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EXHIBIT 4.8
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HNC SOFTWARE INC.
AND
STATE STREET BANK AND TRUST COMPANY
OF CALIFORNIA, N.A.
TRUSTEE
INDENTURE
DATED AS OF MARCH 1, 1998
__% CONVERTIBLE SUBORDINATED NOTES DUE 2003
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS..........................................................................1
Section 1.1 Definitions...............................................................1
ARTICLE II ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES...................8
Section 2.1 Designation, Amount and Issue of Notes....................................8
Section 2.2 Form of Notes.............................................................9
Section 2.3 Date and Denomination of Notes; Payments of Interest......................9
Section 2.4 Execution of Notes.......................................................11
Section 2.5 Exchange and Registration of Transfer of Notes...........................11
Section 2.6 Mutilated, Destroyed, Lost or Stolen Notes...............................12
Section 2.7 Temporary Notes..........................................................13
Section 2.8 Cancellation of Notes Paid, Etc..........................................14
ARTICLE III REDEMPTION OF NOTES...............................................................14
Section 3.1 Right of Redemption......................................................14
Section 3.2 Applicability of Article.................................................14
Section 3.3 Election to Redeem; Notice to Trustee....................................14
Section 3.4 Selection by Trustee of Notes to Be Redeemed.............................15
Section 3.5 Notice of Redemption.....................................................15
Section 3.6 Deposit of Redemption Price..............................................16
Section 3.7 Notes Payable on Redemption Date.........................................16
Section 3.8 Notes Redeemed in Part...................................................17
Section 3.9 Conversion Arrangement on Call for Redemption............................17
ARTICLE IV SUBORDINATION OF NOTES.............................................................18
Section 4.1 Agreement of Subordination...............................................18
Section 4.2 Payments to Holders......................................................18
Section 4.3 Subrogation of Notes.....................................................21
Section 4.4 Authorization to Effect Subordination....................................22
Section 4.5 Notice to Trustee........................................................22
Section 4.6 Trustee's Relation to Senior Indebtedness of the Company.................23
Section 4.7 No Impairment of Subordination...........................................24
Section 4.8 Article Applicable to Paying Agents......................................24
Section 4.9 Senior Indebtedness of the Company Entitled to Rely......................24
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TABLE OF CONTENTS
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Section 4.10 Certain Conversions Deemed Payment.......................................24
ARTICLE V PARTICULAR COVENANTS OF THE COMPANY.................................................25
Section 5.1 Payment of Principal, Premium and Interest...............................25
Section 5.2 Maintenance of Office or Agency..........................................25
Section 5.3 Appointments to Fill Vacancies in Trustee's Office.......................26
Section 5.4 Provisions as to Paying Agent............................................26
Section 5.5 Existence................................................................27
Section 5.6 Stay, Extension and Usury Laws...........................................27
Section 5.7 Statement by Officers as to Default......................................27
Section 5.8 Further Instruments and Acts.............................................28
ARTICLE VI HOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE..........................28
Section 6.1 Holders' Lists...........................................................28
Section 6.2 Preservation and Disclosure of Lists.....................................28
Section 6.3 Reports by Trustee.......................................................29
Section 6.4 Reports by Company.......................................................29
ARTICLE VII DEFAULTS AND REMEDIES.............................................................29
Section 7.1 Events of Default........................................................29
Section 7.2 Payments of Notes on Default; Suit Therefor..............................31
Section 7.3 Application of Monies Collected by Trustee...............................33
Section 7.4 Proceedings by Holder....................................................34
Section 7.5 Proceedings by Trustee...................................................35
Section 7.6 Remedies Cumulative and Continuing.......................................35
Section 7.7 Direction of Proceedings and Waiver of Defaults by Majority of Holders ..35
Section 7.8 Notice of Defaults.......................................................36
Section 7.9 Undertaking to Pay Costs.................................................36
Section 7.10 Delay or Omission Not Waiver.............................................36
ARTICLE VIII CONCERNING THE TRUSTEE...........................................................36
Section 8.1 Duties and Responsibilities of Trustee...................................36
Section 8.2 Reliance on Documents, Opinions, Etc.....................................38
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TABLE OF CONTENTS
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Section 8.3 No Responsibility for Recitals, Etc......................................39
Section 8.4 Trustee, Paying Agents, Conversion Agents or Registrar May Own Notes ....39
Section 8.5 Monies to Be Held in Trust...............................................39
Section 8.6 Compensation and Expenses of Trustee.....................................39
Section 8.7 Officers' Certificate as Evidence........................................40
Section 8.8 Conflicting Interests of Trustee.........................................40
Section 8.9 Eligibility of Trustee...................................................40
Section 8.10 Resignation or Removal of Trustee........................................40
Section 8.11 Acceptance by Successor Trustee..........................................42
Section 8.12 Succession by Merger, Etc................................................42
Section 8.13 Limitation on Rights of Trustee as Creditor..............................43
ARTICLE IX CONCERNING THE HOLDERS.............................................................43
Section 9.1 Action by Holders........................................................43
Section 9.2 Proof of Execution by Holders............................................43
Section 9.3 Who Are Deemed Absolute Owners...........................................44
Section 9.4 Company-Owned Notes Disregarded..........................................44
Section 9.5 Revocation of Consents; Future Holders Bound.............................44
ARTICLE X HOLDERS' MEETINGS...................................................................45
Section 10.1 Purpose of Meetings......................................................45
Section 10.2 Call of Meetings by Trustee..............................................45
Section 10.3 Call of Meetings by Company or Holders...................................46
Section 10.4 Qualifications for Voting................................................46
Section 10.5 Regulations..............................................................46
Section 10.6 Voting...................................................................47
Section 10.7 No Delay of Rights by Meeting............................................47
ARTICLE XI SUPPLEMENTAL INDENTURES............................................................47
Section 11.1 Supplemental Indentures Without Consent of Holders.......................47
Section 11.2 Supplemental Indentures With Consent of Holders..........................49
Section 11.3 Effect of Supplemental Indentures........................................49
Section 11.4 Notation on Notes........................................................50
Section 11.5 Evidence of Compliance of Supplemental Indenture to Be
Furnished Trustee.......................................................50
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TABLE OF CONTENTS
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ARTICLE XII MERGER, SALE OR CONSOLIDATION.....................................................50
Section 12.1 Limitation on Merger, Sale or Consolidation..............................50
Section 12.2 Successor Corporation to Be Substituted..................................51
ARTICLE XIII SATISFACTION AND DISCHARGE OF INDENTURE..........................................52
Section 13.1 Discharge of Indenture...................................................52
Section 13.2 Deposited Monies to Be Held in Trust by Trustee..........................52
Section 13.3 Paying Agent to Repay Monies Held........................................52
Section 13.4 Return of Unclaimed Monies...............................................53
Section 13.5 Reinstatement............................................................53
ARTICLE XIV IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS...................53
Section 14.1 Indenture and Notes Solely Corporate Obligations.........................53
ARTICLE XV CONVERSION OF NOTES................................................................54
Section 15.1 Conversion Privilege and Conversion Price................................54
Section 15.2 Exercise of Conversion Privilege.........................................54
Section 15.3 Fractions of Shares......................................................55
Section 15.4 Adjustment of Conversion Price...........................................55
Section 15.5 Notice of Adjustments of Conversion Price................................64
Section 15.6 Notice of Certain Corporate Action.......................................64
Section 15.7 Company to Provide Common Stock..........................................66
Section 15.8 Taxes on Conversions.....................................................66
Section 15.9 Company Covenants as to Common Stock.....................................66
Section 15.10 Cancellation of Converted Notes..........................................67
Section 15.11 Effect of Reclassification, Consolidation, Merger or Sale................67
Section 15.12 Responsibility of Trustee for Conversion Provisions......................68
ARTICLE XVI REPURCHASE UPON A FUNDAMENTAL CHANGE..............................................68
Section 16.1 Right to Require Repurchase..............................................68
Section 16.2 Notices; Method of Exercising Repurchase Right, Etc......................69
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Section 16.3 Merger, Consolidation, etc............................................71
ARTICLE XVII MISCELLANEOUS PROVISIONS......................................................72
Section 17.1 Provisions Binding on Company's Successors............................72
Section 17.2 Official Acts by Successor Corporation................................72
Section 17.3 Addresses for Notices, Etc............................................72
Section 17.4 Governing Law.........................................................73
Section 17.5 Evidence of Compliance with Conditions Precedent; Certificates
to Trustee ...........................................................73
Section 17.6 Legal Holidays........................................................73
Section 17.7 No Note Interest Created..............................................73
Section 17.8 Trust Indenture Act...................................................73
Section 17.9 Benefits of Indenture.................................................74
Section 17.10 Table of Contents, Headings, Etc......................................74
Section 17.11 Authenticating Agent..................................................74
Section 17.12 Execution in Counterparts.............................................75
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INDENTURE dated as of March 1, 1998 between HNC Software Inc., a
Delaware corporation (hereinafter sometimes called the "Company", as more fully
set forth in Section 1.1), and State Street Bank and Trust Company of
California, N.A., a national banking association organized under the laws of the
United States (hereinafter sometimes called the "Trustee", as more fully set
forth in Section 1.1).
W I T N E S S E T H:
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the issue of its __% Convertible Subordinated Notes due 2003
(hereinafter sometimes called the "Notes"), in an aggregate principal amount not
to exceed $100,000,000 and, to provide the terms and conditions upon which the
Notes are to be authenticated, issued and delivered, the Company has duly
authorized the execution and delivery of this Indenture; and
WHEREAS, all acts and things necessary to make the Notes, when executed
by the Company and authenticated and delivered by the Trustee or a duly
authorized authenticating agent, as in this Indenture provided, the valid,
binding and legal obligations of the Company, and to constitute these presents a
valid agreement according to its terms, have been done and performed, and the
execution of this Indenture and the issue hereunder of the Notes have in all
respects been duly authorized.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That in order to declare the terms and conditions upon which the Notes
are, and are to be, authenticated, issued and delivered, and in consideration of
the premises and of the purchase and acceptance of the Notes by the holders
thereof, the Company covenants and agrees with the Trustee for the equal and
proportionate benefit of the respective holders from time to time of the Notes
(except as otherwise provided below), as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. The terms defined in this Section 1.1 (except
as herein otherwise expressly provided or unless the context otherwise requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section 1.1. All other
terms used in this Indenture, which are defined in the Trust Indenture Act or
which are by reference therein defined in the Securities Act (except as herein
otherwise expressly provided or unless the context otherwise requires) shall
have the meanings assigned to such terms in said Trust Indenture Act and in said
Securities Act as in force at the date of the execution of this Indenture. The
words "herein," "hereof," "hereunder," and words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
Subdivision. The terms defined in this Indenture include the plural as well as
the singular.
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Affiliate: The term "Affiliate" of any specified Person means any other
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For the purposes of this
definition, "control," when used with respect to any specified Person means the
power to direct or cause the direction of the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Applicable Price: The term "Applicable Price" means (i) in the event of
a Fundamental Change in which the holders of Common Stock receive only cash, the
amount of cash received by the holders of one share of Common Stock and (ii) in
the event of any other Fundamental Change, the arithmetic average of the Closing
Price for the Common Stock during the ten Trading Days prior to the record date
for the determination of the holders of Common Stock entitled to receive cash,
securities, property or other assets in connection with such Fundamental Change,
or, if no such record date exists, the date upon which the holders of the Common
Stock shall have the right to receive such cash, securities, property or other
assets in connection with the Fundamental Change.
Board of Directors: The term "Board of Directors" means the Board of
Directors of the Company or a committee of such Board duly authorized to act for
it hereunder.
Board Resolution: The term "Board Resolution" means a copy of a
resolution certified by the Secretary or an Assistant Secretary of the Company
to have been duly adopted by the Board of Directors, or duly authorized
committee thereof (to the extent permitted by applicable law), and to be in full
force and effect on the date of such certification.
Business Day: The term "Business Day" means each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which the banking
institutions in The City of New York or San Diego, California or the city in
which the Corporate Trust Office is located are authorized or obligated by law
or executive order to close or be closed.
Commission: The term "Commission" means the Securities and Exchange
Commission.
Common Stock: The term "Common Stock" means any stock of any class of
the Company which has no preference in respect of dividends or of amounts
payable in the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and which is not subject to redemption by the Company.
Subject to the provisions of Section 15.11, however, shares issuable on
conversion of Notes shall include only shares of the class designated as common
stock of the Company at the date of this Indenture or shares of any class or
classes resulting from any reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which are not subject to redemption by the Company; provided
that if at any time there shall be more than one such resulting class,
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the shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from all
such reclassifications bears to the total number of shares of all such classes
resulting from all such reclassifications.
Company: The term "Company" means HNC Software Inc., a Delaware
corporation, and subject to the provisions of Article XII, shall include its
successors and assigns.
Corporate Trust Office: The term "Corporate Trust Office," or other
similar term, means the office of the Trustee at which at any particular time
its corporate trust business shall be principally administered, which office is,
at the date as of which this Indenture is dated, located at 000 Xxxx 0xx Xxxxxx,
00xx Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000, Attention: Corporate Trust Division
(HNC Software Inc. __% Convertible Subordinated Notes due 2003).
Credit Agreement: The term "Credit Agreement" means that certain Credit
Agreement, dated as of July 11, 1997, between the Company and Xxxxx Fargo Bank
National Association, as amended through the date hereof, as further amended and
restated, supplemented or otherwise modified from time to time.
default: The term "default" means any event that is, or after notice or
passage of time, or both, would be, an Event of Default.
Designated Senior Indebtedness: The term "Designated Senior
Indebtedness" means the Credit Agreement and the Company's obligations under any
other particular Senior Indebtedness of the Company in which the instrument
creating or evidencing the same or the assumption or guarantee thereof (or
related agreements or documents to which the Company is a party) expressly
provides that such Senior Indebtedness shall be "Designated Senior Indebtedness"
for purposes of this Indenture (provided that such instrument, agreement or
other document may place limitations and conditions on the right of such Senior
Indebtedness to exercise the rights of Designated Senior Indebtedness).
Exchange Act: The term "Exchange Act" means the Securities Exchange Act
of 1934, as amended, and the rules and regulations promulgated thereunder.
Event of Default: The term "Event of Default" means any event specified
in Section 7.1(a), (b), (c), (d) or (e), continued for the period of time, if
any, and after the giving of notice, if any, therein designated.
Fundamental Change: The term "Fundamental Change" means the occurrence
of any transaction or event in connection with which all or substantially all of
the Common Stock shall be exchanged for, converted into, acquired for or
constitute solely the right to receive, consideration (whether by means of an
exchange offer, liquidation, tender offer, consolidation, merger, combination,
reclassification, recapitalization or otherwise) which is not all or
substantially all common stock or shares which are (or, upon consummation of or
immediately
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following such transaction or event, will be) listed on a United States national
securities exchange or approved for quotation on the Nasdaq National Market or
any similar United States system of automated dissemination of quotations of
securities prices.
Holder or holder: The terms "Holder" or "holder" as applied to any Note,
or other similar terms (but excluding the term "beneficial holder"), means any
Person in whose name at the time a particular Note is registered on the Note
register.
Indebtedness: The term "Indebtedness" means, with respect to any Person,
and without duplication, (a) all indebtedness, obligations and other liabilities
(contingent or otherwise) of the Person for borrowed money (including
obligations of the Person in respect of overdrafts, foreign exchange contracts,
currency exchange agreements, interest rate protection agreements, and any loans
or advances from banks, whether or not evidenced by notes or similar
instruments) or evidenced by bonds, debentures, notes or similar instruments
(whether or not the recourse of the lender is to the whole of the assets of the
Person or to only a portion thereof), (b) all reimbursement obligations and
other liabilities (contingent or otherwise) of the Person with respect to
letters of credit, bank guarantees or bankers' acceptances, (c) all obligations
and liabilities (contingent or otherwise) in respect of leases of the Person
required, in conformity with generally accepted accounting principles, to be
accounted for as capitalized lease obligations on the balance sheet of the
Person and all obligations and other liabilities (contingent or otherwise) under
any lease or related document (including a purchase agreement) in connection
with the lease of real property or improvements thereon which provides that such
Person is contractually obligated to purchase or cause a third party to purchase
the leased property and thereby guarantee a minimum residual value of the leased
property to the lessor and the obligations of such Person under such lease or
related document to purchase or to cause a third party to purchase such leased
property, (d) all obligations of the Person (contingent or otherwise) with
respect to an interest rate or other swap, cap or collar agreement or other
similar instrument or agreement or foreign currency hedge, exchange, purchase or
similar instrument or agreement, (e) all direct or indirect guaranties or
similar agreements by the Person in respect of, and obligations or liabilities
(contingent or otherwise) of the Person to purchase or otherwise acquire or
otherwise assure a creditor against loss in respect of, indebtedness,
obligations or liabilities of another Person of the kind described in clauses
(a) through (d), (f) any indebtedness or other obligations described in clauses
(a) through (d) secured by any mortgage, pledge, lien or other encumbrance
existing on property which is owned or held by the Person, regardless of whether
the indebtedness or other obligation secured thereby shall have been assumed by
the Person and (g) any and all deferrals, renewals, extensions, refinancings and
refundings of, or amendments, modifications or supplements to, any indebtedness,
obligation or liability of the kind described in clauses (a) through (f).
Notwithstanding the foregoing, the term "Indebtedness" shall not include any
account payable or other accrued current liability or obligation incurred in the
ordinary course of business in connection with the obtaining of materials or
services.
Indenture: The term "Indenture" means this instrument as originally
executed or, if amended or supplemented as herein provided, as so amended or
supplemented.
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Note or Notes: The terms "Note" or "Notes" means any Note or Notes, as
the case may be, authenticated and delivered under this Indenture.
Officers' Certificate: The term "Officers' Certificate", when used with
respect to the Company, means a certificate signed by the Chief Executive
Officer, President, or any Vice President (whether or not designated by a number
or numbers or word added before or after the title "Vice President") and by the
Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of
the Company, which is delivered to the Trustee. Each such certificate shall
include the statements provided for in Section 17.5 if and to the extent
required by the provisions of such Section.
Opinion of Counsel: The term "Opinion of Counsel" means an opinion in
writing signed by legal counsel, who may be an employee of or counsel to the
Company, or other counsel acceptable to the Trustee, which is delivered to the
Trustee. Each such opinion shall include the statements provided for in Section
17.5 if and to the extent required by the provisions of such Section.
outstanding: The term "outstanding," when used with reference to Notes,
means, subject to the provisions of Section 9.4, as of any particular time, all
Notes authenticated and delivered by the Trustee under this Indenture, except
(a) Notes theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(b) Notes, or portions thereof, for the payment or redemption of
which monies in the necessary amount shall have been deposited in trust
with the Trustee or with any paying agent (other than the Company) or
shall have been set aside and segregated in trust by the Company (if the
Company shall act as its own paying agent); provided that if such Notes
are to be redeemed prior to the maturity thereof, notice of such
redemption shall have been given as provided in Section 3.2 or provision
satisfactory to the Trustee shall have been made for giving such notice;
provided further that if any Notes are not redeemed on a redemption
date, then such Notes shall be deemed outstanding until all principal of
and premium, if any, and accrued interest on such Notes has been paid in
full in accordance with the terms of this Indenture;
(c) Notes which have been paid pursuant to Section 3.6 or in lieu
of which, or in substitution for which, other Notes shall have been
authenticated and delivered pursuant to the terms of Section 2.6 unless
proof satisfactory to the Trustee is presented that any such Notes are
held by bona fide holders in due course; and
(d) Notes converted into Common Stock pursuant to Article XV and
Notes deemed not outstanding pursuant to Section 3.2.
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Person: The term "Person" means a corporation, an association, a
partnership, a limited liability company, an individual, a joint venture, a
joint stock company, a trust, an unincorporated organization or a government or
an agency or a political subdivision thereof.
Predecessor Note: The term "Predecessor Note" of any particular Note
means every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purposes of this definition, any
Note authenticated and delivered under Section 2.6 in lieu of a lost, destroyed
or stolen Note shall be deemed to evidence the same debt as the lost, destroyed
or stolen Note that it replaces.
Record Date: The term "Record Date" means any Regular Record Date or
Special Record Date.
Redemption Date: The term "Redemption Date," when used with respect to
any Note to be redeemed in whole or in part, means the date fixed for such
redemption by or pursuant to this Indenture.
Redemption Price: The term "Redemption Price", when used with respect to
any Note to be redeemed, means the price at which it is to be redeemed pursuant
to this Indenture.
Reference Market Price: The term "Reference Market Price" will initially
mean $_____ and in the event of any adjustment to the Conversion Price pursuant
to Section 15.4, the Reference Market Price shall also be adjusted so that the
ratio of the Reference Market Price to the Conversion Price after giving effect
to any such adjustment shall always be the same as the ratio of $_____ to the
initial Conversion Price specified in Section 15.1 (without regard to any
adjustment thereto).
Regular Record Date: The term "Regular Record Date" for interest payable
in respect of any Security on any interest payment date means the February 15 or
August 15 (whether or not a Business Day), as the case may be, next preceding
such interest payment date.
Representative. The term "Representative" means the (a) indenture
trustee or other trustee, agent or representative for any Senior Indebtedness or
(b) with respect to any Senior Indebtedness that does not have any such trustee,
agent or other representative, (i) in the case of such Senior Indebtedness
issued pursuant to an agreement providing for voting arrangements as among the
holders or owners of such Senior Indebtedness, any holder or owner of such
Senior Indebtedness acting with the consent of the required Persons necessary to
bind such holders or owners of such Senior Indebtedness and (ii) in the case of
all other such Senior Indebtedness, the holder or owner of such Senior
Indebtedness.
Responsible Officer: The term "Responsible Officer", when used with
respect to the Trustee, means an officer of the Trustee assigned to the
Corporate Trust Office of the Trustee,
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and any other officer of the Trustee to whom such matter is referred to because
of his knowledge of and familiarity with the particular subject.
Securities Act: The term "Securities Act" means the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder.
Senior Indebtedness: The term "Senior Indebtedness" means the principal
of, premium, if any, interest (including all interest accruing subsequent to the
commencement of any bankruptcy or similar proceeding, whether or not a claim for
post-petition interest is allowable as a claim in any such proceeding) and rent
payable on or in connection with, and all fees, costs, expenses and other
amounts accrued or due on or in connection with, Indebtedness of the Company,
whether outstanding on the date of this Indenture or thereafter created,
incurred, assumed, guaranteed or in effect guaranteed by the Company (including
all deferrals, renewals, extensions or refundings of, or amendments,
modifications or supplements to, the foregoing), unless in the case of any
particular Indebtedness the instrument creating or evidencing the same or the
assumption or guarantee thereof expressly provides that such Indebtedness shall
not be senior in right of payment to the Notes or expressly provides that such
Indebtedness is "pari passu" or "junior" to the Notes. Notwithstanding the
foregoing, Senior Indebtedness shall not include (i) any Indebtedness of the
Company to any Subsidiary of the Company or (ii) the Notes.
Special Record Date: The term "Special Record Date" for the payment of
any Defaulted Interest means a date fixed by the Trustee pursuant to Section
2.3.
Subsidiary: The term "Subsidiary" means a corporation more than 50% of
the outstanding voting stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries. For the purposes of this definition, "voting stock" means
stock which ordinarily has voting power for the election of directors, whether
at all times or only so long as no senior class of stock has such voting power
by reason of any contingency.
Trust Indenture Act: The term "Trust Indenture Act" means the Trust
Indenture Act of 1939, as amended, as it was in force at the date of execution
of this Indenture, except as provided in Sections 11.3 and 15.6; provided,
however, that in the event the Trust Indenture Act of 1939 is amended after the
date hereof, the term "Trust Indenture Act" shall mean, to the extent required
by such amendment, the Trust Indenture Act of 1939 as so amended.
