Document:

Mitel Networks Corporation

 

THIS WARRANT AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER
THE UNITED STATES SECURITIES ACT OF 1933 (THE “SECURITIES ACT”). THIS WARRANT MAY NOT BE EXERCISED
BY OR ON BEHALF OF ANY U.S. PERSON UNLESS REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM
SUCH REGISTRATION IS AVAILABLE.

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THE SECURITIES SHALL NOT TRADE THE
SECURITIES BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE LATER OF (i) APRIL 23, 2004, AND
(ii) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY.

SERIES 2 WARRANT CERTIFICATE

TO ACQUIRE COMMON SHARES OF

MITEL NETWORKS CORPORATION

THIS CERTIFIES that, for value received, EdgeStone Capital Equity Fund II Nominee, Inc.
(the “Holder”) as nominee for EDGESTONE CAPITAL EQUITY FUND II-A, L.P. and its parallel investors,
the registered holder of this common share purchase warrant certificate (the “Warrant
Certificate”), is entitled, subject to and conditional upon the exercise by Zarlink Semiconductor
Inc. (or its assignee(s)) of its put right pursuant to Section 6.6 of the Shareholders’ Agreement,
to purchase that number of Common Shares (the “Common Shares”) in the capital of Mitel Networks
Corporation (the “Corporation”) determined in accordance with Section 1.1 below at a price per
share of $0.00001 (as adjusted pursuant to the provisions hereof) (the “Exercise Price”) (the
“Warrant”).

Capitalized terms used herein have the meaning set forth in Section 5.1 of this Warrant
Certificate.

ARTICLE 1

EXERCISE OF WARRANT

1.1 Number of Common Shares Covered By Warrant

This Warrant Certificate shall represent the right to purchase that number of Common Shares (the
“Warrant Shares”) determined in accordance with the following formula:

	 	 	 	 	 
	A

	 	=
	 	((B/C)(D-E))
	 

	 	 	 	          F
	 
	 	 	 	 
	where
	 	 	 	 
	 
	 	 	 	 
	A

	 	=
	 	the aggregate number of Warrant Shares issuable on the exercise of this
Warrant

 

 

	 	 	 	 	 
	B

	 	=
	 	the aggregate number of Common
Shares that, on the Zarlink Put Date: (i) have been issued, or are issuable, on the conversion of the Series A Preferred
Shares issued to the Holder or any member of the EdgeStone Group; and (ii) have
been issued as result of the exercise of any Series 1 Warrant issued to the Holder
or any member of the EdgeStone Group
	 
	 	 	 	 
	C

	 	=
	 	the aggregate number of Common Shares outstanding on the Zarlink Put Date,
on an “as-if converted to Common Shares basis” (as determined in accordance with
Appendix 1 of the Shareholders’ Agreement)
	 
	 	 	 	 
	D

	 	=
	 	the aggregate purchase price of the Zarlink Purchased Securities (as such
term is defined in the Shareholders’ Agreement) pursuant to Section 6.6 of the
Shareholders’ Agreement
	 
	 	 	 	 
	E

	 	=
	 	the greater of: (i) the aggregate Fair Market Value of the Zarlink Purchased
Securities; and (ii) the number of Zarlink Purchased Securities multiplied by $1.00
(subject to appropriate adjustments for stock splits, stock dividends, consolidations
and other similar changes affecting the Common Shares)
	 
	 	 	 	 
	F

	 	=
	 	the Fair Market Value of one (1) Common Share

If “A” is negative as a result of the amount in “E” exceeding the amount in “D”, no Warrant Shares
will be issuable.

1.2 Automatic Exercise

Immediately prior to the consummation of the Exit Event, this Warrant shall automatically be
exercised for Warrant Shares and the Holder shall pay the Exercise Price in connection therewith,
provided, that, notwithstanding any other term or provision or this Warrant Certificate, such
exercise shall be deemed to have been effected at such earlier time as may be necessary to permit
the Holder to fully participate in the Exit Event as the registered holder of the Warrant Shares
on the books and records of the Corporation, and, without limiting the generality of the
foregoing, if a record date for any distribution to shareholders is established in connection with
any Liquidation Event or Change of Control Event that is an Exit Event, this Warrant shall be
deemed to have been automatically exercised for Warrant Shares on the date immediately prior to
such record date.

1.3 Exercise

The Corporation shall, on the date this Warrant is deemed to be automatically exercised in
accordance with Section 1.2 (the “Exercise Date”), and provided that payment in full of the
Exercise Price in respect of the exercise of this Warrant is received by the Corporation, issue
the Warrant Shares as fully paid and non-assessable Common Shares in the capital of the
Corporation.

 

 

1.4 Share Certificates

On the Exercise Date, upon the automatic exercise of this Warrant as provided above, the
Corporation shall issue and deliver to the Holder, or such Person as the Holder directs, a
certificate or certificates for the Warrant Shares.

1.5 Effect of Exercise

Upon the automatic exercise of this Warrant and the issuance of the Warrant Shares as
provided above, except as otherwise provided herein, the rights of the Holder with respect to this
Warrant which have been exercised shall cease, and the person or persons in whose name or names
any certificate or certificates for Warrant Shares shall then be issuable upon such exercise shall
be deemed to have become the holder or holders of record of the Warrant Shares represented
thereby.

1.6 Fractional Common Shares

No fractional Common Shares shall be issued upon exercise of this Warrant. If any
fractional interest in a Common Share would, except for the provisions of this Section 1.6, be
deliverable upon the exercise of this Warrant, the Corporation shall, in lieu of delivering the
fractional Common Shares therefor satisfy the right to receive such fractional interest by
rounding up the number of Common Shares to the nearest whole number.

1.7 Common Shares to be Reserved

The Corporation covenants and agrees that all Warrant Shares issuable upon the exercise of
this Warrant will, upon issuance, be duly authorized and issued, fully paid and non-assessable.

1.8 No Issuance Charge

The issuance of certificates for Warrant Shares upon the exercise of this Warrant shall be
made without charge to the Holder.

1.9 Replacement

Upon receipt of evidence satisfactory to the Corporation of the loss, theft, destruction or
mutilation of this Warrant Certificate and an indemnity in form and substance satisfactory to the
Corporation, the Corporation will issue to the Holder, at no charge to the Holder, a replacement
Warrant Certificate (containing the same terms and conditions as this Warrant Certificate).

ARTICLE 2

ADJUSTMENTS

2.1 Adjustment Events

If there is any change in the outstanding Common Shares whether by capital reorganization,
reclassification or otherwise, then the board of directors of the Corporation shall make an
adjustment in the number or kind of securities to be issued pursuant to the exercise of this
Warrant, the Exercise Price or the application of the other provisions of this Warrant
Certificate,

 

 

so as to protect the rights of the Holder in accordance with the essential intent and principle of
this Warrant Certificate. The adjustment shall be such as will give the Holder, upon exercise for
the same aggregate Exercise Price, the total number, class and kind of securities as it would have
owned had such Warrant been exercised prior to the event and had it continued to hold such shares
until after the event requiring adjustment.

2.2 Notice of Adjustment

Upon any adjustment of the number or kind of securities into which this Warrant is exercisable,
the Corporation shall give written notice thereof to the Holder, which notice shall state the
number of Common Shares or other securities subject to this Warrant resulting from such
adjustment, and shall set forth in reasonable detail the method of calculation and the facts upon
which such calculation is based. Upon the request of the Holder, there shall be transmitted
promptly to the Holder a statement of a firm of independent chartered accountants to the effect
that such firm concurs in the Corporation’s calculation of the change.

2.3 Disputes

If a dispute (other than with respect to any determination of the Fair Market Value pursuant to
the Shareholders’ Agreement or the articles of the Corporation as provided for herein) shall at
any time arise with respect to the number of Common Shares to which the Holder is entitled upon
exercise of this Warrant (by virtue of an adjustment contemplated by this Article 2 or otherwise),
such dispute shall be conclusively determined, at the expense of the Corporation, by such firm of
independent chartered accountants as may be mutually selected by the Holder and the Corporation.
Such independent chartered accountants shall have access to all necessary records of the
Corporation and such determination shall be binding upon the Corporation and the Holder.

ARTICLE 3

LIMITATION ON TRANSFER

3.1 Limitations on Transfer

This Warrant, the Warrant Shares or any interest therein or portion thereof shall be fully
transferable, in whole or in part, at any time and from time to time, subject to the terms and
conditions of the Shareholders’ Agreement.

3.2 Transfer Legend

Each certificate representing (i) this Warrant, (ii) the Warrant Shares, (iii) any other
securities issued in respect to the Warrant Shares, upon any stock split, stock dividend, capital
reorganization, merger, consolidation or similar event, shall (unless otherwise permitted by the
provisions of this Article 3 or unless such securities have been qualified for distribution and
resale under applicable securities laws) be stamped or otherwise imprinted with a legend
substantially in the following form (in addition to any legend required under any applicable
securities laws and pursuant to the Shareholders’ Agreement):

THIS WARRANT AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933

 

 

(THE “SECURITIES ACT”). THIS WARRANT MAY NOT BE EXERCISED BY OR ON BEHALF OF ANY U.S. PERSON
UNLESS REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

UNLESS PERMITTED UNDER SECURITIES LEGISLATION, THE HOLDER OF THE SECURITIES SHALL NOT TRADE THE
SECURITIES BEFORE THE DATE THAT IS 4 MONTHS AND A DAY AFTER THE LATER OF (i) APRIL 23, 2004, AND
(ii) THE DATE THE ISSUER BECAME A REPORTING ISSUER IN ANY PROVINCE OR TERRITORY.

ARTICLE 4

WARRANTIES AND COVENANTS

4.1 General Covenants, Responsibilities and Warranties of the Corporation

	 	(a)	 	The Corporation represents and warrants that it is duly authorized to enter into
and perform its obligations under this Warrant Certificate.
	 
	 	(b)	 	The Corporation covenants that it shall not, without the prior written approval
of the Holder, agree to any amendment, alteration or modification of Section 6.6 of
the Shareholders’ Agreement that adversely affects the rights or entitlements of
the Holder pursuant to this Warrant Certificate.
	 
	 	(c)	 	The Corporation shall at all times reserve and keep available
free from pre-emptive rights, out of the aggregate of its authorized unissued Common Shares,
for the purpose of enabling it to satisfy any obligation to issue Warrant Shares
upon exercise of this Warrant Certificate, the maximum number of Warrant
Shares deliverable upon the exercise thereof.
	 
	 	(d)	 	The Corporation covenants that all Warrant Shares which may be issued upon
exercise of this Warrant and payment therefor will, upon issue, be fully paid and
non-assessable.
	 
	 	(e)	 	In the event that the Common Shares are listed or quoted for trading on any
stock exchange or quotation system, the Corporation shall use its commercially
reasonable best efforts to cause all Warrant Shares issued upon exercise of this
Warrant Certificate to be listed for trading on each such exchange.
	 
	 	(f)	 	The Corporation represents and warrants that all necessary corporate actions
have been done and performed to create this Warrant and to make this Warrant and this
Warrant Certificate a legal, valid and binding obligation of the Corporation. The
Corporation will do, execute, acknowledge and deliver or cause to be done,
executed, acknowledged and delivered, all other acts, deeds and assurances in law
as may be reasonably required for the better accomplishing and effecting of the
intentions and provisions of this Warrant Certificate.
	 
	 	(g)	 	The Corporation will give written notice of the issue of the Warrant Shares
upon the exercise of this Warrant, in such detail as may be required, to each securities
commission or similar regulatory authority in each applicable jurisdiction in

 

 

	 	 	 	Canada in which there is legislation or regulations requiring the giving of any
such notice.

	 	(h)	 	The Corporation will direct its transfer agent to, or if the Corporation
serves as its own transfer agent, the Corporation shall, issue share certificates
representing the number of Warrant Shares issuable upon exercise of this Warrant, and
subject to adjustment as set forth herein, on the Exercise Date.
	 
	 	(i)	 	The Corporation represents and warrants that the issuance, execution and
delivery of this Warrant does not, and the issuance of the Warrant Shares upon the
exercise of this Warrant in accordance with the terms hereof will not, (i) violate or
contravene the Corporation’s articles, by-laws, or any law, statute, regulation, rule,
judgment or order applicable to the Corporation, (ii) violate, contravene or result in
a breach or default under any contract, agreement or instrument to which the
Corporation is a party or by which the Corporation or any of it assets are bound or
(iii) require the consent or approval of or the filing of any notice or registration
with any person or entity.

4.2 Payment of Taxes and Duties

The Corporation shall pay all expenses in connection with, and all taxes including all
applicable stamp, registration, bank transaction and other taxes (other than income tax and capital
gains tax exigible on the income of the Holder), if any, and all other taxes and other governmental
charges that may be properly imposed on the Corporation in respect of the issue or delivery of
Warrant Shares issuable upon the exercise of this Warrant, and shall indemnify and hold the Holder
or its affiliates harmless from any taxes, interest and penalties which may become payable by the
Holder or its affiliates as a result of the failure or delay by the Corporation to pay such taxes
specified above. For the purposes hereof, “Other Taxes” means any present or future stamp,
documentary or similar issue or transfer taxes or any other excise or property taxes, charges or
similar levies in respect of the issue or delivery of the Warrant Shares issuable upon exercise of
this Warrant.

4.3 Survival

The representations, warrants and covenants of the Corporation in Section 4.1 (a), (b), (e), (f),
(g), (h) and (i) and Section 4.2 shall survive the exercise of this Warrant and the issuance of
the Warrant Shares.

ARTICLE 5

RULES OF INTERPRETATION

5.1 Definitions

Whenever used in this Warrant Certificate, the following words and terms shall have the
meanings set out below:

“Business Day” means any day, other than a Saturday or Sunday, on which chartered banks in Ottawa,
Ontario, are open for commercial banking business during normal banking hours;

 

 

“Change of Control Event” has the meaning set out in the rights, privileges, restrictions and
conditions attaching to the Series A Preferred Shares in the articles of the Corporation;

“EdgeStone Put” means the exercise by EdgeStone or its assignee of its put right pursuant to
Section 6.9 of the Shareholders’ Agreement;

“Exit Event” means the first of the following events to occur after the exercise by Zarlink of its
put right pursuant to Section 6.6 of the Shareholders’ Agreement: (i) an Initial Public Offering;
(ii) a Liquidation Event; (iii) a Change of Control Event; (iv) an EdgeStone Put; and (v) a Series
A Redemption;

“Exit Valuation Date” means: (i) if the Exit Event is an Initial Public Offering, the date of the
closing of the Initial Public Offering; (ii) if the Exit Event is a Liquidation Event, the date
that the Corporation is liquidated, dissolved or wound-up; (iii) if the Exit Event is a Change of
Control Event, the date of the closing of the Change of Control Event; (iv) if the Exit Event is an
EdgeStone Put, the date that the Corporation is required pursuant to the Shareholders’ Agreement
(or would be required but for the failure by the Corporation to satisfy the solvency or liquidity
tests in Section 34 of the Canada Business Corporations Act (the “Act”)), to complete the
transaction of purchase and sale in respect of the EdgeStone Common Purchased Securities (as such
term is defined in the Shareholders’ Agreement); and (v) if the Exit Event is a Series A
Redemption, the date that the Corporation is required pursuant to the rights, privileges,
restrictions and conditions attaching to the Series A Preferred Shares in the articles of the
Corporation (or would be required but for the failure by the Corporation to satisfy the solvency or
liquidity tests in Section 36 of the Act), to redeem the Series A Preferred Shares;

“Fair Market Value” means the fair market value of one (1) Common Share on the Exit Valuation
Date, which shall for the purpose of this Warrant Certificate shall be deemed to be: (i) if the
Exit Event is an Initial Public Offering, the price to the public of the Common Shares sold by or
for the account of the Corporation pursuant to the Initial Public Offering; (ii) if the Exit Event
is a Liquidation Event, the amount payable in respect of each Common Share for the purpose of the
liquidation, dissolution or winding-up of the Corporation; (iii) if the Exit Event is a Change of
Control Event, the amount payable in respect of a Common Share upon the Change of Control Event;
(iv) if the Exit Event is an EdgeStone Put, the “Fair Market Value” of each Common Share as
determined in accordance with the Appendix 3 of the Shareholders’ Agreement; and (v) if the Exit
Event is a Series A Redemption, the “Fair Market Value” of each Common Share as determined in
accordance with Exhibit “1” of the rights, preferences, restrictions and conditions attaching to
the Series A Preferred Shares in the articles of the Corporation;

“Initial Public Offering” means the initial public offering of Common Shares or other securities
in the capital of the Corporation or the securities in the capital of any successor to the
Corporation or any other transaction, as a result of which (in either case) the shares of the
Corporation or any successor to the Corporation are listed and posted for trading, traded or
quoted on one or more of the Toronto Stock Exchange, the New York Stock Exchange, the NASDAQ
National Market System or other exchange or markets acceptable to the Holder (provided, that, any
filing of a registration statement or similar instrument with the SEC under the U.S. Securities
and Exchange Act in fulfillment of the Corporation’s existing obligations as a

 

 

foreign private issuer shall be deemed not to constitute an Initial Public Offering for the
purposes of this Warrant Certificate);

“Liquidation Event” has the meaning set out in the rights, privileges, restrictions and conditions
attaching to the Series A Preferred Shares in the articles of the Corporation;

“Series 1 Warrant” means the Series 1 Warrant issued by the Corporation pursuant to the Class A
Preferred Share Subscription Agreement dated as of the date hereof between the Holder and the
Corporation;

“Series A Preferred Shares” means the Class A Preferred Shares, Series 1 of the Corporation;

“Series A Redemption” means the redemption of the Series A Preferred Shares pursuant to Article 7
of the rights, privileges, restrictions and conditions attaching thereto in the articles of the
Corporation;

“Shareholders’ Agreement” means the shareholders’ agreement dated as of the date hereof among the
Corporation, the Holder and certain other parties, as the same may be amended from time to time;
and

“Zarlink Put Date” means the date that the Corporation is required pursuant to Section 6.6 of the
Shareholders’ Agreement (or would be required but for the failure by the Corporation to satisfy the
solvency or liquidity tests in Section 34 of the Act), to complete the transaction of purchase and
sale in respect of the Zarlink Purchased Securities (as such term is defined in the Shareholders’
Agreement).

5.2 Certain Rules of Interpretation

In this Warrant Certificate:

	 	(a)	 	Currency — Unless otherwise specified, all references to money amounts are to
lawful currency of Canada.
	 
	 	(b)	 	Governing Law — This Warrant Certificate is a contract made under and shall be
governed by and construed in accordance with the laws of the Province of Ontario
and the federal laws of Canada applicable in the Province of Ontario. Subject to
Section 2.3 and with respect to procedures for any determination of the Fair
Market Value pursuant to the Shareholders’ Agreement or the articles of the
Corporation as provided for herein, any action, suit or proceeding arising out of or
relating to this Warrant Certificate shall be brought in the courts of the Province
of Ontario and each of the Parties hereby irrevocably submits to the non-exclusive
jurisdiction of such courts.
	 
	 	(c)	 	Headings — Headings of Articles and Sections are inserted for convenience of
reference only and shall not affect the construction or interpretation of this
Warrant Certificate.

 

 

	 	(d)	 	Number and Gender — Unless the context otherwise requires, words importing
the singular include the plural and vice versa and words importing gender include
all genders.
	 
	 	(e)	 	Time — Time is of the essence in the performance of the parties’ respective
obligations under this Warrant Certificate.
	 
	 	(f)	 	Including — Where the word “including” or “includes” is used in this Warrant
Certificate, it means “including (or includes) without limitation”.
	 
	 	(g)	 	No Strict Construction — The language used in this Warrant Certificate is the
language chosen by the parties to express their mutual intent, and no rule of strict
construction shall be applied against any party.
	 
	 	(h)	 	Severability — If, in any jurisdiction, any provision of this Warrant
Certificate or its application to the Corporation or the Holder or circumstance is
restricted, prohibited or unenforceable, such provision shall, as to such
jurisdiction, be ineffective only to the extent of such restriction, prohibition or
unenforceability without invalidating the remaining provisions of this Warrant
Certificate and without affecting the validity or enforceability of such provision in
any other jurisdiction or without affecting its application to other of the Holder or
the Corporation, as the case may be, or the circumstances.

5.3 Language

The parties hereby confirm their express wish that this Warrant Certificate be drawn up in the
English language. Les parties reconnaissent leur volonté expresse que le présent certificat soit
rédigé en langue anglaise.

 

 

IN WITNESS WHEREOF the Corporation has caused this Warrant Certificate to be signed by a duly
authorized officer.

DATED this 23rd day of April, 2004.

	 	 	 	 	 
	 	MITEL NETWORKS CORPORATION 

 	 
	 	By:  	/s/ S. SPOONER
 	 
	 	 	Name : S. SPOONER 	 
	 	 	Title:  	C.F.O 	 
	 

[SIGNATURE PAGE TO SERIES 2 WARRANT CERTIFICATE]Mitel Networks Corporation

 

 

Mitel Networks Corporation

(the “Corporation”)

Common Share Purchase Warrant

	 	 	 
	Date of Issuance: April 29, 2004

	 	Holder: CIBC World Markets Inc.

THIS WARRANT AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933 (THE “SECURITIES ACT”). THIS WARRANT MAY NOT BE EXERCISED
BY OR ON BEHALF OF ANY U.S. PERSON UNLESS REGISTERED UNDER THE SECURITIES ACT OR AN EXEMPTION FROM
SUCH REGISTRATION IS AVAILABLE.

UNLESS PERMITTED UNDER SECURITIES LEGISLATION THE HOLDER OF THIS SECURITY MUST NOT TRADE THE
SECURITY BEFORE THE DATE THAT IS FOUR (4) MONTHS AND A DAY AFTER THE LATER OF (I) THE DATE HEREOF
AND (II) THE DATE MITEL NETWORKS CORPORATION BECAME A REPORTING ISSUER IN ANY PROVINCE OR
TERRITORY.

1. THIS WARRANT HEREBY ENTITLES the Holder to purchase, subject to the terms and
conditions herein, up to ONE MILLION (1,000,000) fully paid and non-assessable Common Shares
(the “Shares”) in the capital of the Corporation at a price of ONE DOLLAR ($1.00 Cdn) per
Share (the “Exercise Price”).

2. Exercise and Expiry. This Warrant may be exercised in whole or in part at any time and from
time to time after the date hereof until the earlier of:

(a) immediately prior to a Liquidity Event (as defined below); or

(b) April 28, 2009,

(the “Expiry Date”).

The number of Shares which may be purchased pursuant to this Warrant and the Exercise Price
therefor shall be adjusted in the events and manner specified in this Warrant.

3. Liquidity Event. For the purpose of this Warrant, a Liquidity Event means:

	 	(a)	 	the initial public offering of Common Shares or other securities in
the capital of the Corporation or the securities in the capital of any successor
to the Corporation or any other transaction, as a result of which (in either case)
the shares of the Corporation or any successor to the Corporation are listed and
posted for trading, traded or quoted on one or more of the Toronto Stock Exchange,
the New York Stock Exchange, the NASDAQ National Market System or other exchange
or markets acceptable to the Holder (provided, that, any filing of a registration
statement or similar instrument with the Securities and Exchange Commission under
the U.S. Securities and Exchange Act in fulfillment of the Corporation’s existing
obligations as a foreign private issuer shall be deemed not to constitute a Public
Offering for the purposes of this Warrant) (a “Public Offering”);
	 
	 	(b)	 	(A) an amalgamation of the Corporation with another corporation
(other than with a

	 	 	 
	Form of Warrant

	 	1

 

 

	 	 	 	subsidiary of the Corporation), (B) a statutory arrangement
involving the Corporation, (C) the sale, exchange or other disposition of
outstanding shares of the Corporation, or (D) any other transaction involving the
Corporation (other than a public offering of securities of the Corporation),
whether by a single transaction or series of transactions, pursuant to which, in
the case of (A), (B), (C) or (D) above, any person, together with his or its
Affiliates (as defined below) (other than members of the Matthews Group (as
defined below)), hereafter acquires the direct or indirect “beneficial ownership”
(as defined in the Canada Business Corporations Act) of securities of the
Corporation representing more than 50% of the issued and outstanding voting
securities in the capital of the Corporation; or
	 
	 	(c)	 	the sale, lease, exclusive and irrevocable licence, abandonment,
transfer or other disposition of all or substantially all of the assets of the
Corporation to a person other than a person that is an Affiliate of the
Corporation.

For purposes of this Section 3, the following capitalized terms have the following meanings:

“Affiliate” means of a person means any person that would be considered to be an
“affiliated entity” of such first-mentioned person under Ontario Securities Commission
Rule 45-501 — Exempt Distributions; and

“Matthews Group” means:

	 	(i)	 	Dr. Terence H. Matthews, his spouse or former spouse, any
lineal descendant of Dr. Terence H. Matthews, any spouse or former spouse of
any such lineal descendant, and their respective legal personal
representatives;
	 
	 	(ii)	 	the trustee or trustees of any trust (including without
limitation a testamentary trust) for the exclusive benefit of any one or more
members of the Matthews Group;
	 
	 	(iii)	 	any corporation all of the issued and outstanding shares of
which are beneficially owned by any one or more members of the Matthews Group;
	 
	 	(iv)	 	any partnership all of the partnership interests in which are
beneficially owned by any one or more members of the Matthews Group; and
	 
	 	(v)	 	any charitable foundation controlled by any one or more members
of the Matthews Group,

and, for this purpose, a trustee or trustees referred to in clause (ii) above shall
be deemed to beneficially own any shares or partnership interests held by them.

4. Method of Exercise. This Warrant may be exercised by the Holder prior to 5:00 p.m. (Ottawa
time) on the Expiry Date by surrendering this Warrant to the Corporation at its office at 350
Legget Drive, Ottawa, Ontario, or at such other place as may be designated by the Corporation,
together with the notice of exercise (“Notice of Exercise”) in the form attached hereto as
Appendix “A”, setting forth the number of Shares for which it is being exercised, the name or
names in which certificates are to be issued, and the number of Shares which are to be issued in each name, accompanied or preceded by payment to
the Corporation, by cash, certified cheque or wire transfer of immediately available
funds, of the Exercise Price multiplied by the number of Shares being purchased.

	 	 	 
	Form of Warrant

	 	2

 

 

5. Issuance of Shares. Upon surrender of this Warrant and payment, the Corporation will issue to
the Holder the number of Shares subscribed for and the Holder will be a shareholder of the
Corporation in respect of such Shares at the date of surrender and payment. Shares issued upon
exercise of this Warrant will be fully paid, non-assessable, and free from all taxes, liens
and charges. No fractional Shares shall be issued as a result of the exercise of this Warrant.
Should the exercise of this Warrant result in a fractional number of Shares being issuable to
the Holder, the next higher whole number of Shares shall be issued to the Holder. While this
Warrant is exercisable, the Corporation shall keep enough Shares authorized and reserved to
satisfy the exercise of this Warrant. As soon as practicable after surrender and payment the
Corporation will deliver to the Holder at the address or addresses specified in the Notice of
Exercise a certificate or certificates evidencing the Shares subscribed for and to the extent
necessary issue to the Holder a replacement Warrant Certificate on identical terms in respect
of the number of Shares in respect of which the Holder has not exercised the rights evidenced
hereunder which shall have effect from the date hereof, not from the date of such partial
exercise.

6. Replacement Warrant Certificate. If this Warrant is stolen, lost, mutilated or destroyed the
Corporation may, on such reasonable terms as to indemnity or otherwise as it may in its
discretion impose, issue a new share purchase warrant certificate of like denomination, tenor
and date as this Warrant so stolen, lost, mutilated or destroyed.

7. Adjustment of Exercise Price and Number of Shares. The Exercise Price and/or the number of
Shares issuable upon exercise of this Warrant, as the case may be, shall be adjusted from time
to time upon the occurrence of each of the following events:

	 	(a)	 	In the event of any subdivision or change or subdivisions or changes
of the Shares at any time while this Warrant is outstanding into a greater number
of Shares, the Corporation shall thereafter deliver, and the Holder shall accept,
at the time of any subsequent purchase of Shares as a result of the exercise of
the right to purchase under this Warrant, in lieu of the number of Shares in
respect of which the right to purchase is then being exercised, such greater
number of Shares as would result from said subdivision or change or subdivisions
or changes had the right of purchase been exercised before such subdivision or
change or subdivision or changes and the Corporation shall adjust the Exercise
Price by multiplying the Exercise Price in effect on the day preceding the
effective date of such subdivision or change by a fraction, the numerator of which
is the number of Shares outstanding prior to the effective date of such
subdivision or change and the denominator of which is the total number of Shares
outstanding immediately after such effective date.
	 
	 	(b)	 	In the event of any consolidation or consolidations of the Shares at
any time while this Warrant is outstanding into a lesser number of Shares, the
Corporation shall thereafter deliver, and the Holder shall accept, at the time of
any subsequent purchase of Shares as a result of the exercise of the right to
purchase under this Warrant, in lieu of the number of Shares in respect of which
the right to purchase is then being exercised, such lesser number of Shares of the
Corporation as would result from such consolidation or consolidations had the
right of purchase been exercised before such consolidation or consolidations and
the Corporation shall adjust the Exercise Price by multiplying the
Exercise Price in effect on the day preceding the effective date of such
consolidation by a fraction, the numerator of which is the number of Shares
outstanding prior to the effective date of such consolidation and the denominator
of which is the total number of Shares outstanding immediately after such effective
date.
	 
	 	(c)	 	In the event of any reclassification or reclassifications of the
Shares at any time while this

	 	 	 
	Form of Warrant

	 	3

 

 

	 	 	 	Warrant is outstanding, the Corporation shall
thereafter deliver, and the Holder shall accept, at the time of any subsequent
purchase of Shares as a result of the exercise of the right to purchase under this
Warrant, the number of shares of the Corporation of the appropriate class or
classes resulting from said reclassification or reclassifications as the Holder
would have been entitled to receive in respect of the number of Shares in respect
of which the right of purchase is then being exercised had the right of purchase
been exercised before such reclassification or reclassifications.
	 
	 	(d)	 	On the happening of each and every event referred to in the preceding
three paragraphs (each an “Adjustment Event”) the applicable provisions of this
Warrant shall, ipso facto, be deemed to be amended accordingly and the Corporation
shall take all necessary action so as to comply with such provisions as so
amended.
	 
	 	(e)	 	The Adjustment Events are to be cumulative. If and whenever an
adjustment event occurs, the Corporation shall forthwith deliver to the Holder a
certificate of the Corporation setting forth the details of the action taken and
the adjusted number of Shares and/or securities, evidences of indebtedness or
property issuable upon the exercise of this Warrant and the details of the
calculation of such adjustment.

8. Notice of Certain Events

	 	(a)	 	If the Corporation, at any time while this Warrant is outstanding,
shall distribute to all or substantially all the holders of Shares any securities,
evidence of indebtedness or property (excluding dividends paid in the ordinary
course) to holders of Shares, the Corporation shall provide the Holder of this
Warrant with not less than twenty (20) days notice in writing of such distribution
to permit such Holder to exercise the rights herein provided.
	 
	 	(b)	 	If and whenever at any time while this Warrant is outstanding, there
is proposed an event or transaction or series of transactions which would
constitute a Liquidity Event, the Corporation shall provide the Holder not less
than twenty (20) days notice in writing of such event together with sufficient
information concerning such event or transaction as to allow the Holder to make an
informed decision in respect to the exercise of rights herein.

9. Binding Obligation. The Corporation represents and warrants and agrees that it is duly
authorized to create and issue this Warrant and the Shares to be issued hereunder and that
this Warrant when signed by the Corporation as herein provided will be a valid and enforceable
obligation of the Corporation in accordance with the provisions hereof and that, subject to
the provisions hereof, it will cause the Shares from time to time subscribed for and purchased
in the manner herein provided, and the certificates evidencing such Shares, to be duly issued.

10. Compliance with Securities Laws. Each certificate for Shares issued upon exercise of this
Warrant or to a subsequent transferee shall (unless not required under applicable law) bear
the legend set out at the top of the first page of this Warrant.

11. Non-Assignable. This Warrant is non-assignable and non-transferable and may not be exercised
by or for the benefit of any person other than the Holder.

12. Miscellaneous.

	 	(a)	 	Time shall be of the essence.

	 	 	 
	Form of Warrant

	 	4

 

 

	 	(b)	 	This Warrant shall be governed by and construed in accordance with
the laws of the Province of Ontario and the federal laws of Canada applicable
therein.
	 
	 	(c)	 	This Warrant shall not be valid for any purpose whatever until it has
been signed by the Corporation.

In Witness Whereof the Corporation has caused this Warrant to be executed as of the
date first above written.

	 	 	 	 	 	 	 
	 	 	Mitel Networks Corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	Per:	 	 	 	 
	 

	 	 	 	 

     Name:
	 	 
	 

	 	 	 	     Title:	 	 

	 	 	 
	Form of Warrant

	 	5

 

 

SCHEDULE “A”

NOTICE OF EXERCISE

TO: Mitel Networks Corporation (the “Corporation”)

          The undersigned Holder of the within Warrant dated as of April ·, 2004 (the “Warrant”)
hereby subscribes for                                         Common Shares (the “Shares”) in the capital of the Corporation at an Exercise
Price, as adjusted, if necessary, in accordance with the terms of the Warrant, of $                                         per
Share for a total purchase price of $                                        . The undersigned Holder, along with the delivery of this
Notice, hereby delivers cash or a certified cheque, or by electronic wire transfer, full payment
for the Shares.

          The undersigned Holder hereby directs that the Shares hereby subscribed for be issued and
delivered as follows:

Name in Full                Address in Full                Number of Shares

          Dated as of this                     day of                                         .

	 	 	 	 	 
	 

	 	Holder:	 	 
	 
	 
	 

	 	 

Authorized Signatory
	 	 
	 

	 	Name:	 	 

	 	 	 
	Form of Warrant

	 	Schedule A

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