Exhibit 10.5

 

 

WARRANT AGREEMENT

 

Dated as of

 

October 5, 2016

 

between

 

ARCH COAL, INC.

 

and

 

AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC,

 

as Warrant Agent

 

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For 1,914,856 Series A Warrants

 

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Table of Contents

 

 

 

 

 

Page

 

 

 

 

 

ARTICLE I

 

DEFINITIONS

 

Section 1.01.

 

Definitions

 

1

Section 1.02.

 

Other Definitions

 

3

Section 1.03.

 

Rules of Construction

 

3

 

 

 

 

 

ARTICLE II

 

WARRANTS

 

Section 2.01.

 

Form

 

4

Section 2.02.

 

Execution and Countersignature

 

5

Section 2.03.

 

Registry

 

6

Section 2.04.

 

Transfer and Exchange

 

6

Section 2.05.

 

Definitive Warrants

 

8

Section 2.06.

 

Replacement Certificates

 

9

Section 2.07.

 

Outstanding Warrants

 

9

Section 2.08.

 

Cancellation

 

10

Section 2.09.

 

CUSIP Numbers

 

10

Section 2.10.

 

Withholding and Reporting Requirements

 

10

Section 2.11.

 

Proxies

 

11

 

 

 

 

 

ARTICLE III

 

EXERCISE TERMS

 

Section 3.01.

 

Exercise

 

11

Section 3.02.

 

Manner of Exercise and Issuance of Shares

 

11

Section 3.03.

 

Covenants Relating to Common Stock Issuable Upon Warrant Exercise

 

11

Section 3.04.

 

Exercise Calculations

 

11

 

 

 

 

 

ARTICLE IV

 

ANTIDILUTION PROVISIONS

 

Section 4.01.

 

Antidilution Adjustments; Notice of Adjustment

 

12

Section 4.02.

 

Adjustment to Warrant Certificate

 

12

 

 

 

 

 

ARTICLE V

 

WARRANT AGENT

 

Section 5.01.

 

Appointment of Warrant Agent

 

12

 

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Section 5.02.

 

Rights and Duties of Warrant Agent

 

13

Section 5.03.

 

Individual Rights of Warrant Agent

 

14

Section 5.04.

 

Warrant Agent’s Disclaimer

 

14

Section 5.05.

 

Compensation and Indemnity

 

15

Section 5.06.

 

Successor Warrant Agent

 

15

Section 5.07.

 

Representations of the Company

 

17

 

 

 

 

 

ARTICLE VI

 

MISCELLANEOUS

 

Section 6.01.

 

Persons Benefitting

 

17

Section 6.02.

 

Amendment

 

18

Section 6.03.

 

Notices

 

19

Section 6.04.

 

Governing Law

 

20

Section 6.05.

 

Successors

 

20

Section 6.06.

 

Multiple Originals; Counterparts

 

20

Section 6.07.

 

Inspection of Agreement

 

20

Section 6.08.

 

Table of Contents

 

20

Section 6.09.

 

Severability

 

20

Section 6.10.

 

Customer Identification Program

 

21

Section 6.11.

 

Confidentiality

 

21

Section 6.12.

 

Force Majeure

 

21

 

 

 

 

 

EXHIBIT A

 

Form of Series A Warrant

 

 

 

ii

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This WARRANT AGREEMENT is dated as of October 5, 2016 (this “Agreement”), among
Arch Coal, Inc., a Delaware corporation (the “Company”), and American Stock
Transfer & Trust Company, LLC, a New York limited liability trust company, as
Warrant Agent (the “Warrant Agent”).  All terms used but not defined in this
Agreement shall have the respective meanings assigned to them in the form of
Warrant Certificate attached to this Agreement as Exhibit A.

 

Pursuant to the Debtors’ Fourth Amended Joint Plan of Reorganization under
Chapter 11 of the Bankruptcy Code, as confirmed by the United States Bankruptcy
Court for the Eastern District of Missouri on September 13, 2016, the Company
hereby issues warrants (the “Warrants”) to purchase initially 1,914,856 shares
of Class A Common Stock, $0.01 par value per share, of the Company (the “Common
Stock”), subject to Section 13(G) of each Warrant Certificate.

 

The Warrants will be substantially in the form attached hereto as Exhibit A.

 

Each Warrant entitles the registered holder thereof (the “Holder”) to receive,
upon exercise thereof, a number of shares of Common Stock determined by the
provisions of the relevant Warrant Certificate.  Each Warrant Certificate
(including any Global Warrant) shall evidence such number of Warrants as is set
forth therein, subject to adjustment pursuant to the provisions of the Warrant
Certificate.

 

The Warrants and the shares of Common Stock issuable upon exercise of the
Warrants will be freely transferable by Holders that are not Affiliates of the
Company, subject to any applicable restrictions in the relevant Warrant
Certificate.  The Company desires the Warrant Agent to act on behalf of the
Company in connection with the registration, transfer, exchange, exercise and
cancellation of the Warrants as provided in this Agreement and the Warrant
Certificates, and the Warrant Agent is willing to so act.

 

Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the Holders of Warrants:

 

ARTICLE I

 

DEFINITIONS

 

Section 1.01.                          Definitions.

 

“Affiliate” means, with respect to any Person, any Person directly or indirectly
controlling, controlled by or under common control with, such other Person.  For
purposes of this definition, “control” (including, with correlative meanings,
the terms “controlled by” and “under common control with”) when used with
respect to any Person, means the possession, directly or indirectly, of the
power to cause the direction of management and/or policies of such Person,
whether through the ownership of voting securities by contract or otherwise.

 

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“Agent Members” means the securities brokers and dealers, banks and trust
companies, clearing organizations and other similar organizations that are
participants in the Depositary’s system.

 

“Business Day” means any day except Saturday, Sunday and any day on which
banking institutions in the State of New York are authorized or required by law
or other governmental actions to close.

 

“Custodian” means American Stock Transfer & Trust Company, LLC, as custodian for
the Depositary, or any successor thereto.

 

“Definitive Warrant” means a Warrant Certificate in definitive form that is not
deposited with the Depositary or with the Custodian.

 

“Depositary” means The Depository Trust Company, its nominees and their
respective successors.

 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, or
any successor statute, and the rules and regulations promulgated thereunder.

 

“Exercise Period” has the meaning set forth in the form of Warrant Certificate
attached as Exhibit A hereto.

 

“Exercise Price” has the meaning set forth in the form of Warrant Certificate
attached as Exhibit A hereto.

 

“Officer” means the Chairman of the Board, President, Chief Executive Officer,
Chief Operating Officer, Chief Financial Officer, General Counsel, Treasurer and
Secretary of the Company, any Assistant Treasurer or any Assistant Secretary of
the Company, and any Executive or Senior Vice President or any Vice President
(whether or not designated by a number or numbers or word or words added before
or after the title “Vice President”) of the Company.

 

“Officer’s Certificate” means a certificate signed by any Officer.

 

“Opinion of Counsel” means a written opinion from legal counsel who is
acceptable to the Warrant Agent, in its sole discretion.  Such counsel may be an
employee of or counsel to the Company or the Warrant Agent.

 

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

 

“Shares” has the meaning set forth in the form of Warrant Certificate attached
as Exhibit A hereto.

 

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“Warrant Certificate” means any registered certificate (including a Global
Warrant) issued by the Company and authenticated by the Warrant Agent under this
Agreement evidencing Warrants, in the form attached as Exhibit A hereto.

 

“Warrant Share Number” has the meaning set forth in the form of Warrant
Certificate attached as Exhibit A hereto.

 

Section 1.02.                          Other Definitions.

 

Term

 

Defined in
Section

 

 

 

“Agreement”

 

Recitals

“Company”

 

Recitals

“Common Stock”

 

Recitals

“Customer Identification Program”

 

6.10

“Global Warrant”

 

2.01(a)

“Holder” or “Holders”

 

Recitals

“Loss” or “Losses”

 

5.05(b)

“Registry”

 

2.03

“Warrant”

 

Recitals

“Warrant Agent”

 

Recitals

 

Section 1.03.                          Rules of Construction.

 

Unless the text otherwise requires:

 

(a)         a defined term has the meaning assigned to it;

 

(b)         an accounting term not otherwise defined has the meaning assigned to
it in accordance with United States generally accepted accounting principles as
in effect on the date hereof;

 

(c)          “or” is not exclusive;

 

(d)         “including” means including, without limitation; and

 

(e)          words in the singular include the plural and words in the plural
include the singular.

 

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ARTICLE II

 

WARRANTS

 

Section 2.01.                          Form.

 

(a)         Global Warrants.  Except as provided in Section 2.04 or 2.05,
Warrants, including Warrants issued upon any transfer or exchange thereof, shall
be issued in the form of one or more permanent global Warrants in fully
registered form with the global securities legend set forth in the form of
Warrant Certificate attached as Exhibit A hereto (each, a “Global Warrant”),
which shall be deposited on behalf of the Company with the Depositary (or, at
the direction of the Depositary, with the Custodian or such other custodian as
the Depositary may direct), and registered in the name of the Depositary or a
nominee of the Depositary, duly executed by the Company and countersigned by the
Warrant Agent as hereinafter provided.

 

(b)         Book-Entry Provisions. This Section 2.01(b) shall apply only to a
Global Warrant deposited with, at the direction of or on behalf of the
Depositary.

 

(i)                                     The Company shall execute and the
Warrant Agent shall, in accordance with Section 2.02, countersign, either by
manual or facsimile signature, and deliver one or more Global Warrants that
(A) shall be registered in the name of the Depositary or the nominee of the
Depositary and (B) shall be delivered by the Warrant Agent to the Depositary or
pursuant to the Depositary’s instructions or held by the Custodian.  Each Global
Warrant shall be dated the date of its countersignature by the Warrant Agent.

 

(ii)                                  Agent Members shall have no rights under
this Agreement with respect to any Global Warrant held on their behalf by the
Depositary or by the Warrant Agent as the custodian of the Depositary or under
such Global Warrant except to the extent set forth herein or in a Warrant
Certificate, and the Depositary may be treated by the Company, the Warrant Agent
and any agent of the Company or the Warrant Agent as the absolute owner of such
Global Warrant for all purposes whatsoever.  Notwithstanding the foregoing,
nothing herein shall (A) prevent the Company, the Warrant Agent or any agent of
the Company or the Warrant Agent from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or
(B) impair, as between the Depositary and the Agent Members, the operation of
customary practices of the Depositary governing the exercise of the rights of a
holder of a beneficial interest in any Global Warrant.  The rights of beneficial
owners in a Global Warrant shall be exercised through the Depositary subject to
the applicable procedures of the Depositary except to the extent set forth
herein or in a Warrant Certificate.

 

(c)          Definitive Securities.  Except as provided in Section 2.04 or 2.05,
owners of beneficial interests in Global Warrants will not be entitled to
receive physical delivery of Definitive Warrants.

 

(d)         Warrant Certificates.  Warrant Certificates shall be in
substantially the form attached as Exhibit A hereto and shall be typed, printed,
lithographed or engraved or produced

 

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by any combination of such methods or produced in any other manner permitted by
the rules of any securities exchange on which the Warrants may be listed, all as
determined by the Officer or Officers executing such Warrant Certificates, as
evidenced by their execution thereof.  Any Warrant Certificate shall have such
insertions as are required by this Agreement and may have such letters, numbers
or other marks of identification and such legends and endorsements, stamped,
printed, lithographed or engraved thereon, (i) as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement
(and which letters, numbers, marks of identification, legends or endorsements do
not affect the rights, duties, immunities or obligations of the Warrant Agent),
(ii) as may be required to comply with this Agreement, any applicable law or any
rule of any securities exchange on which the Warrants may be listed, or (iii) as
may be necessary to conform to customary usage.

 

Section 2.02.                          Execution and Countersignature.

 

(a)         Execution by the Company.  At least one Officer shall sign the
Warrant Certificates for the Company by manual or facsimile signature.  If an
Officer whose signature is on a Warrant Certificate no longer holds that office
at the time the Warrant Agent countersigns the Warrant Certificate, the Warrants
evidenced by such Warrant Certificate shall be valid nevertheless.

 

(b)         Countersignature by the Warrant Agent.  The Warrant Agent shall
initially countersign, either by manual or facsimile signature, and deliver
Warrant Certificates evidencing, in the aggregate, 1,914,856 Warrants.  Each
Warrant Certificate shall be dated the date of its countersignature by the
Warrant Agent.

 

(c)          Subsequent Issue of Warrant Certificates.  At any time and from
time to time after the execution of this Agreement, the Warrant Agent shall upon
receipt of a written order of the Company signed by an Officer countersign, by
either manual or facsimile signature, and issue a Warrant Certificate evidencing
the number of Warrants specified in such order; provided that the Warrant Agent
shall be entitled to receive, in connection with such countersignature of
Warrants described in this Section 2.02(c), an Officer’s Certificate and an
Opinion of Counsel of the Company to the effect that issuance and execution of
such Warrants is authorized or permitted by this Agreement and the
organizational documents of the Company.  Such written order of the Company
shall specify the number of Warrants to be evidenced on the Warrant Certificate
to be countersigned, the date on which such Warrant Certificate is to be
countersigned and the number of Warrants then authorized.  Each Warrant
Certificate shall be dated the date of its countersignature by the Warrant
Agent.

 

(d)         Validity of Warrant Certificates.  The Warrants evidenced by a
Warrant Certificate shall not be valid until an authorized signatory of the
Warrant Agent countersigns the Warrant Certificate either manually or by
facsimile signature. Such signature shall be solely for the purpose of
authenticating the Warrant Certificate and shall be conclusive evidence that the
Warrant Certificate so countersigned has been duly authenticated and issued
under this Agreement.  Countersigned Warrant Certificates may be delivered,
notwithstanding the fact that the persons or any one of them who countersigned
the Warrants shall have ceased to be proper

 

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signatories prior to the delivery of such Warrants or were not proper
signatories on the date of this Agreement.

 

Section 2.03.                          Registry.

 

The Warrants shall be issued in registered form only.  The Warrant Agent shall
keep a registry (the “Registry”) of the Warrant Certificates and of their
transfer and exchange. The Registry shall show the names and addresses of the
respective Holders and the date and number of Warrants evidenced on the face of
each of the Warrant Certificates, and record all exchanges, exercise,
cancellation and transfers of the Warrants. The Holder of any Global Warrant
will be the Depositary or a nominee of the Depositary in whose name such Global
Warrant is registered.  The Warrant holdings of Agent Members will be recorded
on the books of the Depositary.  The beneficial interests in any Global Warrant
held by customers of Agent Members will be reflected on the books and records of
such Agent Members and will not be known to the Warrant Agent, to the Company or
to the Depositary.  Any Warrant Certificate may be surrendered for transfer,
cancellation, exchange or exercise, in accordance with its terms, at the office
of the Warrant Agent designated for such purpose.  The Company and the Warrant
Agent may deem and treat any Person in whose name a Warrant Certificate is
registered in the Registry as the absolute owner of such Warrant Certificate for
all purposes whatsoever and neither the Company nor the Warrant Agent shall be
affected by notice to the contrary.