Trustee: The term "Trustee" means State Street Bank and Trust Company of
California, N.A., and its successors and any corporation resulting from or
surviving any consolidation or merger to which it or its successors may be a
party and any successor trustee at the time serving as successor trustee
hereunder.
In addition to the foregoing defined terms (except as herein otherwise
expressly provided or unless the context otherwise requires), the following
terms shall have the respective meanings
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specified in the following Sections and any other terms defined herein shall
have the meanings assigned thereto:
Term Section
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Closing Price 15.4(8)
Company Notice 16.2
Conversion Price 15.1
Conversion Shares 15.4(4)
Current Market Price 15.4
Defaulted Interest 2.3
Distribution Record Date 15.4(8)
"ex" date 15.5(h)
Expiration Time 15.5(f)
fair market value 15.4(8)
junior securities 4.8
non-electing share 15.6
Note register 2.5
Note registrar 2.5
Offer Expiration Time 15.5(g)
Payment Blockage Notice 4.2(ii)
Purchased Common Shares 15.5(g)
Purchased Shares 15.5(f)
Removal Notice 8.10(b)
Repurchase Date 16.1
Repurchase Price 16.1
Termination of Trading 16.3
Trading Day 15.4(8)
Trigger Event 15.2
ARTICLE II
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION
AND EXCHANGE OF NOTES
Section 2.1 Designation, Amount and Issue of Notes. The Notes shall be
designated as "__% Convertible Subordinated Notes due 2003". Notes not to exceed
the aggregate principal amount of $90,000,000 (or $100,000,000 if the
over-allotment option set forth in Section 2(b) of the Underwriting Agreement
for the Notes dated March __, 1998 (as amended from time to time by the parties
thereto) by and between the Company and the several underwriters named therein
is exercised in full) (except pursuant to Sections 2.5, 2.6, 3.7, 15.2 and 16.2)
upon the execution of this Indenture, or from time to time thereafter, may be
executed by the Company and delivered
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to the Trustee for authentication, and the Trustee shall thereupon authenticate
and deliver said Notes upon the written order of the Company, signed by its (a)
Chief Executive Officer, President or any Vice President (whether or not
designated by a number or numbers or word or words added before or after the
title "Vice President") and (b) Treasurer or Assistant Treasurer or its
Secretary or any Assistant Secretary, without any further action by the Company
hereunder.
Section 2.2 Form of Notes. The Notes and the Trustee's certificate of
authentication to be borne by such Notes shall be substantially in the form set
forth in Exhibit A, which is incorporated in and made a part of this Indenture.
Any of the Notes may have such letters, numbers or other marks of
identification and such notations, legends and endorsements as the officers
executing the same may approve (execution thereof to be conclusive evidence of
such approval) and as are not inconsistent with the provisions of this
Indenture, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
securities exchange or automated quotation system on which the Notes may be
listed or designated for issuance, or to conform to usage.
The terms and provisions contained in the form of Note attached as
Exhibit A hereto shall constitute, and are hereby expressly made, a part of this
Indenture and to the extent applicable, the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
Section 2.3 Date and Denomination of Notes; Payments of Interest. The
Notes shall be issuable in registered form without coupons in denominations of
$1,000 principal amount and integral multiples thereof. Every Note shall be
dated the date of its authentication, shall bear interest from the applicable
date and accrued interest shall be payable semiannually on each March 1 and
September 1, commencing September 1, 1998 as specified on the face of the form
of Note, attached as Exhibit A hereto.
The Person in whose name any Note (or its Predecessor Note) is
registered at the close of business on any Regular Record Date with respect to
any interest payment date (including any Note that is converted during the
period from the close of business on any Regular Record Date to the close of
business on the Business Day prior to the next succeeding interest payment date)
shall be entitled to receive the interest payable on such interest payment date
notwithstanding the cancellation of such Note upon any transfer, exchange or
conversion subsequent to the Regular Record Date and prior to such interest
payment date; provided that any Note surrendered for conversion during the
period from the close of business on any Regular Record Date to the close of
business on the Business Day prior to the next succeeding interest payment date,
to the extent provided in Section 15.2, shall be accompanied by a payment equal
to the interest otherwise payable on such next succeeding interest payment date;
provided further that in the event of any redemption or repurchase of any Note
after a Regular Record Date and prior to the next succeeding interest payment
date, interest shall not be paid to the Person in whose name the Note
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is registered on the close of business on such Regular Record Date, but instead
shall be payable to the holder of such Note surrendering such Note for
redemption or repurchase, as the case may be, as required by Section 3.7 hereof
and Article XVI hereof, respectively. Interest may, at the option of the
Company, be paid by check mailed to the address of such Person on the registry
kept for such purposes; provided that, with respect to any holder of Notes with
an aggregate principal amount equal to or in excess of $1,000,000, at the
request of such holder in writing to the Company, interest on such holder's
Notes shall be paid by wire transfer in immediately available funds in
accordance with the wire transfer instruction supplied by such holder to the
Trustee and paying agent (if different from Trustee).
Interest on the Notes shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
Any interest on any Note which is payable, but is not punctually paid or
duly provided for, on any said March 1 or September 1 (herein called "Defaulted
Interest") shall forthwith cease to be payable to the Holder on the relevant
Regular Record Date by virtue of his having been such Holder; and such Defaulted
Interest shall be paid by the Company, at its election in each case, as provided
in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Notes (or their respective
Predecessor Notes) are registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest, which shall be
fixed in the following manner. The Company shall notify the Trustee in
writing of the amount of Defaulted Interest to be paid on each Note and
the date of the payment (which shall be not less than twenty-five (25)
days after the receipt by the Trustee of such notice, unless the Trustee
shall consent to an earlier date), and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate
amount to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the
date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted Interest
as in this clause provided. Thereupon the Trustee shall fix a Special
Record Date for the payment of such Defaulted Interest which shall be
not more than fifteen (15) days and not less than ten (10) days prior to
the date of the proposed payment and not less than ten (10) days (or
such shorter period to which the Trustee consents) after the receipt by
the Trustee of the notice of the proposed payment. The Trustee shall
promptly notify the Company of such Special Record Date and, in the name
and at the expense of the Company, shall cause notice of the proposed
payment of such Defaulted Interest and the Special Record Date therefor
to be mailed, first-class postage prepaid, to each Holder at his address
as it appears in the Note register, not less than ten (10) days prior to
such Special Record Date. Notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose
names the Notes (or their
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respective Predecessor Notes) were registered at the close of business
on such Special Record Date and shall no longer be payable pursuant to
the following clause (2).
(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange or automated quotation system on which the Notes may
be listed or designated for issuance, and upon such notice as may be
required by such exchange or automated quotation system, if, after
notice given by the Company to the Trustee of the proposed payment
pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
Section 2.4 Execution of Notes. The Notes shall be signed in the name
and on behalf of the Company by the signature of its Chief Executive Officer,
its President, or any of its Vice Presidents (whether or not designated by a
number or numbers or word or words added before or after the title "Vice
President") and attested by the signature of its Treasurer or any of its
Assistant Treasurers or its Secretary or any of its Assistant Secretaries. The
signature of any of these officers on the Notes may be manual or facsimile and
may be printed, engraved or otherwise reproduced on the Notes. Only such Notes
as shall bear thereon a certificate of authentication substantially in the form
set forth on the form of Note attached as Exhibit A hereto, manually executed by
the Trustee (or an authenticating agent appointed by the Trustee as provided by
Section 17.11), shall be entitled to the benefits of this Indenture or be valid
or obligatory for any purpose. Such certificate by the Trustee (or such an
authenticating agent) upon any Note executed by the Company shall be conclusive
evidence that the Note so authenticated has been duly authenticated and
delivered hereunder and that the holder is entitled to the benefits of this
Indenture.
In case any officer of the Company who shall have signed any of the
Notes shall cease to be such officer before the Notes so signed shall have been
authenticated and delivered by the Trustee, or disposed of by the Company, such
Notes nevertheless may be authenticated and delivered or disposed of as though
the Person who signed such Notes had not ceased to be such officer of the
Company; and any Note may be signed on behalf of the Company by such Persons as,
at the actual date of the execution of such Note, shall be the proper officers
of the Company, although at the date of the execution of this Indenture any such
Person was not such an officer.
Section 2.5 Exchange and Registration of Transfer of Notes. The Company
shall cause to be kept at the Corporate Trust Office of the Trustee a register
(the register maintained in such office and in any other office or agency of the
Company designated pursuant to Section 5.2 being herein sometimes collectively
referred to as the "Note register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration
of Notes and of transfers of Notes. Such Note register shall be in written form
or in any form capable of being converted into written form within a reasonable
period of time. The Trustee is hereby appointed "Note registrar" for the purpose
of registering Notes and transfers of Notes as
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herein provided. The Company may appoint one or more co-registrars in accordance
with Section 5.2.
Upon surrender for registration of transfer of any Note to the Note
registrar or any co-registrar, and satisfaction of the requirements for such
transfer set forth in this Section 2.5, the Company shall execute, and the
Trustee shall authenticate and deliver, in the name of the designated transferee
or transferees, one or more new Notes of any authorized denominations and of a
like aggregate principal amount.
Notes may be exchanged for other Notes of any authorized denominations
and of a like aggregate principal amount, upon surrender of the Notes to be
exchanged at any such office or agency. Whenever any Notes are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Notes which the Holder making the exchange is entitled to receive,
bearing registration numbers not contemporaneously outstanding.
All Notes presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company, the Trustee, the Note registrar
or any co-registrar) be duly endorsed, or be accompanied by a written instrument
or instruments of transfer in form satisfactory to the Company and duly executed
by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be charged to the Holder for any exchange or
registration of transfer of Notes, but the Company may require payment of a sum
sufficient to cover any tax, assessments or other governmental charges that may
be imposed in connection therewith.
None of the Company, the Trustee, the Note registrar or any co-registrar
shall be required to exchange or register a transfer of (a) any Notes for a
period of fifteen (15) days next preceding any selection of Notes to be redeemed
or (b) any Notes called for redemption or, if a portion of any Note is selected
or called for redemption, such portion thereof selected or called for redemption
or (c) any Notes surrendered for conversion or, if a portion of any Note is
surrendered for conversion, such portion thereof surrendered for conversion or
(d) any Notes surrendered for repurchase (and not withdrawn) pursuant to Article
XVI or, if a portion of any Note is surrendered for repurchase pursuant to
Article XVI, such portion thereof surrendered for repurchase (and not withdrawn)
pursuant to Article XVI.
All Notes issued upon any transfer or exchange of Notes in accordance
with this Indenture shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture as the
Notes surrendered upon such registration of transfer or exchange.
Section 2.6 Mutilated, Destroyed, Lost or Stolen Notes. In case any Note
shall become mutilated or be destroyed, lost or stolen, the Company in its
discretion may execute, and upon its request the Trustee or an authenticating
agent appointed by the Trustee shall authenticate and deliver, a new Note,
bearing a number not contemporaneously outstanding, in exchange and
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substitution for the mutilated Note, or in lieu of and in substitution for the
Note so destroyed, lost or stolen. In every case the applicant for a substituted
Note shall furnish to the Company, to the Trustee and, if applicable, to such
authenticating agent such security or indemnity as may be required by them to
save each of them harmless for any loss, liability, cost or expense caused by or
connected with such substitution, and, in every case of destruction, loss or
theft, the applicant shall also furnish to the Company, to the Trustee and, if
applicable, to such authenticating agent evidence to their satisfaction of the
destruction, loss or theft of such Note and of the ownership thereof.
The Trustee or such authenticating agent may authenticate any such
substituted Note and deliver the same upon the receipt of such security or
indemnity as the Trustee, the Company and, if applicable, such authenticating
agent may require. Upon the issuance of any substituted Note, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses connected
therewith. In case any Note which has matured or is about to mature or has been
called for redemption or submitted for repurchase (and not withdrawn) or is
about to be converted into Common Stock shall become mutilated or be destroyed,
lost or stolen, the Company may, instead of issuing a substitute Note, pay or
authorize the payment of or convert or authorize the conversion of the same
(without surrender thereof except in the case of a mutilated Note), as the case
may be, if the applicant for such payment or conversion shall furnish to the
Company, to the Trustee and, if applicable, to such authenticating agent such
security or indemnity as may be required by them to save each of them harmless
for any loss, liability, cost or expense caused by or connected with such
substitution, and, in case of destruction, loss or theft, evidence satisfactory
to the Company, the Trustee and, if applicable, any paying agent or conversion
agent of the destruction, loss or theft of such Note and of the ownership
thereof.
Every substitute Note issued pursuant to the provisions of this Section
2.6 by virtue of the fact that any Note is destroyed, lost or stolen shall
constitute an additional contractual obligation of the Company, whether or not
the destroyed, lost or stolen Note shall be found at any time, and shall be
entitled to all the benefits of (but shall be subject to all the limitations set
forth in) this Indenture equally and proportionately with any and all other
Notes duly issued hereunder. To the extent permitted by law, all Notes shall be
held and owned upon the express condition that the foregoing provisions are
exclusive with respect to the replacement or payment or conversion of mutilated,
destroyed, lost or stolen Notes and shall preclude any and all other rights or
remedies notwithstanding any law or statute existing or hereafter enacted to the
contrary with respect to the replacement or payment or conversion of negotiable
instruments or other securities without their surrender.
Section 2.7 Temporary Notes. Pending the preparation of definitive
Notes, the Company may execute and the Trustee or an authenticating agent
appointed by the Trustee shall, upon written request of the Company,
authenticate and deliver temporary Notes (printed, typewritten or lithographed).
Temporary Notes shall be issuable in any authorized denomination, and
substantially in the form of the definitive Notes but with such omissions,
insertions and
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variations as may be appropriate for temporary Notes, all as may be determined
by the Company. Every such temporary Note shall be executed by the Company and
authenticated by the Trustee or such authenticating agent upon the same
conditions and in substantially the same manner, and with the same effect, as
the definitive Notes. Without unreasonable delay the Company will execute and
deliver to the Trustee or such authenticating agent definitive Notes and
thereupon any or all temporary Notes may be surrendered in exchange therefor, at
each office or agency maintained by the Company pursuant to Section 5.2 and the
Trustee or such authenticating agent shall authenticate and deliver in exchange
for such temporary Notes an equal aggregate principal amount of definitive
Notes. Such exchange shall be made by the Company at its own expense and without
any charge therefor. Until so exchanged, the temporary Notes shall in all
respects be entitled to the same benefits and subject to the same limitations
under this Indenture as definitive Notes authenticated and delivered hereunder.
Section 2.8 Cancellation of Notes Paid, Etc. All Notes surrendered for
the purpose of payment, redemption, repurchase, conversion, exchange or
registration of transfer, shall, if surrendered to the Company or any paying
agent or any Note registrar or any conversion agent, be surrendered to the
Trustee and promptly canceled by it, or, if surrendered to the Trustee, shall be
promptly canceled by it, and no Notes shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Indenture. Upon written
instructions of the Company, the Trustee shall destroy canceled Notes and, after
such destruction, shall deliver a certificate of such destruction to the
Company. If the Company shall acquire any of the Notes, such acquisition shall
not operate as a redemption or satisfaction of the indebtedness represented by
such Notes unless and until the same are delivered to the Trustee for
cancellation.
ARTICLE III
REDEMPTION OF NOTES
Section 3.1 Right of Redemption. The Notes may be redeemed in accordance
with the provisions of the form of Note attached as Exhibit A hereto.
Section 3.2 Applicability of Article. Redemption of Notes at the
election of the Company or otherwise, as permitted or required by any provision
of the Notes or this Indenture, shall be made in accordance with such provision
and this Article III.
Section 3.3 Election to Redeem; Notice to Trustee. The election of the
Company to redeem any Notes shall be evidenced by a Board Resolution. In case of
any redemption at the election of the Company of any of the Notes, the Company
shall, at least 45 days prior to the Redemption Date fixed by the Company
(unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee in writing of such Redemption Date.
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Section 3.4 Selection by Trustee of Notes to Be Redeemed. If less than
all the Notes are to be redeemed, the particular Notes to be redeemed shall be
selected by the Trustee within seven Business Days after it receives the notice
described in 3.3, from the outstanding Notes not previously called for
redemption, by lot or, in the Trustee's sole discretion, on a pro rata basis.
If any Note selected for partial redemption is converted in part before
termination of the conversion right with respect to the portion of the Note so
selected, the converted portion of such Note shall be deemed (so far as may be)
to be the portion selected for redemption. Notes which have been converted
during a selection of Notes to be redeemed may be treated by the Trustee as
Outstanding for the purpose of such selection.
The Trustee shall promptly notify the Company and each Note Registrar in
writing of the securities selected for redemption and, in the case of any Notes
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Notes shall relate, in
the case of any Notes redeemed or to be redeemed only in part, to the portion of
the principal amount of such Notes which has been or is to be redeemed.
Section 3.5 Notice of Redemption. Notice of redemption shall be mailed
to the Holders of Notes to be redeemed not less than 20 nor more than 60 days
prior to the Redemption Date, and such notice shall be irrevocable.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all outstanding Notes are to be redeemed, the
aggregate principal amount of Notes to be redeemed and the aggregate
principal amount of Notes which will be outstanding after such partial
redemption,
(4) that on the Redemption Date the Redemption Price, and accrued
interest, if any, to the Redemption Date will become due and payable
upon each such Note to be redeemed, and that interest thereon shall
cease to accrue on and after said date,
(5) the Conversion Price then in effect, the date on which the
right to convert the Notes to be redeemed will terminate and the places
where such Notes may be surrendered for conversion,
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(6) the place or places where such Notes are to be surrendered
for payment of the Redemption Price and accrued interest, if any, and
(7) the CUSIP number for the Notes.
Neither failure to receive any such notice so mailed nor any defect
therein shall affect the validity of the proceedings for the redemption of such
Notes or the cessation of the accrual of interest.
In case of a partial redemption, the notice shall specify the serial and
CUSIP numbers (if any) and the portions thereof called for redemption and that
transfers and exchanges may occur on or prior to the Redemption Date.
Notice of redemption of Notes to be redeemed at the election of the
Company shall be given by the Company or, at the Company's written request, by
the Trustee in the name of, and at the expense of, the Company. Notice of
redemption of Notes to be redeemed at the election of the Company received by
the Trustee shall be given by the Trustee to each paying agent in the name of
and at the expense of the Company.
Section 3.6 Deposit of Redemption Price. By 10:00 a.m. (New York time)
on any Redemption Date of the Notes, the Company shall deposit with the Trustee
or with the paying agent so directed by the Trustee (or, if the Company is
acting as its own paying agent, segregate and hold in trust as provided in
Section 8.5) an amount of money (which shall be in immediately available funds
on such Redemption Date) sufficient to pay the Redemption Price of, and accrued
interest to (but excluding) the Redemption Date on, all the Notes which are to
be redeemed on that date other than any Notes called for redemption on that date
which have been converted prior to the date of such deposit.
If any Note called for redemption is converted, any money deposited with
the Trustee or with a paying agent or so segregated and held in trust for the
redemption of such Note shall (subject to any right of the Holder of such Note,
if a Note, or any Predecessor Note to receive interest as provided in the last
paragraph of Section 2.3) be paid to the Company upon request as soon as
administratively practicable after the Trustee receives such request or, if then
held by the Company, shall be discharged from such trust.
Section 3.7 Notes Payable on Redemption Date. Notice of redemption
having been given as aforesaid, the Notes so to be redeemed shall, on the
Redemption Date, become due and payable at the Redemption Price therein
specified plus accrued interest to (but excluding) the Redemption Date and from
and after such date (unless the Company shall default in the payment of the
Redemption Price, including accrued interest to (but excluding) the Redemption
Date) such Notes shall cease to bear interest. Upon surrender of any Note for
redemption in accordance with said notice, such Note shall be paid by the
Company at the Redemption Price together with accrued and unpaid interest to
(but excluding) the Redemption Date; provided,
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however, that any semi-annual payment of interest becoming due on the Redemption
Date shall be payable to the holders of record on the Regular Record Date of the
Notes being redeemed.
If any Note called for redemption shall not be so paid upon surrender
thereof for redemption, the principal amount of, premium, if any, and, to the
extent permitted by applicable law, accrued interest on such Note shall, until
paid, bear interest from the Redemption Date at a rate of _____% per annum and
such Note shall remain convertible into Common Stock until the principal of such
Note (or portion thereof, as the case may be) shall have been paid or duly
provided for.
Section 3.8 Notes Redeemed in Part. Any Note which is to be redeemed
only in part shall be surrendered at an office or agency of the Company
designated for that purpose pursuant to Section 5.2 (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and make available for delivery to
the Holder of such Note without service charge, a new Note or Notes, of any
authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal of
the Note so surrendered.
Section 3.9 Conversion Arrangement on Call for Redemption. In connection
with any redemption of Notes, the Company may arrange for the purchase and
conversion of any Notes by an agreement with one or more investment bankers or
other purchasers (the "Purchasers") to purchase such securities by paying to the
Trustee in trust for the Holders, on or before the Redemption Date, an amount
not less than the applicable Redemption Price, together with interest accrued to
(but excluding) the Redemption Date, of such Notes. Notwithstanding anything to
the contrary contained in this Article III, the obligation of the Company to pay
the Redemption Price, together with interest accrued to (but excluding) the
Redemption Date, shall be deemed to be satisfied and discharged to the extent
such amount is so paid by such Purchasers. If such an agreement is entered into
(a copy of which shall be filed with the Trustee prior to the close of business
on the Business Day immediately prior to the Redemption Date), any Notes called
for redemption that are not duly surrendered for conversion by the Holders
thereof may, at the option of the Company, be deemed, to the fullest extent
permitted by law, and consistent with any agreement or agreements with such
Purchasers, to be acquired by such Purchasers from such Holders and
(notwithstanding anything to the contrary contained in Article XV) surrendered
by such Purchasers for conversion, all as of immediately prior to the close of
business on the Redemption Date (and the right to convert any such Notes shall
be extended though such time), subject to payment of the above amount as
aforesaid. At the direction of the Company, the Trustee shall hold and dispose
of any such amount paid to it to the Holders in the same manner as it would
monies deposited with it by the Company for the redemption of Notes. Without the
Trustee's prior written consent, no arrangement between the Company and such
Purchasers for the purchase and conversion of any Notes shall increase or
otherwise affect any of the powers, duties, responsibilities or obligations of
the Trustee as set
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forth in this Indenture, and the Company agrees to indemnify the Trustee from,
and hold it harmless against, any loss, liability or expense arising out of or
in connection with any such arrangement for the purchase and conversion of any
Notes between the Company and such Purchasers, including the costs and expenses,
including reasonable legal fees, incurred by the Trustee in the defense of any
claim or liability arising out of or in connection with the exercise or
performance of any of its powers, duties, responsibilities or obligations under
this Indenture.
ARTICLE IV
SUBORDINATION OF NOTES
Section 4.1 Agreement of Subordination. The Company covenants and
agrees, and each Holder of Notes issued hereunder by his acceptance thereof
likewise covenants and agrees, that all Notes shall be issued subject to the
provisions of this Article IV; and each Person holding any Note, whether upon
original issue or upon transfer, assignment or exchange thereof, accepts and
agrees to be bound by such provisions.
The payment of the principal of, premium, if any, and interest on all
Notes (including, but not limited to, the Redemption Price with respect to the
Notes called for redemption in accordance with Article IV, or the Repurchase
Price with respect to Notes submitted for repurchase in accordance with Article
XVI, as the case may be, as provided in this Indenture) issued hereunder shall,
to the extent and in the manner hereinafter set forth, be subordinated and
subject in right of payment to the prior payment in full in cash or other
payment satisfactory to the holders of Senior Indebtedness of all Senior
Indebtedness of the Company, whether outstanding at the date of this Indenture
or thereafter incurred.
No provision of this Article IV shall prevent the occurrence of any
default or Event of Default hereunder.
