EX-4.6



 




THE SECURITIES REPRESENTED HEREBY AND THE SECURITIES ISSUABLE UPON EXERCISE THEREOF HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”). THE HOLDER
HEREOF, BY PURCHASING SUCH SECURITIES, AGREES FOR THE BENEFIT OF THE COMPANY THAT SUCH SECURITIES
MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED ONLY (A) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE 1933 ACT; (B) TO THE COMPANY; OR (C) TO AN INSTITUTIONAL “ACCREDITED INVESTOR”
WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE 1933 ACT IN A
TRANSACTION THAT DOES NOT REQUIRE REGISTRATION UNDER THE 1933 ACT OR APPLICABLE STATE SECURITIES
LAWS, AND THE HOLDER SHALL FURNISH TO THE COMPANY AN OPINION TO SUCH EFFECT FROM COUNSEL OF
RECOGNIZED STANDING REASONABLY SATISFACTORY TO THE COMPANY PRIOR TO SUCH OFFER, SALE OR TRANSFER.
ANY TRANSFEREE OF THIS WARRANT SHOULD CAREFULLY REVIEW THE TERMS OF THIS WARRANT. THE NUMBER OF
COMMON SHARES ISSUABLE UPON EXERCISE HEREOF MAY BE LESS THAN THE AMOUNT SET FORTH ON THE FACE
HEREOF PURSUANT TO SECTION 1(a) HEREOF.



UNLESS PERMITTED UNDER CANADIAN SECURITIES LEGISLATION, THE HOLDER OF THE SECURITIES REPRESENTED BY
THIS CERTIFICATE AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF SHALL NOT TRADE SUCH SECURITIES
IN ONTARIO OR TO RESIDENTS OF ONTARIO BEFORE JULY 31, 2005.



THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO A SECURITIES PURCHASE AGREEMENT, DATED AS OF APRIL
27, 2005, BY AND AMONG THE COMPANY AND THE INVESTORS REFERRED TO THEREIN (THE “SECURITIES PURCHASE
AGREEMENT”) AND THE HOLDER OF THE CERTIFICATE, BY ACCEPTANCE OF THIS CERTIFICATE, AGREES TO BE
BOUND BY ALL APPLICABLE PROVISIONS OF THE SECURITIES PURCHASE AGREEMENT. THE SECURITIES
REPRESENTED HEREBY ARE SUBJECT TO A REGISTRATION RIGHTS AGREEMENT, DATED AS OF APRIL 27, 2005, BY
AND AMONG THE COMPANY AND THE INVESTORS REFERRED TO THEREIN (THE “REGISTRATION RIGHTS AGREEMENT”)
AND THE HOLDER OF THE CERTIFICATE, BY ACCEPTANCE OF THIS CERTIFICATE, AGREES TO BE BOUND BY ALL
APPLICABLE PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT, INCLUDING, WITHOUT LIMITATION, SECTION
5 THEREOF. NO TRANSFER OF THIS WARRANT SHALL BE MADE WITHOUT COMPLYING WITH THE PROVISIONS OF
SECTION 7(a) OF THIS WARRANT.




MITEL NETWORKS CORPORATION




AMENDED AND RESTATED WARRANT TO PURCHASE COMMON SHARES




Warrant No.: l

Number of Common Shares: l

Date of Issuance: April 27, 2005 (“Issuance Date”)




 









 





     Mitel Networks Corporation, a corporation incorporated under the laws of Canada (the
“Company”), hereby certifies that, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, l , the registered holder hereof or its permitted assigns
(the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, at
the Exercise Price (as defined below) then in effect, upon surrender of this Warrant to Purchase
Common Shares (including any Warrants to Purchase Common Shares issued in exchange, transfer or
replacement hereof, the “Warrant”), at any time or times on or after (the “Warrant Exercise
Eligibility Date”) the earliest of (x) the date of effectiveness of a Qualified IPO (as defined in
that certain Securities Purchase Agreement, dated as of April 27, 2005 (the “Subscription Date”),
by and among the Company and the investors (the “Buyers”) referred to therein (the “Securities
Purchase Agreement”)), (y) the date of effectiveness of any other public offering of the Common
Shares or (z) if occurring prior to the dates set forth above in clauses (x) or (y), in
contemplation of, upon and following a Fundamental Transaction (as defined below), but not after
11:59 p.m., New York Time, on the Expiration Date (as defined below), l fully paid
nonassessable Common Shares (as defined below) (the “Warrant Shares”). Except as otherwise defined
herein, capitalized terms in this Warrant shall have the meanings set forth in Section 15. This
Warrant is one of the Warrants to Purchase Common Shares (the “SPA Warrants”) issued pursuant to
Section 1 of the Securities Purchase Agreement.




	1.	 	EXERCISE OF WARRANT.






	 	(a)	 	Mechanics of Exercise. Subject to the terms and conditions hereof
(including, without limitation, the limitations set forth in Section 1(f)), this
Warrant may be exercised by the Holder on any day on or after the Warrant Exercise
Eligibility Date, in whole or in part, by (i) delivery of a written notice, in the form
attached hereto as Exhibit A (the “Exercise Notice”), of the Holder’s election
to exercise this Warrant, (ii) delivery of a signed letter substantially in the form
attached hereto as Exhibit B (the “Recertification Letter”), and (iii)(A) payment to
the Company of an amount equal to the applicable Exercise Price multiplied by the
number of Warrant Shares as to which this Warrant is being exercised (the “Aggregate
Exercise Price”) in cash or wire transfer of immediately available funds or (B) by
notifying the Company that this Warrant is being exercised pursuant to a Cashless
Exercise (as defined in Section 1(d)). The Holder shall not be required to deliver the
original Warrant in order to effect an exercise hereunder. Execution and delivery of
the Exercise Notice with respect to less than all of the Warrant Shares shall have the
same effect as cancellation of the original Warrant and issuance of a new Warrant
evidencing the right to purchase the remaining number of Warrant Shares. On or before
the second Business Day following the date on which the Company has received each of
the Exercise Notice, the Recertification Letter and the Aggregate Exercise Price (or
notice of a Cashless Exercise) (the “Exercise Delivery Documents”), the Company shall
transmit by facsimile an acknowledgment of confirmation of receipt of the Exercise
Delivery Documents to the Holder and the Company’s transfer agent (the “Transfer
Agent”). On or before the third Business Day following the date on which the Company
has received all of the Exercise Delivery Documents (the “Share Delivery Date”), the
Company shall, subject to applicable law (X) provided that the Transfer Agent is
participating in The Depository Trust




 - 2 - 









 






