Exhibit 10.1
AMENDMENT No. 1 to the WARRANT AGREEMENT
This Amendment No. 1, dated as of January 7, 2004, amends
the Warrant Agreement dated as of January 5, 2004 (the "Initial Warrant
Agreement" and, as amended by this Amendment, the "Warrant Agreement") between
Magellan Health Services, Inc. (the "Company"), and Wachovia Bank, National
Association, as Warrant Agent (the "Warrant Agent").
WHEREAS, as required by the Third Amended Joint Plan of
Reorganization of the Company and certain of its subsidiaries (the "Chapter 11
Plan"), as confirmed by order of the U.S. Bankruptcy Court for the Southern
District of New York filed by the court on October 8, 2003 (the "Confirmation
Order"), the Company and the Warrant Agent entered into the Warrant Agreement
substantially in the form of an exhibit to the Chapter 11 Plan in order to
create and provide for the issuance by the Company in required by and accordance
with the Chapter 11 Plan of 570,826 warrants (the "Warrants") to purchase shares
of Ordinary Common Stock, par value $ 0.01 per share, of the Company (the
"Common Stock"); and
WHEREAS, in connection with the consummation of the Chapter
11 Plan and the preparation of the definitive form of the Initial Warrant
Agreement as executed, a clerical error was made by the Company in calculating
the per share purchase price of a share of Common Stock pursuant to the Warrants
that is to be applicable in accordance with the Chapter 11 Plan, specifically in
including in Section 1 of the Initial Warrant Agreement, in the definition of
the "Exercise Price" of a Warrant, the amount of $30.20 which does not accord
with the requirements of the Chapter 11 Plan and the Confirmation Order with
respect to the exercise price of the Warrants; and
WHEREAS, in accordance with Section 14.4(b) of the Warrant
Agreement, the Company and the Warrant Agent may from time to time amend the
Warrant Agreement, without the approval of any holder of Warrants, in order to
cure any manifest error or other mistake in the Warrant Agreement or to correct
any provision contained in the Warrant Agreement that may be defective or to
make any other provision in regard to matters or questions arising under the
Warrant Agreement that the Company and the Warrant Agent may deem necessary and
desirable and that do not adversely affect, alter or change the interests of the
holders of Warrants;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereto agree as follows:
1. Defined Terms. Capitalized terms used herein and not otherwise defined
herein shall have the meaning given to them in the Initial Warrant
Agreement.
2. Amendment to Section 1, Definition of "Exercise Price." The parties hereto
hereby agree that the definition of "Exercise Price" in section 1 of the
Initial Warrant Agreement is amended by deleting the definition in its
entirety and replacing it with the sentence below, this amendment being a
correction of a manifest error in the Initial Warrant Agreement to reflect
the intention of the parties as of the date of the Initial Warrant
Agreement and compliance with the Chapter 11 Plan and the Confirmation
Order:
"Exercise Price" shall be equal to $30.46 per share of
Common Stock, as such price may be adjusted pursuant to Section 6 of
this Agreement."
3. Restatement of the Warrant Agreement. In order to avoid confusion
regarding the terms of the Warrant Agreement, the Initial Warrant
Agreement is hereby restated as amended by this Amendment No. 1 to read in
its entirety as set forth in the Restated Warrant Agreement, dated as of
January 5, 2004, attached hereto (the "Restated Warrant Agreement"), which
the parties hereto are simultaneously executing.
4. No Other Amendments. Except as set forth above, the terms and provisions
of the Initial Warrant Agreement are hereby confirmed. This Amendment No.
1 constitutes the entire agreement between the parties relating to the
subject matter hereof and the Restated Warrant Agreement constitutes the
entire agreement of the parties relating to the Warrants and supersedes
the Initial Warrant Agreement.
5. Governing Law. This Amendment No. 1 shall be governed by the laws of the
State of New York, without regard to the principles, policies or
provisions thereof relating to choice or conflict of laws.
6. Counterparts. This Amendment No. 1 may be executed in any number of
counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together
constitute but one and the same instrument.
7. Headings. The headings used in this Amendment No. 1 are for the
convenience of reference only and shall not, for any purpose, be deemed a
part of this Amendment No. 1.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment No. 1 to be duly executed as of the day first above written.
MAGELLAN HEALTH SERVICES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
WACHOVIA BANK, NATIONAL ASOCIATION,
As Warrant Agent
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President