 

Section 2.04.                          Transfer and Exchange.

 

(a)         Transfer and Exchange of Global Warrants.

 

(i)                                     The transfer and exchange of Global
Warrants or beneficial interests therein shall be effected through the
book-entry system maintained by the Depositary, in accordance with this
Agreement and the Warrant Certificates and the procedures of the Depositary
therefor.

 

(ii)                                  Notwithstanding any other provisions of
this Agreement (other than the provisions set forth in Section 2.05), a Global
Warrant may only be transferred as a whole, and not in part, and only by (A) the
Depositary, to a nominee of the Depositary, (B) a nominee of the Depositary, to
the Depositary or another nominee of the Depositary, or (C) the Depositary or
any such nominee to a successor Depositary or its nominee.

 

(iii)                               In the event that a Global Warrant is
exchanged and transferred for Definitive Warrants pursuant to Section 2.05, such
Warrants may be exchanged only in accordance with Section 9 of the Warrant
Certificate and such procedures as are substantially consistent with the
provisions of this Section 2.04 and the requirements of any Warrant Certificate
and such other procedures as may from time to time be adopted by the Company
that are not inconsistent with the terms of this Agreement or of any Warrant
Certificate.

 

(b)         Cancellation or Adjustment of Global Warrant.  At such time as all
beneficial interests in a Global Warrant have been exchanged for Definitive
Warrants, repurchased,

 

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exercised or canceled, such Global Warrant shall be returned by the Depositary
for cancellation or retained and canceled by the Warrant Agent. At any time
prior to such cancellation, if any beneficial interest in a Global Warrant is
exchanged (including, without limitation, for Definitive Warrants and/or New
Warrants), repurchased, exercised or canceled, the number of Warrants
represented by such Global Warrant shall be reduced and the Warrant Agent shall
make an adjustment on its books and records to reflect such reduction; provided
that, in the case of an adjustment on account of an exercise of Warrants, the
Warrant Agent shall have no duty or obligation to make such adjustment until it
has received notice from the Holder of the amount thereof.

 

(c)          Obligations with Respect to Transfers and Exchanges of Warrants.

 

(i)                                     To permit registrations of transfers and
exchanges, the Company shall execute and the Warrant Agent shall countersign,
either by manual or facsimile signature, Global Warrants and Definitive Warrants
as required pursuant to the provisions of Section 2.02 and this Section 2.04. A
transferor of a Global Warrant or a Definitive Warrant shall deliver to the
Warrant Agent a written instruction of transfer in the form attached to the
relevant Warrant Certificate as Annex C, duly executed by the Holder thereof or
by its attorney, duly authorized in writing. Additionally, prior to registration
of any transfer or exchange of a Warrant, the requirements for the Warrant
issued upon such transfer or exchange to be issued in a name other than the
registered Holder shall be met. Such requirements include, inter alia, a
signature guarantee from an eligible guarantor institution participating in a
signature guarantee program approved by the Securities Transfer Association (at
a guarantee level reasonably acceptable to the Company’s transfer agent), and
any other reasonable evidence of authority that may be required by the Warrant
Agent. Upon satisfaction of the conditions in this clause (i), the Warrant Agent
shall, in accordance with such instructions, register the transfer or exchange
of the relevant Global Warrant or Definitive Warrant.

 

(ii)                                  No service charge shall be made to a
Holder for any registration of transfer or exchange, but the Company may require
payment from a Holder of a sum sufficient to cover any transfer tax, assessments
or similar governmental charge payable in connection therewith as set forth in
the Warrant Certificate. The Warrant Agent shall have no duty or obligation
pursuant to any Section of this Agreement requiring the payment of taxes,
assessments, and/or governmental charges unless and until the Warrant Agent is
satisfied that all such taxes, assessments, and/or governmental charges have
been paid.

 

(iii)                               All Warrants issued upon any transfer or
exchange pursuant to the terms of this Agreement shall be the valid obligations
of the Company, entitled to the same benefits under this Agreement as the
Warrants surrendered upon such transfer or exchange.

 

(d)         No Obligation of the Warrant Agent.

 

(i)                                     The Warrant Agent shall have no
responsibility or obligation to any beneficial owner of a Global Warrant, any
Agent Member or other Person with

 

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respect to the accuracy of the records of the Depositary or its nominee or of
any participant or member thereof, with respect to any ownership interest in the
Warrants or with respect to the delivery to any Agent Member, beneficial owner
or other Person (other than the Depositary) of any notice or the payment of any
amount, under or with respect to such Warrants.  All notices and communications
to be given to the Holders and all payments to be made to Holders under the
Warrants shall be given or made only to or upon the order of the registered
Holders (which shall be the Depositary or its nominee in the case of a Global
Warrant).  Except as set forth in the Warrant Certificate, the rights of
beneficial owners in any Global Warrant shall be exercised only through the
Depositary subject to the applicable rules and procedures of the Depositary. 
The Warrant Agent may rely and shall be fully protected in relying upon
information furnished by the Depositary with respect to its members,
participants and any beneficial owners.

 

(ii)                                  The Warrant Agent shall have no obligation
or duty to monitor, determine or inquire as to compliance with any restrictions
on transfer imposed under this Agreement or under applicable law with respect to
any transfer of any interest in any Warrant (including any transfer between or
among the Agent Members or beneficial owners in any Global Warrant) other than
to require delivery of such certificates and other documentation or evidence as
are expressly required by, and to do so if and when expressly required by, the
terms of this Agreement and the Warrant Certificate, and to examine the same to
determine substantial compliance as to form with the express requirements hereof
and thereof.

 

Section 2.05.                          Definitive Warrants.

 

(a)         Issuance of Definitive Warrants.  Beneficial interests in a Global
Warrant deposited with the Depositary or with the Custodian pursuant to
Section 2.01 shall be transferred to each beneficial owner thereof in the form
of Definitive Warrants evidencing a number of Warrants equivalent to such
owner’s beneficial interest in such Global Warrant, in exchange for such Global
Warrant, only if such transfer complies with Section 2.04 and (i) the Depositary
notifies the Company that it is unwilling or unable to continue as Depositary
for such Global Warrant or if at any time the Depositary ceases to be a
“clearing agency” registered under the Exchange Act and, in each such case, a
successor Depositary is not appointed by the Company within 90 days of such
notice, (ii) the Company, in its sole discretion, notifies the Warrant Agent in
writing that it elects to cause the issuance of Definitive Warrants under this
Agreement in accordance with the applicable rules and procedures of the
Depositary, or (iii) the Company shall be adjudged a bankrupt or insolvent or
make an assignment for the benefit of its creditors or institute proceedings to
be adjudicated a bankrupt or shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent seeking
reorganization under federal bankruptcy laws or any other similar applicable
federal or state law, or shall consent to the filing of any such petition, or
shall consent to the appointment of a receiver or custodian of all or any
substantial part of its property, or shall admit in writing its inability to pay
or meet its debts as they mature, or if a receiver or custodian of it or all or
any substantial part of its property shall be appointed, or if a public officer
shall have taken charge or control of the Company or of its property or affairs,
for the purpose of rehabilitation, conservation or liquidation.

 

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(b)         Surrender of Global Warrants and Exchange for Definitive Warrants. 
Any Global Warrant that is to be exchanged, in whole or in part, for Definitive
Warrants pursuant to this Section 2.05 shall be surrendered by the Depositary to
the Warrant Agent, to be so exchanged, in whole or from time to time in part,
without charge, and the Warrant Agent shall countersign, either by manual or
facsimile signature, and deliver to each beneficial owner of such Global Warrant
(or, in the case of clause (ii) in Section 2.05(a), to each beneficial owner
requesting such an exchange) in the name of such beneficial owner, Definitive
Warrants evidencing a number of Warrants equivalent to such beneficial owner’s
beneficial interest in the Global Warrant.  The Warrant Agent shall register
such exchange in the Registry, and if the entire Global Warrant has been
exchanged for Definitive Warrants the surrendered Global Warrant shall be
canceled by the Warrant Agent.

 

(c)          Validity of Definitive Warrants.  All Definitive Warrants issued
upon transfer pursuant to this Section 2.05 shall be the valid obligations of
the Company, evidencing the same obligations of the Company and entitled to the
same benefits under this Agreement as the Global Warrant surrendered upon such
transfer.

 

(d)         Definitive Warrant Certificates.  In the event of the occurrence of
any of the events specified in Section 2.05(a), the Company will promptly make
available to the Warrant Agent a reasonable supply of Definitive Warrants in
definitive, fully registered form.

 

(e)          No Liability.  Neither the Company nor the Warrant Agent will be
liable or responsible for any registration or transfer of any Warrants that are
registered or to be registered in the name of a fiduciary or the nominee of a
fiduciary.

 

Section 2.06.                          Replacement Certificates.

 

If a mutilated Warrant Certificate is surrendered to the Warrant Agent or if the
Holder of a Warrant Certificate provides evidence reasonably satisfactory to the
Company and the Warrant Agent that the Warrant Certificate has been lost,
destroyed or wrongfully taken, the Company shall issue and the Warrant Agent
shall countersign, by either manual or facsimile signature, a replacement
Warrant Certificate of like tenor and representing an equivalent number of
Warrants, if the reasonable requirements of the Warrant Agent and Section 8-405
of the Uniform Commercial Code as in effect in the State of New York are met. 
In the case of the Warrant Certificate that is lost, destroyed or wrongfully
taken, if required by the Warrant Agent or the Company, such Holder shall
furnish an indemnity sufficient in the judgment of the Company and the Warrant
Agent to protect the Company and the Warrant Agent from any loss that either of
them may suffer if a Warrant Certificate is replaced.  The Company and the
Warrant Agent may charge the Holder for their reasonable, out-of-pocket expenses
in replacing a Warrant Certificate prior to issuing and delivering a replacement
Warrant Certificate to such Holder.  Every replacement Warrant Certificate
evidences an additional obligation of the Company.

 

Section 2.07.                          Outstanding Warrants.

 

Subject to Section 6.02, the Warrants outstanding at any time are all Warrants
evidenced on all Warrant Certificates authenticated by the Warrant Agent except
for those

 

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canceled by it and those delivered to it for cancellation.  The Company shall
not sell, and shall use commercially reasonable efforts to prevent any Affiliate
of the Company from selling, any Warrant if the Warrant would constitute a
“restricted security” (within the meaning of Rule 144 under the Securities Act)
upon such resale.

 

If a Warrant Certificate is replaced pursuant to Section 2.06, the Warrants
evidenced thereby cease to be outstanding unless the Warrant Agent and the
Company receive proof satisfactory to them that the replaced Warrant Certificate
is held by a bona fide purchaser.

 

Section 2.08.                          Cancellation.

 

In the event the Company shall purchase or otherwise acquire Definitive
Warrants, the same shall thereupon be delivered to the Warrant Agent for
cancellation.

 

The Warrant Agent and no one else shall cancel and destroy all Warrant
Certificates surrendered for transfer, exchange, replacement, exercise or
cancellation and deliver a certificate of such destruction to the Company unless
the Company directs the Warrant Agent to deliver any canceled Warrant
Certificates to the Company.  The Company may not issue new Warrant Certificates
to replace Warrant Certificates to the extent they evidence Warrants that have
been exercised or Warrants that the Company has purchased or otherwise acquired.

 

Section 2.09.                          CUSIP Numbers.

 

In issuing the Warrants, the Company may use CUSIP numbers (if then generally in
use) and, if so, the Warrant Agent shall use CUSIP numbers in notices as a
convenience to Holders; provided that any such notice may state that no
representation is made as to the correctness of such CUSIP numbers either as
printed on the Warrant Certificates or as contained in any notice and that
reliance may be placed only on the other identification numbers printed on the
Warrant Certificates.

 

Section 2.10.                          Withholding and Reporting Requirements.

 

The Company shall comply with all applicable tax withholding and reporting
requirements imposed by any governmental unit, and all distributions, including
deemed distributions, pursuant to the Warrants will be subject to applicable
withholding and reporting requirements.  Notwithstanding any provision to the
contrary, the Company will be authorized to (i) take any actions that may be
necessary or appropriate to comply with such withholding and reporting
requirements, (ii) apply a portion of any cash distribution to be made under the
Warrants to pay applicable withholding taxes, (iii) liquidate a portion of any
non-cash distribution to be made under the Warrants to generate sufficient funds
to pay applicable withholding taxes or (iv) establish any other mechanisms the
Company believes are reasonable and appropriate, including requiring Holders to
submit appropriate tax and withholding certifications (such as IRS Forms W-9 and
the appropriate IRS Forms W-8, as applicable) and/or requiring Holders to pay
the withholding tax amount to the Company in cash as a condition of receiving
the benefit of any antidilution adjustment pursuant to Article IV.

 

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Section 2.11.                          Proxies.

 

The registered Holder of a Global Warrant may grant proxies and otherwise
authorize any Person, including Agent Members and Persons that may hold
beneficial interests through Agent Members, to take any action that a Holder is
entitled to take under this Agreement or the Warrants.

 

ARTICLE III

 

EXERCISE TERMS

 

Section 3.01.                          Exercise.

 

The Exercise Price of each Warrant, the Warrant Share Number, the number of
Warrants evidenced by any Warrant Certificate and the Exercise Period of each
Warrant shall be set forth in the related Warrant Certificate. The Exercise
Price of each Warrant and the Warrant Share Number are subject to adjustment
pursuant to the terms set forth in the Warrant Certificate.

 

Section 3.02.                          Manner of Exercise and Issuance of
Shares.

 

Warrants may be exercised in the manner set forth in Sections 3 and 4 of the
Warrant Certificate, and upon any such exercise, if any Shares are issuable
pursuant to Section 4 of the Warrant Certificate, such Shares shall be issued in
the manner set forth in Section 5 of the Warrant Certificate.

 

Section 3.03.                          Covenants Relating to Common Stock
Issuable Upon Warrant Exercise.

 

(a)         Common Stock Certificates.  The Warrant Agent is hereby authorized
to request from time to time from any stock transfer agents of the Company those
stock certificates required to honor outstanding Warrants upon exercise thereof
in accordance with the terms of this Agreement and the applicable Warrant
Certificate, and the Company agrees to authorize and direct such transfer agents
to comply with all such requests of the Warrant Agent. The Company shall supply
such transfer agents with duly executed stock certificates for such purposes and
shall provide or otherwise make available any cash that may be payable upon
exercise of Warrants as provided herein and in each Warrant Certificate.

 

(b)         Common Stock Reserve.  The Company hereby confirms that it
previously has authorized and instructed its transfer agent and registrar for
the Common Stock to create a special account for the reserve of a number of
shares of Common Stock equal to the aggregate Warrant Share Number for all
outstanding Warrants to be issued upon exercise of the Warrants, and such
reserve account shall be maintained until the earlier of (1) the latest
Expiration Time of any Warrant and (2) the time at which all Warrants have been
canceled.

 

Section 3.04.                          Exercise Calculations.

 

To the extent applicable, the Company shall calculate and transmit to the
Warrant Agent, and the Warrant Agent shall have no obligation under this
Agreement to calculate, the number of Shares deliverable pursuant to any
exercise of Warrants. The number of Shares to be

 

11

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issued on such exercise will be determined by the Company (with written notice
thereof to the Warrant Agent) as set forth in the Warrant Certificate. The
Warrant Agent shall have no duty or obligation to investigate or confirm whether
the Company’s determination of the number of Shares to be issued on such
exercise is accurate or correct.

 

ARTICLE IV

 

ANTIDILUTION PROVISIONS

 

Section 4.01.                          Antidilution Adjustments; Notice of
Adjustment.

 

The Exercise Price and the Warrant Share Number shall be subject to adjustment
from time to time as provided in Section 13 of the Warrant Certificate. 
Whenever the Exercise Price or the Warrant Share Number is so adjusted or is
proposed to be adjusted as provided in Section 13 of the Warrant Certificate,
the Company shall deliver to the Warrant Agent the notices or statements, and
shall cause a copy of such notices or statements to be sent or communicated to
each Holder pursuant to Section 6.03, as provided in Section 13(M) of the
Warrant Certificate.

 

Section 4.02.                          Adjustment to Warrant Certificate.

 

The form of Warrant Certificate need not be changed because of any adjustment
made pursuant to the Warrant Certificate (except as expressly provided in
Section 13(G) of the Warrant Certificate), and Warrant Certificates issued after
such adjustment may state the same Exercise Price and the same Warrant Share
Number as are stated in the Warrant Certificates initially issued pursuant to
this Agreement. The Company, however, may at any time in its sole discretion
make any ministerial change in the form of Warrant Certificate that it may deem
appropriate to give effect to such adjustments and that does not affect the
substance of the Warrant Certificate, and any Warrant Certificate thereafter
issued or countersigned, whether in exchange or substitution for an outstanding
Warrant Certificate or otherwise, may be in the form as so changed.  In the
event of any such change, the Company shall give prompt notice thereof to all
registered Holders and, if appropriate, notation thereof shall be made on all
Warrant Certificates thereafter surrendered for registration of transfer or
exchange.

 

ARTICLE V

 

WARRANT AGENT

 

Section 5.01.                          Appointment of Warrant Agent.

 

The Company hereby appoints the Warrant Agent to act as agent for the Company in
accordance with the provisions of this Agreement and the Warrant Agent hereby
accepts such appointment.  The Warrant Agent shall not be liable for anything
that it may do or refrain from doing in connection with this Agreement, except
for its own gross negligence, willful misconduct, fraud or bad faith.
Notwithstanding anything in this Agreement to the contrary, in no event shall
the Warrant Agent be liable for special, punitive, incidental, indirect or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits),

 

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even if the Warrant Agent has been advised of the likelihood of such loss or
damage and regardless of the form of the action. The rights and obligations of
the parties set forth in this Section 5.01 shall survive the termination of this
Agreement and the resignation, replacement or removal of the Warrant Agent.

 

Section 5.02.                          Rights and Duties of Warrant Agent.

 

(a)         Agent for the Company.  In acting under this Warrant Agreement and
in connection with the Warrant Certificates, the Warrant Agent is acting solely
as agent of the Company and does not assume any obligation of agency or trust or
any relationship of agency or trust for or with any of the holders of Warrant
Certificates or beneficial owners of Warrants.

 

(b)         Counsel.  The Warrant Agent may consult with counsel reasonably
satisfactory to it, and the advice of such counsel shall be full and complete
authorization and protection to the Warrant Agent in respect of any action
taken, suffered or omitted by it hereunder in good faith and in accordance with
the advice of such counsel.

 

(c)          Documents.  The Warrant Agent shall be protected and shall incur no
liability for or in respect of any action taken or thing suffered by it, absent
gross negligence, willful misconduct or bad faith, in reliance upon any Warrant
Certificate, notice, direction, consent, certificate, affidavit, statement or
other paper or document reasonably believed by it to be genuine and to have been
presented or signed by the proper officers or other parties of the Company.  The
Warrant Agent shall not take any instructions or directions except those given
in accordance with this Agreement.

 

(d)         No Implied Obligations.  The Warrant Agent shall be obligated to
perform only such duties as are specifically set forth herein and in the Warrant
Certificates, and no implied or inferred duties, responsibility or obligations
of the Warrant Agent shall be read into this Agreement or the Warrant
Certificates against the Warrant Agent. The Warrant Agent shall not be under any
obligation to take any action hereunder that may cause it to incur any expense
or liability for which it does not receive indemnity if such indemnity is
reasonably requested.  The Warrant Agent shall not be accountable or under any
duty or responsibility for the use by the Company of any of the Warrant
Certificates countersigned by the Warrant Agent and delivered by it to the
Holders or on behalf of the Holders pursuant to this Agreement or for the
application by the Company of the proceeds of the Warrants.  The Warrant Agent
shall have no duty or responsibility in the case of any default by the Company
in the performance of its covenants or agreements contained herein or in the
Warrant Certificates or in the case of the receipt of any written demand from a
Holder with respect to such default, including any duty or responsibility to
initiate or attempt to initiate any proceedings at law or otherwise. The Warrant
Agent shall have no duty or responsibility to ensure compliance with any
applicable federal or state securities law in connection with the issuance,
transfer or exchange of any Warrants under this Agreement.

 

(e)          Not Responsible for Adjustments or Validity of Stock. The Warrant
Agent shall not at any time be under any duty or responsibility to any Holder to
determine whether any facts exist that may require an adjustment of the Warrant
Share Number or the Exercise Price or to calculate any such adjustment, or to
make any determination with respect to the nature or extent of any adjustment
when made, or with respect to the method employed, herein or in any

 

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supplemental agreement provided to be employed, in making the same.  The Warrant
Agent shall not be accountable with respect to the validity or value of any
Shares or of any securities or property that may at any time be issued or
delivered upon the exercise of any Warrant or upon any adjustment pursuant to
Section 13 of the Warrant Certificate, and it makes no representation with
respect thereto.  The Warrant Agent shall not be responsible for any failure of
the Company to make any cash payment or to issue, transfer or deliver any Shares
or stock certificates upon the surrender of any Warrant Certificate for the
purpose of exercise or upon any adjustment pursuant to Section 13 of the Warrant
Certificate, or to comply with any of the covenants of the Company contained in
the Warrant Certificate or this Agreement.

 

(f)           Notices or Demands Addressed to the Company.  If the Warrant Agent
receives any notice or demand addressed to the Company by the Holder of a
Warrant, the Warrant Agent shall promptly forward such notice or demand to the
Company.

 

(g)          Ambiguity.  In the event the Warrant Agent reasonably believes any
ambiguity or uncertainty exists hereunder or in any Warrant Certificate, notice,
instruction, direction, request or other communication, paper or document
received by the Warrant Agent hereunder, the Warrant Agent shall notify the
Company in writing as soon as practicable, and upon delivery of such notice may,
in its sole discretion, refrain from taking any action, and shall be fully
protected and shall not be liable in any way to the Company or any Holder or
other Person for refraining from taking such action, unless the Warrant Agent
receives written instructions signed by the Company which eliminate such
ambiguity or uncertainty to the reasonable satisfaction of the Warrant Agent.
Notwithstanding anything in this Agreement to the contrary, the Warrant Agent is
authorized and directed hereby to comply with any orders, judgments, or decrees
of any court that it believes has jurisdiction over it and, absent gross
negligence, willful misconduct, fraud or bad faith, will not be liable as a
result of its compliance with the same.

 

Section 5.03.                          Individual Rights of Warrant Agent.

 

Subject to its obligations hereunder, the Warrant Agent and any stockholder,
director, officer or employee of the Warrant Agent may buy, sell or deal in any
of the Warrants or other securities of the Company or its affiliates or become
pecuniarily interested in transactions in which the Company or its affiliates
may be interested, or contract with or lend money to the Company or its
affiliates or otherwise act as fully and freely as though it were not the
Warrant Agent under this Agreement. Nothing herein shall preclude the Warrant
Agent from acting in any other capacity for the Company or for any other legal
entity.

 

Section 5.04.                          Warrant Agent’s Disclaimer.

 

The Warrant Agent shall not be responsible for, and makes no representation as
to the validity or adequacy of, this Agreement (except the due and valid
authorized execution and delivery of this Agreement by the Warrant Agent) or the
Warrant Certificates (except the due countersignature of the Warrant
Certificate(s) by the Warrant Agent) and it shall not be responsible for any
statement in this Agreement or the Warrant Certificates other than its
countersignature thereon; nor will the Warrant Agent be under any duty or
responsibility to

 

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insure compliance with any applicable federal or state securities laws in
connection with the issuance, transfer or exchange of Warrant Certificates.

 

Section 5.05.                          Compensation and Indemnity.

 

(a)         Compensation of Warrant Agent.  The Company agrees to pay the
Warrant Agent the compensation to be agreed upon with the Company for all
services rendered by the Warrant Agent under this Agreement and to reimburse the
Warrant Agent upon request for all reasonable out-of-pocket expenses, including
the reasonable and documented counsel fees and expenses, incurred by the Warrant
Agent in connection with the preparation, delivery, administration, execution
and amendment of this Agreement and the performance of the services rendered by
the Warrant Agent under this Agreement. The Company is not obligated to
reimburse any expense incurred by the Warrant Agent through gross negligence,
willful misconduct, fraud or bad faith.

 

(b)         Indemnification by the Company.  The Company shall indemnify and
hold harmless the Warrant Agent and its officers and directors against any loss,
liability or expense (including reasonable attorneys’ fees and expenses)
incurred by it (each, a “Loss” and, collectively, “Losses”) without gross
negligence, willful misconduct, fraud or bad faith on its part arising out of or
in connection with the acceptance, administration, exercise or performance of
its duties under this Agreement. The Company shall further indemnify and hold
the Warrant Agent harmless from and against any Loss arising out of or
attributable to the Warrant Agent’s acting on the written instructions of the
Company, so long as the Warrant Agent so acted without gross negligence, willful
misconduct, fraud or bad faith. The Warrant Agent shall notify the Company
promptly of any claim for which it may seek indemnity. The costs and expenses
incurred by the Warrant Agent in successfully enforcing its right of
indemnification hereunder shall be paid by the Company. The Company is not
obligated to indemnify the Warrant Agent against any loss or liability incurred
by the Warrant Agent through willful misconduct, gross negligence, fraud or bad
faith. The rights and obligations of the parties set forth in Sections
5.05(a) and (b) shall survive the termination of this Agreement and the
resignation, replacement or removal of the Warrant Agent.

 

Section 5.06.                          Successor Warrant Agent.

 

(a)         Company to Provide and Maintain Warrant Agent.  The Company agrees
for the benefit of the Holders that there shall at all times be a Warrant Agent
hereunder until all the Warrants have been exercised or canceled or are no
longer exercisable.

 

(b)         Resignation and Removal.  The Warrant Agent may at any time resign
by giving written notice to the Company of such intention on its part,
specifying the date on which its desired resignation shall become effective;
provided that such date shall not be less than 90 days after the date on which
such notice is given unless the Company otherwise agrees.  The Warrant Agent
hereunder may be removed at any time by the filing with it of an instrument in
writing signed by or on behalf of the Company and specifying such removal and
the date when it shall become effective, which date shall not be less than 90
days after such notice is given unless the Warrant Agent otherwise agrees.  Any
removal under this Section 5.06(b) shall take effect upon the appointment by the
Company as hereinafter provided of a successor Warrant Agent

 

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(which shall be (i) a bank or trust company, (ii) organized under the laws of
the United States of America or one of the states thereof, (iii) authorized
under the laws of the jurisdiction of its organization to exercise corporate
trust powers, (iv) having a combined capital and surplus of at least $50,000,000
(as set forth in its most recent reports of condition published pursuant to law
or to the requirements of any United States federal or state regulatory or
supervisory authority) and (v) having an office in the Borough of Manhattan, the
City of New York) and the acceptance of such appointment by such successor
Warrant Agent.

 

(c)          Company to Appoint Successor.  In the event that at any time the
Warrant Agent resigns, is removed, becomes incapable of acting, fails to perform
any of its obligations hereunder or under any Warrant Certificate in accordance
with the terms hereof or thereof, is adjudged bankrupt or insolvent, commences a
voluntary case under the federal bankruptcy laws, as now or hereafter
constituted, or under any other applicable federal or state bankruptcy,
insolvency or similar law, consents to the appointment of or taking possession
by a receiver, custodian, liquidator, assignee, trustee, sequestrator or other
similar official of the Warrant Agent or its property or affairs, makes an
assignment for the benefit of creditors, admits in writing its inability to pay
its debts generally as they become due, or takes corporate action in furtherance
of any such action, or a decree or order for relief by a court having
jurisdiction in the premises has been entered in respect of the Warrant Agent in
an involuntary case under the federal bankruptcy laws, as now or hereafter
constituted, or any other applicable federal or state bankruptcy, insolvency or
similar law, or a decree or order by a court having jurisdiction in the premises
has been entered for the appointment of a receiver, custodian, liquidator,
assignee, trustee, sequestrator or similar official of the Warrant Agent or of
its property or affairs, or any public officer takes charge or control of the
Warrant Agent or of its property or affairs for the purpose of rehabilitation,
conservation, winding up or liquidation, a successor Warrant Agent, meeting the
qualifications specified in Section 5.06(b), shall be appointed by the Company
by an instrument in writing, filed with the successor Warrant Agent.  In the
event that a successor Warrant Agent is not appointed by the Company, a
successor Warrant Agent, qualified as aforesaid, may be appointed by the Warrant
Agent or the Warrant Agent may petition a court to appoint a successor Warrant
Agent.  Upon the appointment as aforesaid of a successor Warrant Agent and
acceptance by the successor Warrant Agent of such appointment, the Warrant Agent
shall cease to be Warrant Agent hereunder; provided that in the event of the
resignation of the Warrant Agent under this subsection (c), such resignation
shall be effective on the earlier of (i) the date specified in the Warrant
Agent’s notice of resignation and (ii) the appointment and acceptance of a
successor Warrant Agent hereunder.

 

(d)         Successor to Expressly Assume Duties.  Any successor Warrant Agent
appointed hereunder shall execute, acknowledge and deliver to its predecessor
and to the Company an instrument accepting such appointment hereunder, and
thereupon such successor Warrant Agent, without any further act, deed or
conveyance, shall become vested with all the rights and obligations of such
predecessor with like effect as if originally named as Warrant Agent hereunder,
and such predecessor, upon payment of its charges and disbursements then unpaid,
shall thereupon become obligated to transfer, deliver and pay over, and such
successor Warrant Agent shall be entitled to receive, all monies, securities and
other property on deposit with or held by such predecessor, as Warrant Agent
hereunder.

 

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(e)          Successor by Merger.  Any entity into which the Warrant Agent
hereunder may be merged or consolidated, or any entity resulting from any merger
or consolidation to which the Warrant Agent is a party, or any entity to which
the Warrant Agent sells or otherwise transfers all or substantially all of its
assets and business (including with respect to the administration of this
Agreement), shall be the successor Warrant Agent under this Agreement without
the execution or filing of any paper or any further act on the part of any of
the parties hereto; provided that it is open for business on each Business Day
and (i) (A) is organized under the laws of the United States of America or one
of the states thereof, (B) is authorized under the laws of the jurisdiction of
its organization to exercise corporate trust or stock transfer powers and
(C) has a combined capital and surplus of at least $50,000,000 or (ii) is an
Affiliate of an entity that meets the requirements set forth in clause (i).

 

Section 5.07.                          Representations of the Company.

 

The Company represents and warrants to the Warrant Agent that:

 

(a)         the Company has been duly organized and is validly existing under
the laws of the jurisdiction of its incorporation;

 

(b)         this Agreement has been duly authorized, executed and delivered by
the Company and is enforceable against the Company in accordance with its terms,
except as may be limited by bankruptcy, insolvency, moratorium, reorganization
and other similar laws affecting the enforcement of creditors’ rights generally
and general equitable principles, regardless of whether such enforceability is
considered in a proceeding at law or in equity; and

 

(c)          the execution and delivery of this Agreement does not, and the
issuance of the Warrants in accordance with the terms of this Agreement and the
Warrant Certificates will not, (i) violate the Company’s certificate of
incorporation or by-laws, (ii) violate any law or regulation applicable to the
Company or order or decree of any court or public authority having jurisdiction
over the Company, or (iii) result in a breach of any material mortgage,
indenture, contract, agreement or undertaking to which the Company is a party or
by which it is bound, except in the case of (ii) and (iii) for any violations or
breaches that would not reasonably be expected to have a material adverse effect
on the Company and its subsidiaries, taken as a whole.

 

ARTICLE VI

 

MISCELLANEOUS

 

Section 6.01.                          Persons Benefitting.

 

Nothing in this Agreement is intended or shall be construed to confer upon any
Person other than the Company, the Warrant Agent, the Holders and the owners of
a beneficial interest in any Global Warrant any right, remedy or claim under or
by reason of this Agreement or any part hereof.

 

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Section 6.02.                          Amendment.

 

This Agreement and the Warrants may be amended by the parties hereto without the
consent of any Holder for the purpose of curing any ambiguity, or of curing,
correcting or supplementing any defective provision contained herein or therein
or adding or changing any other provisions with respect to matters or questions
arising under this Agreement or the Warrants as the Company, acting in good
faith, and the Warrant Agent may deem necessary or desirable; provided that such
amendment shall not adversely affect the rights of any of the Holders in any
material respect.  Any amendment or supplement to this Agreement or the
Warrants, or any waiver hereunder or thereunder, in each case, that has an
adverse effect on the interests of any of the Holders or owners of a beneficial
interest in a Global Warrant in any material respect shall require the written
consent of the Holders of a majority of the then outstanding Warrants. 
Notwithstanding anything herein to the contrary and without limitation of the
immediately foregoing sentence, the consent of each Holder affected thereby
shall be required for any amendment or supplement pursuant to which (i) the
Exercise Price would be increased, the Warrant Share Number would be decreased
or the kind or amount of other property issuable upon exercise of the Warrants
would be changed or decreased, as applicable (in each case, other than pursuant
to adjustments provided for in Section 13 of the Warrant Certificate), (ii) the
time period during which the Warrants are exercisable would be shortened,
(iii) any change adverse to such Holder would be made to the antidilution
provisions set forth in Article IV of this Agreement or Section 13 of the
Warrant Certificate (including all definitions used therein) (excluding any
amendment following a Reorganization, pursuant to Section 13(G) of the Warrant
Certificate), (iv) such Holder’s right to exercise the Warrants and receive
Shares upon such exercise, or the ability of any Holder or Agent Member (on
behalf of itself or any beneficial owner) to enforce such right, would otherwise
be materially impaired, or (v) the percentage of Holders required to amend the
Warrants or this Agreement or grant a waiver thereunder or hereunder would be
reduced.  In determining whether the Holders of the required number of Warrants
have concurred in any direction, waiver or consent, Warrants owned by the
Company or by any Affiliate of the Company shall be disregarded and deemed not
to be outstanding, except that, for the purpose of determining whether the
Warrant Agent shall be protected in relying on any such direction, waiver or
consent, only Warrants that the Warrant Agent knows are so owned shall be so
disregarded.  Also, subject to the foregoing, only Warrants outstanding at the
time shall be considered in any such determination.  The Company and the Warrant
Agent may set a record date for any such direction, waiver or consent and only
the Holders as of such record date shall be entitled to make or give such
direction, waiver or consent. The Warrant Agent shall have no duty to determine
whether any such amendment or supplement would have an effect on the rights or
interests of the holders of the Warrants.  Upon receipt by the Warrant Agent of
an Officer’s Certificate and an Opinion of Counsel, each stating that all
conditions precedent to the execution of the amendment or supplement have been
complied with and such execution is permitted by this Agreement and the Warrant
Certificate, the Warrant Agent shall join in the execution of such amendment or
supplement; provided that the Warrant Agent may, but shall not be obligated to,
execute any such amendment or supplement which affects the rights or changes or
increases the duties or obligations of the Warrant Agent. Promptly following
execution of any amendment or supplement to this Agreement or the Warrant
Certificate, the Company shall send a copy thereof to the Warrant Agent and
cause such document to be sent or communicated to the Warrantholders and holders

 

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of a beneficial interest in a Global Warrant in the manner set forth in
Section 21 of the Warrant Certificate; provided that failure to deliver such
copy to the Warrant Agent or otherwise deliver such document to all
Warrantholders or holders of a beneficial interest in a Global Warrant or any
defect therein shall not affect the validity of such amendment or supplement. As
a condition precedent to the Warrant Agent’s execution of any such amendment or
supplement, the Company shall deliver to the Warrant Agent an Officer’s
Certificate that states that the proposed amendment or supplement is in
compliance with the terms of this Section 6.02.

 

Section 6.03.                          Notices.

 

Any notice or communication shall be in writing and delivered in person, by
certified or registered mail, or nationally-recognized courier, or by facsimile
or e-mail transmission, if acceptable to the parties, addressed as follows:

 

if to the Company:

 

Arch Coal, Inc.

City Place One

St. Louis, MO 63141

Attention: General Counsel

Telephone: (314) 994-2700

Facsimile: (314) 994-2734

 

with a copy to:

 

Brian M. Resnick

Davis Polk & Wardwell LLP

450 Lexington Avenue

New York, NY 10017

Telephone:  (212) 450-4213

Facsimile:  (212) 701-5213

 

if to the Warrant Agent:

 

American Stock Transfer & Trust Company, LLC

6201 15th Avenue

Brooklyn, NY 11219

Attention:  Corporate Actions

Telephone:  (718) 921-8200

 

The Company or the Warrant Agent by notice to the other may designate additional
or different addresses for subsequent notices or communications.

 

Any notice or communication mailed to a Holder shall be mailed to the Holder at
the Holder’s address as it appears on the Registry and shall be sufficiently
given if so mailed within the time prescribed.  Any notice to the owners of a
beneficial interest in a Global Warrant shall be distributed through the
Depositary in accordance with the procedures of the Depositary.

 

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Communications to such owners shall be deemed to be effective at the time of
dispatch to the Depositary.

 

Failure to provide a notice or communication to a Holder or owner of a
beneficial interest in a Global Warrant or any defect in it shall not affect its
sufficiency with respect to other Holders or owners of a beneficial interest in
a Global Warrant. If a notice or communication is provided in the manner
provided above, it is duly given, whether or not the intended recipient actually
receives it.

 

Section 6.04.                          Governing Law.

 

This Agreement will be governed by and construed in accordance with the laws of
the State of New York applicable to contracts made and to be performed entirely
within such State.

 

Section 6.05.                          Successors.

 

All agreements of the Company in this Agreement and the Warrants shall bind its
successors and permissible assigns. All agreements of the Warrant Agent in this
Agreement shall bind its successors and permissible assigns.

 

Section 6.06.                          Multiple Originals; Counterparts.

 

The parties may sign any number of copies of this Agreement. Each signed copy
shall be an original, but all of them together represent the same agreement. One
signed copy is enough to prove this Agreement. A signature to this Agreement
transmitted electronically shall have the same authority, effect, and
enforceability as an original signature.

 

Section 6.07.                          Inspection of Agreement.

 

A copy of this Agreement shall be made available at all reasonable times for
inspection by any registered Holder or owner of a beneficial interest in a
Global Warrant at the office of the Warrant Agent (or successor warrant agent)
designated for such purpose.

 

Section 6.08.                          Table of Contents.

 

The table of contents and headings of the Articles and Sections of this
Agreement have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.

 

Section 6.09.                          Severability.

 

The provisions of this Agreement are severable, and if any clause or provision
shall be held invalid, illegal or unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall affect in that
jurisdiction only such clause or provision, or part thereof, and shall not in
any manner affect such clause or provision in any other jurisdiction or any
other clause or provision of this Agreement in any jurisdiction.

 

20

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Section 6.10.         Customer Identification Program.

 

Each Person that is a party hereto acknowledges that the Warrant Agent is
subject to the customer identification program (“Customer Identification
Program”) requirements under the USA PATRIOT Act and its implementing
regulations, and that the Warrant Agent must obtain, verify and record
information that allows the Warrant Agent to identify each such Person.
Accordingly, prior to accepting an appointment hereunder, the Warrant Agent may
request information from any such Person that will help the Warrant Agent to
identify such Person, including without limitation, as applicable, such Person’s
physical address, tax identification number, organizational documents,
certificate of good standing or license to do business. Each Person that is a
party hereto agrees that the Warrant Agent cannot accept an appointment
hereunder unless and until the Warrant Agent verifies each such Person’s
identity in accordance with the Customer Identification Program requirements.

 

Section 6.11.         Confidentiality.

 

The Warrant Agent and the Company agree that all books, records, information and
data pertaining to the business of the other party, including inter alia,
personal, non-public Warrantholder information, which are exchanged or received
pursuant to the negotiation or the carrying out of this Agreement, including the
fees for services, shall remain confidential, and shall not be voluntarily
disclosed to any other person, except as may be required by law, including,
without limitation, pursuant to subpoenas from state or federal government
authorities (e.g., in divorce and criminal actions).

 

Section 6.12.         Force Majeure.

 

Notwithstanding anything to the contrary contained herein, the Warrant Agent
will not be liable for any delays or failures in performance resulting from acts
beyond its reasonable control including, without limitation, acts of God,
terrorist acts, shortage of supply, breakdowns or malfunctions, interruptions or
malfunction of computer facilities, or loss of data due to power failures or
mechanical difficulties with information storage or retrieval systems, labor
difficulties, war, or civil unrest.

 

[Remainder of page intentionally left blank]

 

21

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IN WITNESS WHEREOF, the parties have caused this Warrant Agreement to be duly
executed as of the date first written above.

 

 

ARCH COAL, INC.

 

 

 

 

 

by

/s/ Robert G. Jones

 

 

Name:

Robert G. Jones

 

 

Title:

Senior Vice President — Law, General Counsel and Secretary

 

 

 

 

 

AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC,

 

as Warrant Agent

 

 

 

 

 

by

/s/ Paula Caroppoli

 

Name:

Paula Caroppoli

 

Title:

Senior Vice President

 

22

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EXHIBIT A

 

FORM OF SERIES A WARRANT

 

23

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FORM OF SERIES A WARRANT

 

[Global Warrant Legend]

 

[UNLESS THIS GLOBAL WARRANT IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO
ARCH COAL, INC. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY WARRANT CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

TRANSFERS OF THIS GLOBAL WARRANT SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT
IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL WARRANT SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE WARRANT
AGREEMENT REFERRED TO ON THE REVERSE HEREOF.]

 

NO AFFILIATE OF ARCH COAL, INC. THAT OWNS THIS SECURITY (OR ANY INTEREST HEREIN)
MAY SELL THIS SECURITY (OR ANY INTEREST HEREIN) IF UPON SUCH RESALE THIS
SECURITY (OR SUCH INTEREST) WOULD CONSTITUTE A “RESTRICTED SECURITY” WITHIN THE
MEANING OF RULE 144 UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

 

A-1

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[GLOBAL][DEFINITIVE] WARRANT
representing

 

SERIES A WARRANTS

 

to acquire
shares of
Common Stock
of
ARCH COAL, INC.

 

No.  [     ]

CUSIP No.: 039380 118

 

1.             Definitions.  Unless the context otherwise requires, when used
herein the following terms shall have the meanings indicated. Any capitalized
terms used but not defined herein that are defined in the Warrant Agreement
shall have the meanings set forth in the Warrant Agreement.

 

“Affiliate” shall have the meaning ascribed to it in the Warrant Agreement.

 

“Agent Members” shall have the meaning ascribed to it in the Warrant Agreement.

 

“Bankruptcy Code” means title 11 of the United States Code, 11 U.S.C. §§ 101 et
seq.

 

“Black Scholes Payment” means, for any Warrant, the lesser of (A) (i) the fair
value of such Warrant as determined by the Valuation Bank, based on Black
Scholes option pricing inputs selected within one month prior to the public
announcement of the relevant Repurchase Reorganization, multiplied by (ii) the
Black Scholes Proportion; provided that the volatility input used to determine
such fair value in clause (i) shall be the lesser of (x) 50% and (y) the 180-day
historical volatility of the Common Stock as shown at the time of determination
on Bloomberg or, if such information is not available, as determined in a
commercially reasonably manner by the Valuation Bank and (B) (x) the Maximum
Payment Amount, multiplied by (y) 59.287452%, multiplied by (z) the Black
Scholes Proportion.

 

“Black Scholes Proportion” means a fraction, (x) the numerator of which is the
aggregate Fair Market Value of all consideration other than Reporting Stock
received by holders of Common Stock comprising the Exchange Property in the
relevant Repurchase Reorganization and (y) the denominator of which is the sum
of (a) the aggregate Fair Market Value of the Reporting Stock (if any) received
as consideration by holders of Common Stock comprising the Exchange Property in
the relevant Repurchase Reorganization and (b) the aggregate Fair Market Value
of all consideration other than Reporting Stock received by holders of Common
Stock comprising the Exchange Property in the relevant Repurchase
Reorganization.

 

“Board of Directors” means the board of directors of the Company.

 

“Business Day” shall have the meaning ascribed to it in the Warrant Agreement.

 

A-2

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“Capital Stock” means (A) with respect to any Person that is a corporation or
company, any and all shares, interests, participations or other equivalents
(however designated) of capital or capital stock of such Person and (B) with
respect to any Person that is not a corporation or company, any and all
partnership or other equity interests in such Person.

 

“Charter” means, with respect to any Person, its certificate or articles of
incorporation, articles of association, or similar organizational document.

 

“Common Stock” means the Company’s Class A Common Stock, $0.01 par value per
share, subject to Section 13(G).

 

“Company” means Arch Coal, Inc., a Delaware corporation.

 

“Confirmation Order” means the Order Confirming Debtors’ Joint Plan of
Reorganization under Chapter 11 of the Bankruptcy Code of Arch Coal, Inc., et
al., Chapter 11 Case No. 16-40120-705 dated as of September 13, 2016.

 

“Continuing Reorganization” means (x) any Reorganization that is consummated on
or after October 5, 2021, (y) any Reorganization that is consummated prior to
October 5, 2021 in which Reporting Stock accounts for 90% or more of the Fair
Market Value of the relevant Exchange Property or (z) for any Warrant, any
Elective Reorganization in respect of which the relevant Warrantholder elects
(or is deemed to have elected) for such Warrant to be subject to Section 13(G).

 

“Custodian” shall have the meaning ascribed to it in the Warrant Agreement.

 

“Definitive Warrant” means a Warrant Certificate in definitive form that is not
deposited with the Depositary or with the Custodian.

 

“Depositary” means The Depository Trust Company, its nominees and their
respective successors.

 

“Determination Date” means, in respect of any exercise of Warrants, the relevant
Exercise Date for such exercise.

 

“Elective Reorganization” means any Reorganization that is consummated prior to
October 5, 2021 in which Reporting Stock accounts for less than 90% of the Fair
Market Value of the relevant Exchange Property.

 

“Exchange” means the principal U.S. national or regional securities exchange on
which the Common Stock is then listed or, if the Common Stock is not then listed
on a U.S. national or regional securities exchange, the principal other market
on which the Common Stock is then traded.

 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, or
any successor statute, and the rules and regulations promulgated thereunder.

 

“Exchange Property” means, with respect to any Reorganization, the cash,
securities or other property that the Common Stock is converted into, is
exchanged for or becomes the right to receive, in each case, in such
Reorganization.

 

“Exercise Date” shall have the meaning ascribed to it in Section 3.

 

A-3

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“Exercise Notice” means a notice in the form attached hereto as Annex B
delivered by the Warrantholder to the Warrant Agent in accordance with
Section 6.03 of the Warrant Agreement to exercise the Warrant.

 

“Exercise Period” shall have the meaning ascribed to it in Section 3.

 

“Exercise Price” means $57.00 per Share subject to any adjustment or adjustments
in accordance with Section 13.

 

“Expiration Time” shall have the meaning ascribed to it in Section 3.

 

“Fair Market Value” means:

 

(i)            in the case of shares of stock that are listed on a Principal
Exchange on the day as of which Fair Market Value is being determined, the daily
volume-weighted average price of such stock as reported in composite
transactions for United States exchanges and quotation systems for such
determination date, as displayed under the heading “Bloomberg VWAP” on the
applicable Bloomberg page for such shares in respect of the period from the
scheduled open of trading until the scheduled close of trading of the primary
trading session on such determination date (or, if such volume-weighted average
price is unavailable, the Fair Market Value of such shares as determined
pursuant to clause (ii) below); provided that, with respect to any determination
of Fair Market Value pursuant to this clause (i), the Company, in its good faith
determination, shall make appropriate adjustments to such daily volume-weighted
average price to account for any adjustments to the Exercise Price and Warrant
Share Number that become effective, or any event requiring any adjustments to
the Exercise Price and Warrant Share Number where the ex-date, record date,
effective date, expiration date or issuance date, as the case may be, of the
event occurs, on such determination date;

 

(ii)           in the case of securities not covered by (i) above, the Fair
Market Value of such securities shall be determined by the Valuation Bank, using
one or more valuation methods that the Valuation Bank in its best professional
judgment determines to be most appropriate, assuming such securities are fully
distributed and are to be sold in an arm’s-length transaction and there was no
compulsion on the part of any party to such sale to buy or sell and taking into
account all relevant factors;

 

(iii)          in the case of cash, the amount thereof; and

 

(iv)          in the case of other property, the Fair Market Value of such
property shall be determined by the Valuation Bank, using one or more valuation
methods that the Valuation Bank in its best professional judgment determines to
be most appropriate, assuming such property is to be sold in an arm’s-length
transaction and there was no compulsion on the part of any party to such sale to
buy or sell and taking into account all relevant factors.

 

“Global Warrant” means a Warrant Certificate in global form that is deposited
with the Depositary or with the Custodian.

 

“Market Disruption Event” means (i) a failure by the Exchange to open for
trading during its regular trading session or (ii) the occurrence or existence
prior to 1:00 p.m. New York City time on any day on which the Exchange is open
for trading for more than one half-hour period in the aggregate during regular
trading hours of any suspension or limitation imposed on trading (by reason of
movements

 

A-4

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in price exceeding limits permitted by the Exchange or otherwise) in the Common
Stock or in any options contracts or futures contracts relating to the Common
Stock.

 

“Maximum Payment Amount” means (I) prior to the first anniversary of the Plan
Effective Date (as such term is defined in the Plan Term Sheet), $23.50, (II) on
or after the first anniversary of the Plan Effective Date (as such term is
defined in the Plan Term Sheet) and prior to the second anniversary of the Plan
Effective Date (as such term is defined in the Plan Term Sheet), $20.89,
(III) on or after the second anniversary of the Plan Effective Date (as such
term is defined in the Plan Term Sheet) and prior to the third anniversary of
the Plan Effective Date (as such term is defined in the Plan Term Sheet), $18.28
and (IV) on or after the third anniversary of the Plan Effective Date (as such
term is defined in the Plan Term Sheet) and prior to the fifth anniversary of
the Plan Effective Date (as such term is defined in the Plan Term Sheet),
$15.67.

 

“Net Settlement” shall have the meaning ascribed to it in Section 4(A).

 

“New Warrants” shall have the meaning ascribed to it in Section 13(H).

 

“Person” shall have the meaning ascribed to it in the Warrant Agreement.

 

“Physical Settlement” shall have the meaning ascribed to it in Section 4(A).

 

“Plan Term Sheet” means the “Plan Term Sheet,” In re: Arch Coal, Inc., et al.,
Case No. 16-40120, agreed to by (i) Arch Coal Inc. and its subsidiaries that are
debtors in the relevant chapter 11 proceedings, (ii) holders of more than 66
2/3% of the outstanding principal amount of loans under the credit facility
under the Credit Agreement dated as of June 14, 2011, as amended, restated,
supplemented or otherwise modified from time to time, among Arch Coal Inc.,
Wilmington Trust, N.A., as successor administrative agent, the lenders, and the
other agents and parties thereto, and (iii) the official committee of unsecured
creditors appointed in the relevant chapter 11 cases and certain of its members
in their individual capacities.

 

“Principal Exchange” means each of The New York Stock Exchange, The NASDAQ
Global Market and The NASDAQ Global Select Market (or any of their respective
successors).

 

“Registry” shall have the meaning ascribed to it in the Warrant Agreement.

 

“Reorganization” means any consolidation, merger, statutory share exchange,
business combination or similar transaction with a third party, any sale, lease
or other transfer to a third party of substantially all of the consolidated
assets of the Company and its Subsidiaries, or any recapitalization,
reclassification or transaction that results in a change of the Common Stock
(other than as described in Section 13(A)), in each case, in which the Common
Stock is converted into, is exchanged for or becomes the right to receive cash,
securities or other property.

 

“Reporting Stock” means common stock listed on a U.S. national or regional
securities exchange or common stock of a company that provides publicly
available financial reporting, and holds management calls regarding the same, in
each case, no less than quarterly.

 

“Repurchase Reorganization” means, for any Warrant, any Elective Reorganization
in respect of which the relevant Warrantholder elects for such Warrant to be
subject to Section 13(H).

 

A-5

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“SEC” means the U.S. Securities and Exchange Commission.

 

“Securities Act” means the U.S. Securities Act of 1933, as amended, or any
successor statute, and the rules and regulations promulgated thereunder.

 

“Settlement Date” shall have the meaning ascribed to it in Section 5.

 

“Shares” shall have the meaning ascribed to it in Section 2.

 

“Spin-Off” shall have the meaning ascribed to it in Section 13(D).

 

“Subsidiary” means, with respect to any Person, any corporation, partnership,
joint venture, limited liability company or other entity (x) of which such
Person or a subsidiary of such Person is a general partner or (y) of which a
majority of the voting securities or other voting interests, or a majority of
the securities or other interests of which having by their terms ordinary voting
power to elect a majority of the board of directors or persons performing
similar functions with respect to such entity, is directly or indirectly owned
by such Person and/or one or more subsidiaries thereof.

 

“Trading Day” means a day on which (i) no Market Disruption Event occurs and
(ii) trading in the Common Stock occurs on the Exchange; provided that if the
Common Stock is not so listed or traded, “Trading Day” means a Business Day.

 

“Transfer Agent” means American Stock Transfer & Trust Company, LLC, as transfer
agent of the Company, and any successor transfer agent.

 

“Unit of Exchange Property” means, with respect to any Reorganization, the type
and amount of Exchange Property that the holder of one share of Common Stock is
entitled to receive in such Reorganization.

 

“Valuation Bank” means an independent, nationally recognized investment bank
reasonably selected by the Company.

 

“Valuation Period” shall have the meaning ascribed to it in Section 13(D).

 

“Warrant” means a right to acquire a number of shares of Common Stock calculated
pursuant to Section 4, which is designated as a Series A Warrant.  References
herein to “Warrant” shall include the Global Warrant where the context
requires.  For the avoidance of doubt, “Warrant” does not include any other
warrants.

 

“Warrant Agent” shall have the meaning ascribed to it in Section 18.

 

“Warrant Agreement” shall have the meaning ascribed to it in Section 18.

 

“Warrant Certificate” means a registered certificate evidencing Warrants.

 

“Warrantholder” means a registered owner of Warrants as set forth in the
Registry.

 

“Warrant Share Number” means one, as subsequently adjusted from time to time
pursuant to the terms of this Warrant Certificate and the Warrant Agreement.

 

A-6

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2.             Number of Shares; Exercise Price.  This certifies that, for value
received, [Cede & Co.]1[         ]2, and any of its registered assigns, is the
registered owner of [the number of Warrants set forth on Annex A
hereto]3[         Warrants]4, each of which entitles the Warrantholder, upon
exercise thereof pursuant to Section 3, to acquire from the Company a number of
fully paid and nonassessable shares of Common Stock (each a “Share” and
collectively the “Shares”) calculated pursuant to Section 4.  The Warrant Share
Number and the Exercise Price are subject to adjustment as provided herein, and
unless otherwise specified, all references to “Warrant Share Number” and
“Exercise Price” herein shall be deemed to include any such adjustment or series
of adjustments.

 

3.             Exercise of Warrant; Term.  Subject to Section 2, to the extent
permitted by applicable laws and regulations, each Warrant is exercisable by the
relevant Warrantholder, at any time or from time to time during the Exercise
Period by (i) the surrender of such Warrant to the Warrant Agent and the
delivery to the Warrant Agent of the Exercise Notice annexed hereto, duly
completed and executed (or to the Company or to such other office or agency of
the Company in the United States as the Company may designate by notice in
writing to the Warrantholders pursuant to Section 21), together with payment for
transfer taxes as set forth in Section 8 and (ii) if such Warrantholder validly
elects Physical Settlement in accordance with Section 4(A), paying to the
Company the applicable Exercise Price. The “Exercise Period” shall commence upon
the execution and delivery of this Warrant Certificate by the Company on the
date hereof and shall continue up to, and including, the Expiration Time.  The
“Expiration Time” shall be 5:00 p.m. New York City time on the seventh
anniversary of the date of execution and delivery of this Warrant Certificate
or, if such day is not a Business Day, the next succeeding day that is a
Business Day.  The “Exercise Date” shall be the date on which a Warrantholder
surrenders the Warrant and delivers an Exercise Notice in conformity with this
Section 3 and, if applicable, pays the Exercise Price in conformity with this
Section 3 (unless such surrender, delivery and payment (if applicable) occur
after 5:00 p.m. New York City time on a Business Day or on a date that is not a
Business Day, in which event the Exercise Date shall be the next following
Business Day).  In the case of a Global Warrant, any person with a beneficial
interest in such Global Warrant shall effect compliance with the requirements of
this Section 3 through the relevant Agent Members in accordance with the
procedures of the Depositary.

 

In the case of a Global Warrant, whenever some but not all of the Warrants
represented by such Global Warrant are exercised in accordance with the terms
thereof and of the Warrant Agreement, such Global Warrant shall be surrendered
by the Warrantholder to the Warrant Agent, which shall cause an adjustment to be
made to Annex A to such Global Warrant so that the number of Warrants
represented thereby will be equal to the number of Warrants theretofore
represented by such Global Warrant less the number of Warrants then exercised. 
The Warrant Agent shall thereafter promptly return such Global Warrant to the
Warrantholder or its nominee or custodian.  In the case of a Definitive Warrant,
whenever some but not all of the Warrants represented by such Definitive Warrant
are exercised in accordance with the terms thereof and of the Warrant Agreement,
the Warrantholder shall be entitled, at the request of such Warrantholder, to
receive from the Company within a reasonable time, and in any event not
exceeding five Business Days, a new Definitive Warrant in substantially
identical form for the number of Warrants equal to the number of Warrants
theretofore represented by such Definitive Warrant less the number of Warrants
then exercised.

 

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1                                           Include for Global Warrant.

2                                           Include for Definitive Warrant.

3                                           Include for Global Warrant.

4                                          Include for Definitive Warrant.

 

A-7

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If this Warrant Certificate shall have been exercised in full, the Warrant Agent
shall promptly cancel such certificate following its receipt thereof from the
Warrantholder or the Depositary, as applicable.

 

Notwithstanding anything in this Warrant Certificate to the contrary, in the
case of Warrants evidenced by a Global Warrant, any Agent Member may, without
the consent of the Warrant Agent or any other person, on its own behalf and on
behalf of any beneficial owner for which it is acting, enforce, and may
institute and maintain any suit, action or proceeding against the Company
suitable to enforce, or otherwise in respect of, its right to exercise, and to
receive Shares for, its Warrants as provided in the Global Warrant, and to
enforce the Warrant Agreement.

 

A Warrantholder shall be deemed to own and have all of the rights associated
with any Shares or other securities or property to which it is entitled pursuant
to this Warrant Certificate as of the close of business on the relevant
Determination Date upon the exercise of the Warrants in accordance with this
Section 3 and Section 5 below.

 

The Exercise Price in connection with any Physical Settlement of a Warrant may
be paid either by wire transfer of immediately available funds to an account
designated by the Company or by certified or official bank check or bank
cashier’s check payable to the order of the Company or, in respect of a Global
Warrant, otherwise in accordance with the applicable procedures of the
Depositary.

 

4.             Settlement.

 

(A)          Notwithstanding any provisions herein to the contrary, a
Warrantholder that elects to exercise a Warrant shall elect to either (i) pay
the applicable Exercise Price in respect of such Warrant to the Company
(“Physical Settlement”) or (ii) net settle such Warrant in accordance with
Section 4(C) in lieu of paying the Exercise Price (“Net Settlement”), by marking
the applicable box in the relevant Exercise Notice or, in respect of a Global
Warrant, otherwise in accordance with the applicable procedures of the
Depositary.

 

(B)          In the event that a Warrantholder validly elects Physical
Settlement in respect of any exercise of any Warrants evidenced by this Warrant
Certificate in accordance with Sections 3 and 4(A) hereof, the Warrantholder
shall receive, and the Company shall issue to such Warrantholder in accordance
with Section 5 below, a number of Shares for each Warrant so exercised equal to
the Warrant Share Number (as of the Determination Date).

 

(C)          In the event that Net Settlement applies in respect of any exercise
of any Warrants evidenced by this Warrant Certificate in accordance with
Sections 3 and 4(A) hereof, the Warrantholder shall receive, and the Company
shall issue to such Warrantholder in accordance with Section 5 below, a number
of Shares for each Warrant so exercised equal to the greater of (x) zero and
(y) “X” as determined pursuant to the following formula:

 

X =

Y  x

(A – B)

 

 

A

 

Where:

 

Y = the Warrant Share Number (as of the Determination Date);

 

A-8

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A = the Fair Market Value of one share of the Common Stock (as of the
Determination Date); and

 

B = the Exercise Price (as of the Determination Date).

 

The Company shall make all calculations under this Section 4, and the Warrant
Agent shall have no duty or obligation to verify or confirm the Company’s
calculations.

 

5.             Issuance of Shares; Authorization; Listing.  Shares issued upon
the exercise of Warrants evidenced by this Warrant Certificate shall be
(i) issued in such name or names as the exercising Warrantholder may designate
and (ii) delivered by the Transfer Agent to such Warrantholder or its nominee or
nominees (A) if the Shares are delivered through the facilities of the
Depositary, via book-entry transfer crediting the account of such Warrantholder
(or the relevant Agent Member for the benefit of such Warrantholder) through the
Depositary’s DWAC system (if the Transfer Agent participates in such system), or
(B) otherwise in certificated form by physical delivery to the address specified
by the Warrantholder in the Exercise Notice.  The Company shall use its
commercially reasonable efforts to cause its Transfer Agent to be a participant
in the Depositary’s DWAC system.  The Company shall cause the number of full
Shares to which such Warrantholder shall be entitled to be so delivered by the
Transfer Agent within a reasonable time, and in any event on or prior to the
fourth Business Day after the applicable Determination Date (such date of
delivery, the “Settlement Date”).

 

The Company hereby represents, warrants and covenants that any Shares issued
upon the exercise of Warrants evidenced by this Warrant Certificate in
accordance with the provisions of Sections 3, 4 and 5 will be duly and validly
authorized and issued, fully paid and nonassessable and free from all liens and
charges (other than liens or charges created by a Warrantholder).  The Company
agrees that the Shares so issued will be deemed to have been issued to a
Warrantholder for all purposes as of the close of business on the applicable
Determination Date, notwithstanding that the stock transfer books of the Company
may then be closed or certificates representing such Shares may not be actually
delivered on such date.  The Company will at all times reserve and keep
available, out of its authorized but unissued Common Stock, solely for the
purpose of providing for the exercise of Warrants evidenced by this Warrant
Certificate, the aggregate Warrant Share Number for all Warrants evidenced by
this Warrant Certificate.  The Company will procure, at its sole expense, the
listing of the Shares issuable upon exercise of the Warrants evidenced by this
Warrant Certificate, subject to issuance or notice of issuance, on all principal
stock exchanges on which the Common Stock is then listed or traded.  The Company
will use its reasonable best efforts to ensure that the Shares may be issued
without violation of any law or regulation applicable to the Company or of any
requirement applicable to the Company of any securities exchange on which the
Shares are listed or traded.

 

6.             No Fractional Shares or Scrip.  No fractional Shares or scrip
representing fractional Shares shall be issued upon any exercise of Warrants
evidenced by this Warrant Certificate.  In lieu of any fractional Share to which
a Warrantholder would otherwise be entitled upon an exercise of Warrants, such
Warrantholder shall be entitled to receive a cash payment equal to the value of
such fractional Share based on the Fair Market Value of the Common Stock as of
the applicable Determination Date. The number of full Shares that shall be
issuable upon an exercise of Warrants by a Warrantholder at any time shall be
computed on the basis of the aggregate number of Shares which may be issuable
pursuant to the Warrants being exercised by that Warrantholder at that time. 
The beneficial owners of the Warrants and the Warrantholder, by their acceptance
hereof, expressly agree to receive cash in lieu of any fractional Share in
accordance with this Section 6 and hereby waive their right to receive a
physical certificate representing such fractional Share upon exercise of any
Warrant.

 

A-9

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Whenever a payment for fractional Shares is to be made by the Warrant Agent
under any section of this Warrant Certificate or the Warrant Agreement, the
Company shall (i) provide to the Warrant Agent in reasonable detail the facts
related to such payments and the prices and/or formulas utilized in calculating
such payments, and (ii) provide sufficient monies to the Warrant Agent in the
form of fully collected funds to make such payments.

 

7.             No Rights as Stockholders; Transfer Books.  Warrants evidenced by
this Warrant Certificate do not entitle the Warrantholder or the owner of any
beneficial interest in such Warrants to any voting rights or other rights as a
stockholder of the Company prior to the applicable Determination Date.  The
Company will at no time close its transfer books against transfer of the
Warrants in any manner that interferes with the timely transfer and exercise of
the Warrants.

 

8.             Charges, Taxes and Expenses.  Issuance of Shares in certificated
or book-entry form to a Warrantholder upon the exercise of Warrants evidenced by
this Warrant Certificate shall be made without charge to the Warrantholder for
any documentary, stamp or similar issue or transfer taxes (other than any such
taxes due because the Warrantholder requests such Shares to be issued in a name
other than the Warrantholder’s name) or other incidental expense in respect of
the issuance of such Shares, all of which such taxes, if any, and expenses shall
be paid by the Company.  The Warrantholder shall pay to the Company a sum
sufficient to cover any documentary, stamp or similar issue or transfer taxes
due because the Warrantholder requests Shares to be issued in a name other than
the Warrantholder’s name, and the Company may refuse to deliver any such Shares
until it receives a sum sufficient to pay such taxes.

 

9.             Transfer/Assignment.  Subject to compliance with applicable
securities laws and the requirements set forth in the Warrant Agreement, this
Warrant Certificate and all rights hereunder are transferable, in whole or in
part, upon the books of the Company (or an agent duly appointed by the Company)
by the registered holder hereof in person or by duly authorized attorney, and
one or more new Warrant Certificates shall be made and delivered by the Company,
of the same tenor and date as this Warrant Certificate but registered in the
name of one or more transferees, upon surrender of this Warrant Certificate,
duly endorsed, to the office or agency of the Company described in Section 3. 
All expenses and other charges payable in connection with the preparation,
execution and delivery of the new Warrant Certificate pursuant to this Section 9
shall be paid by the Company, except the Warrantholder of the old Warrant
Certificate surrendered for transfer shall pay to the Company a sum sufficient
to cover any documentary, stamp or similar issue or transfer tax due because the
name of the Warrantholder of the new Warrant Certificate issued upon such
transfer is different from the name of the Warrantholder of the old Warrant
Certificate surrendered for transfer.

 

If this Warrant Certificate is a Global Warrant, then so long as the Global
Warrant is registered in the name of the Depositary, (a) the holders of
beneficial interests in the Warrants evidenced thereby shall have no rights
under this Warrant Certificate with respect to the Global Warrant held on their
behalf by the Depositary or the Custodian, and (b) the Depositary may be treated
by the Company, the Warrant Agent and any agent of the Company or the Warrant
Agent as the absolute owner of the Global Warrant for all purposes whatsoever,
except, in each case, to the extent set forth herein.  Accordingly, any such
owner’s beneficial interest in the Global Warrant will be shown only on, and the
transfer of such interest shall be effected only through, records maintained by
the Depositary or the Agent Members, and neither the Company nor the Warrant
Agent shall have any responsibility with respect to such records maintained by
the Depositary or the Agent Members.  Notwithstanding the foregoing, nothing
herein shall (i) prevent the Company, the Warrant Agent or any agent of the
Company or the Warrant Agent from giving effect to any written certification,
proxy or other authorization furnished by

 

A-10

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the Depositary or (ii) impair, as between the Depositary and the Agent Members,
the operation of customary practices governing the exercise of the rights of a
holder of a beneficial interest in any Warrant.  Except as otherwise may be
provided in this Warrant Certificate or the Warrant Agreement, the rights of
beneficial owners in a Global Warrant shall be exercised through the Depositary
subject to the applicable procedures of the Depositary.  Any holder of the
Global Warrant shall, by acceptance of the Global Warrant, agree that transfers
of beneficial interests in the Global Warrant may be effected only through a
book-entry system maintained by the Depositary, and that ownership of a
beneficial interest in the Warrants represented thereby shall be required to be
reflected in book-entry form.

 

A Global Warrant shall be exchanged for Definitive Warrants, and Definitive
Warrants may be transferred or exchanged for a beneficial interest in a Global
Warrant, only at such times and in the manner specified in the Warrant
Agreement. The holder of a Global Warrant may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
beneficial interests in such Global Warrant through Agent Members, to take any
action that a Warrantholder is entitled to take under a Warrant or the Warrant
Agreement.

 

10.          Exchange of Warrants.  This Warrant Certificate is exchangeable,
upon the surrender hereof by the Warrantholder to the Warrant Agent, for a new
Warrant Certificate or Warrant Certificates of like tenor and representing the
same aggregate number of Warrants.

 

11.          Compliance with Law.  The Warrants are issued in reliance upon the
exemption from the registration requirements of Section 5 of the Securities Act
provided by section 1145 of the Bankruptcy Code.  To the extent the Company
determines that the exemption from registration provided under section 1145 of
the Bankruptcy Code is not available with respect to any issuance or transfer of
Warrants, the Warrant Certificates representing such Warrants may be stamped or
otherwise imprinted with a legend, and the Registry may include a restrictive
notation with respect to such Warrants, in substantially the following form:

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE THEREWITH.

 

Any legend or restrictive notation referenced in this Section 11 shall be
removed from the Warrant Certificates or Registry at any time after the
restrictions described in such legend or restrictive notation cease to be
applicable; provided that the Company may request from any Warrantholder
opinions, certificates or other evidence that such restrictions have ceased to
be applicable before removing such legend or restrictive notation.

 

12.          Saturdays, Sundays, Holidays, etc.  If the last or appointed day
for the taking of any action or the expiration of any right required or granted
herein shall not be a Business Day, then such action may be taken or such right
may be exercised on the next succeeding day that is a Business Day.

 

13.          Adjustments and Other Rights.  The Exercise Price and the Warrant
Share Number shall be subject to adjustment from time to time as set forth in
this Section 13; provided that no single event shall give rise to an adjustment
under more than one subsection of this Section 13 (other than in the case of a
dividend or other distribution of different types of property, in which case
Section 13(A), 13(B), 13(C) or 13(D) shall apply to the appropriate parts of
each such dividend or distribution); provided

 

A-11

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further that any issuance of Common Stock upon exercise of the Warrants shall
not itself give rise to any adjustment under this Section 13.

 

(A)          Adjustments upon Certain Transactions.  The Exercise Price and
Warrant Share Number shall be adjusted pursuant to the formulas below in the
event the Company (i) pays a dividend or makes any other distribution with
respect to its Common Stock solely in shares of its Common Stock,
(ii) subdivides or reclassifies its outstanding shares of Common Stock into a
greater number of shares or (iii) combines or reclassifies its outstanding
shares of Common Stock into a smaller number of shares.  Such adjustments shall
become effective (x) in the case of clause (i) above, at the open of business on
the ex-date for such dividend or distribution or (y) in the case of clause
(ii) or (iii) above, at the open of business on the effective date of such
event. In the event that a dividend or distribution described in clause
(i) above is not so paid or made, the Exercise Price and the Warrant Share
Number shall be readjusted, effective as of the date when the Board of Directors
determines not to make such dividend or distribution, as the case may be, to be
the Exercise Price and the Warrant Share Number that would be in effect if such
dividend or distribution had not been declared.

 

Ua =

Ub  x

Oa

 

 

Ob

 

 

 

Pa =

Pb  x

Ob

 

 

Oa

 

Where:

 

Ub = Warrant Share Number before the adjustment

 

Ua = Warrant Share Number after the adjustment

 

Pb = Exercise Price before the adjustment

 

Pa = Exercise Price after the adjustment

 

Ob = Number of shares of Common Stock outstanding immediately before the
transaction in question

 

Oa = Number of shares of Common Stock outstanding immediately after the
transaction in question

 

(B)          Certain Rights, Options and Warrants.  The Exercise Price and
Warrant Share Number shall be adjusted pursuant to the formulas below in the
event the Company issues to all or substantially all holders of the Common Stock
any rights, options or warrants (other than in connection with a shareholder
rights plan) entitling them, for a period of not more than 60 calendar days
after the announcement date of such issuance, to subscribe for or purchase
shares of the Common Stock at a price per share that is less than the average of
the Fair Market Values of one share of Common Stock for the 10 consecutive
Trading Day period ending on, and including, the Trading Day immediately
preceding the announcement date of such issuance; provided that the Exercise
Price shall not be increased (and Warrant Share Number shall not be decreased)
as a result of this Section 13(B).  Such adjustments shall be made

 

A-12

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successively whenever any such rights, options or warrants are issued and shall
become effective at the open of business on the ex-date for such issuance. To
the extent that shares of the Common Stock are not delivered after the
expiration of such rights, options or warrants, the Exercise Price and the
Warrant Share Number shall be readjusted to be the Exercise Price and the
Warrant Share Number that would then be in effect had the adjustment with
respect to the issuance of such rights, options or warrants been made on the
basis of delivery of only the number of shares of Common Stock actually
delivered.  In the event that such rights, options or warrants are not so
issued, the Exercise Price and the Warrant Share Number shall be readjusted to
be the Exercise Price and the Warrant Share Number that would then be in effect
if such ex-date had not occurred.  For purposes of this Section 13(B), in
determining whether any rights, options or warrants entitle the holders to
subscribe for or purchase shares of the Common Stock at less than such average
of the Fair Market Values of one share of Common Stock for the 10 consecutive
Trading Day period ending on, and including, the Trading Day immediately
preceding the announcement date of such issuance, and in determining the
aggregate offering price of such shares of Common Stock, there shall be taken
into account the Fair Market Value of any consideration received by the Company
for such rights, options or warrants and any amount payable on exercise or
conversion thereof.

 

Ua =

Ub  x

Ob + X

 

 

Ob + Y

 

 

 

Pa =

Pb  x

Ob + Y

 

 

Ob + X

 

Where:

 

Ub = Warrant Share Number before the adjustment

 

Ua = Warrant Share Number after the adjustment

 

Pb = Exercise Price before the adjustment

 

Pa = Exercise Price after the adjustment

 

Ob = Number of shares of Common Stock outstanding immediately before the
transaction in question

 

X = Number of shares of Common Stock issuable pursuant to such rights, options
or warrants

 

Y = Number of shares of Common Stock equal to the aggregate price payable to
exercise such rights, options or warrants, divided by the average of the Fair
Market Values of one share of Common Stock over the 10 consecutive Trading Day
period ending on, and including, the Trading Day immediately preceding the
announcement date of the issuance of such rights, options or warrants

 

(C)          Certain Dividends and Distributions.  If the Company dividends or
distributes shares of securities, evidences of indebtedness, assets, cash,
rights, options or warrants (other than (i) dividends, distributions or
issuances for which an adjustment is made pursuant to Section 13(A) or

 

A-13

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Section 13(B) and (ii) Spin-Offs as to which the provisions of
Section 13(D) below shall apply) to all or substantially all holders of the
Common Stock, the Exercise Price and Warrant Share Number shall be adjusted
pursuant to the formulas below.  Such adjustments shall become effective at the
open of business on the ex-date for such dividend or distribution. In the event
that such dividend or distribution is not so paid or made, the Exercise Price
and the Warrant Share Number shall be readjusted, effective as of the date when
the Board of Directors determines not to make such dividend or distribution, as
the case may be, to be the Exercise Price and the Warrant Share Number that
would be in effect if such dividend or distribution had not been declared.

 

Ua =

Ub  x

M

 

 

M-D

 

 

 

Pa =

Pb  x

M-D

 

 

M

 

Where:

 

Ub = Warrant Share Number before the adjustment

 

Ua = Warrant Share Number after the adjustment

 

Pb = Exercise Price before the adjustment

 

Pa = Exercise Price after the adjustment

 

M = Average of the Fair Market Values of one share of Common Stock for the 10
consecutive Trading Day period ending on, and including, the Trading Day
immediately preceding the ex-date for such dividend or distribution

 

D = Fair Market Value of such dividend or distribution made per share of Common
Stock as of the ex-date; provided that if such Fair Market Value is determined
by reference to the actual or when-issued trading market for any securities,
such determination shall consider the prices in such market over the 10
consecutive Trading Day period ending on, and including, the Trading Day
immediately preceding such ex-date

 

(D)          Spin-Offs.  If the Company pays a dividend or makes any other
distribution on the Common Stock of shares of Capital Stock of any class or
series, or similar equity interest, of or relating to a Subsidiary or other
business unit of the Company, that are, or, when issued, will be, listed or
admitted for trading on a U.S. national securities exchange (a “Spin-Off”), the
Exercise Price and Warrant Share Number shall be adjusted pursuant to the
formulas below.  Such adjustments shall become effective at the close of
business on the last Trading Day of the 10 consecutive Trading Day period
beginning on, and including, the ex-date for such Spin-Off (the “Valuation
Period”).

 

Ua =

Ub  x

D + M

 

 

M

 

A-14

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Pa =

Pb  x

M

 

 

D + M

 

Where:

 

Ub = Warrant Share Number before the adjustment

 

Ua = Warrant Share Number after the adjustment

 

Pb = Exercise Price before the adjustment

 

Pa = Exercise Price after the adjustment

 

M = Average of the Fair Market Values of one share of Common Stock over the
Valuation Period

 

D = Average of the Fair Market Values of such Capital Stock or similar equity
interest distributed to holders of the Common Stock applicable to one share of
the Common Stock over the Valuation Period

 

If the Determination Date for any exercise of Warrants occurs during the
Valuation Period, the reference in the definition of “Valuation Period” to “10”
shall be deemed replaced with such lesser number of Trading Days as have elapsed
between the ex-date for such Spin-Off and such Determination Date in determining
the Exercise Price and Warrant Share Number.

 

(E)           Tender and Exchange Offers.  If a publicly-announced tender or
exchange offer made by the Company or any of its Subsidiaries for the Common
Stock (other than a Reorganization) shall be consummated, to the extent that the
cash and Fair Market Value of any other consideration included in the payment
per share of Common Stock exceeds the average of the Fair Market Values of one
share of Common Stock over the 10 consecutive Trading Day period ending on, and
including, the tenth Trading Day immediately following the date on which such
tender or exchange offer is consummated, then the Exercise Price and the Warrant
Share Number shall be adjusted pursuant to the formulas below; provided that the
Exercise Price shall not be increased (and Warrant Share Number shall not be
decreased) as a result of this Section 13(E).  Such adjustments shall be
determined at the close of business on the tenth Trading Day immediately
following the date on which such tender or exchange offer is consummated, but
shall become effective as of the date on which such tender or exchange offer
expires.

 

Ua =

Ub  x

(Oa x M) + E

 

 

Ob x M

 

 

 

Pa =

Pb  x

Ob x M

 

 

(Oa x M) + E

 

Where:

 

A-15

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Ub = Warrant Share Number before the adjustment

 

Ua = Warrant Share Number after the adjustment

 

Pb = Exercise Price before the adjustment

 

Pa = Exercise Price after the adjustment

 

M = Average of the Fair Market Values of one share of Common Stock over the 10
consecutive Trading Day period ending on, and including, the tenth Trading Day
immediately following the date on which such tender or exchange offer is
consummated

 

E = Aggregate Fair Market Value of all cash and any other consideration paid or
payable for shares of Common Stock in such tender or exchange offer

 

Ob = Number of shares of Common Stock outstanding immediately before giving
effect to such tender or exchange offer

 

Oa = Number of shares of Common Stock outstanding immediately after giving
effect to such tender or exchange offer

 

If the Determination Date for any exercise of Warrants occurs on or after the
date on which such tender or exchange offer expires and prior to the tenth
Trading Day immediately following the date on which such tender or exchange
offer is consummated, references in this Section 13(E) to “tenth Trading Day
immediately following the date on which such tender or exchange offer is
consummated” shall be deemed replaced by references to such Determination Date
and references in this Section 13(E) to “10” shall be deemed replaced with such
lesser number of Trading Days as have elapsed between the date on which such
tender or exchange offer is consummated and such Determination Date, in each
case, in determining the Exercise Price and Warrant Share Number.

 

(F)           Elective Reorganizations.  On or prior to the fifth Business Day
immediately following the occurrence of any Elective Reorganization, the Company
shall notify each Warrantholder and the Warrant Agent of such occurrence and the
related Black-Scholes Payment payable per Warrant pursuant to Section 13(H).
 Upon the occurrence of any Elective Reorganization, each Warrantholder shall
have the right, on or prior to the tenth Business Day immediately following such
occurrence, to elect for such Elective Reorganization to be (x) deemed to be and
treated as a Continuing Reorganization, in which case, in connection with such
Elective Reorganization, the Warrants held by such Warrantholder shall be
governed by Section 13(G) or (y) deemed to be and treated as a Repurchase
Reorganization, in which case, in connection with such Elective Reorganization,
the Warrants held by such Warrantholder shall be governed by Section 13(H).  If
any Warrantholder has not made the election described in the immediately
preceding sentence or any Warrantholder exercises its Warrants, in each case, on
or prior to the tenth Business Day immediately following the occurrence of any
Elective Reorganization, such Warrantholder shall be deemed to have elected for
such Elective Reorganization to be deemed to be and treated as a Continuing
Reorganization.

 

In the case of any Reorganization that is consummated prior to October 5, 2021
in which holders of Common Stock may make an election as between different types
of Exchange Property, for purposes of determining whether such Reorganization is
an Elective Reorganization, the Exchange Property shall be deemed to be
comprised of (x) the weighted average of the types and amounts of

 

A-16

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consideration received by the holders of Common Stock that affirmatively make
such an election or (y) if less than 5% of the holders of Common Stock
affirmatively make such an election, the types and amounts of consideration
actually received by the holders of Common Stock.

 

(G)          Continuing Reorganizations.  In the case of any Continuing
Reorganization, then, following the effective time of such Continuing
Reorganization, a Warrantholder’s right to receive Shares upon exercise of the
Warrants evidenced by this Warrant Certificate shall be converted into the right
to exercise such Warrants to acquire, with respect to each Share that would have
otherwise been deliverable hereunder, one Unit of Exchange Property; provided
that if the Exchange Property consists solely of cash, upon the consummation of
such Continuing Reorganization, each Warrantholder shall receive, and the
Company shall deliver to such Warrantholder, in respect of each Warrant such
Warrantholder holds, at the same time and upon the same terms as holders of
Common Stock receive the cash in exchange for their shares of Common Stock, an
amount of cash equal to the greater of (i) (x) the amount of cash that such
Warrantholder would have received if such Warrantholder owned, as of the record
date for such Continuing Reorganization, a number of shares of Common Stock
equal to the Warrant Share Number in effect on such record date, minus (y) the
Exercise Price in effect on such record date multiplied by the Warrant Share
Number in effect on such record date and (ii) $0, and upon the Company’s
delivery of such cash (if any) in respect of such Warrant, such Warrant shall be
deemed to have been exercised in full and canceled. With respect to any exercise
of Warrants following the effective time of such Continuing Reorganization, the
number of Units of Exchange Property issuable upon exercise of a Warrant shall
be calculated pursuant to Section 4; provided that, with respect to each
Determination Date following such Continuing Reorganization, each reference in
Section 4 to a “Share” or a “share of Common Stock” shall be deemed to refer to
a Unit of Exchange Property.

 

In the case of any Continuing Reorganization in which holders of Common Stock
may make an election as between different types of Exchange Property, a
Warrantholder shall be deemed to have elected to receive upon exercise of the
Warrants (x) the weighted average of the types and amounts of consideration
received by the holders of Common Stock that affirmatively make such an election
or (y) if less than 5% of the holders of Common Stock affirmatively make such an
election, the types and amounts of consideration actually received by the
holders of Common Stock.  The Company shall not consummate any Continuing
Reorganization unless the Company first shall have made appropriate provision to
ensure that applicable provisions of this Warrant Certificate (including,
without limitation, the applicable provisions of this Section 13) shall
immediately after giving effect to such Continuing Reorganization be assumed by
and binding on the other party to such Continuing Reorganization (or the
surviving entity, successor, parent company and/or issuer of the Exchange
Property, as appropriate) and applicable to any Exchange Property deliverable
upon the exercise of Warrants, pursuant to a customary assumption agreement. 
Any such assumption agreement shall also include any amendments to this Warrant
Certificate necessary to effect the changes to the terms of the Warrants
described in this Section 13(G) and preserve the intent of the provisions of
this Warrant Certificate (including, without limitation, the adjustment
provisions in this Section 13).  The provisions of this Section 13(G) shall
similarly apply to successive Continuing Reorganizations.

 

The Company shall notify the Warrant Agent of any proposed Reorganization
reasonably prior to the consummation thereof so as to provide the Warrantholders
with a reasonable opportunity to confirm compliance with the terms hereof and,
if they elect, to exercise the Warrants in accordance with the terms and
conditions hereof prior to consummation of such Reorganization, and the Company
shall cause such notice to be sent or communicated to the Warrantholders and
holders of a beneficial interest in a Global Warrant in the manner set forth in
Section 21 hereof; provided that in the case of a transaction which requires
notice to be given to the holders of the Common Stock, the Warrant Agent and the

 

A-17

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Warrantholders and holders of a beneficial interest in a Global Warrant shall be
provided the same notice given to the holders of the Common Stock.

 

(H)          Repurchase Reorganizations. On or prior to the fifteenth Business
Day immediately following the occurrence of any Repurchase Reorganization, the
Company shall, upon delivery of the related Warrant Certificate to the Company
(x) pay each applicable Warrantholder an amount of cash per Warrant equal to the
Black Scholes Payment and (y) to the extent any portion of Exchange Property in
respect of such Repurchase Reorganization is comprised of Reporting Stock,
exchange such Warrants for new warrants and related warrant certificates (the
“New Warrants”) with terms consistent with the terms set forth in this Warrant
Certificate and issued under a warrant agreement with terms consistent with the
Warrant Agreement, as if Section 13(G) applied to such Warrants; provided that
(1) each New Warrant shall relate to a number (which, for the avoidance of
doubt, may be less than one) of shares of Reporting Stock that a holder of one
share of Common Stock received in the relevant Repurchase Reorganization,
multiplied by the Warrant Share Number and (2) the “Exercise Price” of the New
Warrants shall be equal to the Exercise Price of the Warrants evidenced by this
Warrant Certificate, multiplied by one minus the Black Scholes Proportion.  For
the avoidance of doubt, following the occurrence of any Repurchase
Reorganization, each applicable Warrantholder shall not be entitled to any
payment or delivery, or other rights, with respects to its Warrants, other than
as set forth in the immediately preceding sentence.  No Warrants to which this
Section 13(H) applies may be exercised during the period beginning on the date
that the relevant Warrantholder elects for the relevant Elective Reorganization
to be deemed to be and treated as a Repurchase Reorganization and ending on, and
including, the fifteenth Business Day immediately following the occurrence of
such Elective Reorganization (or, if later, the date on which such Warrantholder
delivers the related Warrant Certificate to the Company).

 

The provisions of Section 13(G) above and this Section 13(H) are subject, in all
cases, to any applicable requirements under the Securities Act and the Exchange
Act and the respective rules and regulations promulgated thereunder. Where there
is any inconsistency between the requirements of the Securities Act or the
Exchange Act or the rules and regulations promulgated thereunder and the
requirements of Section 13(G) above or this Section 13(H), the requirements of
the Securities Act and the Exchange Act and the respective rules and regulations
promulgated thereunder shall supersede.

 

(I)            Record Owners.  Notwithstanding this Section 13 or any other
provision of this Warrant Certificate or the Warrant Agreement, if an adjustment
to the Warrant Share Number and the Exercise Price becomes effective on the
ex-date for any dividend, distribution or other event, and a Warrantholder that
has exercised its Warrants on or after such ex-date and on or prior to the
related record date would be treated as the record owner of the shares of Common
Stock due upon exercise as of the related Exercise Date as described in
Section 3 based on an adjusted Warrant Share Number and Exercise Price for the
dividend or distribution corresponding to such ex-date, then, notwithstanding
the Warrant Share Number and Exercise Price adjustment provisions in this
Section 13, the Warrant Share Number and Exercise Price adjustment relating to
the dividend or distribution corresponding to such ex-date shall not be made for
such exercising Warrantholder. Instead, such Warrantholder shall be treated as
if such Warrantholder were the record owner of the shares of Common Stock
without giving effect to the adjustment in question and participate in the
related dividend, distribution or other event giving rise to such adjustment.

 

(J)            Certain Other Events.   The Company may make decreases in the
Exercise Price and/or increases in the Number of Warrants as the Board of
Directors deems advisable in good faith in order to avoid or diminish any income
tax to holders of the Common Stock resulting from any dividend

 

A-18

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or distribution of stock (or rights to acquire stock) or from any event treated
as such for income tax purposes.

 

(K)          Shareholder Rights Plans.  If the Company has a shareholder rights
plan in effect upon any exercise of Warrants, each share of Common Stock issued
upon such exercise shall be entitled to receive the appropriate number of
rights, if any, and the certificates representing the Common Stock issued upon
such exercise shall bear such legends, if any, in each case as may be provided
by the terms of any such shareholder rights plan, as the same may be amended
from time to time. However, if, prior to any exercise of Warrants, the rights
have separated from the shares of Common Stock in accordance with the provisions
of the applicable shareholder rights plan, the Exercise Price and Warrant Share
Number shall be adjusted at the time of separation as if the Company made a
distribution of the type for which an adjustment is made pursuant to
Section 13(C), subject to readjustment in the event of the expiration,
termination or redemption of such rights.

 

(L)           Rounding of Calculations; Minimum Adjustments.  All calculations
under this Section 13 shall be made to the nearest one-tenth (1/10th) of a cent
or to the nearest one-hundredth (1/100th) of a share, as the case may be. Any
provision of this Section 13 to the contrary notwithstanding, no adjustment in
the Exercise Price or the Warrant Share Number shall be made if the amount of
such adjustment would be less than $0.01 or one-tenth (1/10th) of a share of
Common Stock, but any such amount shall be carried forward and an adjustment
with respect thereto shall be made at the time of and together with any
subsequent adjustment which, together with such amount and any other amount or
amounts so carried forward, shall aggregate $0.01 or 1/10th of a share of Common
Stock, or more, or upon exercise of a Warrant if it shall earlier occur.

 

(M)         Notice of Adjustment.  Whenever the Warrant Share Number, the number
of shares of stock or property other than Common Stock issuable upon the
exercise of the Warrants or the Exercise Price is adjusted, or the type of
securities or property to be delivered upon exercise of the Warrants is changed,
as herein provided, the Company shall deliver to the Warrant Agent a notice of
such adjustment or adjustments and shall deliver to the Warrant Agent a
statement setting forth the Warrant Share Number, the number and type of shares
of stock or property other than Common Stock issuable upon the exercise of a
Warrant and the Exercise Price 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, and the Company shall cause such
notice and statement to be sent or communicated to the Warrantholders and
holders of a beneficial interest in a Global Warrant in the manner set forth in
Section 21 hereof.  Any failure by the Company to deliver such notice or
statement shall not affect the validity of the relevant adjustments.

 

(N)          Notice of Action.  In the event that the Company shall propose to
take any action of the type described in this Section 13 (but only if the action
of the type described in this Section 13 would result in an adjustment in the
Exercise Price or the Warrant Share Number or a change in the type of securities
or property to be delivered upon exercise of a Warrant), the Company shall
deliver to the Warrant Agent a notice and shall cause such notice to be sent or
communicated to the Warrantholders and holders of a beneficial interest in a
Global Warrant in the manner set forth in Section 21 hereof, which notice shall
specify the record date, if any, with respect to any such action and the
approximate date on which such action is to take place. Such notice shall also
set forth the facts with respect thereto as shall be reasonably necessary to
indicate the effect on the Exercise Price and the number, kind or class of
shares or other securities or property which shall be deliverable upon exercise
of a Warrant. In the case of any action which would require the fixing of a
record date, such notice shall be given at least 10 days prior to the date so
fixed, and in case of all other action, such notice shall be given at least 15
days prior to the

 

A-19

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taking of such proposed action. Failure to give such notice, or any defect
therein, shall not affect the legality or validity of any such action.

 

(O)          Adjustment Rules.  If an adjustment in the Exercise Price made
hereunder would reduce the Exercise Price to an amount below $0.01 then such
adjustment in the Exercise Price made hereunder shall reduce the Exercise Price
to $0.01 and not lower.

 

(P)           Proceedings Prior to Any Action Requiring Adjustment.  As a
condition precedent to the taking of any action which would require an
adjustment pursuant to this Section 13, the Company shall take any action which
may be necessary, including obtaining regulatory, New York Stock Exchange,
NASDAQ Global Market, NASDAQ Global Select Market or other applicable national
securities exchange or stockholder approvals or exemptions, in order that the
Company may thereafter validly and legally issue as fully paid and nonassessable
all Shares that a Warrantholder is entitled to receive upon exercise of a
Warrant pursuant to Section 4, after giving effect to the adjustment that would
be made under this Section 13.

 

14.          Notice of Dividends and Distributions.  At any time when the
Company declares any dividend or other distribution on the Common Stock and the
Common Stock is not listed on a national securities exchange, it shall give
notice to the Warrant Agent of any such declaration not less than 15 days prior
to the related record date for payment of the dividend or distribution so
declared and shall cause such notice to be sent or communicated to the
Warrantholders and holders of a beneficial interest in a Global Warrant in the
manner set forth in Section 21 hereof.

 

15.          No Impairment.  The Company will not, by amendment of its Charter
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms to be observed
or performed hereunder by the Company, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant Certificate and
in taking of all such action as may be necessary or appropriate in order to
protect the rights of the Warrantholders.

 

16.          Governing Law.  This Warrant Certificate and the Warrants evidenced
hereby will be governed by and construed in accordance with the laws of the
State of New York applicable to contracts made and to be performed entirely
within such State.

 

17.          Binding Effect; Countersignature by Warrant Agent.  This Warrant
Certificate shall be binding upon any successors or assigns of the Company. 
This Warrant Certificate shall not be valid until an authorized signatory of the
Warrant Agent (as defined below) or its agent as provided in the Warrant
Agreement (as defined below) countersigns this Warrant Certificate. Such
signature shall be solely for the purpose of authenticating this Warrant
Certificate and shall be conclusive evidence that this Warrant Certificate has
been countersigned under the Warrant Agreement.

 

18.          Warrant Agreement; Amendments.  This Warrant Certificate is issued
under and in accordance with a Warrant Agreement dated as of October 5, 2016
(the “Warrant Agreement”), between the Company and American Stock Transfer &
Trust Company, LLC (the “Warrant Agent,” which term includes any successor
Warrant Agent under the Warrant Agreement), and is subject to the terms and
provisions contained in the Warrant Agreement, to all of which terms and
provisions the beneficial owners of the Warrants and the Warrantholders consent
by acceptance hereof.  The Warrant Agreement is hereby incorporated herein by
reference and made a part hereof.  Reference is hereby made to the Warrant
Agreement for a statement of the respective rights, limitations of rights,
duties and

 

A-20

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obligations of the Company, the Warrant Agent and the Warrantholders and
beneficial owners of the Warrants.  A copy of the Warrant Agreement may be
obtained for inspection by the Warrantholders upon written request to the
Warrant Agent at the address of the Warrant Agent (or successor warrant agent)
set forth in the Warrant Agreement.  The Warrant Agreement and this Warrant
Certificate may be amended and supplemented and the observance of any term of
the Warrant Agreement or this Warrant Certificate may be waived only to the
extent provided in the Warrant Agreement or this Warrant Certificate.

 

19.          Prohibited Actions.  The Company agrees that it will not take any
action which would entitle the Warrantholders to an adjustment of the Exercise
Price if the aggregate Warrant Share Number after such action for the Warrants
evidenced by this Warrant Certificate, together with all shares of Common Stock
then outstanding and all shares of Common Stock then issuable upon the exercise
of, or underlying, all outstanding options, warrants, conversion and other
rights (without duplication), would exceed the total number of shares of Common
Stock then authorized by its Charter.

 

20.          Reports to Warrantholders. In the event that the shares of Common
Stock underlying the Warrants are deregistered or become otherwise not subject
to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the
Company will provide to the Warrantholders, on a continuous basis for so long as
any Warrants remain outstanding, any and all quarterly and annual financial and
other information with respect to the Company and its Subsidiaries as is
provided to the holders of the Common Stock, in each case, in the form in which
such information is so provided to the holders of the Common Stock (which may
include, without limitation, posting such information to the Company’s public
website or a password-protected website created by the Company for such
purpose).

 

21.          Notices.  Any notice or communication mailed to the Warrantholders
shall be mailed to each Warrantholder at the Warrantholder’s address as it
appears in the Registry and shall be sufficiently given if so mailed within the
time prescribed.  Any notice to holders of a beneficial interest in a Global
Warrant shall be distributed through the Depositary in accordance with the
procedures of the Depositary.  Communications to such holders shall be deemed to
be effective at the time of dispatch to the Depositary.

 

A-21

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IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be duly
executed by a duly authorized officer.  This Warrant Certificate shall not be
valid or obligatory for any purpose until it shall have been countersigned by
the Warrant Agent.

 

Dated:  [          ]

 

 

ARCH COAL, INC.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

Countersigned by:

 

 

 

AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC, as Warrant Agent

 

 

 

 

 

By:

 

 

 

Authorized Signatory

 

[SIGNATURE PAGE TO WARRANT CERTIFICATE]

 

A-22

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ANNEX A

 

[Annex A to Global Warrant]5

 

The initial number of Warrants represented by this Global Warrant is [        ].

 

The following decreases in the number of Warrants represented by this Global
Warrant have been made as a result of the exercise, cancellation, exchange or
redemption of certain Warrants represented by this Global Warrant:

 

Date of Exercise/
Cancellation/
Exchange
of Warrants

 

Number of
Warrants
Exercised/
Canceled/
Exchanged

 

Total Number of
Warrants Represented
Hereby Following Such
Exercise/
Cancellation/
Exchange

 

Notation Made
by Warrant
Agent/Custodian

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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5              Include for Global Warrant.

 

A-A-1

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ANNEX B

 

FORM OF EXERCISE NOTICE

 

(TO BE EXECUTED ONLY UPON EXERCISE OF SERIES A WARRANTS)

 

DATE:           , 20     

 

TO:

American Stock Transfer & Trust Company, LLC

 

6201 15th Avenue

 

Brooklyn, NY 11219

 

Attention: Corporate Actions

 

 

RE:

Election to Purchase Common Stock

 

The undersigned registered holder of [                    ] Series A Warrants
irrevocably elects to exercise the number of Series A Warrants set forth below
represented by the Global Warrant (or, in the case of a Definitive Warrant, the
Warrant Certificate enclosed herewith), and surrenders all right, title and
interest in the number of Series A Warrants exercised hereby to the Company, and
directs that the shares of Common Stock or other securities or property
delivered upon exercise of such Series A Warrants, and any interests in the
Global Warrant or Definitive Warrant representing unexercised Series A Warrants,
be registered or placed in the name and at the address specified below and
delivered thereto.

 

Number of Series A Warrants:

 

 

 

 

 

Warrantholder:

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

Settlement:

¨ Physical Settlement and payment of $              by wire transfer of
immediately available funds

 

 

 

 

¨ Physical Settlement and payment of $              by certified or official
bank or bank cashier’s check

 

 

 

 

¨ Net Settlement

 

 

Signature guaranteed by*:

 

--------------------------------------------------------------------------------

* The signature must correspond with the name as written upon the face of the
within Warrant Certificate in every particular, without alteration or
enlargement or any change whatever, and must be guaranteed by a participant in a
Medallion Signature Guarantee Program at a guarantee level reasonably acceptable
to the Company’s transfer agent.

 

A-B-1

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Securities and/or check to be issued to:

 

If in book-entry form through the Depositary:

 

Depositary Account Number:

 

 

 

Name of Agent Member:

 

 

 

If in definitive form:

 

Social Security Number

or Other Identifying Number:

 

 

 

Name:

 

 

 

Street Address:

 

 

 

City, State and Zip Code:

 

 

 

Any unexercised Series A Warrants evidenced by the exercising Warrantholder’s
interest in the Global Warrant or Definitive Warrant, as the case may be, to be
issued to:

 

If in book-entry form through the Depositary:

 

Depositary Account Number:

 

 

 

Name of Agent Member:

 

 

 

If in definitive form:

 

Social Security Number

or Other Identifying Number:

 

 

 

Name:

 

 

 

Street Address:

 

 

 

City, State and Zip Code:

 

 

 

A-B-2

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ANNEX C

 

Form of Assignment

 

For value received, the undersigned registered Warrantholder of the within
Warrant Certificate hereby sells, assigns and transfers unto the
Assignee(s) named below (including the undersigned with respect to any Series A
Warrants constituting a part of the Series A Warrants evidenced by the within
Warrant Certificate not being assigned hereby) all of the right, title and
interest of the undersigned under the within Warrant Certificate with respect to
the number of Series A Warrants set forth below and does irrevocably constitute
and appoint [           ], the undersigned’s attorney, to make such transfer on
the books of the Company maintained for the purpose, with full power of
substitution in the premises.

 

Name of Assignees

 

Address

 

Number of Warrants

 

Social Security
Number or other
Identifying Number

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dated:

 

 

 

Holder:

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

Signature guaranteed by*:

 

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* The signature must correspond with the name as written upon the face of the
within Warrant Certificate in every particular, without alteration or
enlargement or any change whatever, and must be guaranteed by a participant in a
Medallion Signature Guarantee Program at a guarantee level reasonably acceptable
to the Company’s transfer agent.

 

A-C-1

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