	 	 	 	Company (“DTC”) Fast Automated Securities Transfer Program, upon the request of the
Holder, credit such aggregate number of Common Shares to which the Holder is
entitled pursuant to such exercise to the Holder’s or its designee’s balance account
with DTC through its Deposit Withdrawal Agent Commission system, or (Y) if the
Transfer Agent is not participating in the DTC Fast Automated Securities Transfer
Program, issue and dispatch by overnight courier to the address as specified in the
Exercise Notice, a certificate, registered in the Company’s share register in the
name of the Holder or its designee, for the number of Common Shares to which the
Holder is entitled pursuant to such exercise. Upon delivery of the Exercise Notice
and Aggregate Exercise Price referred to in clause (iii)(A) above or notification to
the Company of a Cashless Exercise referred to in Section 1(d), the Holder shall be
deemed for all corporate purposes to have become the holder of record of the Warrant
Shares with respect to which this Warrant has been exercised, irrespective of the
date of delivery of the certificates evidencing such Warrant Shares. If this
Warrant is submitted in connection with any exercise pursuant to this Section 1(a)
and the number of Warrant Shares represented by this Warrant submitted for exercise
is greater than the number of Warrant Shares being acquired upon an exercise, then
the Company shall as soon as practicable and in no event later than three Business
Days after any exercise and at its own expense, issue a new Warrant (in accordance
with Section 7(d)) representing the right to purchase the number of Warrant Shares
purchasable immediately prior to such exercise under this Warrant, less the number
of Warrant Shares with respect to which this Warrant is exercised. No fractional
Common Shares are to be issued upon the exercise of this Warrant, but rather the
number of Common Shares to be issued shall be rounded up to the nearest whole
number. The Company shall pay all expenses in connection with, and all Other Taxes
and Designated Taxes, if any, that may be payable by the Company in respect of the
issuance and delivery of Warrant Shares upon exercise of this Warrant pursuant to
clause (z) of the definition herein of Warrant Exercise Eligibility Date or the
holding or disposition of the Warrant Shares after such exercise, and shall
indemnify and hold the Holder and its affiliates harmless from any taxes, interest,
penalties and governmental charges which may become payable by the Holder or any of
its affiliates as a result of the failure or delay by the Company to pay such
expenses, governmental charges, Other Taxes or Designated Taxes specified above.
For purposes hereof, “Other Taxes” means any present or future stamp, documentary or
similar issue or transfer taxes or any other excise or property taxes, charges,
governmental charges, or similar levies in respect of the issue or delivery of
Warrant Shares upon exercise of this Warrant, and “Designated Taxes” means any
liability of a non-resident of Canada for purposes of the Income Tax Act (Canada)
for Canadian income or capital gains tax arising as a result of the exercise of this
Warrant for Warrant Shares or as a consequence of the holding or disposition of this
Warrant or any Warrant Shares and any and all costs and expenses associated with
compliance with the Income Tax Act (Canada) and any analogous or similar
legislation. The Company and the Holder agree that should the exercise of the
Warrant give rise to any filing requirements, including under the Income Tax Act




 - 3 - 









 








	 	 	 	(Canada), the Company and the Holder shall cooperate fully with each other with a
view to satisfying such filing requirements.






	 	(b)	 	Exercise Price. For purposes of this Warrant, “Exercise Price” means,
subject to adjustment as provided herein, US$1.28.
	 
	 	(c)	 	Company’s Failure to Timely Deliver Securities. Subject to Section 12,
if within three (3) trading days after the Company’s receipt of the facsimile copy of a
Exercise Notice the Company shall fail to issue and deliver a certificate to the Holder
and register such Common Shares on the Company’s share register or credit the Holder’s
balance account with DTC for the number of Common Shares to which the Holder is
entitled upon such holder’s exercise hereunder, and if on or after such trading day the
Holder purchases (in an open market transaction or otherwise) Common Shares to deliver
in satisfaction of a sale by the Holder of Common Shares issuable upon such exercise
that the Holder anticipated receiving from the Company (a
“Buy-In”), then the Company
shall, within three Business Days after the Holder’s request, pay cash to the Holder in
an amount equal to the Holder’s total purchase price (including brokerage commissions,
if any) for the Common Shares so purchased (the “Buy-In
Price”), at which point the
Company’s obligation to deliver such certificate (and to issue such Common Shares)
shall terminate.
	 
	 	(d)	 	Cashless Exercise. Notwithstanding anything contained herein to the
contrary, the Holder may, in its sole discretion, exercise this Warrant in whole or in
part and, in lieu of making the cash payment otherwise contemplated to be made to the
Company upon such exercise in payment of the Aggregate Exercise Price, elect instead to
receive upon such exercise the “Net Number” of Common Shares determined according to
the following formula (a “Cashless Exercise”):





                                  
     Net Number = (A x B) - (A x C)

             
                          
        
                          
   B




                                        For purposes of the foregoing formula:





	 	 	 	A= the total number of shares with respect to which this Warrant is
then being exercised.
	 
	 	 	 	B= the arithmetic average of the Closing Sale Price of the Common
Shares during the ten (10) trading days immediately preceding the
date of the Exercise Notice.
	 
	 	 	 	C= the Exercise Price then in effect for the applicable Warrant
Shares at the time of such exercise.
	 
	 	(e)	 	Disputes. In the case of a dispute as to the determination of the
Exercise Price or the arithmetic calculation of the Warrant Shares, the Company shall
promptly issue to the Holder the number of Warrant Shares that are not disputed and
resolve such dispute in accordance with Section 12.





 - 4 - 









 






	 	(f)	 	Limitations on Exercises; Beneficial Ownership. Other than in
contemplation of, upon and following a Fundamental Transaction, the Company shall not
effect the exercise of this Warrant, and the Holder shall not have the right to
exercise this Warrant, to the extent that after giving effect to such exercise, such
Person (together with such Person’s affiliates) would beneficially own in excess of
4.99% of the Common Shares outstanding immediately after giving effect to such exercise
(the “Maximum Percentage”). For purposes of the foregoing sentence, the aggregate
number of Common Shares beneficially owned by such Person and its affiliates shall
include the number of Common Shares issuable upon exercise of this Warrant with respect
to which the determination of such sentence is being made, but shall exclude Common
Shares which would be issuable upon (i) exercise of the remaining, unexercised portion
of this Warrant beneficially owned by such Person and its affiliates and (ii) exercise
or conversion of the unexercised or unconverted portion of any other securities of the
Company beneficially owned by such Person and its affiliates (including, without
limitation, any convertible notes or convertible preferred stock or warrants) subject
to a limitation on conversion or exercise analogous to the limitation contained herein.
Except as set forth in the preceding sentence, for purposes of this paragraph,
beneficial ownership shall be calculated in accordance with Section 13(d) of the United
States Securities Exchange Act of 1934, as amended. For purposes of this Warrant, in
determining the number of outstanding Common Shares, the Holder may rely on the number
of outstanding Common Shares as reflected in (1) the Company’s most recent Form 20-F,
Form 6-K or other public filing with the United States Securities and Exchange
Commission or any Canadian regulatory authority, as the case may be, (2) a more recent
public announcement by the Company or (3) any other notice by the Company or the
Transfer Agent setting forth the number of Common Shares outstanding. For any reason
at any time, upon the written or oral request of the Holder, the Company shall within
one Business Day confirm orally and in writing to the Holder the number of Common
Shares then outstanding. In any case, the number of outstanding Common Shares shall be
determined after giving effect to the conversion or exercise of securities of the
Company, including the SPA Warrants, by the Holder and its affiliates since the date as
of which such number of outstanding Common Shares was reported. By written notice to
the Company, the Holder may increase or decrease the Maximum Percentage to any other
percentage not in excess of 9.99% specified in such notice; provided that (i) any such
increase will not be effective until the sixty-first (61st) day after such
notice is delivered to the Company, and (ii) any such increase or decrease will apply
only to the Holder and not to any other holder of SPA Warrants.






