in the preamble above.

 

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“ Officers’ Certificate ” means a certificate signed by two officers of the Company, one of whom must be the principal executive officer, principal financial officer or principal accounting officer.

“ Person ” means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

“ Private Placement Legend ” has the meaning given to it in Section 6(h).

“ Purchase Agreement ” has the meaning given to it in the preamble above.

“ QIB ” has the meaning given to it in Section 6.

“ Rule 144A ” has the meaning given to it in Section 6.

“ SEC ” means the Securities and Exchange Commission.

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Separation Date ” means the earlier to occur of (i) 180 days after the Issue Date and (ii) such date as Banc of America Securities LLC in its sole discretion shall determine.

“ Share Purchase Rights ” means any rights to purchase capital stock of any Person pursuant to a customary “poison pill” rights plan, including without limitation the rights plan established pursuant to the Rights Agreement, dated as of May 23, 2008, between the Company and Computershare Trust Company, N.A., as rights agent, and any successor or replacement rights plan containing substantially similar terms.

“ Trading Day ” is any day on which trading in the Common Stock generally occurs and there is no Market Disruption Event.

“ Transfer Agent ” has the meaning given to it in Section 11.

“ Trustee ” means The Bank of New York Mellon Trust Company, N.A., the trustee under the Indenture.

“ Units ” has the meaning given to it in the preamble above.

“ Volume Weighted Average Price ” per share of Common Stock on any Trading Day means the per share volume-weighted average price on The New York Stock Exchange as displayed under the heading “Bloomberg VWAP” on Bloomberg page “LPX<equity>VAP” (or any successor page thereto) in respect of the period from the scheduled open of trading until the scheduled close of trading on the primary trading session on such trading day (or if such volume-weighted average price is unavailable, the market value of one share of the Common Stock on such Trading Day as determined in a commercially reasonable manner by the Board of Directors using a volume-weighted method) and will be determined without regard to after hours trading or any other trading outside of the regular trading session.

 

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“ Warrants ” has the meaning given to it in the preamble above.

“ Warrant Agent ” has the meaning given to it in the preamble above.

“ Warrant Certificates ” has the meaning given to it in Section 2.

“ Warrantholders ” has the meaning given to it in Section 4.

“ Warrant Registration Rights Agreement ” has the meaning given to it in the preamble above.

“ Warrant Register ” has the meaning given to it in Section 4.

“ Warrant Shares ” means the shares of Common Stock issuable upon exercise of Warrants from time to time.

SECTION 1. Appointment of Warrant Agent . The Company hereby appoints the Warrant Agent to act as agent for the Company in accordance with the instructions hereinafter set forth in this Agreement, and the Warrant Agent hereby accepts such appointment.

SECTION 2. Warrant Certificates . The certificates representing the Warrants (“ Warrant Certificates ”) will initially be issued in the form of one or more registered global warrants (the “ Global Warrants ”) substantially in the form of Exhibit A attached hereto, which shall be deposited with the Warrant Agent, as custodian for the Depositary (as defined below), and registered in the name of DTC (as defined below) or the nominee of DTC for credit to the accounts of DTC’s Direct and Indirect Participants. Any Global Warrants to be delivered pursuant to this Agreement shall bear the legend set forth in Exhibit B(1) attached hereto. The Global Warrants shall represent such of the outstanding Warrants as shall be specified therein, and each Global Warrant shall provide that it shall represent the aggregate amount of outstanding Warrants from time to time endorsed thereon and that the aggregate amount of outstanding Warrants represented thereby may from time to time be reduced or increased, as appropriate. Any endorsement of a Global Warrant to reflect the amount of any increase or decrease in the amount of outstanding Warrants represented thereby shall be made by the Warrant Agent and the Depositary in accordance with instructions given by the Holder thereof. The Depository Trust Company (“ DTC ”) shall act as the “Depositary” with respect to the Global Warrants until a successor shall be appointed by the Company and the Warrant Agent. Certificated Warrants will only be issued if (a) DTC notifies the Company that DTC is no longer willing or able to act as a depositary for the Global Warrants and the Company is unable to locate a qualified successor within 90 days, or (b) DTC notifies the Company that DTC has ceased to be a clearing agency registered under the Exchange Act.

