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EXHIBIT 4.7
VOID AFTER 5:00 P.M., CENTRAL STANDARD
TIME ON JANUARY 31, 2012
THE SECURITIES REPRESENTED BY THIS WARRANT HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES. THE SECURITIES REPRESENTED HEREBY MAY NOT BE OFFERED
OR SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS
OR UNLESS OFFERED, SOLD OR TRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THOSE LAWS.
Right to Purchase 5,079,792 Shares of
Common Stock, par value $.01 per share
No: W-2
Date: January 31, 2002
ALTERNATIVE RESOURCES CORPORATION
STOCK PURCHASE WARRANT
THIS CERTIFIES THAT, for value received, Wynnchurch Capital Partners
Canada, L.P. or its registered assigns (the "HOLDER"), is entitled to purchase
from ALTERNATIVE RESOURCES CORPORATION, a Delaware corporation (the "COMPANY"),
at any time or from time to time during the period specified in Section 2
hereof, 5,079,792 fully paid and nonassessable shares of the Company's Common
Stock, par value $.01 per share (the "COMMON STOCK"), at an exercise price of
$0.55 per share per share (the "EXERCISE PRICE"). This Warrant is one of a
series of Warrants being issued pursuant to that certain Securities Purchase
Agreement dated January 31, 2002 among the Company and the signatories thereto
(the "SECURITIES PURCHASE AGREEMENT," and all such warrants being issued
thereunder, the "WARRANTS"). Capitalized terms used herein and not otherwise
defined shall have the respective meanings set forth in the Securities Purchase
Agreement. The number of shares of Common Stock purchasable hereunder (the
"WARRANT SHARES") and the Exercise Price are subject to adjustment as provided
in Section 4 hereof.
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This Warrant is subject to the following terms, provisions, and conditions:
1. MECHANICS OF EXERCISE. This Warrant may be exercised as follows:
(a) MANNER OF EXERCISE. This Warrant may be exercised by the Holder,
in whole or in part, by the surrender of this Warrant (or evidence of loss,
theft, destruction or mutilation thereof in accordance with Section 7(c)
hereof), together with a completed exercise agreement in the Form of Exercise
Agreement attached hereto as Exhibit 1 (the "EXERCISE AGREEMENT"), to the
Company at the Company's principal executive offices (or such other office or
agency of the Company as it may designate by notice to the Holder), and upon (i)
payment to the Company in cash, by certified or official bank check or by wire
transfer for the account of the Company, of the Exercise Price for the Warrant
Shares specified in the Exercise Agreement or (ii) if the Holder elects to
effect a Cashless Exercise (as defined in Section 11(c) below), delivery to the
Company of a written notice of an election to effect a Cashless Exercise for the
Warrant Shares specified in the Exercise Agreement. The Warrant Shares so
purchased shall be deemed to be issued to the Holder or Holder's designees, as
the record owner of such shares, as of the date on which this Warrant shall have
been surrendered, the completed Exercise Agreement shall have been delivered,
and payment (or notice of an election to effect a Cashless Exercise) shall have
been made for such shares as set forth above.
(b) ISSUANCE OF CERTIFICATES. Certificates for the Warrant Shares so
purchased, representing the aggregate number of shares specified in the Exercise
Agreement, shall be delivered to the Holder within a reasonable time, not
exceeding three (3) business days, after this Warrant shall have been so
exercised (the "DELIVERY PERIOD"). The certificates so delivered shall be in
such denominations as may be requested by the Holder and shall be registered in
the name of Holder or such other name as shall be designated by such Holder. If
this Warrant shall have been exercised only in part, then, unless this Warrant
has expired, the Company shall, at its expense, at the time of delivery of such
certificates, deliver to the Holder a new Warrant representing the number of
shares with respect to which this Warrant shall not then have been exercised.
(c) FRACTIONAL SHARES. No fractional shares of Common Stock are to
be issued upon the exercise of this Warrant, but the Company shall pay a cash
adjustment in respect of any fractional share which would otherwise be issuable
in an amount equal to the same fraction of the fair market value of a share of
Common Stock (as determined by the Board of Directors in good faith); provided
that in the event that sufficient funds are not legally available for the
payment of such cash adjustment any fractional shares of Common Stock shall be
rounded up to the next whole number.
2. PERIOD OF EXERCISE. Subject to the last sentence of Section 4(e)
hereof, this Warrant is exercisable at any time or from time to time on or after
the date hereof and before 5:00 P.M., Central Standard Time on the tenth (10th)
anniversary of the date hereof (the "EXERCISE PERIOD").