	2.	 	ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES.
The Exercise Price and
the number of Warrant Shares shall be adjusted from time to time as follows:






	 	(a)	 	Adjustment Upon Issuance of Common Shares. Prior to a Qualified IPO,
if and whenever on or after the Subscription Date the Company issues or sells, or in
accordance with this Section 2 is deemed to have issued or sold, any Common




 - 5 - 









 






	 	 	 	Shares (including the issuance or sale of Common Shares owned or held by or for the
account of the Company (but excluding Common Shares deemed to have been issued by
the Company (x) in connection with any Excluded Securities (as defined in the
Securities Purchase Agreement) or (y) to the Canadian government as warrants
exercisable for up to 12,000,000 Common Shares pursuant to the Integrated
Communications Solutions R&D Project Agreement between the Company, Mitel Knowledge
Corporation, March Networks Corporation and Her Majesty the Queen in Right of Canada
dated October 10, 2002) for a consideration per share (the “New Issuance Price”)
less than a price (the “Applicable Price”) equal to the Exercise Price in effect
immediately prior to such issue or sale or deemed issuance or sale (the foregoing a
“Dilutive Issuance”), then immediately after such Dilutive Issuance, the Exercise
Price then in effect shall be reduced in accordance with the following formula:
	 
	 	 	 	EP2
= EP1 (A+B) / (A+C), where:
	 
	 	 	 	EP2 = New Exercise Price after giving effect to the Dilutive Issuance
	 
	 	 	 	EP1 = Exercise Price in effect immediately prior to the Dilutive Issuance
	 
	 	 	 	A = Number of Common Shares deemed to be outstanding immediately prior to Dilutive
Issuance on an as-if-converted to Common Shares basis
	 
	 	 	 	B = Aggregate consideration received by the Company with respect to the Dilutive
Issuance divided by EP1 
	 
	 	 	 	C = Number of Common Shares issued in the Dilutive Issuance
	 
	 	 	 	Upon each such adjustment of the Exercise Price hereunder, the number of Warrant
Shares shall be adjusted to the number of shares of Common Stock determined by
multiplying the Exercise Price in effect immediately prior to such adjustment by the
number of Warrant Shares acquirable upon exercise of this Warrant immediately prior
to such adjustment and dividing the product thereof by the Exercise Price resulting
from such adjustment. For purposes of determining the adjusted Exercise Price under
this Section 2(a), the following shall be applicable:






	 	(i)	 	Issuance of Options. If the Company in any manner
grants any Options and the lowest price per share for which one Common Share is
issuable upon the exercise of any such Option or upon conversion, exercise or
exchange of any Convertible Securities issuable upon exercise of any such
Option is less than the Applicable Price, then such Common Share shall be
deemed to be outstanding and to have been issued and sold by the Company at the
time of the granting or sale of such Option for such price per share. For
purposes of this Section 2(a)(i), the “lowest price per share for which one
Common Share is issuable upon exercise of such Options or upon conversion,
exercise or exchange of such Convertible Securities” shall be equal to the sum
of the lowest amounts of consideration (if any)




 - 6 - 









 






	 	 	 	received or receivable by the Company with respect to any one Common Share
upon the granting or sale of the Option, upon exercise of the Option and
upon conversion, exercise or exchange of any Convertible Security issuable
upon exercise of such Option. No further adjustment of the Exercise Price
or number of Warrant Shares shall be made upon the actual issuance of such
Common Shares or of such Convertible Securities upon the exercise of such
Options or upon the actual issuance of such Common Shares upon conversion,
exercise or exchange of such Convertible Securities.
	 
	 	(ii)	 	Issuance of Convertible Securities. If the Company in
any manner issues or sells any Convertible Securities and the lowest price per
share for which one Common Share is issuable upon the conversion, exercise or
exchange thereof is less than the Applicable Price, then such Common Share
shall be deemed to be outstanding and to have been issued and sold by the
Company at the time of the issuance or sale of such Convertible Securities for
such price per share. For the purposes of this Section 2(a)(ii), the “lowest
price per share for which one Common Share is issuable upon the conversion,
exercise or exchange” shall be equal to the sum of the lowest amounts of
consideration (if any) received or receivable by the Company with respect to
one Common Share upon the issuance or sale of the Convertible Security and upon
conversion, exercise or exchange of such Convertible Security. No further
adjustment of the Exercise Price or number of Warrant Shares shall be made upon
the actual issuance of such Common Shares upon conversion, exercise or exchange
of such Convertible Securities, and if any such issue or sale of such
Convertible Securities is made upon exercise of any Options for which
adjustment of this Warrant has been or is to be made pursuant to other
provisions of this Section 2(a), no further adjustment of the Exercise Price or
number of Warrant Shares shall be made by reason of such issue or sale.
	 
	 	(iii)	 	Change in Option Price or Rate of Conversion. If the
purchase price provided for in any Options, the additional consideration, if
any, payable upon the issue, conversion, exercise or exchange of any
Convertible Securities, or the rate at which any Convertible Securities are
convertible into or exercisable or exchangeable for Common Shares increases or
decreases at any time, the Exercise Price and the number of Warrant Shares in
effect at the time of such increase or decrease shall be adjusted to the
Exercise Price and the number of Warrant Shares which would have been in effect
at such time had such Options or Convertible Securities provided for such
increased or decreased purchase price, additional consideration or increased or
decreased conversion rate, as the case may be, at the time initially granted,
issued or sold. For purposes of this Section 2(a)(iii), if the terms of any
Option or Convertible Security that was outstanding as of the date of issuance
of this Warrant are increased or decreased in the manner described in the
immediately preceding sentence, then such Option or Convertible Security and
the Common Shares deemed




 - 7 - 









 






	 	 	 	issuable upon exercise, conversion or exchange thereof shall be deemed to
have been issued as of the date of such increase or decrease. No adjustment
pursuant to this Section 2(a) shall be made if such adjustment would result
in an increase of the Exercise Price then in effect or a decrease in the
number of Warrant Shares.
	 
	 	(iv)	 	Calculation of Consideration Received. In case any
Option is issued in connection with the issue or sale of other securities of
the Company, together comprising one integrated transaction in which no
specific consideration is allocated to such Options by the parties thereto, the
Options will be deemed to have been issued for a consideration of US$0.01. If
any Common Shares, Options or Convertible Securities are issued or sold or
deemed to have been issued or sold for cash, the consideration received
therefor will be deemed to be the net amount received by the Company therefor.
If any Common Shares, Options or Convertible Securities are issued or sold for
a consideration other than cash, the amount of such consideration received by
the Company will be the fair value of such consideration, except where such
consideration consists of securities, in which case the amount of consideration
received by the Company will be the Closing Sale Price of such security on the
date of receipt. If any Common Shares, Options or Convertible Securities are
issued to the owners of the non-surviving entity in connection with any merger
in which the Company is the surviving entity or to owners of an entity with
which the Company amalgamates (the “amalgamating entity”), the amount of
consideration therefor will be deemed to be the fair value of such portion of
the net assets and business of the non-surviving entity or amalgamating entity
as is attributable to such Common Shares, Options or Convertible Securities, as
the case may be. The fair value of any consideration other than cash or
securities will be determined by the Board of Directors of the Company in good
faith.
	 