Section 4.2 Payments to Holders. No payment shall be made with respect
to the principal of, or premium, if any, or interest on the Notes by the Company
(including, but not limited to, the Redemption Price with respect to the Notes
to be called for redemption in accordance with Article III or the Repurchase
Price with respect to Notes submitted for repurchase in accordance with Article
XVI, as the case may be, as provided in this Indenture), except payments and
distributions made by the Trustee as permitted by the first or second paragraph
of Section 14.5, if:
(i) a default in the payment of principal, premium, interest,
rent or other obligations due on any Senior Indebtedness of the Company
has occurred and is continuing (or, in the case of Senior Indebtedness
of the Company for which there is a period of grace, in the event of
such a default that continues beyond the period of grace, if any,
specified in the instrument or lease evidencing such Senior Indebtedness
of the
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Company), unless and until such default shall have been cured or waived
or shall have ceased to exist; or
(ii) a default (other than a payment default) on Designated
Senior Indebtedness occurs and is continuing that then permits holders
of such Designated Senior Indebtedness to accelerate its maturity and
the Trustee receives a notice of the default (a "Payment Blockage
Notice") from a Representative of Designated Senior Indebtedness or a
holder of Designated Senior Indebtedness or the Company.
If the Trustee receives any Payment Blockage Notice pursuant to clause
(ii) above, no subsequent Payment Blockage Notice shall be effective for
purposes of this Section unless and until at least 365 days shall have elapsed
since the initial effectiveness of the immediately prior Payment Blockage
Notice. No nonpayment default that existed or was continuing on the date of
delivery of any Payment Blockage Notice to the Trustee (unless such default was
waived, cured or otherwise ceased to exist and thereafter subsequently
reoccurred) shall be, or be made, the basis for a subsequent Payment Blockage
Notice.
The Company may and shall resume payments on and distributions in
respect of the Notes upon the earlier of:
(1) in the case of a payment default, the date upon which
the default is cured or waived or ceases to exist, or
(2) in the case of a default referred to in clause (ii)
above, the earlier of the date on which such default is cured or waived or
ceases to exist or 179 days after the date on which the applicable Payment
Blockage Notice is received if the maturity of such Designated Senior
Indebtedness has not been accelerated,
unless this Article IV otherwise prohibits the payment or distribution at the
time of such payment or distribution (including without limitation, in the case
of default referred to in clause (ii) above, as a result of a payment default
with respect to the applicable Senior Indebtedness as a consequence of the
acceleration of the maturity thereof or otherwise).
Upon any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, moratorium of
payments, insolvency, receivership or other proceedings, all amounts due or to
become due upon all Senior Indebtedness of the Company shall first be paid in
full in cash or other payment satisfactory to the holders of such Senior
Indebtedness of the Company, or payment thereof in accordance with its terms
provided for in cash or other payment satisfactory to the holders of such Senior
Indebtedness of the Company before any payment is made on account of the
principal of, premium, if any, or interest on the Notes by the Company (except
payments by the Company made pursuant to Article XIII from monies deposited with
the
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Trustee pursuant thereto prior to commencement of proceedings for such
dissolution, winding-up, liquidation or reorganization); and upon any such
dissolution or winding-up or liquidation or reorganization of the Company or
bankruptcy, insolvency, receivership or other proceeding, any payment by the
Company, or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the Holders or the Trustee
would be entitled, except for the provision of this Article IV, shall (except as
aforesaid) be paid by the Company or by any receiver, trustee in bankruptcy,
moratorium of payments, liquidating trustee, agent or other Person making such
payment or distribution, or by the Holders or by the Trustee under this
Indenture if received by them or it, directly to the holders of Senior
Indebtedness of the Company (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness of the Company held by such holders,
or as otherwise required by law or a court order) or their Representative or
Representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Senior Indebtedness of the Company may have
been issued, as their respective interests may appear, to the extent necessary
to pay all Senior Indebtedness of the Company in full in cash or other payment
satisfactory to the holders of such Senior Indebtedness of the Company after
giving effect to any concurrent payment or distribution to or for the holders of
Senior Indebtedness of the Company, before any payment or distribution is made
to the Holders or to the Trustee.
For purposes of this Article IV, the words, "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article IV with respect
to the Notes to the payment of all Senior Indebtedness of the Company which may
at the time be outstanding; provided that (i) the Senior Indebtedness of the
Company is assumed by the new corporation, if any, resulting from any
reorganization or readjustment, and (ii) the rights of the holders of Senior
Indebtedness of the Company (other than leases which are not assumed by the
Company or the new corporation, as the case may be) are not, without the consent
of such holders, altered by such reorganization or readjustment. The merger of
the Company into another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article XII shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section 4.2
if such other corporation shall, as a part of such merger, conveyance or
transfer, comply with the conditions stated in Article XII.
In the event of the acceleration of the Notes because of an Event of
Default, no payment or distribution shall be made to the Trustee or any Holder
of Notes in respect of the principal of, premium, if any, or interest on the
Notes by the Company (including, but not limited to, the Redemption Price with
respect to the Notes called for redemption in accordance with Article III or the
Repurchase Price with respect to Notes submitted for repurchase in accordance
with Article XVI, as the case may be, as provided in this Indenture), except
payments and distributions made by the Trustee as permitted by the first or
second paragraph of Section 4.5,
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until all Senior Indebtedness of the Company has been paid in full in cash or
other payment satisfactory to the holders of Senior Indebtedness of the Company
of all obligations in respect of such Senior Indebtedness or such acceleration
is rescinded in accordance with the terms of this Indenture. If payment of the
Notes is accelerated because of an Event of Default, the Company shall promptly
notify holders of Senior Indebtedness of the Company of the acceleration.
In the event that, notwithstanding the foregoing provisions, any payment
or distribution of assets of the Company of any kind or character, whether in
cash, property or securities (including, without limitation, by way of setoff or
otherwise), prohibited by the foregoing, shall be received by the Trustee or the
Holders of the Notes before all Senior Indebtedness of the Company is paid in
full in cash or other payment satisfactory to the holders of such Senior
Indebtedness of the Company, or provision is made for such payment thereof in
accordance with its terms in cash or other payment satisfactory to the holders
of such Senior Indebtedness of the Company, such payment or distribution shall
be held in trust for the benefit of and shall be paid over or delivered to the
holders of Senior Indebtedness of the Company or their Representative or
Representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Senior Indebtedness of the Company may have
been issued, as their respective interests may appear, as calculated by the
Company, for application to the payment of all Senior Indebtedness of the
Company remaining unpaid to the extent necessary to pay all Senior Indebtedness
of the Company in full in cash or other payment satisfactory to the holders of
such Senior Indebtedness of the Company, after giving effect to any concurrent
payment or distribution, or provision therefor, to or for the holders of such
Senior Indebtedness of the Company.
Nothing in this Article IV shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 8.6. This Section 4.2 shall be subject to
the further provisions of Section 4.5.
Section 4.3 Subrogation of Notes. Subject to the payment in full in cash
or other payment satisfactory to the holders of Senior Indebtedness of all
Senior Indebtedness of the Company, the Holders of the Notes shall be subrogated
to the extent of the payments or distributions made to the holders of such
Senior Indebtedness of the Company pursuant to the provisions of this Article IV
(equally and ratably with the holders of all indebtedness of the Company which
by its express terms is subordinated to other indebtedness of the Company to
substantially the same extent as the Notes are subordinated and is entitled to
like rights of subrogation) to the rights of the holders of Senior Indebtedness
of the Company to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness of the Company
until the principal, premium, if any, and interest on the Notes shall be paid in
full; and, for the purposes of such subrogation, no payments or distributions to
the holders of the Senior Indebtedness of the Company of any cash, property or
securities to which the Holders of the Notes or the Trustee would be entitled
except for the provisions of this Article IV, and no payment over pursuant to
the provisions of this Article IV, to or for the benefit of the holders of
Senior Indebtedness of the Company by Holders of the Notes or the Trustee,
shall, as between the Company, its creditors other than holders of Senior
Indebtedness of the
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Company, and the Holders of the Notes, be deemed to be a payment by the Company
to or on account of the Senior Indebtedness of the Company. It is understood
that the provisions of this Article IV are and are intended solely for the
purposes of defining the relative rights of the Holders of the Notes, on the one
hand, and the holders of the Senior Indebtedness of the Company, on the other
hand.
Nothing contained in this Article IV or elsewhere in this Indenture or
in the Notes is intended to or shall impair, as among the Company, its creditors
other than the holders of Senior Indebtedness of the Company, and the Holders of
the Notes, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Notes the principal of (and premium, if any) and
interest on the Notes as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the Holders of the Notes and creditors of the Company other than the
holders of the Senior Indebtedness of the Company, nor shall anything herein or
therein prevent the Trustee or the Holder of any Note from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article IV of the holders
of Senior Indebtedness of the Company in respect of cash, property or securities
of the Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article IV, the Trustee, subject to the provisions of Section 8.1, and the
Holders of the Notes shall be entitled to rely upon any order or decree made by
any court of competent jurisdiction in which such bankruptcy, dissolution,
winding-up, liquidation or reorganization proceedings are pending, or a
certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making such payment or distribution, delivered to the Trustee or
to the Holders of the Notes, for the purpose of ascertaining the Persons
entitled to participate in such distribution, the holders of the Senior
Indebtedness of the Company and other Indebtedness of the Company, the amount
thereof or payable thereon and all other facts pertinent thereto or to this
Article IV.
Section 4.4 Authorization to Effect Subordination. Each Holder of a Note
by the Holder's acceptance thereof authorizes and directs the Trustee on the
Holder's behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article IV and appoints the
Trustee to act as the Holder's attorney-in-fact for any and all such purposes.
If the Trustee does not file a proper proof of claim or proof of debt in the
form required in any proceeding referred to in Section 7.2 hereof at least 30
days before the expiration of the time to file such claim, the holders of any
Senior Indebtedness of the Company or their Representatives are hereby
authorized to file an appropriate claim for and on behalf of the Holders of the
Notes.
Section 4.5 Notice to Trustee. The Company shall give prompt written
notice in the form of an Officers' Certificate to a Responsible Officer of the
Trustee and to any paying agent of any fact known to the Company which would
prohibit the making of any payment of monies deposited by the Company to or by
the Trustee or any paying agent in respect of the Notes
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pursuant to the provisions of this Article IV. Notwithstanding the provisions of
this Article IV or any other provision of this Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit the
making of any payment of monies deposited by the Company to or by the Trustee in
respect of the Notes pursuant to the provisions of this Article IV, unless and
until a Responsible Officer of the Trustee shall have received written notice
thereof at the Corporate Trust Office from the Company (in the form of an
Officers' Certificate) or a Representative of Senior Indebtedness or of a holder
or holders of Senior Indebtedness of the Company or from any trustee thereof;
and before the receipt of any such written notice, the Trustee, subject to the
provisions of Section 8.1, shall be entitled in all respects to assume that no
such facts exist; provided that if on a date not fewer than two Business Days
prior to the date upon which by the terms hereof any such monies may become
payable for any purpose (including, without limitation, the payment of the
principal of, or premium, if any, or interest on any Note) the Trustee shall not
have received, with respect to such monies, the notice provided for in this
Section 4.5, then, anything herein contained to the contrary notwithstanding,
the Trustee shall have full power and authority to receive such monies deposited
by the Company and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary which may be
received by it on or after such prior date.
Notwithstanding anything in this Article IV to the contrary, nothing
shall prevent any payment by the Trustee to the Holders of monies deposited with
it pursuant to Section 13.1, and any such payment shall not be subject to the
provisions of Section 4.1 or 4.2.
The Trustee, subject to the provisions of Section 8.1, shall be entitled
to rely on the delivery to it of a written notice by a Representative or a
Person representing himself to be a holder of Senior Indebtedness of the Company
(or a trustee on behalf of such holder) to establish that such notice has been
given by a Representative or a holder of Senior Indebtedness of the Company or a
trustee on behalf of any such holder or holders. In the event that the Trustee
determines in good faith that further evidence is required with respect to the
right of any Person as a holder of Senior Indebtedness of the Company to
participate in any payment or distribution pursuant to this Article IV, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Indebtedness of the
Company held by such Person, the extent to which such Person is entitled to
participate in such payment or distribution and any other facts pertinent to the
rights of such Person under this Article IV, and if such evidence is not
furnished the Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive such payment.
Section 4.6 Trustee's Relation to Senior Indebtedness of the Company.
The Trustee in its individual capacity shall be entitled to all the rights set
forth in this Article IV in respect of any Senior Indebtedness of the Company at
any time held by it, to the same extent as any other holder of Senior
Indebtedness of the Company, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.
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With respect to the holders of Senior Indebtedness of the Company, the
Trustee undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article IV, and no implied
covenants or obligations with respect to the holders of Senior Indebtedness of
the Company shall be read into this Indenture against the Trustee. The Trustee
shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness of the Company and, subject to the provisions of Section 8.1, the
Trustee shall not be liable to any holder of Senior Indebtedness of the Company
if it shall pay over or deliver to Holders of Notes, the Company or any other
Person money or assets to which any holder of Senior Indebtedness of the Company
shall be entitled by virtue of this Article IV or otherwise.
Section 4.7 No Impairment of Subordination. No right of any present or
future holder of any Senior Indebtedness of the Company to enforce subordination
as herein provided shall at any time in any way be prejudiced or impaired by any
act or failure to act on the part of the Company or by any act or failure to
act, in good faith, by any such holder, or by any noncompliance by the Company
with the terms, provisions and covenants of this Indenture, regardless of any
knowledge thereof which any such holder may have or otherwise be charged with.
Section 4.8 Article Applicable to Paying Agents. If at any time any
paying agent other than the Trustee shall have been appointed by the Company and
be then acting hereunder, the term "Trustee" as used in this Article shall
(unless the context otherwise requires) be construed as extending to and
including such paying agent within its meaning as fully for all intents and
purposes as if such paying agent were named in this Article in addition to or in
place of the Trustee; provided, however, that the first paragraph of Section 4.5
shall not apply to the Company or any Affiliate of the Company if it or such
Affiliate acts as paying agent.
Section 4.9 Senior Indebtedness of the Company Entitled to Rely. The
holders of Senior Indebtedness of the Company (including, without limitation,
Designated Senior Indebtedness) shall have the right to rely upon this Article
IV, and no amendment or modification of the provisions contained herein shall
diminish the rights of such holders unless such holders shall have agreed in
writing thereto.
Section 4.10 Certain Conversions Deemed Payment. For the purposes of
this Article IV only, (1) the issuance and delivery of junior securities upon
conversion of Notes in accordance with Article XV shall not be deemed to
constitute a payment or distribution on account of the principal of (or premium,
if any) or interest on Notes or on account of the purchase or other acquisition
of Notes, and (2) the payment, issuance or delivery of cash (except in
satisfaction of fractional shares pursuant to Section 15.3), property or
securities (other than junior securities) upon conversion of a Note shall be
deemed to constitute payment on account of the principal of such Note. For the
purposes of this Section 4.10, the term "junior securities" means (a) shares of
any stock of any class of the Company (including, without limitation, the Common
Stock of the Company), or (b) securities of the Company which are subordinated
in right of payment to all Senior Indebtedness of the Company which may be
outstanding at the
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time of issuance or delivery of such securities to substantially the same extent
as, or to a greater extent than, the Notes are so subordinated as provided in
this Article IV. Nothing contained in this Article IV or elsewhere in this
Indenture or in the Notes is intended to or shall impair, as among the Company,
its creditors other than holders of Senior Indebtedness of the Company and the
Holders, the right, which is absolute and unconditional, of the Holder of any
Note to convert such Note in accordance with Article XV.
ARTICLE V
PARTICULAR COVENANTS OF THE COMPANY
Section 5.1 Payment of Principal, Premium and Interest. The Company
covenants and agrees that it will duly and punctually pay or cause to be paid
the principal of and premium, if any, and interest on each of the Notes at the
places, at the respective times and in the manner provided herein and in the
Notes.
Section 5.2 Maintenance of Office or Agency. The Company will maintain
in the Borough of Manhattan, The City of New York, an office or agency where the
Notes may be surrendered for registration of transfer or exchange or for
presentation for payment or for conversion, redemption or repurchase and where
notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency not designated or appointed by the Trustee. If at any time the Company
shall fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee or the office of the Trustee or an Affiliate of the Trustee in the
Borough of Manhattan, the City of New York.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York, for such purposes. The Company will give prompt written
notice to the Trustee and the holders of any such designation or rescission and
of any change in the location of any such other office or agency.
The Company hereby initially designates the Trustee as paying agent,
Note registrar and conversion agent and the Corporate Trust Office of the
Trustee and the office or agency of the Trustee in the Borough of Manhattan, The
City of New York (which shall initially be the office of State Street Bank and
Trust Company, N.A., located at 00 Xxxxxxxx, 00xx Xxxxx, Xxxxxxxxx Trust Window,
New York, New York 10006) as one such office or agency of the Company for each
of the aforesaid purposes.
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So long as the Trustee is the Note registrar, the Trustee agrees to
mail, or cause to be mailed, the notice set forth in Section 8.10(a).
Section 5.3 Appointments to Fill Vacancies in Trustee's Office. The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 8.10, a Trustee, so that there
shall at all times be a Trustee hereunder.
Section 5.4 Provisions as to Paying Agent.
(a) If the Company shall appoint a paying agent other than the
Trustee or if the Trustee shall appoint such a paying agent, it will
cause such paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee, subject to
the provisions of this Section 5.4:
(1) that it will hold all sums held by it as such agent
for the payment of the principal of and premium, if any, or
interest on the Notes (whether such sums have been paid to it by
the Company or by any other obligor on the Notes) in trust for
the benefit of the holders of the Notes;
(2) that it will give the Trustee notice of any failure by
the Company (or by any other obligor on the Notes) to make any
payment of the principal of and premium, if any, or interest on
the Notes when the same shall be due and payable; and
(3) that at any time during the continuance of an Event of
Default, upon request of the Trustee, it will forthwith pay to
the Trustee all sums so held in trust.
The Company shall, on or before each due date of the principal
of, premium, if any, or interest on the Notes, deposit with the paying
agent a sum sufficient to pay such principal, premium, if any, or
interest, and (unless such paying agent is the Trustee) the Company will
promptly notify the Trustee of any failure to take such action, provided
that if such deposit is made on the due date, such deposit must be
received by the paying agent by 10:00 a.m., New York City time, on such
date.
(b) If the Company shall act as its own paying agent, it will, on
or before each due date of the principal of, premium, if any, or
interest on the Notes, set aside, segregate and hold in trust for the
benefit of the holders of the Notes a sum sufficient to pay such
principal, premium, if any, or interest so becoming due and will notify
the Trustee of any failure to take such action and of any failure by the
Company (or any other obligor under the Notes) to make any payment of
the principal of, premium, if any, or interest on the Notes when the
same shall become due and payable.
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(c) Anything in this Section 5.4 to the contrary notwithstanding,
the Company may, at any time, for the purpose of obtaining a
satisfaction and discharge of this Indenture, or for any other reason,
pay or cause to be paid to the Trustee all sums held in trust by the
Company or any paying agent hereunder as required by this Section 5.4,
such sums to be held by the Trustee upon the trusts herein contained and
upon such payment by the Company or any paying agent to the Trustee, the
Company or such paying agent shall be released from all further
liability with respect to such sums.
(d) Anything in this Section 5.4 to the contrary notwithstanding,
the agreement to hold sums in trust as provided in this Section 5.4 is
subject to Sections 13.3 and 13.4.
Section 5.5 Existence. Subject to Article XII, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its existence, rights (charter and statutory) and franchises; provided,
however, that the Company shall not be required to preserve any such right or
franchise if it shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.
Section 5.6 Stay, Extension and Usury Laws. The Company covenants (to
the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would prohibit or
forgive the Company from paying all or any portion of the principal of or
interest on the Notes as contemplated herein, wherever enacted, now or at any
time hereafter in force, or which may affect the covenants or the performance of
this Indenture; and the Company (to the extent it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law has been enacted.
Section 5.7 Statement by Officers as to Default. The Company will
deliver to the Trustee within 120 days after the end of each fiscal year of the
Company an Officers' Certificate in which one of the two officers signing such
certificate is either the principal executive officer, principal financial
officer or principal accounting officer at the Company stating that in the
course of performance by the signers of their duties as such officers of the
Company they would normally obtain knowledge of whether any default exists in
the performance and observance of any of the terms, provisions and conditions of
this Indenture and whether the Company has kept, observed, performed and
fulfilled its obligations under this Indenture. Such Officers' Certificate shall
further state, as to each such officer signing such Officers' Certificate, to
the best of the knowledge of such officer, as of the date of such Officers'
Certificate, (a) whether any such default exists, (b) whether the Company (as
applicable) during the preceding fiscal year kept, observed, performed and
fulfilled each and every covenant and obligation of the Company under this
Indenture and (c) whether there was any default in the performance and
observance of any of
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the terms, provisions or conditions of this Indenture during such preceding
fiscal year. If the officer or officers signing the Officers' Certificate know
of such a default, whether then existing or occurring during such preceding
fiscal year, the Officers' Certificate shall describe such default and its
status with particularity. The Company shall also promptly notify the Trustee if
the Company's fiscal year is changed so that the end thereof is on any date
other than the then current fiscal year end date.
The Company will deliver to the Trustee, forthwith upon becoming aware
of any default in the performance or observance of any covenant, agreement or
condition contained in this Indenture, or any Event of Default, an Officers'
Certificate specifying with particularity such default or Event of Default and
further stating what action the Company has taken, is taking or proposes to take
with respect thereto.
Any notice required to be given under this Section 5.7 shall be
delivered to the Trustee at its Corporate Trust Office.
Section 5.8 Further Instruments and Acts. Upon request of the Trustee,
the Company will execute and deliver such further instruments and do such
further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
ARTICLE VI
HOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
Section 6.1 Holders' Lists. The Company covenants and agrees that it
will furnish or cause to be furnished to the Trustee, semi-annually, not more
than fifteen (15) days after each February 15 and August 15 in each year
beginning with August 15, 1998, and at such other times as the Trustee may
request in writing, within thirty (30) days after receipt by the Company of any
such request (or such lesser time as the Trustee may reasonably request in order
to enable it to timely provide any notice to be provided by it hereunder), a
list in such form as the Trustee may reasonably require of the names and
addresses of the holders of Notes as of a date not more than fifteen (15) days
(or such other date as the Trustee may reasonably request in order to so provide
any such notices) prior to the time such information is furnished, except that
no such list need be furnished so long as the Trustee is acting as Note
registrar.
Section 6.2 Preservation and Disclosure of Lists.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of the
holders of Notes contained in the most recent list furnished to it as provided
in Section 6.1 or maintained by the Trustee in its capacity as Note registrar,
if so acting. The Trustee may destroy any list furnished to it as provided in
Section 6.1 upon receipt of a new list so furnished.
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(b) The rights of Holders to communicate with other holders of
Notes with respect to their rights under this Indenture or under the Notes and
the corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Holder, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of holders of Notes made pursuant to the
Trust Indenture Act.
Section 6.3 Reports by Trustee.
(a) Within sixty (60) days after May 15 of each year commencing
with the year 1998, the Trustee shall transmit to holders of Notes such reports
dated as of May 15 of the year in which such reports are made concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
(b) A copy of such report shall, at the time of such transmission
to holders of Notes, be filed by the Trustee with each stock exchange and
automated quotation system upon which the Notes are listed and with the Company.
The Company will notify the Trustee when the Notes are listed on any stock
exchange or automated quotation system and when any such listing is
discontinued.
Section 6.4 Reports by Company. The Company shall file with the Trustee
and the Commission, and transmit to holders of Notes, such information,
documents and other reports and such summaries thereof, as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant to such Act; provided that any such information, documents or reports
required to be filed with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act shall be filed with the Trustee within fifteen (15) days after the
same is so required to be filed with the Commission.
ARTICLE VII
DEFAULTS AND REMEDIES
Section 7.1 Events of Default. In case one or more of the following
Events of Default (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body) shall have occurred and be
continuing:
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(a) default in the payment of the principal of and premium, if
any, on any of the Notes as and when the same shall become due and
payable either at maturity or in connection with any redemption pursuant
to Article III or repurchase pursuant to Article XVI, by declaration or
otherwise, whether or not such payment is prohibited by the provisions
of Article IV; or
(b) default in the payment of any installment of interest upon
any of the Notes as and when the same shall become due and payable, and
continuance of such default for a period of thirty (30) days, whether or
not such payment is prohibited by the subordination provisions of
Article IV; or
(c) failure on the part of the Company duly to observe or perform
any other of the covenants or agreements on the part of the Company in
the Notes or in this Indenture (other than a covenant or agreement a
default in whose performance or whose breach is elsewhere in this
Section specifically dealt with) continued for a period of sixty (60)
days after the date on which written notice of such failure, requiring
the Company to remedy the same, shall have been given to the Company by
the Trustee, or to the Company and a Responsible Officer of the Trustee
by the holders of at least 25% in aggregate principal amount of the
Notes at the time outstanding determined in accordance with Section 9.4;
or
(d) the Company shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it
or any substantial part of its property, or shall consent to any such
relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against
it, or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due; or
(e) an involuntary case or other proceeding shall be commenced
against the Company seeking liquidation, reorganization or other relief
with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment
of a trustee, receiver, liquidator, custodian or other similar official
of it or any substantial part of its property, and such involuntary case
or other proceeding shall remain undismissed and unstayed for a period
of sixty (60) consecutive days;
then, and in each and every such case (other than an Event of Default specified
in Section 7.1(d) or (e)), unless the principal of all of the Notes shall have
already become due and payable, either the Trustee or the holders of not less
than 25% in aggregate principal amount of the Notes then outstanding hereunder
determined in accordance with Section 9.4, by notice in writing to the Company
(and to the Trustee if given by Holders), may declare the principal of and
premium, if
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any, on all the Notes and the interest accrue thereon to be due and payable
immediately, and upon any such declaration the same shall become and shall be
immediately due and payable, anything in this Indenture or in the Notes
contained to the contrary notwithstanding. If an Event of Default specified in
Section 7.1(d) or (e) occurs and is continuing, the principal of, and premium,
if any, on all the Notes and the interest accrued thereon shall be immediately
due and payable. This provision, however, is subject to the condition that if,
at any time after the principal of the Notes shall have been so declared due and
payable, and before any judgment or decree for the payment of the monies due
shall have been obtained or entered as hereinafter provided, the Company shall
pay or shall deposit with the Trustee a sum sufficient to pay all matured
installments of interest upon all Notes and the principal of and premium, if
any, on any and all Notes which shall have become due otherwise than by
acceleration (with interest on overdue installments of interest (to the extent
that payment of such interest is enforceable under applicable law) and on such
principal and premium, if any, at the rate borne by the Notes, to the date of
such payment or deposit) and amounts due to the Trustee pursuant to Section 8.6,
and if any and all defaults under this Indenture, other than the nonpayment of
principal of and premium, if any, and accrued interest on Notes which shall have
become due by acceleration, shall have been cured or waived pursuant to Section
7.7, then and in every such case the holders of a majority in aggregate
principal amount of the Notes then outstanding, by written notice to the Company
and to the Trustee, may waive all defaults or Events of Default and rescind and
annul such declaration and its consequences; but no such waiver or rescission
and annulment shall extend to or shall affect any subsequent default or Event of
Default, or shall impair any right consequent thereon. The Company shall notify
a Responsible Officer of the Trustee, promptly upon becoming aware thereof, of
any Event of Default.
In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned because
of such waiver or rescission and annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the holders of Notes, and the Trustee shall be restored respectively to
their several positions and rights hereunder, and all rights, remedies and
powers of the Company, the holders of Notes, and the Trustee shall continue as
though no such proceeding had been instituted.
Section 7.2 Payments of Notes on Default; Suit Therefor. The Company
covenants that (a) in case default shall be made in the payment by the Company
of any installment of interest upon any of the Notes as and when the same shall
become due and payable, and such default shall have continued for a period of
thirty (30) days, or (b) in case default shall be made in the payment of the
principal of or premium, if any, on any of the Notes as and when the same shall
have become due and payable, whether at maturity of the Notes or in connection
with any redemption or repurchase, by declaration under this Indenture or
otherwise, then, upon demand of the Trustee, the Company will pay to the
Trustee, for the benefit of the holders of the Notes, the whole amount that then
shall have become due and payable on all such Notes for principal and premium,
if any, or interest, or both, as the case may be, with interest upon the overdue
principal and premium, if any, and (to the extent that payment of such interest
is enforceable
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under applicable law) upon the overdue installments of interest at the rate
borne by the Notes; and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including reasonable
compensation to the Trustee, its agents, attorneys and counsel, and any expenses
or liabilities incurred by the Trustee hereunder other than through its
negligence or bad faith. Until such demand by the Trustee, the Company may pay
the principal of and premium, if any, and interest on the Notes to the
registered holders, whether or not the Notes are overdue.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on the Notes
and collect in the manner provided by law out of the property of the Company or
any other obligor on the Notes wherever situated the monies adjudged or decreed
to be payable.
In the case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Notes under Title
11 of the United States Code, or any other applicable law, or in case a
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
sequestrator or similar official shall have been appointed for or taken
possession of the Company or such other obligor, the property of the Company or
such other obliger, or in the case of any other judicial proceedings relative to
the Company or such other obligor upon the Notes, or to the creditors or
property of the Company or such other obligor, the Trustee, irrespective of
whether the principal of the Notes shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand pursuant to the provisions of this Section 7.2, shall
be entitled and empowered, by intervention in such proceedings or otherwise, to
file and prove a claim or claims for the whole amount of principal, premium, if
any, and interest owing and unpaid in respect of the Notes, and, in case of any
judicial proceedings, to file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee and
of the Holders allowed in such judicial proceedings relative to the Company or
any other obligor on the Notes, its or their creditors, or its or their
property, and to collect and receive any monies or other property payable or
deliverable on any such claims, and to distribute the same after the deduction
of any amounts due the Trustee under Section 8.6; and any receiver, assignee or
trustee in bankruptcy or reorganization, liquidator, custodian or similar
official is hereby authorized by each of the Holders to make such payments to
the Trustee, and, in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due it
for reasonable compensation, expenses, advances and disbursements, including
counsel fees incurred by it up to the date of such distribution. To the extent
that such payment of reasonable compensation, expenses, advances and
disbursements out of the estate in any such proceedings shall be denied for any
reason, payment of the same shall be secured by a lien on, and shall be paid out
of, any and all distributions, dividends, monies, securities and other
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property which the holders of the Notes may be entitled to receive in such
proceedings, whether in liquidation or under any plan of reorganization or
arrangement or otherwise.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or adopt on behalf of any Holder any plan of
reorganization or arrangement affecting the Notes or the rights of any Holder,
or to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding, provided, however, that the Trustee may, on behalf of the
Holders, vote for the election of a trustee in bankruptcy or similar official
and may be a member of the creditor's committee established with respect to such
bankruptcy.
All rights of action and of asserting claims under this Indenture, or
under any of the Notes, may be enforced by the Trustee without the possession of
any of the Notes, or the production thereof at any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the holders of the Notes.
In any proceedings brought by the Trustee (and in any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the holders
of the Notes, and it shall not be necessary to make any holders of the Notes
parties to any such proceedings.
Section 7.3 Application of Monies Collected by Trustee. Any monies
collected by the Trustee pursuant to this Article VII shall be applied in the
order following, at the date or dates fixed by the Trustee for the distribution
of such monies, upon presentation of the several Notes, and stamping thereon the
payment, if only partially paid, and upon surrender thereof, if fully paid:
First: To the payment of all amounts due the Trustee under
Section 8.6;
Second: Subject to the provisions of Article IV, in case the
principal of the outstanding Notes shall not have become due and be
unpaid, to the payment of interest on the Notes in default in the order
of the maturity of the installments of such interest, with interest (to
the extent that such interest has been collected by the Trustee) upon
the overdue installments of interest at the rate borne by the Notes,
such payments to be made ratably to the Persons entitled thereto;
Third: Subject to the provisions of Article IV, in case the
principal of the outstanding Notes shall have become due, by declaration
or otherwise, and be unpaid, to the payment of the whole amount then
owing and unpaid upon the Notes for principal and premium, if any, and
interest, with interest on the overdue principal and premium, if any,
and (to the extent that such interest has been collected by the Trustee)
upon overdue
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installments of interest at the rate borne by the Notes; and in case
such monies shall be insufficient to pay in full the whole amounts so
due and unpaid upon the Notes, then to the payment of such principal and
premium, if any, and interest without preference or priority of
principal and premium, if any, over interest, or of interest over
principal and premium, if any, or of any installment of interest over
any other installment of interest, or of any Note over any other Note,
ratably to the aggregate of such principal and premium, if any, and
accrued and unpaid interest; and
Fourth: Subject to the provisions of Article IV, to the payment
of the remainder, if any, to the Company or any other Person lawfully
entitled thereto.
Section 7.4 Proceedings by Holder. No Holder of any Note shall have any
right by virtue of or by availing of any provision of this Indenture to
institute any suit, action or proceeding in equity or at law upon or under or
with respect to this Indenture, or for the appointment of a receiver, trustee,
liquidator, custodian or other similar official, or for any other remedy
hereunder, unless such holder previously shall have given to the Trustee written
notice of an Event of Default and of the continuance thereof, as hereinbefore
provided, and unless also the holders of not less than 25% in aggregate
principal amount of the Notes then outstanding shall have made written request
upon the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable security
or indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee for sixty (60) days after its
receipt of such notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding and no direction
inconsistent with such written request shall have been given to the Trustee
pursuant to Section 7.7; it being understood and intended, and being expressly
covenanted by the taker and holder of every Note with every other taker and
holder and the Trustee, that no one or more holders of Notes shall have any
right in any manner whatever by virtue of or by availing of any provision of
this Indenture to affect, disturb or prejudice the rights of any other holder of
Notes, or to obtain or seek to obtain priority over or preference to any other
such holder, or to enforce any right under this Indenture, except in the manner
herein provided and for the equal, ratable and common benefit of all holders of
Notes (except as otherwise provided herein). For the protection and enforcement
of this Section 7.4, each and every Holder and the Trustee shall be entitled to
such relief as can be given either at law or in equity.
Notwithstanding any other provision in this Indenture, the Holder of any
Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of, premium, if any, and interest on such Note on the
respective stated maturities expressed in such Note (or, in the case of
redemption or repurchase, on the Redemption Date or Repurchase Date, as the case
may be), and to convert such Note in accordance with Article XV, and to
institute suit for the enforcement of any such payment and right to convert, and
such rights shall not be impaired without the consent of such Holder.
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Section 7.5 Proceedings by Trustee. In case of an Event of Default the
Trustee may in its discretion proceed to protect and enforce the rights vested
in it by this Indenture by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any of such rights, either by
suit in equity or by action at law or by proceeding in bankruptcy or otherwise,
whether for the specific enforcement of any covenant or agreement contained in
this Indenture or in aid of the exercise of any power granted in this Indenture,
or to enforce any other legal or equitable right vested in the Trustee by this
Indenture or by law.
Section 7.6 Remedies Cumulative and Continuing. Except as provided in
the last paragraph of Section 2.6, all powers and remedies given by this Article
VII to the Trustee or to the Holders shall, to the extent permitted by law, be
deemed cumulative and not exclusive of any thereof or of any other powers and
remedies available to the Trustee or the holders of the Notes, by judicial
proceedings or otherwise, to enforce the performance or observance of the
covenants and agreements contained in this Indenture, and no delay or omission
of the Trustee or of any holder of any of the Notes to exercise any right or
power accruing upon any default or Event of Default occurring and continuing as
aforesaid shall impair any such right or power, or shall be construed to be a
waiver of any such default or any acquiescence therein; and, subject to the
provisions of Section 7.4, every power and remedy given by this Article VII or
by law to the Trustee or to the Holders may be exercised from time to time, and
as often as shall be deemed expedient, by the Trustee or by the Holders.
Section 7.7 Direction of Proceedings and Waiver of Defaults by Majority
of Holders. Subject to Section 8.2(d) the Holders of a majority in aggregate
principal amount of the Notes at the time outstanding determined in accordance
with Section 9.4 shall have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee; provided, however, that (a) such
direction shall not be in conflict with any rule of law or with this Indenture,
and (b) the Trustee may, but shall have no obligation to, take any other action
deemed proper by the Trustee which is not inconsistent with such direction. The
holders of a majority in aggregate principal amount of the Notes at the time
outstanding determined in accordance with Section 9.4 may on behalf of the
holders of all of the Notes waive any past default or Event of Default hereunder
and its consequences except (i) a default in the payment of interest or premium,
if any, on, or the principal of, the Notes (including the payment of any
Redemption Price or Repurchase Price), (ii) a failure by the Company to convert
any Notes into Common Stock or (iii) a default in respect of a covenant or
provisions hereof which under Article XI cannot be modified or amended without
the consent of the holders of all Notes then outstanding. Upon any such waiver
the Company, the Trustee and the holders of the Notes shall be restored to their
former positions and rights hereunder; but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon. Whenever any default or Event of Default hereunder shall have been
waived as permitted by this Section 7.7, said default or Event of Default shall
for all purposes of the Notes and this Indenture be deemed to have been cured
and to be not continuing; but no such waiver shall extend to any subsequent or
other default or Event of Default or impair any right consequent thereon.
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Section 7.8 Notice of Defaults. The Trustee shall, within ninety (90)
days after the occurrence of a default, mail to all Holders, as the names and
addresses of such holders appear upon the Note register, notice of all defaults
known to a Responsible Officer, unless such defaults shall have been cured or
waived before the giving of such notice; and provided that, except in the case
of default in the payment of the principal of, or premium, if any, or interest
on any of the Notes, or in the payment of any redemption or repurchase
obligation, the Trustee shall be protected in withholding such notice if and so
long as a trust committee of directors and/or Responsible Officers of the
Trustee in good faith determines that the withholding of such notice is in the
best interest of the Holders.
Section 7.9 Undertaking to Pay Costs. All parties to this Indenture
agree, and each holder of any Note by his acceptance thereof shall be deemed to
have agreed, that any court may, in its discretion, require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit and
that such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such suit, having due
regard to the merits and good faith of the claims or defenses made by such party
litigant; provided that the provisions of this Section 7.9 shall not apply to
any suit instituted by the Trustee, to any suit instituted by any Holder, or
group of Holders, holding in the aggregate more than 10% in principal amount of
the Notes at the time outstanding determined in accordance with Section 9.4, or
to any suit instituted by any Holder for the enforcement of the payment of the
principal of or premium, if any, or interest on any Note on or after the due
date expressed in such Note or to any suit for the enforcement of the right to
convert any Note in accordance with the provisions of Article XV or to require
the Company to repurchase any Note in accordance with Article XVI.
Section 7.10 Delay or Omission Not Waiver. No delay or omission of the
Trustee or of any holder of any Note to exercise any right or remedy accruing
upon any Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or any acquiescence therein. Every right and
remedy given by this Article or by law to the Trustee or to the holders of Notes
may be exercised from time to time, and as often as may be deemed expedient, by
the Trustee or by the holders of Notes, as the case may be.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.1 Duties and Responsibilities of Trustee. The Trustee, prior
to the occurrence of an Event of Default and after the curing of all Events of
Default which may have occurred, undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture. In case an Event of
Default has occurred (which has not been cured or waived) the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and use
the
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same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have occurred:
(1) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Indenture and
the Trust Indenture Act, and the Trustee shall not be liable
except for the performance of such duties and obligations as are
specifically set forth in this Indenture and no implied covenants
or obligations shall be read into this Indenture and the Trust
Indenture Act against the Trustee; and
(2) in the absence of bad faith and willful misconduct on
the part of the Trustee, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture;
but, in the case of any such certificates or opinions which by
any provisions hereof are specifically required to be furnished
to the Trustee, the Trustee shall be under a duty to examine the
same to determine whether or not they conform to the requirements
of this Indenture;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Officers of the Trustee,
unless it shall be provided that the Trustee was negligent in
ascertaining the pertinent facts;
(c) the Trustee shall not be liable to any Holder with respect to
any action taken or omitted to be taken by it in good faith in
accordance with the direction of the holders of not less than a majority
in principal amount of the Notes at the time outstanding determined as
provided in Section 9.4 relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture; and
(d) whether or not therein provided, every provision of this
Indenture relating to the conduct or affecting the liability of, or
affording protection to, the Trustee shall be subject to the provisions
of this Section.
None of the provisions contained in this Indenture shall require
the Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of
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any of its duties or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Section 8.2 Reliance on Documents, Opinions, Etc. Except as otherwise
provided in Section 8.1:
(a) the Trustee may rely and shall be protected in acting upon
any resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, order, bond, note, coupon or other paper or
document believed by it in good faith to be genuine and to have been
signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company
mentioned herein shall be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof be herein
specifically prescribed); and any resolution of the Board of Directors
may be evidenced to the Trustee by a copy thereof certified by the
Secretary or an Assistant Secretary of the Company;
(c) the Trustee may consult with counsel and any advice or
Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or omitted by it hereunder in
good faith and in accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request,
order or direction of any of the Holders pursuant to the provisions of
this Indenture, unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;
(e) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Trustee shall determine
to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by
agent or attorney; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is, in
the opinion of the Trustee, not reasonably assured to the Trustee by the
security afforded to it by the terms of this Indenture, the Trustee may
require reasonable indemnity from the Holders against such expenses or
liability as a condition to so proceeding; the reasonable expenses of
every such examination shall be paid by the Company or, if paid by the
Trustee or any predecessor Trustee, shall be repaid by the Company upon
demand; and
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(f) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents
or attorneys and the Trustee shall not be responsible for any misconduct
or negligence on the part of any agent or attorney appointed by it with
due care hereunder.
Section 8.3 No Responsibility for Recitals, Etc. The recitals contained
herein and in the Notes (except in the Trustee's certificate of authentication)
shall be taken as the statements of the Company, and the Trustee assumes no
responsibility for the correctness of the same. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Notes. The Trustee shall not be accountable for the use or application by the
Company of any Notes or the proceeds of any Notes authenticated and delivered by
the Trustee in conformity with the provisions of this Indenture.
Section 8.4 Trustee, Paying Agents, Conversion Agents or Registrar May
Own Notes. The Trustee, any paying agent, any conversion agent or Note
registrar, in its individual or any other capacity, may become the owner or
pledgee of Notes with the same rights it would have if it were not Trustee,
paying agent, conversion agent or Note registrar.
Section 8.5 Monies to Be Held in Trust. Subject to the provisions of
Section 13.4, all monies received by the Trustee shall, until used or applied as
herein provided, be held in trust for the purposes for which they were received.
Money held by the Trustee in trust hereunder need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as may be
agreed from time to time by the Company and the Trustee.
Section 8.6 Compensation and Expenses of Trustee. The Company covenants
and agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, reasonable compensation for all services rendered by it hereunder
in any capacity (which shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust), and the Company will pay or
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances reasonably incurred or made by the Trustee in
accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all persons not regularly in its employ) except any such expense, disbursement
or advance as may arise from its negligence or bad faith. The Company also
covenants to indemnify the Trustee in any capacity under this Indenture and its
agents and any authenticating agent for, and to hold them harmless against, any
loss, liability or expense incurred without negligence, willful misconduct,
recklessness or bad faith on the part of the Trustee or such agent or
authenticating agent, as the case may be, and arising out of or in connection
with the acceptance or administration of this trust or in any other capacity
hereunder, including the costs and expenses of defending themselves against any
claim of liability in the premises. The obligations of the Company under this
Section 8.6 to compensate or indemnify the Trustee and to pay or reimburse the
Trustee for expenses, disbursements and advances shall be secured by a lien upon
all property and funds held or collected by the Trustee as such, except
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funds held in trust for the benefit of the holders of particular Notes. The
obligation of the Company under this Section shall survive the satisfaction and
discharge of this Indenture.
When the Trustee and its agents and any authenticating agent incur
expenses or render services after an Event of Default specified in Section
7.1(d) or (e) occurs, the expenses and the compensation for the services are
intended to constitute expenses of administration under any bankruptcy,
insolvency or similar laws.
Section 8.7 Officers' Certificate as Evidence. Except as otherwise
provided in Section 8.1, whenever in the administration of the provisions of
this Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or omitting any action hereunder, such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence, willful misconduct, recklessness
and bad faith on the part of the Trustee, be deemed to be conclusively proved
and established by an Officers' Certificate delivered to the Trustee, and such
Officers' Certificate, in the absence of negligence, willful misconduct,
recklessness and bad faith on the part of the Trustee, shall be full warrant to
the Trustee for any action taken or omitted by it under the provisions of this
Indenture upon the faith thereof.
Section 8.8 Conflicting Interests of Trustee. If the Trustee has or
shall acquire a conflicting interest within the meaning of the Trust Indenture
Act, the Trustee shall either eliminate such interest or resign, to the extent
and in the manner provided by, and subject to the provisions of, the Trust
Indenture Act and this Indenture.
Section 8.9 Eligibility of Trustee. There shall at all times be a
Trustee hereunder which shall be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and has (or if the Trustee is a member of a bank
holding company, its bank holding company has) a combined capital and surplus of
at least $50,000,000. If such Person publishes reports of condition at least
annually, pursuant to law or to the requirements of any supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
Section 8.10 Resignation or Removal of Trustee.
(a) The Trustee may at any time resign by giving written notice
of such resignation to the Company and by mailing notice thereof to the
holders of Notes at their addresses as they shall appear on the Note
register. Upon receiving such notice of resignation, the Company shall
promptly appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of
which instrument shall be delivered to the resigning Trustee and one
copy to the successor
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trustee. If no successor trustee shall have been so appointed and have
accepted appointment sixty (60) days after the mailing of such notice of
resignation to the Holders, the resigning Trustee may petition any court
of competent jurisdiction for the appointment of a successor trustee, or
any Holder who has been a bona fide holder of a Note or Notes for at
least six months may, subject to the provisions of Section 7.9, on
behalf of himself and all others similarly situated, petition any such
court for the appointment of a successor trustee. Such court may
thereupon, after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with Section 8.8
after written request therefor by the Company or by any Holder
who has been a bona fide holder of a Note or Notes for at least
six months, or
(2) the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.9 and shall fail to resign after
written request therefor by the Company or by any such Holder, or
(3) the Trustee shall become incapable of acting, or shall
be adjudged a bankrupt or insolvent, or a receiver of the Trustee
or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order
of the Board of Directors, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor
trustee, or, subject to the provisions of Section 7.9, any Holder who
has been a bona fide holder of a Note or Notes for at least six months
may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor trustee. Such court may thereupon, after
such notice, if any, as it may deem proper and prescribe, remove the
Trustee and appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount of
the Notes at the time outstanding may at any time remove the Trustee and
nominate a successor trustee which shall be deemed appointed as
successor trustee unless within ten (10) days after notice to the
Company of such nomination the Company objects thereto, in which case
the Trustee so removed or any Holder, upon the terms and conditions and
otherwise as in Section 8.10(a) provided, may petition any court of
competent jurisdiction for an appointment of a successor trustee.
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(d) Any resignation or removal of the Trustee and appointment of
a successor trustee pursuant to any of the provisions of this Section
8.10 shall become effective upon acceptance of appointment by the
successor trustee as provided in Section 8.11.
Section 8.11 Acceptance by Successor Trustee. Any successor trustee
appointed as provided in Section 8.10 shall execute, acknowledge and deliver to
the Company and to its predecessor trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all the rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as trustee herein; but, nevertheless, on the written request
of the Company or of the successor trustee, the trustee ceasing to act shall,
upon payment of any amounts then due it pursuant to the provisions of Section
8.6, execute and deliver an instrument transferring to such successor trustee
all the rights and powers of the trustee so ceasing to act. Upon request of any
such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor
trustee all such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a lien upon all property and funds held or collected by
such trustee as such, except for funds held in trust for the benefit of holders
of particular Notes, to secure any amounts then due it pursuant to the
provisions of Section 8.6.
No successor trustee shall accept appointment as provided in this
Section 8.11 unless at the time of such acceptance such successor trustee shall
be qualified under the provisions of Section 8.8 and be eligible under the
provisions of Section 8.9.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.11, the Company shall mail or cause to be mailed notice of the
succession of the former trustee hereunder to the holders of Notes at their
addresses as they shall appear on the Note register. If the Company fails to
mail such notice within ten (10) days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of the Company.
Section 8.12 Succession by Merger, Etc. Any corporation into which the
Trustee may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation succeeding to all or substantially
all of the corporate trust business of the Trustee, including the trust created
by this Indenture, shall be the successor to the Trustee hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that in the case of any corporation succeeding to all
or substantially all of the trust business of the Trustee such corporation shall
be qualified under the provisions of Section 8.8 and eligible under the
provisions of Section 8.9.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture, any of the Notes shall have been authenticated
but not delivered, any such successor to
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the Trustee may adopt the certificate of authentication of any predecessor
trustee or authenticating agent appointed by such predecessor trustee, and
deliver such Notes so authenticated; and in case at that time any of the Notes
shall not have been authenticated, any successor to the Trustee or an
authenticating agent appointed by such successor trustee may authenticate such
Notes either in the name of any predecessor trustee hereunder or in the name of
the successor trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Notes or in this Indenture provided that
the certificate of the Trustee shall have; provided, however, that the right to
adopt the certificate of authentication of any predecessor Trustee or to
authenticate Notes in the name of any predecessor Trustee shall apply only to
its successor or successors by merger, conversion or consolidation.
Section 8.13 Limitation on Rights of Trustee as Creditor. If and when
the Trustee shall be or become a creditor of the Company (or any other obligor
upon the Notes), the Trustee shall be subject to the provisions of the Trust
Indenture Act regarding the collection of the claims against the Company (or any
such other obligor).
ARTICLE IX
CONCERNING THE HOLDERS
Section 9.1 Action by Holders. Whenever in this Indenture it is provided
that the holders of a specified percentage in aggregate principal amount of the
Notes may take any action (including the making of any demand or request, the
giving of any notice, consent or waiver or the taking of any other action), the
fact that at the time of taking any such action, the holders of such specified
percentage have joined therein may be evidenced (a) by any instrument or any
number of instruments of similar tenor executed by Holders in person or by agent
or proxy appointed in writing, or (b) by the record of the holders of Notes
voting in favor thereof at any meeting of Holders duly called and held in
accordance with the provisions of Article X, or (c) by a combination of such
instrument or instruments and any such record of such a meeting of Holders.
Whenever the Company or the Trustee solicits the taking of any action by the
holders of the Notes, the Company or the Trustee may fix in advance of such
solicitation, a date as the record date for determining holders entitled to take
such action. The record date shall be not more than fifteen (15) days prior to
the date of commencement of solicitation of such action.
Section 9.2 Proof of Execution by Holders. Subject to the provisions of
Sections 8.1, 8.2 and 10.5, proof of the execution of any instrument by a Holder
or his agent or proxy shall be sufficient if made in accordance with such
reasonable rules and regulations as may be prescribed by the Trustee or in such
manner as shall be satisfactory to the Trustee. The holding of Notes shall be
proved by the Note register or by a certificate of the Note registrar.
The record of any Holders' meeting shall be proved in the manner
provided in Section 10.6.
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Section 9.3 Who Are Deemed Absolute Owners. The Company, the Trustee,
any authenticating agent, any paying agent, any conversion agent and any Note
registrar may deem the Person in whose name such Note shall be registered upon
the Note register to be, and may treat him as, the absolute owner of such Note
(whether or not such Note shall be overdue and notwithstanding any notation of
ownership or other writing thereon) for the purpose of receiving payment of or
on account of the principal of, premium, if any, and interest on such Note, for
conversion of such Note and for all other purposes; and neither the Company nor
the Trustee, nor any paying agent, nor any conversion agent nor any Note
registrar shall be affected by any notice to the contrary. All such payments so
made to any holder for the time being, or upon his order, shall be valid, and,
to the extent of the sum or sums so paid, effectual to satisfy and discharge the
liability for monies payable upon any such Note.
Section 9.4 Company-Owned Notes Disregarded. In determining whether the
holders of the requisite aggregate principal amount of Notes have concurred in
any direction, consent, waiver or other action under this Indenture, Notes which
are owned by the Company or any other obligor on the Notes or by any Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Company or any other obligor on the Notes shall be
disregarded and deemed not to be outstanding for the purpose of any such
determination; provided that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, consent, waiver or other
action only Notes which a Responsible Officer knows are so owned shall be so
disregarded. Notes so owned which have been pledged in good faith may be
regarded as outstanding for the purposes of this Section 9.4 if the pledgee
shall establish to the satisfaction of the Trustee the pledgee's right to vote
such Notes and that the pledgee is not the Company, any other obligor on the
Notes or a Person directly or indirectly controlling or controlled by or under
direct or indirect common control with the Company or any such other obligor. In
the case of a dispute as to such right, any decision by the Trustee taken upon
the advice of counsel shall be full protection to the Trustee. Upon request of
the Trustee, the Company shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying all Notes, if any, known by the Company to
be owned or held by or for the account of any of the above described Persons;
and, subject to Section 8.1, the Trustee shall be entitled to accept such
Officers' Certificate as conclusive evidence of the facts therein set forth and
of the fact that all Notes not listed therein are outstanding for the purpose of
any such determination.
Section 9.5 Revocation of Consents; Future Holders Bound. At any time
prior to (but not after) the evidencing to the Trustee, as provided in Section
9.1, of the taking of any action by the holders of the percentage in aggregate
principal amount of the Notes specified in this Indenture in connection with
such action, any holder of a Note which is shown by the evidence to be included
in the Notes the holders of which have consented to such action may, by filing
written notice with the Trustee at its Corporate Trust Office and upon proof of
holding as provided in Section 9.2, revoke such action so far as it concerns
such Note. Except as aforesaid, any such action taken by the holder of any Note
shall be conclusive and binding upon such holder and upon all future holders and
owners of such Note and of any Notes issued in exchange
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or substitution therefor, irrespective of whether any notation in regard thereto
is made upon such Note or any Note issued in exchange or substitution therefor.
ARTICLE X
HOLDERS' MEETINGS
Section 10.1 Purpose of Meetings. A meeting of Holders may be called at
any time and from time to time pursuant to the provisions of this Article X for
any of the following purposes:
(1) to give any notice to the Company or to the Trustee or to
give any directions to the Trustee permitted under this Indenture, or to
consent to the waiving of any default or Event of Default hereunder and
its consequences, or to take any other action authorized to be taken by
Holders pursuant to any of the provisions of Article VII;
(2) to remove the Trustee and nominate a successor trustee
pursuant to the provisions of Article VIII;
(3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 11.2;
(4) to take any other action authorized to be taken by or on
behalf of the holders of any specified aggregate principal amount of the
Notes under any other provision of this Indenture or under applicable
law; or
(5) to take any other action authorized by this Indenture or
under applicable law.
Section 10.2 Call of Meetings by Trustee. The Trustee may at any time
call a meeting of Holders to take any action specified in Section 10.1, to be
held at such time and at such place in the Borough of Manhattan, The City of New
York, or any other reasonably convenient city in the continental United States,
as the Trustee shall determine. Notice of every meeting of the Holders, setting
forth the time and the place of such meeting and in general terms the action
proposed to be taken at such meeting and the establishment of any record date
pursuant to Section 9.1, shall be mailed to holders of Notes at their addresses
as they shall appear on the Note register. Such notice shall also be mailed to
the Company. Such notices shall be mailed not less than twenty (20) nor more
than ninety (90) days prior to the date fixed for the meeting.
Any meeting of Holders shall be valid without notice if the holders of
all Notes then outstanding are present in person or by proxy or if notice is
waived before or after the meeting by the holders of all Notes outstanding, and
if the Company and the Trustee are either present by duly authorized
representatives or have, before or after the meeting, waived notice.
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Section 10.3 Call of Meetings by Company or Holders. In case at any time
the Company, pursuant to a resolution of its Board of Directors, or the holders
of at least 10% in aggregate principal amount of the Notes then outstanding,
shall have requested the Trustee to call a meeting of Holders, by written
request setting forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have mailed the notice of such meeting
within twenty (20) days after receipt of such request, then the Company or such
Holders may determine the time and the place for such meeting and may call such
meeting to take any action authorized in Section 10.1, by mailing notice thereof
as provided in Section 10.2.
Section 10.4 Qualifications for Voting. To be entitled to vote at any
meeting of Holders a Person shall (a) be a holder of one or more Notes on the
record date pertaining to such meeting or (b) be a Person appointed by an
instrument in writing as proxy by a holder of one or more Notes. The only
Persons who shall be entitled to be present or to speak at any meeting of
Holders shall be the Persons entitled to vote at such meeting and their counsel
and any representatives of the Trustee and its counsel and any representatives
of the Company and its counsel.
Section 10.5 Regulations. Notwithstanding any other provisions of this
Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Holders, in regard to proof of the holding of Notes
and of the appointment of proxies, and in regard to the appointment and duties
of inspectors of votes, the submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall think fit.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders as provided in Section 10.3, in which case the Company or
the Holders calling the meeting, as the case may be, shall in like manner
appoint a temporary chairman. A permanent chairman and a permanent secretary of
the meeting shall be elected by vote of the holders of a majority in principal
amount of the Notes represented at the meeting and entitled to vote at the
meeting.
Subject to the provisions of Section 9.4, at any meeting each Holder or
proxyholder shall be entitled to one vote for each $1,000 principal amount of
Notes held or represented by him; provided, however, that no vote shall be cast
or counted at any meeting in respect of any Note challenged as not outstanding
and ruled by the chairman of the meeting to be not outstanding. The chairman of
the meeting shall have no right to vote other than by virtue of Notes held by
him or instruments in writing as aforesaid duly designating him as the proxy to
vote on behalf of other Holders. Any meeting of Holders duly called pursuant to
the provisions of Section 10.2 or 10.3 may be adjourned from time to time by the
holders of a majority of the aggregate principal amount of Notes represented at
the meeting, whether or not constituting a quorum, and the meeting may be held
as so adjourned without further notice.
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Section 10.6 Voting. The vote upon any resolution submitted to any
meeting of Holders shall be by written ballot on which shall be subscribed the
signatures of the holders of Notes or of their representatives by proxy and the
principal amount of the Notes held or represented by them. The permanent
chairman of the meeting shall appoint two inspectors of votes who shall count
all votes cast at the meeting for or against any resolution and who shall make
and file with the secretary of the meeting their verified written reports in
duplicate of all votes cast at the meeting. A record in duplicate of the
proceedings of each meeting of Holders shall be prepared by the secretary of the
meeting and there shall be attached to said record the original reports of the
inspectors of votes on any vote by ballot taken thereat and affidavits by one or
more Persons having knowledge of the facts setting forth a copy of the notice of
the meeting and showing that said notice was mailed as provided in Section 10.2.
The record shall show the principal amount of the Notes voting in favor of or
against any resolution. The record shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one of the
duplicates shall be delivered to the Company and the other to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
Section 10.7 No Delay of Rights by Meeting. Nothing in this Article X
contained shall be deemed or construed to authorize or permit, by reason of any
call of a meeting of Holders or any rights expressly or impliedly conferred
hereunder to make such call, any hindrance or delay in the exercise of any right
or rights conferred upon or reserved to the Trustee or to the Holders under any
of the provisions of this Indenture or of the Notes.
ARTICLE XI
SUPPLEMENTAL INDENTURES
Section 11.1 Supplemental Indentures Without Consent of Holders. Without
the consent of the Holders, the Company, when authorized by the resolutions of
the Board of Directors, and the Trustee may from time to time and at any time
enter into an indenture or indentures supplemental hereto for one or more of the
following purposes:
(a) to make provisions with respect to the conversion rights of
the holders of Notes pursuant to the requirements of Section 15.6 and
the repurchase obligations of the Company pursuant to 16.3;
(b) subject to Article IV, to convey, transfer, assign, mortgage
or pledge to the Trustee as security for the Notes, any property or
assets;
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(c) to evidence the succession of another corporation to the
Company, or successive successions, and the assumption by the successor
corporation of the covenants, agreements and obligations of the Company
pursuant to Article XII;
(d) to add to the covenants of the Company such further
covenants, restrictions or conditions as the Board of Directors and the
Trustee shall consider to be for the benefit of the holders of Notes,
and to make the occurrence, or the occurrence and continuance, of a
default in any such additional covenants, restrictions or conditions a
default or an Event of Default permitting the enforcement of all or any
of the several remedies provided in this Indenture as herein set forth;
provided, however, that in respect of any such additional covenant,
restriction or condition such supplemental indenture may provide for a
particular period of grace after default (which period may be shorter or
longer than that allowed in the case of other defaults) or may provide
for an immediate enforcement upon such default or may limit the remedies
available to the Trustee upon such default;
(e) to provide for the issuance under this Indenture of Notes in
coupon form (including Notes registrable as to principal only) and to
provide for exchange of such Notes with the Notes issued hereunder in
fully registered form and to make all appropriate changes for such
purpose;
(f) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture which may be
defective or inconsistent with any other provision contained herein or
in any supplemental indenture, or to make such other provisions in
regard to matters or questions arising under this Indenture which shall
not materially adversely affect the interests of the holders of the
Notes;
(g) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Notes;
(h) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the Trust Indenture Act, or under
any similar federal statute hereafter enacted; or
(i) to permit or facilitate the issuance of Notes in
uncertificated form.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer and assignment of any property thereunder, but the Trustee
shall not be obligated to, but may in its discretion, enter into any
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
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Any supplemental indenture authorized by the provisions of this Section
11.1 may be executed by the Company and the Trustee without the consent of the
holders of any of the Notes at the time outstanding, notwithstanding any of the
provisions of Section 11.2.
Section 11.2 Supplemental Indentures With Consent of Holders. With the
consent (evidenced as provided in Article IX) of the holders of not less than a
majority in aggregate principal amount of the Notes at the time outstanding
(determined in accordance with Section 9.4), the Company, when authorized by the
resolutions of the Board of Directors, and the Trustee may from time to time and
at any time enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to or changing in any manner or eliminating any
of the provisions of this Indenture or any supplemental indenture or of
modifying in any manner the rights of the holders of the Notes; provided,
however, that no such supplemental indenture shall (i) extend the fixed maturity
of any Note, reduce the rate or extend the time for payment of interest thereon,
reduce the principal amount thereof or premium, if any, thereon, reduce any
amount payable on redemption or repurchase thereof, impair or change in any
respect adverse to the Holders of Notes the obligation of the Company to make an
offer, to repurchase Notes, and repurchase Notes in accordance with such offer,
upon the happening of a Fundamental Change, impair or adversely affect the right
of any Holder to institute suit for the payment thereof, make the principal
thereof or interest or premium, if any, thereon payable in any coin or currency
other than that provided in the Notes, or impair or change in any respect
adverse to the Holders of the Notes the right to convert the Notes into Common
Stock subject to the terms set forth herein, including Section 15.6, or modify
the provisions of this Indenture with respect to the subordination of the Notes
in a manner adverse to the Holders, without the consent of the holder of each
Note so affected, or (ii) reduce the aforesaid percentage of Notes, the holders
of which are required to consent to any such supplemental indenture, without the
consent of the holders of all Notes then outstanding.
Upon the request of the Company, accompanied by a copy of the
resolutions of the Board of Directors certified by its Secretary or Assistant
Secretary authorizing the execution of any such supplemental indenture, and upon
the filing with the Trustee of evidence of the consent of Holders as aforesaid,
the Trustee shall join with the Company in the execution of such supplemental
indenture unless such supplemental indenture affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise, in which case the
Trustee may in its discretion, but shall not be obligated to, enter into such
supplemental indenture.
It shall not be necessary for the consent of the Holders under this
Section 11.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Section 11.3 Effect of Supplemental Indentures. Any supplemental
indenture executed pursuant to the provisions of this Article XI shall comply
with the Trust Indenture Act, as then in effect. Upon the execution of any
supplemental indenture pursuant to the provisions of this Article XI, this
Indenture shall be and be deemed to be modified and amended in accordance
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therewith and the respective rights, limitation of rights, obligations, duties
and immunities under this Indenture of the Trustee, the Company and the holders
of Notes shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.
Section 11.4 Notation on Notes. Notes authenticated and delivered after
the execution of any supplemental indenture pursuant to the provisions of this
Article XI may (but need not) bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company or the
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Trustee and the Board of Directors, to any modification of this Indenture
contained in any such supplemental indenture may (but need not), at the
Company's expense, be prepared and executed by the Company, authenticated by the
Trustee (or an authenticating agent duly appointed by the Trustee pursuant to
Section 17.11) and delivered in exchange for the Notes then outstanding, upon
surrender of such Notes then outstanding.
Section 11.5 Evidence of Compliance of Supplemental Indenture to Be
Furnished Trustee. The Trustee, subject to the provisions of Sections 8.1 and
8.2, shall be entitled to receive an Officers' Certificate and an Opinion of
Counsel as conclusive evidence that any supplemental indenture executed pursuant
hereto complies with the requirements of this Article XI.
ARTICLE XII
MERGER, SALE OR CONSOLIDATION
Section 12.1 Limitation on Merger, Sale or Consolidation.
The Company shall not consolidate with or merge into any other Person or
transfer or lease its properties and assets substantially as an entirety to any
Person, and shall not transfer and assign all its obligations of, and position
as, the Company hereunder, except for a consolidation or merger in which the
Company is the surviving party, unless:
(a) the Person formed by such consolidation or into which the
Company is merged or which acquires by conveyance, lease or transfer the
properties and assets of the Company substantially as an entirety, or to
which obligations of, and position as, the Company hereunder are
transferred and assigned (the "Successor") (i) shall be a corporation,
limited liability company, partnership or trust organized and existing
under the laws of the United States of America or any political
subdivision thereof, and (ii) shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, due and punctual payment of the
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principal of premium, of any, and interest on all of the Notes and the
performance of every covenant of this Indenture and in the Notes on the
part of the Company to be performed or observed;
(b) no default and no Event of Default shall have occurred and be
continuing as a result of such consolidation, merger, transfer or lease;
and
(c) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance or transfer, or such transfer and
assignment, and such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such
transaction have been compiled with.
Section 12.2 Successor Corporation to Be Substituted. In case of any
such consolidation, merger, sale, conveyance or lease and upon the assumption by
the Successor, by supplemental indenture, executed and delivered to the Trustee
and satisfactory in form to the Trustee, of the due and punctual payment of the
principal of and premium, if any, and interest on all of the Notes and the due
and punctual performance of all of the covenants and conditions of this
Indenture to be performed by the Company, such Successor shall succeed to and be
substituted for the Company, with the same effect as if it had been named herein
as the party of the first part. Such Successor thereupon may cause to be signed,
and may issue either in its own name or in the name of HNC Software Inc. any or
all of the Notes issuable hereunder which theretofore shall not have been signed
by the Company and delivered to the Trustee; and, upon the order of such
Successor instead of the Company and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee shall authenticate and
shall deliver, or cause to be authenticated and delivered, any Notes which
previously shall have been signed and delivered by the officers of the Company
to the Trustee for authentication, and any Notes which such successor
corporation thereafter shall cause to be signed and delivered to the Trustee for
that purpose. All the Notes so issued shall in all respects have the same legal
rank and benefit under this Indenture as the Notes theretofore or thereafter
issued in accordance with the terms of this Indenture as though all of such
Notes had been issued at the date of the execution hereof. In the event of any
such consolidation, merger, sale or conveyance (but not in the event of such
lease), the Person named as the "Company" in the first paragraph of this
Indenture, or any successor which shall thereafter have become such in the
manner prescribed in this Article XII and which shall have transferred its
rights and obligations hereunder to another successor in the manner prescribed
in this Article XII, may be dissolved, wound up and liquidated at any time
thereafter and such Person shall be released from its liabilities as obligor and
maker of the Notes and from its obligations under this Indenture.
In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form (but not in substance) may be made in the
Notes thereafter to be issued as may be appropriate.
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ARTICLE XIII
SATISFACTION AND DISCHARGE OF INDENTURE
Section 13.1 Discharge of Indenture. When (a) the Company shall deliver
to the Trustee for cancellation all Notes theretofore authenticated (other than
any Notes which have been destroyed, lost or stolen and in lieu of or in
substitution for which other Notes shall have been authenticated and delivered)
and not theretofore canceled, or (b) all the Notes not theretofore canceled or
delivered to the Trustee for cancellation shall have become due and payable, or
are by their terms to become due and payable within one year or are to be called
for redemption within one year under arrangements satisfactory to the Trustee
for the giving of notice of redemption, and the Company shall deposit with the
Trustee, in trust, funds sufficient to pay at maturity or upon redemption of all
of the outstanding Notes (other than any Notes which shall have been mutilated,
destroyed, lost or stolen and in lieu of or in substitution for which other
Notes shall have been authenticated and delivered) not theretofore canceled or
delivered to the Trustee for cancellation, including principal and premium, if
any, and interest due or to become due to such date of maturity or redemption
date, as the case may be, and if in either case the Company shall also pay or
cause to be paid all other sums payable hereunder by the Company, then this
Indenture shall cease to be of further effect (except as to (i) remaining rights
of registration of transfer, substitution and exchange and conversion of Notes,
(ii) rights hereunder of Holders to receive payments of principal of and
premium, if any, and interest on the Notes and the other rights, duties and
obligations of Holders, as beneficiaries hereof with respect to the amounts, if
any, so deposited with the Trustee and (iii) the rights, obligations and
immunities of the Trustee hereunder), and the Trustee, on demand of the Company
accompanied by an Officers' Certificate and an Opinion of Counsel as required by
Section 17.5 and at the cost and expense of the Company, shall execute proper
instruments acknowledging satisfaction of and discharging this Indenture; the
Company, however, hereby agrees to reimburse the Trustee for any costs or
expenses thereafter reasonably and properly incurred by the Trustee and to
compensate the Trustee for any services thereafter reasonably and properly
rendered by the Trustee in connection with this Indenture or the Notes.
Section 13.2 Deposited Monies to Be Held in Trust by Trustee. Subject to
Section 13.4, all monies deposited with the Trustee pursuant to Section 13.1
shall be held in trust and applied by it to the payment, notwithstanding the
provisions of Article IV, either directly or through any paying agent (including
the Company if acting as its own paying agent), to the holders of the particular
Notes for the payment or redemption of which such monies have been deposited
with the Trustee, of all sums due and to become due thereon for principal and
interest and premium, if any.
Section 13.3 Paying Agent to Repay Monies Held. Upon the satisfaction
and discharge of this Indenture, all monies then held by any paying agent of the
Notes (other than the Trustee) shall, upon demand of the Company or the Trustee,
be repaid to it or paid to the Trustee, and
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thereupon such paying agent shall be released from all further liability with
respect to such monies.
Section 13.4 Return of Unclaimed Monies. Subject to the requirements of
applicable law, any monies deposited with or paid to the Trustee for payment of
the principal of, premium, if any, or interest on Notes and not applied but
remaining unclaimed by the holders of Notes for two years after the date upon
which the principal of, premium, if any, or interest on such Notes, as the case
may be, shall have become due and payable, shall be repaid to the Company by the
Trustee on demand and all liability of the Trustee shall thereupon cease with
respect to such monies; and the holder of any of the Notes shall thereafter look
only to the Company for any payment which such holder may be entitled to collect
unless an applicable abandoned property law designates another Person.
Section 13.5 Reinstatement. If (i) the Trustee or the paying agent is
unable to apply any money in accordance with Section 13.2 by reason of any order
or judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application and (ii) the holders of at least a
majority in principal amount of the then outstanding Notes so request by written
notice to the Trustee, the Company's obligations under this Indenture and the
Notes shall be revived and reinstated as though no deposit had occurred pursuant
to Section 13.1 until such time as the Trustee or the paying agent is permitted
to apply all such money in accordance with Section 13.2; provided, however, that
if the Company makes any payment of interest or premium, if any, on or principal
of any Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the holders of such Notes to receive such payment
from the money held by the Trustee or paying agent.
ARTICLE XIV
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
Section 14.1 Indenture and Notes Solely Corporate Obligations. No
recourse for the payment of the principal of or premium, if any, or interest on
any Note, or for any claim based thereon or otherwise in respect thereof, and no
recourse under or upon any obligation, covenant or agreement of the Company in
this Indenture or in any supplemental indenture or in any Note, or because of
the creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, employee, agent, officer or director or Subsidiary,
as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise; it being expressly
understood that all such liability is hereby expressly waived and released as a
condition of, and as a consideration for, the execution of this Indenture and
the issue of the Notes.
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ARTICLE XV
CONVERSION OF NOTES
Section 15.1 Conversion Privilege and Conversion Price. Subject to and
upon compliance with the provisions of this Article XV, at the option of the
Holder thereof, the Holder of any Note is entitled at his option, at any time
prior to the close of business on March 1, 2003, subject to prior redemption or
repurchase, to convert such Note or portions thereof (in denominations of $1,000
or integral multiples thereof) into fully paid and nonassessable shares
(calculated as to each conversion to the nearest 1/100th of a share) of Common
Stock of the Company at the Conversion Price, determined as hereinafter
provided, in effect at the time of conversion. In case a Note or portion thereof
is called for redemption, such conversion right in respect of the Note or
portion called for redemption shall expire at the close of business on the
Business Day prior to the Redemption Date, unless the Company defaults in making
the payment of the Redemption Price in which case the right to convert the Note
or portion thereof shall terminate on the date such default is cured and such
Note or portion thereof is redeemed. A Note for which a Holder has delivered a
Fundamental Change repurchase notice pursuant to Section 16.2 exercising the
option of such Holder to require the Company to repurchase such Note may be
converted only if such notice is withdrawn by a written notice of withdrawal
delivered by the Holder to the Company prior to the close of business on the
Business Day preceding the Repurchase Date.
The price at which shares of Common Stock shall be delivered upon
conversion (herein called the "Conversion Price") shall be initially U.S.$_____
per share of Common Stock. The Conversion Price shall be adjusted in certain
instances as provided in this Article XV.
Section 15.2 Exercise of Conversion Privilege. To convert a Note into
shares of Common Stock, a Holder must (i) complete and manually sign the
conversion notice in the form provided on the Note (or complete and manually
sign a facsimile thereof) and deliver such notice to an office or agency
maintained by the Company for conversion of Notes pursuant to Section 5.2 (ii)
surrender the Note at such office, (iii) if required, furnish appropriate
endorsements and transfer documents, (iv) if required, pay all transfer or
similar taxes, and (v) if required, pay funds equal to interest payable on the
next interest payment date. The date on which all of the foregoing requirements
have been satisfied is the date of surrender for conversion. Each Note
surrendered for conversion (in whole or in part) during the period from the
close of business on any Regular Record Date to the close of business on the
Business Day prior to the next succeeding interest payment date (except Notes
called for redemption pursuant to a notice of redemption mailed to the Holders
in accordance with Section 3.5) shall be accompanied by payment in New York
Clearing House funds or other funds acceptable to the Company of an amount equal
to the interest payable on such interest payment date on the principal amount of
such Note (or part thereof, as the case may be) being surrendered for
conversion; provided however that no such payment need be made if there shall
exist at the time of conversion a default in the payment of interest on the
Notes. No such payment will be
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required with respect to interest payable on March 1, 2001. Except as provided
in this 15.2, no payment or other adjustment shall be made for interest accrued
on any Note converted or for dividends on any Shares issued upon conversion of
such Note as provided in this Article. The Company's delivery to the Holder of
the number of shares of Common Stock (and cash in lieu of fractions thereof, as
provided in this Indenture) into which a Note is convertible will be deemed to
satisfy the Company's obligation to pay the principal amount of the Note.
Notes shall be deemed to have been converted immediately prior to the
close of business on the day of surrender of such Notes for conversion, in
accordance with the foregoing provisions, and at such time the rights of the
Holders of such Notes as Holders shall cease, and the Person or Persons entitled
to receive the shares of Common Stock issuable upon conversion shall be treated
for all purposes as the record holder or holders of such Common Stock at such
time. As promptly as practicable on or after the conversion date, the Company
shall issue and deliver to the Trustee, for delivery to the Holder, a
certificate or certificates for the number of full shares of Common Stock
issuable upon conversion, together with payment in lieu of any fraction of a
share, as provided in Section 15.3.
In the case of any Note which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to the Holder thereof, at the expense of the Company, a new Note or
Notes of authorized denominations in an aggregate principal amount equal to the
unconverted portion of the principal amount of such Note. A Note may be
converted in part, but only if the principal amount of such Note to be converted
is any integral multiple of U.S.$1,000 and the principal amount of such security
to remain outstanding after such conversion is equal to U.S.$1,000 or any
integral multiple thereof.
Section 15.3 Fractions of Shares. No fractional shares of Common Stock
shall be issued upon conversion of any Notes. If more than one Note shall be
surrendered for conversion at one time by the same Holder, the number of full
shares which shall be issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Notes (or specified portions
thereof) so surrendered. Instead of any fractional share of Common Stock which
would otherwise be issuable upon conversion of any Notes (or specified portions
thereof), the Company shall calculate and pay a cash adjustment in respect of
such fraction (calculated to the nearest 1/100th of a share) in an amount equal
to the same fraction of the Current Market Price per share of Common Stock
(calculated in accordance with Section 15.4(8) below) at the close of business
on the last Business Day prior to the date of conversion.
Section 15.4 Adjustment of Conversion Price. The Conversion Price shall
be subject to adjustments from time to time as follows:
(1) In case the Company shall hereafter pay a dividend or
make a distribution to all holders of the outstanding Common Stock in shares of
Common Stock, the Conversion Price in effect at the opening of business on the
date following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be
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reduced by multiplying such Conversion Price by a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination and the denominator of which
shall be the sum of such number of shares and the total number of shares
constituting such dividend or other distribution, such reduction to become
effective immediately after the opening of business on the day following the
date fixed for such determination. If any dividend or distribution of the type
described in this Section 15.4 is declared but not so paid or made, the
Conversion Price shall again be adjusted to the Conversion Price which would
then be in effect if such dividend or distribution had not been declared.
(2) In case the Company shall issue rights or warrants to
all holders of its outstanding Common Stock entitling them (for a period
expiring within 45 days after the date fixed for determination of stockholders
entitled to receive such rights or warrants) to subscribe for or purchase Common
Stock at a price per share less than the Current Market Price on the date fixed
for determination of stockholders entitled to receive such rights or warrants,
the Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the date fixed for determination of shareholders entitled to receive such rights
or warrants by a fraction, the numerator of which shall be the number of shares
of Common Stock outstanding at the close of business on the date fixed for
determination of stockholders entitled to receive such rights and warrants plus
the number of shares which the aggregate offering price of the total number of
shares so offered would purchase at such Current Market Price, and the
denominator of which shall be the number of shares of Common Stock outstanding
on the date fixed for determination of stockholders entitled to receive such
rights and warrants plus the total number of additional shares of Common Stock
offered for subscription or purchase. Such adjustment shall be successively made
whenever any such rights and warrants are issued, and shall become effective
immediately after the opening of business on the day following the date fixed
for determination of stockholders entitled to receive such rights or warrants.
To the extent that shares of Common Stock are not delivered after the expiration
of such rights or warrants, the Conversion Price shall be readjusted to the
Conversion Price which would then be in effect had the adjustments made upon the
issuance of such rights or warrants been made on the basis of delivery of only
the number of shares of Common Stock actually delivered. In the event that such
rights or warrants are not so issued, the Conversion Price shall again be
adjusted to be the Conversion Price which would then be in effect if such date
fixed for the determination of stockholders entitled to receive such rights or
warrants had not been fixed. In determining whether any rights or warrants
entitle the holders to subscribe for or purchase Common Stock at less than such
Current Market Price, and in determining the aggregate offering price of such
Common Stock, there shall be taken into account any consideration received by
the Company for such rights or warrants, the value of such consideration, if
other than cash, to be determined by the Board of Directors.
(3) In case outstanding Common Stock shall be subdivided
into a greater number of shares of Common Stock, the Conversion Price in effect
at the opening of business on the day following the day upon which such
subdivision becomes effective shall be
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proportionately reduced, and conversely, in case outstanding shares of Common
Stock shall be combined into a smaller number of shares of Common Stock, the
Conversion Price in effect at the opening of business on the day following the
day upon which such combination becomes effective shall be proportionately
increased.
(4) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock shares of any class of capital
stock of the Company (other than any dividends or distributions to which Section
15.4(1) applies) or evidences of its indebtedness or assets (including
securities, but excluding any rights or warrants referred to in Section 15.4(2),
and excluding any dividend or distribution (x) paid exclusively in cash or (y)
referred to in Section 15.4(1) (any of the foregoing hereinafter in this Section
15.4(4) called the "Distribution Notes")), then, in each such case, the
Conversion Price shall be reduced so that the same shall be equal to the price
determined by multiplying the Conversion Price in effect on the Distribution
Record Date with respect to such distribution by a fraction the numerator of
which shall be the Current Market Price per share of Common Stock on such
Distribution Record Date less the fair market value (as determined by the Board
of Directors whose determination shall be conclusive and described in a
resolution of the Board of Directors) on the Distribution Record Date of the
portion of the Distribution Notes so distributed applicable to one share of
Common Stock and the denominator of which shall be the Current Market Price per
share of Common Stock, such reduction to become effective immediately prior to
the opening of business on the day following such Distribution Record Date;
provided, however, that in the event the then fair market value (as so
determined) of the portion of the Distribution Notes so distributed applicable
to one share of Common Stock is equal to or greater than the Current Market
Price per share of the Common Stock on the Distribution Record Date, in lieu of
the foregoing adjustment, adequate provision shall be made so that each Holder
shall have the right to receive upon conversion the amount of Distribution Notes
such Holder would have received had such Holder converted each Note on the
Distribution Record Date. In the event that such dividend or distribution is not
so paid or made, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such dividend or distribution
had not been declared. If the Company's Board of Directors determines the fair
market value of any distribution for purposes of this Section 15.4(4) by
reference to the actual or when issued trading market for any securities, it
must in doing so consider the prices in such market over the same period used in
computing the Current Market Price of the Common Stock.
In the event that the Company implements a stockholder rights plan, such
rights plan shall provide that upon conversion of the Notes the Holders will
receive, in addition to the Common Stock issuable upon such conversion, the
rights issued under such rights plan (notwithstanding the occurrence of an event
causing such rights to separate from the Common Stock at or prior to the time of
conversion). Any distribution of rights or warrants pursuant to a stockholder
rights plan complying with the requirements set forth in the immediately
preceding sentence of this paragraph shall not constitute a distribution of
rights or warrants for the purposes of this Section 15.4.
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Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights or warrants, until the occurrence of a specified event or events
("Trigger Event"): (i) are deemed to be transferred with such shares of Common
Stock; (ii) are not exercisable; and (iii) are also issued in respect of future
issuances of shares of Common Stock, shall be deemed not to have been
distributed for purposes of this Section 15.4 (and no adjustment to the
Conversion Price under this Section 15.4 will be required) until the occurrence
of the earliest Trigger Event, whereupon such rights and warrants shall be
deemed to have been distributed and an appropriate adjustment (if any is
required) to the Conversion Price shall be made under this Section 15.4(4). If
any such right or warrant, including any such existing rights or warrants
distributed prior to the date of this Indenture, are subject to events, upon the
occurrence of which such rights or warrants become exercisable to purchase
different securities, evidences of indebtedness or other assets, then the date
of the occurrence of any and each such event shall be deemed to be the date of
distribution and record date with respect to new rights or warrants with such
rights (and a termination or expiration of the existing rights or warrants
without exercise by any of the holders thereof). In addition, in the event of
any distribution (or deemed distribution) of rights or warrants, or any Trigger
Event or other event (of the type described in the preceding sentence) with
respect thereto that was counted for purposes of calculating a distribution
amount for which an adjustment to the Conversion Price under this Section 15.4
was made, (1) in the case of any such rights or warrants which shall all have
been redeemed or repurchased without exercise by any holders thereof, the
Conversion Price shall be readjusted upon such final redemption or repurchase to
give effect to such distribution or Trigger Event, as the case may be, as though
it were a cash distribution, equal to the per share redemption or repurchase
price received by a holder or holders of shares of Common Stock with respect to
such rights or warrants (assuming such holder had retained such rights or
warrants), made to all holders of shares of Common Stock as of the date of such
redemption or repurchase, and (2) in the case of such rights or warrants which
shall have expired or been terminated without exercise by any holders thereof,
the Conversion Price shall be readjusted as if such rights and warrants had not
been issued.
Notwithstanding the foregoing, in the event that the Company shall
distribute rights or warrants to subscribe for additional shares of the Common
Stock (other than rights or warrants described in Section 15.4(2)), pro rata to
holders of Common Stock, the Company may, in lieu of making any adjustment
pursuant to this Section 15.4(4), make proper provision so that each holder of a
Note who converts such Note (or any portion thereof) after the Distribution
Record Date for such distribution and prior to the expiration or redemption of
such rights or warrants shall be entitled to receive upon such conversion, in
addition to the shares of Common Stock issuable upon such conversion (the
"Conversion Shares"), a number of rights or warrants to be determined as
follows: (i) if such conversion occurs on or prior to the date for the
distribution to the holders of such rights or warrants of separate certificates
evidencing such rights or warrants (the "Distribution Date"), the same number of
rights or warrants to which a holder of a number of shares of Common Stock equal
to the number of Conversion Shares is entitled at the time of such conversion in
accordance with the terms and provisions of and applicable to such rights or
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warrants; and (ii) if such conversion occurs after the Distribution Date, the
same number of rights or warrants to which a holder of the number of shares of
Common Stock into which the principal amount of the Note so converted was
convertible immediately prior to the Distribution Date would have been entitled
on the Distribution Date in accordance with the terms and provisions of, and
applicable to such rights or warrants.
For purposes of this Section 15.4(4) and Sections 15.4(1) and (2), any
dividend or distribution to which this Section 15.4(4) is applicable that also
includes shares of Common Stock, or rights or warrants to subscribe for or
purchase shares of Common Stock (or both), shall be deemed instead to be (1) a
dividend or distribution of the evidences of indebtedness, assets or shares of
capital stock other than such shares of Common Stock or rights or warrants (and
any Conversion Price reduction required by this Section 15.4(4) with respect to
such dividend or distribution shall then be made) immediately followed by (2) a
dividend or distribution of such shares of Common Stock or such rights or
warrants (and any further Conversion Price reduction required by Sections
15.4(1) and (2) with respect to such dividend or distribution shall then be
made), except (A) the Distribution Record Date of such dividend or distribution
shall be substituted as "the date fixed for the determination of shareholders
entitled to receive such dividend or other distribution" and "the date fixed for
such determination" within the meaning of Sections 15.4(1) and (2) and (B) any
shares of Common Stock included in such dividend or distribution shall not be
deemed "outstanding at the close of business on the date fixed for such
determination" within the meaning of Section 15.4(1).
(5) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding (x) any quarterly
cash dividend on the Common Stock to the extent the aggregate cash dividend per
share of Common Stock in any quarterly period does not exceed the greater of (A)
the amount per share of Common Stock of the next preceding quarterly cash
dividend on the Common Stock to the extent that such preceding quarterly
dividend did not require any adjustment of the Conversion Price pursuant to this
Section 15.4(5) (as adjusted to reflect subdivisions or combinations of the
Common Stock), and (B) 3.75% of the arithmetic average of the Closing Prices
(determined as set forth in Section 15.4(8)(a)) during the ten Trading Days
immediately prior to the date of declaration of such dividend, (y) any dividend
or distribution in connection with the liquidation, dissolution or winding up of
the Company, whether voluntary or involuntary and (z) any cash that is
distributed as part of a distribution requiring a Conversion Price adjustment
pursuant to Section 15.4(4)), then, in such case, the Conversion Price shall be
reduced so that the same shall equal the price determined by multiplying the
Conversion Price in effect immediately prior to the close of business on such
Distribution Record Date by a fraction of which the numerator shall be the
Current Market Price of the Common Stock on the Distribution Record Date less
the amount of cash so distributed (and not excluded as provided above)
applicable to one share of Common Stock and the denominator shall be such
Current Market Price of the Common Stock, such reduction to be effective
immediately prior to the opening of business on the day following the
Distribution Record Date; provided, however, that in the event the portion of
the cash so distributed applicable to one share of Common Stock is equal to or
greater than the Current
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Market Price of the Common Stock on the Distribution Record Date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each Holder shall
have the right to receive upon conversion the amount of cash such Holder would
have received had such Holder converted each Note on the Distribution Record
Date. In the event that such dividend or distribution is not so paid or made,
the Conversion Price shall again be adjusted to be the Conversion Price which
would then be in effect if such dividend or distribution had not been declared.
If any adjustment is required to be made as set forth in this Section 15.4(5) as
a result of a distribution that is a quarterly dividend, such adjustment shall
be based upon the amount by which such distribution exceeds the amount of the
quarterly cash dividend permitted to be excluded pursuant hereto. If an
adjustment is required to be made as set forth in this Section 15.4(5) above as
a result of a distribution that is not a quarterly dividend, such adjustment
shall be based upon the full amount of the distribution.
(6) In case a tender or exchange offer made by the Company
for all or any portion of the Common Stock shall expire and such tender or
exchange offer (as amended upon the expiration thereof) shall require the
payment to stockholders of consideration per share of Common Stock having a fair
market value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) that as of the last time (the
"Expiration Time") tenders or exchanges may be made pursuant to such tender or
exchange offer (as it may be amended) that exceeds the Current Market Price per
share of the Common Stock on the Trading Day next succeeding the Expiration
Time, the Conversion Price shall be reduced so that the same shall equal the
price determined by multiplying the Conversion Price in effect immediately prior
to the Expiration Time by a fraction of which the numerator shall be the number
of shares of Common Stock outstanding (including any tendered or exchanged
shares) on the Expiration Time multiplied by the Current Market Price of the
Common Stock on the Trading Day next succeeding the Expiration Time and the
denominator shall be the sum of (x) the fair market value (determined as
aforesaid) of the aggregate consideration payable to stockholders based on the
acceptance (up to any maximum specified in the terms of the tender or exchange
offer) of all shares validly tendered or exchanged and not withdrawn as of the
Expiration Time (the shares deemed so accepted, up to any such maximum, being
referred to as the "Purchased Shares") and (y) the product of the number of
shares of Common Stock outstanding (less any Purchased Shares) on the Expiration
Time and the Current Market Price of the Common Stock on the Trading Day next
succeeding the Expiration Time, such reduction to become effective immediately
prior to the opening of business on the day following the Expiration Time. In
the event that the Company is obligated to purchase shares pursuant to any such
tender or exchange offer, but the Company is permanently prevented by applicable
law from effecting any such purchases or all such purchases are rescinded, the
Conversion Price shall again be adjusted to be the Conversion Price which would
then be in effect if such tender or exchange offer had not been made.
(7) In case of a tender or exchange offer made by a Person
other than the Company for an amount which increases the offeror's ownership of
Common Stock to more than 25% of the total shares of the Common Stock
outstanding and which provides for the
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payment by such Person of cash and other consideration per share of Common Stock
having a fair market value (as determined by the Board of Directors, whose
determination shall be conclusive, and described in a resolution of the Board)
at the last time (the "Tender Expiration Time") tenders or exchanges may be made
pursuant to such tender or exchange offer (as it shall have been amended) that
exceeds the Current Market Price of the Common Stock on the Trading Day next
succeeding the Tender Expiration Time, and in which, as of the Tender Expiration
Time the Board of Directors is not recommending rejection of the offer, the
Conversion Price shall be reduced so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the Tender Expiration Time by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding (including any tendered or
exchanged shares) on the Tender Expiration Time multiplied by the Current Market
Price of the Common Stock on the Trading Day next succeeding the Tender
Expiration Time and the denominator shall be the sum of (x) the fair market
value (determined as aforesaid) of the aggregate consideration payable to
stockholders based on the acceptance (up to any maximum specified in the terms
of the tender or exchange offer) of all shares validly tendered or exchanged and
not withdrawn as of the Tender Expiration Time (the shares deemed so accepted,
up to any such maximum, being referred to as the "Accepted Purchased Shares")
and (y) the product of the number of shares of Common Stock outstanding (less
any Accepted Purchased Shares) on the Tender Expiration Time and the Current
Market Price of the Common Stock on the Trading Day next succeeding the Tender
Expiration Time, such reduction to become effective immediately prior to the
opening of business on the day following the Tender Expiration Time. In the
event that such Person is obligated to purchase shares pursuant to any such
tender or exchange offer, but such Person is permanently prevented by applicable
law from effecting any such purchases or all such purchases are rescinded, the
Conversion Price shall again be adjusted to be the Conversion Price which would
then be in effect if such tender or exchange offer had not been made.
Notwithstanding the foregoing, the adjustment described in this Section 15.4(7)
shall not be made if, as of the Tender Expiration Time, the offering documents
with respect to such offer disclose a plan or intention to cause the Company to
engage in a consolidation or merger of the Company or a sale of all or
substantially all of the Company's assets.
(8) For purposes of this Section 15.4, the following terms
shall have the meaning indicated:
(a) "Closing Price" with respect to any securities on any day
shall mean the closing sale price regular way on such day or, in case no
such sale takes place on such day, the average of the reported closing
bid and asked prices, regular way, in each case on the New York Stock
Exchange, or, if such security is not listed or admitted to trading on
such Exchange, on the principal security exchange or quotation system in
the United States on which such security is quoted or listed or admitted
to trading, or, the average of the closing bid and asked prices of such
security on the over-the-counter market on the day in question as
reported by the Nasdaq National Market or a similar generally accepted
reporting service, or if not so available, in such manner as furnished
by any New York Stock Exchange member firm selected from time to time by
the Board of Directors
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for that purpose, or a price determined in good faith by the Board of
Directors or, to the extent permitted by applicable law, a duly
authorized committee thereof, whose determination shall be conclusive.
(b) "Current Market Price" shall mean the average of the daily
Closing Prices per share of Common Stock for the ten consecutive Trading
Days immediately prior to the date in question; provided, however, that
(1) if the "ex" date (as hereinafter defined) for any event (other than
the issuance or distribution or Fundamental Change requiring such
computation) that requires an adjustment to the Conversion Price
pursuant to Section 15.4(1), (2), (3), (4), (5), (6) or (7) occurs
during such ten consecutive Trading Days, the Closing Price for each
Trading Day prior to the "ex" date for such other event shall be
adjusted by multiplying such Closing Price by the same fraction by which
the Conversion Price is so required to be adjusted as a result of such
other event, (2) if the "ex" date for any event (other than the
issuance, distribution or Fundamental Change requiring such computation)
that requires an adjustment to the Conversion Price pursuant to Section
15.4(1), (2), (3), (4), (5), (6) or (7) occurs on or after the "ex" date
for the issuance or distribution requiring such computation and prior to
the day in question, the Closing Price for each Trading Day on and after
the "ex" date for such other event shall be adjusted by multiplying such
Closing Price by the reciprocal of the fraction by which the Conversion
Price is so required to be adjusted as a result of such other event, and
(3) if the "ex" date for the issuance, distribution or Fundamental
Change requiring such computation is prior to the day in question, after
taking into account any adjustment required pursuant to clause (1) or
(2) of this proviso, the Closing Price for each Trading Day on or after
such "ex" date shall be adjusted by adding thereto the amount of any
cash and the fair market value (as determined by the Board of Directors
in a manner consistent with any determination of such value for purposes
of Section 15.4(4), (6) or (7), whose determination shall be conclusive
and described in a resolution of the Board of Directors) of the
evidences of indebtedness, shares of capital stock or assets being
distributed applicable to one share of Common Stock as of the close of
business on the day before such "ex" date. For purposes of any
computation under Section 15.4(6) or (7), the Current Market Price of
the Common Stock on any date shall be deemed to be the average of the
daily Closing Prices per share of Common Stock for such day and the next
two succeeding Trading Days; provided, however, that if the "ex" date
for any event (other than the tender or exchange offer requiring such
computation) that requires an adjustment to the Conversion Price
pursuant to Section 15.4(1), (2), (3), (4), (5), (6) or (7) occurs on or
after the Expiration Time or Tender Expiration Time, as the case may be,
for the tender or exchange offer requiring such computation and prior to
the day in question, the Closing Price for each Trading Day on and after
the "ex" date for such other event shall be adjusted by multiplying such
Closing Price by the reciprocal of the fraction by which the Conversion
Price is so required to be adjusted as a result of such other event. For
purposes of this paragraph, the term "ex" date, (1) when used with
respect to any issuance or distribution, means the first date on which
the Common Stock trades regular way on the relevant exchange or in the
relevant market from which the Closing Price was
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obtained without the right to receive such issuance or distribution, (2)
when used with respect to any subdivision or combination of shares of
Common Stock, means the first date on which the Common Stock trades
regular way on such exchange or in such market after the time at which
such subdivision or combination becomes effective, and (3) when used
with respect to any tender or exchange offer means the first date on
which the Common Stock trades regular way on such exchange or in such
market after the Expiration Time or Tender Expiration Time, as the case
may be, of such offer.
(c) "fair market value" shall mean the amount which a willing
buyer would pay a willing seller in an arm's length transaction.
(d) "Distribution Record Date" shall mean, with respect to any
dividend, distribution or other transaction or event in which the
holders of Common Stock have the right to receive any cash, securities
or other property or in which the Common Stock (or other applicable
security) is exchanged for or converted into any combination of cash,
securities or other property, the date fixed for determination of
stockholders entitled to receive such cash, securities or other property
(whether such date is fixed by the Board of Directors or by statute,
contract or otherwise).
(e) "Trading Day" shall mean (x) if the applicable security is
listed or admitted for trading on the New York Stock Exchange or another
national security exchange, a day on which the New York Stock Exchange
or another national security exchange is open for business or (y) if the
applicable security is quoted on the Nasdaq National Market, a day on
which trades may be made on thereon or (z) if the applicable security is
not so listed, admitted for trading or quoted, any day other than a
Saturday or Sunday or a day on which banking institutions in the State
of New York are authorized or obligated by law or executive order to
close.
(9) No adjustment in the Conversion Price shall be
required unless such adjustment (plus any adjustments not previously made by
reason of this paragraph (9)) would require an increase or decrease of at least
one percent in such price; provided, however, that any adjustments which by
reason of this paragraph (9) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article shall be made to the nearest cent or to the nearest
one-hundredth of a share, as the case may be.
(10) The Company may, at its option, make such reductions
in the Conversion Price as the Board deems advisable, in addition to those
required by paragraphs (1), (2), (3), (4), (5), (6) or (7) of this Section 15.4
in order to avoid or diminish any income tax to any holders of Common Stock or
rights to purchase Common Stock resulting from any dividend or distribution on
Common Stock (or rights to acquire such shares) or from any event treated as
such for income tax purposes, resulting from any dividend or distribution of
shares or issuance of
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rights or warrants to purchase or subscribe for shares or from any event treated
as such for income tax purposes.
To the extent permitted by applicable law, the Company from time to time
may reduce the Conversion Price by any amount for any period of time if the
period is (i) at least twenty (20) days, (ii) the reduction is irrevocable
during the period and (iii) the Board shall have made a determination that such
reduction would be in the best interests of the Company, which determination
shall be conclusive. Whenever the Conversion Price is reduced pursuant to the
preceding sentence, the Company shall give notice of the reduction to the
Holders of Notes at least fifteen (15) days prior to the date the reduced
Conversion Price takes effect, and such notice shall state the reduced
Conversion Price and the period during which it will be in effect.
(11) No adjustment of the Conversion Price will result in
zero or a negative number.
Section 15.5 Notice of Adjustments of Conversion Price. Whenever the
Conversion Price is adjusted as herein provided:
(1) the Company shall compute the adjusted Conversion
Price in accordance with Section 15.4 and shall prepare a
certificate signed by the President, Treasurer or Chief Financial
Officer of the Company setting forth the adjusted Conversion
Price and showing in reasonable detail the facts upon which such
adjustment is based, and such certificate shall promptly be filed
with the Trustee; and
(2) a notice stating that the Conversion Price has been
adjusted and setting forth the adjusted Conversion Price shall
promptly be prepared and as soon as practicable thereafter, such
notice shall be provided by the Company to all Holders.
The Trustee shall not be under any duty or responsibility with respect to any
such certificate or the information and calculations contained therein, except
to exhibit the same to any Holder of Notes desiring inspection thereof at its
office during normal business hours.
Section 15.6 Notice of Certain Corporate Action. In case:
(a) the Company shall declare a dividend (or any other
distribution) on all or substantially all of its Common Stock payable
(i) otherwise than exclusively in cash or (ii) exclusively in cash in an
amount that would require any adjustment pursuant to Section 15.4; or
(b) the Company shall authorize the granting to the holders of
its Common Stock of rights, options or warrants to subscribe for or
purchase any shares of capital
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stock of any class or of any other rights that would require any
adjustment pursuant to Section 15.4; or
(c) of any reclassification of the Common Stock of the Company
(other than a subdivision or combination of its outstanding Common
Stock), or of any consolidation or merger to which the Company is a
party and for which approval of any stockholders of the Company is
required, or of the sale or transfer of all or substantially all of the
assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(e) the Company or any Subsidiary of the Company shall commence a
tender offer for all or a portion of the Company's outstanding Common
Stock (or shall amend any such tender offer);
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Notes pursuant to Section 5.2, and shall cause to
be provided to all Holders, at least 20 days (or 10 days in any case specified
in clause (a) or (b) above) prior to the applicable record, expiration or
effective date hereinafter specified, a notice stating (x) the date on which a
record is to be taken for the purpose of such dividend, distribution, rights,
options or warrants, or, if a record is not to be taken, the date as of which
the holders of Common Stock of record to be entitled to such dividend,
distribution, rights, options or warrants are to be determined, (y) the date on
which the right to make tenders under such tender offer expires or (z) the date
on which such reclassification, consolidation, merger, share exchange,
conveyance, transfer, sale, dissolution, liquidation or winding up is expected
to become effective, and the date as of which it is expected that holders of
shares of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, share exchange, conveyance, transfer,
sale, lease, dissolution, liquidation or winding up. If at the time the Trustee
shall not be the conversion agent, a copy of such notice and any notice referred
to in the following paragraph shall also forthwith be filed by the Company with
the Trustee.
The preceding paragraph to the contrary notwithstanding, the Company
shall cause to be filed at each office or agency maintained for the purpose of
conversion of Notes pursuant to Section 5.2, and shall cause to be provided to
all Holders, notice of any tender offer by the Company or any Subsidiary of the
Company for all or any portion of the Common Stock at or about the time that
such notice of tender offer is provided to the public generally (such notice to
be sent to all Holders within five days after receipt of such notice by the
Trustee from the Company).
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Section 15.7 Company to Provide Common Stock. The Company shall ensure
that the Company has, free from preemptive rights, out of its authorized but
unissued Common Stock, the full number of shares of Common Stock for the purpose
of effecting the conversion of Notes.
Section 15.8 Taxes on Conversions. The Company will pay any and all
taxes and duties that may be payable in respect of the issue or delivery of
Common Stock on conversion of Notes pursuant hereto. The Company shall not,
however, be required to pay any tax or duty which may be payable in respect of
any transfer involved in the issue and delivery of Common Stock in a name other
than that of the Holder of the Note or Notes to be converted, and no such issue
or delivery shall be made unless and until the Person requesting such issue has
paid to the Company the amount of any such tax or duty, or has established to
the satisfaction of the Company that such tax or duty has been paid.
Section 15.9 Company Covenants as to Common Stock. The Company covenants
that all Common Stock which may be delivered upon conversion of Notes, upon such
delivery, will have been duly authorized and validly issued and will be fully
paid and nonassessable and, except as provided in Section 15.8, the Company will
pay all taxes, liens and charges with respect to the issue thereof.
Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value, if any, of the shares of Common Stock
issuable upon conversion of the Notes, the Company will take all corporate
action which may, in the opinion of its counsel, be necessary in order that the
Company may validly and legally issue shares of such Common Stock at such
adjusted Conversion Price.
The Company covenants that if any shares of Common Stock to be provided
for the purpose of conversion of Notes hereunder require registration with or
approval of any governmental authority under any federal or state law before
such shares may be validly issued upon conversion, the Company will in good
faith and as expeditiously as possible endeavor to secure such registration or
approval, as the case may be.
The Company further covenants that if at any time the Common Stock shall
be listed on the Nasdaq National Market or any other national securities
exchange or automated quotation system the Company will, if permitted by the
rules of such exchange or automated quotation system, list and keep listed, so
long as the Common Stock shall be so listed on such exchange or automated
quotation systems, all Common Stock issuable upon conversion of the Notes;
provided, however, that if rules of such exchange or automated quotation system
permit the Company to defer the listing of such Common Stock until the first
conversion of the Notes into Common Stock in accordance with the provisions of
this Indenture, the Company covenants to list such Common Stock issuable upon
conversion of the Notes in accordance with the requirements of such exchange or
automated quotation system at such time.
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Section 15.10 Cancellation of Converted Notes. All Notes delivered for
conversion shall be delivered to the Trustee which shall dispose of the same as
provided in Section 2.8.
Section 15.11 Effect of Reclassification, Consolidation, Merger or Sale.
If any of the following events occur, namely (i) any reclassification of Common
Stock (other than a subdivision or combination to which Section 15.4(3)
applies), (ii) any consolidation, merger or combination of the Company with
another corporation as a result of which holders of Common Stock shall be
entitled to receive stock, securities or other property or assets (including
cash) with respect to or in exchange for such Common Stock, or (iii) any sale or
conveyance of the properties and assets of the Company as, or substantially as,
an entirety to any other corporation as a result of which holders of Common
Stock shall be entitled to receive stock, other securities or other property or
assets (including cash) with respect to or in exchange for such Common Stock,
then the Company or the successor or purchasing corporation, as the case may be,
shall execute with the Trustee a supplemental indenture (which shall comply with
the Trust Indenture Act as in force at the date of execution of such
supplemental indenture) providing that such Note shall be convertible into the
kind and amount of shares of stock and other securities or property or assets
(including cash) that the holder of such Note would have owned or been entitled
to receive upon such reclassification, change, consolidation, merger,
combination, sale or conveyance by a holder of a number of shares of Common
Stock issuable upon conversion of such Notes (assuming, for such purposes, a
sufficient number of authorized shares of Common Stock available to convert all
such Notes) immediately prior to such reclassification, change, consolidation,
merger, combination, sale or conveyance assuming such holder of Common Stock is
(i) not a Person with which the Company consolidated or into which the Company
merged or which merged into the Company or to which such sale or transfer was
made, as the case may be (a "Constituent Person"), or an Affiliate of a
Constituent Person, and (ii) failed to exercise his rights of election, if any,
as to the kind or amount of securities, cash or other property receivable upon
such reclassification, change, consolidation, merger, combination, sale or
conveyance (provided that, if the kind or amount of securities, cash or other
property receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance is not the same for each share of Common Stock
in respect of which such rights of election shall not have been exercised
("Non-electing Share")), then for the purposes of this Section 15.11 the kind
and amount of securities, cash or other property receivable upon such
reclassification, change, consolidation, merger, combination, sale or conveyance
for each Non-electing Share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares. Such
supplemental indenture shall provide for adjustments which, for events
subsequent to the effective date of such supplemental indenture, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Article. The above provisions of this Section 12.11 shall similarly apply to
successive reclassifications, changes, consolidations, mergers, combinations,
sales or conveyances. Notice of the execution of such a supplemental indenture
shall be given by the Company to the Holder of each Note as provided in Section
1.6 promptly upon such execution.
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Neither the Trustee, any paying agent nor any conversion agent shall be
under any responsibility to determine the correctness of any provisions
contained in any such supplemental indenture relating either to the kind or
amount of shares of stock or other securities or property or cash receivable by
Holders of Notes upon the conversion of their Notes after any such
reclassification, change, consolidation, merger, combination, sale or conveyance
or to any such adjustment, but may accept as conclusive evidence of the
correctness of any such provisions, and shall be protected in relying upon, an
Opinion of Counsel with respect thereto, which the Company shall cause to be
furnished to the Trustee.
Section 15.12 Responsibility of Trustee for Conversion Provisions. The
Trustee, subject to the provisions of Section 8.1, shall not at any time be
under any duty or responsibility to any Holder of Notes to determine whether any
facts exist which may require any adjustment of the Conversion Price, or with
respect to the nature or extent of any such adjustment when made, or with
respect to the method employed, or herein or in any supplemental indenture
provided to be employed, in making the same, or whether a supplemental indenture
need be entered into. The Trustee, subject to the provisions of Section 8.1,
shall not be accountable with respect to the validity or value (or the kind or
amount) of any Common Stock, or of any other securities or property or cash,
which may at any time be issued or delivered upon the conversion of any Note;
and it or they do not make any representation with respect thereto. The Trustee,
subject to the provisions of Section 8.1, shall not be responsible for any
failure of the Company to make or calculate any cash payment or to issue,
transfer or deliver any Common Stock or share certificates or other securities
or property or cash upon the surrender of any Note for the purpose of
conversion; and the Trustee, subject to the provisions of Section 8.1, shall not
be responsible for any failure of the Company to comply with any of the
covenants of the Company contained in this Article. Unless and until a
Responsible Officer of the Trustee shall have received a notice of an adjustment
of the Conversion Price delivered pursuant to Section 15.5, the Trustee shall
not be deemed to have knowledge of any such adjustment and may assume without
inquiry that the last Conversion Price of which it has knowledge remains in
effect.
ARTICLE XVI
REPURCHASE UPON A FUNDAMENTAL CHANGE
Section 16.1 Right to Require Repurchase. In the event that a
Fundamental Change (as hereinafter defined) shall occur, then each Holder shall
have the right, at the Holder's option, to require the Company to repurchase,
and upon the exercise of such right the Company shall repurchase, all of such
Holder's Notes, or any portion of the principal amount thereof that is equal to
U.S.$1,000 or any integral multiple thereof (provided that no single Note may be
repurchased in part unless the portion of the principal amount of such Note to
be Outstanding after such repurchase is equal to U.S.$1,000 or integral
multiples of U.S.$1,000 in excess thereof), on the date (the "Repurchase Date")
that is 45 days after the date of the Company
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Notice (as defined in Section 16.2) at the following prices (expressed as
percentages of the principal amount thereof) (the "Repurchase Price") in the
event of a Fundamental Change occurring during the 12-month period beginning
March 1 of the years set forth below (plus interest accrued to, but excluding,
the Repurchase Date):
Year Repurchase Price
---- ----------------
1998 %
1999
2000
and thereafter at the Redemption Price that would then be applicable as set
forth on the reverse of the form of Note for the years therein indicated,
attached hereto as Exhibit A; provided that if the Applicable Price with respect
to the Fundamental Change is less than the Reference Market Price, the Company
shall repurchase such Notes at a price equal to the foregoing Repurchase Price
multiplied by the fraction obtained by dividing the Applicable Price by the
Reference Market Price; and provided, further, that if the Repurchase Date is
March 1 or September 1, then the interest payable on the Repurchase Date shall
be paid to the holder or record of the Note on the immediately preceding Record
Date. Such right to require the repurchase of the Notes shall not continue after
a discharge of the Company from its obligations with respect to the Notes in
accordance with Article XIII, unless a Fundamental Change shall have occurred
prior to such discharge. Whenever in this Indenture there is a reference, in any
context, to the principal of any Note as of any time, such reference shall be
deemed to include reference to the Repurchase Price payable in respect of such
Note to the extent that such Repurchase Price is, was or would be so payable at
such time, and express mention of the Repurchase Price in any provision of this
Indenture shall not be construed as excluding the Repurchase Price in those
provisions of this Indenture when such express mention is not made.
Section 16.2 Notices; Method of Exercising Repurchase Right, Etc.
(a) Unless the Company shall have theretofore called for
redemption all of the outstanding Notes, on or before the 30th day after the
occurrence of a Fundamental Change, the Company or, at the request and expense
of the Company, the Trustee, shall give to all Holders of Notes, notice (the
"Company Notice") of the occurrence of the Fundamental Change and of the
repurchase right set forth herein arising as a result thereof. The Company shall
also deliver a copy of such notice of a repurchase right to the Trustee.
Each notice of a repurchase right shall state:
(1) the Repurchase Date,
(2) the date by which the repurchase right must be
exercised,
(3) the Repurchase Price,
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(4) a description of the procedure which a Holder must
follow to exercise a repurchase right, and the place or places where such Notes
are to be surrendered for payment of the Repurchase Price and accrued interest,
if any,
(5) that on the Repurchase Date the Repurchase Price, and
accrued interest, if any, will become due and payable upon each such Note
designated by the Holder to be repurchased, and that interest thereon shall
cease to accrue on and after said date, and
(6) the Conversion Price then in effect, the date on which
the right to convert the principal amount of the Notes to be repurchased will
terminate and the place or places where such Notes may be surrendered for
conversion.
If any of the foregoing provisions or other provisions of this Article
are inconsistent with applicable law, such law shall govern.
(b) To exercise a repurchase right, a Holder shall deliver to the
Trustee or any paying agent on or before the 30th day after the date of the
Company Notice (i) written notice of the Holder's exercise of such right, which
notice shall set forth the name of the Holder, the principal amount of the Notes
to be repurchased (and, if any Note is to be repurchased in part, the serial
number thereof, the portion of the principal amount thereof to be repurchased
and the name of the Person in which the portion thereof to remain outstanding
after such repurchase is to be registered) and a statement that an election to
exercise the repurchase right is being made thereby, and (ii) the Notes with
respect to which the repurchase right is being exercised. Such written notice
shall be irrevocable, except that the right of the Holder to convert the Notes
with respect to which the repurchase right is being exercised shall continue
until the close of business on the Business Day prior to the Repurchase Date as
set forth in the immediate succeeding sentence. A Note for which a Holder has
delivered a repurchase notice exercising the option of such Holder to require
the Company to repurchase such Note may be converted only if such notice is
withdrawn by a written notice of withdrawal delivered by the Holder to the
Company prior to the close of business on the Business Day preceding the
Repurchase Date.
(c) In the event a repurchase right shall be exercised in
accordance with the terms hereof, the Company shall pay or cause to be paid to
the Trustee or the paying agent the Repurchase Price in cash, as provided above,
for payment to the Holder on the Repurchase Date together with accrued and
unpaid interest to (but excluding) the Repurchase Date payable with respect to
the Notes as to which their purchase right has been exercised; provided,
however, that installments of interest that mature on to the Repurchase Date
shall be payable in cash, in the case of Notes, to the Holders of such Notes, or
one or more Predecessor Notes, registered as such at the close of business on
the relevant Regular Record Date.
(d) If any Note (or portion thereof) surrendered for repurchase
shall not be so paid on the Repurchase Date, the principal amount of such Note
(or portion thereof, as the case may be) shall, until paid, bear interest to the
extent permitted by applicable law from the
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Xxxxxxxxxx Date at the rate of _____% per annum, and each Note shall remain
convertible into Common Stock until the principal of such Note (or portion
thereof, as the case may be) shall have been paid or duly provided for.
(e) Any Note which is to be repurchased only in part shall be
surrendered to the Trustee (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and make available for delivery to the Holder of such Note
without service charge, a new Note or Notes, containing identical terms and
conditions, each in an authorized denomination in aggregate principal amount
equal to and in exchange for the unrepurchased portion of the principal of the
Note so surrendered.
(f) All securities delivered for repurchase shall be delivered to
the Trustee, the paying agent or any other agents (as shall be set forth in the
Company Notice) to be canceled by or at the direction of the Trustee, which
shall dispose of the same as provided in Section 2.8.
Section 16.3 Merger, Consolidation, etc. In the case of any merger,
consolidation, sale or transfer of all or substantially all of the assets of the
Company to which Section 15.11 applies, in which the Common Stock of the Company
is changed or exchanged as a result into the right to receive shares of stock
and other securities or property or assets (including cash) which includes
Common Stock of the Company or common stock of another Person that are, or upon
issuance will be, traded on a United States national securities exchange or
approved for trading on an established automated over-the-counter trading market
in the United States and such shares constitute at the time such change or
exchange becomes effective in excess of 50% of the aggregate fair market value
of such shares of stock and other securities, property and assets (including
cash) (as determined by the Company, which determination shall be conclusive and
binding), then the Company and the Person resulting from such merger or
consolidation or which acquires the properties or assets (including cash) of the
Company, as the case may be, shall execute and deliver to the Trustee a
supplemental indenture (which shall comply with the Trust Indenture Act as in
force at the date of execution of such supplemental indenture) modifying the
provisions of this Indenture relating to the right of Holders to cause the
Company to repurchase the Notes following a Fundamental Change, including,
without limitation, the applicable provisions of this Article XVI and the
definitions of the Common Stock and Fundamental Change, as appropriate, and such
other related definitions set forth herein, as determined in good faith by the
Company (which determination shall be conclusive and binding), to make such
provisions apply in the event of a subsequent Fundamental Change to the common
stock and the issuer thereof if different from the Company and the Common Stock
of the Company (in lieu of the Company and Common Stock of the Company).
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ARTICLE XVII
MISCELLANEOUS PROVISIONS
Section 17.1 Provisions Binding on Company's Successors. All the
covenants, stipulations, promises and agreements of the Company in this
Indenture contained shall bind its successors and assigns whether so expressed
or not.
Section 17.2 Official Acts by Successor Corporation. Any act or
proceeding by any provision of this Indenture authorized or required to be done
or performed by any board, committee or officer of the Company shall and may be
done and performed with like force and effect by the like board, committee or
officer of any corporation that shall at the time be the lawful sole successor
of the Company.
Section 17.3 Addresses for Notices, Etc. Any notice or demand which by
any provision of this Indenture is required or permitted to be given or served
by the Trustee or by the holders of Notes on the Company shall be deemed to have
been sufficiently given or made, for all purposes if given or served by being
sent by overnight courier, or deposited postage prepaid by registered or
certified mail in a post office letter box addressed (until another address is
filed by the Company with the Trustee) to HNC Software Inc., 0000 Xxxxxxxxxxx
Xxxxx Xxxx, Xxx Xxxxx, Xxxxxxxxxx, 00000, Attention: Xxxxxxx X. Xxxxxx. Any
notice, direction, request or demand hereunder to or upon the Trustee shall be
deemed to have been sufficiently given or made, for all purposes, if given or
served by being sent by overnight courier, or deposited postage prepaid by
registered or certified mail in a post office letter box addressed to the
Corporate Trust Office of the Trustee, which office is, at the date as of which
this Indenture is dated, located at 000 Xxxx 0xx Xxxxxx, 00xx Xxxxx, Xxx
Xxxxxxx, Xxxxxxxxxx 00000, Attention: Corporate Trust Division (HNC Software
Inc. __% Convertible Subordinated Notes due 2003).
The Trustee, by notice to the Company, may designate additional or
different addresses for subsequent notices or communications.
Any notice or communication mailed to a Holder shall be mailed to him by
first class mail, postage prepaid, at his address as it appears on the Note
register and shall be sufficiently given to him if so mailed within the time
prescribed.
In any case where notice to Holders of Notes is given by mail, neither
the failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder of a Note shall affect the sufficiency of such notice with
respect to other Holders of Notes given as provided above. In case by reason of
the suspension of or irregularities in regular mail service or by reason of any
other cause it shall be impracticable to give such notice by mail, then such
notification to Holders of Notes as shall be made with the approval of the
Trustee, which approval shall not be unreasonably withheld, shall constitute a
sufficient notification to such Holders for every purpose hereunder.
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Where this Indenture provides for notice in any manner, such notice may
be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders of Notes shall be filed with the Trustee,
but such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
Section 17.4 Governing Law. The laws of the State of New York shall
govern this Indenture and the Notes, without regard to the principles of
conflicts of laws.
Section 17.5 Evidence of Compliance with Conditions Precedent;
Certificates to Trustee. Upon any application or demand by the Company to the
Trustee to take any action under any of the provisions of this Indenture, the
Company shall furnish to the Trustee an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with, and an Opinion of Counsel, stating
that, in the opinion of such counsel, all such conditions precedent have been
complied with.
Each certificate or opinion provided for in this Indenture and delivered
to the Trustee with respect to compliance with a condition or covenant provided
for in this Indenture shall include (1) a statement that the Person making such
certificate or opinion has read such covenant or condition; (2) a brief
statement as to the nature and scope of the examination or investigation upon
which the statement or opinion contained in such certificate or opinion is
based; (3) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and (4) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with.
Section 17.6 Legal Holidays. In any case where the date of maturity of
interest on or principal of the Notes or the date fixed for redemption or
repurchase of any Note will not be a Business Day, then payment of such interest
on or principal of the Notes need not be made on such date, but may be made on
the next succeeding Business Day with the same force and effect as if made on
the date of maturity or the date fixed for redemption or repurchase, and no
interest shall accrue for the period from and after such date.
Section 17.7 No Note Interest Created. Nothing in this Indenture or in
the Notes, expressed or implied, shall be construed to constitute a security
interest under the Uniform Commercial Code or similar legislation, as now or
hereafter enacted and in effect, in any jurisdiction.
Section 17.8 Trust Indenture Act. If and to the extent that any
provision of this Indenture limits, qualifies or conflicts with another
provision included in this Indenture which is required to be included in this
Indenture by any of Section 310 to 317, inclusive, of the Trust Indenture Act,
such required provision shall control. If any provision of this Indenture
modifies or excludes any provision of the Trust Indenture Act that may be so
modified or excluded, the
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latter provision shall be deemed to apply to this Indenture as so modified or
excluded, as the case may be.
Section 17.9 Benefits of Indenture. Nothing in this Indenture or in the
Notes, expressed or implied, shall give to any Person, other than the parties
hereto, any paying agent, any authenticating agent, any Note registrar, any
conversion agent and their successors hereunder, the holders of Notes and the
holders of Senior Indebtedness, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
Section 17.10 Table of Contents, Headings, Etc. The table of contents
and the titles and headings of the articles and sections of this Indenture have
been inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions
hereof.
Section 17.11 Authenticating Agent. The Trustee may appoint an
authenticating agent which shall be authorized to act on its behalf and subject
to its direction in the authentication and delivery of Notes in connection with
the original issuance thereof and transfers and exchanges of Notes hereunder,
including under Sections 2.4, 2.5, 2.6, 2.7, 3.7, 15.2 and 16.2 as fully to all
intents and purposes as though the authenticating agent had been expressly
authorized by this Indenture and those Sections to authenticate and deliver
Notes. For all purposes of this Indenture, the authentication and delivery of
Notes by the authenticating agent shall be deemed to be authentication and
delivery of such Notes "by the Trustee" and a certificate of authentication
executed on behalf of the Trustee by an authenticating agent shall be deemed to
satisfy any requirement hereunder or in the Notes for the Trustee's certificate
of authentication. Such authenticating agent shall at all times be a Person
eligible to serve as trustee hereunder pursuant to Section 8.9.
Any corporation into which any authenticating agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any authenticating agent
shall be a party, or any corporation succeeding to the corporate trust business
of any authenticating agent, shall be the successor of the authenticating agent
hereunder, if such successor corporation is otherwise eligible under this
Section, without the execution or filing of any paper or any further act on the
part of the parties hereto or the authenticating agent or such successor
corporation.
Any authenticating agent may at any time resign by giving written notice
of resignation to the Trustee and to the Company. The Trustee may at any time
terminate the agency of any authenticating agent by giving written notice of
termination to such authenticating agent and to the Company. Upon receiving such
a notice of resignation or upon such a termination, or in case at any time any
authenticating agent shall cease to be eligible under this Section, the Trustee
shall promptly appoint a successor authenticating agent (which may be the
Trustee), shall give written notice of such appointment to the Company and shall
mail notice of such appointment to all holders of Notes as the names and
addresses of such holders appear on the Note register.
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The Trustee agrees to pay to the authenticating agent from time to time
reasonable compensation for its services (to the extent pre-approved by the
Company in writing), and the Trustee shall be entitled to be reimbursed for such
pre-approved payments, subject to Section 8.6.
The provisions of Sections 8.2, 8.3, 8.4, 9.3 and this Section 17.11
shall be applicable to any authenticating agent.
Section 17.12 Execution in Counterparts. This Indenture may be executed
in any number of counterparts, each of which shall be an original, but such
counterparts shall together constitute but one and the same instrument.
State Street Bank and Trust Company of California, N.A. hereby accepts
the trusts in this Indenture declared and provided, upon the terms and
conditions hereinabove set forth.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly signed all as of the date first written above.
HNC SOFTWARE INC.
By:________________________________________
Title: ____________________________________
STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A.,
as Trustee
By:________________________________________
Title: ____________________________________
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EXHIBIT A - FORM OF NOTE
[FORM OF FACE OF NOTE]
No.___________ $______________
CUSIP: ______________
HNC SOFTWARE INC.
___% Convertible Subordinated Note Due 2003
HNC SOFTWARE INC., a corporation duly organized and validly existing
under the laws of the State of Delaware (herein called the "Company", which term
includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received hereby promises to pay to
_____________________, or registered assigns, the principal sum of______________
______________________________ Dollars on March 1, 2003, and to pay interest on
said principal sum semiannually on March 1 and September 1 of each year,
commencing September 1, 1998, at the rate per annum specified in the title of
this Note, accrued from the March 1 or September 1, as the case may be, next
preceding the date of this Note to which interest has been paid or duly provided
for, unless the date of this Note is a date to which interest has been paid or
duly provided for, in which case interest shall accrue from the date of this
Note, or unless no interest has been paid or duly provided for on this Note, in
which case interest shall accrue from March ___, 1998, until payment of said
principal sum has been made or duly provided for. Notwithstanding the foregoing,
if the date hereof is after any February 15 or August 15, as the case may be,
and before the following March 1 or September 1, this Note shall bear interest
from such March 1 or September 1, respectively; provided, however, that if the
Company shall default in the payment of interest due on such March 1 or
September 1, then this Note shall bear interest from the next preceding March 1
or September 1 to which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for on this Note, from March __, 1998.
The interest so payable on any March 1 or September 1 will be paid to the Person
in whose name this Note (or one or more Predecessor Notes) is registered at the
close of business on the record date, which shall be the February 15 or August
15 (whether or not a Business Day) next preceding such March 1 or September 1,
respectively; provided that any such interest not punctually paid or duly
provided for shall be payable as provided in the Indenture. Payment of the
principal of and interest accrued on this Note shall be made at the office or
agency of the Company maintained for that purpose in the Borough of Manhattan,
The City of New York, or, at the option of the holder of this Note, at the
Corporate Trust Office of the Trustee, in such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts; provided, however, that at the option of
the Company, payment of interest may be made by check mailed to the registered
address of
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the Person entitled thereto; provided that, with respect to any Holder of Notes
with an aggregate principal amount equal to or in excess of $1,000,000, at the
request of such Holder in writing, interest on such Holder's Notes shall be paid
by wire transfer in immediately available funds in accordance with the wire
transfer instruction supplied by such Holder to the Trustee and paying agent (if
different from the Trustee).
Reference is made to the further provisions of this Note set forth on
the reverse hereof, including, without limitation, provisions subordinating the
payment of principal of and premium, if any, and interest on this Note to the
prior payment in full of all Senior Indebtedness as defined in the Indenture and
provisions giving the holder of this Note the right to convert this Note into
Common Stock of the Company on the terms and subject to the limitations referred
to on the reverse hereof and as more fully specified in the Indenture. Such
further provisions shall for all purposes have the same effect as though fully
set forth at this place.
This Note shall be deemed to be a contract made under the laws of the
State of New York, and for all purposes shall be construed in accordance with
and governed by the laws of said State.
This Note shall not be valid or become obligatory for any purpose until
the certificate of authentication hereon shall have been manually signed by the
Trustee or a duly authorized authenticating agent under the Indenture.
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed
under its corporate seal.
HNC SOFTWARE INC.
Dated:____________________
By:________________________________________
Title: ____________________________________
Attest:
____________________________________________
Secretary
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[FORM OF CERTIFICATE OF AUTHENTICATION]
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes described in the within-named Indenture.
STATE STREET BANK AND TRUST COMPANY
OF CALIFORNIA, N.A., as Trustee
By:_____________________________________________
Authorized Signatory
[By:____________________________________________
As Authentication Agent (if different
from Trustee)]
[FORM OF REVERSE OF NOTE]
HNC SOFTWARE INC.
[ %] Convertible Subordinated Note Due 2003
This Note is one of a duly authorized issue of Notes of the Company,
designated as its [___%] Convertible Subordinated Notes due 2003 (herein called
the "Notes"), limited to the aggregate principal amount of $100,000,000 all
issued or to be issued under and pursuant to an Indenture dated as of March 1,
1998 (herein called the "Indenture"), between the Company and State Street Bank
and Trust Company of California, N.A. (herein called the "Trustee"), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Trustee, the Company and the holders of the Notes.
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of and accrued interest on all Notes
may be declared, and upon said declaration shall become, due and payable in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than a majority of the
aggregate principal amount of the Notes at the time outstanding, evidenced as in
the Indenture provided, to execute supplemental
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indentures adding any provisions to or changing in any manner or eliminating any
of the provisions of the Indenture or of any supplemental indenture or modifying
in any manner the rights of the holders of the Notes; provided, however, that no
such supplemental indenture shall (i) extend the fixed maturity of any Note, or
reduce the rate or extend the time of payment of interest thereon, or reduce the
principal amount thereof or premium, if any, thereon, or reduce any amount
payable on redemption or repurchase thereof, impair or change in any respect
adverse to the Holders of Notes the obligation of the Company to make an offer
to repurchase Notes and repurchase Notes in accordance with such offer upon the
happening of a Fundamental Change (as defined in the Indenture), or impair or
adversely affect the right of any Holder to institute suit for the payment
thereof, or make the principal thereof or interest or premium, if any, thereon
payable in any coin or currency other than that provided in the Notes, or impair
or change in any respect adverse to the Holders of the Notes the right to
convert the Notes into Common Stock subject to the terms set forth in the
Indenture, including Section 15.11 thereof, or modify the provisions of the
Indenture with respect to the subordination of the Notes in a manner adverse to
the Holders, without the consent of the holder of each Note so affected or (ii)
reduce the aforesaid percentage of Notes, the holders of which are required to
consent to any such supplemental indenture, without the consent of the holders
of all Notes then outstanding. It is also provided in the Indenture that the
holders of a majority in aggregate principal amount of the Notes at the time
outstanding may on behalf of the holders of all of the Notes waive any past
default or Event of Default under the Indenture and its consequences except a
default in the payment of interest or any premium on or the principal of any of
the Notes, a default in the payment of Redemption Price pursuant to Article III
or Repurchase Price pursuant to Article XVI or a failure by the Company to
convert any Notes into Common Stock of the Company. Any such consent or waiver
by the holder of this Note (unless revoked as provided in the Indenture) shall
be conclusive and binding upon such holder and upon all future holders and
owners of this Note and any Notes which may be issued in exchange or
substitution hereof, irrespective of whether or not any notation thereof is made
upon this Note or such other Notes.
The indebtedness evidenced by the Notes is, to the extent and in the
manner provided in the Indenture, expressly subordinate and subject in right of
payment to the prior payment in full of all Senior Indebtedness of the Company,
as defined in the Indenture, whether outstanding at the date of the Indenture or
thereafter incurred, and this Note is issued subject to the provisions of the
Indenture with respect to such subordination. Each holder of this Note, by
accepting the same, agrees to and shall be bound by such provisions and
authorizes the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination so provided and appoints the Trustee
his attorney in fact for such purpose.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Note at the place, at the respective times, at the rate and in the coin
or currency herein prescribed.
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Interest on the Notes shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
The Notes are issuable in registered form without coupons in
denominations of $1,000 principal amount and integral multiples thereof. At the
office or agency of the Company referred to on the face hereof, and in the
manner and subject to the limitations provided in the Indenture, without payment
of any service charge but with payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any
registration or exchange of Notes, Notes may be exchanged for a like aggregate
principal amount of Notes of other authorized denominations.
The Notes will not be redeemable at the option of the Company prior to
March 6, 2001. On or after such date and prior to maturity the Notes may be
redeemed at the option of the Company as a whole, or from time to time in part,
upon mailing a notice of such redemption not less than 20 nor more than 60 days
before the Redemption Date to the holders of Notes at their last registered
addresses, all as provided in the Indenture, at the following Redemption Prices
(expressed as percentages of the principal amount), together in each case with
accrued interest to, but excluding, the date fixed for redemption.
If redeemed during the 12-month period beginning March 1, 2001
(beginning March 6, 2001 and ending February 28, 2002, in the case of the first
such period):
Year Percentage
---- ----------
2001 %
2002
and 100% at March 1, 2003; provided that any semi-annual payment of interest
becoming due on the Redemption Date shall be payable to the Holders of record on
the Regular Record Date of the Notes being redeemed. The Notes are not subject
to redemption through the operation of any sinking fund.
Upon the occurrence of a Fundamental Change, as defined in the
Indenture, prior to March 1, 2003, the Holder has the right, at such holder's
option, to require the Company to repurchase this Note or any portion of the
principal amount hereof that is an integral multiple of $1,000 on the date (the
"Repurchase Date") that is 45 days after the date of the Company Notice (as
defined in the Indenture) at a price (the "Repurchase Price") (expressed as a
percentage of the principal amount) equal to (i) ___% if the Repurchase Date is
during the 12-month period beginning Xxxxx 0, 0000, (xx) ___% if the Repurchase
Date is during the 12-month period beginning Xxxxx 0, 0000, (xxx) ___% if the
Repurchase Date is during the 12-month period beginning March 1, 2000 and (iv)
thereafter at the redemption price set forth in the preceding paragraph which
would be applicable to a redemption at the option of the Company on the
Repurchase Date; provided that, if the Applicable Price (as defined in the
Indenture) is less than
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the Reference Market Price (as defined in the Indenture), the Company shall
repurchase such Notes at a price equal to the foregoing redemption price
multiplied by the fraction obtained by dividing the Applicable Price by the
Reference Market Price. In each case, the Company shall also pay accrued
interest on the repurchased Notes to, but excluding, the Repurchase Date,
provided, however, that if the Repurchase Date is March 1 or September 1, then
the interest payable on the Repurchase Date shall be paid to the holder of
record of the Note on the immediately preceding Record Date. The Company shall
mail to all holders of record of the Notes a notice of the occurrence of a
Fundamental Change and of the repurchase right arising as a result thereof on or
before 30 calendar days after the occurrence of such Fundamental Change.
Subject to the provisions of the Indenture, the holder hereof has the
right, at its option, at any time after issuance of the Notes and prior to the
close of business on March 1, 2003, or, as to all or any portion hereof called
for redemption, prior to the close of business on the Business Day next
preceding the date fixed for redemption (unless the Company shall default in
payment due upon redemption), to convert the principal hereof or any portion of
such principal which is $1,000 or an integral multiple thereof, into that number
of fully paid and non-assessable shares of the Company's Common Stock, as said
shares shall be constituted at the date of conversion, obtained by dividing the
principal amount of this Note or portion thereof to be converted by the
conversion price of $ as such conversion price is adjusted from time to time as
provided in the Indenture, upon surrender of this Note, together with a
conversion notice as provided in the Indenture and this Note, to the Company at
the office or agency of the Company maintained for that purpose in the Borough
of Manhattan, The City of New York, or at the option of such holder, the
Corporate Trust Office of the Trustee, and, unless the shares issuable on
conversion are to be issued in the same name as this Note, duly endorsed by, or
accompanied by instruments of transfer in form satisfactory to the Company duly
executed by, the holder or by his duly authorized attorney. No adjustment in
respect of interest or dividends will be made upon any conversion; provided,
however, that if this Note shall be surrendered for conversion during the period
from the close of business on any Regular Record Date for the payment of
interest through the close of business on the Business Day prior to the next
succeeding interest payment date, this Note (unless it or the portion thereof
being converted shall have been called for redemption pursuant to a notice of
redemption mailed to the Holders in accordance with the Indenture) must be
accompanied by an amount, in funds acceptable to the Company, equal to the
interest otherwise payable on such interest payment date on the principal amount
being converted. No fractional shares of Common Stock will be issued upon any
conversion, but an adjustment in cash will be paid to the holder, as provided in
the Indenture, in respect of any fraction of a share which would otherwise be
issuable upon the surrender of any Note or Notes for conversion.
Any Notes called for redemption, unless surrendered for conversion on or
before the close of business on the last Business Day prior to the Redemption
Date, may be deemed to be purchased from the holder of such Notes at an amount
equal to the applicable Redemption Price, together with accrued interest to (but
excluding) the Redemption Date, by one or more investment bankers or other
purchasers who may agree with the Company to purchase such
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Notes from the holders thereof and convert them into Common Stock of the Company
and to make payment for such Notes as aforesaid to the Trustee in trust for such
holders.
Upon due presentment for registration of transfer of this Note at the
office or agency of the Company in the Borough of Manhattan, The City of New
York, or at the option of the holder of this Note, at the Corporate Trust Office
of the Trustee, a new Note or Notes of authorized denominations for an equal
aggregate principal amount will be issued to the transferee in exchange thereof,
subject to the limitations provided in the Indenture, without charge except for
any tax or other governmental charge imposed in connection therewith.
The Company, the Trustee, any authenticating agent, any paying agent,
any conversion agent and any Note registrar may deem and treat the registered
holder hereof as the absolute owner of this Note (whether or not this Note shall
be overdue and notwithstanding any notation of ownership or other writing
hereon), for the purpose of receiving payment hereof, or on account hereof, for
the conversion hereof and for all other purposes, and neither the Company nor
the Trustee nor any other authenticating agent nor any paying agent nor any
other conversion agent nor any Note registrar shall be affected by any notice to
the contrary. All payments made to or upon the order of such registered holder
shall, to the extent of the sum or sums paid, satisfy and discharge liability
for monies payable on this Note.
No recourse for the payment of the principal of or premium, if any, or
interest on this Note, or for any claim based hereon or otherwise in respect
hereof, and no recourse under or upon any obligation, covenant or agreement of
the Company in the Indenture or any indenture supplemental thereto or in any
Note, or because of the creation of any indebtedness represented thereby, shall
be had against any incorporator, stockholder, employee, agent, officer, director
or Subsidiary, as defined in the Indenture, as such, past, present or future, of
the Company or of any successor corporation, either directly or through the
Company or any successor corporation, whether by virtue of any constitution,
statute or rule of law or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by the acceptance hereof and as part of the
consideration for the issue hereof, expressly waived and released.
Terms used in this Note and defined in the Indenture are used herein as
therein defined.
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ABBREVIATIONS
The following abbreviations, when used in the inscription of the face of
this Note, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT -
TEN ENT - as tenants by the _________________ Custodian
entireties (Cust)
JT TEN - as joint tenants with _________________ under
right of survivorship (Minor)
and not as tenants in
common
Uniform Gifts to
Minors Act_________________
(State)
Additional abbreviations may also be used though not
in the above list.
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[FORM OF CONVERSION NOTICE]
CONVERSION NOTICE
To: HNC SOFTWARE INC.
The undersigned registered owner of this Note hereby irrevocably
exercises the option to convert this Note, or the portion hereof (which is
$1,000 principal amount or an integral multiple thereof) below designated, into
shares of Common Stock in accordance with the terms of the Indenture referred to
in this Note, and directs that the shares issuable and deliverable upon such
conversion, together with any check in payment for fractional shares and any
Notes representing any unconverted principal amount hereof, be issued and
delivered to the registered holder hereof unless a different name has been
indicated below. If shares or any portion of this Note not converted are to be
issued in the name of a Person other than the undersigned, the undersigned will
pay all transfer taxes payable with respect thereto. Any amount required to be
paid to the undersigned on account of interest accompanies this Note.
Dated:_________________
___________________________________
___________________________________
Signature(s)
Signature(s) must be guaranteed by an eligible Guarantor Institution (banks,
stock brokers, savings and loan associations and credit unions) with membership
in an approved signature guarantee medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15 if shares of Common Stock are to be issued, or
Notes are to be delivered, other than to and in the name of the registered
holder.
________________________________
Signature Guarantee
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Fill in for registration of shares if to be issued, and Notes if to be
delivered, other than to and in the name of the registered holder:
________________________________
(Name)
________________________________
(Xxxxxx Xxxxxxx)
________________________________
(City, State and Zip Code)
Please print name and address
Principal amount to be converted
(if less than all): $_____,000
______________________________________
Social Security or Other
Taxpayer Identification Number
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[FORM OF OPTION TO ELECT REPURCHASE
UPON A FUNDAMENTAL CHANGE]
To: HNC Software Inc.
The undersigned registered owner of this Note hereby acknowledges
receipt of a notice from HNC Software Inc. (the "Company") as to the occurrence
of a Fundamental Change with respect to the Company and requests and instructs
the Company to repay the entire principal amount of this Note, or the portion
thereof (which is $1,000 principal amount or an integral multiple thereof) below
designated, in accordance with the terms of the Indenture referred to in this
Note, together with accrued interest to such date, to the registered holder
hereof.
Dated:______________________
__________________________________
__________________________________
Signature(s)
__________________________________
Social Security or Other
Taxpayer Identification Number
Principal amount to be repaid
(if less than all): $_____,000
NOTICE: The above signatures of the
holder(s) hereof must correspond
with the name as written upon the
face of the Note in every particular
without alteration or enlargement or
any change whatever.
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[FORM OF ASSIGNMENT]
For value received __________________________ hereby sell(s), assign(s)
and transfer(s) unto ________________________________ (Please insert social
security or other identifying number of assignee) the within Note, and hereby
irrevocably constitutes and appoints___________________________________________
attorney to transfer the said Note on the books of the Company, with full power
of substitution in the premises.
Dated:_______________________
______________________________
Signature(s)
Signature(s) must be guaranteed by an eligible Guarantor Institution (banks,
stock brokers, savings and loan associations and credit unions) with membership
in an approved signature guarantee medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15
_______________________________
Signature Guarantee
NOTICE: The signature on the conversion notice, the option to elect repurchase
upon a Fundamental Change or the assignment must correspond with the name as
written upon the face of the Note in every particular without alteration or
enlargement or any change whatever.
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