SECTION 3. Execution of Warrant Certificates . Warrant Certificates shall be signed on behalf of the Company by its Chairman of the Board, President, Chief Executive Officer, a Vice President, Treasurer, an Assistant Treasurer or Chief Financial Officer and by a Vice President, its Secretary or an Assistant Secretary. Each such signature upon the Warrant Certificates may be in the form of a facsimile signature of any such present or future officer and may be imprinted or otherwise reproduced on the Warrant Certificates.

 

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In case any officer of the Company who shall have signed any of the Warrant Certificates shall cease to be such officer before the Warrant Certificates so signed shall have been countersigned by the Warrant Agent, or disposed of by the Company, such Warrant Certificates nevertheless may be countersigned and delivered or disposed of as though such person had not ceased to be such officer of the Company; and any Warrant Certificate may be signed on behalf of the Company by any person who, at the actual date of the execution of such Warrant Certificate, shall be a proper officer of the Company to sign such Warrant Certificate, although at the date of the execution of this Warrant Agreement any such person was not such officer.

Warrant Certificates shall be dated the date of countersignature by the Warrant Agent.

SECTION 4. Registration and Countersignature . The Warrants shall be numbered and shall be registered on the books of the Company maintained at the principal office of the Warrant Agent in Canton, Massachusetts (the “ Warrant Register ”) as they are issued.

Warrant Certificates shall be manually countersigned by the Warrant Agent and shall not be valid for any purpose unless so countersigned. The Warrant Agent shall, upon written instructions of the Chairman of the Board, the President, Chief Executive Officer, a Vice President, the Treasurer, an Assistant Treasurer, Chief Financial Officer, Secretary or an Assistant Secretary of the Company, initially countersign and deliver Warrants entitling the Holders thereof to purchase not more than the number of Warrant Shares referred to above in the first recital hereof and shall thereafter countersign and deliver Warrants as otherwise provided in this Agreement.

The Company and the Warrant Agent may deem and treat the registered holders (the “ Holders ” or “ Warrantholders ”) of the Warrant Certificates as the absolute owners thereof (notwithstanding any notation of ownership or other writing thereon made by anyone) for all purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.

SECTION 5. Transfer and Exchange of Warrants . The Warrant Agent shall from time to time, subject to the limitations of Section 6, register the transfer of any outstanding Warrants upon the records to be maintained by it for that purpose, upon surrender thereof duly endorsed or accompanied (if so required by it) by a written instrument or instruments of transfer in form satisfactory to the Warrant Agent, duly executed by the registered Holder or Holders thereof or by the duly appointed legal representative thereof or by a duly authorized attorney. Subject to the terms of this Agreement, each Warrant Certificate may be exchanged for another certificate or certificates entitling the Holder thereof to purchase a like aggregate number of Warrant Shares as the certificate or certificates surrendered then entitle each Holder to purchase. Any Holder desiring to exchange a Warrant Certificate or Certificates shall make such request in writing delivered to the Warrant Agent, and shall surrender, duly endorsed or accompanied (if so required by the Warrant Agent) by a written instrument or instruments of transfer in form satisfactory to the Warrant Agent, the Warrant Certificate or Certificates to be so exchanged.

Upon registration of transfer, the Company shall execute and the Warrant Agent shall countersign and deliver by certified mail a new Warrant Certificate or Certificates to the persons entitled thereto. The Warrant Certificates may be exchanged at the option of the Holder thereof,

 

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when surrendered at the office or agency of the Company maintained for such purpose, which initially will be the principal office of the Warrant Agent in Canton, Massachusetts for another Warrant Certificate, or other Warrant Certificates of different denominations, of like tenor and representing in the aggregate the right to purchase a like number of Warrant Shares.

No service charge shall be made for any exchange or registration of transfer of Warrant Certificates, but the Company may require payment of a sum sufficient to cover any stamp or other tax or other governmental charge that is imposed in connection with any such exchange or registration of transfer.

SECTION 6. Registration of Transfers and Exchanges .

(a) Transfer and Exchange of Warrants . When Warrants are presented to the Warrant Agent with a request:

(i) to register the transfer of the Warrants; or

(ii) to exchange such Warrants for an equal number of Warrants of other authorized denominations,

the Warrant Agent shall register the transfer or make the exchange as requested if (and may refuse to register any transfer or exchange unless) the requirements under this Agreement as set forth in this Section 6 for such transactions are met; provided, however, that the Warrants presented or surrendered for registration of transfer or exchange:

 

(x)

shall be duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Company and the Warrant Agent, duly executed by the Holder thereof or by his or her representative, duly authorized in writing, and affixed with a signature guarantee from a guarantor participating in a medallion signature guarantee program approved by the Securities Transfer Association; and

 

(y)

unless the Private Placement Legend has been removed from the certificate evidencing such Warrants, such Warrants shall be accompanied, in the sole discretion of the Company, by the following additional information and documents, as applicable, it being understood, however, that the Warrant Agent need not determine which clause (A) through (F) below is applicable:

 

(A)

if such Warrant is being delivered to the Warrant Agent by a Holder for registration in the name of such Holder, without transfer, a certification from such Holder to that effect (in substantially the form of Exhibit C hereto); or

 

(B)

if such Warrant is being transferred to a qualified institutional buyer (as defined in Rule 144A under the Securities Act (“ Rule 144A ”)) (a “ QIB ”) in accordance with Rule 144A under the Securities Act, a certification to that effect (in substantially the form of Exhibit C hereto); or

 

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(C)

if such Warrant is being transferred to an institutional accredited investor within the meaning of subparagraph (a)(1), (a)(2), (a)(3) or (a)(7) of Rule 501 under the Securities Act (an “ Institutional Accredited Investor ”), delivery by the transferor of a certification to that effect (in substantially the form of Exhibit C hereto), and delivery of a Transferee Letter of Representation in connection with Transfers to Institutional Accredited Investors (in substantially the form of Exhibit D hereto) and an opinion of counsel and/or other information reasonably acceptable to the Company and the Warrant Agent to the effect that such transfer is in compliance with the Securities Act; or

 

(D)

if such Warrant is being transferred in reliance on Regulation S under the Securities Act, delivery by the transferor of a certification to that effect (in substantially the form of Exhibit C hereto), and a Transferee Letter of Representation in connection with Transfers pursuant to Regulation S in the form of Exhibit E hereto; or

 

(E)

if such Warrant is being transferred in reliance on Rule 144 under the Securities Act, delivery by the transferor of (i) a certification from the transferor to that effect (in substantially the form of Exhibit C hereto), and (ii) an opinion of counsel reasonably satisfactory to the Company and the Warrant Agent to the effect that such transfer is in compliance with the Securities Act; or

 

(F)

if such Warrant is being transferred in reliance on another exemption from the registration requirements of the Securities Act, a certification to that effect from the transferee or transferor (in substantially the form of Exhibit C hereto), and an opinion of counsel from the transferee or transferor reasonably acceptable to the Company and the Warrant Agent to the effect that such transfer is in compliance with the Securities Act.

(b) Exchange or Transfer of a Certificated Warrant for a Beneficial Interest in a Global Warrant . A Certificated Warrant may not be exchanged (including in connection with any transfer of a Warrant) by a Holder for a beneficial interest in a Global Warrant except upon satisfaction of the requirements set forth below. Upon receipt by the Warrant Agent of a Certificated Warrant, duly endorsed or accompanied by appropriate instruments of transfer, in form satisfactory to the Warrant Agent, together with:

(i) unless the Private Placement Legend has been removed from the certificate evidencing the Warrants, certification from such Holder (in substantially the form of Exhibit C hereto) that such Holder is a QIB or that such Certificated Warrant is being transferred to a QIB in accordance with Rule 144A under the Securities Act; and

 

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(ii) written instructions directing the Warrant Agent to make, or to direct the Depositary to make, an endorsement on the Global Warrant to reflect an increase in the aggregate amount of the Warrants represented by the Global Warrant,

then the Warrant Agent shall cancel such Certificated Warrant and cause, or direct the Depositary to cause, in accordance with the standing instructions and procedures existing between the Depositary and the Warrant Agent, the number of Warrants represented by the Global Warrant to be increased accordingly. If no Global Warrant is then outstanding, the Company shall issue and the Warrant Agent shall upon written instructions from the Company authenticate a new Global Warrant in the appropriate amount.

(c) Transfer or Exchange of Beneficial Interests in Global Warrants . The transfer or exchange of beneficial interests in Global Warrants shall be effected through the Depositary, in accordance with this Section 6, the Private Placement Legend, the other provisions of this Agreement (including the restrictions on transfer set forth herein) and the procedures of the Depositary therefor.

(d) Transfer or Exchange of a Beneficial Interest in a Global Warrant for a Certificated Warrant .

(i) Subject in all cases to the provisions of Section 2, any Person having a beneficial interest in a Global Warrant may exchange (including any exchange in connection with any transfer of a Warrant) such beneficial interest for a Certificated Warrant upon receipt by the Warrant Agent of written instructions or such other form of instructions as is customary for the Depositary from the Depositary or its nominee on behalf of any Person having a beneficial interest in a Global Warrant, including a written order containing registration instructions and, unless the Private Placement Legend has been removed from the certificate evidencing such Global Warrants, the following additional information and documents:

 

(A)

if such beneficial interest is being exchanged by the Person designated by the Depositary as being the beneficial owner, a certification from such Person to that effect (in substantially the form of Exhibit C); or

 

(B)

if such beneficial interest is being transferred to a QIB in accordance with Rule 144A under the Securities Act, a certification from the transferor to that effect (in substantially the form of Exhibit C); or

 

(C)

if such beneficial interest is being transferred to an Institutional Accredited Investor, delivery by the transferor of a certification to that effect (in substantially the form of

 

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Exhibit C hereto), and delivery of a Transferee Letter of Representation in connection with Transfers to Institutional Accredited Investors to that effect (in substantially the form of Exhibit D) and an opinion of counsel and/or other information reasonably acceptable to the Company and the Warrant Agent to the effect that such transfer is in compliance with the Securities Act; or

 

(D)

if such beneficial interest is being transferred in reliance on Regulation S under the Securities Act, delivery of (i) a certification to that effect (in substantially the form of Exhibit C hereto) and (ii) a Transferee Letter of Representation in connection with Transfers pursuant to Regulation S in the form of Exhibit E hereto; or

 

(E)

if such beneficial interest is being transferred in reliance on Rule 144 under the Securities Act, delivery by the transferor of (i) a certification to that effect (in substantially the form of Exhibit C hereto) and (ii) an opinion of counsel reasonably satisfactory to the Company and the Warrant Agent to the effect that such transfer is in compliance with the Securities Act; or

 

(F)

if such beneficial interest is being transferred in reliance on another exemption from the registration requirements of the Securities Act, a certification to that effect from the transferee or transferor (in substantially the form of Exhibit C hereto) and an opinion of counsel and/or other information reasonably acceptable to the Company and the Warrant Agent to the effect that such transfer is in compliance with the Securities Act (if such transfer is made specifically pursuant to Regulation S, the transferor must also deliver a Letter of Representation in connection with Transfers pursuant to Regulation S in substantially the form of Exhibit E hereto).

In connection with any such transfer or exchange, Warrant Agent will cause, in accordance with the standing instructions and procedures existing between the Depositary and the Warrant Agent, the aggregate amount of the Global Warrant to be reduced accordingly and, following such reduction, the Company will execute and, upon receipt of a countersignature order in the form of an Officers’ Certificate, the Warrant Agent will countersign and deliver to the transferee a Certificated Warrant.

(ii) Certificated Warrants issued in exchange for or in connection with a transfer of a beneficial interest in a Global Warrant pursuant to this Section 6 shall be registered in such names and in such authorized denominations as the Depositary, pursuant to instructions from its Direct or Indirect Participants or otherwise, shall instruct

 

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the Warrant Agent in writing. The Warrant Agent shall deliver such Certificated Warrants to the Persons in whose names such Warrants are so registered and adjust the Global Warrant pursuant to paragraph (g) of this Section 6.

(e) Restrictions on Transfer or Exchange of Global Warrants . Notwithstanding any other provisions of this Agreement (other than the provisions set forth in subsection (f) of this Section 6), a Global Warrant may not be transferred or exchanged as a whole except by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary.

(f) Countersignature of Certificated Warrants in Absence of Depositary . If at any time:

(i) the Depositary for the Global Warrants notifies the Company that the Depositary is no longer willing or able to act as a depositary for the Global Warrants and the Company is unable to locate a qualified successor within 90 days; or

(ii) the Depositary for the Global Warrants notifies the Company that it has ceased to be a clearing agency registered under the Exchange Act, as amended,

then the Company will execute, and the Warrant Agent will, upon receipt of an Officers’ Certificate requesting the countersignature and delivery of Certificated Warrants, countersign and deliver Certificated Warrants in an aggregate number equal to the aggregate number of Warrants represented by the Global Warrant in exchange for such Global Warrant.

(g) Cancellation or Adjustment of a Global Warrant . At such time as all beneficial interests in a Global Warrant have either been exchanged for Certificated Warrants, redeemed, repurchased or canceled, such Global Warrant shall be returned to the Company or, upon written order to the Warrant Agent in the form of an Officers’ Certificate from the Company, retained and canceled by the Warrant Agent. At any time prior to such cancellation, if any beneficial interest in a Global Warrant is exchanged for Certificated Warrants, redeemed, repurchased or canceled, the number of Warrants represented by such Global Warrant shall be reduced accordingly and an endorsement shall be made on such Global Warrant by the Warrant Agent to reflect such reduction.

(h) Legends .

(i) Private Placement Legend . Except as provided below, each Warrant Certificate evidencing the Warrants (and all Warrants issued in exchange therefor or substitution thereof and, if the Company deems appropriate, Warrant Shares issuable upon exercise of the Warrants) shall bear a legend substantially to the effect set forth in Exhibit A (the “Private Placement Legend”). Upon any sale or transfer of a Warrant or Warrant Share pursuant to Rule 144 under the Securities Act in accordance with this Section 6 or under an effective registration statement under the Securities Act, the Warrant Agent shall permit the Holder of a Warrant to exchange such Warrant for a Warrant and the Company shall permit the holder of a Warrant Share to exchange such Warrant Share for a share of Common Stock, in each case, that does not bear the Private

 

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Placement Legend, provided that, in the case of a sale or transfer pursuant to Rule 144 under the Securities Act, an opinion of the Company or of counsel to the Company is tendered therewith indicating that there are no impediments to the removal of such Private Placement Legend under the applicable federal securities laws of the United States.

(ii) Unit Legend . Each Warrant issued prior to the Separation Date shall bear a legend substantially to the effect set forth in Exhibit B(2).

(i) Obligations with Respect to Transfers and Exchanges of Certificated Warrants and Global Warrants .

(i) To permit registrations of transfers and exchanges, the Company shall execute, at the Warrant Agent’s request, and the Warrant Agent shall authenticate Certificated Warrants and Global Warrants.

(ii) All Certificated Warrants and Global Warrants issued upon any registration, transfer or exchange of Certificated Warrants and Global Warrants shall be the valid obligations of the Company, entitled to the same benefits under this Agreement as the Certificated Warrants and Global Warrants surrendered upon the registration of transfer or exchange.

(iii) Prior to due presentment for registration of transfer of any Warrant, the Warrant Agent and the Company may deem and treat the Person in whose name any Warrant is registered as the absolute owner of such Warrant, and neither the Warrant Agent nor the Company shall be affected by notice to the contrary.

SECTION 7. Terms of Warrants; Exercise of Warrants . Subject to the terms of this Agreement, each Holder of Warrants shall have the right, which may be exercised commencing on or after the Separation Date and until 5:00 p.m., New York City time, on the Expiration Date, to receive from the Company upon the delivery of written notice, which may be provided via e-mail or facsimile, the number of fully paid and nonassessable Warrant Shares which the holder may at the time be entitled to receive on exercise of such Warrants and payment of the Exercise Price (as defined below) for such Warrant Shares. Each Warrant not exercised prior to 5:00 p.m., New York City time, on the Expiration Date shall become void and all rights thereunder and all rights in respect thereof under this Agreement shall cease as of such time. No adjustments in respect of dividends, interest or other income on or from any Warrant Share (or any other securities, property or other consideration for which a Warrant may become exercisable in accordance with this Agreement) will be made during the term of a Warrant or upon exercise of a Warrant.