	 	(v)	 	Record Date. If the Company takes a record of the
holders of Common Shares for the purpose of entitling them (A) to receive a
dividend or other distribution payable in Common Shares, Options or in
Convertible Securities or (B) to subscribe for or purchase Common Shares,
Options or Convertible Securities, then such record date will be deemed to be
the date of the issue or sale of the Common Shares deemed to have been issued
or sold upon the declaration of such dividend or the making of such other
distribution or the date of the granting of such right of subscription or
purchase, as the case may be.
	 
	 	(vi)	 	Expiration of Options and Convertible Securities. Any
adjustment under this Section 2(a) is to be disregarded if, and to the extent
that, all of the Options or Convertible Securities that gave rise to such
adjustment expire or are cancelled without having been exercised, exchanged or
converted, so that the Exercise Price effective immediately upon such
expiration or cancellation is equal to the Exercise Price that otherwise would
have been




 - 8 - 









 






	 	 	 	in effect had such expired or cancelled Options or Convertible Securities
not been issued.






	 	(b)	 	Adjustment upon Subdivision or Combination of Common Shares. If the
Company at any time on or after the Subscription Date subdivides (by any stock split,
stock dividend, recapitalization or otherwise) one or more classes of its outstanding
Common Shares into a greater number of shares, the Exercise Price in effect immediately
prior to such subdivision will be proportionately reduced and the number of Warrant
Shares will be proportionately increased. If the Company at any time on or after the
Subscription Date combines (by combination, reverse stock split or otherwise) one or
more classes of its outstanding Common Shares into a smaller number of shares, the
Exercise Price in effect immediately prior to such combination will be proportionately
increased and the number of Warrant Shares will be proportionately decreased. Any
adjustment under this Section 2(b) shall become effective at the close of business on
the date the subdivision or combination becomes effective.
	 
	 	(c)	 	Other Events. If any event occurs of the type contemplated by the
provisions of this Section 2 but not expressly provided for by such provisions
(including, without limitation, the granting of stock appreciation rights, phantom
stock rights or other rights with equity features), then the Company’s Board of
Directors will make an appropriate adjustment in the Exercise Price and the number of
Warrant Shares so as to protect the rights of the Holder; provided that no such
adjustment pursuant to this Section 2(c) will increase the Exercise Price or decrease
the number of Warrant Shares as otherwise determined pursuant to this Section 2.
	 
	 	(d)	 	Notice of Adjustments. Upon any adjustment of the Exercise Price or of
the number or kind of securities into which this Warrant is exercisable pursuant to the
terms of this Warrant, the Company shall give written notice thereof to the Holder,
which notice shall state the Exercise Price or the number of Warrant Shares or other
securities subject to this Warrant resulting from such adjustment, as the case may be,
and shall set forth in reasonable detail the method of such calculation and the facts
upon which such calculation is based.






	3.	 	RIGHTS UPON DISTRIBUTION OF ASSETS. Subject to Section 4(a), if the Company shall
declare or make any dividend or other distribution of its assets (or rights to acquire its
assets) to holders of Common Shares, by way of return of capital or otherwise (including,
without limitation, any distribution of cash, stock or other securities, property or options
by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of
arrangement or other similar transaction) (a “Distribution”), at any time after the issuance
of this Warrant, then, in each such case:






	 	(a)	 	any Exercise Price in effect immediately prior to the close of business on the
record date fixed for the determination of holders of Common Shares entitled to receive
the Distribution shall be reduced, effective as of the close of business on such record
date, to a price determined by multiplying such Exercise Price by a fraction of which
(i) the numerator shall be the Closing Bid Price of the Common Shares on the trading
day immediately preceding such record date minus the value




 - 9 - 









 






	 	 	 	of the Distribution (as determined in good faith by the Company’s Board of
Directors) applicable to one Common Share, and (ii) the denominator shall be the
arithmetic average of the Closing Bid Price of the Common Shares during the ten (10)
trading days immediately preceding such record date; and
	 
	 	(b)	 	the number of Warrant Shares shall be increased to a number of shares equal to
the number of Common Shares obtainable immediately prior to the close of business on
the record date fixed for the determination of holders of Common Shares entitled to
receive the Distribution multiplied by the reciprocal of the fraction set forth in the
immediately preceding paragraph (a); provided that in the event that the Distribution
is of Capital Stock (“Other Capital Stock”) of a company whose Capital Stock is traded
on a national securities exchange or a national automated quotation system, then the
Holder may elect to receive a warrant to purchase Other Capital Stock in lieu of an
increase in the number of Warrant Shares, the terms of which shall be identical to
those of this Warrant, except that such warrant shall be exercisable into the number of
 shares of Other Capital Stock that would have been payable to the Holder pursuant to
the Distribution had the Holder exercised this Warrant immediately prior to such record
date and with an aggregate exercise price equal to the product of the amount by which
the exercise price of this Warrant was decreased with respect to the Distribution
pursuant to the terms of the immediately preceding paragraph (a) and the number of
Warrant Shares calculated in accordance with the first part of this paragraph (b).






	4.	 	PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS.






	 	(a)	 	Purchase Rights. If at any time the Company grants, issues or sells
any Options, Convertible Securities or rights to purchase stock, warrants, securities
or other property pro rata to the record holders of any class of Common Shares (the
“Purchase Rights”), then, upon the Holder’s election, the Holder will be entitled to
acquire, upon the terms applicable to such Purchase Rights and in lieu of any
adjustments to which the Holder is otherwise entitled under Section 3 above in respect
of such Purchase Rights, the aggregate Purchase Rights which the Holder could have
acquired if the Holder had held the number of Common Shares acquirable upon complete
exercise of this Warrant (without regard to any limitations on the exercise of this
Warrant) immediately before the date on which a record is taken for the grant, issuance
or sale of such Purchase Rights, or, if no such record is taken, the date as of which
the record holders of Common Shares are to be determined for the grant, issue or sale
of such Purchase Rights.
	 
