exv4w2






Exhibit 4.2




EXECUTION COPY




      




BIOSCRIP, INC.




 





WARRANT AGREEMENT



 





Dated As Of March 25, 2010




Warrants to Purchase 3,400,945 shares of Common Stock



 





 









 








TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	1. FORM, EXECUTION AND TRANSFER OF WARRANT CERTIFICATES
	 	 	1	 
	1.1. Form of Warrant Certificates
	 	 	1	 
	1.2. Execution of Warrant Certificates; Registration Books
	 	 	2	 
	1.3. Transfer, Split Up, Combination and Exchange of Warrant Certificates; Lost or Stolen Warrant Certificates
	 	 	2	 
	1.4. Subsequent Issuance of Warrant Certificates
	 	 	3	 
	1.5. Effect of Issuance in Registered Form
	 	 	4	 
	 
	 	 	 	 
	2. EXERCISE OF WARRANTS; PAYMENT OF EXERCISE PRICE
	 	 	4	 
	2.1. Exercise of Warrants
	 	 	4	 
	2.2. Issuance of Common Stock
	 	 	5	 
	2.3. Unexercised Warrants
	 	 	6	 
	2.4. Cancellation and Destruction of Warrant Certificates
	 	 	6	 
	2.5. Expiration
	 	 	6	 
	2.6. Fractional shares of Common Stock
	 	 	6	 
	 
	 	 	 	 
	3. AGREEMENTS OF THE COMPANY
	 	 	6	 
	3.1. Reservation of Common Stock
	 	 	6	 
	3.2. Common Stock To Be Duly Authorized and Issued, Fully Paid and Nonassessable etc; Compliance with Law
	 	 	7	 
	3.3. Taxes
	 	 	7	 
	3.4. Common Stock Record Date
	 	 	7	 
	3.5. Rights in Respect of Common Stock
	 	 	8	 
	3.6. Noncircumvention
	 	 	8	 
	 
	 	 	 	 
	4. ANTI-DILUTION ADJUSTMENTS
	 	 	8	 
	4.1. Adjustments
	 	 	8	 
	4.2. Stock Splits, Subdivisions, Reclassifications or Combinations
	 	 	8	 
	4.3. Price Based Anti-Dilution
	 	 	9	 
	4.4. Other Distributions
	 	 	11	 
	4.5. Business Combinations
	 	 	11	 
	4.6. Expiration of Rights or Options
	 	 	12	 
	4.7. Rounding of Calculations; Minimum Adjustments
	 	 	13	 
	4.8. Timing of Issuance of Additional Common Stock Upon Certain Adjustments
	 	 	13	 
	4.9. Miscellaneous
	 	 	13	 
	 
	 	 	 	 
	5. INTERPRETATION OF THIS AGREEMENT
	 	 	14	 
	5.1. Certain Defined Terms
	 	 	14	 
	5.2. Section Heading and Table of Contents and Construction
	 	 	18	 
	5.3. Directly or Indirectly
	 	 	18	 
	5.4. Governing Law
	 	 	19	 






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	 	 	Page	 
	6. MISCELLANEOUS
	 	 	19	 
	6.1. Expenses
	 	 	19	 
	6.2. Amendment and Waiver
	 	 	19	 
	6.3. Warrants Subject to Stockholders’ Agreement
	 	 	19	 
	6.4. Entire Agreement
	 	 	20	 
	6.5. Successors and Assigns
	 	 	20	 
	6.6. Notices
	 	 	20	 
	6.7. Severability
	 	 	21	 
	6.8. Execution in Counterpart
	 	 	21	 
	6.9. Waiver of Jury Trial; Consent to Jurisdiction, Etc.
	 	 	21	 






	 	 	 	 	 
	Attachment A

	 	—
	 	Form of Warrant Certificate
	Annex 1

	 	—
	 	Warrants Issuable to the Purchasers
	Annex 2

	 	—
	 	Address of Purchasers for Notices
	Annex 3

	 	—
	 	Address of Company for Notices








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BIOSCRIP, INC.




Warrant Agreement



 





Warrants for Common Stock



     WARRANT AGREEMENT, dated as of March 25, 2010, among BioScrip, Inc., a Delaware corporation
(together with its successors and assigns, the “Company”), and Kohlberg Investors V, L.P.,
a Delaware limited partnership, Kohlberg Partners V, L.P., a Delaware limited partnership, Kohlberg
Offshore Investors V, L.P., a Delaware limited partnership, Kohlberg TE Investors V, L.P., a
Delaware limited partnership, KOCO Investors V, L.P., a Delaware limited partnership, Robert
Cucuel, Mary Jane Graves, Nitin Patel, Joey Ryan, Colleen Lederer, Blackstone Mezzanine Partners II
L.P., a Delaware limited partnership, Blackstone Mezzanine Holdings II L.P., a Delaware limited
partnership, and S.A.C. Domestic Capital Funding, Ltd., a Cayman Islands limited company
(collectively and together with each of their respective successors and assigns, the
“Purchasers”). Capitalized terms shall have the meaning specified in Section 5.1
hereof.



RECITALS




     WHEREAS, pursuant to the Merger Agreement, the Purchasers have agreed to acquire from the
Company, and the Company has agreed to issue to the Purchasers, Warrants to purchase the number of
shares of Common Stock set forth opposite such Person’s name on Annex 1 attached hereto,
which Warrants represent the right to purchase, in the aggregate, 3,400,945 shares of Common Stock,
subject to adjustment as set forth herein; and



     WHEREAS, the Company and the Purchasers wish to enter into this Agreement to govern the terms
of the Warrants.



AGREEMENT




     NOW, THEREFORE, in consideration of the premises and the mutual agreements set forth herein,
the parties to this Agreement hereby agree as follows:



1. FORM, EXECUTION AND TRANSFER OF WARRANT CERTIFICATES.




     1.1. Form of Warrant Certificates.



     The Warrant Certificates shall be in the form set forth in Attachment A hereto. The
Warrant Certificates may have such letters, numbers or other marks of identification or designation
as may be required to comply with any law or with any rule or regulation of any governmental
authority, stock exchange or self-regulatory organization made pursuant thereto
(“Law”). Each Warrant Certificate shall be dated the date of issuance thereof by the
Company, either upon initial issuance or upon transfer or exchange. Each Warrant Certificate shall
represent the right to purchase the number of shares of Common Stock set forth in such Warrant



 









 







Certificate at a price per share of Common Stock equal to the Exercise Price; provided, that the
number of shares of Common Stock issuable upon exercise of the Warrants and the Exercise Price
thereof shall be subject to adjustment as provided herein.




	 	1.2.	 	Execution of Warrant Certificates; Registration Books.






     (a) Execution of Warrant Certificates. The Warrant Certificates shall be executed on
behalf of the Company by an officer of the Company authorized by the Board of Directors. In
case the officer of the Company who shall have signed any Warrant Certificate shall cease to
be such an officer of the Company before issuance and delivery by the Company of such
Warrant Certificate, such Warrant Certificate nevertheless may be issued and delivered with
the same force and effect as though the individual who signed such Warrant Certificate had
not ceased to be such an officer of the Company, and any Warrant Certificate may be signed
on behalf of the Company by any individual who, at the actual date of the execution of such
Warrant Certificate, shall be a proper officer of the Company to sign such Warrant
Certificate, although at the date of the execution of this Agreement any such individual was
not such an officer.




     (b) Registration Books. The Company will keep or cause to be kept at its office,
maintained at the address of the Company referenced in Section 6.6, at the Company’s
transfer agent, or at such other office of the Company of which the Company shall have given
notice to each holder of Warrant Certificates, books for registration and transfer of the
Warrant Certificates issued hereunder. Such books shall show the names and addresses of the
respective holders of the Warrant Certificates, the registration number and date of each of
the Warrant Certificates and the Denomination thereof.



     1.3. Transfer, Split Up, Combination and Exchange of Warrant Certificates; Lost or
Stolen Warrant Certificates.




     (a) Transfer, Split Up, etc.




          (i) Transfer. Subject to compliance with the Securities Act, any
applicable state securities laws and the Stockholders’ Agreement, any Warrant
Certificate (or portion thereof), with or without other Warrant Certificates, may be
transferred to any Person for a Warrant Certificate or Warrant Certificates in an
aggregate like Denomination as the Warrant Certificate or Warrant Certificates (or
portions thereof) surrendered then entitled such registered holder to purchase. Any
registered holder desiring to transfer any Warrant Certificate shall make such
request in writing delivered to the Company, which request shall include the
identity of the Transferee and the aggregate number of Warrants to be transferred,
and shall surrender the Warrant Certificate or Warrant Certificates



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(or portions thereof) to be transferred at the office of the Company referenced in
Section 6.6, whereupon the Company shall deliver promptly to such Transferee
a Warrant Certificate or Warrant Certificates, as the case may be, as so requested,
which Warrant Certificate or Warrant Certificates shall evidence, collectively, the
same aggregate number of Warrants as the Warrant Certificate or Warrant Certificates
(or portions thereof) so surrendered for transfer and shall issue a new Warrant
Certificate to the transferor representing the Warrants retained by the Transferor
if such transfer involved less than the entire number of Warrants held by such
Transferor.




          (ii) Split Up, Combination, Exchange, etc. Any Warrant Certificate,
with or without other Warrant Certificates, may be split up, combined or exchanged
for another Warrant Certificate or Warrant Certificates, in an aggregate like
Denomination as the Warrant Certificate or Warrant Certificates surrendered then
entitle such registered holder to purchase. Any registered holder desiring to split
up, combine or exchange any Warrant Certificate shall make such request in writing
delivered to the Company, and shall surrender the Warrant Certificate or Warrant
Certificates to be split up, combined or exchanged at the office of the Company
referenced in Section 6.6, whereupon the Company shall deliver promptly to
such registered holder a Warrant Certificate or Warrant Certificates, as the case
may be, as so requested, which Warrant Certificate or Warrant Certificates shall
evidence, collectively, the same aggregate Denomination as the Warrant Certificate
or Warrant Certificates so surrendered for split-up, combination or exchange.




     (b) Loss, Theft, etc. Upon receipt by the Company of evidence reasonably satisfactory
to it of the ownership of, and the loss, theft, destruction or mutilation of, any Warrant
Certificate, and:




     (i) in the case of loss, theft or destruction, an affidavit of loss, together
with a customary and reasonable indemnity; or




     (ii) in the case of mutilation, upon surrender and cancellation thereof;




the Company at its own expense will execute and deliver, in lieu thereof, a new Warrant
Certificate, dated the date of such lost, stolen, destroyed or mutilated Warrant Certificate
and of like tenor, in lieu of the lost, stolen, destroyed or mutilated Warrant Certificate
and evidencing the same Denomination as the Warrant Certificate so lost, stolen, destroyed
or mutilated.



     1.4. Subsequent Issuance of Warrant Certificates.




Subsequent to the original issuance, no Warrant Certificates shall be issued except:




     (a) Warrant Certificates issued upon any transfer, combination, split up or exchange of
Warrants pursuant to Section 1.3(a);




     (b) Warrant Certificates issued in replacement of mutilated, destroyed, lost or stolen
Warrant Certificates pursuant to Section 1.3(b);



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     (c) Warrant Certificates issued pursuant to Section 2.3 upon the partial
exercise of any Warrant Certificate to evidence the unexercised portion of such Warrant
Certificate; and




     (d) Warrant Certificates to reflect any adjustments pursuant to Section 4.



     1.5. Effect of Issuance in Registered Form.



     Every holder of a Warrant Certificate by accepting the same consents and agrees with the
Company and with every other holder of a Warrant Certificate that:




     (a) the Warrant Certificates, to the extent then currently transferable, are
transferable only on the registry books of the Company if and when surrendered at the office
of the Company referenced in Section 6.6, duly endorsed or accompanied by an
instrument of transfer (in the form attached thereto) and payment of any applicable
transfer, stamp or issue tax (a “Tax”); and




     (b) the Company may deem and treat the Person in whose name each Warrant Certificate is
registered as the absolute owner thereof and of the Warrants evidenced thereby
(notwithstanding any notations of ownership or writing on the Warrant Certificates made by
anyone other than the Company) for all purposes whatsoever, and the Company shall not be
affected by any notice to the contrary.



2. EXERCISE OF WARRANTS; PAYMENT OF EXERCISE PRICE.




     2.1. Exercise of Warrants.




     (a) Manner of Exercise. At any time and from time to time prior to the Expiration
Time, the holder of any Warrant Certificate may exercise the Warrants evidenced thereby, in
whole or in any part, by surrender to the Company, at its office referenced in Section
6.6, of such Warrant Certificate, together with a duly executed election to purchase (a
form of which is attached to each Warrant Certificate) and payment of the applicable
Exercise Price for each share of Common Stock with respect to which the Warrants are then
being exercised and an amount equal to any applicable Tax
(if not payable by the Company as provided in Section 3.3). Such Exercise Price
shall be payable either:




	 	(i)	 	in cash pursuant to Section 2.1(b); or
	 
	 	(ii)	 	by delivery of Warrant Certificates pursuant to Section 2.1(c).






     (b) Payment in Cash. Upon exercise of any Warrants, the holder of a Warrant
Certificate may pay the Exercise Price by certified or official bank check payable to the
order of the Company or by wire transfer of immediately available funds to the account of
the Company.



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     (c) Net Exercise. In the event that any holder of Warrant Certificates delivers such
Warrant Certificates to the Company and notifies the Company in writing that such holder
intends to exercise all, or any portion of, the Warrants represented by such Warrant
Certificates to satisfy its obligation to pay the Exercise Price in respect thereof by
virtue of the provisions of this Section 2.1(c), such holder shall become entitled
to receive, instead of the number of shares of Common Stock such holder would have received
had the Exercise Price been paid pursuant to Section 2.1(b), a number of shares of
Common Stock in respect of the exercise of such Warrants equal to the product of:




     (i) the number of shares of Common Stock issuable upon such exercise of such
Warrant Certificate (or, if only a portion of such Warrant Certificate is being
exercised, issuable upon the exercise of such portion); multiplied by




     (ii) the quotient of:




     (A) the difference of:




     (I) the Market Price per share of Common Stock at the time of
such exercise; minus




     (II) the Exercise Price per share of Common Stock at the time of
such exercise;




divided by




     (B) the Market Price per share of Common Stock at the time of such
exercise.




     (d) Fractional shares of Common Stock. The Company may, in accordance with Section
2.6, pay the exercising holder cash in lieu of issuing a fractional share in connection
with an exercise of Warrants; provided that, if it does not issue a fractional share in such
circumstances, it will make such cash payment.




     (e) Automatic Exercise. Notwithstanding anything herein to the contrary, any Warrants
issued hereunder shall be fully exercised pursuant to Section 2.1(c), without the
need for any action by the holder thereof or the Company, immediately prior to the
Expiration Time, provided that upon such automatic exercise the resulting value is greater
than zero.



     2.2. Issuance of Common Stock.



     Upon timely receipt of a Warrant Certificate, accompanied by the form of election to purchase
duly executed, and payment of the Exercise Price for each of the shares of the Common Stock to be
purchased (if payable in the manner provided in Section 2.1(a)(i)) and by an amount equal
to any applicable Tax (if not payable by the Company as provided in Section 3.3), the
Company shall thereupon promptly cause certificates representing the number of whole shares of



5









 







Common Stock then being purchased to be delivered to or upon the order of the registered holder of
such Warrant Certificate, registered in such name or names as may be designated by such holder,
and, promptly after such receipt deliver the cash, if any, to be paid in lieu of fractional shares
pursuant to Section 2.6 to or upon the order of the registered holder of such Warrant
Certificate.



     2.3. Unexercised Warrants.



     In the event that the registered holder of any Warrant Certificate shall exercise less than
all the Warrants evidenced thereby, a new Warrant Certificate evidencing Warrants equal in number
to the number of Warrants remaining unexercised shall be issued by the Company to the registered
holder of such Warrant Certificate or to its duly authorized assigns.



     2.4. Cancellation and Destruction of Warrant Certificates.



     All Warrant Certificates surrendered to the Company for the purpose of exercise, exchange,
substitution or transfer shall be cancelled by it, and no Warrant Certificates shall be issued in
lieu thereof except as expressly permitted by any of the provisions of this Agreement. The Company
shall cancel and retire any other Warrant Certificates purchased or acquired by the Company
otherwise than upon the exercise thereof.



     2.5. Expiration.



     All Warrants that have not been exercised or purchased in accordance with the provisions of
this Agreement shall expire and all rights of holders of such Warrants shall terminate and cease at
the Expiration Time.



     2.6. Fractional shares of Common Stock.



     The Company shall not be required to issue fractional shares of Common Stock upon the exercise
of any Warrant. If fractional shares are not issued upon the exercise of any Warrant, there shall
be paid to the holder thereof, in lieu of any fractional share of Common Stock resulting therefrom,
an amount of cash equal to the product of:




     (a) the fractional amount of such share of Common Stock; and




     (b) the Market Price, as determined on the trading day immediately prior to the date of
exercise of such Warrant.



3. AGREEMENTS OF THE COMPANY.




     3.1. Reservation of Common Stock.



     The Company covenants and agrees that it will at all times cause to be reserved and kept
available out of its authorized and unissued shares or treasury shares of Common Stock such number
of shares of Common Stock as will be sufficient to permit the exercise in full of all Warrants
issued hereunder into Common Stock.



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	 	3.2.	 	Common Stock To Be Duly Authorized and Issued, Fully Paid and Nonassessable
etc; Compliance with Law





     The Company covenants and agrees that it will take all such action as may be necessary to
ensure that all shares of Common Stock delivered upon the exercise of any Warrant and the payment
of the Exercise Price pursuant to Section 2.1 (in each case, at the time of delivery of the
certificates representing such shares of Common Stock) shall (a) be duly and validly authorized and
issued and fully paid and nonassessable, free of any preemptive rights in favor of any Person in
respect of such issuance and free of any security interest, pledge, mortgage, lien, charge or other
encumbrance created by, or arising out of actions of, the Company (other than such rights and
security interests, pledges, mortgages, liens, charges, or other encumbrances, if any, arising out
of the provisions of this Agreement or the Stockholders’ Agreement) and (b) be issued without
violation of any applicable Law.



     3.3. Taxes.



     The Company covenants and agrees that it will pay when due and payable any and all Taxes and
charges that may be payable in respect of the initial issuance or delivery of:




     (a) each Warrant Certificate;




     (b) each Warrant Certificate issued in exchange for any other Warrant Certificate
pursuant to Section 1.3, Section 2.3 or Section 4; and




     (c) each share of Common Stock issued upon the exercise of any Warrant.



     The Company shall not, however, be required to:




     (i) pay any Tax that may be payable in respect of the transfer or delivery of
Warrant Certificates in a name other than that of the registered holder of the
Warrant Certificate surrendered for exercise, conversion, transfer or exchange (any
such Tax being payable by the holder of such certificate at the time of surrender);
or




     (ii) issue or deliver any such certificates referred to in the foregoing clause
(i) until any such Tax referred to in the foregoing clause (i) shall have been paid.



     3.4. Common Stock Record Date.



     Each Person in whose name any certificate for shares of Common Stock is issued upon the
exercise of Warrants shall for all purposes be deemed to have become the holder of record of the
Common Stock represented thereby on, and such certificates (if any) shall be dated, the date upon
which the Warrant Certificate evidencing such Warrants was duly surrendered with an election to
purchase attached thereto duly executed and payment of the aggregate Exercise Price (and any
applicable Taxes, if payable by such Person) was made.



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     3.5. Rights in Respect of Common Stock.



     Except as otherwise set forth herein or in the Stockholders’ Agreement, prior to the exercise
of the Warrants evidenced thereby, the holder of a Warrant Certificate shall not be entitled to any
rights of a stockholder of the Company with respect to the Common Stock into which the Warrants
shall be exercisable, including, without limitation, the right to vote in respect of any matter
upon which the holders of Common Stock may vote, the right to receive any distributions of cash or
property and, except as expressly set forth herein, in the Merger Agreement, in the Stockholders’
Agreement or in this Agreement, the right to receive any notice of any proceedings of the Company.
Prior to the exercise of the Warrants evidenced thereby, the holders of the Warrant Certificates
shall not have as such any obligation in respect of any assessment or any other obligation or
liability as a stockholder of the Company, whether such obligations or liabilities are asserted by
the Company or by creditors of the Company, but shall have the obligations set forth in the
Stockholders’ Agreement.



     3.6. Noncircumvention.



     The Company hereby covenants and agrees that the Company will not, by amendment of its
charter, bylaws or through any reorganization, transfer of assets, consolidation, merger, scheme 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 Agreement, and will at
all times in good faith carry out all the provisions of this Warrant Agreement.



4. ANTI-DILUTION ADJUSTMENTS.




     4.1. Adjustments.



     The number of shares of Common Stock purchasable upon the exercise of each Warrant, and the
Exercise Price, shall be subject to adjustment as set forth in this Section 4.



     4.2. Stock Splits, Subdivisions, Reclassifications or Combinations.



     If the Company shall (i) declare and pay a dividend or make a distribution on its Common Stock
in shares of Common Stock, (ii) subdivide or reclassify the outstanding shares of Common Stock into
a greater number of shares, or (iii) combine or reclassify the outstanding shares of Common Stock
into a smaller number of shares, the number of shares of Common Stock issuable upon exercise of any
Warrants at the time of the record date for such dividend or effective date of such split, reverse
split, subdivision, combination or reclassification shall be proportionately adjusted so that the
holder of such Warrants after such date shall be entitled to purchase the number of shares of
Common Stock which such holder would have owned or been entitled to receive in respect of the
shares of Common Stock subject to such Warrants after such date had such Warrants been exercised
immediately prior to such date. In such event, the Exercise Price in effect at the time of the
effective date of such split, reverse split, subdivision, combination or reclassification shall be
adjusted to the number obtained by dividing (x) the product of (1) the number of shares of Common
Stock issuable upon the exercise of such Warrants before such adjustment and (2) the Exercise Price
in effect immediately prior to the



8









 




record or effective date, as the case may be, for the dividend,
distribution, split, reverse split, subdivision, combination or reclassification giving rise to
this adjustment by (y) the new number of shares of Common Stock issuable upon exercise of such
Warrants determined pursuant to the immediately preceding sentence; provided that the Exercise
Price shall not be adjusted to be less than the par value of the Common Stock.




     4.3. Price Based Anti-Dilution




     (a) Without duplication of the adjustments set forth in Sections 4.2 or
4.4, (a) if the Company shall issue or sell any shares of Common Stock (as actually
issued or, pursuant to Section 4.3(b), deemed to be issued) for a consideration per
share less than 90% of the Market Price per share immediately prior to such issuance or
sale, or if earlier, upon the execution of the definitive documentation with respect to such
issuance or sale (the “Effective Time”), then immediately upon the Effective Time
the number of shares of Common Stock issuable upon exercise of any Warrants at the time of
the effective date shall be increased by multiplying such number of shares of Common Stock
by a fraction, (i) the numerator of which shall be the Fully Diluted Number of shares of
Common Stock outstanding immediately prior to the Effective Time plus the number of shares
of Common Stock so issued or sold, and (ii) the denominator of which shall be the Fully
Diluted Number of shares of Common Stock outstanding immediately prior to the Effective Time
plus the number of shares of Common Stock which the aggregate consideration received by the
Company for the total number of shares of Common Stock so issued or sold would purchase if
such shares were sold at Market Price. For the purposes of this Section 4.3(a), none
of the following issuances shall be considered the issuance or sale of Common Stock:




     (i) the issuance of Common Stock upon the conversion of any then-outstanding
Common Stock Equivalents;




     (ii) the issuance of any Common Stock or Common Stock Equivalents for which the
adjustment provided in Section 4.2 applies;




     (iii) the issuance of shares of Common Stock or Common Stock Equivalents to
Employees of the Company or any Company Subsidiary that is approved by the Board of
Directors; or




     (iv) the issuance of Common Stock pursuant to the terms of the Amended and
Restated Rights Agreement, dated as of December 3, 2002, between the Company and
American Stock Transfer and Trust Company LLC, as amended December 13, 2006, March
4, 2009 and January 24, 2010.




     (b) For the purposes of Section 4.3(a), the following subparagraphs (i) to
(iii), inclusive, shall also be applicable:




     (i) If the Company shall grant any rights to subscribe for, or any rights or
options to purchase, Common Stock Equivalents, whether or not such rights or options
or the right to convert or exchange any such Common Stock Equivalents



9









 







are
immediately exercisable, and the price per share for which Common Stock is issuable
upon the exercise of such rights or options or upon conversion or exchange of such
Common Stock Equivalents (determined by dividing (A) the total amount, if any,
received or receivable by the Company as consideration for
the granting of such rights or options, plus the minimum aggregate amount of
additional consideration payable to the Company upon the exercise of such rights or
options, plus, in the case of any such rights or options which relate to such Common
Stock Equivalents, the minimum aggregate amount of additional consideration, if any,
payable upon the issue or sale of such Common Stock Equivalents and upon the
conversion or exchange thereof, by (B) the total maximum number of shares of Common
Stock issuable upon the exercise of such rights or options or upon the conversion or
exchange of all such Common Stock Equivalents issuable upon the exercise of such
rights or options) shall be less than the Market Price per share of Common Stock
immediately prior to the time of the granting of such rights or options, or, if
earlier, the execution of definitive documentation with respect to such grant, then
the total maximum number of shares of Common Stock issuable upon the exercise of
such rights or options or upon conversion or exchange of the total maximum amount of
such Common Stock Equivalents issuable upon the exercise of such rights or options
shall (as of the date of granting of such rights or options) be deemed to be
outstanding and to have been issued for such price per share; provided that no
further adjustment of the conversion price pursuant to this Section
4.3(b)(i) shall be made (i) upon the actual issuance or sale of such Common
Stock Equivalents upon the exercise of any rights to subscribe for, or any rights or
options to purchase, such Common Stock Equivalents or (ii) upon the actual issuance
or sale of such Common Stock upon the exercise of any such Common Stock Equivalents,
including without limitation, in each case of clauses (i) and (ii) with respect to
shares of Common Stock Equivalents or Common Stock issued or issuable as a result of
the effect of antidilution adjustments under any such security.




     (ii) If the Company shall issue or sell any Common Stock Equivalents, whether
or not the rights to exchange or convert thereunder are immediately exercisable, and
the price per share for which Common Stock is issuable upon such conversion or
exchange (determined by dividing (A) the total amount received or receivable by the
Company as consideration for the issue or sale of such Common



10









 







Stock Equivalents,
plus the minimum aggregate amount of additional consideration, if any, payable to
the Company upon the conversion or exchange thereof, by (B) the total maximum number
of shares of Common Stock issuable upon the conversion or exchange of all such
Common Stock Equivalents) shall be less than the Market Price per share of Common
Stock immediately prior to the Effective Time, then the total maximum number of
shares of Common Stock issuable upon conversion or exchange of such Common Stock
Equivalents shall (as of the date of the issue or sale of such Common Stock
Equivalents) be deemed to be outstanding and to have been issued for such price per
share, provided that no further adjustment of the conversion price pursuant to this
Section 4.3(b)(ii) shall be made upon the actual issuance or sale of such
Common Stock upon the exercise of any such Common Stock Equivalents, including
without limitation, in each case with respect to shares of Common Stock issued or
issuable as a result of the effect of antidilution adjustments under any such
security.




     (iii) In case at any time any shares of Common Stock or Common Stock
Equivalents or any rights or options to purchase any such Common Stock, or Common
Stock Equivalents shall be issued or sold for cash, the consideration received
therefor shall be deemed to be the amount received by the Company therefor. In case
any shares of Common Stock or Common Stock Equivalents or any rights or options to
purchase any such Common Stock or Common Stock Equivalents shall be issued or sold
for a consideration other than cash, the amount of the consideration other than cash
received by the Company shall be deemed to be the Fair Market Value of such
consideration.



     4.4. Other Distributions.



     In case the Company shall fix a record date for the making of a dividend or distribution to
all holders of shares of its Common Stock of securities, evidences of indebtedness, assets, cash,
rights or warrants (excluding dividends of its Common Stock and other dividends or distributions
referred to in Section 4.2), in each such case, the Exercise Price in effect prior to such
record date shall be reduced immediately thereafter to the price determined by multiplying the
Exercise Price in effect immediately prior to the reduction by the quotient of (x) the Market Price
of the Common Stock on the last trading day preceding the first date on which the Common Stock
trades on the Exchange on which the Common Stock is listed or admitted to trading without the right
to receive such distribution, minus the amount of cash and/or the Fair Market Value of the
securities, evidences of indebtedness, assets, rights or warrants to be so distributed in respect
of one share of Common Stock (such amount and/or Fair Market Value, the “Per Share Fair Market
Value”) divided by (y) such Market Price on such date specified in clause (x); such adjustment
shall be made successively whenever such a record date is fixed. In such event, the number of
shares of Common Stock issuable upon the exercise of any Warrants shall be increased to the number
obtained by dividing (x) the product of (1) the number of shares of Common Stock issuable upon the
exercise of such Warrants before such adjustment, and (2) the Exercise Price in effect immediately
prior to the distribution giving rise to this adjustment by (y) the new Exercise Price determined
in accordance with the immediately preceding sentence. In the event that such distribution is not
so made, the Exercise Price and the number of shares of Common Stock issuable upon exercise of such
Warrants then in effect shall be readjusted, effective as of the date when the Board of Directors
determines not to distribute such shares, evidences of indebtedness, assets, rights, cash or
warrants, as the case may be, to the Exercise Price that would then be in effect and the number of
shares of Common Stock that would then be issuable upon exercise of such Warrants if such record
date had not been fixed.



     4.5. Business Combinations.



     In case of any Business Combination or reclassification of Common Stock (other than a
reclassification of Common Stock referred to in Section 4.2), a holder’s right to receive
shares of



11









 







Common Stock upon exercise of any Warrants shall be converted into the right to exercise
such Warrant to acquire the number of shares of stock or other securities or property (including
cash) which the Common Stock issuable (at the time of such Business Combination or
reclassification) upon exercise of such Warrants immediately prior to such Business Combination or
reclassification would have been entitled to receive upon consummation of such Business Combination
or reclassification; and in any such case, if necessary, the provisions set forth herein with
respect to the rights and interests thereafter of such holder shall be appropriately adjusted so as
to be applicable, as nearly as may reasonably be, to such holder’s right to exercise such Warrants
in exchange for any shares of stock or other securities or property pursuant to this Section
4.5. In determining the kind and amount of stock, securities or the property receivable upon
exercise of any Warrants following the consummation of such Business Combination, if the holders of
Common Stock have the right to elect the kind or amount of consideration receivable upon
consummation of such Business Combination, then the holder of such Warrants shall be entitled to
elect the kind or amount of consideration receivable upon consummation of such Business
Combination. The Company shall not enter into or be party to any Business Combination unless the
successor of the Company (if any), assumes in writing all of the obligations of the Company under
this Warrant Agreement pursuant to written agreements, including agreements to deliver to each
holder of Warrants hereunder in exchange for such Warrants a security of such successor evidenced
by a written instrument substantially similar in form and substance to this Warrant Agreement.




	4.6.	 	Expiration of Rights or Options.





     Upon the expiration of any rights or options to subscribe for, purchase or convert or exchange
Common Stock or Common Stock Equivalents in respect of the issuance, sale or grant of which
adjustment was made pursuant to Section 4.3, without the exercise thereof, the Exercise
Price and the number of shares of Common Stock purchasable upon the exercise of each Warrant
shall, upon such expiration, be readjusted and shall thereafter be such Exercise Price and such
number of shares of Common Stock as would have been had such Exercise Price and such number of
shares of Common Stock not been originally adjusted (or had the original adjustment not been
required, as the case may be), as if:




     (a) the only shares of Common Stock so issued were the shares of Common Stock, if any,
actually issued or sold upon the exercise of such rights or options; and




     (b) such shares of Common Stock, if any, were issued or sold for the consideration
actually received by the Company upon such exercise plus the aggregate consideration, if
any, actually received by the Company for the issuance, sale or grant of all of such rights
or options, whether or not exercised; provided that no such readjustment shall have the
effect of increasing the Exercise Price by an amount in excess of the amount of the
reduction initially made in respect of the issuance, sale, or grant of such rights or
options.




12











 





     4.7. Rounding of Calculations; Minimum Adjustments.



     All calculations under this Section 4 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 4 to the contrary notwithstanding, no adjustment in the Exercise Price or
the number of shares of Common Stock into which any Warrants are exercisable 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.



     4.8. Timing of Issuance of Additional Common Stock Upon Certain Adjustments.



     In any case in which the provisions of this Section 4 shall require that an adjustment
shall become effective immediately after a record date for an event, the Company may defer until
the occurrence of such event (i) issuing to the holder of any Warrants exercised after such record
date and before the occurrence of such event the additional shares of Common Stock issuable upon
such exercise by reason of the adjustment required by such event over and above the shares of
Common Stock issuable upon such exercise before giving effect to such adjustment and (ii) paying to
such holder any amount of cash in lieu of a fractional share of Common Stock; provided, however,
that the Company upon request shall deliver to such holder a due bill or other appropriate
instrument evidencing such holder’s right to receive such additional shares, and such cash, upon
the occurrence of the event requiring such adjustment.



     4.9. Miscellaneous.




     (a) Statement Regarding Adjustments. Whenever the Exercise Price or the number of
shares of Common Stock into which any Warrants are exercisable shall be adjusted as provided
in Section 4, the Company shall forthwith file at the principal office of the
Company referenced in Section 6.6 a statement showing in reasonable detail the facts
requiring such adjustment and the Exercise Price that shall be in effect and the number of
shares of Common Stock into which such Warrants shall be exercisable after such adjustment,
and the Company shall also cause a copy of such statement to be sent by mail, first class
postage prepaid, to each holder of Warrants at the address appearing in the Company’s
records.




     (b) Notice of Adjustment Event. In the event that the Company shall propose to take any
action of the type described in this Section 4 (but only if the action of the type
described in this Section 4 would result in an adjustment in the Exercise Price or
the number of shares of Common Stock into which Warrants are exercisable or a change in the
type of securities or property to be delivered upon exercise of Warrants), the Company shall
give notice to the holders of Warrants, in the manner set forth in Section 4.9(a),
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



13









 







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 any Warrants. 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 taking of such proposed action. Without limiting the foregoing,
to the extent notice of any of the foregoing actions or events is given to the holders of
the Common Stock, such notice shall be provided to the holders of the Warrants on or before
such notice to the holders of Common Stock.




     (c) 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
4, the Company shall take any action which may be necessary, including obtaining
regulatory, New York Stock Exchange, NASDAQ Stock Market or other applicable national
securities exchange (an “Exchange”) or stockholder approvals or exemptions, in order
that the Company may thereafter validly and legally issue as fully paid and nonassessable
all shares of Common Stock that the holders are entitled to receive upon exercise of this
any Warrants pursuant to this Section 4.




     (d) Adjustment Rules. Any adjustments pursuant to this Section 4 shall be made
successively whenever an event referred to herein shall occur. If more than one subsection
of this Section 4 is applicable to a single event, the subsection shall be applied
that produces the largest adjustment and no single event shall cause an adjustment under
more than one subsection of this Section 4 so as to result in duplication. If an
adjustment in Exercise Price made hereunder would reduce the Exercise Price to an amount
below par value of the Common Stock, then such adjustment in Exercise Price made hereunder
shall reduce the Exercise Price to the par value of the Common Stock.



5. INTERPRETATION OF THIS AGREEMENT.




     5.1. Certain Defined Terms.



     For the purpose of this Agreement, the following terms shall have the meanings set forth below
or set forth in the Section hereof following such term:



     “Affiliate” means, with respect to any Person, (a) a director, officer or shareholder
of such Person, (b) a spouse, parent, sibling or descendant of such Person (or spouse, parent,
sibling or descendant of any director or executive officer of such Person) and (c) any other Person
that, directly or indirectly through one or more intermediaries, Controls, or is Controlled by, or
is under common Control with, such Person, at such time; provided, however, that none of the
Purchasers shall be deemed to be an “Affiliate” of the Company and no Person holding any one or
more of the Warrants shall be deemed to be an “Affiliate” of the Company solely by virtue of the
ownership thereof.



     “Agreement” means this Warrant Agreement as it may from time to time be amended,
restated, modified or supplemented.



14









 





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



     “Business Combination” means any consolidation of the Company with, or merger of the
Company with or into, another Person (other than a merger in which (a) the Company is the surviving
corporation, (b) that does not result in any reclassification or change of shares of Common Stock
outstanding immediately prior to such merger and (c) the holders of Common Stock are not entitled
to receive any consideration therefrom), or any sale or conveyance to another Person of the assets
of the Company substantially as an entirety.



     “business day” means any day that is not a Saturday, Sunday or other day on which
banking institutions in New York, New York are authorized or required by Law or executive order to
close.



     “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 of such Person.



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



     “Closing” has the meaning set forth in the Merger Agreement.



     “Closing Date” has the meaning set forth in the Merger Agreement.



     “Common Stock” means the Company’s common stock, par value $.0001 per share.



     “Common Stock Equivalents” means outstanding Warrants or other securities convertible
or exchangeable into Common Stock.



     “Company” has the meaning set forth in the introductory paragraph hereof.



     “Control” means, with respect to any Person, the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting Securities, by contract or otherwise.



     “Denomination” means, in the case of any Warrant Certificate, the number of shares of
Common Stock issuable upon exercise of such Warrant Certificate represented thereby.



     “Effective Time” has the set forth in Section 4.3.



     “Exchange” has the set forth in Section 4.9(c).



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



15









 





     “Exercise Price” means, prior to any adjustment pursuant to Section 4 of this
Agreement, the Initial Exercise Price; and thereafter, the Initial Exercise Price as successively
adjusted and readjusted from time to time in accordance with the provisions of Section 4.



     “Expiration Time” means 5:00 p.m., Eastern time, on March 25, 2015.



     “Fair Market Value” means, with respect to any security or other property, the fair
market value of such security or other property as determined by the Board of Directors, acting in
good faith. The Required Warrantholders may object in writing to the Board of Director’s
calculation of Fair Market Value within 10 days of receipt of written notice thereof. If the
Required Warrantholders and the Board of Directors are unable to agree on Fair Market Value during
the 10-day period following the delivery of the Required Warrantholders’ objection, then the Board
of Directors shall select and approve an appraiser experienced in the business of evaluating or
appraising the market value of securities (which appraiser shall be subject to approval by the
Required Warrantholders, which approval shall not be unreasonably withheld). The Fair Market Value
established by such appraiser shall be conclusive and binding on the parties. In the event the Fair
Market Value established by such appraiser is greater than the Fair Market Value previously
determined by the Board of Directors, the fees and expenses for such appraiser shall be borne by
the Company. In the event the Fair Market Value established by such appraiser is less than or
equal to the Fair Market Value previously determined by the Board of Directors, the fees and
expenses for such appraiser shall be borne by the holders of Warrants.



     “Fully Diluted Number of Common Shares” means the sum of (i) all shares of Common
Stock actually outstanding (which shall in no event include the Common Stock to be so issued and
sold and for which Section 4.3 is being applied) and (ii) all shares of Common Stock
issuable upon conversion or exchange of the Common Stock Equivalents.



     “Initial Exercise Price” means $10.00 per share of Common Stock.



     “Issue Date” means March 25, 2010.



     “Law” has the set forth in Section 1.1.



     “Market Price” means, with respect to a particular security, on any given day, the
last reported sale price or, in case no such reported sale takes place on such day, the average of
the last closing bid and ask prices in either case on the Exchange on which the applicable
securities are listed or admitted to trading. “Market Price” shall be determined without reference
to after hours or extended hours trading. If such security is not listed and traded in a manner
that the quotations referred to above are available for the period required hereunder, the Market
Price per share of Common Stock shall be deemed to be the fair market value per share of such
security as determined in good faith by the Board of Directors in reliance on an opinion of a
nationally recognized independent investment banking corporation retained by the Company for this
purpose (which opinion shall be made available to the holders of Warrants); provided that the
Required Warrantholders may object in writing to the Board of Director’s calculation of fair market
value within 10 days of receipt of written notice thereof. If the Required Warrantholders and the
Board of Directors are unable to agree on fair market value during the 10-day period



16









 




following the delivery of the Required Warrantholders’ objection, then the Board of Directors
shall select and approve an appraiser experienced in the business of evaluating or appraising
the market value of securities (which appraiser shall be subject to approval by the Required
Warrantholders, which approval shall not be unreasonably withheld). The Market Price established
by such appraiser shall be conclusive and binding on the parties. In the event the Market Price
established by such appraiser is greater than the Market Price previously determined by the Board
of Directors, the fees and expenses for such appraiser shall be borne by the Company. In the event
the Market Price established by such appraiser is less than or equal to the Market Price previously
determined by the Board of Directors, the fees and expenses for such appraiser shall be borne by
the holders of Warrants. For the purposes of determining the Market Price of the Common Stock on
the “trading day” preceding, on or following the occurrence of an event, (i) that trading day shall
be deemed to commence immediately after the regular scheduled closing time of trading on the Nasdaq
Stock Market or, if trading is closed at an earlier time, such earlier time and (ii) that trading
day shall end at the next regular scheduled closing time, or if trading is closed at an earlier
time, such earlier time (for the avoidance of doubt, and as an example, if the Market Price is to
be determined as of the last trading day preceding a specified event and the closing time of
trading on a particular day is 4:00 p.m. and the specified event occurs at 5:00 p.m. on that day,
the Market Price would be determined by reference to such 4:00 p.m. closing price).




     “Merger Agreement” means the Agreement and Plan of Merger, dated as January 24, 2010,
by and among the Company, Camelot Acquisition Corp., a Delaware corporation, a Delaware
corporation, Critical Homecare Solutions Holdings, Inc., a Delaware corporation, and the Purchasers
(other than Colleen Lederer).



     “Per Share Fair Market Value” has the meaning set forth in Section 4.4.



     “Person” has the meaning given to it in Section 3(a)(9) of the Exchange Act and as
used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.



     “Purchasers” has the meaning set forth in the introductory paragraph hereof.



     “Required Warrantholders” means, at any time, the holders of Warrants representing at
least a majority of the Common Stock issuable upon exercise of the Warrants issued hereunder and
outstanding (exclusive of any Warrants directly or indirectly held by the Company or any Affiliate
of the Company).



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



     “Stockholders’ Agreement” means the Stockholders’ Agreement of even date herewith
among the Company and the Purchasers, as such agreement may be amended from time to time pursuant
to its terms.



     “Tax” has the set forth in Section 1.5(a).



17









 





     “trading day” means (A) if the shares of Common Stock are not traded on any national
or regional securities exchange or association or over-the-counter market, a business day or (B) if
the shares of Common Stock are traded on any national or regional securities exchange or
association or over-the-counter market, a business day on which such relevant exchange or
quotation system is scheduled to be open for business and on which the shares of Common Stock (i)
are not suspended from trading on any national or regional securities exchange or association or
over-the-counter market for any period or periods aggregating one half hour or longer; and (ii)
have traded at least once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the shares of Common Stock.



     “Transferee” means any registered transferee of all or any part of any one or more
Warrant Certificates initially acquired by the Purchasers under this Agreement; provided, that such
transfer is in accordance with the Stockholders’ Agreement, if applicable.



     “U.S. GAAP” means United States generally accepted accounting principles.



     “Warrant” means a warrant to initially purchase one share of Common Stock issued
pursuant to this Agreement and the Merger Agreement.



     “Warrant Certificate” means a certificate evidencing the Warrants in the form of
Attachment A.



     5.2. Section Heading and Table of Contents and Construction.




     (a) Section Headings and Table of Contents, etc. The titles of the Sections of this
Agreement and the Table of Contents of this Agreement appear as a matter of convenience
only, do not constitute a part hereof and shall not affect the construction hereof. The
words “herein,” “hereof,” “hereunder” and “hereto” refer to this Agreement as a whole and
not to any particular Section or other subdivision. References to Sections are, unless
otherwise specified, references to Sections of this Agreement. References to Annexes and
Attachments are, unless otherwise specified, references to Annexes and Attachments attached
to this Agreement.




     (b) Independent Construction. Each covenant contained herein shall be construed
(absent an express contrary provision herein) as being independent of each other covenant
contained herein, and compliance with any one covenant shall not (absent such an express
contrary provision) be deemed to excuse compliance with one or more other covenants.



     5.3. Directly or Indirectly.



     Where any provision herein refers to action to be taken by any Person, or which such Person is
prohibited from taking, such provision shall be applicable whether such action is taken directly or
indirectly by such Person, including actions taken by or on behalf of any partnership in which such
Person is a general partner.



18









 





     5.4. Governing Law.



     THIS AGREEMENT AND THE WARRANT CERTIFICATES SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAWS RULES THEREOF TO THE EXTENT THAT ANY SUCH RULES WOULD REQUIRE OR
PERMIT THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, EXCEPT TO THE EXTENT THAT THE
DELAWARE GENERAL CORPORATION LAW SPECIFICALLY AND MANDATORILY APPLIES.



6. MISCELLANEOUS.




     6.1. Expenses.



     Issuance of certificates for shares of Common Stock to a holder upon the exercise of any
Warrants shall be made without charge to such holder for any Tax or other incidental expense in
respect of the issuance of such certificates, all of which Taxes and expenses shall be paid by the
Company (other than the Taxes not payable by the Company pursuant to Section 3.3).



     6.2. Amendment and Waiver.



     This Agreement may be amended, and the observance of any term of this Agreement may be waived,
with and only with the written consent of the Company and the Required Warrantholders; provided,
however, that no amendment or waiver of the provisions of this Section 2.1, Section
6.2, Section 4 or of any term defined in Section 5.1 to the extent used herein
or therein, may be made without the prior written consent of all holders of Warrants then
outstanding (excluding any Warrants directly or indirectly held by the Company or any Affiliate of
the Company); and, provided, further, that




     (a) no such amendment or waiver of any of the provisions of this Agreement pertaining
to the Exercise Price or the number of shares or kind of Common Stock that may be purchased
upon exercise of each Warrant; and




     (b) no change accelerating the occurrence of the Expiration Time;
shall be effective as to a holder of Warrants unless consented to in writing by such holder.



     6.3. Warrants Subject to Stockholders’ Agreement.



     The holders of the Warrants and the Company are subject in all respects to the terms of the
Stockholders’ Agreement, the terms and provisions of which are incorporated herein, mutatis
mutandis, as if set forth fully herein. By its acceptance of a Warrant Certificate, each holder of
Warrants agrees to be bound by the provisions of the Stockholders’ Agreement to the extent
applicable.



19









 





     6.4. Entire Agreement.



     This Agreement, the Merger Agreement, the Stockholders’ Agreement and the Warrant Certificates
embody the entire agreement and understanding among the Company and the
Purchasers, and supersede all prior agreements and understandings, relating to the subject
matter hereof.



     6.5. Successors and Assigns.



     All covenants and other agreements in this Agreement made by or on behalf of any of the
parties hereto shall bind and inure to the benefit of the respective successors and assigns of the
parties hereto to the extent they become holders of Warrants (including, without limitation, any
Transferee) whether so expressed or not. Notwithstanding the foregoing sentence, the Company may
not assign any of its rights, duties or obligations hereunder or under the Warrant Certificates
without the prior written consent of the Required Warrantholders.



     6.6. Notices.



     All communications hereunder or under the Warrants shall be in writing and shall be delivered
either by certified or registered mail, postage pre-paid, return receipt requested, or nationally
recognized overnight courier, and shall be addressed to the following addresses:




     (a) if to a Purchaser, at its address set forth on Annex 2 to this Agreement,
or at such other address as such Purchaser shall have specified to the Company in writing;




     (b) if to any other holder of any Warrant Certificate, addressed to such other holder
at such address as such other holder shall have specified to the Company in writing or, if
any such other holder shall not have so specified an address to the Company, then addressed
to such other holder in care of the last holder of such Warrant Certificate that shall have
so specified an address to the Company; and




     (c) if to the Company, at the address set forth on Annex 3 to this Agreement,
or at such other address as the Company shall have specified to each holder of Warrants in
writing.


Any communication addressed and delivered as herein provided shall be deemed to be received when
actually delivered to the address of the addressee (whether or not delivery is accepted) by a
nationally recognized overnight delivery service which provides proof of delivery or on the date
postmarked if sent by registered or certified mail, as the case may be. Any communication not so
addressed and delivered shall be ineffective unless actually received by the intended addressee.
Notwithstanding the foregoing provisions of this Section 6.6, service of process in any
suit, action or proceeding arising out of or relating to this Agreement or any document, agreement
or transaction contemplated hereby shall be delivered in the manner provided in Section
6.9(c).




20









 








     6.7. Severability.



     Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.



     6.8. Execution in Counterpart.



     This Agreement may be executed in one or more counterparts and shall be effective when at
least one counterpart shall have been executed by each party hereto, and each set of counterparts
that, collectively, show execution by each party hereto shall constitute one duplicate original.



     6.9. Waiver of Jury Trial; Consent to Jurisdiction, Etc.




     (a) Waiver of Jury Trial. THE PARTIES HERETO VOLUNTARILY AND INTENTIONALLY WAIVE ANY
RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS AGREEMENT OR THE WARRANTS OR ANY OF THE DOCUMENTS,
AGREEMENTS OR TRANSACTIONS CONTEMPLATED HEREBY.




     (b) Consent to Jurisdiction. ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR THE WARRANTS, OR ANY OF THE DOCUMENTS, AGREEMENTS OR TRANSACTIONS
CONTEMPLATED HEREBY (WHETHER IN TORT, CONTRACT OR OTHERWISE) OR ANY ACTION OR PROCEEDING TO
EXECUTE OR OTHERWISE ENFORCE ANY JUDGMENT IN RESPECT OF ANY BREACH UNDER THIS AGREEMENT, THE
WARRANTS OR ANY DOCUMENT OR AGREEMENT CONTEMPLATED HEREBY SHALL BE BROUGHT BY SUCH PARTY IN
ANY NEW YORK STATE COURT OR FEDERAL DISTRICT COURT LOCATED IN THE SOUTHERN DISTRICT OF NEW
YORK AS SUCH PARTY MAY IN ITS SOLE DISCRETION ELECT, AND BY THE EXECUTION AND DELIVERY OF
THIS AGREEMENT, THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMIT TO THE IN PERSONAM
JURISDICTION OF EACH SUCH COURT, AND EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES AND
AGREES NOT TO ASSERT IN ANY PROCEEDING BEFORE ANY TRIBUNAL, BY WAY OF MOTION, AS A DEFENSE
OR OTHERWISE, ANY CLAIM THAT IT IS NOT SUBJECT TO THE IN PERSONAM JURISDICTION OF ANY SUCH
COURT. IN ADDITION, EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY DOCUMENT,
AGREEMENT OR TRANSACTION CONTEMPLATED HEREBY BROUGHT IN ANY SUCH COURT, AND HEREBY
IRREVOCABLY WAIVES ANY



21









 







CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.




     (c) Service of Process. EACH PARTY HERETO IRREVOCABLY AGREES THAT PROCESS PERSONALLY
SERVED OR SERVED BY U.S. REGISTERED MAIL AT THE ADDRESSES PROVIDED HEREIN FOR NOTICES SHALL CONSTITUTE, TO THE
EXTENT PERMITTED BY LAW, ADEQUATE SERVICE OF PROCESS IN ANY SUIT, ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE WARRANTS OR ANY DOCUMENT, AGREEMENT OR
TRANSACTION CONTEMPLATED HEREBY, OR ANY ACTION OR PROCEEDING TO EXECUTE OR OTHERWISE ENFORCE
ANY JUDGMENT IN RESPECT OF ANY BREACH HEREUNDER, UNDER THE WARRANTS OR UNDER ANY DOCUMENT OR
AGREEMENT CONTEMPLATED HEREBY. RECEIPT OF PROCESS SO SERVED SHALL BE CONCLUSIVELY PRESUMED
AS EVIDENCED BY A DELIVERY RECEIPT FURNISHED BY THE UNITED STATES POSTAL SERVICE OR ANY
COMMERCIAL DELIVERY SERVICE.



[Remainder of page intentionally left blank; next page is signature page]




22









 





     IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be duly executed
and delivered on its behalf by one of its duly authorized officers or representatives.



	 	 	 	 	 
	 	BIOSCRIP, INC.

 	 
	 	By:  	/s/ Barry A. Posner
 	 
	 	 	Name:  	Barry A. Posner 	 
	 	 	Title:  	Executive Vice President, Secretary and
General Counsel 	 
	 
	 	KOHLBERG INVESTORS V, L.P.



By: Kohlberg Management V, L.L.C., its general partner


 	 
	 	By:  	/s/ Gordon H. Woodward
 	 
	 	 	Name:  	Gordon H. Woodward 	 
	 	 	Title:  	Authorized Representative 	 
	 
	 	KOHLBERG TE INVESTORS V, L.P.



By: Kohlberg Management V, L.L.C., its general partner


 	 
	 	By:  	/s/ Gordon H. Woodward
 	 
	 	 	Name:  	Gordon H. Woodward 	 
	 	 	Title:  	Authorized Representative 	 
	 
	 	KOHLBERG OFFSHORE INVESTORS V, L.P.



By: Kohlberg Management V, L.L.C., its general partner


 	 
	 	By:  	/s/ Gordon H. Woodward
 	 
	 	 	Name:  	Gordon H. Woodward 	 
	 	 	Title:  	Authorized Representative 	 
	 



[Signature Page to Warrant Agreement]





 









 





	 	 	 	 	 
	 	KOHLBERG PARTNERS V, L.P.



By: Kohlberg Management V, L.L.C., its general partner


 	 
	 	By:  	/s/ Gordon H. Woodward
 	 
	 	 	Name:  	Gordon H. Woodward 	 
	 	 	Title:  	Authorized Representative 	 
	 
	 	KOCO INVESTORS V, L.P.



By: Kohlberg Management V, L.L.C., its general partner


 	 
	 	By:  	/s/ Gordon H. Woodward
 	 
	 	 	Name:  	Gordon H. Woodward 	 
	 	 	Title:  	Authorized Representative 	 
	 
	 	S.A.C. DOMESTIC CAPITAL FUNDING, LTD.

 	 
	 	By:  	/s/ Peter Nussbaum
 	 
	 	 	Name:  	Peter Nussbaum 	 
	 	 	Title:  	Authorized Signature 	 
	 
	 	BLACKSTONE MEZZANINE PARTNERS II, L.P.



By: Blackstone Mezzanine Associates II L.P., its General Partner




By: Blackstone Mezzanine Management Associates II L.L.C., its General Partner,


 	 
	 	By:  	/s/ Marisa J. Beeney
 	 
	 	 	Name:  	Marisa J. Beeney 	 
	 	 	Title:  	Authorized Signatory 	 
	 



[Signature Page to Warrant Agreement]





 









 





	 	 	 	 	 
	 	BLACKSTONE MEZZANINE HOLDINGS II, L.P.



By: BMP II Side-by-side GP L.L.C., its General Partner


 	 
	 	By:  	/s/ Marisa J. Beeney
 	 
	 	 	Name:  	Marisa J. Beeney 	 
	 	 	Title:  	Authorized Signatory 	 
	 
	 
	 
	 	 	/s/ Nitin Patel
 	 
	 	 	Nitin Patel 	 
	 
	 	 	/s/ Robert Cucuel
 	 
	 	 	Robert Cucuel 	 
	 
	 	 	/s/ Mary Jane Graves
 	 
	 	 	Mary Jane Graves 	 
	 
	 	 	/s/ Joey Ryan
 	 
	 	 	Joey Ryan 	 
	 
	 	 	/s/ Colleen Lederer
 	 
	 	 	Colleen Lederer 	 
	 	 	 	 



[Signature Page to Warrant Agreement]





 











 





ATTACHMENT A




[FORM OF WARRANT CERTIFICATE]



     THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE OFFERED OR SOLD
EXCEPT IN A TRANSACTION REGISTERED UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF SUCH ACT OR STATE SECURITIES LAWS.



     THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS OF A CERTAIN
WARRANT AGREEMENT, DATED AS OF MARCH 25, 2010, THE PROVISIONS OF WHICH ARE INCORPORATED HEREIN BY
REFERENCE. A COPY OF SUCH AGREEMENT IS AVAILABLE FROM THE COMPANY UPON REQUEST.



WARRANT CERTIFICATE




BIOSCRIP, INC.



			
	 	 	 
	No. WR-
	 	            
                  
           Warrants
	Date: March 25, 2010	 	 






     This Warrant Certificate certifies that
                    
                    
                    
, or registered assigns, is the
registered holder of            
                 
             (     
                    
               ) Warrants. Each Warrant entitles the owner thereof to
purchase at any time on or after the date hereof and on or prior to the Expiration Time, one (1)
fully paid and nonassessable share of Common Stock, $.001 par value per share (the “Common
Stock”), of BIOSCRIP, INC., a Delaware corporation (together with its successors and assigns,
the “Company”), at a purchase price (subject to adjustment as provided in the Warrant
Agreement (as defined below), the “Exercise Price”) of $10.00 per share of Common Stock
upon presentation and surrender of this Warrant Certificate to the Company with a duly executed
election to purchase and payment of the Exercise Price, all in the manner set forth in the Warrant
Agreement (defined below). The number of shares of Common Stock that may be initially purchased
upon exercise of each Warrant and the Exercise Price are the number and the Exercise Price as of
the date hereof, and are subject to adjustment as referred to below.



     The Warrants are issued pursuant to a Warrant Agreement (as it may from time to time be
amended or supplemented, the “Warrant Agreement”), dated as of March 25,
2010, among the Company and the Purchasers named therein, and are subject to all of the terms,
provisions and conditions thereof, which Warrant Agreement is hereby incorporated herein by
reference and made a part hereof and to which Warrant Agreement reference is hereby made for a full



 









 




description of the rights, obligations, duties and immunities of the Company and the holders of the
Warrant Certificates. Capitalized terms used, but not defined, herein have the respective meanings
ascribed to them in the Warrant Agreement. In the event of any conflict between this Warrant
Certificate and the Warrant Agreement, the Warrant Agreement shall control and govern.




     As provided in the Warrant Agreement, the Exercise Price and the number of shares of Common
Stock that may be purchased upon the exercise of the Warrants evidenced by this Warrant Certificate
are, upon the happening of certain events, subject to modification and adjustment. Except as
otherwise set forth in, and subject to, the Warrant Agreement, the Expiration Time of this Warrant
Certificate is as set forth in the Warrant Agreement.



     This Warrant Certificate shall be exercisable, at the election of the holder, at any time on
or after the date hereof and on or prior to the Expiration Time either as an entirety or in part
from time to time. If this Warrant Certificate shall be exercised in part, the holder shall be
entitled to receive, upon surrender hereof, another Warrant Certificate or Warrant Certificates for
the number of Warrants not exercised. This Warrant Certificate, with or without other Warrant
Certificates, upon surrender in the manner set forth in the Warrant Agreement and subject to the
conditions set forth in the Warrant Agreement and the Stockholders’ Agreement, may be transferred
or exchanged for another Warrant Certificate or Warrant Certificates of like tenor evidencing
Warrants entitling the holder to purchase a like aggregate number of shares of Common Stock as the
Warrants evidenced by the Warrant Certificate or Warrant Certificates surrendered shall have
entitled such holder to purchase.



     Except as expressly set forth in the Warrant Agreement or the Stockholders’ Agreement, no
holder of this Warrant Certificate shall be entitled to vote or receive distributions or be deemed
for any purpose the holder of shares of Common Stock or of any other Securities of the Company that
may at any time be issued upon the exercise hereof, nor shall anything contained in the Warrant
Agreement or herein be construed to confer upon the holder hereof, as such, any of the rights of a
holder of a share of Common Stock in the Company or any right to vote upon any matter submitted to
holders of shares of Common Stock at any meeting thereof, or to give or withhold consent to any
corporate action of the Company (whether upon any recapitalization, issuance of stock,
reclassification of Securities, change of par value, consolidation, merger, conveyance, or
otherwise), or to receive dividends or subscription rights, or otherwise, until the Warrant or
Warrants evidenced by this Warrant Certificate shall have been exercised as provided in the Warrant
Agreement.



     THIS WARRANT CERTIFICATE SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF
THE COMPANY AND THE HOLDER HEREOF SHALL BE GOVERNED BY, THE INTERNAL LAWS OF THE STATE OF NEW YORK,
WITHOUT GIVING
EFFECT TO THE CONFLICT OF LAWS RULES THEREOF TO THE EXTENT THAT ANY SUCH RULES WOULD REQUIRE
OR PERMIT THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, EXCEPT TO THE EXTENT THAT THE
DELAWARE GENERAL CORPORATION LAW SPECIFICALLY AND MANDATORILY APPLIES.



Attachment A-2



 









 





     WITNESS the signature of a proper officer of the Company as of the date first above written.



	 	 	 	 	 
	 	BIOSCRIP, INC.

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 



Attachment A-3




 











 





[FORM OF ASSIGNMENT]

(To be executed by the registered holder if

such holder desires to transfer the Warrant Certificate)




     FOR VALUE RECEIVED,                                                              hereby sells,
assigns and
transfers unto




	 	 	 

	 
	 	 	(Please print name and address of transferee.)





     the accompanying Warrant Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint:




	 	 	 





attorney, to transfer the accompanying Warrant Certificate on the books of the Company with full
power of substitution.




     Dated:                                         ,                     .



	 	 	 	 	 
	 	[HOLDER]

 	 
	 	By:  	 	 
	 	 	 	 
	 	 	 	 
	 



NOTICE





     The signature to the foregoing Assignment must correspond to the name as written upon the face
of the accompanying Warrant Certificate or any prior assignment thereof in every particular,
without alteration or enlargement or any change whatsoever.



Attachment A-4









 





[FORM OF ELECTION TO PURCHASE]

(To be executed by the registered holder if

such holder desires to exercise the Warrant Certificate)




To: BIOSCRIP, INC.




     The undersigned hereby irrevocably elects to exercise                                          Warrants
represented by the accompanying Warrant Certificate to purchase the shares of Common Stock issuable
upon the exercise of such Warrants, and requests that certificates for such shares be issued in the
name of:




	 	 	 

	 
	 	 	(Please print name and address.)






	 	 	 

	 
	 	 	(Please insert social security or other identifying number.)





     If such number of Warrants shall not be all the Warrants evidenced by the accompanying Warrant
Certificate, a new Warrant Certificate for the balance remaining of such Warrants shall be
registered in the name of and delivered to:




	 	 	 

	 
	 	 	(Please print name and address.)






	 	 	 

	 
	 	 	(Please insert social security or other identifying number.)





     The undersigned is paying the Exercise Price for the Common Stock to be issued on exercise of
the foregoing Warrants, unless payment of such Exercise Price has been waived by the Company:




     o by certified or bank check by wire transfer pursuant to Section 2.1(a)(i) of
the Warrant Agreement; or




     o by cashless exercise pursuant to Section 2.1(a)(ii) of the Warrant Agreement.



Attachment A-5









 





Dated:                                         ,                     .




	 	 	 	 	 
	 	[HOLDER]

 	 
	 	By:  	 	 
	 	 	 	 
	 	 	 	 
	 



NOTICE





     The signature to the foregoing Election to Purchase must correspond to the name as written
upon the face of the accompanying Warrant Certificate or any prior assignment thereof in every
particular, without alteration or enlargement or any change whatsoever.








Attachment A-6









 








ANNEX 1




Warrants Issuable to the Purchasers



	 	 	 	 	 
	Purchaser	 	No. of Warrants	 
	Kohlberg Investors V, L.P.
	 	 	1,585,904	 
	Kohlberg Partners V, L.P.
	 	 	89,302	 
	Kohlberg Offshore Investors V, L.P.
	 	 	106,232	 
	Kohlberg TE Investors V, L.P.
	 	 	1,153,407	 
	KOCO Investors V, L.P.
	 	 	70,042	 
	Blackstone Mezzanine Partners II, L.P.
	 	 	72,119	 
	Blackstone Mezzanine Holdings II, L.P.
	 	 	3,003	 
	S.A.C. Domestic Capital Funding, Ltd.
	 	 	18,781	 
	Robert Cucuel
	 	 	172,648	 
	Mary Jane Graves
	 	 	66,446	 
	Nitin Patel
	 	 	24,698	 
	Joey Ryan
	 	 	23,178	 
	Colleen Lederer
	 	 	15,185	 
	 
	 	 	 
	Total
	 	 	3,400,945	 
	 
	 	 	 






Annex 1-1









 






ANNEX 2




Address for Purchasers for Notices



[Purchaser]

c/o Kohlberg Investors V, L.P.

c/o Kohlberg & Company

111 Radio Circle

Mount Kisco, New York 10549

Attention: Gordon Woodward




In each case with a copy to:




Paul, Weiss, Rifkind, Wharton & Garrison LLP

1285 Avenue of the Americas

New York, New York 10019 6064

Attention: Angelo Bonvino, Esq.









Annex 2-1









 








ANNEX 3




Address of Company for Notices



BioScrip, Inc.

100 Clearbrook Road

Elmsford, New York 10523

Attention: Chief Executive Officer



With a copy to:




King & Spalding LLP

1185 Avenue of the Americas

New York, New York 10036

Attention: E. William Bates II, Esq.





Annex 3-1