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3. CERTAIN AGREEMENTS OF THE COMPANY. The Company hereby covenants and
agrees as follows:
(a) SHARES TO BE FULLY PAID. All Warrant Shares will, upon issuance
in accordance with the terms of this Warrant, be validly issued, fully paid, and
non-assessable and free from all taxes, liens, claims and encumbrances.
(b) RESERVATION OF SHARES. During the Exercise Period, the Company
shall at all times have authorized, and reserved for the purpose of issuance
upon exercise of this Warrant, a sufficient number of shares of Common Stock to
provide for the exercise of this Warrant.
(c) CERTAIN ACTIONS PROHIBITED. The Company will not, by amendment
of its charter or through any reorganization, transfer of assets, consolidation,
merger, 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 to be
observed or performed by it hereunder, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in the
taking of all such actions as may reasonably be requested by the Holder of this
Warrant in order to protect the exercise privilege of the Holder of this
Warrant, consistent with the tenor and purpose of this Warrant. Without limiting
the generality of the foregoing, the Company (i) will not increase the par value
of any shares of Common Stock receivable upon the exercise of this Warrant above
the Exercise Price then in effect, and (ii) will take all such actions as may be
necessary or appropriate in order that the Company may validly and legally issue
fully paid and nonassessable shares of Common Stock upon the exercise of this
Warrant.
4. ANTIDILUTION PROVISIONS. During the Exercise Period, the Exercise
Price and the number of Warrant Shares shall be subject to adjustment from time
to time as provided in this Section 4. In the event that any adjustment of the
Exercise Price as required herein results in a fraction of a cent, such Exercise
Price shall be rounded up or down to the nearest cent.
(a) ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF SHARES UPON ISSUANCE
OF COMMON STOCK. Except as otherwise provided in Section 4(c) and 4(e) hereof,
if and whenever after the initial issuance of this Warrant, the Company issues
or sells, or in accordance with Section 4(b) hereof is deemed to have issued or
sold, any shares of Common Stock for no consideration or for a consideration per
share less than the Exercise Price (as herein defined) on the date of such
issuance (a "DILUTIVE ISSUANCE"), then effective immediately upon the Dilutive
Issuance, the Exercise Price will be adjusted in accordance with the following
formula:
E'=(E) (O + (P/E)) / (CSDO)
where:
E' = the adjusted Exercise Price
E = the then current Exercise Price;
O = shall mean the number of shares of Common
Stock outstanding on a fully diluted basis
(not including shares of Common Stock held
in the treasury of the Company) including
Common Stock issuable upon exercise of the
Warrants (including the B-2 Warrants to the
extent not canceled) but excluding Common
Stock issuable upon
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exercise of the Notes, outstanding
immediately prior to the Dilutive Issuance;
P = the aggregate consideration, calculated
as set forth in Section 4(b) hereof,
received by the Company upon such Dilutive
Issuance;and
CSDO = the total number of shares of Common Stock
Deemed Outstanding (as herein defined)
immediately after the Dilutive Issuance.
(b) EFFECT ON EXERCISE PRICE OF CERTAIN EVENTS. For purposes of
determining the adjusted Exercise Price under Section 4(a) hereof, the following
will be applicable:
(i) ISSUANCE OF RIGHTS OR OPTIONS. If the Company in any
manner issues or grants any warrants, rights or options, whether or not
immediately exercisable, to subscribe for or to purchase Common Stock or other
securities directly or indirectly exercisable, convertible into or exchangeable
for Common Stock ("CONVERTIBLE SECURITIES") (such warrants, rights and options
to purchase Common Stock or Convertible Securities are hereinafter referred to
as "OPTIONS"), and the price per share for which Common Stock is issuable upon
the exercise of such Options is less than the Exercise Price on the date of
issuance ("BELOW MARKET OPTIONS"), then the maximum total number of shares of
Common Stock issuable upon the exercise of all such Below Market Options
(assuming full exercise, conversion or exchange of Convertible Securities, if
applicable) will, as of the date of the issuance or grant of such Below Market
Options, be deemed to be outstanding and to have been issued and sold by the
Company for such price per share. For purposes of the preceding sentence, the
price per share for which Common Stock is issuable upon the exercise of such
Below Market Options is determined by dividing (i) the total amount, if any,
received or receivable by the Company as consideration for the issuance or
granting of such Below Market Options, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the exercise of
all such Below Market Options, plus, in the case of Convertible Securities
issuable upon the exercise of such Below Market Options, the minimum aggregate
amount of additional consideration payable upon the exercise, conversion or
exchange thereof at the time such Convertible Securities first become
exercisable, convertible or exchangeable, by (ii) the maximum total number of
shares of Common Stock issuable upon the exercise of all such Below Market
Options (assuming full conversion of Convertible Securities, if applicable). No
further adjustment to the Exercise Price will be made upon the actual issuance
of such Common Stock upon the exercise of such Below Market Options or upon the
exercise, conversion or exchange of Convertible Securities issuable upon
exercise of such Below Market Options.