	 	(b)	 	Fundamental Transactions. The Company shall not enter into or be party
to a Fundamental Transaction unless (i)  the Successor Entity satisfactorily assumes in
writing all of the obligations of the Company under this Warrant and the other
Transaction Documents in accordance with the provisions of this Section (4)(b),
including agreements to deliver to each holder of SPA Warrants in exchange for such SPA
Warrants a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant, including, without
limitation, an adjusted exercise price equal to the value for the Common




 - 10 - 









 






	 	 	 	Shares reflected by the terms of any Fundamental Transaction, and exercisable for a
corresponding number of shares of capital stock equivalent to the Common Shares
acquirable and receivable upon exercise of this Warrant (without regard to any
limitations on the exercise of this Warrant) prior to any Fundamental Transaction,
and (ii) either (x) the Successor Entity is a publicly traded corporation whose
Capital Stock is quoted on or listed for trading on a securities exchange or
quotation system or (y) in the case of a reclassification or recapitalization of
Common Shares only, there is no diminution in the rights of a Holder or the value of
such Common Shares. Upon the occurrence of any Fundamental Transaction, the
Successor Entity shall succeed to, and be substituted for (so that from and after
the date of such Fundamental Transaction, the provisions of this Warrant referring
to the “Company” shall refer instead to the Successor Entity), and may exercise
every right and power of the Company and shall assume all of the obligations of the
Company under this Warrant with the same effect as if such Successor Entity had been
named as the Company herein. Upon consummation of any Fundamental Transaction, the
Successor Entity shall deliver to the Holder confirmation that there shall be issued
upon exercise of this Warrant at any time after the consummation of the Fundamental
Transaction, in lieu of the Common Shares (or other securities, cash, assets or
other property) purchasable upon the exercise of the Warrant prior to such
Fundamental Transaction, such shares of stock, securities, cash, assets or any other
property whatsoever (including warrants or other purchase or subscription rights)
which the Holder would have been entitled to receive upon the happening of such
Fundamental Transaction had this Warrant been converted immediately prior to such
Fundamental Transaction, as adjusted in accordance with the provisions of this
Warrant. In addition to and not in substitution for any other rights hereunder,
prior to the consummation of any Fundamental Transaction pursuant to which holders
of Common Shares are entitled to receive securities or other assets with respect to
or in exchange for Common Shares (a “Corporate Event”), the Company shall make
appropriate provision to insure that the Holder will thereafter have the right to
receive upon an exercise of this Warrant at any time after the consummation of the
Fundamental Transaction but prior to the Expiration Date, in lieu of the Common
Shares (or other securities, cash, assets or other property) purchasable upon the
exercise of this Warrant prior to such Fundamental Transaction, such shares of
stock, securities, cash, assets or any other property whatsoever (including warrants
or other purchase or subscription rights) which the Holder would have been entitled
to receive upon the happening of such Fundamental Transaction had the Warrant been
exercised immediately prior to such Fundamental Transaction. In addition to the
foregoing, in connection with any Fundamental Transaction (other than a
reclassification or recapitalization of the Company’s Common Shares that does not
result in a diminution in the rights of a Holder or the value of such Common
Shares), the Holder shall have the right, for a period of 30 days following the
consummation of such Fundamental Transaction, to require the Company to exchange all
or any portion of the Warrants for a number of Common Shares equal to the quotient
obtained by dividing (i) the value of the Warrants as of the date of the Fundamental
Transaction determined using the Black-Scholes Pricing Model by




 - 11 - 









 






	 	 	 	(ii) the consideration paid per Common Share in such Fundamental Transaction,
provided that such right shall not apply if (x) (I) at least 90% of the
consideration (excluding cash payments for fractional shares or pursuant to
statutory appraisal rights) in such merger or consolidation consists of Capital
Stock that is, or immediately after consummation of such Fundamental Transaction
will be, traded on The New York Stock Exchange, Inc. or quoted on the Nasdaq
National Market or traded on the Toronto Stock Exchange or London Stock Exchange, in
the case of the latter two stock exchanges with a minimum market capitalization of
$1 billion (or which shall be so traded or quoted when issued or exchanged in
connection with such Fundamental Transaction) (any of these securities being
referred to as “publicly traded securities”) and (II) as a result of such merger or
consolidation the SPA Warrants become exercisable for such publicly traded
securities, excluding cash payments for fractional shares, or (y) in connection with
such Fundamental Transaction the consideration paid to all holders of Common Shares
and securities convertible into, exercisable for and exchangeable for Common Shares
is securities of an entity that is not is an affiliate of the Company and is not a
publicly traded corporation whose Capital Stock is quoted on or listed on a
securities exchange or quotation system. In connection with any Fundamental
Transaction in which all holders of Common Shares and securities convertible into,
exercisable for and exchangeable for Common Shares are solely to receive in such
Fundamental Transaction cash and/or securities of an entity that is not a publicly
traded corporation whose Capital Stock is quoted on or listed on a securities
exchange or quotation system in exchange for such securities, the Company shall have
the right to require the Holder to sell all or any portion of its Warrants to the
Company for cash payable at consummation of such Fundamental Transaction in an
amount equal to the value of the Warrants as of the date of the Fundamental
Transaction determined using the Black-Scholes Pricing Model. The provisions of
this Section shall apply similarly and equally to successive Fundamental
Transactions and Corporate Events and shall be applied without regard to any
limitations on the exercise of this Warrant.






	5.	 	NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not,
by amendment of its Articles of Incorporation, Bylaws or through any reorganization, transfer
of assets, consolidation, merger, amalgamation, scheme or plan of arrangement, 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 of this Warrant, and will at all times in good
faith carry out all the provisions of this Warrant and take all action as may be required to
protect the rights of the Holder. Without limiting the generality of the foregoing, the
Company (i) shall not increase the par value of any Common Shares receivable upon the exercise
of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions as
may be necessary or appropriate in order that the Company may validly and legally issue fully
paid and nonassessable Common Shares upon the exercise of this Warrant, and (iii) shall, so
long as any of the SPA Warrants are outstanding, take all action necessary to reserve and keep
available out of its authorized and unissued Common Shares, solely for the purpose of
effecting the exercise of the SPA Warrants, the number of Common Shares as shall from time to
time be




 - 12 - 









 






	 	 	necessary to effect the exercise of the SPA Warrants then outstanding (without regard to any
limitations on exercise).






	6.	 	WARRANT HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided
herein, the Holder, solely in such Person’s capacity as a holder of this Warrant, shall not be
entitled to vote or receive dividends or be deemed the holder of share capital of the Company
for any purpose, nor shall anything contained in this Warrant be construed to confer upon the
Holder, solely in such Person’s capacity as the Holder of this Warrant, any of the rights of a
shareholder of the Company or any right to vote, give or withhold consent to any corporate
action (whether any reorganization, issue of stock, reclassification of stock, consolidation,
merger, amalgamation, conveyance or otherwise), receive notice of meetings, receive dividends
or subscription rights, or otherwise, prior to the issuance to the Holder of the Warrant
Shares which such Person is then entitled to receive upon the due exercise of this Warrant.
In addition, nothing contained in this Warrant shall be construed as imposing any liabilities
on the Holder to purchase any securities (upon exercise of this Warrant or otherwise) or as a
shareholder of the Company, whether such liabilities are asserted by the Company or by
creditors of the Company. Notwithstanding this Section 6, the Company shall provide the
Holder with copies of the same notices and other information given to the shareholders of the
Company generally, contemporaneously with the giving thereof to the shareholders.






