6-K
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
6-K
REPORT
OF
FOREIGN ISSUER
Pursuant
to Rule 13a-16 or 15d-16 of
the
Securities Exchange Act of 1934
For
the month of May 2007
Commission
File Number 000-51122
pSivida
Limited
(Translation
of registrant’s name into English)
Level
12
BGC Centre
28
The
Esplanade
Perth
WA
6000
(Address
of principal executive offices)
(Indicate
by check mark whether the registrant files or will file annual reports under
cover Form 20-F or Form 40-F).
Form
20-F
ý Form
40-F o
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1):
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7):
Indicate
by check mark whether the registrant by furnishing the information contained
in
this Form is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes
o No
ý
If
"Yes"
is marked, indicate below the file number assigned to the registrant in
connection with Rule 12g3-2(b): 82- ___.
The
documents attached as Exhibit 99.1, Exhibit 99.2, Exhibit
99.3, Exhibit 99.4, Exhibit 99.5, Exhibit
99.6 and Exhibit 99.7 to this Report on Form 6-K are hereby incorporated by reference
herein and into the following registration statements: (i)
the Registrant's Registration Statement on Form F-3, Registration
No. 333-132776; (ii) the Registrant's Registration Statement on
Form F-3, Registration No. 333-132777; (iii) the Registrant's
Registration Statement on Form F-3, Registration No. 333-135428; (iv)
the Registrant's Registration Statement on Form F-3, Registration
No. 333-141083; and (v) the Registrant's Registration Statement on
Form F-3, Registration No. 333-141091.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant,
pSivida Limited, has duly caused this report to be signed on its behalf by
the
undersigned, thereunto duly authorized.
Date:
May
16, 2007
pSivida
Limited
Michael
J. Soja
Vice
President of Finance and Chief Financial Officer
EXHIBIT
INDEX
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Supplemental
disclosure of pSivida Limited, related to the Amended and Restated
Second
Amendment Agreement, dated May 15, 2007
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Amended
and Restated Second Amendment Agreement dated May 15,
2007
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Second
Amended and Restated Registration Rights Agreement
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Series
D Warrants
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Series
E Warrants
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Series
F Warrants
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Series
G Warrants
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EX 99.1
EXHIBIT
99.1
SUPPLEMENTAL
DISCLOSURE OF PSIVIDA LIMITED, DATED MAY 15, 2007, RELATED TO THE AMENDED AND
RESTATED SECOND AMENDMENT AGREEMENT, DATED AS OF MAY 15,
2007.
THIS
SUPPLEMENTAL DISCLOSURE SHALL NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY ANY SECURITIES DESCRIBED HEREIN.
THE
SECURITIES DESCRIBED HEREIN HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF
1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE OFFERED OR SOLD IN THE
UNITED STATES ABSENT REGISTRATION OR AN APPLICABLE EXEMPTION FROM REGISTRATION
REQUIREMENTS.
IN
ACCORDANCE WITH GENERAL INSTRUCTION B OF FORM 6-K, THE INFORMATION SET FORTH
IN
THIS SUPPLEMENTAL DISCLOSURE SHALL NOT BE DEEMED TO BE “FILED” FOR PURPOSES OF
SECTION 18 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE “EXCHANGE
ACT”), OR OTHERWISE SUBJECT TO THE LIABILITIES OF THAT SECTION, NOR SHALL SUCH
INFORMATION BE DEEMED INCORPORATED BY REFERENCE IN ANY FILING UNDER THE
SECURITIES ACT OR THE EXCHANGE ACT, EXCEPT AS SHALL BE EXPRESSLY SET FORTH
BY
SPECIFIC REFERENCE IN SUCH A FILING. THE INFORMATION SET FORTH IN THIS
SUPPLEMENTAL DISCLOSURE SHALL NOT BE DEEMED AN ADMISSION AS TO THE MATERIALITY
OF ANY INFORMATION IN THIS SUPPLEMENTAL DISCLOSURE.
The
following is a summary of the terms of the transactions contemplated by the
Amended and Restated Second Amendment Agreement. This summary is not intended
to
be complete and is qualified in its entirety by reference to the attachments
to
this Supplemental Disclosure.
pSivida
Limited (“pSivida”) and an institutional investor (the “Investor”) entered into
an Amended and Restated Second Amendment Agreement dated as of May 15, 2007
(the
“Second Amendment Agreement”), providing for, among other things, the redemption
of the Amended and Restated Subordinated Convertible Note, dated November 16,
2005 (the “Existing Notes”), purchased in connection with the Securities
Purchase Agreement, dated October 5, 2005, by and between the same parties.
Capitalized terms used herein and not otherwise defined herein shall have the
respective meanings ascribed to them in the Second Amendment Agreement and,
if
not defined therein, the Existing Notes.
Under
the
Second Amendment Agreement, pSivida will redeem the Existing Notes and issue:
(i) the Series D Warrants which shall be exercisable at $2.00 per ADS to
purchase Four Million (4,000,000) ADSs, (ii) the Series E Warrants which shall
be exercisable at $1.57 per ADS to purchase Four Million (4,000,000) ADSs,
(iii)
the Series F Warrants which shall be exercisable at $1.95 per ADS to purchase
One Million (1,000,000) ADSs and (iv) the Series G Warrants which shall be
exercisable at $1.21 per ADS to purchase Two Million Three Hundred Forty One
Thousand Three Hundred Forty Seven (2,341,347) ADSs and amend and restate the
existing registration rights agreement, and waive any penalties incurred as
a
result of the delay in effectiveness of the registration statement filed in
connection with the existing Registration Rights Agreement.
Under
the
Second Amendment Agreement, the Investor has agreed to surrender the Existing
Notes to pSivida, terminate and waive all rights associated with (i) the
security interest granted by pSivida on the Collateral for the benefit of the
holders of the Existing Notes, (ii) the Guaranty by pSivida in favor of the
Investor, and (iii) the Subordination Agreements. In addition, the Interest
Payment Amount shall be deemed paid in full to the Investor, the Investor shall
waive all defaults and Events of Default under the Existing Notes and
Transaction Documents and shall release pSivida from all obligations under
the
Existing Notes.
The
Second Amendment Agreement is furnished on the Form 6-K to which this
Supplemental Disclosure is also an Exhibit.. The Second Amendment Agreement
contains representations and warranties that pSivida and
the Investor made to each other as of the date of the Second Amendment Agreement
or other specific dates, and such representations and warranties should not
be
relied upon by any other person.
The
following is a summary of the terms of the warrants:
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The
warrants constitute options to acquire ADSs at any time on or before
the
fifth anniversary of the issuance of the
warrant.
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The
per ADS exercise price under the warrant may be adjusted under certain
circumstances, including, among others, in the event pSivida issues
securities at a lower price than the price at which the warrant may
be
exercised or pSivida makes a pro rata issuance to shareholders.
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·
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There
is a limit of 4.99% in respect of the Investor and its affiliates’
beneficial ownership in pSivida, which may prevent it from exercising
part
of the warrant (this limit may be increased or decreased by the Investor
upon written notice to pSivida).
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·
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If
there is a fundamental transaction (such as a transaction which involves
a
change in control of pSivida or a transfer of substantially all of
its
assets), pSivida will use its best endeavors to procure that the
successor
entity assumes all of the obligations of pSivida under the
warrant.
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The
Series D, Series E, Series F and Series G Warrants are furnished on the
Form 6-K to which this Supplemental Disclosure is also an
Exhibit.
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Second
Amended and Restated Registration Rights
Agreement:
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Under
the Second Amended and Restated Registration Rights Agreement, pSivida
has
agreed to register the ordinary shares underlying the Series A Warrant
Shares, the Series C Warrant Shares, the Series D Warrant Shares,
the
Series E Warrant Shares, the Series F Warrant Shares, the Series
G Warrant
Shares and any shares of capital stock issued or issuable with respect
to
the Series A Warrant Shares, the Series C Warrant Shares, the Series
D
Warrant Shares, the Series E Warrant Shares or the Series F Warrant
Shares
or the Series G Warrant Shares
as
a result of any stock split, stock dividend, recapitalization, exchange
or
similar event or otherwise.
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The
Second Amended and Restated Registration Rights Agreement is furnished on the
Form 6-K to which this Supplemental Disclosure is also an
Exhibit.
EX 99.2
EXHIBIT
99.2
AMENDED
AND RESTATED
SECOND
AMENDMENT AGREEMENT
AMENDED
AND RESTATED SECOND AMENDMENT AGREEMENT
(the
"Agreement"),
dated
as of May 15, 2007, by and among pSivida Limited, an Australian corporation,
with headquarters located at Level 12, BGC Centre, 28 The Esplanade, Perth,
WA
6000 Australia (the "Company"),
and
Castlerigg Master Investments Ltd. (the "Investor").
WHEREAS:
A.
The
Company and the Investor are parties to that certain Securities Purchase
Agreement, dated as of October 5, 2005 (as amended prior to the date hereof,
the
"Existing
Securities Purchase Agreement"),
pursuant to which, among other things, the Investor purchased from the Company
(i) subordinated convertible notes, dated November 16, 2005 (the
"Original
Notes"),
which
are convertible in accordance with their terms into American Depositary Shares
of the Company ("ADSs")
each
of which represents 10 ordinary shares of the Company (the "Ordinary
Shares")
and is
evidenced by an American Depository Receipt ("ADR")
and
(ii) warrants (the "Original
Warrants"),
which
are exercisable to purchase 633,803 ADSs (the "Original
Warrant Shares").
B.
On
November 16, 2005, the Company and the Investor entered into a Registration
Rights Agreement (the "Original
Registration Rights Agreement"),
pursuant to which the Company agreed to provide certain registration rights
with
respect to the Registrable Securities (as defined in the Original Registration
Rights Agreement) under the Securities Act of 1933, as amended (the
"1933
Act"),
and
the rules and regulations promulgated thereunder, and applicable state
securities laws.
C.
The
Company and the Investor are also parties to that certain Amendment Agreement,
dated as of July 28, 2006 (the "Amendment
Agreement"),
pursuant to which, among other things, on September 14, 2006, (i) the Company
paid to the Investor the Amendment Payment Amount (as defined in the Amendment
Agreement); (ii) the Company issued to the Investor amended and restated notes
(the "Existing
Notes"),
convertible into ADSs, in accordance with the terms thereof; (iii) the Company
issued to the Investor Series A Warrants (the "Series
A Warrants")
exercisable to purchase 5,700,000 ADSs (the "Series
A Warrant Shares"),
in
accordance with the terms thereof; (iv) the Company agreed to issue to the
Investor warrants exercisable to purchase ADSs (the "Series
B Warrants")
from
time to time in accordance with the terms of the Existing Notes; (v) the Company
and the Investor entered into the Amended and Restated Registration Rights
Agreement (the "Existing
Registration Rights Agreement"),
pursuant to which the Company has agreed to provide certain registration rights
with respect to the Registrable Securities (as defined in the Existing
Registration Rights Agreement) under the 1933 Act, and the rules and regulations
promulgated thereunder, and applicable state securities laws; (vi) the Company
redeemed $2.5 million in principal amount of the Original
Notes.
D.
In
connection with that certain Letter Agreement, by and between the Company and
the Investor, dated October 17, 2006 (the "Letter
Agreement"),
the
Company agreed to make certain payments to the Investor, and the Company and
the
Investor agreed (i) to amend certain of the provisions of the Existing
Registration Rights Agreement in connection with the Registration Statement
on
Form F-3 (SEC File No. 333 132777) registering 12,737,139 ADSs issuable to
the
Investor
and (ii)
to pay the Investor US$800,000 pursuant to Section 3(a) of the Letter Agreement
(the "Letter
Agreement Payment Amount");
E.
As
of
December 29, 2006, the Company and the Investor entered into the Second
Amendment Agreement, pursuant to which, among other things (i) the Company
and
the Investor agreed to amend and restate the Existing Notes; (ii) the
Company issued Series C Warrants in the form attached hereto as Exhibit
B
(the
"Series
C Warrants"
and
together with the Original Warrants and the Series A Warrants, the "Existing
Warrants")
exercisable to purchase One Million and Five Hundred Thousand (1,500,000) ADSs
(the "Series
C Warrant Shares",
and
collectively with the Original Warrant Shares and the Series A Warrant Shares,
the "Existing
Warrant Shares"),
in
accordance with the terms thereof; (iii) the Company agreed to issue Series
D
Warrants in the form attached hereto as Exhibit
C
(the
"Series
D Warrants")
exercisable to purchase Four Million (4,000,000) ADSs (the "Series
D Warrant Shares")
for
US$2.00 per ADS; (iv) the parties agreed to further amend and restate the
Existing Registration Rights Agreement and (v) the Company agreed to increase
the principal amount of the Existing Notes by $306,391 (the "Note
Increase Amount"),
which
shall constitute payment in full to the Investor of any accrued and unpaid
interest on the Existing Notes of the Investor, which was payable on or prior
to
January 2, 2007 under the terms of the Existing Notes to the Investor (the
"Interest
Payment Amount").
F.
The
Company and the Investor now desire to amend and restate in its entirety the
Second Amendment Agreement to reflect the terms of the parties binding letter
of
intent, dated April 2, 2007 and other agreements between them, pursuant to
which, among other things, (i) the Company shall redeem the Existing Notes
as
set forth herein; (ii) the Company shall issue, upon the terms and
conditions stated in this Agreement, the Series D Warrants which shall be
exercisable to purchase the Series D Warrant Shares, (iii) the Company
shall issue, upon the terms and conditions stated in this Agreement, the Series
E Warrants (the "Series E
Warrants")
which
shall be exercisable to purchase Four Million (4,000,000) ADSs (the
"Series E
Warrant Shares")
for
US$1.57 per ADS, the Series F Warrants (the "Series
F Warrants")
which
shall be exercisable to purchase One Million (1,000,000) ADSs (the "Series
F Warrant Shares")
for
US$1.95 per ADS and the Series G Warrants (the "Series
G Warrants"
and
together with the Series D Warrants, the Series E Warrants and the Series F
Warrants, the "New
Warrants")
which
shall be exercisable to purchase Two Million Three Hundred Forty One Thousand
Three Hundred Forty Seven (2,341,347) ADSs (the "Series
G Warrant Shares"
and
together with the Series D Warrant Shares, the Series E Warrant Shares and
the
Series F Warrant Shares, the "New
Warrant Shares")
for
US$1.21 per ADS, in each case, in the form attached hereto as Exhibit C
in
accordance with the terms thereof; (iv) the parties hereto will further
amend and restate the Existing Registration Rights Agreement in the form
attached hereto as Exhibit
D
(the
"Second Amended
and Restated Registration Rights Agreement");
and
(v) the Investor shall waive all prior and existing defaults and Event of
Default and other rights.
G.
The
issuance of the Series C Warrants was, and the issuance of the Series D
Warrants, the Series E Warrants, the Series F Warrants and the Series G Warrants
is being, made in reliance upon an exemption from registration under the 1933
Act.
H.
Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings ascribed to them in the Amended Securities Purchase Agreement (as
defined below) and, if not defined therein, the Existing Notes.
NOW,
THEREFORE,
in
consideration of the foregoing recitals and the mutual promises hereinafter
set
forth, the Company and the Investor hereby agree as follows:
1.
CLOSING.
At
the
closing contemplated by this Agreement (the "Closing"):
(a)
Warrants.
The
Company shall issue and deliver to the Investor the Series D Warrants, the
Series E Warrants,
the Series F Warrants and the Series G Warrants;
(b)
Redemption
of the Existing Notes.
Notwithstanding
Section 10 of the Existing Notes and the Company Optional Redemption Date
specified in the Company’s Company Optional Redemption Notice issued to the
Investor on April 3, 2007 or any other provision in the Existing Notes or the
Transaction Documents to the contrary, the Company shall, and the Investor
shall
permit the Company to, redeem all of the Existing Notes by making the following
payment to the Investor in satisfaction of the Company Optional Redemption
Price
(collectively, the “Redemption
Payment”):
(i) the
Company Optional Redemption Price, computed in accordance with the terms of
the
Existing Notes;
(ii) the
Note
Increase Amount; and
(iii) the
difference between (A) US$13,750,000 and (B) the sum of (i) and
(ii).
(c)
Surrender
of Existing Notes.
The
Investor shall surrender the Existing Notes to the Company;
(d)
Waivers
and Release.
Effective upon the Closing and payment of the Redemption Payment:
(1) (A) The
security interest granted by the Company on the Collateral for the benefit
of
the holders of the Existing Notes in accordance with the terms of the Security
Documents, (B) the Guaranty by pSivida Inc. in favor of the Investor (the
“Guaranty”),
and
(C) the Subordination Agreements by and among the Investor, the Company and
the
holders of the Company’s
subordinated convertible notes issued on September 26, 2006 (the
“Subordination
Agreements”)
shall
each be terminated; the Investor hereby waives any and all rights pursuant
to
each of them; and the Investor shall take any action required pursuant to the
terms of the Security Documents, the Guaranty and the Subordination Agreements
to release any and all
security
interests on the Collateral and terminate the Guaranty and the Subordination
Agreements;
(2) The
Interest Payment Amount shall be deemed paid in full to the Investor; and
(3) (A) The
Existing Notes shall be deemed fully redeemed; (B) the Investor shall be
deemed to have permanently and irrevocably waived all defaults and Events of
Default (including any conditions with respect to which the giving of notice
or
passage of time would lead to a default of an Event of Default) under:
(I) the Existing Notes and (II) the Transaction Documents (including,
without limitation, the waivers described in Section 2 hereof), in each
case, up to and including the Closing Date; and (C) the Company shall have
no further obligations under the Existing Notes (including, without limitation,
any obligation to issue Series B Warrants in connection with the redemption
of
the Existing Notes or otherwise).
(e)
Ratifications.
Except
as otherwise expressly provided herein, (i) the Existing Securities
Purchase Agreement as amended hereby (the "Amended
Securities Purchase Agreement"),
the
Existing Warrants and the Irrevocable Transfer Agent Instructions are, and
shall
continue to be, in full force and effect and are hereby ratified and confirmed
in all respects, except that on and after the Closing Date (A) all references
in
the Existing Securities Purchase Agreement to "this Agreement", "hereto",
"hereof", "hereunder" or words of like import referring to the Existing
Securities Purchase Agreement shall mean the Amended Securities Purchase
Agreement, (B) all references in the Transaction Documents to "this Agreement",
"hereto", "hereof", "hereunder" or words of like import referring to the
Existing Registration Rights Agreement or the Original Registration Rights
Agreement shall mean the Second Amended and Restated Registration Rights
Agreement, (C) all references in the other Transaction Documents to the
"Registration Rights Agreement", "Amended and Restated Registration Rights
Agreement", "thereto", "thereof", "thereunder" or words of like import referring
to the Existing Registration Rights Agreement or Original Registration Rights
Agreement shall mean the Second Amended and Restated Registration Rights
Agreement, (D) all references in the Securities Purchase Agreement and the
other Transaction Documents to "Transaction Documents" shall also include this
Agreement and the New Warrants, (E) all references in the Securities Purchase
Agreement and the other Transaction Documents to "Notes" or "Amended and
Restated Notes" shall continue to mean the Existing Notes, (F) all
references in the existing Securities Purchase Agreement and the other
Transaction Documents to "Warrants" shall be amended to include the New
Warrants, and (G) all references in the Securities Purchase Agreement and the
other Transaction Documents to "Warrant Shares" shall be amended to include
the
New Warrant Shares in addition to the Existing Warrant Shares, and (ii) except
as expressly stated herein or as is otherwise necessary in the context of the
terms and conditions hereof, the execution, delivery and effectiveness of this
Agreement shall not operate as an amendment of any right, power or remedy of
the
Investor under any Transaction Document, nor constitute an amendment of any
provision of any Transaction Document.
(f)
Closing
Date.
The
date and time of the Closing (the "Closing
Date")
shall
be as of 1:00 p.m., New York Time, on the date of this Agreement, or as of
such
time and date as otherwise mutually agreed by the parties. The Closing shall
be
deemed to have
occurred
at the offices of Schulte Roth & Zabel LLP, 919 Third Avenue, New York, New
York 10022.
(a)
Registration
Delay Waivers.
(i) Effective
as of the Closing Date, the Investor hereby agrees to permanently waive its
right to receive the unpaid Registration Delay Payments (as defined in the
Existing Registration Rights Agreement) and all other remedies and rights
accrued as a result of (A) the Company's failure to file the Additional
Registration Statement (as defined in the Existing Registration Rights
Agreement) on or prior to the Additional Filing Deadline (as defined in the
Existing Registration Rights Agreement) or (B) the Company's failure to
achieve effectiveness of the Additional Registration Statement (as defined
in
the Existing Registration Rights Agreement) on or prior to the Additional
Effectiveness Deadline (as defined in the Existing Registration Rights
Agreement), respectively; provided, however, that nothing in this Section 2(a)
shall be deemed to waive or amend the Company's obligation, effective as of
the
Closing Date, to (X) file the Additional Registration Statement (as defined
in
the Second Amended and Restated Registration Rights Agreement) on or prior
to
the Additional Filing Deadline (as defined in the Second Amended and Restated
Registration Rights Agreement) or (Y) achieve effectiveness of the
Additional Registration Statement as defined in the Second Amended and Restated
Registration Rights Agreement) on or prior to the Additional Effectiveness
Deadline (as defined in the Second Amended and Restated Registration Rights
Agreement), respectively.
(ii) Effective
as of the Closing Date, the Investor hereby agrees to permanently waive any
default relating to the Company's failure to pay the Investor the Letter
Agreement Payment Amount in a timely manner.
(b)
[deleted]
(c)
[deleted]
(d)
Waiver
re: Participation.
The
Investor hereby waives its rights, if any, pursuant to Section
4(n) of the Existing Securities Purchase Agreement and Section 2(c) of the
Amendment Agreement for purposes of the approximately $5 million purchase by
Pfizer Inc. or one of its affiliates ("Pfizer")
of the
Company's equity securities in connection with the Company's recently completed
transaction with Pfizer (the "Pfizer
Transaction")
and
the recently completed approximately $7 million financing (the "Contemplated
Financing")
and
any investment that the Company offers to the Investor and the Investor desires
to make in respect of the Company on terms similar to or the same as the
Contemplated Transaction.
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3.
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REPRESENTATIONS
AND WARRANTIES
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(a)
Investor
Bring Down.
The
Investor hereby represents and warrants to the Company as set forth in Section
2
of the Existing Securities Purchase Agreement as to this Agreement as if such
representations and warranties were made as of the date hereof and
set
forth
in
their entirety in this Agreement. The Investor further represents and warrants
to the Company that: (a) it is the sole holder of the Existing Notes;
(b) that it has not transferred beneficial ownership thereof; and (c) this
agreement shall constitute written consent of the Required Holders pursuant
to
Section 17 of the Existing Notes.
(b)
Company
Bring Down.
The
Company represents and warrants to the Investor as set forth in Section 3
of the Existing Securities Purchase Agreement as if such representations and
warranties were made as of the date hereof and set forth in their entirety
in
this Agreement; provided that the Schedules to the Amended Securities Purchase
Agreement are replaced in their entirety by the Schedules attached to this
Agreement. Such representations and warranties in the Amended Securities
Purchase Agreement to the transactions thereunder and the securities issued
thereby are hereby deemed for purposes of this Agreement to be references to
the
transactions hereunder and the issuance of the securities hereby, and references
therein to "Closing
Date"
being
deemed references to the Closing Date as defined in Section 1(c) above. The
Company further represents and warrants to the Investor that this Agreement,
the
redemption of the Existing Notes, the terms of the Series C Warrants, the issue
of the Series C Warrants, the terms of the Series D Warrants, the issue of
the
Series D Warrants, the terms of the Series E Warrants, the issue of the Series
E
Warrants, the terms of the Series F Warrants, the issue of the Series F
Warrants, the terms of the Series G Warrants, the issue of the Series G Warrants
and the agreement to issue shares or ADRs on conversion or exercise, as
applicable, of the Existing Notes or Series C Warrants, Series D Warrants,
Series E Warrants, Series F Warrants or Series G Warrants: (i) comply in all
respects with the Corporations Act 2001 (Cwth) and the Listing Rules of the
Australian Stock Exchange Limited; and, (ii) do not require any approval from
the Australian Stock Exchange Limited or shareholders of the Company.
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4.
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CERTAIN
COVENANTS AND AGREEMENTS; RELEASE
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(a)
Disclosure
of Transactions and Other Material Information.
On or
before 10:30 a.m., New York Time, on the
first
Business Day following the Closing Date, the Company shall publicly disclose
and
shall file a Form 6-K describing the terms of the transactions contemplated
by
this Agreement in the form required by the 1934 Act and attaching any material
transaction documents not previously filed as exhibits to such a filing
(including, without limitation, this Agreement (other than the schedules to
this
Agreement), the Second Amended and Restated Registration Rights Agreement,
the
Series C Warrants, the Series D Warrants, the Series E Warrants, the Series
F
Warrants and the Series G Warrants) as exhibits to such submission (such
submission including all attachments, the "Closing
6-K Filing").
From
and after the submission of the Closing 6-K Filing with the SEC, no Investor
shall be in possession of any material, nonpublic information received from
the
Company, any of its Subsidiaries or any of its respective officers, directors,
employees or agents, that is not disclosed in the Closing 6-K Filing or in
some
other public filing or public disclosure. The Company shall not, and shall
cause
each of its Subsidiaries and its and each of their respective officers,
directors, employees and agents, not to, provide the Investor with any material,
nonpublic information regarding the Company or any of its Subsidiaries from
and
after the filing of the Closing 6-K Filing with the SEC without the express
written consent of the Investor. In the event of a breach of the foregoing
covenant by the Company, any of its Subsidiaries, or any of its or their
respective officers, directors, employees and agents, in addition to any other
remedy provided herein or in the Transaction Documents, the Investor shall
have
the right to require the
Company
to make promptly a public disclosure, in the form of a press release, public
advertisement or otherwise, of such material, nonpublic information. Subject
to
the foregoing, neither the Company, its Subsidiaries nor the Investor shall
issue any press releases or any other public statements with respect to the
transactions contemplated hereby; provided,
however,
that
the Company shall be entitled, without the prior approval of the Investor,
to
make any press release or other public disclosure with respect to such
transactions (i) in substantial conformity with the Closing 6-K Filing and
contemporaneously therewith and (ii) as is required by applicable law and
regulations (provided that in the case of clause (i) the Investor shall be
consulted by the Company in connection with any such press release or other
public disclosure prior to its release).
(b)
Fees
and Expenses.
To the
extent that the Company has not already paid such amounts or the Investor has
not already otherwise offset such amounts, the Company shall reimburse the
Investor for its legal fees and expenses in connection with the preparation
and
negotiation of this Agreement by paying such amount to (i) Schulte Roth &
Zabel LLP as set forth in such firm's written invoice therefore (the
"SRZ
Expense")
and
(ii) Baker & McKenzie as set forth in such firm's written invoice
therefore (the "Baker
Expense",
and
together with the SRZ Expense, the "Investor
Counsel Expense").
Investor acknowledges and agrees that the Company has previously paid (or had
offset) One Hundred Thousand U.S. Dollars (US$100,000), which such amount may
be
deducted from the SRZ Expense. Except as otherwise set forth in this Agreement,
each party shall pay the fees and expenses of its advisers, counsel, accountants
and other experts, if any, and all other expenses incurred by such party
incident to the negotiation, preparation, execution, delivery and performance
of
this Agreement. The Company shall pay all stamp and other taxes and duties
levied in connection with the issuance of the New Warrants.
(c)
Schedules.
The
Company hereby agrees that the Schedules referred to in Section 3(b) and 4(a)
shall be delivered to the Investor no later than the fifth (5th) Business Day
after the date hereof.
(d)
Other
Notes.
The
Investor agrees that notwithstanding any provisions in the Existing Notes or
any
other agreements to which the Investor is a party (including without limitation,
the Subordination Agreements between the Investor and the holders of the New
Notes) to the contrary, at any time from and after the Closing, the Company
may
repay part or all of the principal amount of the New Notes.
(e)
Participation
Rights.
From
and after the Closing Date, the Investor shall no longer have any rights
pursuant to Section 4(n) of the Existing Securities Purchase Agreement or
Section 2(c) of the Amendment Agreement, or otherwise, to notice of or to
participate in any Subsequent Placement or any other offering or sale of
securities conducted by the Company.
| |
5.
|
CONDITIONS
TO COMPANY'S OBLIGATIONS HEREUNDER.
|
The
obligations of the Company to the Investor hereunder are subject to the
satisfaction or waiver of each of the following conditions, provided that these
conditions are
for
the
Company's sole benefit and may be waived by the Company at any time in its
sole
discretion by providing the Investor with prior written notice
thereof:
(a)
The
Investor shall have executed this Agreement and delivered the same to the
Company.
(b)
The
representations and warranties of the Investor shall be true and correct in
all
material respects (except for those representations and warranties that are
qualified by materiality or Material Adverse Effect, which shall be true and
correct in all respects) as of the date when made and as of the Closing Date
as
though made at that time (except for representations and warranties that speak
as of a specific date, which shall remain true and correct as of such specific
date).
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6.
|
CONDITIONS
TO INVESTOR'S OBLIGATIONS
HEREUNDER.
|
The
obligations of the Investor hereunder are subject to the satisfaction or waiver
of each of the following conditions, provided that these conditions are for
the
Investor's sole benefit and may be waived by the Investor at any time in its
sole discretion by providing the Company with prior written notice
thereof:
(a)
The
Company shall have executed this Agreement and delivered the same to the
Investor.
(b)
The
Company shall have executed and delivered to the Investor the Series D Warrants,
the Series E Warrants, the Series F Warrants and the Series G Warrants being
issued to such Investor at the Closing.
(c)
The
Company shall have delivered to the Company's transfer agent, with a copy to
the
Investor, a letter stating that the
Irrevocable Transfer Agent Instructions dated October 5, 2005 shall apply to
the
Existing
Warrant Shares, the New Warrant Shares and the Second Amended and Restated
Registration Rights Agreement.
(d)
Such
Investor shall have received the opinion of Curtis, Mallet-Prevost, Colt &
Mosle LLP, the Company's outside U.S. counsel, and Blake Dawson Waldron, the
Company's outside Australian counsel, each dated as of the Closing Date, similar
in all material respects to the opinions delivered pursuant to the Amendment
Agreement.
(e)
The
Company shall have delivered to the Investor a certificate, executed by the
Secretary of the Company and dated as of the Closing Date, as to (i) the
resolutions approving the transactions contemplated hereby as adopted by the
Board in a form reasonably acceptable to the Investor, and (ii) the
Constitution, each as in effect as of the Closing, similar in all material
respects to the certificate executed by the Secretary of the Company delivered
pursuant to the Amendment Agreement.
(f)
The
representations and warranties of the Company shall be true and correct in
all
material respects (except for those representations and warranties that are
qualified by materiality or Material Adverse Effect, which shall be true and
correct in all respects) as of the date when made and (if different) as of
the
Closing Date as though made at
that
time
(except for representations and warranties that speak as of a specific date,
which shall remain true and correct as of such specific date). The Investor
shall have received a certificate, executed by the Chief Executive Officer
of
the Company, dated as of the Closing Date, to the foregoing effect and as to
such other matters as may be reasonably requested by the Investor, similar
in
all material respects (except as set forth above) to the certificate executed
by
the Chief Executive Officer of the Company delivered pursuant to the Amendment
Agreement.
(g)
The
ADRs
(I) shall be designated for quotation or listed on the Principal Market and
(II)
shall not have been suspended, as of the Closing Date, by the SEC or the
Principal Market from trading on the Principal Market nor shall suspension
by
the SEC or the Principal Market have been threatened, as of the Closing Date,
either (A) in writing by the SEC or the Principal Market or (B) by falling
below
the minimum listing maintenance requirements of the Principal
Market.
(h)
The
Company shall have obtained all governmental, regulatory or third party consents
and approvals, if any, necessary for the issue and sale of the Securities,
including, without limitation, any approvals or notifications required by the
Principal Market.
(i)
The
Company shall have delivered to Schulte Roth & Zabel LLP a cash amount equal
to the SRZ Expense (reduced as set forth herein), by wire transfer of
immediately available funds pursuant to the wire instructions provided by
Schulte Roth & Zabel LLP.
(j)
The
Company shall have delivered to Baker & McKenzie a cash amount equal to the
Baker Expense, by wire transfer of immediately available funds pursuant to
the
wire instructions provided by Baker & McKenzie.
In
the
event that the Closing does not occur by May 21, 2007 (the "Termination
Date"),
due
to the Company's or the Investor's failure to satisfy the conditions set forth
in Sections 5 or 6 hereof (and the satisfying party's failure to waive such
unsatisfied conditions(s)), either party shall have the option to terminate
this
Agreement at the close of business on such date without liability of any party
to the other party; provided,
however,
that if
this Agreement is terminated by the Investor pursuant to this Section 8, the
Company shall remain obligated to reimburse the Investor for the expenses
described in Section 4(b) above. Upon such termination, the terms hereof shall
be null and void and the parties shall continue to comply with all terms and
conditions of the Transaction Documents, as in effect prior to the execution
of
this Agreement.
(a)
Counterparts.
This
Agreement may be executed in two or more identical counterparts, all of which
shall be considered one and the same agreement and shall become effective when
counterparts have been signed by each party and delivered to the
other
party;
provided that a facsimile signature shall be considered due execution and shall
be binding upon the signatory thereto with the same force and effect as if
the
signature were an original, not a facsimile signature.
(b)
Headings.
The
headings of this Agreement are for convenience of reference and shall not form
part of, or affect the interpretation of, this Agreement.
(c)
Severability.
If any
provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or
the
validity or enforceability of any provision of this Agreement in any other
jurisdiction.
(d)
Governing
Law; Jurisdiction; Jury Trial.
All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law provision
or
rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State
of
New York. Each party hereby irrevocably submits to the exclusive jurisdiction
of
the state and federal courts sitting in The City of New York, Borough of
Manhattan, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction
of
any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is
improper. Each party hereby irrevocably waives personal service of process
and
consents to process being served in any such suit, action or proceeding by
mailing a copy thereof to such party at the address for such notices to it
under
this Agreement 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.
If any provision of this Agreement shall be invalid or unenforceable in any
jurisdiction, such invalidity or unenforceability shall not affect the validity
or enforceability of the remainder of this Agreement in that jurisdiction or
the
validity or enforceability of any provision of this Agreement in any other
jurisdiction. EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED
HEREBY.
(e)
No
Third Party Beneficiaries.
This
Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person.
(f)
Further
Assurances.
Each
party shall do and perform, or cause to be done and performed, all such further
acts and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated
hereby.
(g)
No
Strict Construction.
The
language used in this Agreement will be deemed to be the language chosen by
the
parties to express their mutual intent, and no rules of strict construction
will
be applied against any party.
(h)
Entire
Agreement; Effect on Prior Agreements; Amendments.
Except
for the Transaction Documents (to the extent any such Transaction Document
is
not amended by this Agreement), this Agreement supersedes all other prior oral
or written agreements between the Investor, the Company, their affiliates and
Persons acting on their behalf with respect to the matters discussed herein,
and
this Agreement and the instruments referenced herein contain the entire
understanding of the parties with respect to the matters covered herein and
therein and, except as specifically set forth herein or therein, neither the
Company nor the Investor makes any representation, warranty, covenant or
undertaking with respect to such matters. No provision of this Agreement may
be
amended other than by an instrument in writing signed by the Company and the
Investor. No provision hereof may be waived other than by an instrument in
writing signed by the party against whom enforcement is sought. No consideration
shall be offered or paid to any Person to amend or consent to a waiver or
modification of any provision of any of the Transaction Documents unless the
same consideration also is offered to all of the parties to the Transaction
Documents, holders of Existing Notes or holders of the Existing Warrants and
the
New Warrants, as the case may be. The Company has not, directly or indirectly,
made any agreements with the Investor relating to the terms or conditions of
the
transactions contemplated by the Transaction Documents except as set forth
in
the Transaction Documents.
(i)
Notices.
Any
notices, consents, waivers or other communications required or permitted to
be
given under the terms of this Agreement must be in writing and will be deemed
to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is
mechanically or electronically generated and kept on file by the sending party);
or (iii) one Business Day after deposit with an overnight courier service,
in
each case properly addressed to the party to receive the same. The addresses
and
facsimile numbers for such communications shall be:
If
to the
Company:
pSivida
Limited
400
Pleasant Street
Watertown,
MA 02472
Telephone:
+1
617
926 5000
Facsimile:
+1
617
926 5050
Attention:
General
Counsel
with
a
copy (for informational purposes only) to:
Curtis,
Mallet-Prevost, Colt & Mosle LLP
101
Park
Avenue
New
York,
NY 10178
Telephone:
212-696-6000
Facsimile:
212-697-1559
Attention:
Lawrence
Goodman, Esq.
If
to the
Investor, to its address and facsimile number set forth in the Amended
Securities Purchase Agreement, with copies to the Investor's representatives
as
set forth on the Amended Securities Purchase Agreement or on the signature
page
to this Agreement,
with
a
copy (for informational purposes only) to:
Schulte
Roth & Zabel LLP
919
Third
Avenue
New
York,
New York 10022
U.S.A.
Telephone:
(212)
756-2000
Facsimile:
(212)
593-5955
Attention:
Eleazer
N. Klein, Esq.
or
to
such other address and/or facsimile number and/or to the attention of such
other
Person as the recipient party has specified by written notice given to each
other party five (5) days prior to the effectiveness of such change. Written
confirmation of receipt (A) given by the recipient of such notice, consent,
waiver or other communication, (B) mechanically or electronically generated
by
the sender's facsimile machine containing the time, date, recipient facsimile
number and an image of the first page of such transmission or (C) provided
by an
overnight courier service shall be rebuttable evidence of personal service,
receipt by facsimile or receipt from an overnight courier service in accordance
with clause (i), (ii) or (iii) above, respectively.
The
Company hereby irrevocably appoints pSivida Inc., of 400 Pleasant Street,
Watertown, MA, U.S.A. ("pSivida
Inc.")
as its
agent for the receipt of service of process in the United States. The Company
agrees that any document may be effectively served on it in connection with
any
action, suit or proceeding in the United States by service on its agents. The
Investor consents and agrees that the Company may, in its reasonable discretion,
irrevocably appoint a substitute agent for the receipt of service of process
located within the United States, and that upon such appointment, the
appointment of pSivida Inc. may be revoked.
Any
document shall be deemed to have been duly served if marked for the attention
of
the agent at its address as set forth in Section 9(i) or such other address
in
the United States as may be notified to the party wishing to serve the document
and (a) left at the specified address if its receipt is acknowledged in writing;
or (b) sent to the specified address by post, registered mail return receipt
requested. In the case of (a), the document will be deemed to have been duly
served when it is left and signed for. In the case of (b), the document shall
be
deemed to have been duly served when received and acknowledged.
If
the
Company's agent at any time ceases for any reason to act as such, the Company
shall appoint a replacement agent having an address for service in the United
States and shall notify the Investor of the name and address of the replacement
agent. Failing such appointment and notification, the holders of the Existing
Warrants and the New Warrants representing not less than a majority of the
aggregate New Warrant Shares and Existing Warrant Shares shall be entitled
by
notice to the Company to appoint a replacement agent to act on the Company's
behalf. The provisions of this Section 9(i) applying to service on an agent
apply equally to service on a replacement agent.
(j)
Successors
and Assigns.
This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective successors and assigns in accordance with the terms of the
Amended Securities Purchase Agreement.
(k)
Survival.
Unless
this Agreement is terminated under Section 8, the representations and warranties
of the Company and the Investor contained herein and the agreements and
covenants set forth herein shall survive the Closing.
(l)
Remedies.
The
Investor and each holder of the Securities shall have all rights and remedies
set forth in the Transaction Documents and all rights and remedies which such
holders have been granted at any time under any other agreement or contract
and
all of the rights which such holders have under any law. Any Person having
any
rights under any provision of this Agreement shall be entitled to enforce such
rights specifically (without posting a bond or other security), to recover
damages by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law. Furthermore, the Company recognizes
that in the event that it fails to perform, observe, or discharge any or all
of
its obligations under this Agreement, any remedy at law may prove to be
inadequate relief to the Investor. The Company therefore agrees that the
Investor shall be entitled to seek temporary and permanent injunctive relief
in
any such case without the necessity of proving actual damages and without
posting a bond or other security.
[Signature
Page Follows.]
IN
WITNESS WHEREOF,
the
Investor and the Company have caused their respective signature page to this
Agreement to be duly executed as of the date first written above.
|
COMPANY:
|
| |
|
PSIVIDA
LIMITED
By:
/s/
Michael J. Soja
Name:
Michael J. Soja
Title:
Vice President of Finance and Chief Financial
Officer
|
[Signature
Page to Amended and Restated Second Amendment Agreement]
IN
WITNESS WHEREOF,
the
Investor and the Company have caused their respective signature page to this
Agreement to be duly executed as of the date first written above.
|
INVESTOR:
CASTLERIGG MASTER INVESTMENTS LTD.
|
| |
|
BY:
SANDELL ASSET MANAGEMENT CORP
By:
/s/
Timothy O’Brien
Name:
Timothy O’Brien
Title:
Chief Financial Officer
|
EX 99.3
EXHIBIT
99.3
SECOND
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
SECOND
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this “Agreement”),
dated
as of May 15, 2007, by and among pSivida
Limited, an
Australian corporation, with headquarters located at Level 12 BGC Centre, 28
The
Esplanade, Perth Australia 6000 (the “Company”),
and
Castlerigg Master Investments Ltd. (the “Investor”).
WHEREAS:
A. The
Company and the Investor (collectively with any other investors that may become
a party to this Agreement, the “Investors”)
are
parties to that certain Securities Purchase Agreement, dated as of October
5,
2005 (the “Securities
Purchase Agreement”),
pursuant to which, among other things, the Investors purchased from the Company
(i) Subordinated Convertible Notes, dated November 16, 2005 (the
“Original
Notes”)
and
(ii) warrants (the “Original
Warrants”),
which
are exercisable to purchase ADSs (the “Original
Warrant Shares”).
B. In
connection with the Amendment Agreement by and between the Company and the
Investor, dated as of July 28, 2006, (the “Amendment
Agreement”),
the
Company, among other things, (i) amended and restated the Original Notes (as
amended and restated, the “Existing
Notes”),
which
are convertible into ADSs (as converted, the “Existing
Conversion Shares”),
in
accordance with the terms thereof, (ii) issued to the Investor warrants (the
“Series
A Warrants”)
which
are exercisable to purchase ADSs (the “Series
A Warrant
Shares”),
(iii)
became obligated under the terms of the Existing Notes to issue to the investor,
from time to time upon the occurrence of certain events, Series B warrants
exercisable into ADSs, and (iv) entered into that certain Amended and Restated
Registration Rights Agreement, by and among the Company and the Investor, dated
as of September 14, 2006 (the “Amended
and Restated Registration Rights Agreement”)
which
amended and restated that certain Registration Rights Agreement, by and between
the Company and the Investor, dated as of November 16, 2005 whereby the Company
granted to the Investor certain registration rights under the Securities Act
of
1933, as amended, and the rules and regulations thereunder, or any similar
successor statute (collectively, the “1933
Act”),
and
applicable state securities laws.
C. In
connection with that certain Letter Agreement, by and between the Company and
the Investor, dated October 17, 2006 (the “Letter
Agreement”),
the
Company agreed to make certain payments to the Investor, and the Company and
the
Investor amended certain of the provisions of the Amended and Restated
Registration Rights Agreement in connection with the Registration Statement
on
Form F-3 (SEC File No. 333-132777) (the “Initial
Registration Statement”)
registering 12,737,139 ADSs issuable to the Investor (x) upon conversion of
the
Existing Notes, (y) as interest on the Existing Notes and (z) upon
exercise of the Original Warrants, which such Registration Statement was
declared effective by the SEC on September 29, 2006.
D. In
connection with the Second Amendment Agreement by and between the Company
and the Investor, dated as of December 29, 2006, (the “Second
Amendment Agreement”),
the
Company (i) issued to the Investor warrants (the “Series
C Warrants”
and
together with the Series A Warrants and the Original Warrants, the “Existing
Warrants”)
which
are exercisable to purchase ADSs (the “Series
C Warrant
Shares”
and
together with the Series A Warrant Shares and the Original Warrant Shares,
the “Existing
Warrant Shares”)
and
(ii) agreed, among other things, (x) to further amend and restate the Existing
Notes and (y) to issue the Investor warrants (the “Series
D Warrants”)
which
shall be exercisable to purchase ADSs (the “Series
D Warrant Shares”)
at
US$2.00 per ADS.
E. In
connection with the Amended and Restated Second Amendment Agreement, dated
as of
the date hereof (the “Amended
and Restated Second Amendment Agreement”),
the
Company has (i) redeemed the Existing Notes (the “Notes”);
(ii)
issued to the Investor Series D Warrants exercisable into Series D Warrant
Shares, (iii) issued to the Investor additional warrants (the “Series
E Warrants”),
which
are exercisable to purchase Four Million (4,000,000) ADSs (the “Series
E Warrant Shares”)
at
US$1.57 per ADS, (iv) issued to the Investor additional warrants (the
“Series
F Warrants”),
which
are exercisable to purchase One Million (1,000,000) ADSs (the “Series F
Warrant Shares”)
for
US$1.95 per ADS, and (v) issued to the Investor additional warrants (the
“Series
G Warrants”
and
together with the Existing Warrants, the Series D Warrants, the Series E
Warrants and the Series F Warrants, the “Warrants”),
which
are exercisable to purchase Two Million Three Hundred Forty One Thousand Three
Hundred Forty Seven (2,341,347) ADSs (the “Series G
Warrant Shares”
and
together with the Existing Warrant Shares, the Series D Warrant Shares, the
Series E Warrant Shares and the Series F Warrant Shares, the “Warrant
Shares”)
for
US$1.21 per ADS.
F. In
connection with the Amended and Restated Second Amendment Agreement, the Company
has agreed to execute and deliver this Agreement which amends, restates and
consolidates the terms and conditions of the Amended and Restated Registration
Rights Agreement.
NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency
of
which are hereby acknowledged, the Company and each of the Buyers hereby agree
as follows:
1. Definitions.
As
used
in this Agreement, the following terms shall have the following
meanings:
a. “ADSs”
means
the American Depositary Shares of the Company evidenced by American Depositary
Receipts each of which represents ten (10) Ordinary Shares (as defined
below).
b. “Additional
Effective Date”
means
the date the Additional Registration Statement has been declared effective
by
the SEC.
c. “Additional
Effectiveness Deadline”
means
the date sixty (60) days after the Additional Filing Deadline, or in the event
that the SEC institutes a review of and/or
issues
comments (including, without limitation, any correspondence or other
communication by the staff of the SEC which requires the Company to reduce
the
number of Ordinary Shares registered on any Registration Statement or otherwise
requires the Company to file an amendment to such Registration Statement) with
respect to the Additional Registration Statement, the date one hundred twenty
(120) days after the Additional Filing Deadline.
d. “Additional
Filing Date”
means
the date on which the Additional Registration Statement is filed with the
SEC.
e. “Additional
Filing Deadline”
means
the date ten (10) days following the Closing Date.
f. “Additional Registrable
Securities”
means
the Ordinary Shares underlying (i) the Series A Warrant Shares, (ii) the Series
C Warrant Shares, (iii) the Series D Warrant Shares, (iv) the
Series E Warrant Shares, (v) the Series F Warrant Shares, (vi) the
Series G Warrant Shares and (vii) any shares of capital stock issued
or issuable with respect to the Series A Warrant Shares, the Series C Warrant
Shares, the Series D Warrant Shares, the Series E Warrant Shares, the
Series F Warrant Shares or the Series G Warrant Shares as a result of any stock
split, stock dividend, recapitalization, exchange or similar event or otherwise,
without regard to any limitations on exercises of the Warrants.
g. “Additional
Registration Statement”
means
a
registration statement or registration statements of the Company filed under
the
1933 Act covering any Additional Registrable Securities.
h. “Additional
Required Registration Amount”
means
(I) Registrable Securities representing (i) 130% of the number of Series A
Warrant Shares issued and issuable pursuant to the Series A Warrants as of
the
Trading Day (as defined below) immediately preceding the applicable date of
determination, (ii) 130% of the number of Series C Warrant Shares issued and
issuable pursuant to the Series C Warrants as of the Trading Day immediately
preceding the applicable date of determination, (iii) 130% of the number of
Series D Warrant Shares issued and issuable pursuant to the Series D
Warrants as of the Trading Day immediately preceding the applicable date of
determination, (iv) 130% of the number of Series E Warrant Shares
issued and issuable pursuant to the Series E Warrants as of the Trading Day
immediately preceding the applicable date of determination, (v) 130% of the
number of Series F Warrant Shares issued and issuable pursuant to the
Series F Warrants as of the Trading Day immediately preceding the
applicable date of determination and (vi) 130% of the number of Series G
Warrant Shares issued and issuable pursuant to the Series G Warrants as of
the Trading Day immediately preceding the applicable date of determination,
in
each case subject to adjustment as provided in Section 2(g) or (II) such other
amount as may be required by the staff of the SEC pursuant to Rule 415 or
otherwise.
i. “Business
Day”
means
any day other than Saturday, Sunday or any other day on which commercial banks
in The City of New York, State of New York, U.S.A. or Perth, Australia are
authorized or required by law to remain closed.
j. “Closing
Date”
shall
have the meaning set forth in the Amended and Restated Second Amendment
Agreement.
k. "Cutback
Shares"
means
any of the Initial Required Registration Amount or Additional Required
Registration Amount of Registrable Securities not included in a an effective
Registration Statement filed pursuant to this Agreement as a result of a
limitation on the number of Ordinary Shares of the Company permitted to be
registered on any such Registration Statement by the staff of the SEC pursuant
to Rule 415 or otherwise.
l. “Effective
Date”
means,
with respect to the Initial Registration Statement, the Additional Registration
Statement or a Subsequent Registration Statement, the date such Registration
Statement has been declared effective by the SEC.
m. “Effectiveness
Deadline”
means
the Initial Effectiveness Deadline (as defined below), the Additional
Effectiveness Deadline and the Subsequent Effectiveness Deadline (as defined
below), as applicable.
n. “Eligible
Market”
means
the Nasdaq Global Market, The New York Stock Exchange, Inc., the American Stock
Exchange, or The Nasdaq Capital Market.
o. “Initial Effectiveness
Deadline”
means
October 15, 2006.
p. “Initial Registrable
Securities”
means
the Ordinary Shares underlying (i) the ADSs into which the Notes are
convertible in accordance with the terms thereof (the “Conversion
Shares”),
(ii) the Original Warrant Shares, (iii) any Interest Shares (as defined in
the Notes) issued or issuable under the Notes, and (iv) any shares of
capital stock issued or issuable with respect to the Conversion Shares, the
Interest Shares, the Original Warrant Shares, the Notes and the Original
Warrants, as a result of any stock split, stock dividend, recapitalization,
exchange or similar event or otherwise, without regard to any limitations on
conversions of the Notes or exercises of the Original Warrants.
q. “Initial Required
Registration Amount”
means
the Ordinary Shares underlying 12,737,139 ADSs representing not less than (i)
130% of the number of Conversion Shares issued and issuable as of the Trading
Day immediately preceding the applicable date of determination, (ii) 130% of
the
number of Original Warrant Shares issued and issuable pursuant to the Original
Warrants as of the Trading Day immediately preceding the applicable date of
determination, in each case subject to adjustment as provided in Section 2(g)
and (iii) 100% of the Interest Shares paid by the Company.
r. “Investor”
means
a
Buyer, any transferee or assignee thereof to whom a Buyer assigns its rights
under this Agreement and who agrees to become bound by the provisions of this
Agreement in accordance with Section 9 and any transferee or assignee thereof
to
whom a transferee or assignee assigns its rights under this Agreement and who
agrees to become bound by the provisions of this Agreement in accordance with
Section 9.
s. “Ordinary
Shares”
means
ordinary shares of the Company.
t. “Person”
means
an individual, a limited liability company, a partnership, a joint venture,
a
corporation, a trust, an unincorporated organization and a government or any
department or agency thereof.
u. “Purchase
Price”
means,
with respect to a convertible note, the principal amount of such convertible
note, and, with respect to a warrant, the number of shares subject to such
warrant multiplied by the then current per share exercise price provided for
therein.
v. “register,”
“registered,”
and
“registration”
refer
to a registration effected by preparing and filing one or more Registration
Statements in compliance with the 1933 Act and pursuant to Rule 415 and the
declaration or ordering of effectiveness of such Registration Statement(s)
by
the SEC.
w. “Registrable
Securities”
means
the Initial Registrable Securities, the Additional Registrable Securities and
the Subsequent Registrable Securities.
x. “Registration
Statement”
means
a
registration statement or registration statements of the Company filed under
the
1933 Act covering Registrable Securities.
y. “Required
Holders”
means
the holders of at least a majority of the Registrable Securities.
z. “Required
Registration Amount”
means
(a) with respect to an Initial Registration Statement, the Initial Required
Registration Amount, (b) with respect to the Additional Registration
Statement, the Additional Required Registration Amount, and (c) with
respect to a Subsequent Registration Statement, the Subsequent Required
Registration Amount.
aa. “Rule
415”
means
Rule 415 under the 1933 Act or any successor rule providing for offering
securities on a continuous or delayed basis.
bb. "Subsequent
Effectiveness Date"
means
the date the Subsequent Registration Statement is declared effective by the
SEC.
cc. “Subsequent
Effectiveness Deadline”
with
respect to a Subsequent Registration Statement means the date which is sixty
(60) calendar days after the Subsequent Filing Date with respect to such
Subsequent Registration Statement or in the event that the SEC institutes a
review of and/or issues comments with respect to such Subsequent Registration
Statement (including, without limitation, any correspondence or other
communication by the staff of the SEC which requires the Company to reduce
the
number of Ordinary Shares registered on any Registration Statement or otherwise
requires the Company to file an amendment to such Registration Statement),
one-hundred and twenty (120) calendar days after the Subsequent Filing Date
with
respect to such Subsequent Registration Statement.
dd. "Subsequent
Filing Date"
with
respect to a Subsequent Registration Statement means the date on which such
Subsequent Registration Statement is filed with the SEC.
ee. “Subsequent
Filing Deadline”
means
if Cutback Shares are required to be included in a Subsequent Registration
Statement, the later of (i) the date sixty (60) days after the date that the
Company receives notice from the Required Holders that substantially all of
the
Registrable Securities registered
under the immediately preceding Registration Statement have been sold
and
(ii)
the date six (6) months from the Additional Effective Date or the most recent
Effective Date occurring after the Additional Effective Date, as
applicable.
ff. “Subsequent
Registrable Securities”
means,
(i) any Cutback Shares not previously included on a Registration Statement
and
(ii) any share capital of the Company issued or issuable with respect to the
Warrants, the Warrant Shares or Cutback Shares, as applicable, as a result
of
any stock split, stock dividend, recapitalization, exchange or similar event
or
otherwise, without regard to any limitations on exercise of the
Warrants.
gg. “Subsequent
Registration Statement”
means
a
registration statement or registration statements of the Company filed under
the
1933 Act covering any Subsequent Registrable Securities.
hh. “Subsequent
Required Registration Amount”
means
any Cutback Shares not previously included on a Registration Statement, all
subject to adjustment as provided in Section 2(g), without regard to any
limitations on exercise of the Warrants, which have not previously been sold
pursuant to an effective registration statement, without restriction pursuant
to
Rule 144(k) or on the ASX.
ii. “SEC”
means
the United States Securities and Exchange Commission.
jj. “Trading
Day”
means
any day on which the ADSs are traded on the Nasdaq Global Market, or, if the
Nasdaq Global Market is not the principal trading market for the ADSs, then
on
the principal securities exchange or securities market on which the ADSs are
then traded; provided that “Trading Day” shall not include any day on which the
ADSs are scheduled to trade on such exchange or market for less than 4.5 hours
or any day that the ADSs are suspended from trading during the final hour of
trading on such exchange or market (or if such exchange or market does not
designate in advance the closing time of trading on such exchange or market,
then during the hour ending at 4:00:00 p.m., New York Time).
Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings set forth in the Amended and Restated Second Amendment Agreement.
In
the event that the Company’s Board of Directors should determine that the
Company shall transform itself (whether by re-incorporation in the United States
or otherwise) from a foreign private issuer (as defined in the Securities Act
of
1933, as amended), all references to ADSs shall be deemed references to the
securities that are substituted for the ADSs with equitable adjustment of the
provisions of this Agreement for such substituted securities.
2. Registration.
a. Initial
Mandatory Registration.
The
Company has prepared, and (i) filed with the SEC the Initial Registration
Statement on Form F-3 covering the resale of all of the Initial Registrable
Securities. The Initial Registration Statement prepared pursuant hereto
registered for resale the Initial Required Registration Amount. The Initial
Registration Statement
contained
the “Selling
Shareholders”
and
“Plan
of Distribution”
sections in substantially the form attached hereto as Exhibit
B,
with
such changes as were necessary or appropriate and mutually agreed by the
parties. The Initial Registration Statement was declared effective by the SEC
on
September 29, 2006.
b. Additional
Mandatory Registrations.
The
Company shall prepare, and, no later than the Additional Filing Deadline, file
with the SEC an Additional Registration Statement on Form F-3 covering the
resale of all of the Additional Registrable Securities. In the event that Form
F-3 or Form S-3 is unavailable for such a registration, the Company shall use
Form F-1 or Form S-1, as applicable, subject to the provisions of Section 2(f).
The Additional Registration Statement shall register for resale at least that
number of ADSs equal to the Additional Required Registration Amount as of the
date the Additional Registration Statement is initially filed with the SEC.
The
Additional Registration Statement shall contain (except if otherwise directed
by
the Required Holders) the “Selling Stockholders” and “Plan of Distribution”
sections in substantially the form attached hereto as Exhibit
B,
with
such changes as may be appropriate to reflect the inclusion of other permissible
securities of the Company and other changes which may be necessary or
appropriate. The Company shall use its reasonable best efforts to have the
Additional Registration Statement declared effective by the SEC as soon as
practicable after its filing, but in no event later than the Additional
Effectiveness Deadline. By 9:30 a.m. New York time on the date following the
Additional Effective Date,
the
Company shall file with the SEC in accordance with Rule 424 under the 1933
Act
the final prospectus to be used in connection with sales pursuant to such
Registration Statement.
c. Subsequent
Mandatory Registrations.
The
Company shall prepare, and, as soon as practicable but in no event later than
the Subsequent Filing Deadline, file with the SEC a Subsequent Registration
Statement on Form F-3 covering the resale of all of the Subsequent Registrable
Securities. In the event that Form F-3 or Form S-3 is unavailable for such
a
registration, the Company shall use Form F-1 or Form S-1, as applicable, subject
to the provisions of Section 2(f). To the extent the staff of the SEC does
not
permit the Subsequent Required Registration Amount to be registered on a
Subsequent Registration Statement, the Company shall file Subsequent
Registration Statements (consistent with the comments or instructions of the
staff of the SEC) successively trying to register on each such Subsequent
Registration Statement the maximum number of remaining Subsequent Registrable
Securities until the Subsequent Required Registration Amount has been registered
with the SEC. Each Subsequent Registration Statement prepared pursuant hereto
shall register for resale at least that number of ADSs equal to the Subsequent
Required Registration Amount (or such lesser number of Registrable Securities
dictated by the staff of the SEC) as of date the Registration Statement is
initially filed with the SEC. Each Subsequent Registration Statement shall
contain (except if otherwise directed by the Required Holders) the "Selling
Stockholders" and "Plan of Distribution" sections in substantially the form
attached hereto as Exhibit
B,
with
such changes as may be appropriate to reflect the inclusion of other permissible
securities of the Company and other changes which may be necessary or
appropriate. The Company shall use its best efforts to have each Subsequent
Registration Statement declared effective by the SEC as soon as practicable,
but
in no event later than the Subsequent Effectiveness Deadline with respect to
such Subsequent Registration Statement. By 9:30 a.m. New York time on the date
following the Subsequent Effective Date,
the
Company shall file with the SEC in accordance with Rule 424
under
the
1933 Act the final prospectus to be used in connection with sales pursuant
to
such Registration Statement.
d. Allocation
of Registrable Securities.
The
initial number of Registrable Securities included in any Registration Statement
and any increase in the number of Registrable Securities included therein shall
be allocated pro rata among the Investors based on the number of Registrable
Securities held by each Investor at the time the Registration Statement covering
such initial number of Registrable Securities or increase thereof is declared
effective by the SEC. In the event that an Investor sells or otherwise transfers
any of such Investor’s Registrable Securities, each transferee shall be
allocated a pro rata portion of the then remaining number of Registrable
Securities included in such Registration Statement for such transferor. Any
ADSs
included in a Registration Statement and which remain allocated to any Person
which ceases to hold any Registrable Securities covered by such Registration
Statement shall be allocated to the remaining Investors, pro rata based on
the
number of Registrable Securities then held by such Investors which are covered
by such Registration Statement. Other than as permitted by Section 4(k) of
the
Securities Purchase Agreement, in no event shall the Company include any
securities other than Registrable Securities on any Registration Statement
without the prior written consent of the Required Holders.
e. Legal
Counsel.
Subject
to Section 5 hereof, the Required Holders shall have the right to select one
legal counsel to review and oversee any registration pursuant to this Section
2,
which shall be Schulte Roth & Zabel LLP or such other counsel as is
thereafter designated in writing by the Required Holders prior to the initiation
of such other legal counsel’s review and oversight of any registration
(“Legal
Counsel”).
The
Company and Legal Counsel shall reasonably cooperate with each other in
performing the Company’s obligations under this Agreement.
f. Ineligibility
for Form F-3 or Form S-3.
In the
event that Form F-3 or Form S-3 is not available for the registration of the
resale of Registrable Securities hereunder, the Company shall (i) register
the
resale of the Registrable Securities on another appropriate form reasonably
acceptable to the Required Holders and (ii) undertake to register the
Registrable Securities on Form F-3 or Form S-3 as soon as such form is
available, provided that the Company shall maintain the effectiveness of the
Registration Statement then in effect until such time as a Registration
Statement on Form F-3 or Form S-3 covering the Registrable Securities has been
declared effective by the SEC.
g. Sufficient
Number of ADSs Registered.
In the
event the number of Ordinary Shares available under a Registration Statement
filed pursuant to Section 2(a) is insufficient to cover all of the Registrable
Securities required to be covered by such Registration Statement or an
Investor’s allocated portion of the Registrable Securities pursuant to Section
2(c), the Company shall amend the applicable Registration Statement, or file
a
new Registration Statement (on the short form available therefor, if
applicable), or both, so as to cover at least the Required Registration Amount
as of the Trading Day immediately preceding the date of the filing of such
amendment or new Registration Statement, in each case, as soon as practicable,
but in any event not later than fifteen (15) Business Days after the necessity
therefor arises. The Company shall use its best efforts to cause such amendment
and/or new Registration Statement to become effective as soon as practicable
following the filing thereof. For purposes of the
foregoing
provision, the number of Ordinary Shares available under a Registration
Statement shall be deemed “insufficient to cover all of the Registrable
Securities” if at any time the number of Ordinary Shares available for resale
under the Registration Statement is less than the product determined by
multiplying (i) the Required Registration Amount by (ii) 0.90. The
calculation set forth in the foregoing sentence shall be made without regard
to
any limitations on the exercise of the Warrants and such calculation shall
assume that the Warrants are then exercisable to purchase ADSs
and are
issuable at the then prevailing Exercise Price (as defined in the Warrants),
as
applicable.
h. Effect
of Failure to File and Obtain and Maintain Effectiveness of Registration
Statement.
(1) On
September 14, 2006, as relief for the damages to the Investor by reason of
the
delay prior to such date in its ability to sell the ADSs (which remedy shall
not
be exclusive of any other remedies available at law or in equity), the Company
paid to the Investor an amount in cash equal to $129,166.67. Pursuant to the
Letter Agreement, the Company agreed to make certain other payments to the
Investor as consideration for the Investor entering into the Letter Agreement
and in lieu of any Registration Delay Payments which had not yet been made
and
would otherwise be incurred by the Company or due to the Investor.
Notwithstanding any provision of the Amended and Restated Registration Rights
Agreement, no amounts are due from the Company to the Investor under this
Agreement or the Amended and Restated Registration Rights Agreement in respect
of any Registration Delay Payments as of the date of this Agreement in respect
of the Company’s not having filed an Additional Registration Statement prior to
the date of this Agreement or the Additional Filing Deadline.
(2) If
a
Registration Statement covering all of the Additional Registrable Securities
required to be covered thereby and required to be filed by the Company pursuant
to this Agreement is not declared effective by the SEC on or before the
Additional Effectiveness Deadline (an “Additional
Effectiveness Failure”)
then,
as partial relief for the damages to any holder by reason of any such delay
in
or reduction of its ability to sell the ADSs (which remedy shall not be
exclusive of any other remedies available at law or in equity), the Company
shall pay to each Investor holding Registrable Securities relating to such
Registration Statement on the date of such Additional Effectiveness Failure
an
amount in cash equal to such Investor’s pro rata share of (a) eight
thousand three hundred thirty-three U.S. dollars (US$8,333) for each day in
the
period beginning on December 31, 2006 and ending on the date of such Additional
Effectiveness Failure and (b) eight thousand one hundred fifteen U.S.
dollars ($8,115) for each day in the period beginning on the date of this
Agreement and ending on the date of such Additional Effectiveness
Failure.
(3) In
the
event that:
(A) a
Registration Statement covering all of the Registrable Securities required
to be
covered thereby and required to be filed by the Company pursuant to this
Agreement is not, with respect to a Subsequent Registration Statement, declared
effective by the SEC on or before the Subsequent Effectiveness Deadline (a
“Subsequent
Effectiveness Failure”);
(B) a
Registration Statement covering all of the Registrable Securities required
to be
covered thereby and required to be filed by the Company pursuant to this
Agreement is not, with respect to an Additional Registration Statement, filed
with the SEC on or before the Additional Filing Deadline (an “Additional
Filing Failure”)
(provided that, no Additional Filing Failure shall be deemed to have occurred
in
the event that the Company withdraws an Additional Registration Statement at
request of the SEC filed on or before the Additional Filing Deadline and files
a
subsequent Additional Registration Statement after the Additional Filing
Deadline and prior to the Additional Effectiveness Deadline);
(C) an
Additional Effectiveness Failure occurs; or
(D) on
any
day after the applicable Effective Date (I) sales of all of the Registrable
Securities required to be included on such Registration Statement cannot be
made
(other than during an Allowable Grace Period (as defined in Section 3(r))
pursuant to such Registration Statement (including, without limitation, because
of a failure to keep such Registration Statement effective, to disclose such
information as is necessary for sales to be made pursuant to such Registration
Statement or to register a sufficient number of ADSs), or (II) the
Registrable Securities are not listed or included for quotation on an Eligible
Market or trading of the ADSs is suspended or halted thereon (other than during
an Allowable Trading Grace Period) (each, a “Maintenance
Failure”),
then,
as
partial relief for the damages to any holder by reason of any such delay in
or
reduction of its ability to sell the ADSs (which remedy shall not be exclusive
of any other remedies available at law or in equity), the Company shall pay
to
each holder of Registrable Securities relating to such Registration Statement
an
amount in cash equal to one and one half percent (1.5%) of the aggregate
Purchase Price of such Investor’s Registrable Securities included in such
Registration Statement on each of the following dates:
(X)
every
thirtieth day (pro rated for periods totaling less than thirty days) from the
date of a Subsequent Effectiveness Failure until such Subsequent Effectiveness
Failure is cured;
(Y) every
thirtieth day (pro rated for periods totaling less than thirty days) from the
date of an Additional Effectiveness Failure until such Additional Effectiveness
Failure is cured; and
(Z) every
thirtieth day (pro rated for periods totaling less than thirty days) from the
date of a Maintenance Failure until such Maintenance Failure is cured;
provided,
however,
that
such amount shall not be duplicative or owed more than once with respect to
any
day which falls within a period described in more than one of clauses (X) and
(Y) immediately preceding this proviso.
(4) The
payments to which a holder shall be entitled pursuant to this Section 2(h)
are referred to herein as “Registration
Delay Payments.”
Registration Delay Payments shall be deemed “incurred”, for purposes of the
following sentence, on the thirtieth day following the applicable failure and
such payments shall be made (except as set forth elsewhere in this Section
2(h))
on the earlier of (A) the last day of the calendar month during which
such
Registration
Delay Payments are incurred and (B) the fifth Business Day after the event
or
failure giving rise to the Registration Delay Payments is cured. In the event
the Company fails to make Registration Delay Payments in a timely manner, such
Registration Delay Payments shall bear interest at the rate of 1.0% per month
(prorated for partial months) until paid in full.
3. Related
Obligations.
At
such
time as the Company is obligated to file a Registration Statement with the
SEC
pursuant to Section 2(a), 2(b), 2(c) or 2(g), the Company will use its
reasonable best efforts to effect the registration of the Registrable Securities
consistent with the Plan of Distribution and, pursuant thereto, the Company
shall have the following obligations:
a. The
Company shall promptly prepare and file with the SEC a Registration Statement
with respect to the Registrable Securities and use its reasonable best efforts
to cause such Registration Statement relating to the Registrable Securities
to
become effective as soon as practicable after such filing (but in no event
later
than the applicable Effectiveness Deadline). The Company shall keep (i) each
Registration Statement effective pursuant to Rule 415 and (ii) the Company's
Form F-6, Registration Number 333-122158 effective (and such Form F-6 shall
have
available the number of ADSs to cover all of the Registrable Securities) at
all
times until the earlier of (i) the date as of which the Investors may sell
all
of the Registrable Securities covered by such Registration Statement without
restriction pursuant to Rule 144(k) (or successor thereto) promulgated under
the
1933 Act or (ii) the date on which the Investors shall have sold all the
Registrable Securities covered by such Registration Statement (the “Registration
Period”),
which
Registration Statement (including any amendments or supplements thereto and
prospectuses contained therein) shall not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein,
or
necessary to make the statements therein, in the light of the circumstances
in
which they were made, not misleading. The term “best efforts” shall mean, among
other things, that the Company shall submit to the SEC, within four (4) Business
Days after the later of the date that (i) Company learns that no review of
a
particular Registration Statement will be made by the staff of the SEC or that
the staff has no further comments on the Registration Statement, as the case
may
be, and (ii) the approval of Legal Counsel pursuant to Section 3(c) (which
approval is immediately sought), a request for acceleration of effectiveness
of
such Registration Statement to a time and date not later than 48 hours after
the
submission of such request.
b. The
Company shall prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to a Registration Statement and
the
prospectus used in connection with such Registration Statement, which prospectus
is to be filed pursuant to Rule 424 promulgated under the 1933 Act, as may
be
necessary to keep such Registration Statement effective at all times during
the
Registration Period, subject to Allowable Grace Periods, and, during such
period, comply with the provisions of the 1933 Act with respect to the
disposition of all Registrable Securities of the Company covered by such
Registration Statement. In the case of amendments and supplements to a
Registration Statement which are required to be filed pursuant to this Agreement
(including pursuant to this Section 3(b)) by reason of the Company filing a
report on Form 10-K or 10-KSB, as applicable, Form 10-Q or 10-QSB, as
applicable, or Form 8-K or any analogous report under the Securities Exchange
Act of
1934,
as
amended (the “1934
Act”),
the
Company shall have incorporated such report by reference into such Registration
Statement, if applicable, or shall file such amendments or supplements with
the
SEC on the same day on which the 1934 Act report is filed which created the
requirement for the Company to amend or supplement such Registration
Statement.
c. The
Company shall (A) permit Legal Counsel to review and comment upon (i) a
Registration Statement at least five (5) Business Days prior to its filing
with
the SEC and (ii) all amendments and supplements to all Registration Statements
(except for reports incorporated by reference therein) within a reasonable
number of days prior to their filing with the SEC, and (B) not file any
Registration Statement or amendment or supplement thereto in a form to which
Legal Counsel reasonably objects. The Company shall not submit a request for
acceleration of the effectiveness of a Registration Statement or any amendment
or supplement thereto without the prior approval of Legal Counsel, which consent
shall not be unreasonably withheld. The Company shall furnish to Legal Counsel,
without charge, (i) copies of any correspondence from the SEC or the staff
of
the SEC to the Company or its representatives relating to any Registration
Statement, (ii) promptly after the same is prepared and filed with the SEC,
one
copy of any Registration Statement and any amendment(s) thereto, including
financial statements and schedules, all documents incorporated therein by
reference, if requested by an Investor, and all exhibits and (iii) upon the
effectiveness of any Registration Statement, one copy of the prospectus included
in such Registration Statement and all amendments and supplements thereto.
The
Company shall reasonably cooperate with Legal Counsel in performing the
Company’s obligations pursuant to this Section 3.
d. The
Company shall furnish to each Investor whose Registrable Securities are included
in any Registration Statement, without charge, (i) promptly after the same
is
prepared and filed with the SEC, at least one copy of such Registration
Statement and any amendment(s) thereto, including financial statements and
schedules, all documents incorporated therein by reference, if requested by
an
Investor, all exhibits and each preliminary prospectus, (ii) upon the
effectiveness of any Registration Statement, ten (10) copies of the prospectus
included in such Registration Statement and all amendments and supplements
thereto (or such other number of copies as such Investor may reasonably request)
and (iii) such other documents, including copies of any preliminary or final
prospectus, as such Investor may reasonably request from time to time in order
to facilitate the disposition of the Registrable Securities owned by such
Investor.
e. The
Company shall use its reasonable best efforts to (i) register and qualify,
unless an exemption from registration and qualification applies, the resale
by
Investors of the Registrable Securities covered by a Registration Statement
under such other securities or “blue sky” laws of all applicable jurisdictions
in the United States, (ii) prepare and file in those jurisdictions, such
amendments (including post-effective amendments) and supplements to such
registrations and qualifications as may be necessary to maintain the
effectiveness thereof during the Registration Period, (iii) take such other
actions as may be necessary to maintain such registrations and qualifications
in
effect at all times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable Securities
for sale in such jurisdictions; provided, however, that the Company shall not
be
required in connection therewith or as a condition thereto to (x) qualify to
do
business in any jurisdiction where it would
not
otherwise be required to qualify but for this Section 3(e), (y) subject
itself to general taxation in any such jurisdiction, or (z) file a general
consent to service of process in any such jurisdiction. The Company shall
promptly notify Legal Counsel and each Investor who holds Registrable Securities
of the receipt by the Company of any notification with respect to the suspension
of the registration or qualification of any of the Registrable Securities for
sale under the securities or “blue sky” laws of any jurisdiction in the United
States or its receipt of actual notice of the initiation or threatening of
any
proceeding for such purpose.
f. The
Company shall notify Legal Counsel and each Investor in writing, of the
happening of any event, as promptly as practicable after becoming aware of
such
event, as a result of which the prospectus included in a Registration Statement,
as then in effect, (1) includes an untrue statement of a material fact or
omission to state a material fact required to be stated therein or necessary
to
make the statements therein, in light of the circumstances under which they
were
made, not misleading (provided that in no event shall such notice contain any
material, nonpublic information) or (2) otherwise fails to comply with then
current law or the rules and regulations of the SEC or other applicable
regulatory body, and, subject to Section 3(r), promptly prepare a
supplement or amendment to such Registration Statement to correct such untrue
statement or omission, and deliver ten (10) copies of such supplement or
amendment to Legal Counsel and each Investor (or such other number of copies
as
Legal Counsel or such Investor may reasonably request). The Company shall also
promptly notify Legal Counsel and each Investor in writing, (i) when a
prospectus or any prospectus supplement or post-effective amendment has been
filed, and when a Registration Statement or any post-effective amendment has
become effective (notification of such effectiveness shall be delivered to
Legal
Counsel and each Investor by facsimile or e-mail on the same day of such
effectiveness and by overnight mail), (ii) of any request by the SEC for
amendments or supplements to a Registration Statement or related prospectus
or
related information, and (iii) of the Company’s reasonable determination that a
post-effective amendment to a Registration Statement would be
appropriate.
g. The
Company shall use its reasonable best efforts to prevent the issuance of any
stop order or other suspension of effectiveness of a Registration Statement,
or
the suspension of the qualification of any of the Registrable Securities for
sale in any jurisdiction and, if such an order or suspension is issued, to
obtain the withdrawal of such order or suspension at the earliest possible
moment and to notify Legal Counsel and each Investor who holds Registrable
Securities being sold of the issuance of such order and the resolution thereof
or its receipt of actual notice of the initiation or threat of any proceeding
for such purpose.
h. If
any
Investor is required under applicable securities law to be described in the
Registration Statement as an underwriter, at the reasonable request of any
Investor, the Company shall furnish to such Investor, on the date of the
effectiveness of the Registration Statement and thereafter from time to time
on
such dates as an Investor may reasonably request (i) a letter, dated such date,
from the Company’s independent certified public accountants in form and
substance as is customarily given by independent certified public accountants
to
underwriters in an underwritten public offering, addressed to the Investors,
and
(ii) an opinion, dated as of such date, of counsel representing the Company
for
purposes of such Registration Statement, in form, scope and substance as is
customarily given in an underwritten public offering, addressed to the
Investors.
i. The
Company shall make available for inspection by (i) any Investor, (ii) Legal
Counsel and (iii) one firm of accountants or other agents retained by the
Investors (collectively, the “Inspectors”),
all
pertinent financial and other records, and pertinent corporate documents and
properties of the Company (collectively, the “Records”),
as
shall be necessary and reasonably requested by each Inspector, and cause the
Company’s officers, directors and employees, counsel and the Company’s
independent certified public accountants to supply all information which may
be
necessary and any Inspector may reasonably request; provided, however, that
each
Inspector shall agree to hold in strict confidence and shall not make any
disclosure (except to an Investor) or use of any Record or other information
which the Company determines in good faith to be confidential, and of which
determination the Inspectors are so notified, and such inspector executes any
non-disclosure, non-use or similar document which may be reasonably required
by
Company, its independent certified public accountants or its counsel (and upon
execution of which the Company shall not be deemed to be in violation of its
agreement not to provide to such Investor any material, nonpublic information
or
to publicly disclose such information) unless (a) the disclosure of such Records
is necessary to avoid or correct a misstatement or omission in any Registration
Statement or is otherwise required under the 1933 Act, (b) the release of such
Records is ordered pursuant to a final, non-appealable subpoena or order from
a
court or government body of competent jurisdiction, or (c) the information
in
such Records has been made generally available to the public other than by
disclosure in violation of this or any other agreement of which the Inspector
has knowledge. Each Investor agrees that it shall, upon learning that disclosure
of such Records is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and
allow
the Company, at its expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, the Records deemed
confidential. Nothing herein (or in any other confidentiality agreement between
the Company and any Investor) shall be deemed to limit the Investors’ ability to
sell Registrable Securities in a manner which is otherwise consistent with
applicable laws and regulations.
j. The
Company shall hold in confidence and not make any disclosure of information
concerning an Investor provided to the Company unless (i) disclosure of such
information is necessary to comply with federal or state securities laws, (ii)
the disclosure of such information is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (iii) the release of
such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to
the
public other than by disclosure in violation of this Agreement or any other
agreement of which the Company has knowledge. The Company agrees that it shall,
upon learning that disclosure of such information concerning an Investor is
sought in or by a court or governmental body of competent jurisdiction or
through other means, give prompt written notice to such Investor and allow
such
Investor, at the Investor’s expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, such
information.
k. The
Company shall use its reasonable best efforts either to (i) cause all the
Registrable Securities covered by a Registration Statement to be listed on
each
securities exchange on which securities of the same class or series issued
by
the Company are then listed, if any, if the listing of such Registrable
Securities is then permitted under the rules of such exchange, or (ii) secure
designation and quotation of all the Registrable Securities covered by
the
Registration
Statement on the Nasdaq Global Market, or (iii) if, despite the Company’s best
efforts to satisfy the preceding clause (i) or (ii), the Company is unsuccessful
in satisfying the preceding clause (i) or (ii), to secure the inclusion for
quotation on The Nasdaq Capital Market for such Registrable Securities and,
without limiting the generality of the foregoing, to use its best efforts to
arrange for at least two market makers to register with the National Association
of Securities Dealers, Inc. (“NASD”)
as
such with respect to such Registrable Securities. The Company shall pay all
fees
and expenses in connection with satisfying its obligation under this Section
3(k).
l. The
Company shall cooperate with the Investors who hold Registrable Securities
being
offered and, to the extent applicable, facilitate the timely preparation and
delivery of certificates (not bearing any restrictive legend) , if applicable,
representing the Registrable Securities to be offered pursuant to a Registration
Statement and enable such certificates to be in such denominations or amounts,
as the case may be, as the Investors may reasonably request and registered
in
such names as the Investors may request.
m. If
reasonably requested by an Investor, the Company shall as soon as reasonably
practicable (i) incorporate in a prospectus supplement or post-effective
amendment such information as an Investor reasonably requests to be included
therein relating to the sale and distribution of Registrable Securities,
including, without limitation, information with respect to the number of
Registrable Securities being offered or sold, the purchase price being paid
therefor and any other terms of the offering of the Registrable Securities
to be
sold in such offering; and (ii) make all required filings of such prospectus
supplement or post-effective amendment after being notified of the matters
to be
incorporated in such prospectus supplement or post-effective amendment if
reasonably requested by an Investor holding any Registrable
Securities.
n. The
Company shall use its reasonable best efforts to cause the Registrable
Securities covered by the Registration Statement to be registered with or
approved by such other governmental agencies or authorities as may be necessary
to consummate the disposition of such Registrable Securities.
o. The
Company shall make generally available to its security holders as soon as
practical, but not later than one hundred eighty (180) days after the close
of
the period covered thereby, an earnings statement (in form complying with the
provisions of Rule 158 under the 1933 Act) covering a twelve-month period
beginning not later than the first day of the Company’s fiscal quarter next
following the effective date of the Registration Statement.
p. The
Company shall otherwise use its best efforts to comply with all applicable
rules
and regulations of the SEC in connection with any registration
hereunder.
q. Within
three (3) Business Days after a Registration Statement which covers Registrable
Securities is ordered effective by the SEC, the Company shall deliver, and
shall
cause legal counsel for the Company to deliver, to the transfer agent for such
Registrable Securities (with copies to the Investors whose Registrable
Securities are included in such Registration Statement) confirmation that such
Registration Statement has been declared effective by the SEC substantially
in
the form attached hereto as Exhibit
A.
r. Notwithstanding
anything to the contrary herein, the Company may delay, including by delaying
the effectiveness of a Registration Statement or the filing of a Registration
Statement or an amendment (including a post-effective amendment) or supplement
to a Registration Statement, the disclosure of material, nonpublic information
concerning the Company the disclosure of which at the time is not, in the good
faith opinion of the Board of Directors of the Company and its counsel, in
the
best interest of the Company and, in the opinion of counsel to the Company,
otherwise required (a “Grace
Period”)
and,
as applicable, suspend sales of Registered Securities under an effective
Registration Statement; provided,
that
the Company shall promptly (i) notify the Investors in writing of the existence
of material, nonpublic information giving rise to a Grace Period (provided
that
in each notice the Company will not disclose the content of such material,
nonpublic information to the Investors) and the date on which the Grace Period
will begin, and (ii) notify the Investors in writing of the date on which the
Grace Period ends; and, provided further,
that no
Grace Period shall exceed 15 consecutive days and during any 365 day period
such
Grace Periods shall not exceed an aggregate of 45 days and the first day of
any
Grace Period must be at least 2 Trading Days after the last day of any prior
Grace Period (an “Allowable
Grace Period”).
For
purposes of determining the length of a Grace Period above, the Grace Period
shall begin on and include the date the holders receive the notice referred
to
in clause (i) and shall end on and include the later of the date the holders
receive the notice referred to in clause (ii) and the date referred to in such
notice. The provisions of Sections 2(g) and 3(e) hereof shall not be applicable
during the period of any Allowable Grace Period. Upon expiration of the Grace
Period, the Company shall again be bound by the first sentence of
Section 3(f) with respect to the information giving rise thereto unless
such material nonpublic information is no longer applicable. Notwithstanding
anything to the contrary, the Company shall cause its transfer agent to deliver
unlegended certificates, if applicable, for ADSs to a transferee of an Investor
in accordance with the terms of the Securities Purchase Agreement in connection
with any sale of Registrable Securities with respect to which an Investor has
entered into a contract for sale, and delivered a copy of the prospectus
included as part of the applicable Registration Statement, prior to the
Investor’s receipt of the notice of a Grace Period and for which the Investor
has not yet settled.
s. Notwithstanding
anything to the contrary herein, the Company may suspend trading of its equity
securities on the applicable Eligible Market on which its equity securities
are
then trading, due to the existence of material, nonpublic information concerning
the Company the disclosure of which at the time is not, in the good faith
opinion of the Board of Directors of the Company and its counsel, in the best
interest of the Company (a “Trading
Grace Period”);
provided, that the Company shall promptly (i) notify the Investors in writing
of
the existence of such suspension (provided that in each notice the Company
will
not disclose the content of any material, nonpublic information to the
Investors) and the date on which the Trading Grace Period will begin, and (ii)
notify the Investors in writing of the date on which the Trading Grace Period
ends; and, provided further, that no Trading Grace Period shall exceed 5
consecutive days and during any 365 day period such Trading Grace Periods shall
not exceed an aggregate of 15 days and the first day of any Trading Grace Period
must be at least 2 Trading Days after the last day of any prior Trading Grace
Period (an “Allowable
Grace Trading Period”).
For
purposes of determining the length of a Trading Grace Period above, the Trading
Grace Period shall begin on and include the date the holders receive the notice
referred to in clause (i) and shall end on and include the later of the date
the
holders receive the notice referred
to
in
clause (ii) and the date referred to in such notice. The provisions of Sections
2(g) and 3(e) hereof shall not be applicable during the period of any Allowable
Trading Grace Period.
4. Obligations
of the Investors.
a. At
least
five (5) Business Days prior to the first anticipated filing date of a
Registration Statement, the Company shall notify each Investor in writing of
the
information the Company requires from each such Investor if such Investor elects
to have any of such Investor’s Registrable Securities included in such
Registration Statement. It shall be a condition precedent to the obligations
of
the Company to complete the registration pursuant to this Agreement with respect
to the Registrable Securities of a particular Investor that such Investor shall
furnish to the Company such information regarding itself, the Registrable
Securities held by it and the intended method of disposition of the Registrable
Securities held by it, as shall be reasonably required to effect and maintain
the effectiveness of the registration of such Registrable Securities and shall
execute such documents in connection with such registration as the Company
may
reasonably request.
b. Each
Investor, by such Investor’s acceptance of the Registrable Securities, agrees to
cooperate with the Company as reasonably requested by the Company in connection
with the preparation and filing of any Registration Statement hereunder, unless
such Investor has notified the Company in writing of such Investor’s election to
exclude all of such Investor’s Registrable Securities from such Registration
Statement.
c. Each
Investor agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 3(g) or the first
sentence of Section 3(f), such Investor will immediately discontinue
disposition of Registrable Securities pursuant to any Registration Statement(s)
covering such Registrable Securities until such Investor’s receipt of the copies
of the supplemented or amended prospectus contemplated by Section 3(g) or
the first sentence of Section 3(f) or receipt of notice that no supplement
or amendment is required. Notwithstanding anything to the contrary, the Company
shall cause its transfer agent to deliver unlegended certificates, if
applicable, for ADSs to a transferee of an Investor in accordance with the
terms
of the Securities Purchase Agreement in connection with any sale of Registrable
Securities with respect to which an Investor has entered into a contract for
sale prior to the Investor’s receipt of a notice from the Company of the
happening of any event of the kind described in Section 3(g) or the first
sentence of Section 3(f) and for which the Investor has not yet
settled.
d. Each
Investor covenants and agrees that it will comply with the prospectus delivery
requirements of the 1933 Act as applicable to it in connection with sales of
Registrable Securities pursuant to a Registration Statement.
5. Expenses
Of Registration.
All
reasonable expenses, other than underwriting discounts and commissions, incurred
in connection with registrations, filings or qualifications pursuant to Sections
2 and 3, including, without limitation, all registration, listing and
qualifications fees, printers and
accounting
fees, and fees and disbursements of counsel for the Company shall be paid by
the
Company. The Company shall also reimburse Castlerigg Master Investments Ltd.
for
the fees and disbursements of Legal Counsel incurred in connection with
registrations, filings or qualifications pursuant to Sections 2 and 3 of this
Agreement which amount shall be limited to $10,000 in the
aggregate.
6. Indemnification.
In
the
event any Registrable Securities are included in a Registration Statement under
this Agreement:
a. To
the
fullest extent permitted by law, the Company will, and hereby does, indemnify,
hold harmless and defend each Investor, the directors, officers, partners,
members, employees, agents, representatives of, and each Person, if any, who
controls any Investor within the meaning of the 1933 Act or the 1934 Act (each,
an “Indemnified
Person”),
against any losses, claims, damages, liabilities, judgments, fines, penalties,
charges, costs, reasonable attorneys’ fees, amounts paid in settlement or
expenses, joint or several, (collectively, “Claims”)
incurred in investigating, preparing or defending any action, claim, suit,
inquiry, proceeding, investigation or appeal taken from the foregoing by or
before any court or governmental, administrative or other regulatory agency,
body or the SEC, whether pending or threatened, whether or not an indemnified
party is or may be a party thereto (“Indemnified
Damages”),
to
which any of them may become subject insofar as such Claims (or actions or
proceedings, whether commenced or threatened, in respect thereof) arise out
of
or are based upon: (i) any untrue statement or alleged untrue statement of
a
material fact in a Registration Statement or any post-effective amendment
thereto or in any filing made in connection with the qualification of the
offering under the securities or other “blue sky” laws of any jurisdiction in
which Registrable Securities are offered (“Blue
Sky Filing”),
or
the omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, (ii) any
untrue statement or alleged untrue statement of a material fact contained in
any
preliminary prospectus if used prior to the effective date of such Registration
Statement, or contained in the final prospectus (as amended or supplemented,
if
the Company files any amendment thereof or supplement thereto with the SEC)
or
the omission or alleged omission to state therein any material fact necessary
to
make the statements made therein, in light of the circumstances under which
the
statements therein were made, not misleading, (iii) any violation or alleged
violation by the Company of the 1933 Act, the 1934 Act, any other law,
including, without limitation, any state securities law, or any rule or
regulation thereunder relating to the offer or sale of the Registrable
Securities pursuant to a Registration Statement or (iv) any material violation
of this Agreement (the matters in the foregoing clauses (i) through (iv) being,
collectively, “Violations”).
Subject to Section 6(c), the Company shall reimburse the Indemnified Persons,
promptly as such expenses are incurred and are due and payable, for any legal
fees or other reasonable expenses incurred by them in connection with
investigating or defending any such Claim. Notwithstanding anything to the
contrary contained herein, the indemnification agreement contained in this
Section 6(a): (i) shall not apply to a Claim by an Indemnified Person arising
out of or based upon a Violation which occurs in reliance upon and in conformity
with information furnished in writing to the Company by such Indemnified Person
for such Indemnified Person expressly for use in connection with the preparation
of the Registration Statement or any such amendment thereof or supplement
thereto, if such prospectus
was
timely made available by the Company pursuant to Section 3(d); (ii) shall not
be
available to the extent such Claim is based on a failure of the Investor to
deliver or to cause to be delivered the prospectus made available by the
Company, including a corrected prospectus, if such prospectus or corrected
prospectus was timely made available by the Company pursuant to Section 3(d);
and (iii) shall not apply to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which
consent shall not be unreasonably withheld or delayed. Such indemnity shall
remain in full force and effect regardless of any investigation made by or
on
behalf of the Indemnified Person and shall survive the transfer of the
Registrable Securities by the Investors pursuant to Section 9.
b. In
connection with any Registration Statement in which an Investor is
participating, each such Investor agrees to severally and not jointly indemnify,
hold harmless and defend, to the same extent and in the same manner as is set
forth in Section 6(a), the Company, each of its directors, each of its officers
who signs the Registration Statement and each Person, if any, who controls
the
Company within the meaning of the 1933 Act or the 1934 Act (each, an
“Indemnified
Party”),
against any Claim or Indemnified Damages to which any of them may become
subject, under the 1933 Act, the 1934 Act or otherwise, insofar as such Claim
or
Indemnified Damages arise out of or are based upon any Violation, in each case
to the extent, and only to the extent, that such Violation occurs in reliance
upon and in conformity with written information furnished to the Company by
such
Investor expressly for use in connection with such Registration Statement;
and,
subject to Section 6(c), such Investor will reimburse any legal or other
expenses reasonably incurred by an Indemnified Party in connection with
investigating or defending any such Claim; provided, however, that the indemnity
agreement contained in this Section 6(b) and the agreement with respect to
contribution contained in Section 7 shall not apply to amounts paid in
settlement of any Claim if such settlement is effected without the prior written
consent of such Investor, which consent shall not be unreasonably withheld
or
delayed; provided, further, however, that the Investor shall be liable under
this Section 6(b) for only that amount of a Claim or Indemnified Damages as
does
not exceed the net proceeds to such Investor as a result of the sale of
Registrable Securities pursuant to such Registration Statement. Such indemnity
shall remain in full force and effect regardless of any investigation made
by or
on behalf of such Indemnified Party and shall survive the transfer of the
Registrable Securities by the Investors pursuant to Section 9. Notwithstanding
anything to the contrary contained herein, the indemnification agreement
contained in this Section 6(b) with respect to any preliminary prospectus shall
not inure to the benefit of any Indemnified Party if the untrue statement or
omission of material fact contained in the preliminary prospectus was corrected
on a timely basis in the prospectus, as then amended or
supplemented.
c. Promptly
after receipt by an Indemnified Person or Indemnified Party under this Section
6
of notice of the commencement of any action or proceeding (including any
governmental action or proceeding) involving a Claim, such Indemnified Person
or
Indemnified Party shall, if a Claim in respect thereof is to be made against
any
indemnifying party under this Section 6, deliver to the indemnifying party
a
written notice of the commencement thereof, and the indemnifying party shall
have the right to participate in, and, to the extent the indemnifying party
so
desires, jointly with any other indemnifying party similarly noticed, to assume
control of the defense thereof with counsel mutually satisfactory to the
indemnifying party and the Indemnified Person or the Indemnified Party, as
the
case may be; provided, however, that an Indemnified Person or Indemnified Party
shall have the right to retain its own counsel with the
fees
and
expenses of not more than one counsel for such Indemnified Person or Indemnified
Party to be paid by the indemnifying party, if, in the reasonable opinion of
counsel retained by the indemnifying party, the representation by such counsel
of the Indemnified Person or Indemnified Party and the indemnifying party would
be inappropriate due to actual or potential differing interests between such
Indemnified Person or Indemnified Party and any other party represented by
such
counsel in such proceeding. In the case of an Indemnified Person, legal counsel
referred to in the immediately preceding sentence shall be selected by the
Required Holders to which the Claim relates. The Indemnified Party or
Indemnified Person shall cooperate reasonably with the indemnifying party in
connection with any negotiation or defense of any such action or Claim by the
indemnifying party and shall furnish to the indemnifying party all information
reasonably available to the Indemnified Party or Indemnified Person which
relates to such action or Claim. The indemnifying party shall keep the
Indemnified Party or Indemnified Person fully apprised at all times as to the
status of the defense or any settlement negotiations with respect thereto.
No
indemnifying party shall be liable for any settlement of any action, claim
or
proceeding effected without its prior written consent, provided, however, that
the indemnifying party shall not unreasonably withhold, delay or condition
its
consent. No indemnifying party shall, without the prior written consent of
the
Indemnified Party or Indemnified Person, consent to entry of any judgment or
enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party or Indemnified Person of a release from all liability in
respect to such Claim or litigation. Following indemnification as provided
for
hereunder, the indemnifying party shall be subrogated to all rights of the
Indemnified Party or Indemnified Person with respect to all third parties,
firms
or corporations relating to the matter for which indemnification has been made.
The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not relieve such
indemnifying party of any liability to the Indemnified Person or Indemnified
Party under this Section 6, except to the extent that the indemnifying party
is
prejudiced in its ability to defend such action.
d. The
indemnification required by this Section 6 shall be made by periodic payments
of
the amount thereof during the course of the investigation or defense, as and
when Indemnified Damages are incurred and applicable bills are
received.
e. The
indemnity agreements contained herein shall be in addition to (i) any cause
of
action or similar right of the Indemnified Party or Indemnified Person against
the indemnifying party or others, and (ii) any liabilities the indemnifying
party may be subject to pursuant to the law.
f. Nothing
herein shall the right of any party to this Agreement to bring a contractual
claim against any other party to this Agreement for a breach of this
Agreement.
7. Contribution.
To
the
extent any indemnification by an indemnifying party is prohibited or limited
by
law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 6 to the
fullest extent permitted by law; provided, however, that: (i) no person involved
in the sale of Registrable
Securities
which person is guilty of fraudulent misrepresentation (within the meaning
of
Section 11(f) of the 1933 Act) in connection with such sale shall be
entitled to contribution from any person involved in such sale of Registrable
Securities who was not guilty of fraudulent misrepresentation; and (ii)
contribution by any seller of Registrable Securities shall be limited in amount
to the net amount of proceeds received by such seller from the sale of such
Registrable Securities pursuant to such Registration Statement.
8. Reports
Under The 1934 Act.
Until
the
date on which (A) the Investors shall have sold all the Conversion Shares and
the Warrant Shares and (B) none of the Notes or Warrants is outstanding, with
a
view to making available to the Investors the benefits of Rule 144 promulgated
under the 1933 Act or any other similar rule or regulation of the SEC that
may
at any time permit the Investors to sell securities of the Company to the public
without registration (“Rule
144”),
the
Company agrees to:
a. make
and
keep public information available, as those terms are understood and defined
in
Rule 144;
b. file
with
the SEC in a timely manner all reports and other documents required of the
Company under the 1933 Act and the 1934 Act so long as the Company remains
subject to such requirements (it being understood that nothing herein shall
limit the Company’s obligations under Section 4(c) of the Securities Purchase
Agreement) and the filing of such reports and other documents is required for
the applicable provisions of Rule 144; and
c. furnish
to each Investor so long as such Investor owns Registrable Securities, promptly
upon request, (i) a written statement by the Company, if true, that it has
complied with the reporting requirements of Rule 144, the 1933 Act and the
1934
Act, (ii) a copy of the most recent annual or quarterly report of the Company
and such other reports and documents so filed by the Company, to the extent
not
available on EDGAR, and (iii) such other information as may be reasonably
requested to permit the Investors to sell such securities pursuant to Rule
144
without registration.
9. Assignment
of Registration Rights.
The
rights under this Agreement shall be automatically assignable by the Investors
to any transferee of Registrable Securities if: (i) the Investor agrees in
writing with the transferee or assignee to assign such rights, and a copy of
such agreement is furnished to the Company within three (3) Business Days after
such assignment; (ii) the Company is, within three (3) Business Days after
such
transfer or assignment, furnished with written notice of (a) the name and
address of such transferee or assignee, and (b) the securities with respect
to
which such registration rights are being transferred or assigned; (iii)
immediately following such transfer or assignment the further disposition of
such securities by the transferee or assignee is restricted under the 1933
Act
and applicable state securities laws; (iv) at or before the time the Company
receives the written notice contemplated by clause (ii) of this sentence the
transferee or assignee agrees in writing with the Company to be bound by all
of
the provisions contained herein; and
(v)
such
transfer shall have been made in accordance with the applicable requirements
of
the Securities Purchase Agreement.
10. Amendment
of Registration Rights.
Provisions
of this Agreement may be amended and the observance thereof may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Required
Holders. Any amendment or waiver effected in accordance with this Section 10
shall be binding upon each Investor and the Company. No such amendment shall
be
effective to the extent that it applies to less than all of the holders of
the
Registrable Securities. No consideration shall be offered or paid to any Person
to amend or consent to a waiver or modification of any provision of any of
this
Agreement unless the same consideration also is offered to all of the parties
to
this Agreement.
11. Miscellaneous.
a. A
Person
is deemed to be a holder of Registrable Securities whenever such Person owns
or
is deemed to own of record such Registrable Securities. If the Company receives
conflicting instructions, notices or elections from two or more Persons with
respect to the same Registrable Securities, the Company shall act upon the
basis
of instructions, notice or election received from the such record owner of
such
Registrable Securities.
b. Any
notices, consents, waivers or other communications required or permitted to
be
given under the terms of this Agreement must be in writing and will be deemed
to
have been delivered: (i) upon receipt, when delivered personally; (ii) upon
receipt, when sent by facsimile (provided confirmation of transmission is
mechanically or electronically generated and kept on file by the sending party);
or (iii) one Business Day after deposit with a nationally recognized overnight
delivery service, in each case properly addressed to the party to receive the
same. The addresses and facsimile numbers for such communications shall
be:
If
to the
Company:
pSivida
Limited
400
Pleasant Street
Watertown,
MA 02472
U.S.A
Telephone:
(617)
972-6278
Facsimile:
(617)
812-2400
Attention:
General
Counsel
With
a
copy (which shall not constitute notice) to:
Curtis,
Mallet-Prevost, Colt & Mosle LLP
101
Park
Avenue
New
York,
N.Y. 10178
U.S.A.
Telephone:
212-696-6000
Facsimile:
212-697-1559
Attention:
Lawrence
Goodman, Esq.
If
to
Legal Counsel:
Schulte
Roth & Zabel LLP
919
Third
Avenue
New
York,
New York 10022
Telephone:
(212)
756-2000
Facsimile:
(212)
593-5955
Attention:
Eleazer
Klein, Esq.
If
to a
Buyer, to its address and facsimile number set forth on the Schedule of Buyers
attached hereto, with copies to such Buyer’s representatives as set forth on the
Schedule of Buyers, or to such other address and/or facsimile number and/or
to
the attention of such other person as the recipient party has specified by
written notice given to each other party five (5) days prior to the
effectiveness of such change. Written confirmation of receipt (A) given by
the
recipient of such notice, consent, waiver or other communication, (B)
mechanically or electronically generated by the sender’s facsimile machine
containing the time, date, recipient facsimile number and an image of the first
page of such transmission or (C) provided by a courier or overnight courier
service shall be rebuttable evidence of personal service, receipt by facsimile
or receipt from a nationally recognized overnight delivery service in accordance
with clause (i), (ii) or (iii) above, respectively.
c. The
Company hereby irrevocably appoints pSivida Inc., 400 Pleasant Street,
Watertown, MA 02472 ("pSivida
Inc.")
as its
agent for the receipt of service of process in the United States. The Company
agrees that any document may be effectively served on it in connection with
any
action, suit or proceeding in the United States by service on its agents. The
Buyers consent and agree that the Company may, in its reasonable discretion,
irrevocably appoint a substitute agent for the receipt of service of process
located within the Untied States, and that upon such appointment, the
appointment of pSivida Inc. may be revoked.
(1)
Any
document shall be deemed to have been duly served if marked for the attention
of
the agent at its address set forth above or such other address in the United
States as may be notified to the party wishing to serve the document and
(a) left at the specified address if its receipt is acknowledged in
writing; or (b) sent to the specified address by post, registered mail
return receipt requested. In the case of (a), the document will be deemed to
have been duly served when it is left and signed for. In the case of (b), the
document shall be deemed to have been duly served when received and
acknowledged.
(2)
If the
Company's agent at any time ceases for any reason to act as such, the Company
shall appoint a replacement agent having an address for service in the United
States and shall notify each Buyer of the name and address of the replacement
agent. Failing such appointment and notification, the Buyer shall be entitled
by
notice to the Company to appoint a replacement agent to act on the Company's
behalf. The provisions of this Section 11(c) applying to service on an agent
apply equally to service on a replacement agent.
d. Failure
of any party to exercise any right or remedy under this Agreement or otherwise,
or delay by a party in exercising such right or remedy, shall not operate as
a
waiver thereof.
e. All
questions concerning the construction, validity, enforcement and interpretation
of this Agreement shall be governed by the internal laws of the State of New
York, without giving effect to any choice of law or conflict of law provision
or
rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State
of
New York. Each party hereby irrevocably submits to the exclusive jurisdiction
of
the state and federal courts sitting The City of New York, Borough of Manhattan,
for the adjudication of any dispute hereunder or in connection herewith or
with
any transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that
the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof to
such
party at the address for such notices to it under this Agreement 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. If any provision of this
Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity
or unenforceability shall not affect the validity or enforceability of the
remainder of this Agreement in that jurisdiction or the validity or
enforceability of any provision of this Agreement in any other jurisdiction.
EACH
PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO
REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN
CONNECTION HEREWITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION
CONTEMPLATED HEREBY.
f. This
Agreement and the other Transaction Documents (as defined in the Second
Amendment Agreement) constitute the entire agreement among the parties hereto
with respect to the subject matter hereof and thereof. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein and therein. This Agreement and the other Transaction
Documents supersede all prior agreements and understandings among the parties
hereto with respect to the subject matter hereof and thereof.
g. Subject
to the requirements of Section 9, this Agreement shall inure to the benefit
of
and be binding upon the permitted successors and assigns of each of the parties
hereto.
h. The
headings in this Agreement are for convenience of reference only and shall
not
limit or otherwise affect the meaning hereof.
i. This
Agreement may be executed in identical counterparts, each of which shall be
deemed an original but all of which shall constitute one and the same agreement.
This Agreement, once executed by a party, may be delivered to the other party
hereto by facsimile transmission of a copy of this Agreement bearing the
signature of the party so delivering this Agreement.
j. Each
party shall do and perform, or cause to be done and performed, all such further
acts and things, and shall execute and deliver all such other agreements,
certificates, instruments and documents, as the other party may reasonably
request in order to carry out the intent and accomplish the purposes of this
Agreement and the consummation of the transactions contemplated
hereby.
k. All
consents and other determinations required to be made by the Investors pursuant
to this Agreement shall be made, unless otherwise specified in this Agreement,
by the Required Holders, determined as if all of the Warrants then outstanding
have been exercised for Registrable Securities without regard to any limitations
on exercises of the Warrants.
l. The
language used in this Agreement will be deemed to be the language chosen by
the
parties to express their mutual intent and no rules of strict construction
will
be applied against any party.
m. This
Agreement is intended for the benefit of the parties hereto and their respective
permitted successors and assigns, and is not for the benefit of, nor may any
provision hereof be enforced by, any other Person.
n. The
obligations of each Buyer hereunder are several and not joint with the
obligations of any other Buyer, and no provision of this Agreement is intended
to confer any obligations on any Buyer vis a vis any other Buyer. Nothing
contained herein, and no action taken by any Buyer pursuant hereto, shall be
deemed to constitute the Buyers as a partnership, an association, a joint
venture or any other kind of entity, or create a presumption that the Buyers
are
in any way acting in concert or as a group with respect to such obligations
or
the transactions contemplated herein.
[Signature
page follows.]
IN
WITNESS WHEREOF,
each
Buyer and the Company have caused their respective signature page to this
Registration Rights Agreement to be duly executed as of the date first written
above.
|
COMPANY:
|
| |
|
PSIVIDA
LIMITED
By:
/s/
Michael J. Soja
Name:
Michael
J. Soja
Title:
Vice
President, Finance and Chief Financial Officer
|
|
|
| |
| |
| BUYERS: |
| |
|
CASTLERIGG
MASTER INVESTMENTS LTD.
|
| |
|
By:
/s/
Timothy O’Brein
Name:
Timothy O’Brein
Title:
Chief Financial Officer
|
SCHEDULE
OF BUYERS
|
Buyer
|
|
Buyer
Address
and
Facsimile Number
|
|
Buyer’s
Representative’s Address
and
Facsimile Number
|
|
Castlerigg
Master Investments
|
|
c/o
Sandell Asset Management Corp.
40
West 57th
Street
26th
Floor
New
York, New York 10019
Attention:
Cem Hacioglu/Matthew Pliskin
Facsimile: (212)
603-5710
Telephone: (212)
603-5775
|
|
Schulte
Roth & Zabel LLP
919
Third Avenue
New
York, NY 10022
Attn:
Eleazer Klein, Esq.
Facsimile:
(212) 593-5955
Telephone:
(212) 756-2000
|
EXHIBIT
A
FORM
OF NOTICE OF EFFECTIVENESS
OF
REGISTRATION STATEMENT
Citibank,
N.A.
388
Greenwich Street, 14th Floor
New
York,
New York 10013
Attention: Paul
Martin
Ladies
and Gentlemen:
We
have
acted as special U.S. counsel to pSivida
Limited, an
Australian corporation (the “Company”),
in
connection with that certain Second Amended and Restated Amendment Agreement,
dated as of May 15, 2007 (the “Purchase
Agreement”),
entered into by and among the Company and the buyers named therein
(collectively, the “Buyers”),
pursuant to which the Company issued to the Buyers warrants (the “Warrants”)
exercisable for ADSs of the Company (the “Warrant
Shares”).
In
connection with the Purchase Agreement, the Company entered into a Second
Amended and Restated Registration Rights Agreement with the Buyers (the
“Registration
Rights Agreement”)
pursuant to which the Company agreed, among other things, to register under
the
Securities Act of 1933, as amended (the “1933
Act”)
the
resale of the Registrable Securities (as defined in the Registration Rights
Agreement), including, among other securities, the ADSs issuable upon exercise
of the Warrants. In connection with the Company’s obligations under the
Registration Rights Agreement, the Company filed a Registration Statement on
Form F-3 (File No. ___________________) (the “Registration
Statement”)
with
the Securities and Exchange Commission (the “SEC”)
relating to the Initial Registrable Securities which names each of the Buyers
as
a selling security holder thereunder (the “Selling
Security Holders”).
In
connection with the foregoing, we advise you that the SEC’s website indicates
that the SEC entered an order declaring the Registration Statement effective
under the 1933 Act at [ENTER TIME OF EFFECTIVENESS] on [ENTER DATE OF
EFFECTIVENESS], and we have no knowledge, after telephonic inquiry of a member
of the SEC’s staff, that any stop order suspending its effectiveness has been
issued or that any proceedings for that purpose are pending before, or
threatened by, the SEC, and that to our knowledge the Registrable Securities
are
available for resale under the 1933 Act pursuant to the Registration
Statement.
This
letter shall serve as our standing opinion to you that the ADSs are freely
transferable by the Selling Security Holders pursuant to the Registration
Statement. You need not require further letters from us to effect any future
legend-free issuance or reissuance of ADSs to the Selling Security Holders
as
contemplated by the Company’s Irrevocable Transfer Agent Instructions,
dated
May
15, 2007.
Very
truly yours,
[ISSUER’S
COUNSEL]
By:_____________________
CC: [LIST
NAMES OF HOLDERS]
EXHIBIT
B
SELLING
STOCKHOLDERS
The
ADSs
being offered by the selling stockholders are issuable (i) upon conversion
of
the convertible notes, (ii) as interest on the convertible notes and (iii)
upon
exercise of the warrants. For additional information regarding the notes and
warrants, see “Private Placement of Convertible Notes and Warrants” above. We
are registering the ADSs in order to permit the selling stockholders to offer
the ADSs for resale from time to time. Except for the ownership of the notes
and
the warrants, the selling stockholders have not had any material relationship
with us within the past three years.
The
table
below lists the selling stockholders and other information regarding the
beneficial ownership of the ordinary shares underlying the ADSs by each of
the
selling stockholders. The second column lists the number of ordinary shares
beneficially owned (directly or indirectly through ADSs) by each selling
stockholder, based on its ownership of the notes and the warrants, as of
________, 2007, assuming conversion of all the notes and exercise of all
warrants held by the selling stockholders on that date, without regard to any
limitations on conversions or exercise.
The
third
column lists the ordinary shares being offered by this prospectus by the selling
stockholders.
In
accordance with the terms of registration rights agreements with the holders
of
the notes and the warrants, this prospectus generally covers the resale of
at
least 130% of the sum of (i) the maximum number of ADSs issuable upon conversion
of the notes (assuming that the notes are convertible at their initial
Conversion Price and without taking into account any limitations on the
conversion of the notes set forth in such notes), (ii) the maximum number of
ADSs issuable upon exercise of the related warrants (without taking into account
any limitations on the exercise of the warrants set forth in the warrants)
and
(iii) as interest on the convertible notes, in each case as of the Trading
Day
immediately preceding the date this registration statement was initially filed
with the SEC. Because the conversion price of the notes and the exercise price
of the warrants may be adjusted, the number of ADSs that will actually be issued
may be more or less than the number of ADSs being offered by this prospectus.
The fourth column assumes the sale of all of the ADSs offered by the selling
stockholders pursuant to this prospectus.
Under
the
terms of the notes and the warrants, a selling stockholder may not convert
the
notes, or exercise the warrants, to the extent such conversion or exercise
would
cause such selling stockholder, together with its affiliates, to beneficially
own a number of ordinary shares (directly or indirectly through ADSs) which
would exceed 4.99% of our then outstanding ordinary shares following such
conversion or exercise, excluding for purposes of such determination ordinary
shares issuable upon conversion of the notes which have not been converted
and
upon exercise of the warrants which have not been exercised. The number of
shares in the second column does not reflect this limitation. The selling
stockholders may sell all, some or none of their ADSs in this offering. See
“Plan of Distribution.”
|
Name
of Selling Stockholder
|
|
Number
of ADSs Owned
Prior
to Offering
|
|
Maximum
Number of ADSs
to
be Sold
Pursuant
to this Prospectus
|
|
Number
of ADSs Owned
After
Offering
|
|
Castlerigg
Master Investments (1)
|
|
|
|
|
|
0
|
| (1) |
Sandell
Asset Management Corp. (“SAMC”) is the investment manager of Castlerigg
Master Investments Ltd. (“Master”). Thomas Sandell is the controlling
person of SAMC and may be deemed to share beneficial ownership of
the
shares beneficially owned by Master. Castlerigg International Ltd.
(“Castlerigg International”) is the controlling shareholder of Castlerigg
International Holdings Limited (“Holdings”). Holdings is the controlling
shareholder of Master. Each of Holdings and Castlerigg International
may
be deemed to share beneficial ownership of the shares beneficially
owned
by Castlerigg Master Investments. SAMC, Mr. Sandell, Holdings and
Castlerigg International each disclaims beneficial ownership of the
securities with respect to which indirect beneficial ownership is
described.
|
PLAN
OF DISTRIBUTION
We
are
registering the ADSs issuable upon conversion of the notes and upon exercise
of
the warrants and as interest on the convertible notes to permit the resale
of
these ADSs by the holders of the notes and the warrants from time to time after
the date of this prospectus. We will not receive any of the proceeds from the
sale by the selling stockholders of the ADSs. We will bear all fees and expenses
incident to our obligation to register the ADSs.
The
selling stockholders may sell all or a portion of the ADSs beneficially owned
by
them and offered hereby from time to time directly or through one or more
underwriters, broker-dealers or agents. If the ADSs are sold through
underwriters or broker-dealers, the selling stockholders will be responsible
for
underwriting discounts or commissions or agent’s commissions. The ADSs may be
sold in one or more transactions at fixed prices, at prevailing market prices
at
the time of the sale, at varying prices determined at the time of sale, or
at
negotiated prices. These sales may be effected in transactions, which may
involve crosses or block transactions,
|
·
|
on
any national securities exchange or quotation service on which the
securities may be listed or quoted at the time of
sale;
|
|
·
|
in
the over-the-counter market;
|
|
·
|
in
transactions otherwise than on these exchanges or systems or in the
over-the-counter market;
|
|
·
|
through
the writing of options, whether such options are listed on an options
exchange or otherwise;
|
|
·
|
ordinary
brokerage transactions and transactions in which the broker-dealer
solicits purchasers;
|
|
·
|
block
trades in which the broker-dealer will attempt to sell the ADSs
as
agent but may position and resell a portion of the block as principal
to
facilitate the transaction;
|
|
·
|
purchases
by a broker-dealer as principal and resale by the broker-dealer for
its
account;
|
|
·
|
an
exchange distribution in accordance with the rules of the applicable
exchange;
|
|
·
|
privately
negotiated transactions;
|
|
·
|
pursuant
to Rule 144 under the Securities
Act;
|
|
·
|
broker-dealers
may agree with the selling securityholders to sell a specified number
of
such ADSs
at
a stipulated price per ADR;
|
|
·
|
a
combination of any such methods of sale;
and
|
|
·
|
any
other method permitted pursuant to applicable
law.
|
If
the
selling stockholders effect such transactions by selling ADSs to or through
underwriters, broker-dealers or agents, such underwriters, broker-dealers or
agents may receive commissions in the form of discounts, concessions or
commissions from the selling stockholders or commissions from purchasers of
the
ADSs for whom they may act as agent or to whom they may sell as principal (which
discounts, concessions or commissions as to particular underwriters,
broker-dealers or agents may be in excess of those customary in the types of
transactions involved). In connection with sales of the ADSs or otherwise,
the
selling stockholders may enter into hedging transactions with broker-dealers,
which may in turn engage in short sales of the ADSs in the course of hedging
in
positions they assume. The selling stockholders may also sell ADSs short and
deliver ADSs covered by this prospectus to close out short positions. The
selling stockholders may also loan or pledge ADSs to broker-dealers that in
turn
may sell such ADSs.
The
selling stockholders may pledge or grant a security interest in some or all
of
the notes, warrants or the ADSs owned by them and, if they default in the
performance of their secured obligations, the pledgees or secured parties may
offer and sell the ADSs from time to time pursuant to this prospectus or any
amendment to this prospectus under Rule 424(b)(3) or other applicable provision
of the Securities Act of 1933, as amended, amending, if necessary, the list
of
selling stockholders to include the pledgee, transferee or other successors
in
interest as selling stockholders under this prospectus. The selling stockholders
also may transfer and donate the ADSs in other circumstances in which case
the
transferees, donees, pledgees or other successors in interest will be the
selling beneficial owners for purposes of this prospectus.
The
selling stockholders and any broker-dealer participating in the distribution
of
the ADSs may be deemed to be “underwriters” within the meaning of the Securities
Act, and any commission paid, or any discounts or concessions allowed to, any
such broker-dealer may be deemed to be underwriting commissions or discounts
under the Securities Act. At the time a particular offering of the ADSs is
made,
a prospectus supplement, if required, will be distributed which will set forth
the aggregate amount of ADSs being offered and the terms of the offering,
including the name or names of any broker-dealers or agents, any discounts,
commissions and other terms constituting compensation from the selling
stockholders and any discounts, commissions or concessions allowed or reallowed
or paid to broker-dealers.
Under
the
securities laws of some states, the ADSs may be sold in such states only through
registered or licensed brokers or dealers. In addition, in some states the
ADSs
may not be sold unless such ADSs have been registered or qualified for sale
in
such state or an exemption from registration or qualification is available
and
is complied with.
There
can
be no assurance that any selling stockholder will sell any or all of the ADSs
registered pursuant to the shelf registration statement, of which this
prospectus forms a part.
The
selling stockholders and any other person participating in such distribution
will be subject to applicable provisions of the Securities Exchange Act of
1934,
as amended, and the rules and regulations thereunder, including, without
limitation, Regulation M of the Exchange Act, which may limit the timing of
purchases and sales of any of the ADSs by the selling stockholders and any
other
participating person. Regulation M may also restrict the ability of any person
engaged in the distribution of the ADSs to engage in market-making activities
with respect to the ADSs. All of the foregoing may affect the marketability
of
the ADSs and the ability of any person or entity to engage in market-making
activities with respect to the ADSs.
We
will
pay all expenses of the registration of the ADSs pursuant to the registration
rights agreement, estimated to be $[ ] in total,
including, without limitation, Securities and Exchange Commission filing fees
and expenses of compliance with state securities or “blue sky” laws; provided,
however, that a selling stockholder will pay all underwriting discounts and
selling commissions, if any. We will indemnify the selling stockholders against
liabilities, including some liabilities under the Securities Act, in accordance
with the registration rights agreements, or the selling stockholders will be
entitled to contribution. We may be indemnified by the selling stockholders
against civil liabilities, including liabilities under the Securities Act,
that
may arise from any written information furnished to us by the selling
stockholder specifically for use in this prospectus, in accordance with the
related registration rights agreements, or we may be entitled to
contribution.
Once
sold
under the shelf registration statement, of which this prospectus forms a part,
the ADSs will be freely tradable in the hands of persons other than our
affiliates.
EX 99.4
EXHIBIT
99.4
SERIES
D WARRANT
NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR
THE
SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
(I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR (B) AN OPINION OF COUNSEL,
IN A
FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) IF SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT,
SUCH DOCUMENTS, OPINIONS AND CERTIFICATES AS THE COMPANY MAY REASONABLY REQUIRE.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION
WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY
THE
SECURITIES.
PSIVIDA
LIMITED
Series
D Warrant To Purchase ADRS
Warrant
No.: Series
D-1
Number
of
ADRs: 4,000,000
Date
of
Issuance: May
15, 2007 (“Issuance
Date”)
PSIVIDA
LIMITED, an Australian corporation (the “Company”),
hereby certifies that, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, CASTLERIGG MASTER INVESTMENTS
LTD., the registered holder hereof or its permitted assigns (the “Holder”),
is
entitled, subject to the terms set forth below, to purchase from the Company,
at
the Exercise Price (as defined below) then in effect, upon surrender of this
Warrant to Purchase ADRs (as defined below) (including any Warrants to Purchase
ADRs issued in exchange, transfer or replacement hereof, the “Warrant”),
at
any time or times on or after the date hereof, but not after 11:59 p.m., New
York Time, on the Expiration Date (as defined below), representing up to Four
Million (4,000,000) fully paid nonassessable ADRs (as defined below) (the
“Warrant
Shares”).
Except as otherwise defined herein, capitalized terms in this Warrant shall
have
the meanings set forth in Section 15. This Warrant is one of the Warrants to
purchase Warrant Shares (the “SPA
Warrants”)
issued
pursuant to Section 1 of that certain Amended and Restated Second Amendment
Agreement, dated as of May 15, 2007 (the “Subscription
Date”),
by
and among the Company and the investors (the “Buyers”)
referred to therein (the “Amendment
Agreement”).
1. EXERCISE
OF WARRANT.
(a) Mechanics
of Exercise.
Subject
to the terms and conditions hereof (including, without limitation, the
limitations set forth in Section 1(f)), this Warrant may be exercised by the
Holder on any day on or after the date hereof, in whole or in part, by
(i) delivery of a written notice, in the form attached hereto as
Exhibit
A
(the
“Exercise
Notice”),
of
the Holder’s election to exercise this Warrant and (ii) payment to the
Company of an amount equal to the applicable Exercise Price multiplied by the
number of Warrant Shares as to which this Warrant is being exercised (the
“Aggregate
Exercise Price”)
in
cash or wire transfer of immediately available funds. The Holder shall not
be
required to deliver the original Warrant in order to effect an exercise
hereunder. Execution and delivery of the Exercise Notice with respect to less
than all of the Warrant Shares shall have the same effect as cancellation of
the
original Warrant and issuance of a new Warrant evidencing the right to purchase
the remaining number of Warrant Shares. On or before the second (2nd) Business
Day following the date on which the Company has received each of the Exercise
Notice and the Aggregate Exercise Price the “Exercise
Delivery Documents”),
the
Company shall transmit by facsimile an acknowledgment of confirmation of receipt
of the Exercise Delivery Documents to the Holder and the Company’s transfer
agent (the “Transfer
Agent”).
On or
before the fifth (5th) Business Day following the date on which the Company
has
received all of the Exercise Delivery Documents (the “Share
Delivery Date”),
the
Company shall (X) provided that the Transfer Agent is participating in The
Depository Trust Company (“DTC”)
Fast
Automated Securities Transfer Program, upon the request of the Holder, credit
such aggregate number of Warrant Shares to which the Holder is entitled pursuant
to such exercise to the Holder’s or its designee’s balance account with DTC
through its Deposit Withdrawal Agent Commission system, or (Y) if the Transfer
Agent is not participating in the DTC Fast Automated Securities Transfer
Program, issue and dispatch by overnight courier to the address as specified
in
the Exercise Notice, a certificate, registered in the Company’s share register
in the name of the Holder or its designee, for the number of Warrant Shares
to
which the Holder is entitled pursuant to such exercise. Upon delivery of the
Exercise Delivery Documents, the Holder shall be deemed for all corporate
purposes to have become the holder of record of the Ordinary Shares represented
by the ADRs with respect to which this Warrant has been exercised, irrespective
of the date of delivery of the certificates evidencing the ADRs. If this Warrant
is submitted in connection with any exercise pursuant to this Section 1(a)
and
the number of Warrant Shares represented by this Warrant submitted for exercise
is greater than the number of Warrant Shares being acquired upon an exercise,
then the Company shall as soon as practicable and in no event later than three
Business Days after any exercise and at its own expense, issue a new Warrant
(in
accordance with Section 7(d)) representing the right to purchase the number
of
Warrant Shares purchasable immediately prior to such exercise under this
Warrant, less the number of Warrant Shares with respect to which this Warrant
is
exercised. No fractional Warrant Shares are to be issued upon the exercise
of
this Warrant, but, at the option of the Company, (i) the number of Warrant
Shares to be issued shall be rounded up to the nearest whole number or (ii)
in
lieu of any fractional Warrant Shares to which the Holder would otherwise be
entitled, the Company shall make a cash payment to the Holder equal to the
Closing Sale Price on the date of exercise multiplied by such fraction. Upon
exercise of this Warrant, the Company shall deposit the corresponding number
of
Ordinary Shares representing the American Depositary Shares (“ADSs”)
underlying the ADRs and pay by wire transfer to the Depositary’s account the ADS
issuance fee of $0.03 per ADS to be issued, together with all applicable
taxes
and
expenses otherwise payable under the terms of the Deposit Agreement for the
deposit of Ordinary Shares and issuance of ADSs (including, without limitation,
confirmation that any Australian stock transfer taxes in respect of such deposit
(if any) have been paid by the Company), and the Company shall otherwise comply
with and cause any other necessary party to comply with all the terms of the
Deposit Agreement. The Company shall pay any and all taxes (excluding any taxes
on the income of the Holder) which may be payable with respect to the issuance
and delivery of Warrant Shares upon exercise of this Warrant. Appropriate and
equitable adjustment to the terms and provisions of this Warrant shall be made
in the event of any change to the ratio of Warrant Shares to Ordinary Shares
represented thereby.
In
the
event that the Company’s Board of Directors should determine that the Company
shall transform itself (whether by re-incorporation in the United States or
otherwise) from a foreign private issuer (as defined under the Securities Act
of
1933, as amended) all references to ADRs or ADSs shall be deemed references
to
whatever shares are then issued by the re-domiciled Company and all other
provisions of this Warrant shall be equitably adjusted by the parties hereto
to
the extent necessary or appropriate to reflect such new country of
incorporation.
(b) Exercise
Price.
For
purposes of this Warrant, “Exercise
Price”
means
$2.00 per ADR (which is equivalent to $0.20 per Ordinary Share), subject to
adjustment as provided herein.
(c) Company’s
Failure to Timely Deliver Securities.
If the
Company shall fail to issue to the Holder, the number of Warrant Shares to
which
the Holder is entitled upon the Holder’s exercise of this Warrant and register
such Warrant Shares on the Company’s share register or to credit the Holder’s
balance account with DTC for such number of Warrant Shares to which the Holder
is entitled upon the Holder’s exercise of this Warrant on or prior to the date
which is three (3) Business Days after receipt of the Exercise Delivery
Documents (an “Exercise
Failure”),
then
the Company shall pay damages in cash to the Holder for each date of such
Exercise Failure in an amount equal to an interest rate equal to 10% per annum
applied to the product of (X) the sum of the number of Warrant Shares not issued
to the Holder on or prior to the Share Delivery Date and to which the Holder
is
entitled and (Y) the Closing Sale Price of the Warrant Shares on the Share
Delivery Date. In addition to the foregoing, if within three (3) Trading Days
after the Company’s receipt of the facsimile copy of a Exercise Notice the
Company shall fail to issue and deliver to the Holder and register such Warrant
Shares on the Company’s share register or credit the Holder’s balance account
with DTC for the number of Warrant Shares to which the Holder is entitled upon
such holder’s exercise hereunder, and if on or after such Trading Day the Holder
purchases (in an open market transaction or otherwise) ADRs to deliver in
satisfaction of a sale by the Holder of ADRs issuable upon such exercise that
the Holder anticipated receiving from the Company (a “Buy-In”),
then
the Company shall, within three (3) Business Days after the Holder’s request and
in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal
to the Holder’s total purchase price (including brokerage commissions, if any)
for the ADRs so purchased (the “Buy-In
Price”),
at
which point the Company’s obligation to deliver and issue such ADRs shall be
deemed to have been satisfied and shall terminate, or (ii) promptly honor its
obligation to deliver to the Holder a certificate or certificates representing
such ADRs and pay cash to the Holder in an amount equal to the excess
(if
any)
of the Buy-In Price over the product of (A) such number of ADRs, times (B)
the
Closing Bid Price on the date of exercise.
(d) Registration
Rights.
Notwithstanding
anything contained herein to the contrary, if a Registration Statement (as
defined in the Registration Rights Agreement) covering the Warrant Shares that
are the subject of the Exercise Notice (the “Unavailable
Warrant Shares”)
is not
available for resale of such Unavailable Warrant Shares then the Holder may
elect to exercise this Warrant for Warrant Shares in the form of ADRs or in
the
form of the Ordinary Shares underlying the ADRs and in either case the Company
must, contemporaneous with the issue of the Warrant Shares that are the subject
of the Exercise Notice, lodge with the ASX Limited a notice complying with
section 708A(5)(E) of the Corporations Act 2001 and the ASX Listing Rules
(“Cleansing
Notice”)
and
notify the Holder that it has so lodged a Cleansing Notice, and upon the
lodgement by the Company of the Cleansing Notice, the Holder is free to dispose
of any Ordinary Shares or any interest in Ordinary Shares it holds on the
Australian Stock Exchange Limited in the ordinary course of trading or otherwise
in Australia to any person and the restrictions on sale in that certain
Securities Purchase Agreement, dated as of October 5, 2005, by and among the
Company and the buyers listed on the Schedule of Buyers attached thereto, as
amended (the “Securities
Purchase Agreement”),
including without limitation in Section 2(j)(C) of the Securities Purchase
Agreement, does not apply to any such disposal. Notwithstanding the foregoing,
from after the second anniversary of the Issuance Date, in the event that the
aggregate number of Ordinary Shares that trades on the ASX is less than either
(i) an average of 50,000 Common Shares on each Trading Day during any two month
period or (ii) a weighted average trading price of at least US$50,000 on average
during each Trading Day during any two month period, then at the request of
the
Holder the Company as of the date of such request once again (each of (i) and
(ii), a “Registration
Event”)
shall
be subject to the terms of the Registration Rights Agreement as to the Warrant
Shares; provided, that the Holder makes such request within thirty (30) days
of
a Registration Event.
(e) Disputes.
In the
case of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall issue to the
Holder the number of Warrant Shares that are not disputed and resolve such
dispute in accordance with Section 12.
(f) Limitations
on Exercises.
(i) Beneficial
Ownership.
The
Company shall not effect the exercise of this Warrant, and the Holder shall
not
have the right to exercise this Warrant, to the extent that after giving effect
to such exercise, the Holder (together with affiliates) would beneficially
own
(directly or indirectly through Warrant Shares or otherwise) in excess of 4.99%
(the “Maximum
Percentage”)
of the
Ordinary Shares outstanding immediately after giving effect to such exercise.
For purposes of the foregoing sentence, the number of Ordinary Shares
beneficially owned (directly or indirectly through Warrant Shares or otherwise)
by the Holder and its affiliates shall include the number of Ordinary Shares
underlying the Warrant Shares issuable upon exercise of this Warrant with
respect to which the determination of such sentence is being made, but shall
exclude the number of Ordinary Shares underlying Warrant Shares which would
be
issuable upon (i) exercise of the remaining, unexercised portion of this
Warrant
beneficially
owned by the Holder and its affiliates and (ii) exercise or conversion of the
unexercised or unconverted portion of any other securities of the Company
beneficially owned by such Person and its affiliates (including, without
limitation, any convertible notes or convertible preferred stock or warrants)
subject to a limitation on conversion or exercise analogous to the limitation
contained herein. Except as set forth in the preceding sentence, for purposes
of
this section, beneficial ownership shall be calculated in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended. For purposes
of this Warrant, in determining the number of outstanding Ordinary Shares,
the
Holder may rely on the number of outstanding Ordinary Shares as reflected in
(1)
the Company’s most recent Form 20-F, Form 6-K or other public filing with the
Securities and Exchange Commission, as the case may be, (2) a more recent public
announcement by the Company or (3) any other notice by the Company or the
Transfer Agent setting forth the number of Ordinary Shares outstanding. For
any
reason at any time, upon the written or oral request of the Holder, the Company
shall within two (2) Business Days confirm orally and in writing to the Holder
the number of Ordinary Shares then outstanding. In any case, the number of
outstanding Ordinary Shares shall be determined after giving effect to the
conversion or exercise of securities of the Company, including the SPA
Securities and the SPA Warrants, by the Holder and its affiliates since the
date
as of which such number of outstanding Ordinary Shares was reported. By written
notice to the Company, the Holder may increase or decrease the Maximum
Percentage to any other percentage not in excess of 9.99% specified in such
notice; provided that (i) any such increase will not be effective until the
sixty-first (61st)
day
after such notice is delivered to the Company, and (ii) any such increase or
decrease will apply only to the Holder and not to any other holder of SPA
Warrants.
(ii)
Principal
Market Regulation.
The
Company shall not be obligated to issue any ADRs upon exercise of this Warrant,
and the Holder of this Warrant shall not have the right to receive upon
conversion of this Warrant, any ADRs, if the issuance of such ADRs would exceed
that number of ADRs which the Company may issue upon exercise of this Warrant
(including, as applicable, any ADRs issued upon conversion of the SPA
Securities) without breaching the Company’s obligations under the rules or
regulations of the Principal Market (or such other Eligible Market on which
the
ADRs or Ordinary Shares are listed) or the ASX (the “Exchange
Cap”),
except that such limitation shall not apply in the event that the Company
obtains the approval of its stockholders as required by the applicable rules
of
the Principal Market and the ASX listing rules for issuances of ADRs in excess
of such amount. Until such approval is obtained, no Buyer shall be issued,
in
the aggregate, upon exercise or conversion, as applicable, of any SPA Warrants
or SPA Securities, any ADRs in an amount greater than the product of the
Exchange Cap multiplied by a fraction, the numerator of which is the total
number of ADRs underlying the SPA Warrants issued to such Buyer pursuant to
the
Amendment Agreement on the Subscription Date and the denominator of which is
the
aggregate number of ADRs underlying all the Warrants issued to the Buyers
pursuant to the Amendment Agreement on the Subscription Date (with respect
to
each Buyer, the “Exchange
Cap Allocation”).
In
the event that any Buyer shall sell or otherwise transfer any of such Buyer’s
SPA Warrants, the transferee shall be allocated a pro rata portion of such
Buyer’s Exchange Cap Allocation, and the restrictions of the prior sentence
shall apply to such transferee with respect to the portion of the Exchange
Cap
Allocation allocated to such transferee. In the event that any holder of SPA
Warrants shall exercise all of such holder’s SPA Warrants into a number of
ADRs
which,
in
the aggregate, is less than such holder’s Exchange Cap Allocation, then the
difference between such holder’s Exchange Cap Allocation and the number of ADRs
actually issued to such holder shall be allocated to the respective Exchange
Cap
Allocations of the remaining holders of SPA Warrants on a pro rata basis in
proportion to the ADRs underlying the SPA Warrants then held by each such
holder.
2. ADJUSTMENT
OF EXERCISE PRICE.
(a) Adjustment
in the Event of a Rights Offering.
If the
Company issues or gives the holders of Ordinary Shares in the Company
the right, pro rata with existing holdings of Ordinary Shares, to subscribe
for additional securities (“Pro
Rata Issue”),
the
Exercise Price in respect of one underlying Ordinary Share shall be reduced
in
accordance with the following formula:
|
O’
= O -
|
E
[P - (S + D)]
|
|
N
+
1
|
Where:
O’
=
the
new
Exercise Price in respect of an underlying Ordinary Share.
O = the
original Exercise Price in respect of an underlying Ordinary Share.
E = the
number of underlying Ordinary Shares to be issued on exercise of each
Warrant.
P = the
average market price per Ordinary Share (weighted by reference to volume) of
the
Ordinary Shares during the 5 trading days ending before the ex rights date
or ex
entitlements date.
S = the
subscription price for an Ordinary Share under the Pro Rata Issue.
D = the
dividend due but not paid on the existing Ordinary Shares (excluding those
to be
issued under the Pro Rata Issue).
N = the
number of Ordinary Shares which must be held to receive one new Share in the
Pro
Rata Issue.
(b) Adjustment
upon pro rata bonus issue of Ordinary Shares.
If
the
Company makes a pro rata bonus issue of Ordinary Shares to its shareholders
prior to the Warrant being exercised, and the Warrant is not exercised prior
to
the record date for the issue, the Warrant will, when exercised, entitle the
Holder to the number of Warrant Shares that would ordinarily be received under
Section 1, plus the number of bonus Ordinary Shares which would have been issued
to the Holder if the Warrant had been exercised prior to the record
date.
(c) Adjustment
upon Subdivision or Combination of Ordinary Shares.
If the
Company at any time on or after the Subscription Date subdivides (by any stock
split, stock dividend, recapitalization or otherwise) one or more classes of
its
outstanding ADRs (or Ordinary Shares underlying such ADRs) into a greater number
of ADRs (or Ordinary Shares), the Exercise Price in effect immediately prior
to
such subdivision will be proportionately reduced and the number of Warrant
Shares (or Ordinary Shares underlying such Warrant Shares) will be
proportionately increased. If the Company at any time on or after the
Subscription Date combines (by combination, reverse stock split or otherwise)
one or more classes of its outstanding ADRs (or Ordinary Shares underlying
such
ADRs) into a smaller number of ADRs (or Ordinary Shares underlying such ADRs),
the Exercise Price in effect immediately prior to such combination will be
proportionately increased and the number of Warrant Shares (or Ordinary Shares
underlying such Warrant Shares) will be proportionately decreased. Any
adjustment under this Section 2(c) shall be subject to (and will be
correspondingly reorganized in a manner which is permissible under, or necessary
to comply with) the ASX Listing Rules or the rules of any Recognized Exchange
in
force at the relevant time and shall become effective at the close of business
on the date the subdivision or combination becomes effective.
(d) Other
Events.
If any
event occurs of the type contemplated by the provisions of this Section 2 but
not expressly provided for by such provisions (including, without limitation,
the granting of stock appreciation rights, phantom stock rights or other rights
with equity features), then the Company’s Board of Directors will make an
appropriate adjustment in the Exercise Price and the number of Warrant Shares
so
as to protect the rights of the Holder; provided that such adjustment is made
in
accordance with the ASX Listing Rules. No such adjustment pursuant to this
Section 2(d) will increase the Exercise Price or decrease the number of Warrant
Shares as otherwise determined pursuant to this Section 2, unless in accordance
with any ASX Listing Rule.
(e) Other
Capital Reorganizations.
Notwithstanding any other provision contained in this Warrant, the rights of
a
warrant holder will be changed to the extent necessary to comply with the
listing rules applying to a reorganization of capital at the time of
reorganization. Subject to the above, if there is a reorganization of the
capital of the Company, the number of Warrant Shares applicable to the Warrant
and/or Exercise Price of the Warrant will be reorganized as follows: (i) if
the
Company returns capital on its Ordinary Shares, the number of Warrant Shares
applicable to the Warrant will remain the same, and the Exercise Price of each
Warrant will be reduced by the same amount as the amount returned in relation
to
each Ordinary Share; (ii) if the Company returns capital on its Ordinary Shares
by a cancellation of capital that is lost or not represented by available
assets, the number of Warrant Shares applicable to the Warrant and the Exercise
Price is unaltered; (iii) if the Company reduces its issued Ordinary Shares
on a
pro rata basis, the number of Warrant Shares applicable to the Warrant will
be
reduced in the same ratio as the Ordinary Shares and the Exercise Price will
be
amended in inverse proportion to that ratio; and (iv) if the Company reorganizes
its issued Ordinary Shares in any way not otherwise contemplated by the
preceding paragraphs, the number of Warrant Shares applicable to the Warrant
or
the Exercise Price or both will be reorganized so that the Warrant Holder will
not receive a benefit that holders of Ordinary Shares do not receive. The
Company shall give notice to Warrant Holders of any adjustments to the number
of
Warrant Shares applicable to the Warrant or the number of Ordinary Shares which
are to be issued on exercise of
a
Warrant
or to the Exercise Price. Before a Warrant is exercised, all adjustment
calculations are to be carried out including all fractions (in relation to
each
of the number of Warrant Shares applicable to the Warrant, the number of
Ordinary Shares and the Exercise Price), but on exercise the number of Warrant
Shares or Ordinary Shares issued is rounded down to the next lower whole number
and the Exercise Price rounded up to the next higher cent.
3. FUNDAMENTAL
TRANSACTIONS. The Company shall not enter into or be party to a Fundamental
Transaction unless, and shall use its best endeavors to procure that, (i)
the Successor Entity (if other than the Company) assumes in writing all of
the
obligations of the Company under this Warrant and the other Transaction
Documents in accordance with the provisions of this Section (4)(b) pursuant
to written agreements in form and substance reasonably satisfactory to the
Required Holders and approved by the Required Holders prior to such Fundamental
Transaction, including agreements to deliver to each holder of Warrants in
exchange for such Warrants a security of such Successor Entity evidenced by
a
written instrument substantially similar in form and substance to this Warrant,
including, without limitation, an adjusted exercise price equal to the value
for
the Ordinary Shares reflected by the terms of such Fundamental Transaction,
and
exercisable for a corresponding number of shares of capital stock equivalent
to
the Ordinary Shares underlying the Warrant Shares acquirable and receivable
upon
exercise of this Warrant (without regard to any limitations on the exercise
of
this Warrant) prior to such Fundamental Transaction, and reasonably satisfactory
to the Required Holders and (ii) such Successor Entity is a publicly traded
corporation whose common shares (or whose American Depositary Shares) are quoted
on or listed for trading on an Eligible Market. Upon the occurrence of any
Fundamental Transaction, such Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such Fundamental
Transaction, the provisions of this Warrant referring to the “Company” shall
refer instead to such Successor Entity), and may exercise every right and power
of the Company and shall assume all of the obligations of the Company under
this
Warrant with the same effect as if such Successor Entity had been named as
the
Company herein. Upon consummation of the Fundamental Transaction, such Successor
Entity shall deliver to the Holder confirmation that there shall be issued
upon
exercise of this Warrant at any time after the consummation of the Fundamental
Transaction, in lieu of the Warrant Shares (or other securities, cash, assets
or
other property) purchasable upon the exercise of the Warrant prior to such
Fundamental Transaction, such shares of the publicly traded common stock (or
their equivalent) of the Successor Entity (including its Parent Entity), as
adjusted in accordance with the provisions of this Warrant. In addition to
and
not in substitution for any other rights hereunder, prior to the consummation
of
any Fundamental Transaction pursuant to which holders of Ordinary Shares
(directly or indirectly through Warrant Shares or otherwise) are entitled to
receive securities or other assets with respect to or in exchange for Ordinary
Shares (a “Corporate Event”), the Company shall make appropriate provision, to
the extent not prohibited by applicable law, to insure that the Holder will
thereafter have the right to receive upon an exercise of this Warrant at any
time after the consummation of the Fundamental Transaction but prior to the
Expiration Date, in lieu of the Warrant Shares purchasable upon the exercise
of
the Warrant prior to such Fundamental Transaction, such, securities or other,
assets which the Holder would have been entitled to receive upon the happening
of such Fundamental Transaction had the Warrant been exercised immediately
prior
to such Fundamental Transaction. The provisions of this Section shall apply
similarly and
equally
to successive Fundamental Transactions and Corporate Events and shall be applied
without regard to any limitations on the exercise of this Warrant.
4. NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment
of its Constitution or Bylaws or through any reorganization, transfer of assets,
consolidation, merger, scheme of arrangement, dissolution, issue or sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, and will at all times in
good faith carry out all the provisions of this Warrant and take all action
as
may be required to protect the rights of the Holder. Without limiting the
generality of the foregoing, the Company (i) shall not increase the par
value of any Ordinary Shares underlying the Warrant Shares receivable upon
the
exercise of this Warrant above the Exercise Price then in effect and
(ii) shall take all such actions as may be necessary or appropriate in
order that the Company may validly and legally issue fully paid and
nonassessable Warrant Shares upon the exercise of this Warrant.
5. WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided
herein, the Holder, solely in such Person’s capacity as a holder of this
Warrant, shall not be entitled to vote or receive dividends or be deemed the
holder of share capital of the Company for any purpose, nor shall anything
contained in this Warrant be construed to confer upon the Holder, solely in
such
Person’s capacity as the Holder of this Warrant, any of the rights of a
shareholder of the Company or any right to vote, give or withhold consent to
any
corporate action (whether any reorganization, issue of stock, reclassification
of stock, consolidation, merger, conveyance or otherwise), receive notice of
meetings, receive dividends or subscription rights, or otherwise, prior to
the
issuance to the Holder of the Warrant Shares which such Person is then entitled
to receive upon the due exercise of this Warrant. In addition, nothing contained
in this Warrant shall be construed as imposing any liabilities on the Holder
to
purchase any securities (upon exercise of this Warrant or otherwise) or as
a
shareholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company. Notwithstanding this Section 6, the Company
shall provide the Holder with copies of the same notices and other information
given to the shareholders of the Company generally, contemporaneously with
the
giving thereof to the shareholders.
6. REISSUANCE
OF WARRANTS.
(a) Transfer
of Warrant.
If this
Warrant is to be transferred, the Holder shall surrender this Warrant to the
Company, whereupon the Company will forthwith issue and deliver upon the order
of the Holder a new Warrant (in accordance with Section 7(d)), registered as
the
Holder may request, representing the right to purchase the number of Warrant
Shares being transferred by the Holder and, if less then the total number of
Warrant Shares then underlying this Warrant is being transferred, a new Warrant
(in accordance with Section 7(d)) to the Holder representing the right to
purchase the number of Warrant Shares not being transferred.
(b) Lost,
Stolen or Mutilated Warrant.
Upon
receipt by the Company of evidence reasonably satisfactory to the Company of
the
loss, theft, destruction or mutilation of this Warrant, and, in the case of
loss, theft or destruction, of any indemnification undertaking by the Holder
to
the Company in customary form and, in the case of mutilation, upon surrender
and
cancellation
of this Warrant, the Company shall execute and deliver to the Holder a new
Warrant (in accordance with Section 7(d)) representing the right to purchase
the
Warrant Shares then underlying this Warrant.
(c) Exchangeable
for Multiple Warrants.
This
Warrant is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for a new Warrant or Warrants (in accordance
with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant
will represent the right to purchase such portion of such Warrant Shares as
is
designated by the Holder at the time of such surrender; provided, however,
that
no Warrants for fractional Warrant Shares shall be given.
(d) Issuance
of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to the terms
of
this Warrant, such new Warrant (i) shall be of like tenor with this Warrant,
(ii) shall represent, as indicated on the face of such new Warrant, the right
to
purchase the Warrant Shares then underlying this Warrant (or in the case of
a
new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant
Shares designated by the Holder which, when added to the number of Warrant
Shares underlying the other new Warrants issued in connection with such
issuance, does not exceed the number of Warrant Shares then underlying this
Warrant), (iii) shall have an issuance date, as indicated on the face of such
new Warrant which is the same as the Issuance Date, and (iv) shall have the
same
rights and conditions as this Warrant.
7. NOTICES;
CURRENCY.
(a) Notices.
Whenever notice is required to be given under this Warrant, unless otherwise
provided herein, such notice shall be given in accordance with Section 9(f)
of
the Securities Purchase Agreement. The Company shall provide the Holder with
prompt written notice of all actions taken pursuant to this Warrant, including
in reasonable detail a description of such action and the reason therefore.
Without limiting the generality of the foregoing, the Company will give written
notice to the Holder (i) immediately upon any adjustment of the Exercise Price,
setting forth in reasonable detail, and certifying, the calculation of such
adjustment and (ii) at least fifteen days prior to the date on which the Company
closes its books or takes a record (A) with respect to any dividend or
distribution upon the Ordinary Shares or Warrant Shares, (B) with respect to
any
grants, issuances or sales of any Options, Convertible Securities or rights
to
purchase stock, warrants, securities or other property to holders of Ordinary
Shares or Warrant Shares or (C) for determining rights to vote with respect
to
any Fundamental Transaction, dissolution or liquidation, provided in each case
that such information shall be made known to the public prior to or in
conjunction with such notice being provided to the Holder.
(b) Currency.
Unless
otherwise indicated, all dollar amounts referred to in this Warrant are in
United States Dollars.
8. AMENDMENT
AND WAIVER. The provisions of this Warrant may be amended by the Company and
the Company may take any action herein prohibited, or omit to perform any act
herein required to be performed by it, only if the Company has obtained
the
written
consent of the Required Holders and approval from the holders of Ordinary Shares
at a shareholders meeting held in accordance with the ASX Listing Rules and
Corporations
Act 2001
(Cth) or
if otherwise permitted by the ASX Listing Rules. Notwithstanding any provision
of this Warrant, , a term of this Warrant which has the effect of reducing
the
exercise price, increasing the period for exercise or increasing the number
of
Warrant Shares or Ordinary Shares received on exercise is prohibited if it
would
result in a breach of the ASX Listing Rules. Notwithstanding the above, no
change may increase the exercise price of any SPA Warrant or decrease the number
of Warrant Shares or class of stock obtainable upon exercise of any SPA Warrant
without the written consent of the Holder, unless otherwise provided in the
ASX
Listing Rules. A change which has the effect of reducing the purchase price,
increasing the period for exercise or increasing the number of securities
received cannot be made. In addition, subject to the ASX Listing Rules, no
such
amendment shall be effective to the extent that it applies to less than all
of
the holders of the SPA Warrants then outstanding.
9. SEVERABILITY.
If any provision of this Warrant or the application thereof becomes or is
declared by a court of competent jurisdiction to be illegal, void or
unenforceable, the remainder of the terms of this Warrant will continue in
full
force and effect.
10. GOVERNING
LAW. This Warrant shall be governed by and construed and enforced in
accor-dance with, and all questions concerning the construction, validity,
interpretation and performance of this Warrant shall be governed by, the
internal laws of the State of New York, without giving effect to any choice
of
law or conflict of law provision or rule (whether of the State of New York
or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York.
11. CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company
and all the Buyers and shall not be construed against any person as the drafter
hereof. The headings of this Warrant are for convenience of reference and shall
not form part of, or affect the interpretation of, this Warrant.
12. DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Exercise
Price or the calculation of the Warrant Shares, the Company shall submit the
disputed determinations or arithmetic calculations via facsimile within two
(2)
Business Days of receipt of the Exercise Notice giving rise to such dispute,
as
the case may be, to the Holder. If the Holder and the Company are unable to
agree upon such determination or calculation within three (3) Business Days
of
such disputed determination or arithmetic calculation being submitted to the
Holder, then the Company shall, within two Business Days submit via facsimile
(a) the disputed determination of the Exercise Price to an independent,
reputable investment bank selected by the Company and approved by the Holder
or
(b) the disputed arithmetic calculation of the Warrant Shares to the Company’s
independent, outside accountant. The Company at the Company’s expense, shall
cause the investment bank or the accountant, as the case may be, to perform
the
determinations or calculations and notify the Company and the Holder of the
results no later than ten Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s
determination or calculation, as the case may be, shall be binding upon all
parties absent demonstrable error.
13. REMEDIES,
OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in
this Warrant shall be cumulative and in addition to all other remedies available
under this Warrant and the other Transaction Documents, at law or in equity
(including a decree of specific performance and/or other injunctive relief),
and
nothing herein shall limit the right of the Holder right to pursue actual
damages for any failure by the Company to comply with the terms of this Warrant.
The Company acknowledges that a breach by it of its obligations hereunder will
cause irreparable harm to the Holder and that the remedy at law for any such
breach may be inadequate. The Company therefore agrees that, in the event of
any
such breach or threatened breach, the holder of this Warrant shall be entitled,
in addition to all other available remedies, to an injunction restraining any
breach, without the necessity of showing economic loss and without any bond
or
other security being required.
14. TRANSFER.
This Warrant may be offered for sale, sold, transferred or assigned without
the
consent of the Company, except as may otherwise be required by Section 2(f)
of the Securities Purchase Agreement.
15. CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have
the following meanings:
(a) “ADRs”
means
the American Depositary Receipts of the Company evidencing the American
Depositary Shares of the Company which each represent ten (10) Ordinary Shares.
(b) “ASX”
means
the Australian Stock Exchange.
(c) “Bloomberg”
means
Bloomberg Financial Markets.
(d) “Business
Day”
means
any day other than Saturday, Sunday or other day on which commercial banks
in
The City of New York, State of New York, U.S.A. or Perth, Australia are
authorized or required by law to remain closed.
(e) “Closing
Bid Price”
and
“Closing
Sale Price”
means,
for any security as of any date, the last closing bid price and last closing
trade price, respectively, for such security on the Principal Market, as
reported by Bloomberg, or, if the Principal Market begins to operate on an
extended hours basis and does not designate the closing bid price or the closing
trade price, as the case may be, then the last bid price or last trade price,
respectively, of such security prior to 4:00:00 p.m., New York Time, as reported
by Bloomberg, or, if the Principal Market is not the principal securities
exchange or trading market for such security, the last closing bid price or
last
trade price, respectively, of such security on the principal securities exchange
or trading market where such security is listed or traded as reported by
Bloomberg, or if the foregoing do not apply, the last closing bid price or
last
trade price, respectively, of such security in the over-the-counter market
on
the electronic bulletin board for such security as reported by Bloomberg, or,
if
no closing bid price or last trade price, respectively, is reported for such
security by Bloomberg, the average of the bid prices, or the ask prices,
respectively, of any market makers for such security as reported in the “pink
sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If
the Closing Bid Price or the Closing Sale Price cannot be calculated for a
security on a particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such security on such
date shall be the fair market value as mutually determined by the Company and
the Holder. If the Company and the Holder are unable to agree upon the fair
market value of such security, then such dispute shall be resolved pursuant
to
Section 12. All such determinations to be appropriately adjusted for any stock
dividend, stock split, stock combination or other similar transaction during
the
applicable calculation period.
(f) “Convertible
Securities”
means
any stock or securities (other than Options) directly or indirectly convertible
into or exercisable or exchangeable for ADRs or Ordinary Shares.
(g) “Deposit
Agreement”
means
that certain Deposit Agreement, dated as of January 24, 2005 by and among the
Company, the Depositary and the holders and beneficial owners from time to
time
of ADSs evidenced by ADRs issued pursuant to such agreement.
(h) “Depositary”
means
Citibank, N.A., acting in such capacity under the Deposit
Agreement.
(i) “Eligible
Market”
means
the Principal Market, The New York Stock Exchange, Inc., the American Stock
Exchange or The Nasdaq Capital Market.
(j) “Expiration
Date”
means
the date that is sixty months after the Issuance Date or, if such date falls
on
a day other than a Business Day or on which trading does not take place on
the
Principal Market (a “Holiday”),
the
next date that is not a Holiday.
(k) “Fundamental
Transaction”
means
that the Company shall, directly or indirectly, in one or more related
transactions, (i) consolidate or merge with or into (whether or not the Company
is the surviving corporation) another Person, or (ii) sell, assign, transfer,
convey or otherwise dispose of all or substantially all of the properties or
assets of the Company to another Person, or (iii) allow another Person to make
a
purchase, tender or exchange offer that is accepted by the holders of more
than
the 50% of either the outstanding Ordinary Shares (not including any Ordinary
Shares held by the Person or Persons making or party to, or associated or
affiliated with the Persons making or party to, such purchase, tender or
exchange offer), or (iv) consummate a stock purchase agreement or other
business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person whereby
such other Person acquires more than the 50% of the outstanding Ordinary Shares
(not including any Ordinary Shares held by the other Person or other Persons
making or party to, or associated or affiliated with the other Persons making
or
party to, such stock purchase agreement or other business combination), or
(v)
reorganize, recapitalize or reclassify its Ordinary Shares.
(l) “Options”
means
any rights, warrants or options to subscribe for or purchase ADRs, Ordinary
Shares or Convertible Securities.
(m) “Ordinary
Shares”
means
(i) the Company’s ordinary shares of common stock, no par value per share,
and (ii) any share capital into which such Ordinary Shares shall have been
changed or any share capital resulting from a reclassification of such Ordinary
Shares.
(n) “Parent
Entity”
of
a
Person means an entity that, directly or indirectly, controls the applicable
Person and whose common stock or equivalent equity security is quoted or listed
on an Eligible Market, or, if there is more than one such Person or Parent
Entity, the Person or Parent Entity with the largest public market
capitalization as of the date of consummation of the Fundamental
Transaction.
(o) “Person”
means
an individual, a limited liability company, a partnership, a joint venture,
a
corporation, a trust, an unincorporated organization, any other entity and
a
government or any department or agency thereof.
(p) “Principal
Market”
means
the Nasdaq Global Market.
(q) “Registration
Rights Agreement”
means
that certain Second Amended and Restated Registration Rights Agreement by and
among the Company and the Buyers, as such agreement may be amended from time
to
time.
(r) “Required
Holders”
means
the holders of the SPA Warrants representing at least a majority of Warrant
Shares underlying the SPA Warrants then outstanding.
(s) “SPA
Securities”
means
the Notes issued pursuant to the Amendment Agreement.
(t) “Successor
Entity”
means
the Person, which may be the Company, formed by, resulting from or surviving
any
Fundamental Transaction or the Person with which such Fundamental Transaction
shall have been made, provided that if such Person is not a publicly traded
entity whose common stock or equivalent equity security is quoted or listed
for
trading on an Eligible Market, Successor Entity shall mean such Person’s Parent
Entity.
(u) “Trading
Day”
means
any day on which the ADRs are traded on the Principal Market, or, if the
Principal Market is not the principal trading market for the ADRs, then on
the
principal securities exchange or securities market on which the ADRs are then
traded; provided that “Trading Day” shall not include any day on which the ADRs
are scheduled to trade on such exchange or market for less than 4.5 hours or
any
day that the ADRs are suspended from trading during the final hour of trading
on
such exchange or market (or if such exchange or market does not designate in
advance the closing time of trading on such exchange or market, then during
the
hour ending at 4:00:00 p.m., New York Time).
(v) “Transaction
Documents”
has
the
meaning set forth in the Securities Purchase Agreement.
[Signature
Page Follows]
IN
WITNESS WHEREOF,
the
Company has caused this Warrant to Purchase ADRs to be duly executed as of
the
Issuance Date set out above.
PSIVIDA
LIMITED
Name:
Michael
J. Soja
Title:
Vice
President, Finance and Chief Financial Officer
EXHIBIT
A
EXERCISE
NOTICE
TO
BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS
WARRANT
TO PURCHASE ADRS
PSIVIDA
LIMITED
The
undersigned holder hereby exercises the right to purchase _________________
of
the ADRs, each of which representing ten (10) ordinary shares (“Ordinary
Shares”)
of
pSivida Limited, an Australian corporation (the “Company”),
evidenced by the attached Warrant to Purchase ADRs (the “Warrant”).
Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Warrant.
1. Payment
of Exercise Price.
The
undersigned holder shall pay the Aggregate Exercise Price in the sum of
$___________________ to the Company in accordance with the terms of the
Warrant.
2. Delivery
of ADRs.
The
Company shall deliver to the holder __________ ADRs in accordance with the
terms
of the Warrant.
Date:
_______________ __, ______
___________________________________
Name
of
Registered Holder
By:
________________________________
Name:
Title:
ACKNOWLEDGMENT
The
Company hereby acknowledges this Exercise Notice and hereby directs
Citibank, N.A. to issue the above indicated number of Ordinary Shares in
accordance with the Transfer Agent Instructions dated _______________ from
the
Company and acknowledged and agreed to by Citibank, N.A.
PSIVIDA
LIMITED
By:
_________________________________
Name:
Title:
EX 99.5
EXHIBIT
99.5
SERIES
E WARRANT
NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR
THE
SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
(I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR (B) AN OPINION OF COUNSEL,
IN A
FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) IF SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT,
SUCH DOCUMENTS, OPINIONS AND CERTIFICATES AS THE COMPANY MAY REASONABLY REQUIRE.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION
WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY
THE
SECURITIES.
PSIVIDA
LIMITED
Series
E Warrant To Purchase ADRS
Warrant
No.: Series
E-1
Number
of
ADRs: 4,000,000
Date
of
Issuance: May
15, 2007 (“Issuance
Date”)
PSIVIDA
LIMITED, an Australian corporation (the “Company”),
hereby certifies that, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, CASTLERIGG MASTER INVESTMENTS
LTD., the registered holder hereof or its permitted assigns (the “Holder”),
is
entitled, subject to the terms set forth below, to purchase from the Company,
at
the Exercise Price (as defined below) then in effect, upon surrender of this
Warrant to Purchase ADRs (as defined below) (including any Warrants to Purchase
ADRs issued in exchange, transfer or replacement hereof, the “Warrant”),
at
any time or times on or after the date hereof, but not after 11:59 p.m., New
York Time, on the Expiration Date (as defined below), representing up to Four
Million (4,000,000) fully paid nonassessable ADRs (as defined below) (the
“Warrant
Shares”).
Except as otherwise defined herein, capitalized terms in this Warrant shall
have
the meanings set forth in Section 15. This Warrant is one of the Warrants to
purchase Warrant Shares (the “SPA
Warrants”)
issued
pursuant to Section 1 of that certain Amended and Restated Second Amendment
Agreement, dated as of May 15, 2007 (the “Subscription
Date”),
by
and among the Company and the investors (the “Buyers”)
referred to therein (the “Amendment
Agreement”).
1. EXERCISE
OF WARRANT.
(a) Mechanics
of Exercise.
Subject
to the terms and conditions hereof (including, without limitation, the
limitations set forth in Section 1(f)), this Warrant may be exercised by the
Holder on any day on or after the date hereof, in whole or in part, by
(i) delivery of a written notice, in the form attached hereto as
Exhibit
A
(the
“Exercise
Notice”),
of
the Holder’s election to exercise this Warrant and (ii) payment to the
Company of an amount equal to the applicable Exercise Price multiplied by the
number of Warrant Shares as to which this Warrant is being exercised (the
“Aggregate
Exercise Price”)
in
cash or wire transfer of immediately available funds. The Holder shall not
be
required to deliver the original Warrant in order to effect an exercise
hereunder. Execution and delivery of the Exercise Notice with respect to less
than all of the Warrant Shares shall have the same effect as cancellation of
the
original Warrant and issuance of a new Warrant evidencing the right to purchase
the remaining number of Warrant Shares. On or before the second (2nd) Business
Day following the date on which the Company has received each of the Exercise
Notice and the Aggregate Exercise Price the “Exercise
Delivery Documents”),
the
Company shall transmit by facsimile an acknowledgment of confirmation of receipt
of the Exercise Delivery Documents to the Holder and the Company’s transfer
agent (the “Transfer
Agent”).
On or
before the fifth (5th) Business Day following the date on which the Company
has
received all of the Exercise Delivery Documents (the “Share
Delivery Date”),
the
Company shall (X) provided that the Transfer Agent is participating in The
Depository Trust Company (“DTC”)
Fast
Automated Securities Transfer Program, upon the request of the Holder, credit
such aggregate number of Warrant Shares to which the Holder is entitled pursuant
to such exercise to the Holder’s or its designee’s balance account with DTC
through its Deposit Withdrawal Agent Commission system, or (Y) if the Transfer
Agent is not participating in the DTC Fast Automated Securities Transfer
Program, issue and dispatch by overnight courier to the address as specified
in
the Exercise Notice, a certificate, registered in the Company’s share register
in the name of the Holder or its designee, for the number of Warrant Shares
to
which the Holder is entitled pursuant to such exercise. Upon delivery of the
Exercise Delivery Documents, the Holder shall be deemed for all corporate
purposes to have become the holder of record of the Ordinary Shares represented
by the ADRs with respect to which this Warrant has been exercised, irrespective
of the date of delivery of the certificates evidencing the ADRs. If this Warrant
is submitted in connection with any exercise pursuant to this Section 1(a)
and
the number of Warrant Shares represented by this Warrant submitted for exercise
is greater than the number of Warrant Shares being acquired upon an exercise,
then the Company shall as soon as practicable and in no event later than three
Business Days after any exercise and at its own expense, issue a new Warrant
(in
accordance with Section 7(d)) representing the right to purchase the number
of
Warrant Shares purchasable immediately prior to such exercise under this
Warrant, less the number of Warrant Shares with respect to which this Warrant
is
exercised. No fractional Warrant Shares are to be issued upon the exercise
of
this Warrant, but, at the option of the Company, (i) the number of Warrant
Shares to be issued shall be rounded up to the nearest whole number or (ii)
in
lieu of any fractional Warrant Shares to which the Holder would otherwise be
entitled, the Company shall make a cash payment to the Holder equal to the
Closing Sale Price on the date of exercise multiplied by such fraction. Upon
exercise of this Warrant, the Company shall deposit the corresponding number
of
Ordinary Shares representing the American Depositary Shares (“ADSs”)
underlying the ADRs and pay by wire transfer to the Depositary’s account the ADS
issuance fee of $0.03 per ADS to be issued, together with all applicable
taxes
and
expenses otherwise payable under the terms of the Deposit Agreement for the
deposit of Ordinary Shares and issuance of ADSs (including, without limitation,
confirmation that any Australian stock transfer taxes in respect of such deposit
(if any) have been paid by the Company), and the Company shall otherwise comply
with and cause any other necessary party to comply with all the terms of the
Deposit Agreement. The Company shall pay any and all taxes (excluding any taxes
on the income of the Holder) which may be payable with respect to the issuance
and delivery of Warrant Shares upon exercise of this Warrant. Appropriate and
equitable adjustment to the terms and provisions of this Warrant shall be made
in the event of any change to the ratio of Warrant Shares to Ordinary Shares
represented thereby.
In
the
event that the Company’s Board of Directors should determine that the Company
shall transform itself (whether by re-incorporation in the United States or
otherwise) from a foreign private issuer (as defined under the Securities Act
of
1933, as amended) all references to ADRs or ADSs shall be deemed references
to
whatever shares are then issued by the re-domiciled Company and all other
provisions of this Warrant shall be equitably adjusted by the parties hereto
to
the extent necessary or appropriate to reflect such new country of
incorporation.
(b) Exercise
Price.
For
purposes of this Warrant, “Exercise
Price”
means
$1.57 per ADR (which is equivalent to $0.157 per Ordinary Share), subject to
adjustment as provided herein.
(c) Company’s
Failure to Timely Deliver Securities.
If the
Company shall fail to issue to the Holder, the number of Warrant Shares to
which
the Holder is entitled upon the Holder’s exercise of this Warrant and register
such Warrant Shares on the Company’s share register or to credit the Holder’s
balance account with DTC for such number of Warrant Shares to which the Holder
is entitled upon the Holder’s exercise of this Warrant on or prior to the date
which is three (3) Business Days after receipt of the Exercise Delivery
Documents (an “Exercise
Failure”),
then
the Company shall pay damages in cash to the Holder for each date of such
Exercise Failure in an amount equal to an interest rate equal to 10% per annum
applied to the product of (X) the sum of the number of Warrant Shares not issued
to the Holder on or prior to the Share Delivery Date and to which the Holder
is
entitled and (Y) the Closing Sale Price of the Warrant Shares on the Share
Delivery Date. In addition to the foregoing, if within three (3) Trading Days
after the Company’s receipt of the facsimile copy of a Exercise Notice the
Company shall fail to issue and deliver to the Holder and register such Warrant
Shares on the Company’s share register or credit the Holder’s balance account
with DTC for the number of Warrant Shares to which the Holder is entitled upon
such holder’s exercise hereunder, and if on or after such Trading Day the Holder
purchases (in an open market transaction or otherwise) ADRs to deliver in
satisfaction of a sale by the Holder of ADRs issuable upon such exercise that
the Holder anticipated receiving from the Company (a “Buy-In”),
then
the Company shall, within three (3) Business Days after the Holder’s request and
in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal
to the Holder’s total purchase price (including brokerage commissions, if any)
for the ADRs so purchased (the “Buy-In
Price”),
at
which point the Company’s obligation to deliver and issue such ADRs shall be
deemed to have been satisfied and shall terminate, or (ii) promptly honor its
obligation to deliver to the Holder a certificate or certificates representing
such ADRs and pay cash to the Holder in an amount equal to the excess
(if
any)
of the Buy-In Price over the product of (A) such number of ADRs, times (B)
the
Closing Bid Price on the date of exercise.
(d) Registration
Rights.
Notwithstanding
anything contained herein to the contrary, if a Registration Statement (as
defined in the Registration Rights Agreement) covering the Warrant Shares that
are the subject of the Exercise Notice (the “Unavailable
Warrant Shares”)
is not
available for resale of such Unavailable Warrant Shares then the Holder may
elect to exercise this Warrant for Warrant Shares in the form of ADRs or in
the
form of the Ordinary Shares underlying the ADRs and in either case the Company
must, contemporaneous with the issue of the Warrant Shares that are the subject
of the Exercise Notice, lodge with the ASX Limited a notice complying with
section 708A(5)(E) of the Corporations Act 2001 and the ASX Listing Rules
(“Cleansing
Notice”)
and
notify the Holder that it has so lodged a Cleansing Notice, and upon the
lodgement by the Company of the Cleansing Notice, the Holder is free to dispose
of any Ordinary Shares or any interest in Ordinary Shares it holds on the
Australian Stock Exchange Limited in the ordinary course of trading or otherwise
in Australia to any person and the restrictions on sale in that certain
Securities Purchase Agreement, dated as of October 5, 2005, by and among the
Company and the buyers listed on the Schedule of Buyers attached thereto, as
amended (the “Securities
Purchase Agreement”),
including without limitation in Section 2(j)(C) of the Securities Purchase
Agreement, does not apply to any such disposal. Notwithstanding the foregoing,
from after the second anniversary of the Issuance Date, in the event that the
aggregate number of Ordinary Shares that trades on the ASX is less than either
(i) an average of 50,000 Common Shares on each Trading Day during any two month
period or (ii) a weighted average trading price of at least US$50,000 on average
during each Trading Day during any two month period, then at the request of
the
Holder the Company as of the date of such request once again (each of (i) and
(ii), a “Registration
Event”)
shall
be subject to the terms of the Registration Rights Agreement as to the Warrant
Shares; provided, that the Holder makes such request within thirty (30) days
of
a Registration Event.
(e) Disputes.
In the
case of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall issue to the
Holder the number of Warrant Shares that are not disputed and resolve such
dispute in accordance with Section 12.
(f) Limitations
on Exercises.
(i) Beneficial
Ownership.
The
Company shall not effect the exercise of this Warrant, and the Holder shall
not
have the right to exercise this Warrant, to the extent that after giving effect
to such exercise, the Holder (together with affiliates) would beneficially
own
(directly or indirectly through Warrant Shares or otherwise) in excess of 4.99%
(the “Maximum
Percentage”)
of the
Ordinary Shares outstanding immediately after giving effect to such exercise.
For purposes of the foregoing sentence, the number of Ordinary Shares
beneficially owned (directly or indirectly through Warrant Shares or otherwise)
by the Holder and its affiliates shall include the number of Ordinary Shares
underlying the Warrant Shares issuable upon exercise of this Warrant with
respect to which the determination of such sentence is being made, but shall
exclude the number of Ordinary Shares underlying Warrant Shares which would
be
issuable upon (i) exercise of the remaining, unexercised portion of this
Warrant
beneficially
owned by the Holder and its affiliates and (ii) exercise or conversion of the
unexercised or unconverted portion of any other securities of the Company
beneficially owned by such Person and its affiliates (including, without
limitation, any convertible notes or convertible preferred stock or warrants)
subject to a limitation on conversion or exercise analogous to the limitation
contained herein. Except as set forth in the preceding sentence, for purposes
of
this section, beneficial ownership shall be calculated in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended. For purposes
of this Warrant, in determining the number of outstanding Ordinary Shares,
the
Holder may rely on the number of outstanding Ordinary Shares as reflected in
(1)
the Company’s most recent Form 20-F, Form 6-K or other public filing with the
Securities and Exchange Commission, as the case may be, (2) a more recent public
announcement by the Company or (3) any other notice by the Company or the
Transfer Agent setting forth the number of Ordinary Shares outstanding. For
any
reason at any time, upon the written or oral request of the Holder, the Company
shall within two (2) Business Days confirm orally and in writing to the Holder
the number of Ordinary Shares then outstanding. In any case, the number of
outstanding Ordinary Shares shall be determined after giving effect to the
conversion or exercise of securities of the Company, including the SPA
Securities and the SPA Warrants, by the Holder and its affiliates since the
date
as of which such number of outstanding Ordinary Shares was reported. By written
notice to the Company, the Holder may increase or decrease the Maximum
Percentage to any other percentage not in excess of 9.99% specified in such
notice; provided that (i) any such increase will not be effective until the
sixty-first (61st)
day
after such notice is delivered to the Company, and (ii) any such increase or
decrease will apply only to the Holder and not to any other holder of SPA
Warrants.
(ii)
Principal
Market Regulation.
The
Company shall not be obligated to issue any ADRs upon exercise of this Warrant,
and the Holder of this Warrant shall not have the right to receive upon
conversion of this Warrant, any ADRs, if the issuance of such ADRs would exceed
that number of ADRs which the Company may issue upon exercise of this Warrant
(including, as applicable, any ADRs issued upon conversion of the SPA
Securities) without breaching the Company’s obligations under the rules or
regulations of the Principal Market (or such other Eligible Market on which
the
ADRs or Ordinary Shares are listed) or the ASX (the “Exchange
Cap”),
except that such limitation shall not apply in the event that the Company
obtains the approval of its stockholders as required by the applicable rules
of
the Principal Market and the ASX listing rules for issuances of ADRs in excess
of such amount. Until such approval is obtained, no Buyer shall be issued,
in
the aggregate, upon exercise or conversion, as applicable, of any SPA Warrants
or SPA Securities, any ADRs in an amount greater than the product of the
Exchange Cap multiplied by a fraction, the numerator of which is the total
number of ADRs underlying the SPA Warrants issued to such Buyer pursuant to
the
Amendment Agreement on the Subscription Date and the denominator of which is
the
aggregate number of ADRs underlying all the Warrants issued to the Buyers
pursuant to the Amendment Agreement on the Subscription Date (with respect
to
each Buyer, the “Exchange
Cap Allocation”).
In
the event that any Buyer shall sell or otherwise transfer any of such Buyer’s
SPA Warrants, the transferee shall be allocated a pro rata portion of such
Buyer’s Exchange Cap Allocation, and the restrictions of the prior sentence
shall apply to such transferee with respect to the portion of the Exchange
Cap
Allocation allocated to such transferee. In the event that any holder of SPA
Warrants shall exercise all of such holder’s SPA Warrants into a number of
ADRs
which,
in
the aggregate, is less than such holder’s Exchange Cap Allocation, then the
difference between such holder’s Exchange Cap Allocation and the number of ADRs
actually issued to such holder shall be allocated to the respective Exchange
Cap
Allocations of the remaining holders of SPA Warrants on a pro rata basis in
proportion to the ADRs underlying the SPA Warrants then held by each such
holder.
2. ADJUSTMENT
OF EXERCISE PRICE.
(a) Adjustment
in the Event of a Rights Offering.
If the
Company issues or gives the holders of Ordinary Shares in the Company
the right, pro rata with existing holdings of Ordinary Shares, to subscribe
for additional securities (“Pro
Rata Issue”),
the
Exercise Price in respect of one underlying Ordinary Share shall be reduced
in
accordance with the following formula:
|
O’
= O -
|
E
[P - (S + D)]
|
|
N
+
1
|
Where:
O’
=
the
new
Exercise Price in respect of an underlying Ordinary Share.
O = the
original Exercise Price in respect of an underlying Ordinary Share.
E = the
number of underlying Ordinary Shares to be issued on exercise of each
Warrant.
P = the
average market price per Ordinary Share (weighted by reference to volume) of
the
Ordinary Shares during the 5 trading days ending before the ex rights date
or ex
entitlements date.
S = the
subscription price for an Ordinary Share under the Pro Rata Issue.
D = the
dividend due but not paid on the existing Ordinary Shares (excluding those
to be
issued under the Pro Rata Issue).
N = the
number of Ordinary Shares which must be held to receive one new Share in the
Pro
Rata Issue.
(b) Adjustment
upon pro rata bonus issue of Ordinary Shares.
If
the
Company makes a pro rata bonus issue of Ordinary Shares to its shareholders
prior to the Warrant being exercised, and the Warrant is not exercised prior
to
the record date for the issue, the Warrant will, when exercised, entitle the
Holder to the number of Warrant Shares that would ordinarily be received under
Section 1, plus the number of bonus Ordinary Shares which would have been issued
to the Holder if the Warrant had been exercised prior to the record
date.
(c) Adjustment
upon Subdivision or Combination of Ordinary Shares.
If the
Company at any time on or after the Subscription Date subdivides (by any stock
split, stock dividend, recapitalization or otherwise) one or more classes of
its
outstanding ADRs (or Ordinary Shares underlying such ADRs) into a greater number
of ADRs (or Ordinary Shares), the Exercise Price in effect immediately prior
to
such subdivision will be proportionately reduced and the number of Warrant
Shares (or Ordinary Shares underlying such Warrant Shares) will be
proportionately increased. If the Company at any time on or after the
Subscription Date combines (by combination, reverse stock split or otherwise)
one or more classes of its outstanding ADRs (or Ordinary Shares underlying
such
ADRs) into a smaller number of ADRs (or Ordinary Shares underlying such ADRs),
the Exercise Price in effect immediately prior to such combination will be
proportionately increased and the number of Warrant Shares (or Ordinary Shares
underlying such Warrant Shares) will be proportionately decreased. Any
adjustment under this Section 2(c) shall be subject to (and will be
correspondingly reorganized in a manner which is permissible under, or necessary
to comply with) the ASX Listing Rules or the rules of any Recognized Exchange
in
force at the relevant time and shall become effective at the close of business
on the date the subdivision or combination becomes effective.
(d) Other
Events.
If any
event occurs of the type contemplated by the provisions of this Section 2 but
not expressly provided for by such provisions (including, without limitation,
the granting of stock appreciation rights, phantom stock rights or other rights
with equity features), then the Company’s Board of Directors will make an
appropriate adjustment in the Exercise Price and the number of Warrant Shares
so
as to protect the rights of the Holder; provided that such adjustment is made
in
accordance with the ASX Listing Rules. No such adjustment pursuant to this
Section 2(d) will increase the Exercise Price or decrease the number of Warrant
Shares as otherwise determined pursuant to this Section 2, unless in accordance
with any ASX Listing Rule.
(e) Other
Capital Reorganizations.
Notwithstanding any other provision contained in this Warrant, the rights of
a
warrant holder will be changed to the extent necessary to comply with the
listing rules applying to a reorganization of capital at the time of
reorganization. Subject to the above, if there is a reorganization of the
capital of the Company, the number of Warrant Shares applicable to the Warrant
and/or Exercise Price of the Warrant will be reorganized as follows: (i) if
the
Company returns capital on its Ordinary Shares, the number of Warrant Shares
applicable to the Warrant will remain the same, and the Exercise Price of each
Warrant will be reduced by the same amount as the amount returned in relation
to
each Ordinary Share; (ii) if the Company returns capital on its Ordinary Shares
by a cancellation of capital that is lost or not represented by available
assets, the number of Warrant Shares applicable to the Warrant and the Exercise
Price is unaltered; (iii) if the Company reduces its issued Ordinary Shares
on a
pro rata basis, the number of Warrant Shares applicable to the Warrant will
be
reduced in the same ratio as the Ordinary Shares and the Exercise Price will
be
amended in inverse proportion to that ratio; and (iv) if the Company reorganizes
its issued Ordinary Shares in any way not otherwise contemplated by the
preceding paragraphs, the number of Warrant Shares applicable to the Warrant
or
the Exercise Price or both will be reorganized so that the Warrant Holder will
not receive a benefit that holders of Ordinary Shares do not receive. The
Company shall give notice to Warrant Holders of any adjustments to the number
of
Warrant Shares applicable to the Warrant or the number of Ordinary Shares which
are to be issued on exercise of
a
Warrant
or to the Exercise Price. Before a Warrant is exercised, all adjustment
calculations are to be carried out including all fractions (in relation to
each
of the number of Warrant Shares applicable to the Warrant, the number of
Ordinary Shares and the Exercise Price), but on exercise the number of Warrant
Shares or Ordinary Shares issued is rounded down to the next lower whole number
and the Exercise Price rounded up to the next higher cent.
3. FUNDAMENTAL
TRANSACTIONS. The Company shall not enter into or be party to a Fundamental
Transaction unless, and shall use its best endeavors to procure that, (i)
the Successor Entity (if other than the Company) assumes in writing all of
the
obligations of the Company under this Warrant and the other Transaction
Documents in accordance with the provisions of this Section (4)(b) pursuant
to written agreements in form and substance reasonably satisfactory to the
Required Holders and approved by the Required Holders prior to such Fundamental
Transaction, including agreements to deliver to each holder of Warrants in
exchange for such Warrants a security of such Successor Entity evidenced by
a
written instrument substantially similar in form and substance to this Warrant,
including, without limitation, an adjusted exercise price equal to the value
for
the Ordinary Shares reflected by the terms of such Fundamental Transaction,
and
exercisable for a corresponding number of shares of capital stock equivalent
to
the Ordinary Shares underlying the Warrant Shares acquirable and receivable
upon
exercise of this Warrant (without regard to any limitations on the exercise
of
this Warrant) prior to such Fundamental Transaction, and reasonably satisfactory
to the Required Holders and (ii) such Successor Entity is a publicly traded
corporation whose common shares (or whose American Depositary Shares) are quoted
on or listed for trading on an Eligible Market. Upon the occurrence of any
Fundamental Transaction, such Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such Fundamental
Transaction, the provisions of this Warrant referring to the “Company” shall
refer instead to such Successor Entity), and may exercise every right and power
of the Company and shall assume all of the obligations of the Company under
this
Warrant with the same effect as if such Successor Entity had been named as
the
Company herein. Upon consummation of the Fundamental Transaction, such Successor
Entity shall deliver to the Holder confirmation that there shall be issued
upon
exercise of this Warrant at any time after the consummation of the Fundamental
Transaction, in lieu of the Warrant Shares (or other securities, cash, assets
or
other property) purchasable upon the exercise of the Warrant prior to such
Fundamental Transaction, such shares of the publicly traded common stock (or
their equivalent) of the Successor Entity (including its Parent Entity), as
adjusted in accordance with the provisions of this Warrant. In addition to
and
not in substitution for any other rights hereunder, prior to the consummation
of
any Fundamental Transaction pursuant to which holders of Ordinary Shares
(directly or indirectly through Warrant Shares or otherwise) are entitled to
receive securities or other assets with respect to or in exchange for Ordinary
Shares (a “Corporate Event”), the Company shall make appropriate provision, to
the extent not prohibited by applicable law, to insure that the Holder will
thereafter have the right to receive upon an exercise of this Warrant at any
time after the consummation of the Fundamental Transaction but prior to the
Expiration Date, in lieu of the Warrant Shares purchasable upon the exercise
of
the Warrant prior to such Fundamental Transaction, such, securities or other,
assets which the Holder would have been entitled to receive upon the happening
of such Fundamental Transaction had the Warrant been exercised immediately
prior
to such Fundamental Transaction. The provisions of this Section shall apply
similarly and
equally
to successive Fundamental Transactions and Corporate Events and shall be applied
without regard to any limitations on the exercise of this Warrant.
4. NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment
of its Constitution or Bylaws or through any reorganization, transfer of assets,
consolidation, merger, scheme of arrangement, dissolution, issue or sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, and will at all times in
good faith carry out all the provisions of this Warrant and take all action
as
may be required to protect the rights of the Holder. Without limiting the
generality of the foregoing, the Company (i) shall not increase the par
value of any Ordinary Shares underlying the Warrant Shares receivable upon
the
exercise of this Warrant above the Exercise Price then in effect and
(ii) shall take all such actions as may be necessary or appropriate in
order that the Company may validly and legally issue fully paid and
nonassessable Warrant Shares upon the exercise of this Warrant.
5. WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided
herein, the Holder, solely in such Person’s capacity as a holder of this
Warrant, shall not be entitled to vote or receive dividends or be deemed the
holder of share capital of the Company for any purpose, nor shall anything
contained in this Warrant be construed to confer upon the Holder, solely in
such
Person’s capacity as the Holder of this Warrant, any of the rights of a
shareholder of the Company or any right to vote, give or withhold consent to
any
corporate action (whether any reorganization, issue of stock, reclassification
of stock, consolidation, merger, conveyance or otherwise), receive notice of
meetings, receive dividends or subscription rights, or otherwise, prior to
the
issuance to the Holder of the Warrant Shares which such Person is then entitled
to receive upon the due exercise of this Warrant. In addition, nothing contained
in this Warrant shall be construed as imposing any liabilities on the Holder
to
purchase any securities (upon exercise of this Warrant or otherwise) or as
a
shareholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company. Notwithstanding this Section 6, the Company
shall provide the Holder with copies of the same notices and other information
given to the shareholders of the Company generally, contemporaneously with
the
giving thereof to the shareholders.
6. REISSUANCE
OF WARRANTS.
(a) Transfer
of Warrant.
If this
Warrant is to be transferred, the Holder shall surrender this Warrant to the
Company, whereupon the Company will forthwith issue and deliver upon the order
of the Holder a new Warrant (in accordance with Section 7(d)), registered as
the
Holder may request, representing the right to purchase the number of Warrant
Shares being transferred by the Holder and, if less then the total number of
Warrant Shares then underlying this Warrant is being transferred, a new Warrant
(in accordance with Section 7(d)) to the Holder representing the right to
purchase the number of Warrant Shares not being transferred.
(b) Lost,
Stolen or Mutilated Warrant.
Upon
receipt by the Company of evidence reasonably satisfactory to the Company of
the
loss, theft, destruction or mutilation of this Warrant, and, in the case of
loss, theft or destruction, of any indemnification undertaking by the Holder
to
the Company in customary form and, in the case of mutilation, upon surrender
and
cancellation
of this Warrant, the Company shall execute and deliver to the Holder a new
Warrant (in accordance with Section 7(d)) representing the right to purchase
the
Warrant Shares then underlying this Warrant.
(c) Exchangeable
for Multiple Warrants.
This
Warrant is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for a new Warrant or Warrants (in accordance
with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant
will represent the right to purchase such portion of such Warrant Shares as
is
designated by the Holder at the time of such surrender; provided, however,
that
no Warrants for fractional Warrant Shares shall be given.
(d) Issuance
of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to the terms
of
this Warrant, such new Warrant (i) shall be of like tenor with this Warrant,
(ii) shall represent, as indicated on the face of such new Warrant, the right
to
purchase the Warrant Shares then underlying this Warrant (or in the case of
a
new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant
Shares designated by the Holder which, when added to the number of Warrant
Shares underlying the other new Warrants issued in connection with such
issuance, does not exceed the number of Warrant Shares then underlying this
Warrant), (iii) shall have an issuance date, as indicated on the face of such
new Warrant which is the same as the Issuance Date, and (iv) shall have the
same
rights and conditions as this Warrant.
7. NOTICES;
CURRENCY.
(a) Notices.
Whenever notice is required to be given under this Warrant, unless otherwise
provided herein, such notice shall be given in accordance with Section 9(f)
of
the Securities Purchase Agreement. The Company shall provide the Holder with
prompt written notice of all actions taken pursuant to this Warrant, including
in reasonable detail a description of such action and the reason therefore.
Without limiting the generality of the foregoing, the Company will give written
notice to the Holder (i) immediately upon any adjustment of the Exercise Price,
setting forth in reasonable detail, and certifying, the calculation of such
adjustment and (ii) at least fifteen days prior to the date on which the Company
closes its books or takes a record (A) with respect to any dividend or
distribution upon the Ordinary Shares or Warrant Shares, (B) with respect to
any
grants, issuances or sales of any Options, Convertible Securities or rights
to
purchase stock, warrants, securities or other property to holders of Ordinary
Shares or Warrant Shares or (C) for determining rights to vote with respect
to
any Fundamental Transaction, dissolution or liquidation, provided in each case
that such information shall be made known to the public prior to or in
conjunction with such notice being provided to the Holder.
(b) Currency.
Unless
otherwise indicated, all dollar amounts referred to in this Warrant are in
United States Dollars.
8. AMENDMENT
AND WAIVER. The provisions of this Warrant may be amended by the Company and
the Company may take any action herein prohibited, or omit to perform any act
herein required to be performed by it, only if the Company has obtained
the
written
consent of the Required Holders and approval from the holders of Ordinary Shares
at a shareholders meeting held in accordance with the ASX Listing Rules and
Corporations
Act 2001
(Cth) or
if otherwise permitted by the ASX Listing Rules. Notwithstanding any provision
of this Warrant, , a term of this Warrant which has the effect of reducing
the
exercise price, increasing the period for exercise or increasing the number
of
Warrant Shares or Ordinary Shares received on exercise is prohibited if it
would
result in a breach of the ASX Listing Rules. Notwithstanding the above, no
change may increase the exercise price of any SPA Warrant or decrease the number
of Warrant Shares or class of stock obtainable upon exercise of any SPA Warrant
without the written consent of the Holder, unless otherwise provided in the
ASX
Listing Rules. A change which has the effect of reducing the purchase price,
increasing the period for exercise or increasing the number of securities
received cannot be made. In addition, subject to the ASX Listing Rules, no
such
amendment shall be effective to the extent that it applies to less than all
of
the holders of the SPA Warrants then outstanding.
9. SEVERABILITY.
If any provision of this Warrant or the application thereof becomes or is
declared by a court of competent jurisdiction to be illegal, void or
unenforceable, the remainder of the terms of this Warrant will continue in
full
force and effect.
10. GOVERNING
LAW. This Warrant shall be governed by and construed and enforced in
accor-dance with, and all questions concerning the construction, validity,
interpretation and performance of this Warrant shall be governed by, the
internal laws of the State of New York, without giving effect to any choice
of
law or conflict of law provision or rule (whether of the State of New York
or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York.
11. CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company
and all the Buyers and shall not be construed against any person as the drafter
hereof. The headings of this Warrant are for convenience of reference and shall
not form part of, or affect the interpretation of, this Warrant.
12. DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Exercise
Price or the calculation of the Warrant Shares, the Company shall submit the
disputed determinations or arithmetic calculations via facsimile within two
(2)
Business Days of receipt of the Exercise Notice giving rise to such dispute,
as
the case may be, to the Holder. If the Holder and the Company are unable to
agree upon such determination or calculation within three (3) Business Days
of
such disputed determination or arithmetic calculation being submitted to the
Holder, then the Company shall, within two Business Days submit via facsimile
(a) the disputed determination of the Exercise Price to an independent,
reputable investment bank selected by the Company and approved by the Holder
or
(b) the disputed arithmetic calculation of the Warrant Shares to the Company’s
independent, outside accountant. The Company at the Company’s expense, shall
cause the investment bank or the accountant, as the case may be, to perform
the
determinations or calculations and notify the Company and the Holder of the
results no later than ten Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s
determination or calculation, as the case may be, shall be binding upon all
parties absent demonstrable error.
13. REMEDIES,
OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in
this Warrant shall be cumulative and in addition to all other remedies available
under this Warrant and the other Transaction Documents, at law or in equity
(including a decree of specific performance and/or other injunctive relief),
and
nothing herein shall limit the right of the Holder right to pursue actual
damages for any failure by the Company to comply with the terms of this Warrant.
The Company acknowledges that a breach by it of its obligations hereunder will
cause irreparable harm to the Holder and that the remedy at law for any such
breach may be inadequate. The Company therefore agrees that, in the event of
any
such breach or threatened breach, the holder of this Warrant shall be entitled,
in addition to all other available remedies, to an injunction restraining any
breach, without the necessity of showing economic loss and without any bond
or
other security being required.
14. TRANSFER.
This Warrant may be offered for sale, sold, transferred or assigned without
the
consent of the Company, except as may otherwise be required by Section 2(f)
of the Securities Purchase Agreement.
15. CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have
the following meanings:
(a) “ADRs”
means
the American Depositary Receipts of the Company evidencing the American
Depositary Shares of the Company which each represent ten (10) Ordinary Shares.
(b) “ASX”
means
the Australian Stock Exchange.
(c) “Bloomberg”
means
Bloomberg Financial Markets.
(d) “Business
Day”
means
any day other than Saturday, Sunday or other day on which commercial banks
in
The City of New York, State of New York, U.S.A. or Perth, Australia are
authorized or required by law to remain closed.
(e) “Closing
Bid Price”
and
“Closing
Sale Price”
means,
for any security as of any date, the last closing bid price and last closing
trade price, respectively, for such security on the Principal Market, as
reported by Bloomberg, or, if the Principal Market begins to operate on an
extended hours basis and does not designate the closing bid price or the closing
trade price, as the case may be, then the last bid price or last trade price,
respectively, of such security prior to 4:00:00 p.m., New York Time, as reported
by Bloomberg, or, if the Principal Market is not the principal securities
exchange or trading market for such security, the last closing bid price or
last
trade price, respectively, of such security on the principal securities exchange
or trading market where such security is listed or traded as reported by
Bloomberg, or if the foregoing do not apply, the last closing bid price or
last
trade price, respectively, of such security in the over-the-counter market
on
the electronic bulletin board for such security as reported by Bloomberg, or,
if
no closing bid price or last trade price, respectively, is reported for such
security by Bloomberg, the average of the bid prices, or the ask prices,
respectively, of any market makers for such security as reported in the “pink
sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If
the Closing Bid Price or the Closing Sale Price cannot be calculated for a
security on a particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such security on such
date shall be the fair market value as mutually determined by the Company and
the Holder. If the Company and the Holder are unable to agree upon the fair
market value of such security, then such dispute shall be resolved pursuant
to
Section 12. All such determinations to be appropriately adjusted for any stock
dividend, stock split, stock combination or other similar transaction during
the
applicable calculation period.
(f) “Convertible
Securities”
means
any stock or securities (other than Options) directly or indirectly convertible
into or exercisable or exchangeable for ADRs or Ordinary Shares.
(g) “Deposit
Agreement”
means
that certain Deposit Agreement, dated as of January 24, 2005 by and among the
Company, the Depositary and the holders and beneficial owners from time to
time
of ADSs evidenced by ADRs issued pursuant to such agreement.
(h) “Depositary”
means
Citibank, N.A., acting in such capacity under the Deposit
Agreement.
(i) “Eligible
Market”
means
the Principal Market, The New York Stock Exchange, Inc., the American Stock
Exchange or The Nasdaq Capital Market.
(j) “Expiration
Date”
means
the date that is sixty months after the Issuance Date or, if such date falls
on
a day other than a Business Day or on which trading does not take place on
the
Principal Market (a “Holiday”),
the
next date that is not a Holiday.
(k) “Fundamental
Transaction”
means
that the Company shall, directly or indirectly, in one or more related
transactions, (i) consolidate or merge with or into (whether or not the Company
is the surviving corporation) another Person, or (ii) sell, assign, transfer,
convey or otherwise dispose of all or substantially all of the properties or
assets of the Company to another Person, or (iii) allow another Person to make
a
purchase, tender or exchange offer that is accepted by the holders of more
than
the 50% of either the outstanding Ordinary Shares (not including any Ordinary
Shares held by the Person or Persons making or party to, or associated or
affiliated with the Persons making or party to, such purchase, tender or
exchange offer), or (iv) consummate a stock purchase agreement or other
business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person whereby
such other Person acquires more than the 50% of the outstanding Ordinary Shares
(not including any Ordinary Shares held by the other Person or other Persons
making or party to, or associated or affiliated with the other Persons making
or
party to, such stock purchase agreement or other business combination), or
(v)
reorganize, recapitalize or reclassify its Ordinary Shares.
(l) “Options”
means
any rights, warrants or options to subscribe for or purchase ADRs, Ordinary
Shares or Convertible Securities.
(m) “Ordinary
Shares”
means
(i) the Company’s ordinary shares of common stock, no par value per share,
and (ii) any share capital into which such Ordinary Shares shall have been
changed or any share capital resulting from a reclassification of such Ordinary
Shares.
(n) “Parent
Entity”
of
a
Person means an entity that, directly or indirectly, controls the applicable
Person and whose common stock or equivalent equity security is quoted or listed
on an Eligible Market, or, if there is more than one such Person or Parent
Entity, the Person or Parent Entity with the largest public market
capitalization as of the date of consummation of the Fundamental
Transaction.
(o) “Person”
means
an individual, a limited liability company, a partnership, a joint venture,
a
corporation, a trust, an unincorporated organization, any other entity and
a
government or any department or agency thereof.
(p) “Principal
Market”
means
the Nasdaq Global Market.
(q) “Registration
Rights Agreement”
means
that certain Second Amended and Restated Registration Rights Agreement by and
among the Company and the Buyers, as such agreement may be amended from time
to
time.
(r) “Required
Holders”
means
the holders of the SPA Warrants representing at least a majority of Warrant
Shares underlying the SPA Warrants then outstanding.
(s) “SPA
Securities”
means
the Notes issued pursuant to the Amendment Agreement.
(t) “Successor
Entity”
means
the Person, which may be the Company, formed by, resulting from or surviving
any
Fundamental Transaction or the Person with which such Fundamental Transaction
shall have been made, provided that if such Person is not a publicly traded
entity whose common stock or equivalent equity security is quoted or listed
for
trading on an Eligible Market, Successor Entity shall mean such Person’s Parent
Entity.
(u) “Trading
Day”
means
any day on which the ADRs are traded on the Principal Market, or, if the
Principal Market is not the principal trading market for the ADRs, then on
the
principal securities exchange or securities market on which the ADRs are then
traded; provided that “Trading Day” shall not include any day on which the ADRs
are scheduled to trade on such exchange or market for less than 4.5 hours or
any
day that the ADRs are suspended from trading during the final hour of trading
on
such exchange or market (or if such exchange or market does not designate in
advance the closing time of trading on such exchange or market, then during
the
hour ending at 4:00:00 p.m., New York Time).
(v) “Transaction
Documents”
has
the
meaning set forth in the Securities Purchase Agreement.
[Signature
Page Follows]
IN
WITNESS WHEREOF,
the
Company has caused this Warrant to Purchase ADRs to be duly executed as of
the
Issuance Date set out above.
PSIVIDA
LIMITED
Name: Michael
J. Soja
Title:
Vice
President, Finance and Chief Financial Officer
EXHIBIT
A
EXERCISE
NOTICE
TO
BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS
WARRANT
TO PURCHASE ADRS
PSIVIDA
LIMITED
The
undersigned holder hereby exercises the right to purchase _________________
of
the ADRs, each of which representing ten (10) ordinary shares (“Ordinary
Shares”)
of
pSivida Limited, an Australian corporation (the “Company”),
evidenced by the attached Warrant to Purchase ADRs (the “Warrant”).
Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Warrant.
1. Payment
of Exercise Price.
The
undersigned holder shall pay the Aggregate Exercise Price in the sum of
$___________________ to the Company in accordance with the terms of the
Warrant.
2. Delivery
of ADRs.
The
Company shall deliver to the holder __________ ADRs in accordance with the
terms
of the Warrant.
Date:
_______________ __, ______
______________________________
Name
of
Registered Holder
By:
__________________________
Name:
Title:
ACKNOWLEDGMENT
The
Company hereby acknowledges this Exercise Notice and hereby directs
Citibank, N.A. to issue the above indicated number of Ordinary Shares in
accordance with the Transfer Agent Instructions dated _______________ from
the
Company and acknowledged and agreed to by Citibank, N.A.
PSIVIDA
LIMITED
By:
________________________
Name:
Title:
EX 99.6
EXHIBIT
99.6
SERIES
F WARRANT
NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR
THE
SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
(I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR (B) AN OPINION OF COUNSEL,
IN A
FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) IF SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT,
SUCH DOCUMENTS, OPINIONS AND CERTIFICATES AS THE COMPANY MAY REASONABLY REQUIRE.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION
WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY
THE
SECURITIES.
PSIVIDA
LIMITED
Series
F Warrant To Purchase ADRS
Warrant
No.: Series
F-1
Number
of
ADRs: 1,000,000
Date
of
Issuance: May
15, 2007 (“Issuance
Date”)
PSIVIDA
LIMITED, an Australian corporation (the “Company”),
hereby certifies that, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, CASTLERIGG MASTER INVESTMENTS
LTD., the registered holder hereof or its permitted assigns (the “Holder”),
is
entitled, subject to the terms set forth below, to purchase from the Company,
at
the Exercise Price (as defined below) then in effect, upon surrender of this
Warrant to Purchase ADRs (as defined below) (including any Warrants to Purchase
ADRs issued in exchange, transfer or replacement hereof, the “Warrant”),
at
any time or times on or after the date hereof, but not after 11:59 p.m., New
York Time, on the Expiration Date (as defined below), representing up to One
Million (1,000,000) fully paid nonassessable ADRs (as defined below) (the
“Warrant
Shares”).
Except as otherwise defined herein, capitalized terms in this Warrant shall
have
the meanings set forth in Section 15. This Warrant is one of the Warrants to
purchase Warrant Shares (the “SPA
Warrants”)
issued
pursuant to Section 1 of that certain Amended and Restated Second Amendment
Agreement, dated as of May 15, 2007 (the “Subscription
Date”),
by
and among the Company and the investors (the “Buyers”)
referred to therein (the “Amendment
Agreement”).
1. EXERCISE
OF WARRANT.
(a) Mechanics
of Exercise.
Subject
to the terms and conditions hereof (including, without limitation, the
limitations set forth in Section 1(f)), this Warrant may be exercised by the
Holder on any day on or after the date hereof, in whole or in part, by
(i) delivery of a written notice, in the form attached hereto as
Exhibit
A
(the
“Exercise
Notice”),
of
the Holder’s election to exercise this Warrant and (ii) payment to the
Company of an amount equal to the applicable Exercise Price multiplied by the
number of Warrant Shares as to which this Warrant is being exercised (the
“Aggregate
Exercise Price”)
in
cash or wire transfer of immediately available funds. The Holder shall not
be
required to deliver the original Warrant in order to effect an exercise
hereunder. Execution and delivery of the Exercise Notice with respect to less
than all of the Warrant Shares shall have the same effect as cancellation of
the
original Warrant and issuance of a new Warrant evidencing the right to purchase
the remaining number of Warrant Shares. On or before the second (2nd) Business
Day following the date on which the Company has received each of the Exercise
Notice and the Aggregate Exercise Price the “Exercise
Delivery Documents”),
the
Company shall transmit by facsimile an acknowledgment of confirmation of receipt
of the Exercise Delivery Documents to the Holder and the Company’s transfer
agent (the “Transfer
Agent”).
On or
before the fifth (5th) Business Day following the date on which the Company
has
received all of the Exercise Delivery Documents (the “Share
Delivery Date”),
the
Company shall (X) provided that the Transfer Agent is participating in The
Depository Trust Company (“DTC”)
Fast
Automated Securities Transfer Program, upon the request of the Holder, credit
such aggregate number of Warrant Shares to which the Holder is entitled pursuant
to such exercise to the Holder’s or its designee’s balance account with DTC
through its Deposit Withdrawal Agent Commission system, or (Y) if the Transfer
Agent is not participating in the DTC Fast Automated Securities Transfer
Program, issue and dispatch by overnight courier to the address as specified
in
the Exercise Notice, a certificate, registered in the Company’s share register
in the name of the Holder or its designee, for the number of Warrant Shares
to
which the Holder is entitled pursuant to such exercise. Upon delivery of the
Exercise Delivery Documents, the Holder shall be deemed for all corporate
purposes to have become the holder of record of the Ordinary Shares represented
by the ADRs with respect to which this Warrant has been exercised, irrespective
of the date of delivery of the certificates evidencing the ADRs. If this Warrant
is submitted in connection with any exercise pursuant to this Section 1(a)
and
the number of Warrant Shares represented by this Warrant submitted for exercise
is greater than the number of Warrant Shares being acquired upon an exercise,
then the Company shall as soon as practicable and in no event later than three
Business Days after any exercise and at its own expense, issue a new Warrant
(in
accordance with Section 7(d)) representing the right to purchase the number
of
Warrant Shares purchasable immediately prior to such exercise under this
Warrant, less the number of Warrant Shares with respect to which this Warrant
is
exercised. No fractional Warrant Shares are to be issued upon the exercise
of
this Warrant, but, at the option of the Company, (i) the number of Warrant
Shares to be issued shall be rounded up to the nearest whole number or (ii)
in
lieu of any fractional Warrant Shares to which the Holder would otherwise be
entitled, the Company shall make a cash payment to the Holder equal to the
Closing Sale Price on the date of exercise multiplied by such fraction. Upon
exercise of this Warrant, the Company shall deposit the corresponding number
of
Ordinary Shares representing the American Depositary Shares (“ADSs”)
underlying the ADRs and pay by wire transfer to the Depositary’s account the ADS
issuance fee of $0.03 per ADS to be issued, together with all applicable
taxes
and
expenses otherwise payable under the terms of the Deposit Agreement for the
deposit of Ordinary Shares and issuance of ADSs (including, without limitation,
confirmation that any Australian stock transfer taxes in respect of such deposit
(if any) have been paid by the Company), and the Company shall otherwise comply
with and cause any other necessary party to comply with all the terms of the
Deposit Agreement. The Company shall pay any and all taxes (excluding any taxes
on the income of the Holder) which may be payable with respect to the issuance
and delivery of Warrant Shares upon exercise of this Warrant. Appropriate and
equitable adjustment to the terms and provisions of this Warrant shall be made
in the event of any change to the ratio of Warrant Shares to Ordinary Shares
represented thereby.
In
the
event that the Company’s Board of Directors should determine that the Company
shall transform itself (whether by re-incorporation in the United States or
otherwise) from a foreign private issuer (as defined under the Securities Act
of
1933, as amended) all references to ADRs or ADSs shall be deemed references
to
whatever shares are then issued by the re-domiciled Company and all other
provisions of this Warrant shall be equitably adjusted by the parties hereto
to
the extent necessary or appropriate to reflect such new country of
incorporation.
(b) Exercise
Price.
For
purposes of this Warrant, “Exercise
Price”
means
$1.95 per ADR (which is equivalent to $0.195 per Ordinary Share), subject to
adjustment as provided herein.
(c) Company’s
Failure to Timely Deliver Securities.
If the
Company shall fail to issue to the Holder, the number of Warrant Shares to
which
the Holder is entitled upon the Holder’s exercise of this Warrant and register
such Warrant Shares on the Company’s share register or to credit the Holder’s
balance account with DTC for such number of Warrant Shares to which the Holder
is entitled upon the Holder’s exercise of this Warrant on or prior to the date
which is three (3) Business Days after receipt of the Exercise Delivery
Documents (an “Exercise
Failure”),
then
the Company shall pay damages in cash to the Holder for each date of such
Exercise Failure in an amount equal to an interest rate equal to 10% per annum
applied to the product of (X) the sum of the number of Warrant Shares not issued
to the Holder on or prior to the Share Delivery Date and to which the Holder
is
entitled and (Y) the Closing Sale Price of the Warrant Shares on the Share
Delivery Date. In addition to the foregoing, if within three (3) Trading Days
after the Company’s receipt of the facsimile copy of a Exercise Notice the
Company shall fail to issue and deliver to the Holder and register such Warrant
Shares on the Company’s share register or credit the Holder’s balance account
with DTC for the number of Warrant Shares to which the Holder is entitled upon
such holder’s exercise hereunder, and if on or after such Trading Day the Holder
purchases (in an open market transaction or otherwise) ADRs to deliver in
satisfaction of a sale by the Holder of ADRs issuable upon such exercise that
the Holder anticipated receiving from the Company (a “Buy-In”),
then
the Company shall, within three (3) Business Days after the Holder’s request and
in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal
to the Holder’s total purchase price (including brokerage commissions, if any)
for the ADRs so purchased (the “Buy-In
Price”),
at
which point the Company’s obligation to deliver and issue such ADRs shall be
deemed to have been satisfied and shall terminate, or (ii) promptly honor its
obligation to deliver to the Holder a certificate or certificates representing
such ADRs and pay cash to the Holder in an amount equal to the excess
(if
any)
of the Buy-In Price over the product of (A) such number of ADRs, times (B)
the
Closing Bid Price on the date of exercise.
(d) Registration
Rights.
Notwithstanding
anything contained herein to the contrary, if a Registration Statement (as
defined in the Registration Rights Agreement) covering the Warrant Shares that
are the subject of the Exercise Notice (the “Unavailable
Warrant Shares”)
is not
available for resale of such Unavailable Warrant Shares then the Holder may
elect to exercise this Warrant for Warrant Shares in the form of ADRs or in
the
form of the Ordinary Shares underlying the ADRs and in either case the Company
must, contemporaneous with the issue of the Warrant Shares that are the subject
of the Exercise Notice, lodge with the ASX Limited a notice complying with
section 708A(5)(E) of the Corporations Act 2001 and the ASX Listing Rules
(“Cleansing
Notice”)
and
notify the Holder that it has so lodged a Cleansing Notice, and upon the
lodgement by the Company of the Cleansing Notice, the Holder is free to dispose
of any Ordinary Shares or any interest in Ordinary Shares it holds on the
Australian Stock Exchange Limited in the ordinary course of trading or otherwise
in Australia to any person and the restrictions on sale in that certain
Securities Purchase Agreement, dated as of October 5, 2005, by and among the
Company and the buyers listed on the Schedule of Buyers attached thereto, as
amended (the “Securities
Purchase Agreement”),
including without limitation in Section 2(j)(C) of the Securities Purchase
Agreement, does not apply to any such disposal. Notwithstanding the foregoing,
from after the second anniversary of the Issuance Date, in the event that the
aggregate number of Ordinary Shares that trades on the ASX is less than either
(i) an average of 50,000 Common Shares on each Trading Day during any two month
period or (ii) a weighted average trading price of at least US$50,000 on average
during each Trading Day during any two month period, then at the request of
the
Holder the Company as of the date of such request once again (each of (i) and
(ii), a “Registration
Event”)
shall
be subject to the terms of the Registration Rights Agreement as to the Warrant
Shares; provided, that the Holder makes such request within thirty (30) days
of
a Registration Event.
(e) Disputes.
In the
case of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall issue to the
Holder the number of Warrant Shares that are not disputed and resolve such
dispute in accordance with Section 12.
(f) Limitations
on Exercises.
(i) Beneficial
Ownership.
The
Company shall not effect the exercise of this Warrant, and the Holder shall
not
have the right to exercise this Warrant, to the extent that after giving effect
to such exercise, the Holder (together with affiliates) would beneficially
own
(directly or indirectly through Warrant Shares or otherwise) in excess of 4.99%
(the “Maximum
Percentage”)
of the
Ordinary Shares outstanding immediately after giving effect to such exercise.
For purposes of the foregoing sentence, the number of Ordinary Shares
beneficially owned (directly or indirectly through Warrant Shares or otherwise)
by the Holder and its affiliates shall include the number of Ordinary Shares
underlying the Warrant Shares issuable upon exercise of this Warrant with
respect to which the determination of such sentence is being made, but shall
exclude the number of Ordinary Shares underlying Warrant Shares which would
be
issuable upon (i) exercise of the remaining, unexercised portion of this
Warrant
beneficially
owned by the Holder and its affiliates and (ii) exercise or conversion of the
unexercised or unconverted portion of any other securities of the Company
beneficially owned by such Person and its affiliates (including, without
limitation, any convertible notes or convertible preferred stock or warrants)
subject to a limitation on conversion or exercise analogous to the limitation
contained herein. Except as set forth in the preceding sentence, for purposes
of
this section, beneficial ownership shall be calculated in accordance with
Section 13(d) of the Securities Exchange Act of 1934, as amended. For purposes
of this Warrant, in determining the number of outstanding Ordinary Shares,
the
Holder may rely on the number of outstanding Ordinary Shares as reflected in
(1)
the Company’s most recent Form 20-F, Form 6-K or other public filing with the
Securities and Exchange Commission, as the case may be, (2) a more recent public
announcement by the Company or (3) any other notice by the Company or the
Transfer Agent setting forth the number of Ordinary Shares outstanding. For
any
reason at any time, upon the written or oral request of the Holder, the Company
shall within two (2) Business Days confirm orally and in writing to the Holder
the number of Ordinary Shares then outstanding. In any case, the number of
outstanding Ordinary Shares shall be determined after giving effect to the
conversion or exercise of securities of the Company, including the SPA
Securities and the SPA Warrants, by the Holder and its affiliates since the
date
as of which such number of outstanding Ordinary Shares was reported. By written
notice to the Company, the Holder may increase or decrease the Maximum
Percentage to any other percentage not in excess of 9.99% specified in such
notice; provided that (i) any such increase will not be effective until the
sixty-first (61st)
day
after such notice is delivered to the Company, and (ii) any such increase or
decrease will apply only to the Holder and not to any other holder of SPA
Warrants.
(ii)
Principal
Market Regulation.
The
Company shall not be obligated to issue any ADRs upon exercise of this Warrant,
and the Holder of this Warrant shall not have the right to receive upon
conversion of this Warrant, any ADRs, if the issuance of such ADRs would exceed
that number of ADRs which the Company may issue upon exercise of this Warrant
(including, as applicable, any ADRs issued upon conversion of the SPA
Securities) without breaching the Company’s obligations under the rules or
regulations of the Principal Market (or such other Eligible Market on which
the
ADRs or Ordinary Shares are listed) or the ASX (the “Exchange
Cap”),
except that such limitation shall not apply in the event that the Company
obtains the approval of its stockholders as required by the applicable rules
of
the Principal Market and the ASX listing rules for issuances of ADRs in excess
of such amount. Until such approval is obtained, no Buyer shall be issued,
in
the aggregate, upon exercise or conversion, as applicable, of any SPA Warrants
or SPA Securities, any ADRs in an amount greater than the product of the
Exchange Cap multiplied by a fraction, the numerator of which is the total
number of ADRs underlying the SPA Warrants issued to such Buyer pursuant to
the
Amendment Agreement on the Subscription Date and the denominator of which is
the
aggregate number of ADRs underlying all the Warrants issued to the Buyers
pursuant to the Amendment Agreement on the Subscription Date (with respect
to
each Buyer, the “Exchange
Cap Allocation”).
In
the event that any Buyer shall sell or otherwise transfer any of such Buyer’s
SPA Warrants, the transferee shall be allocated a pro rata portion of such
Buyer’s Exchange Cap Allocation, and the restrictions of the prior sentence
shall apply to such transferee with respect to the portion of the Exchange
Cap
Allocation allocated to such transferee. In the event that any holder of SPA
Warrants shall exercise all of such holder’s SPA Warrants into a number of
ADRs
which,
in
the aggregate, is less than such holder’s Exchange Cap Allocation, then the
difference between such holder’s Exchange Cap Allocation and the number of ADRs
actually issued to such holder shall be allocated to the respective Exchange
Cap
Allocations of the remaining holders of SPA Warrants on a pro rata basis in
proportion to the ADRs underlying the SPA Warrants then held by each such
holder.
2. ADJUSTMENT
OF EXERCISE PRICE.
(a) Adjustment
in the Event of a Rights Offering.
If the
Company issues or gives the holders of Ordinary Shares in the Company
the right, pro rata with existing holdings of Ordinary Shares, to subscribe
for additional securities (“Pro
Rata Issue”),
the
Exercise Price in respect of one underlying Ordinary Share shall be reduced
in
accordance with the following formula:
|
O’
= O -
|
E
[P - (S + D)]
|
|
N
+
1
|
Where:
O’
=
the
new
Exercise Price in respect of an underlying Ordinary Share.
O = the
original Exercise Price in respect of an underlying Ordinary Share.
E = the
number of underlying Ordinary Shares to be issued on exercise of each
Warrant.
P = the
average market price per Ordinary Share (weighted by reference to volume) of
the
Ordinary Shares during the 5 trading days ending before the ex rights date
or ex
entitlements date.
S = the
subscription price for an Ordinary Share under the Pro Rata Issue.
D = the
dividend due but not paid on the existing Ordinary Shares (excluding those
to be
issued under the Pro Rata Issue).
N = the
number of Ordinary Shares which must be held to receive one new Share in the
Pro
Rata Issue.
(b) Adjustment
upon pro rata bonus issue of Ordinary Shares.
If
the
Company makes a pro rata bonus issue of Ordinary Shares to its shareholders
prior to the Warrant being exercised, and the Warrant is not exercised prior
to
the record date for the issue, the Warrant will, when exercised, entitle the
Holder to the number of Warrant Shares that would ordinarily be received under
Section 1, plus the number of bonus Ordinary Shares which would have been issued
to the Holder if the Warrant had been exercised prior to the record
date.
(c) Adjustment
upon Subdivision or Combination of Ordinary Shares.
If the
Company at any time on or after the Subscription Date subdivides (by any stock
split, stock dividend, recapitalization or otherwise) one or more classes of
its
outstanding ADRs (or Ordinary Shares underlying such ADRs) into a greater number
of ADRs (or Ordinary Shares), the Exercise Price in effect immediately prior
to
such subdivision will be proportionately reduced and the number of Warrant
Shares (or Ordinary Shares underlying such Warrant Shares) will be
proportionately increased. If the Company at any time on or after the
Subscription Date combines (by combination, reverse stock split or otherwise)
one or more classes of its outstanding ADRs (or Ordinary Shares underlying
such
ADRs) into a smaller number of ADRs (or Ordinary Shares underlying such ADRs),
the Exercise Price in effect immediately prior to such combination will be
proportionately increased and the number of Warrant Shares (or Ordinary Shares
underlying such Warrant Shares) will be proportionately decreased. Any
adjustment under this Section 2(c) shall be subject to (and will be
correspondingly reorganized in a manner which is permissible under, or necessary
to comply with) the ASX Listing Rules or the rules of any Recognized Exchange
in
force at the relevant time and shall become effective at the close of business
on the date the subdivision or combination becomes effective.
(d) Other
Events.
If any
event occurs of the type contemplated by the provisions of this Section 2 but
not expressly provided for by such provisions (including, without limitation,
the granting of stock appreciation rights, phantom stock rights or other rights
with equity features), then the Company’s Board of Directors will make an
appropriate adjustment in the Exercise Price and the number of Warrant Shares
so
as to protect the rights of the Holder; provided that such adjustment is made
in
accordance with the ASX Listing Rules. No such adjustment pursuant to this
Section 2(d) will increase the Exercise Price or decrease the number of Warrant
Shares as otherwise determined pursuant to this Section 2, unless in accordance
with any ASX Listing Rule.
(e) Other
Capital Reorganizations.
Notwithstanding any other provision contained in this Warrant, the rights of
a
warrant holder will be changed to the extent necessary to comply with the
listing rules applying to a reorganization of capital at the time of
reorganization. Subject to the above, if there is a reorganization of the
capital of the Company, the number of Warrant Shares applicable to the Warrant
and/or Exercise Price of the Warrant will be reorganized as follows: (i) if
the
Company returns capital on its Ordinary Shares, the number of Warrant Shares
applicable to the Warrant will remain the same, and the Exercise Price of each
Warrant will be reduced by the same amount as the amount returned in relation
to
each Ordinary Share; (ii) if the Company returns capital on its Ordinary Shares
by a cancellation of capital that is lost or not represented by available
assets, the number of Warrant Shares applicable to the Warrant and the Exercise
Price is unaltered; (iii) if the Company reduces its issued Ordinary Shares
on a
pro rata basis, the number of Warrant Shares applicable to the Warrant will
be
reduced in the same ratio as the Ordinary Shares and the Exercise Price will
be
amended in inverse proportion to that ratio; and (iv) if the Company reorganizes
its issued Ordinary Shares in any way not otherwise contemplated by the
preceding paragraphs, the number of Warrant Shares applicable to the Warrant
or
the Exercise Price or both will be reorganized so that the Warrant Holder will
not receive a benefit that holders of Ordinary Shares do not receive. The
Company shall give notice to Warrant Holders of any adjustments to the number
of
Warrant Shares applicable to the Warrant or the number of Ordinary Shares which
are to be issued on exercise of
a
Warrant
or to the Exercise Price. Before a Warrant is exercised, all adjustment
calculations are to be carried out including all fractions (in relation to
each
of the number of Warrant Shares applicable to the Warrant, the number of
Ordinary Shares and the Exercise Price), but on exercise the number of Warrant
Shares or Ordinary Shares issued is rounded down to the next lower whole number
and the Exercise Price rounded up to the next higher cent.
3. FUNDAMENTAL
TRANSACTIONS. The Company shall not enter into or be party to a Fundamental
Transaction unless, and shall use its best endeavors to procure that, (i)
the Successor Entity (if other than the Company) assumes in writing all of
the
obligations of the Company under this Warrant and the other Transaction
Documents in accordance with the provisions of this Section (4)(b) pursuant
to written agreements in form and substance reasonably satisfactory to the
Required Holders and approved by the Required Holders prior to such Fundamental
Transaction, including agreements to deliver to each holder of Warrants in
exchange for such Warrants a security of such Successor Entity evidenced by
a
written instrument substantially similar in form and substance to this Warrant,
including, without limitation, an adjusted exercise price equal to the value
for
the Ordinary Shares reflected by the terms of such Fundamental Transaction,
and
exercisable for a corresponding number of shares of capital stock equivalent
to
the Ordinary Shares underlying the Warrant Shares acquirable and receivable
upon
exercise of this Warrant (without regard to any limitations on the exercise
of
this Warrant) prior to such Fundamental Transaction, and reasonably satisfactory
to the Required Holders and (ii) such Successor Entity is a publicly traded
corporation whose common shares (or whose American Depositary Shares) are quoted
on or listed for trading on an Eligible Market. Upon the occurrence of any
Fundamental Transaction, such Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such Fundamental
Transaction, the provisions of this Warrant referring to the “Company” shall
refer instead to such Successor Entity), and may exercise every right and power
of the Company and shall assume all of the obligations of the Company under
this
Warrant with the same effect as if such Successor Entity had been named as
the
Company herein. Upon consummation of the Fundamental Transaction, such Successor
Entity shall deliver to the Holder confirmation that there shall be issued
upon
exercise of this Warrant at any time after the consummation of the Fundamental
Transaction, in lieu of the Warrant Shares (or other securities, cash, assets
or
other property) purchasable upon the exercise of the Warrant prior to such
Fundamental Transaction, such shares of the publicly traded common stock (or
their equivalent) of the Successor Entity (including its Parent Entity), as
adjusted in accordance with the provisions of this Warrant. In addition to
and
not in substitution for any other rights hereunder, prior to the consummation
of
any Fundamental Transaction pursuant to which holders of Ordinary Shares
(directly or indirectly through Warrant Shares or otherwise) are entitled to
receive securities or other assets with respect to or in exchange for Ordinary
Shares (a “Corporate Event”), the Company shall make appropriate provision, to
the extent not prohibited by applicable law, to insure that the Holder will
thereafter have the right to receive upon an exercise of this Warrant at any
time after the consummation of the Fundamental Transaction but prior to the
Expiration Date, in lieu of the Warrant Shares purchasable upon the exercise
of
the Warrant prior to such Fundamental Transaction, such, securities or other,
assets which the Holder would have been entitled to receive upon the happening
of such Fundamental Transaction had the Warrant been exercised immediately
prior
to such Fundamental Transaction. The provisions of this Section shall apply
similarly and
equally
to successive Fundamental Transactions and Corporate Events and shall be applied
without regard to any limitations on the exercise of this Warrant.
4. NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment
of its Constitution or Bylaws or through any reorganization, transfer of assets,
consolidation, merger, scheme of arrangement, dissolution, issue or sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, and will at all times in
good faith carry out all the provisions of this Warrant and take all action
as
may be required to protect the rights of the Holder. Without limiting the
generality of the foregoing, the Company (i) shall not increase the par
value of any Ordinary Shares underlying the Warrant Shares receivable upon
the
exercise of this Warrant above the Exercise Price then in effect and
(ii) shall take all such actions as may be necessary or appropriate in
order that the Company may validly and legally issue fully paid and
nonassessable Warrant Shares upon the exercise of this Warrant.
5. WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided
herein, the Holder, solely in such Person’s capacity as a holder of this
Warrant, shall not be entitled to vote or receive dividends or be deemed the
holder of share capital of the Company for any purpose, nor shall anything
contained in this Warrant be construed to confer upon the Holder, solely in
such
Person’s capacity as the Holder of this Warrant, any of the rights of a
shareholder of the Company or any right to vote, give or withhold consent to
any
corporate action (whether any reorganization, issue of stock, reclassification
of stock, consolidation, merger, conveyance or otherwise), receive notice of
meetings, receive dividends or subscription rights, or otherwise, prior to
the
issuance to the Holder of the Warrant Shares which such Person is then entitled
to receive upon the due exercise of this Warrant. In addition, nothing contained
in this Warrant shall be construed as imposing any liabilities on the Holder
to
purchase any securities (upon exercise of this Warrant or otherwise) or as
a
shareholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company. Notwithstanding this Section 6, the Company
shall provide the Holder with copies of the same notices and other information
given to the shareholders of the Company generally, contemporaneously with
the
giving thereof to the shareholders.
6. REISSUANCE
OF WARRANTS.
(a) Transfer
of Warrant.
If this
Warrant is to be transferred, the Holder shall surrender this Warrant to the
Company, whereupon the Company will forthwith issue and deliver upon the order
of the Holder a new Warrant (in accordance with Section 7(d)), registered as
the
Holder may request, representing the right to purchase the number of Warrant
Shares being transferred by the Holder and, if less then the total number of
Warrant Shares then underlying this Warrant is being transferred, a new Warrant
(in accordance with Section 7(d)) to the Holder representing the right to
purchase the number of Warrant Shares not being transferred.
(b) Lost,
Stolen or Mutilated Warrant.
Upon
receipt by the Company of evidence reasonably satisfactory to the Company of
the
loss, theft, destruction or mutilation of this Warrant, and, in the case of
loss, theft or destruction, of any indemnification undertaking by the Holder
to
the Company in customary form and, in the case of mutilation, upon surrender
and
cancellation
of this Warrant, the Company shall execute and deliver to the Holder a new
Warrant (in accordance with Section 7(d)) representing the right to purchase
the
Warrant Shares then underlying this Warrant.
(c) Exchangeable
for Multiple Warrants.
This
Warrant is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for a new Warrant or Warrants (in accordance
with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant
will represent the right to purchase such portion of such Warrant Shares as
is
designated by the Holder at the time of such surrender; provided, however,
that
no Warrants for fractional Warrant Shares shall be given.
(d) Issuance
of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to the terms
of
this Warrant, such new Warrant (i) shall be of like tenor with this Warrant,
(ii) shall represent, as indicated on the face of such new Warrant, the right
to
purchase the Warrant Shares then underlying this Warrant (or in the case of
a
new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant
Shares designated by the Holder which, when added to the number of Warrant
Shares underlying the other new Warrants issued in connection with such
issuance, does not exceed the number of Warrant Shares then underlying this
Warrant), (iii) shall have an issuance date, as indicated on the face of such
new Warrant which is the same as the Issuance Date, and (iv) shall have the
same
rights and conditions as this Warrant.
7. NOTICES;
CURRENCY.
(a) Notices.
Whenever notice is required to be given under this Warrant, unless otherwise
provided herein, such notice shall be given in accordance with Section 9(f)
of
the Securities Purchase Agreement. The Company shall provide the Holder with
prompt written notice of all actions taken pursuant to this Warrant, including
in reasonable detail a description of such action and the reason therefore.
Without limiting the generality of the foregoing, the Company will give written
notice to the Holder (i) immediately upon any adjustment of the Exercise Price,
setting forth in reasonable detail, and certifying, the calculation of such
adjustment and (ii) at least fifteen days prior to the date on which the Company
closes its books or takes a record (A) with respect to any dividend or
distribution upon the Ordinary Shares or Warrant Shares, (B) with respect to
any
grants, issuances or sales of any Options, Convertible Securities or rights
to
purchase stock, warrants, securities or other property to holders of Ordinary
Shares or Warrant Shares or (C) for determining rights to vote with respect
to
any Fundamental Transaction, dissolution or liquidation, provided in each case
that such information shall be made known to the public prior to or in
conjunction with such notice being provided to the Holder.
(b) Currency.
Unless
otherwise indicated, all dollar amounts referred to in this Warrant are in
United States Dollars.
8. AMENDMENT
AND WAIVER. The provisions of this Warrant may be amended by the Company and
the Company may take any action herein prohibited, or omit to perform any act
herein required to be performed by it, only if the Company has obtained
the
written
consent of the Required Holders and approval from the holders of Ordinary Shares
at a shareholders meeting held in accordance with the ASX Listing Rules and
Corporations
Act 2001
(Cth) or
if otherwise permitted by the ASX Listing Rules. Notwithstanding any provision
of this Warrant, , a term of this Warrant which has the effect of reducing
the
exercise price, increasing the period for exercise or increasing the number
of
Warrant Shares or Ordinary Shares received on exercise is prohibited if it
would
result in a breach of the ASX Listing Rules. Notwithstanding the above, no
change may increase the exercise price of any SPA Warrant or decrease the number
of Warrant Shares or class of stock obtainable upon exercise of any SPA Warrant
without the written consent of the Holder, unless otherwise provided in the
ASX
Listing Rules. A change which has the effect of reducing the purchase price,
increasing the period for exercise or increasing the number of securities
received cannot be made. In addition, subject to the ASX Listing Rules, no
such
amendment shall be effective to the extent that it applies to less than all
of
the holders of the SPA Warrants then outstanding.
9. SEVERABILITY.
If any provision of this Warrant or the application thereof becomes or is
declared by a court of competent jurisdiction to be illegal, void or
unenforceable, the remainder of the terms of this Warrant will continue in
full
force and effect.
10. GOVERNING
LAW. This Warrant shall be governed by and construed and enforced in
accor-dance with, and all questions concerning the construction, validity,
interpretation and performance of this Warrant shall be governed by, the
internal laws of the State of New York, without giving effect to any choice
of
law or conflict of law provision or rule (whether of the State of New York
or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York.
11. CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company
and all the Buyers and shall not be construed against any person as the drafter
hereof. The headings of this Warrant are for convenience of reference and shall
not form part of, or affect the interpretation of, this Warrant.
12. DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Exercise
Price or the calculation of the Warrant Shares, the Company shall submit the
disputed determinations or arithmetic calculations via facsimile within two
(2)
Business Days of receipt of the Exercise Notice giving rise to such dispute,
as
the case may be, to the Holder. If the Holder and the Company are unable to
agree upon such determination or calculation within three (3) Business Days
of
such disputed determination or arithmetic calculation being submitted to the
Holder, then the Company shall, within two Business Days submit via facsimile
(a) the disputed determination of the Exercise Price to an independent,
reputable investment bank selected by the Company and approved by the Holder
or
(b) the disputed arithmetic calculation of the Warrant Shares to the Company’s
independent, outside accountant. The Company at the Company’s expense, shall
cause the investment bank or the accountant, as the case may be, to perform
the
determinations or calculations and notify the Company and the Holder of the
results no later than ten Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s
determination or calculation, as the case may be, shall be binding upon all
parties absent demonstrable error.
13. REMEDIES,
OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in
this Warrant shall be cumulative and in addition to all other remedies available
under this Warrant and the other Transaction Documents, at law or in equity
(including a decree of specific performance and/or other injunctive relief),
and
nothing herein shall limit the right of the Holder right to pursue actual
damages for any failure by the Company to comply with the terms of this Warrant.
The Company acknowledges that a breach by it of its obligations hereunder will
cause irreparable harm to the Holder and that the remedy at law for any such
breach may be inadequate. The Company therefore agrees that, in the event of
any
such breach or threatened breach, the holder of this Warrant shall be entitled,
in addition to all other available remedies, to an injunction restraining any
breach, without the necessity of showing economic loss and without any bond
or
other security being required.
14. TRANSFER.
This Warrant may be offered for sale, sold, transferred or assigned without
the
consent of the Company, except as may otherwise be required by Section 2(f)
of the Securities Purchase Agreement.
15. CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have
the following meanings:
(a) “ADRs”
means
the American Depositary Receipts of the Company evidencing the American
Depositary Shares of the Company which each represent ten (10) Ordinary Shares.
(b) “ASX”
means
the Australian Stock Exchange.
(c) “Bloomberg”
means
Bloomberg Financial Markets.
(d) “Business
Day”
means
any day other than Saturday, Sunday or other day on which commercial banks
in
The City of New York, State of New York, U.S.A. or Perth, Australia are
authorized or required by law to remain closed.
(e) “Closing
Bid Price”
and
“Closing
Sale Price”
means,
for any security as of any date, the last closing bid price and last closing
trade price, respectively, for such security on the Principal Market, as
reported by Bloomberg, or, if the Principal Market begins to operate on an
extended hours basis and does not designate the closing bid price or the closing
trade price, as the case may be, then the last bid price or last trade price,
respectively, of such security prior to 4:00:00 p.m., New York Time, as reported
by Bloomberg, or, if the Principal Market is not the principal securities
exchange or trading market for such security, the last closing bid price or
last
trade price, respectively, of such security on the principal securities exchange
or trading market where such security is listed or traded as reported by
Bloomberg, or if the foregoing do not apply, the last closing bid price or
last
trade price, respectively, of such security in the over-the-counter market
on
the electronic bulletin board for such security as reported by Bloomberg, or,
if
no closing bid price or last trade price, respectively, is reported for such
security by Bloomberg, the average of the bid prices, or the ask prices,
respectively, of any market makers for such security as reported in the “pink
sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If
the Closing Bid Price or the Closing Sale Price cannot be calculated for a
security on a particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such security on such
date shall be the fair market value as mutually determined by the Company and
the Holder. If the Company and the Holder are unable to agree upon the fair
market value of such security, then such dispute shall be resolved pursuant
to
Section 12. All such determinations to be appropriately adjusted for any stock
dividend, stock split, stock combination or other similar transaction during
the
applicable calculation period.
(f) “Convertible
Securities”
means
any stock or securities (other than Options) directly or indirectly convertible
into or exercisable or exchangeable for ADRs or Ordinary Shares.
(g) “Deposit
Agreement”
means
that certain Deposit Agreement, dated as of January 24, 2005 by and among the
Company, the Depositary and the holders and beneficial owners from time to
time
of ADSs evidenced by ADRs issued pursuant to such agreement.
(h) “Depositary”
means
Citibank, N.A., acting in such capacity under the Deposit
Agreement.
(i) “Eligible
Market”
means
the Principal Market, The New York Stock Exchange, Inc., the American Stock
Exchange or The Nasdaq Capital Market.
(j) “Expiration
Date”
means
the date that is sixty months after the Issuance Date or, if such date falls
on
a day other than a Business Day or on which trading does not take place on
the
Principal Market (a “Holiday”),
the
next date that is not a Holiday.
(k) “Fundamental
Transaction”
means
that the Company shall, directly or indirectly, in one or more related
transactions, (i) consolidate or merge with or into (whether or not the Company
is the surviving corporation) another Person, or (ii) sell, assign, transfer,
convey or otherwise dispose of all or substantially all of the properties or
assets of the Company to another Person, or (iii) allow another Person to make
a
purchase, tender or exchange offer that is accepted by the holders of more
than
the 50% of either the outstanding Ordinary Shares (not including any Ordinary
Shares held by the Person or Persons making or party to, or associated or
affiliated with the Persons making or party to, such purchase, tender or
exchange offer), or (iv) consummate a stock purchase agreement or other
business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person whereby
such other Person acquires more than the 50% of the outstanding Ordinary Shares
(not including any Ordinary Shares held by the other Person or other Persons
making or party to, or associated or affiliated with the other Persons making
or
party to, such stock purchase agreement or other business combination), or
(v)
reorganize, recapitalize or reclassify its Ordinary Shares.
(l) “Options”
means
any rights, warrants or options to subscribe for or purchase ADRs, Ordinary
Shares or Convertible Securities.
(m) “Ordinary
Shares”
means
(i) the Company’s ordinary shares of common stock, no par value per share,
and (ii) any share capital into which such Ordinary Shares shall have been
changed or any share capital resulting from a reclassification of such Ordinary
Shares.
(n) “Parent
Entity”
of
a
Person means an entity that, directly or indirectly, controls the applicable
Person and whose common stock or equivalent equity security is quoted or listed
on an Eligible Market, or, if there is more than one such Person or Parent
Entity, the Person or Parent Entity with the largest public market
capitalization as of the date of consummation of the Fundamental
Transaction.
(o) “Person”
means
an individual, a limited liability company, a partnership, a joint venture,
a
corporation, a trust, an unincorporated organization, any other entity and
a
government or any department or agency thereof.
(p) “Principal
Market”
means
the Nasdaq Global Market.
(q) “Registration
Rights Agreement”
means
that certain Second Amended and Restated Registration Rights Agreement by and
among the Company and the Buyers, as such agreement may be amended from time
to
time.
(r) “Required
Holders”
means
the holders of the SPA Warrants representing at least a majority of Warrant
Shares underlying the SPA Warrants then outstanding.
(s) “SPA
Securities”
means
the Notes issued pursuant to the Amendment Agreement.
(t) “Successor
Entity”
means
the Person, which may be the Company, formed by, resulting from or surviving
any
Fundamental Transaction or the Person with which such Fundamental Transaction
shall have been made, provided that if such Person is not a publicly traded
entity whose common stock or equivalent equity security is quoted or listed
for
trading on an Eligible Market, Successor Entity shall mean such Person’s Parent
Entity.
(u) “Trading
Day”
means
any day on which the ADRs are traded on the Principal Market, or, if the
Principal Market is not the principal trading market for the ADRs, then on
the
principal securities exchange or securities market on which the ADRs are then
traded; provided that “Trading Day” shall not include any day on which the ADRs
are scheduled to trade on such exchange or market for less than 4.5 hours or
any
day that the ADRs are suspended from trading during the final hour of trading
on
such exchange or market (or if such exchange or market does not designate in
advance the closing time of trading on such exchange or market, then during
the
hour ending at 4:00:00 p.m., New York Time).
(v) “Transaction
Documents”
has
the
meaning set forth in the Securities Purchase Agreement.
[Signature
Page Follows]
IN
WITNESS WHEREOF,
the
Company has caused this Warrant to Purchase ADRs to be duly executed as of
the
Issuance Date set out above.
PSIVIDA
LIMITED
Name:
Michael
J. Soja
Title:
Vice
President, Finance and Chief Financial Officer
EXHIBIT
A
EXERCISE
NOTICE
TO
BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS
WARRANT
TO PURCHASE ADRS
PSIVIDA
LIMITED
The
undersigned holder hereby exercises the right to purchase _________________
of
the ADRs, each of which representing ten (10) ordinary shares (“Ordinary
Shares”)
of
pSivida Limited, an Australian corporation (the “Company”),
evidenced by the attached Warrant to Purchase ADRs (the “Warrant”).
Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Warrant.
1. Payment
of Exercise Price.
The
undersigned holder shall pay the Aggregate Exercise Price in the sum of
$___________________ to the Company in accordance with the terms of the
Warrant.
2. Delivery
of ADRs.
The
Company shall deliver to the holder __________ ADRs in accordance with the
terms
of the Warrant.
Date:
_______________ __, ______
_____________________________
Name
of
Registered Holder
By:
_________________________
Name:
Title:
ACKNOWLEDGMENT
The
Company hereby acknowledges this Exercise Notice and hereby directs
Citibank, N.A. to issue the above indicated number of Ordinary Shares in
accordance with the Transfer Agent Instructions dated _______________ from
the
Company and acknowledged and agreed to by Citibank, N.A.
PSIVIDA
LIMITED
By:
______________________________
Name:
Title:
EX 99.7
EXHIBIT
99.7
SERIES
G WARRANT
NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR
THE
SECURITIES INTO WHICH THESE SECURITIES ARE EXERCISABLE HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED
(I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR (B) AN OPINION OF COUNSEL,
IN A
FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED
UNDER SAID ACT OR (II) IF SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID
ACT,
SUCH DOCUMENTS, OPINIONS AND CERTIFICATES AS THE COMPANY MAY REASONABLY REQUIRE.
NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY BE PLEDGED IN CONNECTION
WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY
THE
SECURITIES.
PSIVIDA
LIMITED
Series
G Warrant To Purchase ADRS
Warrant
No.:
Series
G-1
Number
of
ADRs: 2,341,347
Date
of
Issuance: May
15, 2007 (“Issuance
Date”)
PSIVIDA
LIMITED, an Australian corporation (the “Company”),
hereby certifies that, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, CASTLERIGG MASTER INVESTMENTS
LTD., the registered holder hereof or its permitted assigns (the “Holder”),
is
entitled, subject to the terms set forth below, to purchase from the Company,
at
the Exercise Price (as defined below) then in effect, upon surrender of this
Warrant to Purchase ADRs (as defined below) (including any Warrants to Purchase
ADRs issued in exchange, transfer or replacement hereof, the “Warrant”),
at
any time or times on or after the date hereof, but not after 11:59 p.m., New
York Time, on the Expiration Date (as defined below), representing up to Two
Million Three Hundred Forty One Thousand Three Hundred Forty Seven (2,341,347)
fully paid nonassessable ADRs (as defined below) (the
“Warrant
Shares”).
Except as otherwise defined herein, capitalized terms in this Warrant shall
have
the meanings set forth in Section 15. This Warrant is one of the Warrants to
purchase Warrant Shares (the “SPA
Warrants”)
issued
pursuant to Section 1 of that certain Amended and Restated Second Amendment
Agreement, dated as of May 15, 2007 (the “Subscription
Date”),
by
and among the Company and the investors (the “Buyers”)
referred to therein (the “Amendment
Agreement”).
1. EXERCISE
OF WARRANT.
(a) Mechanics
of Exercise.
Subject
to the terms and conditions hereof (including, without limitation, the
limitations set forth in Section 1(f)), this Warrant may be exercised by the
Holder on any day on or after the date hereof, in whole or in part, by
(i) delivery of a written notice, in the form attached hereto as
Exhibit
A
(the
“Exercise
Notice”),
of
the Holder’s election to exercise this Warrant and (ii) payment to the
Company of an amount equal to the applicable Exercise Price multiplied by the
number of Warrant Shares as to which this Warrant is being exercised (the
“Aggregate
Exercise Price”)
in
cash or wire transfer of immediately available funds. The Holder shall not
be
required to deliver the original Warrant in order to effect an exercise
hereunder. Execution and delivery of the Exercise Notice with respect to less
than all of the Warrant Shares shall have the same effect as cancellation of
the
original Warrant and issuance of a new Warrant evidencing the right to purchase
the remaining number of Warrant Shares. On or before the second (2nd) Business
Day following the date on which the Company has received each of the Exercise
Notice and the Aggregate Exercise Price the “Exercise
Delivery Documents”),
the
Company shall transmit by facsimile an acknowledgment of confirmation of receipt
of the Exercise Delivery Documents to the Holder and the Company’s transfer
agent (the “Transfer
Agent”).
On or
before the fifth (5th) Business Day following the date on which the Company
has
received all of the Exercise Delivery Documents (the “Share
Delivery Date”),
the
Company shall (X) provided that the Transfer Agent is participating in The
Depository Trust Company (“DTC”)
Fast
Automated Securities Transfer Program, upon the request of the Holder, credit
such aggregate number of Warrant Shares to which the Holder is entitled pursuant
to such exercise to the Holder’s or its designee’s balance account with DTC
through its Deposit Withdrawal Agent Commission system, or (Y) if the Transfer
Agent is not participating in the DTC Fast Automated Securities Transfer
Program, issue and dispatch by overnight courier to the address as specified
in
the Exercise Notice, a certificate, registered in the Company’s share register
in the name of the Holder or its designee, for the number of Warrant Shares
to
which the Holder is entitled pursuant to such exercise. Upon delivery of the
Exercise Delivery Documents, the Holder shall be deemed for all corporate
purposes to have become the holder of record of the Ordinary Shares represented
by the ADRs with respect to which this Warrant has been exercised, irrespective
of the date of delivery of the certificates evidencing the ADRs. If this Warrant
is submitted in connection with any exercise pursuant to this Section 1(a)
and
the number of Warrant Shares represented by this Warrant submitted for exercise
is greater than the number of Warrant Shares being acquired upon an exercise,
then the Company shall as soon as practicable and in no event later than three
Business Days after any exercise and at its own expense, issue a new Warrant
(in
accordance with Section 7(d)) representing the right to purchase the number
of
Warrant Shares purchasable immediately prior to such exercise under this
Warrant, less the number of Warrant Shares with respect to which this Warrant
is
exercised. No fractional Warrant Shares are to be issued upon the exercise
of
this Warrant, but, at the option of the Company, (i) the number of Warrant
Shares to be issued shall be rounded up to the nearest whole number or (ii)
in
lieu of any fractional Warrant Shares to which the Holder would otherwise be
entitled, the Company shall make a cash payment to the Holder equal to the
Closing Sale Price on the date of exercise multiplied by such fraction. Upon
exercise of this Warrant, the Company shall deposit the corresponding number
of
Ordinary Shares representing the American Depositary Shares (“ADSs”)
underlying the ADRs and pay by wire transfer to the Depositary’s account the ADS
issuance fee of $0.03 per ADS to be issued, together with all applicable taxes
and expenses otherwise payable under the terms of the Deposit Agreement for
the
deposit of
Ordinary
Shares and issuance of ADSs (including, without limitation, confirmation that
any Australian stock transfer taxes in respect of such deposit (if any) have
been paid by the Company), and the Company shall otherwise comply with and
cause
any other necessary party to comply with all the terms of the Deposit Agreement.
The Company shall pay any and all taxes (excluding any taxes on the income
of
the Holder) which may be payable with respect to the issuance and delivery
of
Warrant Shares upon exercise of this Warrant. Appropriate and equitable
adjustment to the terms and provisions of this Warrant shall be made in the
event of any change to the ratio of Warrant Shares to Ordinary Shares
represented thereby.
In
the
event that the Company’s Board of Directors should determine that the Company
shall transform itself (whether by re-incorporation in the United States or
otherwise) from a foreign private issuer (as defined under the Securities Act
of
1933, as amended) all references to ADRs or ADSs shall be deemed references
to
whatever shares are then issued by the re-domiciled Company and all other
provisions of this Warrant shall be equitably adjusted by the parties hereto
to
the extent necessary or appropriate to reflect such new country of
incorporation.
(b) Exercise
Price.
For
purposes of this Warrant, “Exercise
Price”
means
$1.21 per ADR (which is equivalent to $0.121 per Ordinary Share), subject to
adjustment as provided herein.
(c) Company’s
Failure to Timely Deliver Securities.
If the
Company shall fail to issue to the Holder, the number of Warrant Shares to
which
the Holder is entitled upon the Holder’s exercise of this Warrant and register
such Warrant Shares on the Company’s share register or to credit the Holder’s
balance account with DTC for such number of Warrant Shares to which the Holder
is entitled upon the Holder’s exercise of this Warrant on or prior to the date
which is three (3) Business Days after receipt of the Exercise Delivery
Documents (an “Exercise
Failure”),
then
the Company shall pay damages in cash to the Holder for each date of such
Exercise Failure in an amount equal to an interest rate equal to 10% per annum
applied to the product of (X) the sum of the number of Warrant Shares not issued
to the Holder on or prior to the Share Delivery Date and to which the Holder
is
entitled and (Y) the Closing Sale Price of the Warrant Shares on the Share
Delivery Date. In addition to the foregoing, if within three (3) Trading Days
after the Company’s receipt of the facsimile copy of a Exercise Notice the
Company shall fail to issue and deliver to the Holder and register such Warrant
Shares on the Company’s share register or credit the Holder’s balance account
with DTC for the number of Warrant Shares to which the Holder is entitled upon
such holder’s exercise hereunder, and if on or after such Trading Day the Holder
purchases (in an open market transaction or otherwise) ADRs to deliver in
satisfaction of a sale by the Holder of ADRs issuable upon such exercise that
the Holder anticipated receiving from the Company (a “Buy-In”),
then
the Company shall, within three (3) Business Days after the Holder’s request and
in the Holder’s discretion, either (i) pay cash to the Holder in an amount equal
to the Holder’s total purchase price (including brokerage commissions, if any)
for the ADRs so purchased (the “Buy-In
Price”),
at
which point the Company’s obligation to deliver and issue such ADRs shall be
deemed to have been satisfied and shall terminate, or (ii) promptly honor its
obligation to deliver to the Holder a certificate or certificates representing
such ADRs and pay cash to the Holder in an amount equal to the excess (if any)
of the Buy-In Price over the product of (A) such number of ADRs, times (B)
the
Closing Bid Price on the date of exercise.
(d) Registration
Rights.
Notwithstanding
anything contained herein to the contrary, if a Registration Statement (as
defined in the Registration Rights Agreement) covering the Warrant Shares that
are the subject of the Exercise Notice (the “Unavailable
Warrant Shares”)
is not
available for resale of such Unavailable Warrant Shares then the Holder may
elect to exercise this Warrant for Warrant Shares in the form of ADRs or in
the
form of the Ordinary Shares underlying the ADRs and in either case the Company
must, contemporaneous with the issue of the Warrant Shares that are the subject
of the Exercise Notice, lodge with the ASX Limited a notice complying with
section 708A(5)(E) of the Corporations Act 2001 and the ASX Listing Rules
(“Cleansing
Notice”)
and
notify the Holder that it has so lodged a Cleansing Notice, and upon the
lodgement by the Company of the Cleansing Notice, the Holder is free to dispose
of any Ordinary Shares or any interest in Ordinary Shares it holds on the
Australian Stock Exchange Limited in the ordinary course of trading or otherwise
in Australia to any person and the restrictions on sale in that certain
Securities Purchase Agreement, dated as of October 5, 2005, by and among the
Company and the buyers listed on the Schedule of Buyers attached thereto, as
amended (the “Securities
Purchase Agreement”),
including without limitation in Section 2(j)(C) of the Securities Purchase
Agreement, does not apply to any such disposal. Notwithstanding the foregoing,
from after the second anniversary of the Issuance Date, in the event that the
aggregate number of Ordinary Shares that trades on the ASX is less than either
(i) an average of 50,000 Common Shares on each Trading Day during any two month
period or (ii) a weighted average trading price of at least US$50,000 on average
during each Trading Day during any two month period, then at the request of
the
Holder the Company as of the date of such request once again (each of (i) and
(ii), a “Registration
Event”)
shall
be subject to the terms of the Registration Rights Agreement as to the Warrant
Shares; provided, that the Holder makes such request within thirty (30) days
of
a Registration Event.
(e) Disputes.
In the
case of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall issue to the
Holder the number of Warrant Shares that are not disputed and resolve such
dispute in accordance with Section 12.
(f) Limitations
on Exercises.
(i) Beneficial
Ownership.
The
Company shall not effect the exercise of this Warrant, and the Holder shall
not
have the right to exercise this Warrant, to the extent that after giving effect
to such exercise, the Holder (together with affiliates) would beneficially
own
(directly or indirectly through Warrant Shares or otherwise) in excess of 4.99%
(the “Maximum
Percentage”)
of the
Ordinary Shares outstanding immediately after giving effect to such exercise.
For purposes of the foregoing sentence, the number of Ordinary Shares
beneficially owned (directly or indirectly through Warrant Shares or otherwise)
by the Holder and its affiliates shall include the number of Ordinary Shares
underlying the Warrant Shares issuable upon exercise of this Warrant with
respect to which the determination of such sentence is being made, but shall
exclude the number of Ordinary Shares underlying Warrant Shares which would
be
issuable upon (i) exercise of the remaining, unexercised portion of this
Warrant beneficially owned by the Holder and its affiliates and (ii) exercise
or
conversion of the unexercised or unconverted portion of any other securities
of
the Company beneficially owned by such Person and its affiliates (including,
without limitation, any convertible notes or convertible preferred stock or
warrants) subject to a limitation on conversion or exercise
analogous
to the limitation contained herein. Except as set forth in the preceding
sentence, for purposes of this section, beneficial ownership shall be calculated
in accordance with Section 13(d) of the Securities Exchange Act of 1934, as
amended. For purposes of this Warrant, in determining the number of outstanding
Ordinary Shares, the Holder may rely on the number of outstanding Ordinary
Shares as reflected in (1) the Company’s most recent Form 20-F, Form 6-K or
other public filing with the Securities and Exchange Commission, as the case
may
be, (2) a more recent public announcement by the Company or (3) any other notice
by the Company or the Transfer Agent setting forth the number of Ordinary Shares
outstanding. For any reason at any time, upon the written or oral request of
the
Holder, the Company shall within two (2) Business Days confirm orally and in
writing to the Holder the number of Ordinary Shares then outstanding. In any
case, the number of outstanding Ordinary Shares shall be determined after giving
effect to the conversion or exercise of securities of the Company, including
the
SPA Securities and the SPA Warrants, by the Holder and its affiliates since
the
date as of which such number of outstanding Ordinary Shares was reported. By
written notice to the Company, the Holder may increase or decrease the Maximum
Percentage to any other percentage not in excess of 9.99% specified in such
notice; provided that (i) any such increase will not be effective until the
sixty-first (61st)
day
after such notice is delivered to the Company, and (ii) any such increase or
decrease will apply only to the Holder and not to any other holder of SPA
Warrants.
(ii)
Principal
Market Regulation.
The
Company shall not be obligated to issue any ADRs upon exercise of this Warrant,
and the Holder of this Warrant shall not have the right to receive upon
conversion of this Warrant, any ADRs, if the issuance of such ADRs would exceed
that number of ADRs which the Company may issue upon exercise of this Warrant
(including, as applicable, any ADRs issued upon conversion of the SPA
Securities) without breaching the Company’s obligations under the rules or
regulations of the Principal Market (or such other Eligible Market on which
the
ADRs or Ordinary Shares are listed) or the ASX (the “Exchange
Cap”),
except that such limitation shall not apply in the event that the Company
obtains the approval of its stockholders as required by the applicable rules
of
the Principal Market and the ASX listing rules for issuances of ADRs in excess
of such amount. Until such approval is obtained, no Buyer shall be issued,
in
the aggregate, upon exercise or conversion, as applicable, of any SPA Warrants
or SPA Securities, any ADRs in an amount greater than the product of the
Exchange Cap multiplied by a fraction, the numerator of which is the total
number of ADRs underlying the SPA Warrants issued to such Buyer pursuant to
the
Amendment Agreement on the Subscription Date and the denominator of which is
the
aggregate number of ADRs underlying all the Warrants issued to the Buyers
pursuant to the Amendment Agreement on the Subscription Date (with respect
to
each Buyer, the “Exchange
Cap Allocation”).
In
the event that any Buyer shall sell or otherwise transfer any of such Buyer’s
SPA Warrants, the transferee shall be allocated a pro rata portion of such
Buyer’s Exchange Cap Allocation, and the restrictions of the prior sentence
shall apply to such transferee with respect to the portion of the Exchange
Cap
Allocation allocated to such transferee. In the event that any holder of SPA
Warrants shall exercise all of such holder’s SPA Warrants into a number of ADRs
which, in the aggregate, is less than such holder’s Exchange Cap Allocation,
then the difference between such holder’s Exchange Cap Allocation and the number
of ADRs actually issued to such holder shall be allocated to the respective
Exchange Cap Allocations of the remaining holders of SPA Warrants on a pro
rata
basis in proportion to the ADRs underlying the SPA Warrants then held by each
such holder.
2. ADJUSTMENT
OF EXERCISE PRICE.
(a) Adjustment
in the Event of a Rights Offering.
If the
Company issues or gives the holders of Ordinary Shares in the Company
the right, pro rata with existing holdings of Ordinary Shares, to subscribe
for additional securities (“Pro
Rata Issue”),
the
Exercise Price in respect of one underlying Ordinary Share shall be reduced
in
accordance with the following formula:
|
O’
= O -
|
E
[P - (S + D)]
|
|
N
+
1
|
Where:
O’
=
the
new
Exercise Price in respect of an underlying Ordinary Share.
O = the
original Exercise Price in respect of an underlying Ordinary Share.
E = the
number of underlying Ordinary Shares to be issued on exercise of each
Warrant.
P = the
average market price per Ordinary Share (weighted by reference to volume) of
the
Ordinary Shares during the 5 trading days ending before the ex rights date
or ex
entitlements date.
S = the
subscription price for an Ordinary Share under the Pro Rata Issue.
D = the
dividend due but not paid on the existing Ordinary Shares (excluding those
to be
issued under the Pro Rata Issue).
N = the
number of Ordinary Shares which must be held to receive one new Share in the
Pro
Rata Issue.
(b) Adjustment
upon pro rata bonus issue of Ordinary Shares.
If
the
Company makes a pro rata bonus issue of Ordinary Shares to its shareholders
prior to the Warrant being exercised, and the Warrant is not exercised prior
to
the record date for the issue, the Warrant will, when exercised, entitle the
Holder to the number of Warrant Shares that would ordinarily be received under
Section 1, plus the number of bonus Ordinary Shares which would have been issued
to the Holder if the Warrant had been exercised prior to the record
date.
(c) Adjustment
upon Subdivision or Combination of Ordinary Shares.
If the
Company at any time on or after the Subscription Date subdivides (by any stock
split, stock dividend, recapitalization or otherwise) one or more classes of
its
outstanding ADRs (or Ordinary Shares underlying such ADRs) into a greater number
of ADRs (or Ordinary Shares), the Exercise Price in effect immediately prior
to
such subdivision will be proportionately reduced and the number of Warrant
Shares (or Ordinary Shares underlying such Warrant Shares) will be
proportionately increased. If the Company at any time on or after the
Subscription Date combines
(by
combination, reverse stock split or otherwise) one or more classes of its
outstanding ADRs (or Ordinary Shares underlying such ADRs) into a smaller number
of ADRs (or Ordinary Shares underlying such ADRs), the Exercise Price in effect
immediately prior to such combination will be proportionately increased and
the
number of Warrant Shares (or Ordinary Shares underlying such Warrant Shares)
will be proportionately decreased. Any adjustment under this Section 2(c) shall
be subject to (and will be correspondingly reorganized in a manner which is
permissible under, or necessary to comply with) the ASX Listing Rules or the
rules of any Recognized Exchange in force at the relevant time and shall become
effective at the close of business on the date the subdivision or combination
becomes effective.
(d) Other
Events.
If any
event occurs of the type contemplated by the provisions of this Section 2 but
not expressly provided for by such provisions (including, without limitation,
the granting of stock appreciation rights, phantom stock rights or other rights
with equity features), then the Company’s Board of Directors will make an
appropriate adjustment in the Exercise Price and the number of Warrant Shares
so
as to protect the rights of the Holder; provided that such adjustment is made
in
accordance with the ASX Listing Rules. No such adjustment pursuant to this
Section 2(d) will increase the Exercise Price or decrease the number of Warrant
Shares as otherwise determined pursuant to this Section 2, unless in accordance
with any ASX Listing Rule.
(e) Other
Capital Reorganizations.
Notwithstanding any other provision contained in this Warrant, the rights of
a
warrant holder will be changed to the extent necessary to comply with the
listing rules applying to a reorganization of capital at the time of
reorganization. Subject to the above, if there is a reorganization of the
capital of the Company, the number of Warrant Shares applicable to the Warrant
and/or Exercise Price of the Warrant will be reorganized as follows: (i) if
the
Company returns capital on its Ordinary Shares, the number of Warrant Shares
applicable to the Warrant will remain the same, and the Exercise Price of each
Warrant will be reduced by the same amount as the amount returned in relation
to
each Ordinary Share; (ii) if the Company returns capital on its Ordinary Shares
by a cancellation of capital that is lost or not represented by available
assets, the number of Warrant Shares applicable to the Warrant and the Exercise
Price is unaltered; (iii) if the Company reduces its issued Ordinary Shares
on a
pro rata basis, the number of Warrant Shares applicable to the Warrant will
be
reduced in the same ratio as the Ordinary Shares and the Exercise Price will
be
amended in inverse proportion to that ratio; and (iv) if the Company reorganizes
its issued Ordinary Shares in any way not otherwise contemplated by the
preceding paragraphs, the number of Warrant Shares applicable to the Warrant
or
the Exercise Price or both will be reorganized so that the Warrant Holder will
not receive a benefit that holders of Ordinary Shares do not receive. The
Company shall give notice to Warrant Holders of any adjustments to the number
of
Warrant Shares applicable to the Warrant or the number of Ordinary Shares which
are to be issued on exercise of a Warrant or to the Exercise Price. Before
a
Warrant is exercised, all adjustment calculations are to be carried out
including all fractions (in relation to each of the number of Warrant Shares
applicable to the Warrant, the number of Ordinary Shares and the Exercise
Price), but on exercise the number of Warrant Shares or Ordinary Shares issued
is rounded down to the next lower whole number and the Exercise Price rounded
up
to the next higher cent.
3. FUNDAMENTAL
TRANSACTIONS. The Company shall not enter into or be party to a Fundamental
Transaction unless, and shall use its best endeavors to procure that,
(i)
the
Successor Entity (if other than the Company) assumes in writing all of the
obligations of the Company under this Warrant and the other Transaction
Documents in accordance with the provisions of this Section (4)(b) pursuant
to written agreements in form and substance reasonably satisfactory to the
Required Holders and approved by the Required Holders prior to such Fundamental
Transaction, including agreements to deliver to each holder of Warrants in
exchange for such Warrants a security of such Successor Entity evidenced by
a
written instrument substantially similar in form and substance to this Warrant,
including, without limitation, an adjusted exercise price equal to the value
for
the Ordinary Shares reflected by the terms of such Fundamental Transaction,
and
exercisable for a corresponding number of shares of capital stock equivalent
to
the Ordinary Shares underlying the Warrant Shares acquirable and receivable
upon
exercise of this Warrant (without regard to any limitations on the exercise
of
this Warrant) prior to such Fundamental Transaction, and reasonably satisfactory
to the Required Holders and (ii) such Successor Entity is a publicly traded
corporation whose common shares (or whose American Depositary Shares) are quoted
on or listed for trading on an Eligible Market. Upon the occurrence of any
Fundamental Transaction, such Successor Entity shall succeed to, and be
substituted for (so that from and after the date of such Fundamental
Transaction, the provisions of this Warrant referring to the “Company” shall
refer instead to such Successor Entity), and may exercise every right and power
of the Company and shall assume all of the obligations of the Company under
this
Warrant with the same effect as if such Successor Entity had been named as
the
Company herein. Upon consummation of the Fundamental Transaction, such Successor
Entity shall deliver to the Holder confirmation that there shall be issued
upon
exercise of this Warrant at any time after the consummation of the Fundamental
Transaction, in lieu of the Warrant Shares (or other securities, cash, assets
or
other property) purchasable upon the exercise of the Warrant prior to such
Fundamental Transaction, such shares of the publicly traded common stock (or
their equivalent) of the Successor Entity (including its Parent Entity), as
adjusted in accordance with the provisions of this Warrant. In addition to
and
not in substitution for any other rights hereunder, prior to the consummation
of
any Fundamental Transaction pursuant to which holders of Ordinary Shares
(directly or indirectly through Warrant Shares or otherwise) are entitled to
receive securities or other assets with respect to or in exchange for Ordinary
Shares (a “Corporate Event”), the Company shall make appropriate provision, to
the extent not prohibited by applicable law, to insure that the Holder will
thereafter have the right to receive upon an exercise of this Warrant at any
time after the consummation of the Fundamental Transaction but prior to the
Expiration Date, in lieu of the Warrant Shares purchasable upon the exercise
of
the Warrant prior to such Fundamental Transaction, such, securities or other,
assets which the Holder would have been entitled to receive upon the happening
of such Fundamental Transaction had the Warrant been exercised immediately
prior
to such Fundamental Transaction. The provisions of this Section shall apply
similarly and equally to successive Fundamental Transactions and Corporate
Events and shall be applied without regard to any limitations on the exercise
of
this Warrant.
4. NONCIRCUMVENTION.
The Company hereby covenants and agrees that the Company will not, by amendment
of its Constitution or Bylaws or through any reorganization, transfer of assets,
consolidation, merger, scheme of arrangement, dissolution, issue or sale of
securities, or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, and will at all times in
good faith carry out all the provisions of this Warrant and take all action
as
may be required to protect the rights of the Holder. Without limiting the
generality of the foregoing, the Company (i) shall not increase
the
par
value
of any Ordinary Shares underlying the Warrant Shares receivable upon the
exercise of this Warrant above the Exercise Price then in effect and
(ii) shall take all such actions as may be necessary or appropriate in
order that the Company may validly and legally issue fully paid and
nonassessable Warrant Shares upon the exercise of this Warrant.
5. WARRANT
HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided
herein, the Holder, solely in such Person’s capacity as a holder of this
Warrant, shall not be entitled to vote or receive dividends or be deemed the
holder of share capital of the Company for any purpose, nor shall anything
contained in this Warrant be construed to confer upon the Holder, solely in
such
Person’s capacity as the Holder of this Warrant, any of the rights of a
shareholder of the Company or any right to vote, give or withhold consent to
any
corporate action (whether any reorganization, issue of stock, reclassification
of stock, consolidation, merger, conveyance or otherwise), receive notice of
meetings, receive dividends or subscription rights, or otherwise, prior to
the
issuance to the Holder of the Warrant Shares which such Person is then entitled
to receive upon the due exercise of this Warrant. In addition, nothing contained
in this Warrant shall be construed as imposing any liabilities on the Holder
to
purchase any securities (upon exercise of this Warrant or otherwise) or as
a
shareholder of the Company, whether such liabilities are asserted by the Company
or by creditors of the Company. Notwithstanding this Section 6, the Company
shall provide the Holder with copies of the same notices and other information
given to the shareholders of the Company generally, contemporaneously with
the
giving thereof to the shareholders.
6. REISSUANCE
OF WARRANTS.
(a) Transfer
of Warrant.
If this
Warrant is to be transferred, the Holder shall surrender this Warrant to the
Company, whereupon the Company will forthwith issue and deliver upon the order
of the Holder a new Warrant (in accordance with Section 7(d)), registered as
the
Holder may request, representing the right to purchase the number of Warrant
Shares being transferred by the Holder and, if less then the total number of
Warrant Shares then underlying this Warrant is being transferred, a new Warrant
(in accordance with Section 7(d)) to the Holder representing the right to
purchase the number of Warrant Shares not being transferred.
(b) Lost,
Stolen or Mutilated Warrant.
Upon
receipt by the Company of evidence reasonably satisfactory to the Company of
the
loss, theft, destruction or mutilation of this Warrant, and, in the case of
loss, theft or destruction, of any indemnification undertaking by the Holder
to
the Company in customary form and, in the case of mutilation, upon surrender
and
cancellation of this Warrant, the Company shall execute and deliver to the
Holder a new Warrant (in accordance with Section 7(d)) representing the right
to
purchase the Warrant Shares then underlying this Warrant.
(c) Exchangeable
for Multiple Warrants.
This
Warrant is exchangeable, upon the surrender hereof by the Holder at the
principal office of the Company, for a new Warrant or Warrants (in accordance
with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant
will represent the right to purchase such portion of such Warrant Shares as
is
designated by the Holder at the time of such surrender; provided, however,
that
no Warrants for fractional Warrant Shares shall be given.
(d) Issuance
of New Warrants.
Whenever the Company is required to issue a new Warrant pursuant to the terms
of
this Warrant, such new Warrant (i) shall be of like tenor with this Warrant,
(ii) shall represent, as indicated on the face of such new Warrant, the right
to
purchase the Warrant Shares then underlying this Warrant (or in the case of
a
new Warrant being issued pursuant to Section 7(a) or Section 7(c), the Warrant
Shares designated by the Holder which, when added to the number of Warrant
Shares underlying the other new Warrants issued in connection with such
issuance, does not exceed the number of Warrant Shares then underlying this
Warrant), (iii) shall have an issuance date, as indicated on the face of such
new Warrant which is the same as the Issuance Date, and (iv) shall have the
same
rights and conditions as this Warrant.
7. NOTICES;
CURRENCY.
(a) Notices.
Whenever notice is required to be given under this Warrant, unless otherwise
provided herein, such notice shall be given in accordance with Section 9(f)
of
the Securities Purchase Agreement. The Company shall provide the Holder with
prompt written notice of all actions taken pursuant to this Warrant, including
in reasonable detail a description of such action and the reason therefore.
Without limiting the generality of the foregoing, the Company will give written
notice to the Holder (i) immediately upon any adjustment of the Exercise Price,
setting forth in reasonable detail, and certifying, the calculation of such
adjustment and (ii) at least fifteen days prior to the date on which the Company
closes its books or takes a record (A) with respect to any dividend or
distribution upon the Ordinary Shares or Warrant Shares, (B) with respect to
any
grants, issuances or sales of any Options, Convertible Securities or rights
to
purchase stock, warrants, securities or other property to holders of Ordinary
Shares or Warrant Shares or (C) for determining rights to vote with respect
to
any Fundamental Transaction, dissolution or liquidation, provided in each case
that such information shall be made known to the public prior to or in
conjunction with such notice being provided to the Holder.
(b) Currency.
Unless
otherwise indicated, all dollar amounts referred to in this Warrant are in
United States Dollars.
8. AMENDMENT
AND WAIVER. The provisions of this Warrant may be amended by the Company and
the Company may take any action herein prohibited, or omit to perform any act
herein required to be performed by it, only if the Company has obtained the
written consent of the Required Holders and approval from the holders of
Ordinary Shares at a shareholders meeting held in accordance with the ASX
Listing Rules and Corporations
Act 2001
(Cth) or
if otherwise permitted by the ASX Listing Rules. Notwithstanding any provision
of this Warrant, , a term of this Warrant which has the effect of reducing
the
exercise price, increasing the period for exercise or increasing the number
of
Warrant Shares or Ordinary Shares received on exercise is prohibited if it
would
result in a breach of the ASX Listing Rules. Notwithstanding the above, no
change may increase the exercise price of any SPA Warrant or decrease the number
of Warrant Shares or class of stock obtainable upon exercise of any SPA Warrant
without the written consent of the Holder, unless otherwise provided in the
ASX
Listing Rules. A change which has the effect of reducing the purchase price,
increasing the period for exercise or increasing the number of securities
received cannot be made. In addition, subject to the ASX Listing Rules, no
such
amendment shall be effective to the extent that it applies to less than all
of
the holders of the SPA Warrants then outstanding.
9. SEVERABILITY.
If any provision of this Warrant or the application thereof becomes or is
declared by a court of competent jurisdiction to be illegal, void or
unenforceable, the remainder of the terms of this Warrant will continue in
full
force and effect.
10. GOVERNING
LAW. This Warrant shall be governed by and construed and enforced in
accor-dance with, and all questions concerning the construction, validity,
interpretation and performance of this Warrant shall be governed by, the
internal laws of the State of New York, without giving effect to any choice
of
law or conflict of law provision or rule (whether of the State of New York
or
any other jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York.
11. CONSTRUCTION;
HEADINGS. This Warrant shall be deemed to be jointly drafted by the Company
and all the Buyers and shall not be construed against any person as the drafter
hereof. The headings of this Warrant are for convenience of reference and shall
not form part of, or affect the interpretation of, this Warrant.
12. DISPUTE
RESOLUTION. In the case of a dispute as to the determination of the Exercise
Price or the calculation of the Warrant Shares, the Company shall submit the
disputed determinations or arithmetic calculations via facsimile within two
(2)
Business Days of receipt of the Exercise Notice giving rise to such dispute,
as
the case may be, to the Holder. If the Holder and the Company are unable to
agree upon such determination or calculation within three (3) Business Days
of
such disputed determination or arithmetic calculation being submitted to the
Holder, then the Company shall, within two Business Days submit via facsimile
(a) the disputed determination of the Exercise Price to an independent,
reputable investment bank selected by the Company and approved by the Holder
or
(b) the disputed arithmetic calculation of the Warrant Shares to the Company’s
independent, outside accountant. The Company at the Company’s expense, shall
cause the investment bank or the accountant, as the case may be, to perform
the
determinations or calculations and notify the Company and the Holder of the
results no later than ten Business Days from the time it receives the disputed
determinations or calculations. Such investment bank’s or accountant’s
determination or calculation, as the case may be, shall be binding upon all
parties absent demonstrable error.
13. REMEDIES,
OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF. The remedies provided in
this Warrant shall be cumulative and in addition to all other remedies available
under this Warrant and the other Transaction Documents, at law or in equity
(including a decree of specific performance and/or other injunctive relief),
and
nothing herein shall limit the right of the Holder right to pursue actual
damages for any failure by the Company to comply with the terms of this Warrant.
The Company acknowledges that a breach by it of its obligations hereunder will
cause irreparable harm to the Holder and that the remedy at law for any such
breach may be inadequate. The Company therefore agrees that, in the event of
any
such breach or threatened breach, the holder of this Warrant shall be entitled,
in addition to all other available remedies, to an injunction restraining any
breach, without the necessity of showing economic loss and without any bond
or
other security being required.
14. TRANSFER.
This Warrant may be offered for sale, sold, transferred or assigned without
the
consent of the Company, except as may otherwise be required by Section 2(f)
of the Securities Purchase Agreement.
15. CERTAIN
DEFINITIONS. For purposes of this Warrant, the following terms shall have
the following meanings:
(a) “ADRs”
means
the American Depositary Receipts of the Company evidencing the American
Depositary Shares of the Company which each represent ten (10) Ordinary Shares.
(b) “ASX”
means
the Australian Stock Exchange.
(c) “Bloomberg”
means
Bloomberg Financial Markets.
(d) “Business
Day”
means
any day other than Saturday, Sunday or other day on which commercial banks
in
The City of New York, State of New York, U.S.A. or Perth, Australia are
authorized or required by law to remain closed.
(e) “Closing
Bid Price”
and
“Closing
Sale Price”
means,
for any security as of any date, the last closing bid price and last closing
trade price, respectively, for such security on the Principal Market, as
reported by Bloomberg, or, if the Principal Market begins to operate on an
extended hours basis and does not designate the closing bid price or the closing
trade price, as the case may be, then the last bid price or last trade price,
respectively, of such security prior to 4:00:00 p.m., New York Time, as reported
by Bloomberg, or, if the Principal Market is not the principal securities
exchange or trading market for such security, the last closing bid price or
last
trade price, respectively, of such security on the principal securities exchange
or trading market where such security is listed or traded as reported by
Bloomberg, or if the foregoing do not apply, the last closing bid price or
last
trade price, respectively, of such security in the over-the-counter market
on
the electronic bulletin board for such security as reported by Bloomberg, or,
if
no closing bid price or last trade price, respectively, is reported for such
security by Bloomberg, the average of the bid prices, or the ask prices,
respectively, of any market makers for such security as reported in the “pink
sheets” by Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If
the Closing Bid Price or the Closing Sale Price cannot be calculated for a
security on a particular date on any of the foregoing bases, the Closing Bid
Price or the Closing Sale Price, as the case may be, of such security on such
date shall be the fair market value as mutually determined by the Company and
the Holder. If the Company and the Holder are unable to agree upon the fair
market value of such security, then such dispute shall be resolved pursuant
to
Section 12. All such determinations to be appropriately adjusted for any stock
dividend, stock split, stock combination or other similar transaction during
the
applicable calculation period.
(f) “Convertible
Securities”
means
any stock or securities (other than Options) directly or indirectly convertible
into or exercisable or exchangeable for ADRs or Ordinary Shares.
(g) “Deposit
Agreement”
means
that certain Deposit Agreement, dated as of January 24, 2005 by and among the
Company, the Depositary and the holders and beneficial owners from time to
time
of ADSs evidenced by ADRs issued pursuant to such agreement.
(h) “Depositary”
means
Citibank, N.A., acting in such capacity under the Deposit
Agreement.
(i) “Eligible
Market”
means
the Principal Market, The New York Stock Exchange, Inc., the American Stock
Exchange or The Nasdaq Capital Market.
(j) “Expiration
Date”
means
the date that is sixty months after the Issuance Date or, if such date falls
on
a day other than a Business Day or on which trading does not take place on
the
Principal Market (a “Holiday”),
the
next date that is not a Holiday.
(k) “Fundamental
Transaction”
means
that the Company shall, directly or indirectly, in one or more related
transactions, (i) consolidate or merge with or into (whether or not the Company
is the surviving corporation) another Person, or (ii) sell, assign, transfer,
convey or otherwise dispose of all or substantially all of the properties or
assets of the Company to another Person, or (iii) allow another Person to make
a
purchase, tender or exchange offer that is accepted by the holders of more
than
the 50% of either the outstanding Ordinary Shares (not including any Ordinary
Shares held by the Person or Persons making or party to, or associated or
affiliated with the Persons making or party to, such purchase, tender or
exchange offer), or (iv) consummate a stock purchase agreement or other
business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another Person whereby
such other Person acquires more than the 50% of the outstanding Ordinary Shares
(not including any Ordinary Shares held by the other Person or other Persons
making or party to, or associated or affiliated with the other Persons making
or
party to, such stock purchase agreement or other business combination), or
(v)
reorganize, recapitalize or reclassify its Ordinary Shares.
(l) “Options”
means
any rights, warrants or options to subscribe for or purchase ADRs, Ordinary
Shares or Convertible Securities.
(m) “Ordinary
Shares”
means
(i) the Company’s ordinary shares of common stock, no par value per share,
and (ii) any share capital into which such Ordinary Shares shall have been
changed or any share capital resulting from a reclassification of such Ordinary
Shares.
(n) “Parent
Entity”
of
a
Person means an entity that, directly or indirectly, controls the applicable
Person and whose common stock or equivalent equity security is quoted or listed
on an Eligible Market, or, if there is more than one such Person or Parent
Entity, the Person or Parent Entity with the largest public market
capitalization as of the date of consummation of the Fundamental
Transaction.
(o) “Person”
means
an individual, a limited liability company, a partnership, a joint venture,
a
corporation, a trust, an unincorporated organization, any other entity and
a
government or any department or agency thereof.
(p) “Principal
Market”
means
the Nasdaq Global Market.
(q) “Registration
Rights Agreement”
means
that certain Second Amended and Restated Registration Rights Agreement by and
among the Company and the Buyers, as such agreement may be amended from time
to
time.
(r) “Required
Holders”
means
the holders of the SPA Warrants representing at least a majority of Warrant
Shares underlying the SPA Warrants then outstanding.
(s) “SPA
Securities”
means
the Notes issued pursuant to the Amendment Agreement.
(t) “Successor
Entity”
means
the Person, which may be the Company, formed by, resulting from or surviving
any
Fundamental Transaction or the Person with which such Fundamental Transaction
shall have been made, provided that if such Person is not a publicly traded
entity whose common stock or equivalent equity security is quoted or listed
for
trading on an Eligible Market, Successor Entity shall mean such Person’s Parent
Entity.
(u) “Trading
Day”
means
any day on which the ADRs are traded on the Principal Market, or, if the
Principal Market is not the principal trading market for the ADRs, then on
the
principal securities exchange or securities market on which the ADRs are then
traded; provided that “Trading Day” shall not include any day on which the ADRs
are scheduled to trade on such exchange or market for less than 4.5 hours or
any
day that the ADRs are suspended from trading during the final hour of trading
on
such exchange or market (or if such exchange or market does not designate in
advance the closing time of trading on such exchange or market, then during
the
hour ending at 4:00:00 p.m., New York Time).
(v) “Transaction
Documents”
has
the
meaning set forth in the Securities Purchase Agreement.
[Signature
Page Follows]
IN
WITNESS WHEREOF,
the
Company has caused this Warrant to Purchase ADRs to be duly executed as of
the
Issuance Date set out above.
PSIVIDA
LIMITED
Name: Michael
J. Soja
Title: Vice
President, Finance and Chief Financial Officer
EXHIBIT
A
EXERCISE
NOTICE
TO
BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS
WARRANT
TO PURCHASE ADRS
PSIVIDA
LIMITED
The
undersigned holder hereby exercises the right to purchase _________________
of
the ADRs, each of which representing ten (10) ordinary shares (“Ordinary
Shares”)
of
pSivida Limited, an Australian corporation (the “Company”),
evidenced by the attached Warrant to Purchase ADRs (the “Warrant”).
Capitalized terms used herein and not otherwise defined shall have the
respective meanings set forth in the Warrant.
1. Payment
of Exercise Price.
The
undersigned holder shall pay the Aggregate Exercise Price in the sum of
$___________________ to the Company in accordance with the terms of the
Warrant.
2. Delivery
of ADRs.
The
Company shall deliver to the holder __________ ADRs in accordance with the
terms
of the Warrant.
Date:
_______________ __, ______
_____________________________
Name
of
Registered Holder
By:
__________________________
Name:
Title:
ACKNOWLEDGMENT
The
Company hereby acknowledges this Exercise Notice and hereby directs
Citibank, N.A. to issue the above indicated number of Ordinary Shares in
accordance with the Transfer Agent Instructions dated _______________ from
the
Company and acknowledged and agreed to by Citibank, N.A.
PSIVIDA
LIMITED
By:
__________________________
Name:
Title:
