Document:

Form of Stock Purchase Warrant dated June 4, 2003

Exhibit 4.4 
 
THIS WARRANT AND THE SHARES ISSUABLE UPON THE EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. EXCEPT AS OTHERWISE SET FORTH HEREIN OR IN A SECURITIES PURCHASE AGREEMENT DATED AS OF NOVEMBER     , 2002, NEITHER THIS WARRANT NOR ANY OF SUCH SHARES MAY BE SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER SAID ACT OR, AN OPINION OF COUNSEL, IN FORM, SUBSTANCE AND SCOPE, REASONABLY SATISFACTORY TO K2 INC. THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS
SOLD PURSUANT TO RULE 144 UNDER SUCH ACT. 
 

	 	  	 	  	 Right to
 Purchase
 243,260
 Shares of
 Common Stock,
 par value $1.00
 per share

 
STOCK
PURCHASE WARRANT 
 
THIS CERTIFIES THAT,
for value received, k1 Ventures Limited or its registered assigns, is entitled to purchase from K2 Inc., a Delaware corporation (the “Company”), at any time or from time to time during the period specified in Paragraph 2 hereof, Two
Hundred Forty Three Thousand Two Hundred Sixty (243,260) fully paid and nonassessable shares of the Company’s common stock, par value $1.00 per share (the “Common Stock”), at an exercise price per share equal $13.14 (the
“Exercise Price”). The term “Warrant Shares,” as used herein, refers to the shares of Common Stock purchasable hereunder. The Warrant Shares and the Exercise Price are subject to adjustment as provided in Paragraph 6 hereof. The
term Warrants means this Warrant and the other warrants issued pursuant to that certain Securities Purchase Agreement, dated November     , 2002, among the Company and the Buyers listed on the execution page thereof (the
“Securities Purchase Agreement”). 
 
This
Warrant is subject to the following terms, provisions, and conditions: 
 
1. Manner of Exercise; Issuance of Certificates; Payment for Shares. Subject to the provisions hereof, this Warrant may be exercised by the holder hereof, in whole or in part, by the surrender of this Warrant,
together with a completed exercise agreement in the form attached hereto (the “Exercise Agreement”), to the Company during normal business hours on any business day at the Company’s principal executive offices (or such other office or
agency of the Company as it may designate by notice to the holder hereof), and upon payment to the Company in cash, by certified or official bank check or by wire transfer for the account of the Company of the Exercise Price for the Warrant Shares
specified in the Exercise Agreement. The Warrant 

 
Shares so purchased shall be
deemed to be issued to the holder hereof or such holder’s designee, as the record owner of such shares, as of the close of business on the date on which this Warrant shall have been surrendered, the completed Exercise Agreement shall have been
delivered, and payment shall have been made for such shares as set forth above. Certificates for the Warrant Shares so purchased, representing the aggregate number of shares specified in the Exercise Agreement, shall be delivered to the holder
hereof within a reasonable time, not exceeding three (3) business days, after this Warrant shall have been so exercised. The certificates so delivered shall be in such denominations as may be requested by the holder hereof and shall be registered in
the name of such holder or such other name as shall be designated by such holder. If this Warrant shall have been exercised only in part, then, unless this Warrant has expired, the Company shall, at its expense, at the time of delivery of such
certificates, deliver to the holder a new Warrant representing the number of shares with respect to which this Warrant shall not then have been exercised. 
 
Notwithstanding anything in this Warrant to the contrary, in no event shall the holder of this Warrant be entitled to exercise a number of
Warrants (or portions thereof) in excess of the number of Warrants (or portions thereof) upon exercise of which the sum of (i) the number of shares of Common Stock beneficially owned by the holder of this Warrant and its affiliates (other than
shares of Common Stock which may be deemed beneficially owned through the ownership of the unexercised Warrants and the unexercised or unconverted portion of any other securities of the Company (excluding however the Restated Warrants but including
the Debentures (as defined in the Securities Purchase Agreement)) subject to a limitation on conversion or exercise analogous to the limitation contained herein) and (ii) the number of shares of Common Stock issuable upon exercise of the Warrants
and the Restated Warrants (or portions thereof) with respect to which the determination described herein is being made, would result in beneficial ownership by the holder of this Warrant and its affiliates of more than 9.9% of the outstanding shares
of Common Stock. For purposes of the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and Regulations 13D-G thereunder, except as otherwise
provided in clause (i) hereof. Notwithstanding anything in this Warrant to the contrary, the restrictions on exercise of this Warrant set forth in this paragraph shall not be amended without (i) the written consent of the holder of this Warrant and
the Company and (ii) the approval of the holders of a majority of the Common Stock present, or represented by proxy, and voting at any meeting called to vote on the amendment of such restriction. 
 
As used herein the “Restated Warrants” means those
warrants to purchase 524,329 shares of Common Stock of the Company issuable pursuant to the Amended and Restated Stock Purchase Warrant dated as of June 4, 2003 executed by the Company for the benefit of k1 Ventures Limited, as amended, restated,
supplemented or otherwise modified from time to time. 
 
In lieu of exercising this Warrant by paying the Exercise Price in the cash as set forth in the preceding sentence, prior to its expiration pursuant to Section 2, the holder may, by providing notice thereof to the Company along with
the Exercise Agreement, elect to exercise the Warrant for a number of Warrant Shares determined in accordance with the following formula (a “Cashless Exercise”): 
 
X = Y(A-B)/ A 
 

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where:

 
X = the number of Warrant Shares to be issued to
the holder. 
 
Y = the number of Warrant Shares
purchasable under this Warrant (at the date of such exercise). 
 
A = the Market Price of one share of Common Stock 
 
B = Exercise Price (as adjusted to the date of such exercise). 
 
Solely with respect to the calculation required in connection with a Cashless Exercise, “Market Price,” as of any date, (i) means the average of the last reported sale prices for the shares
of Common Stock on the New York Stock Exchange (the “NYSE”) for the ten (10) trading days immediately preceding such date as reported by Bloomberg Financial Markets or an equivalent reliable reporting service mutually acceptable to and
hereafter designated by the holder of this Warrant and the Company (“Bloomberg”), or (ii) if NYSE is not the principal trading market for the shares of Common Stock, the average of the last reported sale prices on the principal trading
market for the Common Stock during the same period as reported by Bloomberg, or (iii) if market value cannot be calculated as of such date on any of the foregoing bases, the Market Price shall be the fair market value as reasonably determined in
good faith by the Board of Directors of the Company and set forth in a resolution. 
 
2. Period of Exercise. This Warrant is exercisable at any time or from time to time on or after the date on which this Warrant is issued and delivered on the date hereof (the “Issue
Date”) and before 5:00 p.m., New York City time on February 14, 2006 (the “Exercise Period”). 
 
3. Representations and Warranties of Holder. The holder of this Warrant represents and warrants to the Company that:

 
(a) Investment Purpose. As of the date
hereof, such holder has acquired the Warrants and the shares of Common Stock issuable upon exercise of or otherwise pursuant to the Warrants (the “Warrant Shares”; and, together with the Warrants, the “Securities”) for its own
account and not with a present view towards the public sale or distribution thereof, except pursuant to sales registered or exempted from registration under the Securities Act of 1933, as amended; provided, however, that by making the
representations herein, the holder does not agree to hold the Securities for any minimum or other specific term and reserves the right to dispose of the Securities at any time in accordance with or pursuant to a registration statement or an
exemption under the Securities Act of 1933, as amended. 
 
(b) Accredited Investor Status. Such holder is an “accredited investor” as that term is defined in Rule 501(a) of Regulation D as promulgated by the Securities and Exchange Commission pursuant to the Securities Act
of 1933, as amended (an “Accredited Investor”). 
 
(c) Reliance on Exemptions. Such holder understands that the Securities are being offered and sold to it in reliance upon specific exemptions from the registration requirements of United States federal and state securities
laws and that the Company is relying 
 

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upon the truth and accuracy
of, and such holder’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of such holder set forth herein in order to determine the availability of such exemptions and the eligibility of such holder
to acquire the Securities. 
 
(d)
Information. Such holder and its advisors, if any, have been furnished with all materials relating to the business, finances and operations of the Company and materials relating to the offer and sale of the Securities which have been
requested by such holder or its advisors. The holder and its advisors, if any, have been afforded the opportunity to ask questions of the Company. Neither such inquiries nor any other due diligence investigation conducted by any holder or any of its
advisors or representatives shall modify, amend or affect such holder’s right to rely on the Company’s representations and warranties contained in Paragraph 4 below. The holder understands that its investment in the Securities involves a
significant degree of risk. 
 
(e) Governmental
Review. Such holder understands that no United States federal or state agency or any other government or governmental agency has passed upon or made any recommendation or endorsement of the Securities. 
 
(f) Transfer or Re-sale. Such holder understands that
(i) except as provided in the Registration Rights Agreement, dated as of February 14, 2003, as amended by the letter agreement dated as of June 4, 2003 (as so amended and as the same may be amended, modified or restated hereafter, the
“Registration Rights Agreement”) among the Company and the other signatories thereto, the sale or re-sale of the Securities has not been and is not being registered under the Securities Act of 1933, as amended, or any applicable state
securities laws, and the Securities may not be transferred unless (a) the Securities are sold pursuant to an effective registration statement under the Securities Act of 1933, as amended, (b) the holder shall have delivered to the Company an opinion
of counsel (which opinion shall be in form, substance and scope reasonably satisfactory to the Company) to the effect that the Securities to be sold or transferred may be sold or transferred pursuant to an exemption from such registration, (c) the
Securities are sold or transferred to an “affiliate” (as defined in Rule 144 promulgated under the Securities Act of 1933, as amended (or a successor rule) (“Rule 144”)) of the holder who agrees to sell or otherwise transfer the
Securities only in accordance with this Paragraph 3(f) and who is an Accredited Investor or (d) the Securities are sold pursuant to Rule 144; (ii) any sale of such Securities made in reliance on Rule 144 may be made only in accordance with the terms
of said Rule and further, if said Rule is not applicable, any re-sale of such Securities under circumstances in which the seller (or the person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the
Securities Act of 1933, as amended,) may require compliance with some other exemption under the Securities Act of 1933, as amended, or the rules and regulations of the SEC thereunder; and (iii) neither the Company nor any other person is under any
obligation to register such Securities under the Securities Act of 1933, as amended, or any state securities laws or to comply with the terms and conditions of any exemption thereunder (in each case, other than pursuant to the Registration Rights
Agreement). Notwithstanding the foregoing or anything else contained herein to the contrary, the Securities may be pledged as collateral in connection with a bona fide margin account or other lending arrangement. 
 

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(g)
Legends. Such holder understands that the Warrants and, until such time as the Warrant Shares have been registered under the Securities Act of 1933, as amended, as contemplated by the Registration Rights Agreement or otherwise may be sold
pursuant to Rule 144 without any restriction as to the number of securities as of a particular date that can then be immediately sold, the Warrant Shares, may bear a restrictive legend in substantially the following form (and a stop-transfer order
may be placed against transfer of the certificates for such Warrant Shares): 
 
“The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended. The securities may not be sold, transferred or assigned in the absence of an
effective registration statement for the securities under said Act, or an opinion of counsel, in form, substance and scope reasonably satisfactory to the Company, that registration is not required under said Act or unless sold pursuant to Rule 144
under said Act.” 
 
The legend set forth above shall be
removed and the Company shall issue a certificate without such legend to the holder of the Warrant Shares upon which it is stamped, if, unless otherwise required by applicable state securities laws, (a) such Warrant Shares are registered for sale
under an effective registration statement filed under the Securities Act of 1933, as amended, or otherwise may be sold pursuant to Rule 144 without any restriction as to the number of securities as of a particular date that can then be immediately
sold, or (b) such holder provides the Company with an opinion of counsel, in form, substance and scope reasonably satisfactory to the Company, to the effect that a public sale or transfer of such Warrant Shares may be made without registration under
the Securities Act of 1933, as amended, and such sale or transfer is effected or (c) such holder provides the Company with reasonable assurances that such Warrant Shares can be sold pursuant to Rule 144. The holder agrees to sell all Warrant Shares,
including those represented by a certificate(s) from which the legend has been removed, in compliance with applicable prospectus delivery requirements, if any. 
 
(h) Authorization; Enforcement. This Stock Purchase Warrant and the amendment to the Registration Rights Agreement dated as of
February 14, 2003 (the “RR Amendment”) between the Company and the other signatories thereto have been duly and validly authorized. This Stock Purchase Warrant has been, and upon the execution and delivery of the RR Amendment it will be,
duly executed and delivered on behalf of the holder, and this Stock Purchase Warrant constitutes, and upon execution and delivery by the holder of the RR Amendment, such agreement will constitute, valid and binding agreements of the holder
enforceable in accordance with their terms. 
 
(i)
Residency. The holder is a resident of the jurisdiction set forth immediately below such holder’s name on the signature pages hereto. 
 
4. Representations and Warranties of the Company. The Company represents and warrants to each holder that: 
 

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(a)
Organization and Qualification. The Company and each of its Subsidiaries (as defined below), if any, is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is incorporated, with
full power and authority (corporate and other) to own, lease, use and operate its properties and to carry on its business as and where now owned, leased, used, operated and conducted. “Subsidiary” means any corporation or other
organization that would be a “significant subsidiary” as defined in Article I, Rule 1-02 of Regulation S-X, promulgated under the Securities Act of 1933, as amended, as such Regulation is in effect on the date hereof. 
 
(b) Authorization; Enforcement. (i) The Company has all
requisite corporate power and authority to file and perform its obligations under the Debentures and to enter into and perform this Stock Purchase Warrant, the RR Amendment and the Warrants and to consummate the transactions contemplated hereby and
thereby and to issue the Securities, in accordance with the terms hereof, (ii) the execution and delivery of this Stock Purchase Warrant, the RR Amendment and the Warrants by the Company and the consummation by it of the transactions contemplated
hereby and thereby (including without limitation, the issuance of the Warrants and the issuance and reservation for issuance of the Conversion Shares issuable upon conversion of or otherwise pursuant to the Warrant Shares issuable upon exercise of
or otherwise pursuant to the Warrants) have been duly authorized by the Company’s Board of Directors and no further consent or authorization of the Company, its Board of Directors, or its stockholders is required, (iii) this Stock Purchase
Warrant has been duly executed and delivered by the Company, and (iv) this Stock Purchase Warrant constitutes, and upon execution and delivery by the Company of the RR Amendment, the Warrants, each of such agreements and instruments will constitute,
a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws
relating to or limiting creditors’ rights generally. 
 
(c) Capitalization. All outstanding shares of capital stock are, or upon issuance will be, duly authorized, validly issued, fully paid and nonassessable. No shares of capital stock of the Company are subject to preemptive
rights or any other similar rights of the stockholders of the Company. Except as disclosed in Schedule 1, as of the effective date of this Stock Purchase Warrant, there are no outstanding options, warrants, scrip, rights to subscribe for, puts,
calls, rights of first refusal, agreements, understandings, claims or other commitments or rights of any character whatsoever relating to, or securities or rights convertible into or exchangeable for any shares of capital stock of the Company or any
of its Subsidiaries, or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares of capital stock of the Company or any of its Subsidiaries. 
 
(d) Issuance of Shares. As of the date of the issuance
of this Warrant, the Warrant Shares are duly authorized and reserved for issuance, and upon exercise of or otherwise pursuant to the Warrants in accordance with the terms thereof, will be validly issued, fully paid and non-assessable, and free from
all taxes, liens, claims and encumbrances and will not be subject to preemptive rights or other similar rights of stockholders of the Company and will not impose personal liability upon the holder thereof. 
 

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(e)
Acknowledgment of Dilution. The Company understands and acknowledges the potentially dilutive effect to the Common Stock upon the issuance of the Warrant Shares upon exercise of or otherwise pursuant to this Warrant. The Company’s
directors and executive officers have studied and fully understand the nature of the Securities being sold hereunder. The Company further acknowledges that its obligation to issue the Warrant Shares upon exercise of the Warrants in accordance with
this Stock Purchase Warrant is absolute and unconditional regardless of the dilutive effect that such issuance may have on the ownership interests of other stockholders of the Company. 
 
(f) No Conflicts. The execution, delivery and performance of this Stock Purchase Warrant, the RR
Amendment and the Warrants by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance and reservation for issuance, as applicable, of the Conversion Shares and
Warrant Shares) will not (i) conflict with or result in a violation of any provision of the Certificate of Incorporation or By-laws or (ii) violate or conflict with, or result in a breach of any provision of, or constitute a default (or an event
which with notice or lapse of time or both could become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture, patent, patent license or instrument to which the Company or
any of its Subsidiaries is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws and regulations and regulations of any self-regulatory organizations to which the
Company or its securities are subject) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected (in each case, except for such conflicts, defaults,
terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a material adverse effect). Neither the Company nor any of its Subsidiaries is in violation of its certificate of
incorporation, by-laws or other organizational documents. Except as specifically contemplated by this Stock Purchase Warrant and as required under the Securities Act of 1933, as amended, and any applicable state securities laws, the Company is not
required to obtain any consent, authorization or order of, or make any filing or registration with, any court, governmental agency, regulatory agency, self regulatory organization or stock market or any third party in order for it to execute,
deliver or perform any of its obligations under this Stock Purchase Warrant, the RR Amendment or the Warrants in accordance with the terms hereof or thereof or to issue and sell the Warrants in accordance with the terms hereof and to issue the
Warrant Shares upon exercise of or otherwise pursuant to the Warrants. The Company is not in violation of the listing requirements of the New York Stock Exchange (“NYSE”) and does not reasonably anticipate that the Common Stock will be
delisted by the NYSE in the foreseeable future. The Company and its subsidiaries are unaware of any facts or circumstances which might give rise to any of the foregoing. 
 
(g) No Integrated Offering. Neither the Company, nor any of its affiliates, nor any person acting on
its or their behalf, has directly or indirectly made any offers or sales of any security or solicited any offers to buy any security under circumstances that would require registration under the Securities Act of 1933, as amended, of the issuance of
the Securities to the holders. The issuance of the Securities to the holders will not be integrated with any other issuance of the Company’s securities (past, current or future) for purposes of any stockholder approval provisions applicable to
the Company or its securities. 
 

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(h)
Anti-dilution Adjustments. There are no anti-dilution or price adjustment provisions contained in any security issued by the Company (or in any agreement providing rights to security holders) that will be triggered by the issuance of the
Warrants or the Warrant Shares. 
 
(i) SEC
Documents; Financial Statements. Since December 31, 1999, the Company has timely filed all reports, schedules, forms, statements and other documents required to be filed by it with the Securities and Exchange Commission pursuant to the reporting
requirements of the Securities Exchange Act of 1934, as amended (the “1934 Act”) (all of the foregoing filed prior to the date hereof and all exhibits included therein and financial statements and schedules thereto and documents (other
than exhibits to such documents) incorporated by reference therein, being hereinafter referred to as the “SEC Documents”). As of their respective dates, the SEC Documents complied in all material respects with the requirements of the 1934
Act and the rules and regulations of the Securities and Exchange Commission promulgated thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time they were filed with the Securities and Exchange Commission, contained any
untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. None of the
statements made in any such SEC Documents is, or has been, required to be amended or updated under applicable law (except for such statements as have been amended or updated in subsequent filings prior to the date hereof). As of their respective
dates, the financial statements of the Company included in the SEC Documents complied as to form in all material respects with applicable accounting requirements and the published rules and regulations of the Securities and Exchange Commission with
respect thereto. Such financial statements have been prepared in accordance with United States generally accepted accounting principles, consistently applied, during the periods involved (except (i) as may be otherwise indicated in such financial
statements or the notes thereto, or (ii) in the case of unaudited interim statements, to the extent they may not include footnotes or may be condensed or summary statements) and fairly present in all material respects the consolidated financial
position of the Company and its consolidated Subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit
adjustments and the absence of footnotes). Except as set forth in the financial statements of the Company included in the SEC Documents, the Company has no liabilities, contingent or otherwise, other than (i) liabilities incurred in the ordinary
course of business subsequent to December 31, 2001 and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under generally accepted accounting principles to be reflected in such financial
statements, which, individually or in the aggregate, are not material to the financial condition or operating results of the Company. 
 
(j) Absence of Certain Changes. Since December 31, 2002, to our knowledge, there has been no material adverse change and no
material adverse development in the assets, liabilities, business, properties, operations, financial condition, or results of operations of the Company and its Subsidiaries taken as a whole. 
 
(k) Disclosure. All written information relating to or
concerning the Company or any of its Subsidiaries set forth in this Stock Purchase Warrant and otherwise in connection with the transactions contemplated hereby is true and correct in all material respects 
 

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and the Company has not
omitted to state any material fact necessary in order to make the statements made herein or therein, in light of the circumstances under which they were made, not misleading. No event or circumstance has occurred or exists, nor is the Company in
possession of any information, with respect to the Company or any of its Subsidiaries or its or their business, properties, prospects, operations or financial conditions, which has not been publicly announced or disclosed but under applicable law,
rule or regulation, requires public disclosure or announcement by the Company (assuming for this purpose that the Company’s reports filed under the 1934 Act are being incorporated into an effective registration statement filed by the Company
under the Securities Act of 1933, as amended). 
 
(l) Solvency. The Company and its Subsidiaries taken as a whole (both before and after giving effect to the transactions contemplated by this Agreement) are solvent (i.e., its assets have a fair market value in excess of the
amount required to pay its probable liabilities on its existing debts as they become absolute and matured) and currently the Company has no information that would lead it to reasonably conclude that the Company would not have the ability to, nor
does it intend to take any action that would impair its ability to, pay its debts from time to time incurred in connection therewith as such debts mature. The Company did not receive a qualified opinion from its auditors with respect to its most
recent fiscal year end and does not anticipate or know of any basis upon which its auditors might issue a qualified opinion in respect of its current fiscal year. 
 
5. Certain Agreements of the Company. The Company hereby covenants and agrees as
follows: 
 
(a) Shares to be Fully
Paid. All Warrant Shares will, upon issuance in accordance with the terms of this Warrant, be validly issued, fully paid, and nonassessable and free from all taxes, liens, and charges with respect to the issue thereof. 
 
(b) Reservation of Shares. During the
Exercise Period, the Company shall at all times have authorized, and reserved for the purpose of issuance upon exercise of this Warrant, a sufficient number of shares of Common Stock to provide for the exercise of this Warrant. 
 
(c) Listing. The Company shall promptly
secure the listing of the shares of Common Stock issuable upon exercise of the Warrant upon each national securities exchange or automated quotation system, if any, upon which shares of Common Stock are then listed (subject to official notice of
issuance upon exercise of this Warrant) and shall maintain, so long as any other shares of Common Stock shall be so listed, such listing of all shares of Common Stock from time to time issuable upon the exercise of this Warrant; and the Company
shall so list on each national securities exchange or automated quotation system, as the case may be, and shall maintain such listing of, any other shares of capital stock of the Company issuable upon the exercise of this Warrant if and so long as
any shares of the same class shall be listed on such national securities exchange or automated quotation system. Without limiting the generality of the foregoing, the Company agrees to file a listing application in respect of Warrant Shares within 5
business days of the issuance of this Warrant. 
 
(d) Certain Actions Prohibited. The Company will not, by amendment of its charter or through any reorganization, transfer of assets, consolidation, merger, dissolution, 
 

9 

 
issue or sale of securities,
or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed by it hereunder, but will at all times in good faith assist in the carrying out of all the provisions of this Warrant
and in the taking of all such action as may reasonably be requested by the holder of this Warrant in order to protect the exercise privilege of the holder of this Warrant against dilution or other impairment, consistent with the tenor and purpose of
this Warrant. Without limiting the generality of the foregoing, the Company (i) will not increase the par value of any shares of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, and (ii) will take
all such actions as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common Stock upon the exercise of this Warrant. 
 
(e) Successors and Assigns. This Warrant will be
binding upon any entity succeeding to the Company by merger, consolidation, or acquisition of all or substantially all the Company’s assets. 
 
(f) Form D; Blue Sky Laws. Promptly following the issuance of this Warrant, the Company agrees to file a Form D with
respect to the Securities as required under Regulation D and to provide a copy thereof to the holder of this Warrant promptly after such filing. The Company shall take such action as the Company shall reasonably determine is necessary to qualify the
Securities under applicable securities or “blue sky” laws of the states of the United States (or to obtain an exemption from such qualification), and shall provide evidence of any such action so taken. 
 
(g) Reporting Status; Eligibility to Use Form S-3; Press
Release. The Company’s Common Stock is registered under Section 12(g) of the 1934 Act. So long as the holder of this Warrant beneficially own any of the Securities, the Company shall timely file all reports required to be filed
with the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules and regulations thereunder would permit such termination. The Company
will take all necessary action to meet the “registrant eligibility” requirements set forth in the general instructions to Form S-3. 
 
(h) Fees. In connection with the transactions contemplated hereby, the Company shall provide to the initial holder of
this Warrant a nonaccountable expense allowance in an aggregate amount not to exceed $25,000. 
 
(i) No Integration. The Company shall not make any offers or sales of any security (other than the Securities) under circumstances that would require registration of the Securities
being offered or sold hereunder under the 1933 Act or cause the offering of Securities to be integrated with any other offering of securities by the Company for the purpose of any stockholder approval provision applicable to the Company or its
securities. 
 
6. Antidilution
Provisions. During the Exercise Period, the Exercise Price and the number of Warrant Shares shall be subject to adjustment from time to time as provided in this Paragraph 6. 
 

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In the event
that any adjustment of the Exercise Price as required herein results in a fraction of a cent, such Exercise Price shall be rounded up to the nearest cent. 
 
(a) Adjustment of Exercise Price and Number of Shares upon Issuance of Common Stock. Except as otherwise provided in
Paragraphs 6(c) and 6(e) hereof, if and whenever on or after the Issue Date of this Warrant, the Company issues or sells, or in accordance with Paragraph 6(b) hereof is deemed to have issued or sold, any shares of Common Stock for no consideration
or for a consideration per share (before deduction of reasonable expenses or commissions or underwriting discounts or allowances in connection therewith) less than the then effective Exercise Price on the date of issuance (or deemed issuance) of
such Common Stock (a “Dilutive Issuance”), then immediately upon the Dilutive Issuance, the Exercise Price will be reduced to a price determined by multiplying the Exercise Price in effect immediately prior to the Dilutive Issuance by a
fraction, (i) the numerator of which is an amount equal to the sum of (x) the number of shares of Common Stock Deemed Outstanding immediately prior to the Dilutive Issuance, plus (y) the quotient of the aggregate consideration, calculated as set
forth in Paragraph 6(b) hereof, received by the Company upon such Dilutive Issuance divided by the Exercise Price in effect immediately prior to the Dilutive Issuance, and (ii) the denominator of which is the total number of shares of Common Stock
Deemed Outstanding (as defined below) immediately after the Dilutive Issuance. 
 
(b) Effect on Exercise Price of Certain Events. For purposes of determining the adjusted Exercise Price under Paragraph 6(a) hereof, the following will be applicable: 
 
(i) Issuance of Rights or
Options. If the Company in any manner issues or grants any warrants, rights or options, whether or not immediately exercisable, to subscribe for or to purchase Common Stock or other securities convertible into or exchangeable for Common
Stock (“Convertible Securities”) (such warrants, rights and options to purchase Common Stock or Convertible Securities are hereinafter referred to as “Options”) and the price per share for which Common Stock is issuable upon the
exercise of such Options is less than the Exercise Price on the date of issuance or grant of such Options, then the maximum total number of shares of Common Stock issuable upon the exercise of all such Options will, as of the date of the issuance or
grant of such Options, be deemed to be outstanding and to have been issued and sold by the Company for such price per share. For purposes of the preceding sentence, the “price per share for which Common Stock is issuable upon the exercise of
such Options” is determined by dividing (i) the total amount, if any, received or receivable by the Company as consideration for the issuance or granting of all such Options, plus the minimum aggregate amount of additional consideration, if
any, payable to the Company upon the exercise of all such Options, plus, in the case of Convertible Securities issuable upon the exercise of such Options, the minimum aggregate amount of additional consideration payable upon the conversion or
exchange thereof at the time such Convertible Securities first become convertible or exchangeable, by (ii) the maximum total number of shares of Common Stock issuable upon the exercise of all such Options (assuming full conversion of Convertible
Securities, if applicable). No further adjustment to the Exercise Price will be made upon the actual issuance of such Common Stock upon the exercise of such 
 

11 

Options or upon the conversion or exchange of Convertible Securities issuable upon
exercise of such Options. 
 
(ii)
Issuance of Convertible Securities. If the Company in any manner issues or sells any Convertible Securities, whether or not immediately convertible (other than where the same are issuable upon the exercise of Options) and the
price per share for which Common Stock is issuable upon such conversion or exchange is less than the Exercise Price on the date of issuance of such Convertible Securities, then the maximum total number of shares of Common Stock issuable upon the
conversion or exchange of all such Convertible Securities will, as of the date of the issuance of such Convertible Securities, be deemed to be outstanding and to have been issued and sold by the Company for such price per share. For the purposes of
the preceding sentence, the “price per share for which Common Stock is issuable upon such conversion or exchange” is determined by dividing (i) the total amount, if any, received or receivable by the Company as consideration for the
issuance or sale of all such Convertible Securities, plus the minimum aggregate amount of additional consideration, if any, payable to the Company upon the conversion or exchange thereof at the time such Convertible Securities first become
convertible or exchangeable, by (ii) the maximum total number of shares of Common Stock issuable upon the conversion or exchange of all such Convertible Securities. No further adjustment to the Exercise Price will be made upon the actual issuance of
such Common Stock upon conversion or exchange of such Convertible Securities. 
 
(iii) Change in Option Price or Conversion Rate. If there is a change at any time in (i) the amount of additional consideration payable to the Company upon the exercise of any
Options; (ii) the amount of additional consideration, if any, payable to the Company upon the conversion or exchange of any Convertible Securities; or (iii) the rate at which any Convertible Securities are convertible into or exchangeable for Common
Stock (other than under or by reason of provisions designed to protect against dilution), the Exercise Price in effect at the time of such change will be readjusted to the Exercise Price which would have been in effect at such time had such Options
or Convertible Securities still outstanding provided for such changed additional consideration or changed conversion rate, as the case may be, at the time initially granted, issued or sold. 
 
(iv) Treatment of Expired Options and
Unexercised Convertible Securities. If, in any case, the total number of shares of Common Stock issuable upon exercise of any Option or upon conversion or exchange of any Convertible Securities is not, in fact, issued and the rights
to exercise such Option or to convert or exchange such Convertible Securities shall have expired or terminated, the Exercise Price then in effect will be readjusted to the Exercise Price which would have been in effect at the time of such expiration
or termination had such Option or Convertible Securities, to the extent outstanding immediately prior to such expiration or termination (other than in respect of the actual number of shares of Common Stock issued upon exercise or conversion
thereof), never been issued. 
 

12 

 
(v) Calculation of Consideration Received. If any Common Stock, Options or Convertible Securities are issued, granted or sold for cash, the consideration received therefor for purposes of this Warrant will be the amount
received by the Company therefor, before deduction of reasonable commissions, underwriting discounts or allowances or other reasonable expenses paid or incurred by the Company in connection with such issuance, grant or sale. In case any Common
Stock, Options or Convertible Securities are issued or sold for a consideration part or all of which shall be other than cash, the amount of the consideration other than cash 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 Market Price thereof as of the date of receipt. In case any Common Stock, Options or Convertible Securities are
issued in connection with any acquisition, merger or consolidation in which the Company is the surviving corporation, 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 corporation as is attributable to such Common Stock, Options or Convertible Securities, as the case may be. The fair value of any consideration other than cash or securities will be determined in good faith by the Board of Directors of
the Company and set forth in a resolution. 
 
(vi) Exceptions to Adjustment of Exercise Price. No adjustment to the Exercise Price will be made (i) upon the exercise of any warrants, options or convertible securities granted, issued and outstanding on the date of
issuance of this Warrant; (ii) upon the grant or exercise of any stock or options which may hereafter be granted or exercised under any stock option plan, restricted stock plan or employee benefit plan of the Company now existing or to be
implemented in the future, so long as the issuance of such stock or options is approved by a majority of the independent members of the Board of Directors of the Company or a majority of the members of a committee of independent directors
established for such purpose; (iii) upon the exercise of the Warrants; (iv) the issuance or conversion of the Debentures; (v) upon a sale pursuant to a bona fide firm commitment underwritten public offering of Common Stock by the Company (not
including a continuous offering pursuant to Rule 415 under the Securities Act); (vi) sales in an aggregate amount not exceeding 538,262 shares (subject to adjustment for stock splits, stock dividends, stock combination and similar transactions),
(vii) securities issued by the Company in connection with an acquisition of a business, operating assets or a person, (viii) securities issued to any strategic investors, vendors, financial institutions or other lenders in connection with commercial
credit arrangements and similar financings, lessors, customers or suppliers, lease or similar arrangements the primary purpose of which is not to raise equity capital, or (ix) upon the issuance of the Restated Warrants. 
 
(c) Subdivision or Combination of Common Stock.
If the Company at any time subdivides (by any stock split, stock dividend, recapitalization, reorganization, reclassification or otherwise) the shares of Common Stock acquirable hereunder into a greater number of shares, then, after the date of
record for effecting such subdivision, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced. If the Company at any time combines (by reverse stock split, recapitalization, reorganization,
reclassification or otherwise) the shares of Common Stock acquirable hereunder into a smaller number of shares, 
 

13 

 
then, after the date of record
for effecting such combination, the Exercise Price in effect immediately prior to such combination will be proportionately increased. 
 
(d) Adjustment in Number of Shares. Upon each adjustment of the Exercise Price pursuant to the provisions of this Paragraph
6, the number of shares of Common Stock issuable upon exercise of this Warrant shall be adjusted by multiplying a number equal to the Exercise Price in effect immediately prior to such adjustment by the number of shares of Common Stock issuable upon
exercise of this Warrant immediately prior to such adjustment and dividing the product so obtained by the adjusted Exercise Price. 
 
(e) Consolidation, Merger or Sale. In case of any consolidation of the Company with, or merger of the Company into any other
corporation, or in case of any sale or conveyance of all or substantially all of the assets of the Company other than in connection with a plan of complete liquidation of the Company, adequate provision will be made whereby the holder of this
Warrant will have the right to acquire and receive upon exercise of this Warrant in lieu of the shares of Common Stock immediately theretofore acquirable upon the exercise of this Warrant, such shares of stock, securities or assets as may be issued
or payable with respect to or in exchange for the number of shares of Common Stock immediately theretofore acquirable and receivable upon exercise of this Warrant had such consolidation, merger or sale or conveyance not taken place. In any such
case, the Company will make appropriate provision to insure that the provisions of this Paragraph 6 hereof will thereafter be applicable as nearly as may be in relation to any shares of stock or securities thereafter deliverable upon the exercise of
this Warrant. 
 
(f) Notice of
Adjustment. Upon the occurrence of any event which requires any adjustment of the Exercise Price, then, and in each such case, the Company shall give notice thereof to the holder of this Warrant, which notice shall state the Exercise Price
resulting from such adjustment and the increase or decrease in the number of Warrant Shares purchasable at such price upon exercise, setting forth in reasonable detail the method of calculation and the facts upon which such calculation is based.
Such calculation shall be certified by the chief financial officer of the Company. 
 
(g) Minimum Adjustment of Exercise Price. No adjustment of the Exercise Price shall be made in an amount of less than 1% of the Exercise Price in effect at the time such adjustment is
otherwise required to be made, but any such lesser adjustment shall be carried forward and shall be made at the time and together with the next subsequent adjustment which, together with any adjustments so carried forward, shall amount to not less
than 1% of such Exercise Price. 
 
(h) No
Fractional Shares. No fractional shares of Common Stock are to be issued upon the exercise of this Warrant. If the exercise of this Warrant would result in a fractional share of Common Stock, such fractional share shall be disregarded and
the number of shares of Common Stock issuable upon exercise of the Warrant shall be the next higher number of shares. 
 
(i) Other Notices. In case at any time: 
 

14 

 
(i) the Company shall declare any dividend upon the Common Stock payable in shares of stock of any class or make any other distribution (including dividends or distributions payable in cash out of retained earnings) to the holders of
the Common Stock; 
 
(ii) the
Company shall offer for subscription pro rata to the holders of the Common Stock any additional shares of stock of any class or other rights; 
 
(iii) there shall be any capital reorganization of the Company, or reclassification of the Common Stock, or consolidation
or merger of the Company with or into, or sale of all or substantially all its assets to, another corporation or entity; or 
 
(iv) there shall be a voluntary or involuntary dissolution, liquidation or winding-up of the Company; 
 
then, in each such case, the Company shall give to the holder of this Warrant
(a) notice of the date on which the books of the Company shall close or a record shall be taken for determining the holders of Common Stock entitled to receive any such dividend, distribution, or subscription rights or for determining the holders of
Common Stock entitled to vote in respect of any such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or winding-up and (b) in the case of any such reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding-up, notice of the date (or, if not then known, a reasonable approximation thereof by the Company) when the same shall take place. Such notice shall also specify the date on which the holders of Common Stock shall
be entitled to receive such dividend, distribution, or subscription rights or to exchange their Common Stock for stock or other securities or property deliverable upon such reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation, or winding-up, as the case may be. Such notice shall be given at least 30 days prior to the record date or the date on which the Company’s books are closed in respect thereto. Failure to give any such notice or any defect therein
shall not affect the validity of the proceedings referred to in clauses (i), (ii), (iii) and (iv) above. 
 
(j) Certain Definitions. 
 
(i) “Common Stock Deemed Outstanding” shall mean the number of shares of Common Stock
actually outstanding (not including shares of Common Stock held in the treasury of the Company), plus (x) pursuant to Paragraph 6(b)(i) hereof, the maximum total number of shares of Common Stock issuable upon the exercise of Options, as of the date
of such issuance or grant of such Options, if any, and (y) pursuant to Paragraph 6(b)(ii) hereof, the maximum total number of shares of Common Stock issuable upon conversion or exchange of Convertible Securities, as of the date of issuance of such
Convertible Securities, if any. 
 
(ii) “Market Price,” as of any date, (i) means the average of the last reported sale prices for the shares of Common Stock on the New York Stock Exchange (the “NYSE”) for the five (5) trading days
immediately preceding such date as reported by Bloomberg Financial Markets or an equivalent reliable reporting service mutually acceptable to and hereafter designated by the holder of this Warrant and the Company 
 

15 

(“Bloomberg”), or (ii) if NYSE is not the principal trading market for the
shares of Common Stock, the average of the last reported sale prices on the principal trading market for the Common Stock during the same period as reported by Bloomberg, or (iii) if market value cannot be calculated as of such date on any of the
foregoing bases, the Market Price shall be the fair market value as reasonably determined in good faith by the Board of Directors of the Company and set forth in a resolution. The manner of determining the Market Price of the Common Stock set forth
in the foregoing definition shall apply with respect to any other security in respect of which a determination as to market value must be made hereunder. 
 
(iii) “Common Stock,” for purposes of this Paragraph 6, includes the Common Stock, par value $1.00
per share, and any additional class of stock of the Company having no preference as to dividends or distributions on liquidation, provided that the shares purchasable pursuant to this Warrant shall include only shares of Common Stock, par value
$1.00 per share, in respect of which this Warrant is exercisable, or shares resulting from any subdivision or combination of such Common Stock, or in the case of any reorganization, reclassification, consolidation, merger, or sale of the character
referred to in Paragraph 6(e) hereof, the stock or other securities or property provided for in such Paragraph. 
 
7. Issue Tax. The issuance of certificates for Warrant Shares upon the exercise of this Warrant shall be made without charge
to the holder of this Warrant or such shares for any issuance tax or other costs in respect thereof, provided that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance and delivery
of any certificate in a name other than the holder of this Warrant. 
 
8. No Rights or Liabilities as a Shareholder. This Warrant shall not entitle the holder hereof to any voting rights or other rights as a shareholder of the Company. No provision of this Warrant, in the absence
of affirmative action by the holder hereof to purchase Warrant Shares, and no mere enumeration herein of the rights or privileges of the holder hereof, shall give rise to any liability of such holder for the Exercise Price or as a shareholder of the
Company, whether such liability is asserted by the Company or by creditors of the Company. 
 
9. Transfer, Exchange, and Replacement of Warrant. 
 
(a) Restriction on Transfer. This Warrant and the rights granted to the holder hereof are transferable, in whole or in part,
upon surrender of this Warrant, together with a properly executed assignment in the form attached hereto, at the office or agency of the Company referred to in Paragraph 9(e) below, provided, however, that any transfer or assignment shall be subject
to the conditions set forth in Paragraph 9(f) hereof and to the applicable provisions of the Securities Purchase Agreement. Until due presentment for registration of transfer on the books of the Company, the Company may treat the registered holder
hereof as the owner and holder hereof for all purposes, and the Company shall not be affected by any notice to the contrary. Notwithstanding anything to the contrary contained herein, the registration rights described in Paragraph 10 are assignable
only in accordance with the provisions of the Registration Rights Agreement. 
 

16 

 
(b)
Warrant Exchangeable for Different Denominations. This Warrant is exchangeable, upon the surrender hereof by the holder hereof at the office or agency of the Company referred to in Paragraph 9(e) below, for new Warrants of like tenor
representing in the aggregate the right to purchase the number of shares of Common Stock which may be purchased hereunder, each of such new Warrants to represent the right to purchase such number of shares as shall be designated by the holder hereof
at the time of such surrender. 
 
(c)
Replacement of Warrant. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of this Warrant and, in the case of any such loss, theft, or destruction, upon delivery of an
indemnity agreement reasonably satisfactory in form and amount to the Company, or, in the case of any such mutilation, upon surrender and cancellation of this Warrant, the Company, at its expense, will execute and deliver, in lieu thereof, a new
Warrant of like tenor. 
 
(d) Cancellation;
Payment of Expenses. Upon the surrender of this Warrant in connection with any transfer, exchange, or replacement as provided in this Paragraph 9, this Warrant shall be promptly canceled by the Company. The Company shall pay all taxes (other
than securities transfer taxes) and all other expenses (other than legal expenses, if any, incurred by the holder or transferees) and charges payable in connection with the preparation, execution, and delivery of Warrants pursuant to this Paragraph
9. 
 
(e) Register. The Company shall
maintain, at its principal executive offices (or such other office or agency of the Company as it may designate by notice to the holder hereof), a register for this Warrant, in which the Company shall record the name and address of the person in
whose name this Warrant has been issued, as well as the name and address of each transferee and each prior owner of this Warrant. 
 
(f) Exercise or Transfer Without Registration. If, at the time of the surrender of this Warrant in connection with any
exercise, transfer, or exchange of this Warrant, this Warrant (or, in the case of any exercise, the Warrant Shares issuable hereunder), shall not be registered under the Securities Act of 1933, as amended, and under applicable state securities or
blue sky laws, the Company may require, as a condition of allowing such exercise, transfer, or exchange, (i) that the holder or transferee of this Warrant, as the case may be, furnish to the Company a written opinion of counsel, which opinion and
counsel are acceptable to the Company, to the effect that such exercise, transfer, or exchange may be made without registration under said Act and under applicable state securities or blue sky laws, (ii) that the holder or transferee execute and
deliver to the Company an investment letter in form and substance acceptable to the Company and (iii) that the transferee be an “accredited investor” as defined in Rule 501(a) promulgated under the Securities Act; provided that no such
opinion, letter or status as an “accredited investor” shall be required in connection with a transfer pursuant to Rule 144 under the Securities Act. The first holder of this Warrant, by taking and holding the same, represents to the
Company that such holder is acquiring this Warrant for investment and not with a view to the distribution thereof. 
 
10. Registration Rights. The initial holder of this Warrant (and certain assignees thereof) is entitled to the benefit of
such registration rights in respect of the Warrant Shares as are set forth in Section 2 of the Registration Rights Agreement. 
 

17 

 
11.
Notices. All notices, requests, and other communications required or permitted to be given or delivered hereunder to the holder of this Warrant shall be in writing, and shall be personally delivered, or shall be sent by certified or
registered mail or by recognized overnight mail courier, postage prepaid and addressed, to such holder at the address shown for such holder on the books of the Company, or at such other address as shall have been furnished to the Company by notice
from such holder. All notices, requests, and other communications required or permitted to be given or delivered hereunder to the Company shall be in writing, and shall be personally delivered, or shall be sent by certified or registered mail or by
recognized overnight mail courier, postage prepaid and addressed, to the office of the Company at 2051 Palomar Airport Road, Carlsbad, California, 92009, Attention: General Counsel, or at such other address as shall have been furnished to the holder
of this Warrant by notice from the Company. Any such notice, request, or other communication may be sent by facsimile, but shall in such case be subsequently confirmed by a writing personally delivered or sent by certified or registered mail or by
recognized overnight mail courier as provided above. All notices, requests, and other communications shall be deemed to have been given either at the time of the receipt thereof by the person entitled to receive such notice at the address of such
person for purposes of this Paragraph 11, or, if mailed by registered or certified mail or with a recognized overnight mail courier upon deposit with the United States Post Office or such overnight mail courier, if postage is prepaid and the mailing
is properly addressed, as the case may be. 
 
12.
Governing Law. THE CORPORATE LAWS OF THE STATE OF DELAWARE SHALL GOVERN ALL ISSUES CONCERNING THE RELATIVE RIGHTS OF THE COMPANY AND ITS STOCKHOLDERS. ALL OTHER QUESTIONS UNDER THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS). BOTH PARTIES IRREVOCABLY CONSENT TO THE NON-EXCLUSIVE JURISDICTION OF
THE UNITED STATES FEDERAL COURTS AND THE STATE COURTS LOCATED IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, WITH RESPECT TO ANY SUIT OR PROCEEDING BASED ON OR ARISING UNDER THIS STOCK PURCHASE WARRANT, THE AGREEMENTS ENTERED INTO IN CONNECTION
HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY AND IRREVOCABLY AGREE THAT ALL CLAIMS IN RESPECT OF SUCH SUIT OR PROCEEDING MAY BE DETERMINED IN SUCH COURTS. BOTH PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH SUIT OR PROCEEDING. BOTH PARTIES FURTHER AGREE THAT SERVICE OF PROCESS UPON A PARTY MAILED BY FIRST CLASS MAIL SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT OR PROCEEDING. NOTHING
HEREIN SHALL AFFECT EITHER PARTY’S RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. BOTH PARTIES AGREE THAT A FINAL NON-APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON SUCH JUDGMENT OR IN ANY OTHER LAWFUL MANNER. 
 
13. Miscellaneous. 
 

18 

 
(a)
Amendments. This Warrant and any provision hereof may only be amended by an instrument in writing signed by the Company and the holder hereof. 
 
(b) Descriptive Headings. The descriptive headings of the several paragraphs of this Warrant are inserted for purposes of
reference only, and shall not affect the meaning or construction of any of the provisions hereof. 
 
(c) Remedies. The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the
holder of this Warrant by vitiating the intent and purpose of the transactions contemplated hereby. Accordingly, the Company acknowledges that the remedy at law for a breach of its obligations under this Warrant will be inadequate and agrees, in the
event of a breach or a threatened breach in writing by the Company of the provisions of this Warrant, that the holder of this Warrant shall be entitled, in addition to all other available remedies in law or in equity, to an injunction or injunctions
to prevent or cure any breaches of the provisions of this Stock Purchase Warrant and to enforce specifically the terms and provisions of this Warrant, without the necessity of showing economic loss and without any bond or other security being
required. 
 
(d) Board
Determinations. In the event the Board of Directors of the Company exercises its obligation to determine the fair market value of the Common Stock in accordance with the terms of this Warrant, the Company shall provide to the holder hereof
together with a copy of resolution setting forth the Board of Directors’ good faith determination of the fair market value of such Common Stock a certificate setting forth in reasonable detail the process by which the Board of Directors of the
Company made its determination. 
 
[REMAINDER OF
THIS PAGE INTENTIONALLY LEFT BLANK] 
 

19 

 
IN WITNESS
WHEREOF, each of the Company has and the holder hereof caused this Warrant to be signed by its duly authorized officer. 
 

	 K2 INC.

	
	 By:
	 	

	 Name:
	 	 
	 Title:
	 	 
	
	 Dated as of June 4, 2003

 

	
	 K1 VENTURES LIMITED

	
	 By:
	 	

	 Name:
	 	 
	 Title:
	 	 

 
 
 
 
 

20 

 
FORM OF
EXERCISE AGREEMENT 
 
Dated:
                         ,              
 
To:
                             
 
The undersigned, pursuant to the provisions set forth in the within Warrant, hereby agrees to purchase
             shares of Common Stock covered by such Warrant, and makes payment herewith in full therefor at the price per share provided by such Warrant by either: 
 
             cash or official bank check in the amount of $            ; or 
 
             by Cashless Exercise in accordance with the within Warrant 
 
Please issue a certificate or certificates for such shares of Common Stock in the name of and pay any cash for any fractional share to:

 

	 Name:
	 	

	
	 Signature:
	 	

	
	 Address: 
	 	

	

	

 

	 Note:
	  	 The above signature should correspond exactly with the name on the face of the within Warrant.

 
and, if said
number of shares of Common Stock shall not be all the shares purchasable under the within Warrant, a new Warrant is to be issued in the name of said undersigned covering the balance of the shares purchasable thereunder less any fraction of a share
paid in cash. 
 

 
FORM OF
ASSIGNMENT 
 
FOR VALUE RECEIVED, the
undersigned hereby sells, assigns, and transfers all the rights of the undersigned under the within Warrant, with respect to the number of shares of Common Stock covered thereby set forth hereinbelow, to: 
 

	 Name of Assignee

	 	 Address

	 	 No of Shares

	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 
,
        and hereby irrevocably constitutes and appoints
                                
             as agent and attorney-in-fact to transfer said Warrant on the books of the within-named corporation, with full power of substitution in the premises. 
 
Dated:
                              , 200_ 
 
In the presence of: 
 

 

	 Name:
	 	

	
	 Signature: 
	 	

	 	 	 
	 Title of Signing Officer or Agent (if any):

	
	

	
	 Address: 
	 	

	
	

	
	 Note: The above signature should correspond exactly with the name on the face of the within
Warrant.Form of Amendment to Registration Rights Agreement dated June 4, 2003

 
Exhibit 4.5

 
K2 INC. 
2051 PALOMAR AIRPORT ROAD 
CARLSBAD, CA 92009 
 
June 4, 2003 
 
SPORTING GOODS INVESTMENT I, LP

SPORTING GOODS INVESTMENT II, LP 
2601 S. Bayshore Drive, Suite 1775 
Coconut Grove, FL 33133

 
Re: Amendment to Registration Rights
Agreement. 
 
Ladies and Gentlemen: 
 
Reference hereby is made to (i) the Registration Rights
Agreement dated as of February 14, 2003 (the “Registration Rights Agreement”; terms defined in the Registration Rights Agreement and not otherwise defined herein are used herein as therein defined) among K2 Inc., a Delaware corporation
(the “Company”), Sporting Goods Investment I, LP (“SPI”) and Sporting Goods Investment II, LP (“SPII”; and, together with SPI, the “Holders”) and (ii) the documents, instruments and agreements giving effect to
certain amendments to the Debentures (the “Transactions”), including without limitation the warrants to purchase 243,260 shares of the Company’s Common Stock delivered to you contemporaneously herewith. 
 
In connection with the Transactions, the Company and the
Holders hereby agree that (i) the definition of “Registrable Securities” set forth in the Registration Rights Agreement shall be amended and restated in its entirety as follows: 
 
“Registrable Securities” means (A) the Conversion Shares (as defined in the
Securities Purchase Agreement) issued or issuable upon conversion of or otherwise pursuant to the Debenture and Section 2(c) herein; (B) the Warrant Shares (as defined in the Securities Purchase Agreement) issued or issuable and any shares of
capital stock issued or issuable upon exercise of the Warrants; (C) the shares of Common Stock issued or issuable and any shares of capital stock issued or issuable upon exercise of the warrants to purchase 243,260 shares of Common Stock issued by
the Company to the Initial Investors on or about June 4, 2003 (the “New Warrants”); and (D) any shares of capital stock issued or issuable as a dividend on or in exchange for or otherwise with respect to any of the foregoing; 
 
(ii) Solely with respect to the New Warrants, the “Filing Date”
shall mean and refer to the date that is 60 days from the effective date of the Transactions; and (iii) solely with respect to the 
 

 
New Warrants, the
“Registration Deadline” shall mean and refer to the date that is 120 days from the effective date of the Transactions. 
 
Except as expressly set forth herein, this letter shall not operate as a waiver or an amendment of any terms, conditions, rights, or
privileges of the Holders under the Registration Rights Agreement. Except as expressly set forth herein, all other terms of the Registration Rights Agreement remain in full force and effect. 
 
Please acknowledge your agreement with the foregoing by
signing where indicated below and returning an executed counterpart of this letter to the undersigned. 
 

	 Very truly yours,

	
	 K2 INC.

	
	 By:
	 	

	 Name:
	 	

	 Title:
	 	

 
AGREED AND
ACKNOWLEDGED 
as of the date first above written. 
 

	
	 SPORTING GOODS INVESTMENT I, LP

	 By:
	 	 K-1 USA VENTURES, INC.,   
 its sole general partner

	
	 By:
	 	

	 Name:
	 	

	 Title:
	 	

	
	 SPORTING GOODS INVESTMENT II, LP

	 By:
	 	 K-1 HOLDINGS EQUITY I, INC.,   
 its general partner     

	
	 By:
	 	

	 Name:
	 	

	 Title:
	 	

 
 

2

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