	7.	 	REISSUANCE OF WARRANTS.






	 	(a)	 	Transfer of Warrant. This Warrant may only be offered, sold or
otherwise transferred (a) pursuant to an effective registration statement under the
1933 Act, (b) to the Company or (c) to an institutional “accredited investor” within
the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the 1933 Act in a
transaction that does not require registration under the 1933 Act or applicable state
securities laws, and the holder shall furnish to the Company an opinion to such effect
from counsel of recognized standing reasonably satisfactory to the Company prior to
such offer, sale or transfer. If this Warrant is to be transferred, the Holder shall
surrender this Warrant to the Company, whereupon the Company will forthwith issue and
deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)),
registered as the Holder may request, representing the right to purchase the number of
Warrant Shares being transferred by the Holder and, if less then the total number of
Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in
accordance with Section 7(d)) to the Holder representing the right to purchase the
number of Warrant Shares not being transferred and the transferee shall agree to be
bound by the terms hereof.
	 
	 	(b)	 	Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of
evidence reasonably satisfactory to the Company of the loss, theft, destruction or
mutilation of this Warrant, and, in the case of loss, theft or destruction, of any
indemnification undertaking by the Holder to the Company in customary form and, in the
case of mutilation, upon surrender and cancellation of this Warrant, the Company shall
execute and deliver to the Holder a new Warrant (in accordance with Section 7(d))
representing the right to purchase the Warrant Shares then underlying this Warrant.




 - 13 - 









 






	 	(c)	 	Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon
the surrender hereof by the Holder at the principal office of the Company, for a new
Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the
right to purchase the number of Warrant Shares then underlying this Warrant, and each
such new Warrant will represent the right to purchase such portion of such Warrant
Shares as is designated by the Holder at the time of such surrender; provided, however,
that no Warrants for fractional Common Shares shall be given.
	 
	 	(d)	 	Issuance of New Warrants. Whenever the Company is required to issue a
new Warrant pursuant to the terms of this Warrant, such new Warrant (i) shall be of
like tenor with this Warrant, (ii) shall represent, as indicated on the face of such
new Warrant, the right to purchase the Warrant Shares then underlying this Warrant (or
in the case of a new Warrant being issued pursuant to Section 7(a) or Section 7(c), the
Warrant Shares designated by the Holder which, when added to the number of Common
Shares underlying the other new Warrants issued in connection with such issuance, does
not exceed the number of Warrant Shares then underlying this Warrant), (iii) shall have
an issuance date, as indicated on the face of such new Warrant which is the same as the
Issuance Date unless such Warrant was issued in connection with a transfer, and (iv)
shall have the same rights and conditions as this Warrant.






	8.	 	NOTICES. Whenever notice is required to be given under this Warrant, unless
otherwise provided herein, such notice shall be given in accordance with Section 9(f) of the
Securities Purchase Agreement. The Company shall provide the Holder with prompt written
notice of all actions taken pursuant to this Warrant, including in reasonable detail a
description of such action and the reason therefore. Without limiting the generality of the
foregoing, the Company will give written notice to the Holder (i) immediately upon any
adjustment of the Exercise Price, setting forth in reasonable detail, and certifying, the
calculation of such adjustment, (ii) at least fifteen days prior to the date on which the
Company closes its books or takes a record (A) with respect to any dividend or distribution
upon the Common Shares, (B) with respect to any grants, issuances or sales of any Options,
Convertible Securities or rights to purchase stock, warrants, securities or other property to
holders of Common Shares or (C) for determining rights to vote with respect to any Fundamental
Transaction, dissolution or liquidation, provided in each case that such information shall be
made known to the public prior to or in conjunction with such notice being provided to the
Holder and (iii) at least 15 days prior to any Fundamental Transaction (other than pursuant to
clause (iii) of such definition, in which case within one day of the Company’s knowledge of
such transaction or proposed transaction).





     The Company hereby irrevocably appoints Mitel Networks, Inc. at 205 Van Buren Street, Herndon,
Virginia 20170, Telephone: (613) 592-2122, Facsimile: (613) 592-7802, Attention: Greg Hiscock,
Corporate Counsel, as its agent for the receipt of service of process in connection with any action
pursuant to this Warrant in the United States. The Company agrees that any document may be
effectively served on it in connection with any action, suit or proceeding in the United States by
service on its agents.




 - 14 - 












 






	 	 	     Any document shall be deemed to have been duly served if marked for the attention of the agent
at its address (as set out above) or such other address in the United States as may be notified to
the party wishing to serve the document and delivered in accordance with the notice provisions set
forth in this Section 8.
	 
	 	 	     If the Company’s agent at any time ceases for any reason to act as such, the Company shall
appoint a replacement agent having an address for service in the United States and shall notify the
Holder in writing of the name and address of the replacement agent. Failing such appointment and
notification, the Holder shall be entitled by notice to the Company to appoint a replacement agent
to act on the Company’s behalf. The provisions of this Section 8 applying to service on an agent
apply equally to service on a replacement agent.






	9.	 	AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this
Warrant may be amended and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company has obtained the
written consent of the Required Holders; provided that no such action may increase the
exercise price of any SPA Warrant or decrease the number of shares or class of stock
obtainable upon exercise of any SPA Warrant without the written consent of the Holder. No
such amendment shall be effective to the extent that it applies to less than all of the
holders of the SPA Warrants then outstanding.






	10.	 	GOVERNING LAW; JURISDICTION; JURY TRIAL.






	 	(i)	 	All questions concerning the construction, validity,
enforcement and interpretation of this Warrant shall be governed by the
internal laws of the State of New York, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New York or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. Subject to Section 12, each
party hereby irrevocably submits to the exclusive jurisdiction of the state and
federal courts sitting in The City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to such
party at the address for such notices to it under this Warrant and agrees that
such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any
right to serve process in any manner permitted by law. EACH PARTY
HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY
TRIAL FOR THE




-15-









 






	 	 	 	ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR
ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.






	 	(ii)	 	If for the purpose of obtaining or enforcing judgment against
the Company in any court in any jurisdiction it becomes necessary to convert
into any other currency (such other currency being hereinafter in this
paragraph referred to as the “Judgment Currency”) an amount due in US dollars
under this Warrant, the conversion shall be made at the exchange rate between
United States Dollars and Canadian Dollars as reported in the New York edition
of The Wall Street Journal (the “Exchange Rate”) prevailing on the business day
immediately preceding:






	 	(A)	 	the date of actual payment of the amount due,
in the case of any proceeding in the courts of New York or in the
courts of any other jurisdiction that will give effect to such
conversion being made on such date: or
	 
	 	(B)	 	the date on which the foreign court determines,
in the case of any proceeding in the courts of any other jurisdiction
(the date as of which such conversion is made pursuant to this
paragraph (ii)(B) being hereinafter referred to as the “Judgment
Conversion Date”).






	 	(iii)	 	If in the case of any proceeding in the court of any
jurisdiction referred to in paragraph (ii)(B) above, there is a change in the
Exchange Rate prevailing between the Judgment Conversion Date and the date of
actual payment of the amount due, the applicable party shall pay such adjusted
amount as may be necessary to ensure that the amount paid in the Judgment
Currency, when converted at the Exchange Rate prevailing on the date of
payment, will produce the amount of US dollars which could have been purchased
with the amount of Judgment Currency stipulated in the judgment or judicial
order at the Exchange Rate prevailing on the Judgment Conversion Date.
	 
