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TRANSWITCH CORPORATION
And
U.S. BANK NATIONAL ASSOCIATION
as Trustee
INDENTURE
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Dated as of August __, 2003
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6% Convertible Plus Cash Notes(SM) due 2007
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TRANSWITCH CORPORATION
Reconciliation and tie between Trust Indenture Act
of 1939 and Indenture, dated as of August __, 2003
Trust Indenture Indenture Section
Act Section
(S) 310 (a)(1) ................................... 5.10
(a)(2) ................................... 5.10
(b) ................................... 5.03, 5.06
(S) 311 ................................... 5.12
(S) 312 (a) ................................... 6.04
(S) 312 (c) ................................... 6.01
(S) 313 (a) ................................... 6.02
(S) 313 (c) ................................... 1.01 "Outstanding",
5.05, 6.02, 6.03(c)
(S) 314 (a)(1-3) ................................... 6.03
(a)(4) ................................... 9.06
(c)(1) ................................... 1.03
(c)(2) ................................... 1.03
(e) ................................... 1.03
(S) 315 (a)(2) ................................... 5.02
(b) ................................... 5.02(h), 5.05
(c) ................................... 5.01
(d) ................................... 5.01
(e) ................................... 4.15
(S) 316 (a) (last
sentence) ................................... 1.01 "Outstanding"
(a)(1)(A) ................................... 4.12
(a)(1)(B) ................................... 4.13
(b) ................................... 4.08
(c) ................................... 1.05(d)(i)
(S) 317 (a)(1) ................................... 4.03
(a)(2) ................................... 4.04
(b) ................................... 9.03
(S) 318 (a) ................................... 1.12
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Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
TABLE OF CONTENTS
Page
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ARTICLE 1 Definitions and Other Provisions of General Application ....... 1
SECTION 1.01. Definitions ...................................... 1
SECTION 1.02. Other Definitions ................................ 8
SECTION 1.03. Compliance Certificates and Opinions ............. 9
SECTION 1.04. Form of Documents Delivered to Trustee ........... 9
SECTION 1.05. Acts of Holders. ................................. 10
SECTION 1.06. Notices, Etc ..................................... 11
SECTION 1.07. Notice to Holders; Waiver. ....................... 12
SECTION 1.08. Effect of Headings and Table of Contents ......... 13
SECTION 1.09. Successors and Assigns ........................... 13
SECTION 1.10. Separability Clause .............................. 13
SECTION 1.11. Benefits of Indenture ............................ 13
SECTION 1.12. Governing Law .................................... 13
SECTION 1.13. Legal Holidays ................................... 13
SECTION 1.14. Personal Immunity from Liability for Incorporators,
Stockholders, Etc ................................ 13
SECTION 1.15. Conflict with Trust Indenture Act ................ 14
SECTION 1.16. Execution in Counterparts ........................ 14
ARTICLE 2 Note Forms .................................................... 14
SECTION 2.01. Forms of Notes ................................... 14
SECTION 2.02. Form of Trustee's Certificate of Authentication .. 14
SECTION 2.03. Notes Issuable in Global Form .................... 14
ARTICLE 3 The Notes ..................................................... 15
SECTION 3.01. Title and Term ................................... 15
SECTION 3.02. Denominations .................................... 16
SECTION 3.03. Execution, Authentication, Delivery and Dating ... 16
SECTION 3.04. Registration, Registration of Transfer
and Exchange ..................................... 16
SECTION 3.05. Mutilated, Destroyed, Lost and Stolen Notes ...... 18
SECTION 3.06. Payment of Interest; Interest Rights Preserved ... 19
SECTION 3.07. Persons Deemed Owners ............................ 21
SECTION 3.08. Cancellation ..................................... 21
SECTION 3.09. Computation of Interest .......................... 21
SECTION 3.10. CUSIP Numbers .................................... 22