(ii) ISSUANCE OF CONVERTIBLE SECURITIES.
(A) If the Company in any manner issues or sells any
Convertible Securities, whether or not immediately convertible (other than where
the same are issuable upon the exercise of Options) and the price per share for
which Common Stock is issuable upon such exercise, conversion or exchange (as
determined pursuant to Section 4(b)(ii)(B) if applicable) is less than the
Exercise Price on the date of issuance, then the maximum total number of shares
of Common Stock issuable upon the exercise, conversion or exchange of all such
Convertible Securities will, as of the date of the issuance of such Convertible
Securities, be deemed to be outstanding and to have been issued and sold by the
Company for such price per share. For the purposes of the preceding sentence,
the price per
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share for which Common Stock is issuable upon such exercise, conversion or
exchange is determined by dividing (i) the total amount, if any, received or
receivable by the Company as consideration for the issuance or sale of all such
Convertible Securities, plus the minimum aggregate amount of additional
consideration, if any, payable to the Company upon the exercise, conversion or
exchange thereof at the time such Convertible Securities first become
exercisable, convertible or exchangeable, by (ii) the maximum total number of
shares of Common Stock issuable upon the exercise, conversion or exchange of all
such Convertible Securities. No further adjustment to the Exercise Price will be
made upon the actual issuances of such Common Stock upon exercise, conversion or
exchange of such Convertible Securities.
(B) If the Company in any manner issues or sells any
Convertible Securities with a fluctuating conversion or exercise price or
exchange ratio (a "VARIABLE RATE CONVERTIBLE SECURITY"), then the price per
share for which Common Stock is issuable upon such exercise, conversion or
exchange for purposes of the calculation contemplated by Section 4(b)(ii)(A)
shall be deemed to be the lowest price per share which would be applicable
assuming that all holding periods and other conditions to any discounts
contained in such Convertible Security have been satisfied.
(iii) CHANGE IN OPTION PRICE OR CONVERSION RATE. If there is a
change at any time in (i) the amount of additional consideration payable to the
Company upon the exercise of any Options; (ii) the amount of additional
consideration, if any, payable to the Company upon the exercise, conversion or
exchange or any Convertible Securities; or (iii) the rate at which any
Convertible Securities are convertible into or exchangeable for Common Stock
(other than under or by reason of provisions designed to protect against
dilution), the Exercise Price in effect at the time of such change will be
readjusted to the Exercise Price which would have been in effect at such time
had such Options or Convertible Securities still outstanding provided for such
changed additional consideration or changed conversion rate, as the case may be,
at the time initially granted, issued or sold.
(iv) TREATMENT OF EXPIRED OPTIONS AND UNEXERCISED CONVERTIBLE
SECURITIES. If, in any case, the total number of shares of Common Stock issuable
upon exercise of any Options or upon exercise, conversion or exchange of any
Convertible Securities is not, in fact, issued and the rights to exercise such
option or to exercise, convert or exchange such Convertible Securities shall
have expired or terminated, the Exercise Price then in effect will be readjusted
to the Exercise Price which would have been in effect at the time of such
expiration or termination had such Options or Convertible Securities, to the
extent outstanding immediately prior to such expiration or termination (other
than in respect of the actual number of shares of Common Stock issued upon
exercise or conversion thereof), never been issued.
(v) CALCULATION OF CONSIDERATION RECEIVED. If any Common
Stock, Options or Convertible Securities are issued, granted or sold for cash,
the consideration received therefor for purposes of this Warrant will be the
amount received by the Company therefor, before deduction of reasonable
commissions, underwriting discounts or allowances or other reasonable expenses
paid or incurred by the Company in connection with such issuance, grant or sale,
plus the minimum aggregate amount of additional consideration, if any, payable
to the Company upon the exercise, conversion or exchange of all such Options or
Convertible Securities at the time such Options or Convertible Securities first
become exercisable,
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convertible or exchangeable. In case any Common Stock, Options or Convertible
Securities are issued or sold for a consideration part or all of which shall be
other than cash, the amount of the consideration other than cash received by the
Company will be the fair market value of such consideration except where such
consideration consists of freely-tradeable securities, in which case the amount
of consideration received by the Company will be the Market Price thereof as of
the date of receipt. In case any Common Stock, Options or Convertible Securities
are issued in connection with any merger or consolidation in which the Company
is the surviving corporation, the amount of consideration therefor will be
deemed to be the fair market value of such portion of the net assets and
business of the non-surviving corporation as is attributable to such Common
Stock, Options or Convertible Securities, as the case may be. The fair market
value of any consideration other than cash or securities will be determined in
the good faith reasonable business judgment of the Board of Directors, provided,
however, that in any case where the aggregate value of such consideration
exceeds Five Million Dollars ($5,000,000) such valuation is subject to the
reasonable approval of the Holders of the Warrants holding at least a majority
of the Warrant Shares then exercisable thereunder (the "MAJORITY HOLDERS"). If
the Company and the Majority Holders are unable to agree upon the valuation set
forth in the prior sentence, the valuation will be determined by an independent,
nationally recognized accounting form selected by the Company and reasonably
acceptable to the Majority Holders, the costs of which will be borne by the
Company.
(vi) EXCEPTIONS TO ADJUSTMENT OF EXERCISE PRICE. No adjustment
to the Exercise Price will be made (i) upon the exercise of any warrants,
options or convertible securities issued and outstanding on the date hereof in
accordance with the terms of such securities as of such date; (ii) upon the
issuance of Notes in accordance with terms of the Securities Purchase Agreement;
(iii) upon the exercise of the Warrants (including the B-2 Warrants); or (iv)
upon conversion of the Notes.
(c) SUBDIVISION OR COMBINATION OF COMMON STOCK. If the Company, at
any time after the initial issuance of this Warrant, subdivides (by any stock
split, stock dividend, recapitalization, reorganization, reclassification or
otherwise) its shares of Common Stock into a greater number of shares, then,
after the date of record for effecting such subdivision, the Exercise Price in
effect immediately prior to such subdivision will be proportionately reduced. If
the Company, at any time after the initial issuance of this Warrant, combines
(by reverse stock split, recapitalization, reorganization, reclassification or
otherwise) its shares of Common Stock into a smaller number of shares, then,
after the date of record for effecting such combination, the Exercise Price in
effect immediately prior to such combination will be proportionately increased.
(d) ADJUSTMENT IN NUMBER OF SHARES. Upon each adjustment of the
Exercise Price pursuant to the provisions of this Section 4, the number of
shares of Common Stock issuable upon exercise of this Warrant shall be adjusted
by multiplying a number equal to the Exercise Price in effect immediately prior
to such adjustment by the number of shares of Common Stock issuable upon
exercise of this Warrant immediately prior to such adjustment and dividing the
product so obtained by the adjusted Exercise Price.
(e) MAJOR TRANSACTIONS. If the Company shall consolidate or merge
with any other corporation or entity (other than a merger in which the Company
is the surviving or continuing entity and its capital stock is unchanged and
unissued in such transaction which does
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not result in a Change of Control (as defined in the Note)) or there shall occur
any share exchange pursuant to which all of the outstanding shares of Common
Stock are converted into other securities or property or any reclassification or
change of the outstanding shares of Common Stock or the Company shall sell all
or substantially all of its assets (each of the foregoing being a "MAJOR
TRANSACTION"), then the holder of this Warrant may, at its option, either (a) in
the event that the Common Stock remains outstanding and continues to be held
immediately following the transactions by those persons holding Common Stock
immediately prior to such transaction or holders of Common Stock receive any
common stock or substantially similar equity interest, and the Common Stock of
the Purchaser or the resulting company, as the case may be, is registered
pursuant to the Securities Act and the Exchange Act, retain this Warrant and
this Warrant shall continue to apply to such Common Stock or shall apply, as
nearly as practicable, to such other common stock or equity interest, as the
case may be (with such equitable adjustments to the Exercise Price as may be
appropriate), or (b) regardless of whether (a) applies, receive consideration,
in exchange for this Warrant, equal to the number of shares of stock or
securities or property of the Company, or of the entity resulting from such
Major Transaction (the "MAJOR TRANSACTION CONSIDERATION"), to which a holder of
the number of shares of Common Stock delivered upon the exercise of this Warrant
(pursuant to the cashless exercise feature hereof) would have been entitled upon
such Major Transaction had such holder so exercised this Warrant on the trading
date immediately preceding the public announcement of the transaction resulting
in such Major Transaction and had such Common Stock been issued and outstanding
and had such Holder been the holder of record of such Common Stock at the time
of the consummation of such Major Transaction, and the Company shall make lawful
provision for the foregoing as a part of such Major Transaction and to the
extent that any replacement shares for the Common Stock are not able to be sold
immediately and in full by Holder without registration of such shares under the
Securities Act, shall cause the issuer of any security in such transaction which
constitutes Registrable Securities under that certain Registration Rights
Agreement of even date herewith among the Company and the signatories thereto
(the "REGISTRATION RIGHTS AGREEMENT") to assume all of the Company's obligations
under the Registration Rights Agreement. No later than ten (10) days prior to
the consummation of the Major Transaction but not prior to the public
announcement of such Major Transaction, the Company shall deliver written notice
("NOTICE OF TRANSACTION") to each holder of a Warrant, which Notice of
Transaction shall be deemed to have been delivered one (1) business day after
the Company's sending such notice by telecopy (provided that the Company sends a
confirming copy of such notice on the same day by overnight courier) of such
Notice of Transaction. Such Notice of Transaction shall indicate the amount and
type of the transaction consideration which such holder of a Warrant would
receive under this section ("TRANSACTION CONSIDERATION"). If the Transaction
Consideration is cash and does not consist entirely of United States currency,
such holder may elect to receive United States currency in an amount equal to
the value of the Transaction Consideration in lieu of the Transaction
Consideration by delivering notice of such election to the Company within ten
(10) days of such holder's receipt of the Notice of Transaction which notice
shall also set forth whether Holder chooses to avail itself of any of the
options under this Section 4(e). If neither (a) nor (b) of this Section 4(e) is
elected by Holder, or this Warrant is not otherwise exercised, this Warrant
shall expire on the consummation of a Major Transaction.
(f) DISTRIBUTION OF ASSETS. In case the Company shall declare or
make any distribution of its assets (or rights to acquire its assets) to holders
of Common Stock as a partial
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liquidating dividend, by way of return of capital or otherwise (including any
dividend or distribution to the Company's stockholders of cash or shares (or
rights to acquire shares) of capital stock of a subsidiary) (a "DISTRIBUTION"),
at any time after the initial issuance of this Warrant, then the Holder shall be
entitled upon exercise of this Warrant for the purchase of any or all of the
shares of Common Stock subject hereto, to receive the amount of such assets (or
rights) which would have been payable to the Holder had such Holder been the
holder of such shares of Common Stock on the record date for the determination
of stockholders entitled to such Distribution.
(g) NOTICES OF ADJUSTMENT. Upon the occurrence of any event which
requires any adjustment of the Exercise Price, then, and in each such case, the
Company shall give notice thereof to the Holder, which notice shall state the
Exercise Price resulting from such adjustment and the increase or decrease in
the number of Warrant Shares purchasable at such price upon exercise, setting
forth in reasonable detail the method of calculation and the facts upon which
such calculation is based. Such calculation shall be certified by the Chief
Financial Officer of the Company.
(h) MINIMUM ADJUSTMENT OF EXERCISE PRICE. No adjustment of the
Exercise Price shall be made in an amount of less than 1% of the Exercise Price
in effect at the time such adjustment is otherwise required to be made, but any
such lesser adjustment shall be carried forward and shall be made at the time
and together with the next subsequent adjustment which, together with any
adjustments so carried forward, shall amount to not less than 1% of such
Exercise Price. Other than pursuant to Sections 4(b)(iii) and 4(b)(iv) hereof,
no adjustment under Section 4(a) shall have the effect of increasing the
Exercise Price.
(i) OTHER NOTICES. In case at any time:
(i) the Company shall declare any dividend upon the Common
Stock payable in shares of stock of any class or make any other distribution to
the holders of the Common Stock;
(ii) the Company shall offer for subscription pro rata to the
holders of the Common Stock any additional shares of stock of any class or other
rights;
(iii) there shall be any capital reorganization of the Company,
or reclassification of the Common Stock, or consolidation or merger of the
Company with or into, or sale of all or substantially all of its assets to,
another corporation or entity; or
(iv) there shall be a voluntary or involuntary dissolution,
liquidation or winding-up of the Company;
then, in each such case, the Company shall give to the Holder (x) notice of the
date on which the books of the Company shall close or a record shall be taken
for determining the holders of Common Stock entitled to receive any such
dividend, distribution, or subscription rights or for determining the holders of
Common Stock entitled to vote in respect of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding-up and (y) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding-up, notice of
the date (or, if not then known, a reasonable approximation
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thereof by the Company) when the same shall take place. Such notice shall also
specify the date on which the holders of Common Stock shall be entitled to
receive such dividend, distribution, or subscription rights or to exchange their
Common Stock for stock or other securities or property deliverable upon such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation, or winding-up, as the case may be. Such notice shall be given at
least 30 days prior to the record date or the date on which the Company's books
are closed in respect thereto, but in no event earlier than public announcement
of such proposed transaction or event.
(j) CERTAIN DEFINITIONS.
(i) "COMMON STOCK DEEMED OUTSTANDING" shall mean the number
of shares of Common Stock outstanding on a fully diluted basis (not including
shares of Common Stock held in the treasury of the Company) including Common
Stock issuable upon exercise of the Warrants (including the B-2 Warrants to the
extent not canceled) but excluding Common Stock issuable upon conversion of the
Notes, plus (x) in case of any adjustment required by Section 4(a) resulting
from the issuance of any Options, the maximum total number of shares of Common
Stock issuable upon the exercise of the Options for which the adjustment is
required (including any Common Stock issuable upon the conversion of Convertible
Securities issuable upon the exercise of such Options), and (y) in the case of
any adjustment required by Section 4(a) resulting from the issuance of any
Convertible Securities, the maximum total number of shares of Common Stock
issuable upon the exercise, conversion or exchange of the Convertible Securities
for which the adjustment is required, as of the date of issuance of such
Convertible Securities, if any.
(ii) "MARKET PRICE," means, as of any date, the average of
the Closing Bid prices for the Common Stock during the ten (10) consecutive
trading days immediately preceding, but not including, such determination date;
provided, however, that in the case of a calculation of Market Price made in
connection with a public offering of securities, for purposes of Section 4, the
Market Price shall be the closing bid price on the day of pricing of such public
offering.
(iii) "COMMON STOCK," for purposes of this Section 4, includes
the Common Stock and any additional class of stock of the Company having no
preference as to dividends or distributions on liquidation, provided that the
shares purchasable pursuant to this Warrant shall include only Common Stock in
respect of which this Warrant is exercisable, or shares resulting from any
subdivision or combination of such Common Stock, or in the case of any
reorganization, reclassification, consolidation, merger, or sale of the
character referred to in Section 4(e) hereof, the stock or other securities or
property provided for in such Section.
(iv) "CLOSING BID PRICE" means, for any security as of any
date, the closing bid price of such security on the principal securities
exchange or trading market where such security is listed or traded as reported
by Bloomberg Financial Markets or a comparable reporting service of national
reputation selected by the Company and reasonably acceptable to Holders of a
majority of the aggregate principal amount represented by the then outstanding
Notes (with the consent of the Holder so long as the Holder continues to own
Notes) ("MAJORITY HOLDERS") if Bloomberg Financial Markets is not then reporting
closing bid prices of such security (collectively, "BLOOMBERG"), or if the
foregoing does not apply, the last reported sale
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price of such security in the over-the-counter market on the electronic bulletin
board of such security as reported by Bloomberg, or, if no sale price is
reported for such security by Bloomberg, the average of the bid prices of any
market makers for such security as reported in the "pink sheets" by the National
Quotation Bureau, Inc. If the Closing Bid Price cannot be calculated for such
security on such date on any of the foregoing bases, the Closing Bid Price of
such security on such date shall be the fair market value as reasonably
determined by an investment banking firm selected by the Company and reasonably
acceptable to the Holder, with the costs of such determination to be borne by
the Company.
5. ISSUE TAX. The issuance of certificates for Warrant Shares upon the
exercise of this Warrant shall be made without charge to the Holder or such
shares for any issuance tax or other costs in respect thereof, provided that the
Company shall not be required to pay any tax which may be payable in respect of
any transfer involved in the issuance and delivery of any certificate in a name
other than the Holder.
6. NO RIGHTS OR LIABILITIES AS A STOCKHOLDER. This Warrant shall not
entitle the Holder to any voting rights or other rights as a stockholder of the
Company. No provision of this Warrant, in the absence of affirmative action by
the Holder to purchase Warrant Shares, and no mere enumeration herein of the
rights or privileges of the Holder, shall give rise to any liability of the
Holder for the Exercise Price or as a stockholder of the Company, whether such
liability is asserted by the Company or by creditors of the Company.
7. TRANSFER, EXCHANGE, REDEMPTION AND REPLACEMENT OF WARRANT.
(a) RESTRICTION ON TRANSFER. This Warrant and the rights granted to
the Holder are transferable, in whole or in part, upon surrender of this
Warrant, together with a properly executed assignment in the Form of Assignment
attached hereto as Exhibit 2, at the office or agency of the Company referred to
in Section 7(e) below. Until due presentment for registration of transfer on the
books of the Company, the Company may treat the registered holder hereof as the
owner and holder hereof for all purposes, and the Company shall not be affected
by any notice to the contrary. Notwithstanding anything to the contrary
contained herein, the registration rights described in Section 8 hereof are
assignable only in accordance with the provisions of the Registration Rights
Agreement. Until this Warrant or the shares represented by this Warrant are
registered under the Securities Act, the Company may require, as a condition of
transfer of this Warrant or the shares represented by this Warrant, that the
transferee (who may be the Holder in the case of an exchange) represent that the
securities being transferred are being acquired for investment purposes and for
the transferee's own account and not with a view to or for sale in connection
with any distribution of the security. The Company may also require that the
transferee provide written information adequate to establish that the transferee
is an "accredited investor" within the meaning of Regulation D issued under the
Securities Act, or otherwise meets all qualifications necessary to comply with
exemptions to the Securities Act, all as determined by counsel to the Company.
(b) WARRANT EXCHANGEABLE FOR DIFFERENT DENOMINATIONS. This Warrant
is exchangeable, upon the surrender hereof by the Holder at the office or agency
of the Company referred to in Section 7(e) below, for new Warrants, in the form
hereof, of different denominations representing in the aggregate the right to
purchase the number of shares of
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Common Stock which may be purchased hereunder, each of such new
Warrants to represent the right to purchase such number of shares as shall be
designated by the Holder of at the time of such surrender.
(c) REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction, or mutilation of
this Warrant or, in the case of any such loss, theft, or destruction, upon
delivery, of an indemnity agreement reasonably satisfactory in form and amount
to the Company, or, in the case of any such mutilation, upon surrender and
cancellation of this Warrant, the Company, at its expense, will execute and
deliver, in lieu thereof, a new Warrant, in the form hereof, in such
denominations as Holder may request.
(d) CANCELLATION; PAYMENT OF EXPENSES. Upon the surrender of this
Warrant in connection with any transfer, exchange, or replacement as provided in
this Section 8, this Warrant shall be promptly canceled by the Company. The
Company shall pay all issuance taxes (other than securities transfer taxes) and
charges payable in connection with the preparation, execution, and delivery of
Warrants pursuant to this Section 7.
(e) WARRANT REGISTER. The Company shall maintain, at its principal
executive offices (or such other office or agency of the Company as it may
designate by notice to the Holder), a register for this Warrant, in which the
Company shall record the name and address of the person in whose name this
Warrant has been issued, as well as the name and address of each transferee and
each prior owner of this Warrant.
8. REGISTRATION. The initial holder of this Warrant (and certain
assignees thereof) is entitled to the benefit of such registration
rights in respect of the Warrant Shares as are set forth in the Registration
Rights Agreement between the company and the initial holder of this Warrant.
9. NOTICES. Any notice herein required or permitted to be given shall be
in writing and may be personally served or delivered by courier or by telecopy
(confirmed by sending a copy by first class mail or courier within one day of
sending by telecopy), and shall be deemed delivered at the time and date of
receipt (which shall include facsimile transmission). The addresses for such
communications shall be:
If to the Company:
Alternative Resources Corporation 600 Hart Road, Suite 300
Barrington, Illinois 60010
Telecopy: 847-381-6604
Attention: Steven Purcell, Chief Financial Officer
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with a copy to:
McDermott, Will & Emery
227 West Monroe Street
Chicago, Illinois 60606
Telecopy: 312-984-7700
Attention: Neal J. White
and if to the Holder, at such address as Holder shall have provided in writing
to the Company, or at such other address as each such party furnishes by notice
given in accordance with this Section 9.
10. GOVERNING LAW; JURISDICTION. This Warrant shall be governed by and
construed in accordance with the laws of the State of Illinois applicable to
contracts made and to be performed in the State of Illinois. The Company
irrevocably consents to the jurisdiction of the United States federal courts
located in the State of Illinois and the state courts located in the County of
Cook in the State of Illinois in any suit or proceeding based on or arising
under this Warrant and irrevocably agrees that all claims in respect of such
suit or proceeding may be determined in such courts. The Company irrevocably
waives the defense of an inconvenient forum to the maintenance of such suit or
proceeding. The Company agrees that a final nonappealable judgment in any such
suit or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on such judgment or in any other lawful manner. The
Company acknowledges that a breach by it of its obligations hereunder will cause
irreparable harm to the Holders of the Warrants and that the remedy at law for
any such breach or threatened breach, the Holders shall be entitled, in addition
to all other available remedies, to specific performance or an injunction
restraining any breach, without the necessity of showing economic loss and
without any bond or other security being required. TO THE EXTENT NOT PROHIBITED
BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH OF THE COMPANY AND HOLDER HEREBY
WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT
OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE,
CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS
WARRANT OR THE SUBJECT MATTER HEREOF OR ANY OBLIGATION HEREUNDER OR IN ANY WAY
CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE HOLDERS OR THE
COMPANY OR ANY OF THEM IN CONNECTION WITH ANY OF THE ABOVE, IN EACH CASE WHETHER
NOW EXISTING OR HEREAFTER ARISING AND WHETHER SOUNDING IN CONTRACT OR TORT OR
OTHERWISE. EACH OF HOLDER AND THE COMPANY ACKNOWLEDGES THAT THE PROVISIONS OF
THIS SECTION 10 CONSTITUTE A MATERIAL INDUCEMENT UPON WHICH EACH OF HOLDER AND
THE COMPANY HAVE RELIED, ARE RELYING AND WILL RELY IN ENTERING INTO THIS
AGREEMENT, AND EACH OF THE RELATED AGREEMENTS. Holder or the Company may file an
original counterpart or a copy of this Section 10 with any court as written
evidence of the consent of the parties hereto to the waiver of their respective
right to trial by jury.
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11. MISCELLANEOUS.
(a) AMENDMENTS. This Warrant and any provision hereof may only be
amended by an instrument in writing signed by the Company and the Holder.
(b) DESCRIPTIVE HEADINGS. The descriptive headings of the several
Sections of this Warrant are inserted for purposes of reference only, and shall
not affect the meaning or construction of any of the provisions hereof.
(c) CASHLESS EXERCISE. Notwithstanding anything to the contrary
contained in this Warrant, this Warrant may be exercised by presentation and
surrender of this Warrant to the Company at its principal executive offices with
a written notice of the Holder's intention to effect a cashless exercise,
including a calculation of the number of shares of Common Stock to be issued
upon such exercise in accordance with the terms hereof (a "CASHLESS EXERCISE").
In the event of a Cashless Exercise, in lieu of paying the Exercise Price in
cash, the Holder shall surrender this Warrant for the number of shares of Common
Stock determined by multiplying the number of Warrant Shares to which it would
otherwise be entitled by a fraction, the numerator of which shall be the
difference between the then current Market Price per share of the Common Stock
and the Exercise Price, and the denominator of which shall be such then current
Market Price per share of Common Stock.
(d) ASSIGNABILITY. This Warrant shall be binding upon the Company
and its successors and assigns and shall inure to the benefit of Holder and its
successors and assigns. The Holder shall notify the Company upon the assignment
of this Warrant.
* * *
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IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
duly authorized officer.
ALTERNATIVE RESOURCES CORPORATION
By: /s/ Steven Purcell
------------------------------------------------
Name: Steven Purcell
Title: Senior Vice President and Chief Financial
Officer
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FORM OF EXERCISE AGREEMENT
(To be Executed by the Holder in order to Exercise the Warrant)
The undersigned hereby irrevocably exercises the right to purchase
____________ of the shares of common stock of Alternative Resources Corporation,
a Delaware corporation (the "COMPANY"), evidenced by the attached Warrant, and
[HEREWITH MAKES PAYMENT OF THE EXERCISE PRICE WITH RESPECT TO SUCH SHARES IN
FULL] [ELECTS TO EFFECT A CASHLESS EXERCISE PURSUANT TO THE TERMS OF THE
WARRANT], all in accordance with the conditions and provisions of said Warrant.
(i) The undersigned agrees not to offer, sell, transfer or otherwise
dispose of any Common Stock obtained on exercise of the Warrant, except under
circumstances that will not result in a violation of the Securities Act of 1933,
as amended, or any state securities laws.
(ii) The undersigned requests that stock certificates for such shares be
issued, and a Warrant representing any unexercised portion hereof be issued,
pursuant to the Warrant in the name of the Holder (or such other person or
persons indicated below) and delivered to the undersigned (or designee(s) at the
address (or addresses) set forth below:
Date:------------------------------- -----------------------------
Signature of Holder
------------------------------
Name of Holder (Print)
Address:
-----------------------------
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FORM OF ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
all rights of the undersigned under the within Warrant, with respect to the
number of shares of Common Stock covered thereby set forth hereinbelow, to:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
, and hereby irrevocably constitutes and appoints ______________________________
as agent and attorney-in-fact to transfer said Warrant on the books of the
within-named corporation, with full power of substitution in the premises.
Date:
------------, -----,
In the presence of
- ---------------------------
Name:
-------------------------------------
Signature:
--------------------------------
Title of Signing Officer or
Agent (if any):
--------------------------
Address:
-------------------
-------------------
Note: The above
signature should
correspond exactly
with name on the
face of the within
Warrant.