	 	(iv)	 	Any amount due from the Company under this provision shall be
due as a separate debt and shall not be affected by judgment being obtained for
any other amounts due under or in respect of this Warrant.






	11.	 	CONSTRUCTION; HEADINGS. This Warrant shall be deemed to be jointly drafted by the
Company and all the Buyers and shall not be construed against any person as the drafter
hereof. The headings of this Warrant are for convenience of reference and shall not form part
of, or affect the interpretation of, this Warrant.
	 
	12.	 	DISPUTE RESOLUTION. In the case of a dispute as to the determination of the Exercise
Price or the arithmetic calculation of the Warrant Shares, the Company shall
submit the disputed determinations or arithmetic calculations via facsimile within two
Business Days of receipt of the Exercise Notice giving rise to such dispute, as the case




-16-









 






	 	 	may
be, to the Holder. If the Holder and the Company are unable to agree upon such
determination or calculation of the Exercise Price or the Warrant Shares within three
Business Days of such disputed determination or arithmetic calculation being submitted to
the Holder, then the Company shall, within two Business Days submit via facsimile (a) the
disputed determination of the Exercise Price to an independent, reputable investment bank
selected by the Company and approved by the Holder or (b) the disputed arithmetic
calculation of the Warrant Shares to the Company’s independent, outside accountant. The
Company shall cause at its expense the investment bank or the accountant, as the case may
be, to perform the determinations or calculations and notify the Company and the Holder of
the results no later than ten Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s determination or
calculation, as the case may be, shall be binding upon all parties absent demonstrable
error.
	 
	13.	 	REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided
in this Warrant shall be cumulative and in addition to all other remedies available under this
Warrant and the other Transaction Documents, at law or in equity (including a decree of
specific performance and/or other injunctive relief), and nothing herein shall limit the right
of the Holder to pursue actual damages for any failure by the Company to comply with the terms
of this Warrant. The Company acknowledges that a breach by it of its obligations hereunder
will cause irreparable harm to the Holder and that the remedy at law for any such breach may
be inadequate. The Company therefore agrees that, in the event of any such breach or
threatened breach, the holder of this Warrant shall be entitled, in addition to all other
available remedies, to an injunction restraining any breach, without the necessity of showing
economic loss and without any bond or other security being required.
	 
	14.	 	TRANSFER. Subject to Section 7 hereof, this Warrant may be offered for sale, sold,
transferred or assigned without the consent of the Company.
	 
	15.	 	CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have
the following meanings:






	 	(a)	 	“Bloomberg” means Bloomberg Financial Markets.
	 
	 	(b)	 	“Business Day” means any day other than Saturday, Sunday or other day on which
commercial banks in The City of New York are authorized or required by law to remain
closed.
	 
	 	(c)	 	“Capital Stock” means any and all shares, interests, participations, rights or
other equivalents (however designated) of corporate stock, including, without
limitation, with respect to partnerships, partnership interests (whether general or
limited) and any other interest or participation that confers on a Person the right to
receive a share of the profits and losses of, or distributions of assets of, such
partnership.
	 
	 	(d)	 	“Closing Bid Price” and “Closing Sale Price” means, for any security as of any
date, the last closing bid price and last closing trade price, respectively, for such




-17-









 






	 	 	 	security on the Principal Market, as reported by Bloomberg, or, if the Principal Market
begins to operate on an extended hours basis and does not designate the closing bid
price or the closing trade price, as the case may be, then the last bid price or last
trade price, respectively, of such security prior to 4:00 p.m., New York Time, as
reported by Bloomberg, or, if the Principal Market is not the principal securities
exchange or trading market for such security, the last closing bid price or last trade
price, respectively, of such security on the principal securities exchange or trading
market where such security is listed or traded as reported by Bloomberg, or if the
foregoing do not apply, the last closing bid price or last trade price, respectively,
of such security in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, or, if no closing bid price or last trade
price, respectively, is reported for such security by Bloomberg, the average of the bid
prices, or the ask prices, respectively, of any market makers for such security as
reported in the “pink sheets” by Pink Sheets LLC (formerly the National Quotation
Bureau, Inc.). If the Closing Bid Price or the Closing Sale Price cannot be calculated
for a security on a particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such security on such date
shall be the fair market value as determined by the Board of Directors of the Company
in good faith. All such determinations to be appropriately adjusted for any stock
dividend, stock split, reclassification, reorganization, recapitalization, combination,
reverse stock split or other similar event during the applicable calculation period.


	 
	 	(e)	 	“Common Shares” means (i) the Company’s Common Shares, no par value, and (ii)
any share capital into which such Common Shares shall have been changed or any share
capital resulting from a reclassification of such Common Shares.
	 
	 	(f)	 	“Convertible Securities” means any stock or securities (other than Options)
directly or indirectly convertible into or exercisable or exchangeable for Common
Shares.
	 
	 	(g)	 	“Eligible Market” means the American Stock Exchange, The New York Stock
Exchange, Inc., the Nasdaq Global Select Market, the Nasdaq Global Market, the Toronto
Stock Exchange or the London Stock Exchange.
	 
	 	(h)	 	“Expiration Date” means August 16, 2012, or if such date falls on a day other
than a Business Day or on which trading does not take place on the Principal Market (a
“Holiday”), the next date that is not a Holiday.
	 
	 	(i)	 	“Fundamental Transaction” means (a) that the Company shall, directly or
indirectly, in one or more related transactions, (i) consolidate or merge with or into
(whether or not the Company is the surviving corporation) or amalgamate with another
Person, or (ii) sell, assign, transfer, convey or otherwise dispose of all or
substantially all of the properties or assets of the Company to another Person, or
(iii) allow another Person to make, or fail to prevent another Person from making, a
purchase, tender or exchange offer that is accepted by the holders
of more than the 50% of the outstanding Common Shares (not including any Common
Shares held by the Person or Persons making or party to, or associated




-18-









 






	 	 	or affiliated
with the Persons making or party to, such purchase, tender or exchange offer), or
(iv) consummate a stock purchase agreement or other business combination (including,
without limitation, a reorganization, recapitalization, spin-off or scheme or plan
of arrangement) with another Person whereby such other Person acquires more than the
50% of the outstanding Common Shares (not including any Common Shares held by the
other Person or other Persons making or party to, or associated or affiliated with
the other Persons making or party to, such stock purchase agreement or other
business combination), or (v) reorganize, recapitalize or reclassify its Common
Shares or (b) any event, whether by a single transaction or a series of
transactions, that results in Dr. Terence H. Matthews and the Matthews Persons,
collectively, “beneficially owning” (within the meaning of Rule 13d-3 under the
Exchange Act), directly or indirectly, in the aggregate less than 115,000,000 of the
issued and outstanding shares in the capital of the Company (subject to appropriate
adjustments for share dividends, share splits, recapitalizations, combinations,
reverse share splits or other similar events occurring after the Issuance Date), in
each case calculated on an as-if-converted to Common Shares basis; and “Matthews
Persons” means the immediate family of Terence H. Matthews and any “person” or
“group” under Section 13(d)(3) of the United States Securities and Exchange Act of
1934 that is controlled solely by Terence H. Matthews or his immediate family, any
beneficiary of the estate of Terence H. Matthews or his immediate family or any
trust or partnership controlled by any of the foregoing.






	  (j)	 	“Options” means any rights, warrants or options to subscribe for or purchase
Common Shares or Convertible Securities.
	 
	  (k)	 	“Parent Entity” of a Person means an entity that, directly or indirectly,
controls the applicable Person and whose common stock or equivalent equity security is
quoted or listed on an Eligible Market, or, if there is more than one such Person or
Parent Entity, the Person or Parent Entity with the largest public market
capitalization as of the date of consummation of the Fundamental Transaction.
	 
	  (l)	 	“Person” means an individual, a limited liability company, a partnership, a
joint venture, a corporation, a trust, an unincorporated organization, any other entity
and a government or any department or agency thereof.
	 
	  (m)	 	“Principal Market” means The New York Stock Exchange, Inc., the Nasdaq National
Market, the Toronto Stock Exchange or the London Stock Exchange as the case may be.
	 
	  (n)	 	“Required Holders” means the holders of the SPA Warrants representing at least
a majority of Common Shares underlying the SPA Warrants then outstanding.
	 
	  (o)	 	“Successor Entity” means the Person (or, if so elected by the Required Holders,
the Parent Entity) formed by, resulting from, continuing from or surviving any
Fundamental Transaction or the Person (or, if so elected by the Required Holders,
the Parent Entity) with which such Fundamental Transaction shall have been entered
into.





-19-









 











	16.	 	CURRENCY. Unless otherwise indicated, all dollar amounts referred to in this Warrant
are in United States Dollars.





[Signature Page Follows]




-20-









 








     IN WITNESS WHEREOF, the Company has caused this Warrant to Purchase Common Shares to be duly
executed as of the Issuance Date set out above.



	 	 	 	 	 
	 	MITEL NETWORKS CORPORATION

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 



[Signature page to Amended and Restated Warrant to Purchase Common Shares]




 









 










EXHIBIT A




EXERCISE NOTICE






TO BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS

WARRANT TO PURCHASE COMMON SHARES







MITEL NETWORKS CORPORATION





     The undersigned holder hereby exercises the right to purchase                                         of the Common
Shares (“Warrant Shares”) of Mitel Networks Corporation, a corporation incorporated under the laws
of Canada (the “Company”), evidenced by the attached Warrant to Purchase Common Shares (the
“Warrant”). Capitalized terms used herein and not otherwise defined shall have the respective
meanings set forth in the Warrant.



     1. Form of Exercise Price. The Holder intends that payment of the Exercise Price shall be
made as:



	 	 	 	 	 	 	 
	 

	 	 	 	a   “Cash
Exercise” with respect to	 	 
	 

	 	 

	 	Warrant Shares; and/or
	 	 
 
	 

	 	 	 	a   “Cashless
Exercise” with respect to	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	Warrant Shares.
	 	 






     2. Payment of Exercise Price. In the event that the holder has elected a Cash Exercise with
respect to some or all of the Warrant Shares to be issued pursuant hereto, the holder shall pay the
Aggregate Exercise Price in the sum of US$______ to the Company in accordance with the
terms of the Warrant.



     3. Delivery
of Warrant Shares. The Company shall deliver to the holder ______ Warrant
Shares in accordance with the terms of the Warrant.



Date: _______________ __, ______




	 	 	 	 	 
	 	 	 
	   Name of Registered Holder	 	 
	 
	By:

	 	 	 	 
	 

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 






 









 






ACKNOWLEDGMENT




     The Company hereby acknowledges this Exercise Notice and hereby directs [Insert Name of
Transfer Agent] to issue the above indicated number of Common Shares to [Insert Name of Holder] in
accordance with the Transfer Agent Instructions dated                     , from the Company and acknowledged
and agreed to by [Insert Name of Transfer Agent].



	 	 	 	 	 
	 	MITEL NETWORKS CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 









 






	 	 	 	 	 



EXHIBIT B




Form of Letter to be Delivered

upon Exercise of Warrants




Mitel Networks Corporation




Dear Sirs:





          We are delivering this letter in connection with the purchase of common shares (the “Shares”)
of Mitel Networks Corporation (the “Company”), a corporation existing under the laws of Canada,
upon the exercise of warrants of the Company (“Warrants”).



          We hereby confirm that:



     (a) we are an institutional “accredited investor” within the meaning of Rule 501
(a)(1),(2),(3) or (7) of Regulation D under the United States Securities Act of 1933 (the “1933
Act”);



     (b) we are purchasing the Shares for our own account;



     (c) we have such knowledge and experience in financial and business matters that we are
capable of evaluating the merits and risks of purchasing the Shares;



     (d) we are not acquiring the Shares with a view to distribution thereof or with any present
intention of offering or selling any of the Shares, except (A) pursuant to an effective
registration statement under the 1933 Act; (B) to the Company; (C) outside the United States in
accordance with Rule 904 of Regulation S under the 1933 Act and in compliance with applicable local
laws; or (D) within the United States (1) in accordance with the exemption from registration under
the 1933 Act provided by Rule 144 or Rule 144A thereunder, if available, and in compliance with any
applicable state securities laws or (2) in a transaction that does not require registration under
the 1933 Act or applicable state securities laws, and the offeror, seller or transferor shall
furnish to the Company an opinion to such effect from counsel of recognized standing reasonably
satisfactory to the Company prior to such offer, sale or transfer.



     (e) we acknowledge that we have had access to such financial and other information as we deem
necessary in connection with our decision to purchase the Shares; and



     (f) we acknowledge that we are not purchasing the Shares as a result of any general
solicitation or general advertising (as such terms are defined under Regulation D under the 1933
Act), including advertisements, articles, notices or other communications published in any
newspaper, magazine or similar media or broadcast over radio, television, or any seminar or meeting
whose attendees have been invited by general solicitation or general advertising.



 









 





     We understand that the Shares are being offered in a transaction not involving any public
offering within the United States within the meaning of the 1933 Act and that the Shares have not
been and, other than under the Registration Rights Agreement dated as of April
27, 2005 among the Company and the other parties thereto, will not be registered under the 1933
Act. We further understand that any Shares acquired by us will be in the form of definitive
physical certificates and that such certificates will bear a legend reflecting the substance of
paragraph (d) above.



     We acknowledge that you will rely upon our confirmations, acknowledgements and agreements set
forth herein, and we agree to notify you promptly in writing if any of our representations or
warranties herein ceases to be accurate or complete.



	 	 	 	 	 
	     (Name of Holder)	 	 
	 
	 	 	 	 
	     By:

	 	 	 	 
	 

	 	Name:	 	 
	 

	 	Title:	 	 
	 
	 	 	 	 
	 

	 	Address: