Document:

exhibit103.htm

 

 

	
EXECUTION VERSION

 

 

AMENDMENT NO. 2 TO CREDIT AGREEMENT 

AND JOINDER AGREEMENT

 

This Amendment No. 2 to Credit Agreement and Joinder Agreement (this “Amendment”) dated as of July 17, 2008, is made by and among CARMAX AUTO SUPERSTORES, INC., a Virginia corporation (the “Revolving Borrower”), the Subsidiaries of the Company (other than the Revolving Borrower) listed as “Borrowers” on the signature pages hereto (each a “Designated Borrower” and, together with the Revolving Borrower, the “Borrowers” and, each a “Borrower”), CARMAX, INC., a Virginia corporation (the “Company”), the Subsidiaries of the Company listed as “Subsidiary Guarantors” on the signature pages hereto (each a “Subsidiary Guarantor” and collectively, the “Subsidiary Guarantors”), BANK OF AMERICA, N.A., a national banking association organized and existing under the laws of the United States (“Bank of America”), in its capacity as administrative agent for the Lenders (as defined in the Credit Agreement described below) (in such capacity, the “Administrative Agent”), each of the existing Lenders under such Credit Agreement (collectively, the “Existing Lenders”), and each of the Persons becoming Lenders by the execution of this Amendment (the “Joining Lenders”).

 

W I T N E S S E T H:

 

WHEREAS, the Borrowers, the Company, the Administrative Agent, Bank of America, as Swing Line Lender, New Vehicle Swing Line Lender and L/C Issuer, and the Existing Lenders have entered into that certain Credit Agreement dated as of August 24, 2005, as amended by Amendment No. 1 to Credit Agreement and Joinder Agreement dated as of December 8, 2006 (the “Credit Agreement”; capitalized terms used in this Amendment not otherwise defined herein shall have the respective meanings given thereto in the Credit Agreement), pursuant to which the Existing Lenders have made available to the Borrowers a revolving credit facility with letter of credit and swing line subfacilities; and

 

WHEREAS, the Subsidiary Guarantors and the Administrative Agent have entered into that certain Subsidiary Guaranty Agreement dated as of August 24, 2005 pursuant to which the Subsidiary Guarantors have guaranteed the payment and performance of the obligations of the Borrowers under the Credit Agreement and the other Loan Documents; and

 

WHEREAS, the Company and the Administrative Agent have entered into that certain Company Guaranty Agreement dated as of August 24, 2005 pursuant to which the Company has guaranteed the payment and performance of the obligations of the Borrowers under the Credit Agreement and the other Loan Documents; and

 

WHEREAS, the Company and the Borrowers have advised the Administrative Agent and the Existing Lenders that they desire to amend certain provisions of the Credit Agreement to,

 

  

  

  

among other things, (i) amend the definition of the Applicable Rate, (ii) amend the timing for payments of Swing Line Loans and New Vehicle Swing Line Loans, and (iii) increase the Aggregate Commitments from $500,000,000 to $700,000,000 (such increase to be allocated among the Joining Lenders and certain of the Existing Lenders), in each case as more particularly set forth below, and the Administrative Agent, the Existing Lenders and the Joining Lenders are willing to effect such amendments on the terms and conditions contained in this Amendment;

 

NOW, THEREFORE, in consideration of the premises and further valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

 

1. Amendments to Credit Agreement.  Subject to the terms and conditions set forth herein, the Credit Agreement is hereby amended as follows:

 

	
(a)  

	
The existing definition of “Applicable Rate” in Section 1.01 is deleted in its entirety and the following is inserted in lieu thereof:

 

“Applicable Rate” means a per annum rate equal to:

 

(a)            with respect to Base Rate Loans, 0.00%;

 

(b)            with respect to Eurodollar Rate Loans, 1.25%;

 

(c)            with respect to Letter of Credit Fees, 1.25%; and

 

(d)           with respect to the Commitment Fee, 0.20%.

 

	
(b)  

	
Sections 2.08(b) and 2.08(c) of the Credit Agreement are amended, so that, as amended, such sections shall read as follows

 

(b)            The Revolving Borrower shall repay each Swing Line Loan (i) on at least one Business Day of each month (other than Swing Line Loans advanced on such day), (ii) at any time on demand by the Swing Line Lender and (iii) on the Maturity Date.

 

(c)           The Borrowers (jointly and severally) shall repay each New Vehicle Swing Line Loan (i) on at least one Business Day of each month (other than New Vehicle Swing Line Loans advanced on such day), (ii) at any time on demand by the New Vehicle Swing Line Lender and (iii) on the Maturity Date.

 

	
(c)  

	
The existing Schedule 2.01 is deleted it in its entirety and Schedule 2.01 attached hereto is inserted in lieu thereof.

 

  

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2. Joinder of the Joining Lenders; Funding of Loans with Incremental Commitments.

 

(a) By its execution of this Amendment, each Joining Lender hereby confirms and agrees that, on and after the date this Amendment becomes effective (the “Amendment Effective Date”), it shall be and become a party to the Credit Agreement as a Lender, and shall have all of the rights and be obligated to perform all of the obligations of a Lender thereunder with the Commitment applicable to such Lender identified on Schedule 2.01 attached hereto.  Each Joining Lender further (i) acknowledges that it has received a copy of the Credit Agreement and the schedules and exhibits thereto and such other documents and information as it has deemed appropriate to make its own credit and legal analysis and decision to enter into this Amendment; (ii) acknowledges that it has independently and without reliance upon the Administrative Agent, the L/C Issuer, or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Amendment and to become a Lender, and (iii) agrees that it will, independently and without reliance upon the Administrative Agent, the L/C Issuer or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit and legal decisions in taking or not taking action under the Credit Agreement and the other Loan Documents.  On and after the Amendment Effective Date, all references to the “Lenders” in the Credit Agreement shall be deemed to include the Joining Lenders.

 

(b) On the Amendment Effective Date, (i) each Existing Lender that is increasing its Commitment and each Joining Lender shall make available to the Administrative Agent such amounts in immediately available funds as the Administrative Agent shall determine, for the benefit of the other relevant Lenders, as being required in order to cause, after giving effect to such increase and joinder and the application of such amounts to make payments to such other relevant Existing Lenders, the outstanding Committed Loans (and risk participations in outstanding Swing Line Loans, New Vehicle Swing Line Loans and L/C Obligations) to be held ratably by all Lenders in accordance with their respective Applicable Percentages (as revised by this Amendment), and (ii) the Revolving Borrower shall be deemed to have prepaid and reborrowed the outstanding Committed Loans as of the Amendment Effective Date to the extent necessary to keep the outstanding Committed Loans ratable with any revised Applicable Percentages arising from any nonratable increase in the Commitments under this Amendment and the joinder of the Joining Lenders.

 

(c) Upon the Amendment Effective Date, the Commitment of each Lender will be as set forth on Schedule 2.01 attached hereto.

 

(d) The parties hereto acknowledge that, notwithstanding the increase in the Commitments provided herein, Section 2.16 of the Credit Agreement shall remain in full force and effect after giving effect to the amendments and joinders provided herein and the amount of any additional increase in Commitments made after the date hereof in accordance with Section 2.16 of the Credit Agreement shall not exceed $100,000,000.

 

  

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3. Effectiveness; Conditions Precedent.  The effectiveness of this Amendment and the amendments to the Credit Agreement herein provided are subject to the satisfaction of the following conditions precedent:

 

(a) the Administrative Agent shall have received each of the following documents or instruments in form and substance reasonably acceptable to the Administrative Agent:

 

(i) counterparts of this Amendment, duly executed by the Company, the Administrative Agent, the Borrowers, the Subsidiary Guarantors, the Required Lenders, each of the Existing Lenders that is increasing any Commitment pursuant to this Amendment, and each of the Joining Lenders (which Joining Lenders are listed on Schedule 2.01 attached hereto);

 

(ii) evidence of the existence, good standing, authority and capacity of the Company, the Borrowers and the Subsidiary Guarantors to execute, deliver and perform its obligations under the Credit Agreement as amended hereby, including, (x) a true and complete copy of resolutions for each of the Borrowers, the Company and the Subsidiary Guarantors approving the amendments contemplated hereby, and (y) a certification that the certificate of incorporation, articles of organization, by-laws or operating agreement, as applicable, of each of the Borrowers, the Company and the Subsidiary Guarantors have not been amended or otherwise modified since the effective date of the Credit Agreement or, in the alternative, attaching true and complete copies of all amendments and modifications thereto;

 

(iii) a certificate signed by a Responsible Officer of the Company certifying (A) as to the representations and warranties set forth in Section 6(a), and (B) as to the absence of any action, suit, investigation or proceeding pending or, to the knowledge of the Company, threatened in any court or before any arbitrator or governmental authority that could reasonably be expected have a Material Adverse Effect; and

 

(iv) such other documents, instruments, opinions, certifications, undertakings, further assurances and other matters as the Administrative Agent, the L/C Issuer or any Lender shall reasonably request;

 

(b) the Company shall have paid the fees, including fees for the benefit of the Joining Lenders and those Existing Lenders that are increasing any commitments pursuant to Section 2(a) hereof, in the amounts and at the times specified in the letter agreement, dated as of May 20, 2008, among the Company, the Administrative Agent and BAS (the “Amendment Fee Letter”); and

 

  

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(c) unless waived by the Administrative Agent, all fees and expenses payable to the Administrative Agent and the Lenders (including the fees and expenses of counsel to the Administrative Agent to the extent invoiced prior to the date hereof) estimated to date shall have been paid in full (without prejudice to final settling of accounts for such fees and expenses).

 

4. Consent of the Subsidiary Guarantors.  Each of the Subsidiary Guarantors hereby consents, acknowledges and agrees to the amendments set forth herein and hereby confirms and ratifies in all respects the Subsidiary Guaranty Agreement (including without limitation the continuation of such Subsidiary Guarantor’s payment and performance obligations thereunder upon and after the effectiveness of this Amendment and the amendments contemplated hereby) and the enforceability of the Subsidiary Guaranty Agreement against such Subsidiary Guarantor in accordance with its terms.

 

5. Consent of the Company.  The Company hereby consents, acknowledges and agrees to the amendments set forth herein and hereby confirms and ratifies in all respects the Company Guaranty Agreement (including without limitation the continuation of the Company’s payment and performance obligations thereunder upon and after the effectiveness of this Amendment and the amendments contemplated hereby) and the enforceability of the Company Guaranty Agreement against the Company in accordance with its terms.

 

6. Representations and Warranties.  In order to induce the Administrative Agent, the Existing Lenders and the Joining Lenders to enter into this Amendment, each of the Company and the Borrowers represent and warrant to the Administrative Agent, the Existing Lenders and the Joining Lenders as follows:

 

(a) Before and after giving effect to this Amendment, (A) the representations and warranties of the Company and the Borrowers contained in Article V of the Credit Agreement and the representations and warranties of each Loan Party contained in each other Loan Document are true and correct on and as of the Amendment Effective Date, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct as of such earlier date, and except that the representations and warranties contained in subsections (a) and (b) of Section 5.05 of the Credit Agreement shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01 of the Credit Agreement, and (B) no Default exists;

 

(b) Since the date of the most recent financial reports of the Company and its Subsidiaries delivered pursuant to Section 6.01(a) of the Credit Agreement, there has been no event or circumstance, either individually or in the aggregate, that has had or would reasonably be expected to have a Material Adverse Effect;

 

  

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(c) The Subsidiary Guarantors are the only Persons that are required to be a party to the Subsidiary Guaranty Agreement pursuant to the terms of the Credit Agreement; and

 

(d) This Amendment has been duly authorized, executed and delivered by the Company, each of the Borrowers and each of the Subsidiary Guarantors and constitutes a legal, valid and binding obligation of such parties, except as may be limited by general principles of equity or by the effect of any applicable bankruptcy, insolvency, reorganization, moratorium or similar law affecting creditors’ rights generally.

 

7. Entire Agreement.  This Amendment, together with the Amendment Fee Letter and the Loan Documents (collectively, the “Relevant Documents”), sets forth the entire understanding and agreement of the parties hereto in relation to the subject matter hereof and supersedes any prior negotiations and agreements among the parties relating to such subject matter.  No promise, condition, representation or warranty, express or implied, not set forth in the Relevant Documents shall bind any party hereto, and no such party has relied on any such promise, condition, representation or warranty.  Each of the parties hereto acknowledges that, except as otherwise expressly stated in the Relevant Documents, no representations, warranties or commitments, express or implied, have been made by any party to any other party in relation to the subject matter hereof or thereof.  None of the terms or conditions of this Amendment may be changed, modified, waived or canceled orally or otherwise, except in writing and in accordance with Section 10.01 of the Credit Agreement.

 

8. Full Force and Effect of Agreement.  Except as hereby specifically amended, modified or supplemented, the Credit Agreement and all other Loan Documents are hereby confirmed and ratified in all respects and shall be and remain in full force and effect according to their respective terms.

 

9. Counterparts.  This Amendment may be executed in any number of counterparts, each of which shall be deemed an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument.  Delivery of an executed counterpart of a signature page of this Amendment by telecopy shall be effective as a manually executed counterpart of this Amendment.

 

10. Governing Law.  This Amendment shall in all respects be governed by, and construed in accordance with, the laws of the State of New York applicable to contracts executed and to be performed entirely within such State, and shall be further subject to the provisions of Sections 10.14 and 10.15 of the Credit Agreement.

 

11. Enforceability.  Should any one or more of the provisions of this Amendment be determined to be illegal or unenforceable as to one or more of the parties hereto, all other provisions nevertheless shall remain effective and binding on the parties hereto.

 

  

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12. References.  All references in any of the Loan Documents to the “Credit Agreement” shall mean the Credit Agreement, as amended hereby, and as otherwise amended, modified, supplemented or restated from time to time by any other instrument in accordance with the terms thereof.

 

13. Successors and Assigns.  This Amendment shall be binding upon and inure to the benefit of the Company, the Administrative Agent, the Borrowers, the Subsidiary Guarantors, the Lenders and their respective successors, legal representatives, and assignees to the extent such assignees are permitted assignees as provided in Section 10.06 of the Credit Agreement.

 

[Signature pages follow.]

  

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IN WITNESS WHEREOF, the parties hereto have caused this instrument to be made, executed and delivered by their duly authorized officers as of the day and year first above written.

COMPANY:

 

 

CARMAX, INC.

 

By:      /s/ Keith D. Browning                                                             

Name: Keith D. Browning                                                             

Title:   Executive Vice President and Chief                                                             

Financial Officer                                                             

 

 

BORROWERS:

 

 

CARMAX AUTO SUPERSTORES, INC.

CARMAX OF LAUREL, LLC

CARMAX AUTO MALL, LLC

CARMAX AUTO SUPERSTORES CALIFORNIA, LLC

 

By:      /s/ Keith D. Browning                                                             

Name: Keith D. Browning                                                             

Title:   Executive Vice President and Chief                                                             

Financial Officer                                                                               

 

 

SUBSIDIARY GUARANTORS:

 

                        

CARMAX OF LAUREL, LLC

CARMAX AUTO MALL, LLC

CARMAX AUTO SUPERSTORES CALIFORNIA, LLC

CARMAX BUSINESS SERVICES, LLC

CARMAX AUTO SUPERSTORES WEST COAST, INC.

CARMAX AUTO SUPERSTORES SERVICES, INC.

                                                     

By:      /s/ Keith D. Browning                                                             

Name: Keith D. Browning                                                             

Title:   Executive Vice President and Chief                                                             

Financial Officer     

 

 

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

CARMAX PROPERTIES, LLC

 

By:               /s/ Keith D. Browning 

Name:          Keith D. Browning                                                                           

Title:            President and Chief Financial Officer 

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

ADMINISTRATIVE AGENT:

 

 

BANK OF AMERICA, N.A., as

Administrative Agent

 

By: /s/ Anne M. Zeschke                                                            

Name: Anne M. Zeschke                                                            

Title: Vice President                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

EXISTING LENDERS:

 

 

BANK OF AMERICA, N.A., as a Lender, L/C Issuer, Swing Line Lender and New Vehicle Swing Line Lender

 

By: /s/ M. Patricia Kay                                                            

Name: M. Patricia Kay                                                            

Title: Senior Vice President                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

JPMORGAN CHASE BANK, N.A., as a Lender

 

By: /s/ H. David Jones                                                            

Name: H. David Jones                                                            

Title: Senior Vice President                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

WACHOVIA BANK, NATIONAL ASSOCIATION, as a Lender

 

By: /s/ Mark S. Supple                                                            

Name: Mark S. Supple                                                            

Title: Vice President                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

SUNTRUST BANK, as a Lender

 

By: /s/ Mark A. Flatin                                                            

Name: Mark A. Flatin                                                            

Title: Managing Director                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

TOYOTA MOTOR CREDIT CORPORATION, as a Lender

 

By: /s/ Mark Doi                                                            

Name: Mark Doi                                                            

Title: National Dealer Credit Manager                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

WELLS FARGO BANK, N.A., as a Lender

 

By: /s/ Penelope Pilcher                                                            

Name: Penelope Pilcher                                                            

Title: Vice President                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

SCOTIABANC INC., as a Lender

 

By:  /s/ J. F. Todd                                                            

Name: J. F. Todd                                                            

Title: Managing Director                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

CREDIT SUISSE, CAYMAN ISLAND BRANCH, as a Lender

 

By: /s/ Doreen Barr                                                            

Name: Doreen Barr                                                            

Title: Vice President                                                            

 

By: /s/ Shaheen Malik                                                            

Name: Shaheen Malik                                                            

Title: Associate                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

ROYAL BANK OF CANADA, as a Lender

 

By: /s/ Scott Umbs                                                            

Name: Scott Umbs                                                            

Title: Authorized Signatory                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

U.S. BANK NATIONAL ASSOCIATION, as

a Lender

 

By: /s/ Jonathan Horton                                                            

Name: Jonathan Horton                                                            

Title: Senior Vice President                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

COMERICA BANK, as a Lender

By: /s/ Joseph M. Davignon                                                            

Name: Joseph M. Davignon                                                            

Title:  Senior Vice President                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

JOINING LENDERS:

 

 

BANK OF THE WEST, as a Joining Lender

By: /s/ Michael Lax                                                            

Name: Michael Lax                                                            

Title: Senior Vice President                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

JOINING LENDERS:

 

 

BARCLAYS BANK PLC, as a Joining Lender

By: /s/ Nicholas A. Bell                                                            

Name: Nicholas A. Bell                                                            

Title: Director                                                            

Signature Page to Amendment No. 2

to Credit Agreement and Joinder Agreement

  

  

  

SCHEDULE 2.01

COMMITMENTS

AND APPLICABLE PERCENTAGES

	
Lender

	  	
Commitment

	  	
Applicable

Percentage

	  
	
Bank of America, N.A.

	  	
$

	
119,000,000.00

	  	
17.000000000%

	
SunTrust Bank

	  	
$

	
80,000,000.00

	  	
11.428571429%

	
Toyota Motor Credit Corporation

	  	
$

	
80,000,000.00

	  	
11.428571429%

	
JPMorgan Chase Bank, N.A.

	  	
$

	
68,000,000.00

	  	
9.714285714%

	
Wachovia Bank, National Association

	  	
$

	
68,000,000.00

	  	
9.714285714%

	
U.S. Bank National Association

	  	
$

	
60,000,000.00

	  	
8.571428571%

	
Wells Fargo Bank, N.A.

	  	
$

	
40,000,000.00

	  	
5.714285714%

	
Scotiabanc Inc.

	  	
$

	
30,000,000.00

	  	
4.285714286%

	
Comerica Bank

	  	
$

	
30,000,000.00

	  	
4.285714286%

	
Credit Suisse, Cayman Island Branch

	  	
$

	
30,000,000.00

	  	
4.285714286%

	
Fifth Third Bank

	  	
$

	
30,000,000.00

	  	
4.285714286%

	
Royal Bank of Canada

	  	
$

	
30,000,000.00

	  	
4.285714286%

	
Bank of the West

	  	
$

	
20,000,000.00

	  	
2.857142857%

	
Barclays Bank PLC

	  	
$

	
15,000,000.00

	  	
2.142857143%

	
Total

	  	
$

	
700,000,000.00

	  	
100.000000000%exhibit_4-1.htm

Exhibit 4.1

 

THIS WARRANT AND THE SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL SATISFACTORY TO THE COMPANY TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.

PLURISTEM THERAPEUTICS INC.

COMMON STOCK PURCHASE WARRANT

	
Warrant No.:

	  	
Original Issue Date: October 18, 2010

	
Initial Holder:

	
Initial Exercisable Date:  April 18, 2011

	  	
No. of Shares Subject to Warrant:

	  	
Exercise Price Per Share: $ 1.80

	  	
Expiration Time:  4 p.m., New York time, on October

18, 2014  (subject to acceleration as provided herein)

	  

 

Pluristem Therapeutics Inc., a Nevada corporation (the ”Company”), hereby certifies that, for value received, the Initial Holder shown above, or its permitted registered assigns (the ”Holder”), is entitled to purchase from the Company up to the number of shares of its common stock shown above (the ”Common Stock”) (each such share, a “Warrant Share” and all such shares, the “Warrant Shares”) at the exercise price shown above (as may be adjusted from time to time as provided herein, the ”Exercise Price”), at any time and from time to time on or after the Initial Exercisable Date shown above and through and including the Expiration Time shown above (the “Expiration Time”), and subject to the following terms and conditions:

This Warrant is being issued pursuant to a Securities Purchase Agreement, dated October 12, 2010 (the “Subscription Agreement”), by and between the Company and the Initial Holder. 

1.             Definitions. In addition to the terms defined elsewhere in this Warrant, capitalized terms that are not otherwise defined herein have the meanings given to such terms in the Subscription Agreement.

2.             List of Warrant Holders.  The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “Warrant Register”), in the name of the record Holder (which shall include the Initial Holder or, as the case may be, any registered assignee to which this Warrant is permissibly assigned hereunder from time to time).  The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.

3.             List of Transfers; Restrictions on Transfer. The Company shall register any transfer of all or any portion of this Warrant in the Warrant Register, upon surrender of this Warrant, with the Form of Assignment attached hereto duly completed and signed, to the Company at its address specified herein. Upon any such registration or transfer, a new Warrant to purchase Common Stock, in substantially the form of this Warrant (any such new Warrant, a “New Warrant”), evidencing the portion of this Warrant so transferred shall be issued to the transferee and a New Warrant evidencing the remaining portion of this Warrant not so transferred, if any, shall be issued to the transferring Holder. The acceptance of the New Warrant by the transferee thereof shall be deemed the acceptance by such transferee of all of the rights and obligations in respect of the New Warrant that the Holder has in respect of this Warrant.

  

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4.             Exercise and Duration of Warrant.

 (a)          All or any part of this Warrant shall be exercisable by the registered Holder in any manner permitted by Section 10 of this Warrant at any time and from time to time on or after the Initial Exercisable Date and through and including the Expiration Time. Subject to Section 11 hereof, at the Expiration Time, the portion of this Warrant not exercised prior thereto shall be and become void and of no value and this Warrant shall be terminated and shall no longer be outstanding.

(b)           The Holder may exercise this Warrant by delivering to the Company (i) an exercise notice, in the form attached hereto (the ”Exercise Notice”), completed and duly signed, and (ii) if such Holder is not utilizing the cashless exercise provisions set forth in this Warrant, payment of the Exercise Price for the number of Warrant Shares as to which this Warrant is being exercised.  The date such items are delivered to the Company (as determined in accordance with the notice provisions hereof) is an ”Exercise Date .” The Holder shall not be required to deliver the original Warrant in order to effect an exercise hereunder, but if it is not so delivered then such exercise shall constitute an agreement by the Holder to deliver the original Warrant to the Company as soon as practicable thereafter.  Execution and delivery of the Exercise Notice shall have the same effect as cancellation of the original Warrant and issuance of a New Warrant evidencing the right to purchase the remaining number of Warrant Shares.

5.             Delivery of Warrant Shares.

(a)           Upon exercise of this Warrant, the Company shall promptly (but in no event later than three (3) Trading Days after the Exercise Date) issue or cause to be issued and cause to be delivered to or upon the written order of the Holder and in such name or names as the Holder may designate, a certificate for the Warrant Shares issuable upon such exercise, free of restrictive legends. “Trading Day” shall mean a date on which the Company’s Common Stock trades on its principal trading market. The Holder, or any Person permissibly so designated by the Holder to receive Warrant Shares, shall be deemed to have become the holder of record of such Warrant Shares as of the Exercise Date.  The Company shall, upon the written request of the Holder, use its best efforts to deliver, or cause to be delivered, Warrant Shares hereunder electronically through the Depository Trust and Clearing Corporation or another established clearing corporation performing similar functions, if available; provided, that, the Company may, but will not be required to, change its transfer agent if its current transfer agent cannot deliver Warrant Shares electronically through the Depository Trust and Clearing Corporation.  If as of the time of exercise the Warrant Shares constitute restricted or control securities, the Holder, by exercising, agrees not to resell them except in compliance with all applicable securities laws.

(b)           To the extent permitted by law, the Company’s obligations to issue and deliver Warrant Shares in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law by the Holder or any other Person, and irrespective of any other circumstance that might otherwise limit such obligation of the Company to the Holder in connection with the issuance of Warrant Shares. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver certificates representing shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.

  

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6.             Charges, Taxes and Expenses. Issuance and delivery of certificates for shares of Common Stock upon exercise of this Warrant shall be made without charge to the Holder for any issue or transfer tax, withholding tax, transfer agent fee or other incidental tax or expense in respect of the issuance of such certificates, all of which taxes and expenses shall be paid by the Company;  provided, however, that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the registration of any certificates for Warrant Shares or the Warrants in a name other than that of the Holder. The Holder shall be responsible for all other tax liability that may arise as a result of holding or transferring this Warrant or receiving Warrant Shares upon exercise hereof.

7.             Replacement of Warrant.  If this Warrant is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation hereof, or in lieu of and substitution for this Warrant, a New Warrant, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction and customary and reasonable indemnity, if requested. Applicants for a New Warrant under such circumstances shall also comply with such other reasonable regulations and procedures and pay such other reasonable third-party costs as the Company may prescribe. If a New Warrant is requested as a result of a mutilation of this Warrant, then the Holder shall deliver such mutilated Warrant to the Company as a condition precedent to the Company’s obligation to issue the New Warrant.

8.             Reservation of Warrant Shares. The Company covenants that it will at all times reserve and keep available out of the aggregate of its authorized but unissued and otherwise unreserved Common Stock, solely for the purpose of enabling it to issue Warrant Shares upon exercise of this Warrant as herein provided, the number of Warrant Shares that are then issuable and deliverable upon the exercise of this entire Warrant, free from preemptive rights or any other contingent purchase rights of persons other than the Holder (taking into account the adjustments and restrictions of Section 9). The Company covenants that all Warrant Shares so issuable and deliverable shall, upon issuance and the payment of the applicable Exercise Price in accordance with the terms hereof, be duly and validly authorized, issued and fully paid and nonassessable.

9.             Certain Adjustments; Termination Under Certain Circumstances. The Exercise Price and number of Warrant Shares issuable upon exercise of this Warrant are subject to adjustment from time to time as set forth in this Section 9.

(a)           Stock Dividends and Splits. If the Company, at any time while this Warrant is outstanding, (i) pays a stock dividend on its Common Stock or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides outstanding shares of Common Stock into a larger number of shares, or (iii) combines outstanding shares of Common Stock into a smaller number of shares, then in each such case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event. Any adjustment made pursuant to clause (i) of this paragraph shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution, and any adjustment pursuant to clause (ii) or (iii) of this paragraph shall become effective immediately after the effective date of such subdivision or combination.

  

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(b)           Pro Rata Distributions.  If the Company, at any time while this Warrant is outstanding, distributes to all holders of Common Stock for no consideration (i) evidences of its indebtedness, (ii) any security (other than a distribution of Common Stock covered by the preceding paragraph), (iii) rights or warrants to subscribe for or purchase any security, or (iv) any other asset besides cash (in each case, ”Distributed Property”), then either upon any exercise of this Warrant that occurs after the record date fixed for determination of stockholders entitled to receive such distribution or, at the option of the Company, concurrently with such distribution, the Holder shall be entitled to receive, in addition to the Warrant Shares otherwise issuable upon such exercise (if applicable), the Distributed Property that such Holder would have been entitled to receive in respect of such number of Warrant Shares had the Holder been the record holder of such Warrant Shares immediately prior to such record date.

(c)           Fundamental Transactions. As used herein, “Fundamental Transaction” means  at any time while this Warrant is outstanding  (i) the Company effects any merger of the Company with another Person, in which the shareholders of the Company immediately prior to the transaction own immediately after the transaction less than a majority of the outstanding stock of the successor entity, or its parent if applicable, (ii) the Company effects any sale of all or substantially all of its assets in one or a series of related transactions, (iii) any tender offer or exchange offer approved or authorized by the Company’s Board of Directors is completed pursuant to which holders of at least a majority of the outstanding Common Stock tender or exchange their shares for other securities, cash or property, or (iv) the Company effects any reclassification of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property.  In the event of a Fundamental Transaction pursuant to which the securities, cash or property issuable with respect to the outstanding Common Stock consist solely of cash and/or securities traded on a national securities exchange or an established over-the-counter market (the “Alternate Consideration”), this Warrant shall expire immediately prior to the closing of the Fundamental Transaction.  The Company shall not effect any such Fundamental Transaction unless prior to or simultaneously with the consummation thereof, any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity shall assume the obligation to deliver to the Holder, such Alternate Consideration as, in accordance with the foregoing provisions, the Holder shall be entitled to receive upon proper exercise of this Warrant prior to such closing. In the event of a Fundamental Transaction in which the consideration does not entirely consist of the Alternate Consideration, the Company (or the successor entity) shall purchase this Warrant from the Holder by paying to the Holder, within ten (10) Business Days after the closing of such Fundamental Transaction cash in an amount equal to the Black Scholes Value (as reasonably determined by the Board of Directors of the Company or the Company’s financial advisor in the Fundamental Transaction) of the remaining unexercised portion of this Warrant on the date of such Fundamental Transaction determined as of the day immediately following the public announcement of the applicable Fundamental Transaction.

(d)           Number of Warrant Shares. Simultaneously with any adjustment to the Exercise Price pursuant to paragraph (a) of this Section 9, the number of Warrant Shares that may be purchased upon exercise of this Warrant shall be increased or decreased proportionately, so that after such adjustment the aggregate Exercise Price payable hereunder for the adjusted number of Warrant Shares shall be the same as the aggregate Exercise Price in effect immediately prior to such adjustment.

(e)           Calculations. All calculations under this Section 9 shall be made to the nearest cent or the nearest 1/100th  of a share, as applicable. The number of shares of Common Stock outstanding at any given time shall not include shares owned or held by or for the account of the Company, and the disposition of any such shares shall be considered an issue or sale of Common Stock.

  

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(f)            Notice of Adjustments. Upon the occurrence of each adjustment pursuant to this Section 9, the Company at its expense will, at the written request of the Holder, promptly compute such adjustment in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment, in good faith, including a statement of the adjusted Exercise Price and adjusted number or type of Warrant Shares or other securities issuable upon exercise of this Warrant (as applicable), describing the transactions giving rise to such adjustments and showing in detail the facts upon which such adjustment is based. Upon written request, the Company will promptly deliver a copy of each such certificate to the Holder and to the Company’s transfer agent for the Common Stock.

(g)           Notice of Corporate Events. If, while this Warrant is outstanding, the Company (i) declares a dividend or any other distribution of cash, securities or other property in respect of its Common Stock, including without limitation any granting of rights or warrants to subscribe for or purchase any capital stock of the Company or any Subsidiary, (ii) authorizes or approves, enters into any agreement contemplating or solicits stockholder approval for any Fundamental Transaction or (iii) authorizes the voluntary dissolution, liquidation or winding up of the affairs of the Company, then, except if such notice and the contents thereof shall be deemed to constitute material non-public information, the Company shall deliver to the Holder a notice describing the material terms and conditions of such transaction at least ten (10) Trading Days prior to the applicable record or effective date on which a Person would need to hold Common Stock in order to participate in or vote with respect to such transaction, and the Company will take all reasonable steps to give Holder the practical opportunity to exercise this Warrant prior to such time;  provided, however, that the failure to deliver such notice or any defect therein shall not affect the validity of the corporate action required to be described in such notice.

10.           Payment of Exercise Price. The Holder may pay the Exercise Price in one of the following manners:

(a)           Cash Exercise. If an Exercise Notice is delivered at a time when a registration statement covering the resale of the Warrant Shares is effective, then the Holder shall deliver immediately available funds; or

(b)           Cashless Exercise. If an Exercise Notice is delivered at a time when a registration statement covering the resale of the Warrant Shares is not effective, then the Holder shall notify the Company in an Exercise Notice of its election to utilize cashless exercise, in which event the Company shall issue to the Holder the number of Warrant Shares determined as follows:

X = Y [(A-B)/A]

where:

X = the number of Warrant Shares to be issued to the Holder.

Y = the number of Warrant Shares with respect to which this Warrant is being exercised.

A = the closing price on the Trading Day immediately prior to the Exercise Date.

B = the Exercise Price then in effect.

                11.           Limitations on Exercise. (a)     Notwithstanding anything to the contrary contained herein, the number of Warrant Shares that may be acquired by the Holder upon any exercise of this Warrant (or otherwise in respect hereof) shall be limited to the extent necessary to ensure that, following such exercise (or other issuance), the total number of shares of Common Stock then beneficially owned by the Holder and its Affiliates and any other Persons whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of the Securities Exchange Act of 1934 (the “Exchange Act”), does not exceed 4.999% of the total number of issued and outstanding shares of Common Stock (including for such purpose the shares of Common Stock issuable upon such exercise). For such purposes, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. Each delivery of an Exercise Notice by the Holder will constitute a representation by the Holder that it has evaluated the limitation set forth in this Section and determined that issuance of the full number of Warrant Shares requested in such Exercise Notice is permitted under this Section.  The Company’s obligation to issue shares of Common Stock in excess of the limitation referred to in this Section shall be suspended (and, except as provided below, shall not terminate or expire notwithstanding any contrary provisions hereof) until such time, if any, as such shares of Common Stock may be issued in compliance with such limitation; provided, that, if, as of the Expiration Time, the Company has not received written notice that the shares of Common Stock may be issued in compliance with such limitation, the Company’s obligation to issue such shares shall terminate.  This provision shall not restrict the number of shares of Common Stock which a Holder may receive or beneficially own in order to determine the amount of securities or other consideration that such Holder may receive in the event of a Fundamental Transaction as contemplated in Section 9 of this Warrant.  By written notice to the Company, the Holder may waive the provisions of this Section but any such waiver will not be effective until the sixty-first (61st) day after such notice is delivered to the Company, nor will any such waiver affect any other Holder.

 

  

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                (b)           Notwithstanding anything to the contrary contained herein, the number of Warrant Shares that may be acquired by the Holder upon any exercise of this Warrant (or otherwise in respect hereof) shall be limited to the extent necessary to ensure that, following such exercise (or other issuance), the total number of shares of Common Stock then beneficially owned by such Holder and its Affiliates and any other Persons whose beneficial ownership of Common Stock would be aggregated with the Holder’s for purposes of Section 13(d) of the Exchange Act, does not exceed 9.999% of the total number of issued and outstanding shares of Common Stock (including for such purpose the shares of Common Stock issuable upon such exercise). For such purposes, beneficial ownership shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. Each delivery of an Exercise Notice hereunder will constitute a representation by the Holder that it has evaluated the limitation set forth in this Section and determined that issuance of the full number of Warrant Shares requested in such Exercise Notice is permitted under this Section.  The Company’s obligation to issue shares of Common Stock in excess of the limitation referred to in this Section shall be suspended (and, except as provided below, shall not terminate or expire notwithstanding any contrary provisions hereof) until such time, if any, as such shares of Common Stock may be issued in compliance with such limitation;  provided , that, if, as of the Expiration Time, the Company has not received written notice that the shares of Common Stock may be issued in compliance with such limitation, the Company’s obligation to issue such shares shall terminate.  This provision shall not restrict the number of shares of Common Stock which a Holder may receive or beneficially own in order to determine the amount of securities or other consideration that such Holder may receive in the event of a Fundamental Transaction as contemplated in Section 9 of this Warrant.  This restriction may not be waived.

12.           No Fractional Shares. No fractional Warrant Shares will be issued in connection with any exercise of this Warrant. In lieu of any fractional shares that would otherwise be issuable, the Company shall pay cash equal to the product of such fraction multiplied by the closing price of one Warrant Share as reported by the applicable Trading Market on the Exercise Date.

13.           Notices. Any and all notices or other communications or deliveries hereunder (including, without limitation, any Exercise Notice) shall be in writing and shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number specified in this Section at or prior to 10:00 a.m. (New York City time) on a Trading Day, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via fax at the fax number specified in this Section on a day that is not a Trading Day or later than 10:00 a.m. (New York City time) on any Trading Day, (iii) the Trading Day following the date of mailing, if sent by nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. The addresses for such notices or communications shall be:  if to the Company, to Pluristem Therapeutics Inc., MATAM Advanced Technology Park, Building No. 20, Haifa, Israel, Attention: Chief Executive Officer, (Fax No.: +972-74-7107173) (or such other address as the Company shall indicate in writing in accordance with this Section) or (ii) if to the Holder, to the address or facsimile number appearing on the Warrant Register (or such other address as the Holder shall indicate in writing in accordance with this Section).

  

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14.           Warrant Agent. The Company shall serve as warrant agent under this Warrant. Upon thirty (30) days’ notice to the Holder, the Company may appoint a new warrant agent. Any corporation into which the Company or any new warrant agent may be merged or any corporation resulting from any consolidation to which the Company or any new warrant agent shall be a party or any corporation to which the Company or any new warrant agent transfers substantially all of its corporate trust or shareholders services business shall be a successor warrant agent under this Warrant without any further act. Any such successor warrant agent shall promptly cause notice of its succession as warrant agent to be mailed (by first class mail, postage prepaid) to the Holder at the Holder’s last address as shown on the Warrant Register.

15.           Miscellaneous.

(a)           This Warrant shall be binding on and inure to the benefit of the parties hereto and their respective successors and assigns. Subject to the preceding sentence, nothing in this Warrant shall be construed to give to any Person other than the Company and the Holder any legal or equitable right, remedy or cause of action under this Warrant. This Warrant may be amended only in writing signed by the Company and the Holder, or their successors and assigns.

(b)           All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of this Warrant and the transactions herein contemplated (“Proceedings”) (whether brought against a party hereto or its respective Affiliates, employees or agents) shall be commenced exclusively in the New York Courts. Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the New York Courts for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any Proceeding, any claim that it is not personally subject to the jurisdiction of any New York Court, or that such Proceeding has been commenced in an improper or inconvenient forum. Each party hereto hereby irrevocably waives personal service of process and consents to process being served in any such Proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Each party hereto hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Warrant or the transactions contemplated hereby. If either party shall commence a Proceeding to enforce any provisions of this Warrant, then the prevailing party in such Proceeding shall be reimbursed by the other party for its attorney’s fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Proceeding.

(c)           The headings herein are for convenience only, do not constitute a part of this Warrant and shall not be deemed to limit or affect any of the provisions hereof.

  

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(d)           In case any one or more of the provisions of this Warrant shall be invalid or unenforceable in any respect, the validity and enforceability of the remaining terms and provisions of this Warrant shall not in any way be affected or impaired thereby and the parties will attempt in good faith to agree upon a valid and enforceable provision which shall be a commercially reasonable substitute therefore, and upon so agreeing, shall incorporate such substitute provision in this Warrant.

(e)           Prior to exercise of this Warrant, the Holder hereof shall not, by reason of by being a Holder, be entitled to any rights of a stockholder with respect to the Warrant Shares.

  

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IN WITNESS WHEREOF, the Company has caused this Warrant to be duly executed by its authorized officer as of the date first indicated above.

	  	
PLURISTEM THERAPEUTICS INC.

	 
	  	  	 
	  	
By:

	
 

	 
	  	
Name:

	
Zami Aberman

	 
	  	
Title

	
Chief Executive Officer

	 

  

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PLURISTEM THERAPEUTICS INC.

EXERCISE NOTICE

WARRANT ORIGINALLY ISSUED _____________

WARRANT NO. _________

Ladies and Gentlemen:

(1)           The undersigned hereby elects to exercise the above-referenced Warrant with respect to shares of Common Stock.  Capitalized terms used herein and not otherwise defined herein have the respective meanings set forth in the Warrant.

(2)           The Holder intends that payment of the Exercise Price shall be made as (check one):

o           Cash Exercise under Section 10(a)

o           Cashless Exercise under Section 10(b)

(3)           If the Holder has elected a Cash Exercise, the holder shall pay the sum of $ ______________      to the Company in accordance with the terms of the Warrant.

(4)           Pursuant to this Exercise Notice, the Company shall deliver to the Holder the number of Warrant Shares determined in accordance with the terms of the Warrant.

(5)           By its delivery of this Exercise Notice, the undersigned represents and warrants to the Company that in giving effect to the exercise evidenced hereby the Holder will not beneficially own in excess of the number of shares of Common Stock (as determined in accordance with Section 13(d) of the Securities Exchange Act of 1934) permitted to be owned under Section 11 of this Warrant to which this notice relates.

 

	
Dated:

	  	  	
HOLDER:

	  	  	  
	  	  	
Print name ↑

	  	  	  
	  	  	
By:

	  
	  	  	  	  
	  	  	
Title:

	  

 

  

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PLURISTEM THERAPEUTICS INC.

WARRANT ORIGINALLY ISSUED __________

WARRANT NO. _________

FORM OF ASSIGNMENT

To be completed and signed only upon transfer of Warrant

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto _________________ the right represented by the within Warrant to purchase _________________ shares of Common Stock to which the within Warrant relates and appoints __________________ attorney to transfer said right on the books of the Company with full power of substitution in the premises.

	
Dated:

	  	  	
TRANSFEROR:

	  	  	  
	  	  	
Print name ↑

	  	  	  
	  	  	
By:

	  
	  	  	  	  
	  	  	
Title:

	  
	  	  	  	  
	  	  	  	  
	  	  	
TRANSFEREE:

	  	  	  
	  	  	
Print name ↑

	  	  	  
	  	  	
By:

	  
	  	  	  	  
	  	  	
Title:

	  
	
WITNESS:

	  	  	  
	  	  	
Address of Transferee:

	  	  	  	  
	
Print name ↑

	  	  
	  	  	  	  
	  	  	  

 

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