The price per share at which Warrant Shares shall be purchasable upon exercise of Warrants (the “ Exercise Price ”) shall be equal to $1.39, subject to adjustment pursuant to Section 13. A Warrant may be exercised upon surrender at the office or agency of the Company maintained for such purpose, which initially will be the principal office of the Warrant Agent in Canton, Massachusetts of the Warrant Certificate or Certificates evidencing the Warrants to be exercised with the form of election to purchase on the reverse thereof (the “ Election to Exercise ”)

 

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properly completed and signed, which signature shall be guaranteed in accordance with the provisions set forth in the Warrant Certificate, together with payment of the Exercise Price. Payment of the Exercise Price shall be made only by the surrender of one or more Warrants (and without the payment of the Exercise Price in cash) in exchange for a number of shares of the Company’s Common Stock equal to the product of (a) the number of shares of the Company’s Common Stock for which such Warrant or Warrants are exercisable as of the Exercise Date (determined as if the Exercise Price were being paid in cash), and (b) the Cashless Exercise Ratio. The “ Cashless Exercise Ratio ” shall equal a fraction, (i) the numerator of which is the excess of (A) the Exercise Value per share of Common Stock for the applicable Exercise Reference Period over (B) the Exercise Price as of the Exercise Date and (ii) the denominator of which is the Exercise Value per share of Common Stock for such Exercise Reference Period. Upon surrender of a Warrant Certificate representing more than one Warrant, the number of shares of Common Stock deliverable shall be equal to the product of (x) the number of shares of the Company’s Common Stock issuable in respect of those Warrants that the Holder specifies are to be exercised multiplied by (y) the Cashless Exercise Ratio. All provisions of this Agreement are applicable with respect to an exercise of a Warrant Certificate for less than the full number of Warrants represented thereby.

The “ Exercise Date ” for a Warrant shall be the date when all of the items referred to in the immediately preceding paragraph are received by the Warrant Agent at or prior to 11:00 a.m., New York City time, on a Business Day and the exercise of the Warrants will be effective as of such Exercise Date. If any items referred to in such paragraph are received after 11:00 a.m., New York City time, on a Business Day, the exercise of the Warrants to which such item relates will be effective on the next succeeding Business Day. Notwithstanding the foregoing, in the case of an exercise of Warrants on the Expiration Date, if all of the items referred to in such paragraph are received by the Warrant Agent at or prior to 5:00 p.m., New York City time, on the Expiration Date, the exercise of the Warrants to which such items relate will be effective on the Expiration Date.

Within three Trading Days after the Exercise Date, subject to the provisions of Section 6 hereof, the Company shall issue and cause to be delivered 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 Warrant Shares issuable upon the exercise of such Warrants. 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 Exercise Date. At the election of the Company with the consent of the holder of record of the relevant Warrant Shares, Warrant Shares may initially be issued in global form (the “ Global Shares ”). Such Global Shares shall represent such of the outstanding Warrant Shares as shall be specified therein and each Global Share shall provide that it represents the aggregate amount of outstanding Warrant Shares from time to time endorsed thereon and that the aggregate amount of outstanding Warrant Shares represented thereby may from time to time be reduced or increased, as appropriate. Any endorsement of a Global Share to reflect any increase or decrease in the amount of outstanding Warrant Shares represented thereby shall be made by the registrar for the Warrant Shares and the Depositary (referred to below) in accordance with instructions given by the holder thereof. DTC shall (if possible) act as the Depositary with respect to the Global Shares until a successor shall be appointed by the Company and the registrar for the Warrant Shares.

 

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Each Warrant shall be exercisable only in whole. In the event that a certificate evidencing Warrants is exercised in respect of fewer than all of the Warrants evidenced thereby at any time prior to the Expiration Date, a new certificate evidencing the remaining Warrant or Warrants will be issued, and the Warrant Agent is irrevocably authorized to countersign and to deliver the required new Warrant Certificate or Certificates pursuant to this Agreement, and the Company, whenever required by the Warrant Agent, will promptly supply the Warrant Agent with Warrant Certificates duly executed on behalf of the Company for such purpose. Holders of Warrants will be able to exercise their Warrants only if a registration statement relating to the Warrant Shares underlying the Warrants is then in effect, or the exercise of such Warrants is exempt from the registration requirements of the Securities Act, and such securities are qualified for sale or exempt from qualification under the applicable securities laws of the states in which the various Holders of Warrants or other persons to whom it is proposed that Warrant Shares be issued on exercise of the Warrants reside.

All Warrant Certificates surrendered upon exercise of Warrants shall be canceled by the Warrant Agent. Such canceled Warrant Certificates shall then be disposed of by the Warrant Agent in a manner consistent with the Warrant Agent’s customary procedure for such disposal and in a manner reasonably satisfactory to the Company. The Warrant Agent shall account promptly to the Company with respect to Warrants exercised.

The Warrant Agent shall keep copies of this Agreement and any notices given or received hereunder available for inspection by the Holders during normal business hours at its office. The Company shall supply the Warrant Agent from time to time with such numbers of copies of this Agreement as the Warrant Agent may request.

SECTION 8. Payment of Taxes . The Company will pay all documentary stamp taxes attributable to the initial issuance of Warrant Shares upon the exercise of 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 of any Warrant Certificates or any certificates for Warrant Shares in a name other than that of the registered Holder of a Warrant Certificate surrendered upon the exercise of a Warrant, and the Company shall not be required to issue or deliver such Warrant Certificates unless or until the Person or Persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

SECTION 9. Rule 144A . The Company covenants that it will file the reports required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder in a timely manner (including any extensions permitted by Rule 12b-25 of the Exchange Act (or any successor rule or regulation)) in accordance with the requirements of the Securities Act and the Exchange Act and, if at any time the Company is not required to file such reports, it will, upon the request of any Holder or beneficial owner of Warrants, make available such information necessary to permit sales pursuant to Rule 144A under the Securities Act.

SECTION 10. Mutilated or Missing Warrant Certificates . In case any of the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the Company may at its discretion issue and the Warrant Agent may countersign, in exchange and substitution for and

 

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upon cancellation of the mutilated Warrant Certificate, or in lieu of and substitution for the Warrant Certificate lost, stolen or destroyed, a new Warrant Certificate of like tenor and representing an equivalent number of Warrants, but only upon receipt of evidence satisfactory to the Company and the Warrant Agent of such loss, theft or destruction of such Warrant Certificate and indemnity also satisfactory to them, which indemnity shall include a corporate bond of indemnity satisfactory in form and substance to the Company and the Warrant Agent.

SECTION 11. Reservation of Warrant Shares . The Company will at all times authorize and reserve and keep available, free from preemptive rights and free from all taxes, liens, charges and security interests, out of the aggregate of its authorized but unissued Common Stock or its authorized and issued Common Stock held in its treasury, for the purpose of enabling it to satisfy its obligation to issue Warrant Shares upon exercise of Warrants, the maximum number of shares of Common Stock which may then be deliverable upon the exercise of all outstanding Warrants.

The Company or, if appointed, the transfer agent for the Common Stock (the “ Transfer Agent ”) and every subsequent transfer agent for any shares of the Company’s Capital Stock issuable upon the exercise of Warrants will be irrevocably authorized and directed at all times to reserve such number of authorized shares as shall be required 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 Warrants. The Warrant Agent is hereby irrevocably authorized to (1) instruct such Transfer Agent to make the appropriate book entries and (2) requisition from time to time from such Transfer Agent the stock certificates, if any, required to honor outstanding Warrants upon exercise thereof, in each case in accordance with the terms of this Agreement. The Company will supply such Transfer Agent with duly executed certificates for such purposes, if necessary, and will provide or otherwise make available any cash which may be payable as provided in Section 14. The Company will furnish such Transfer Agent a copy of all notices of adjustments and certificates related thereto transmitted to each Holder pursuant to Section 15 hereof.

The Company covenants that all Warrant Shares which may be issued upon exercise of Warrants made in accordance with the terms of this Agreement will, upon issuance, be duly and validly authorized and issued, fully paid, nonassessable, free of preemptive rights and free from all taxes, liens, charges and security interests with respect to the issuance thereof. The Company will take no action to increase the par value of the Common Stock to an amount in excess of the Exercise Price, and the Company will not enter into any agreements inconsistent with the rights of Holders hereunder. The Company will use its reasonable best efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof as may be necessary to enable the Company to perform its obligations under this Agreement.

SECTION 12. Obtaining Stock Exchange Listings . The Company will from time to time use commercially reasonable efforts to ensure that the Warrant Shares, immediately upon their issuance upon the exercise of Warrants, will be listed on the principal securities exchanges and markets within the United States of America, if any, on which the Company’s Common Stock is then listed. In the event that, at any time during the period in which the Warrants are exercisable, the Common Stock is not listed on any principal securities exchanges

 

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