ARTICLE 4 Remedies ...................................................... 22
SECTION 4.01. Events of Default ................................ 22
SECTION 4.02. Acceleration of Maturity; Rescission
and Annulment .................................... 24
SECTION 4.03. Collection of Indebtedness and Suits for
Enforcement by Trustee ........................... 24
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SECTION 4.04. Trustee May File Proofs of Claim ................. 25
SECTION 4.05. Trustee May Enforce Claims Without
Possession of Notes .............................. 26
SECTION 4.06. Application of Money Collected ................... 26
SECTION 4.07. Limitation on Suits .............................. 27
SECTION 4.08. Unconditional Right of Holders to Receive
Principal, Premium, If Any, and Interest ......... 27
SECTION 4.09. Restoration of Rights and Remedies ............... 27
SECTION 4.10. Rights and Remedies Cumulative ................... 28
SECTION 4.11. Delay or Omission Not Waiver ..................... 28
SECTION 4.12. Control by Holders of Notes ...................... 28
SECTION 4.13. Waiver of Past Defaults .......................... 28
SECTION 4.14. Waiver of Usury, Stay or Extension Laws .......... 29
SECTION 4.15. Undertaking for Costs ............................ 29
ARTICLE 5 The Trustee ................................................... 29
SECTION 5.01. General .......................................... 29
SECTION 5.02. Certain Rights of Trustee ........................ 30
SECTION 5.03. Individual Rights of Trustee ..................... 31
SECTION 5.04. Trustee's Disclaimer ............................. 31
SECTION 5.05. Notice of Default ................................ 32
SECTION 5.06. Conflicting Interests of Trustee ................. 32
SECTION 5.07. Compensation and Indemnity ....................... 32
SECTION 5.08. Replacement of Trustee ........................... 33
SECTION 5.09. Successor Trustee by Merger, Etc ................. 34
SECTION 5.10. Eligibility ...................................... 34
SECTION 5.11. Money Held in Trust .............................. 34
SECTION 5.12. Preferential Collection of Claims ................ 34
SECTION 5.13. Trustee's Application for Instructions
from the Company ................................. 34
ARTICLE 6 Holders' Lists And Reports By Trustee And Company ............. 34
SECTION 6.01. Disclosure of Names and Addresses of Holders ..... 34
SECTION 6.02. Reports by Trustee ............................... 35
SECTION 6.03. Reports by Company ............................... 35
SECTION 6.04. Company to Furnish Trustee Names and
Addresses of Holders. ............................ 35
ARTICLE 7 Consolidation, Merger, Sale, Lease Or Conveyance .............. 36
SECTION 7.01. Consolidations and Mergers of Company and
Sales, Leases and Conveyances Permitted
Subject to Certain Conditions .................... 36
SECTION 7.02. Rights and Duties of Successor Corporation ....... 36
SECTION 7.03. Officers' Certificate and Opinion of Counsel ..... 37
ARTICLE 8 Supplemental Indentures ....................................... 37
SECTION 8.01. Supplemental Indentures Without Consent of
Holders .......................................... 37
SECTION 8.02. Supplemental Indentures with Consent of Holders .. 38
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SECTION 8.03. Execution of Supplemental Indenture .............. 39
SECTION 8.04. Effect of Supplemental Indentures ................ 39
SECTION 8.05. Conformity with Trust Indenture Act .............. 39
SECTION 8.06. Reference in Notes to Supplemental Indentures .... 39
ARTICLE 9 Covenants ..................................................... 40
SECTION 9.01. Payment of Principal, Premium, If Any,
and Interest ..................................... 40
SECTION 9.02. Maintenance of Office or Agency .................. 40
SECTION 9.03. Money for Notes Payments to Be Held in Trust ..... 40
SECTION 9.04. Existence ........................................ 41
SECTION 9.05. Payment of Taxes and Other Claims ................ 42
SECTION 9.06. Statement as to Compliance; Notice of Default. ... 42
SECTION 9.07. Prohibition on Private Transactions Involving
Existing Notes ................................... 42
SECTION 9.08. Waiver of Certain Covenants ...................... 42
ARTICLE 10 Redemption Of Notes .......................................... 43
SECTION 10.01. Optional Redemption by the Company. .............. 43
SECTION 10.02. Election to Redeem; Notice to Trustee ............ 43
SECTION 10.03. Selection by Trustee of Notes to Be Redeemed ..... 43
SECTION 10.04. Notice of Redemption ............................. 44
SECTION 10.05. Deposit of Redemption Price ...................... 45
SECTION 10.06. Notes Payable on Redemption Date ................. 45
SECTION 10.07. Notes Redeemed in Part ........................... 45
ARTICLE 11 Repurchase At Option Of Holders Upon Change In Control ....... 45
SECTION 11.01. Right to Require Repurchase ...................... 45
SECTION 11.02. Notices; Method of Exercising Repurchase
Right, Etc ....................................... 46
SECTION 11.03. Certain Definitions .............................. 48
SECTION 11.04. Change in Control ................................ 48
ARTICLE 12 Conversion ................................................... 49
SECTION 12.01. Conversion Privilege and Conversion
Consideration. ................................... 49
SECTION 12.02. Exercise of Conversion Privilege ................. 51
SECTION 12.03. Cash Payments in Lieu of Fractional Shares ....... 52
SECTION 12.04. Adjustment of Conversion Consideration ........... 53
SECTION 12.05. Notice of Adjustments ............................ 63
SECTION 12.06. Notice of Certain Corporate Action ............... 64
SECTION 12.07. Company's Obligation Regarding Common Stock ...... 65
SECTION 12.08. Taxes on Conversions ............................. 65
SECTION 12.09. Covenant as to Common Stock ...................... 65
SECTION 12.10. Cancellation of Converted Notes .................. 66
SECTION 12.11. Provisions in Case of Reclassification,
Consolidation, Merger or Sale of Assets .......... 66
SECTION 12.12. Automatic Conversion by the Company .............. 66
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SECTION 12.13. Notification to Trustee .......................... 68
SECTION 12.14. Company's Obligation ............................. 68
SIGNATURES
EXHIBIT A - FORM OF NOTE
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INDENTURE, dated as of August __, 2003, between TRANSWITCH CORPORATION, a
Delaware corporation (the "Company"), having its principal xxxxxx xx Xxxxx
Xxxxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxxxxx 00000 and U.S. Bank National Association,
a national banking association, as Trustee hereunder (the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the issue of its 6% Convertible Plus Cash
NotesSM due 2007 (the "Notes") in an aggregate original principal amount not to
exceed $100,000,000, and to provide for such issuance, the Company has duly
authorized the execution and delivery of this Indenture.
Upon qualification of this Indenture under the Trust Indenture Act of 1939, as
amended (the "TIA"), it shall be subject to the provisions of the TIA that are
deemed to be incorporated into this Indenture and shall, to the extent
applicable, be governed by such provisions.
All things necessary to make this Indenture a valid agreement of the Company, in
accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by the
holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all the holders of the Notes, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions. For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular, and
references to he or him or she or her are intended to be gender neutral;
(2) all other terms used herein which are defined in the TIA, either
directly or by reference therein, have the meanings assigned to them therein;
(3) the word "including" means "including without limitation," and
(4) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act," when used with respect to any Holder, has the meaning specified in
Section 1.05.
"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 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.
"Authorized Newspaper" means a newspaper, printed in the English language or in
an official language of the country of publication, customarily published on
each Business Day, whether or not published on Saturdays, Sundays or holidays,
and of general circulation in each place in connection with which the term is
used or in the financial community of each such place. Whenever successive
publications are required to be made in Authorized Newspapers, the successive
publications may be made in the same or in different Authorized Newspapers in
the same city meeting the foregoing requirements and in each case on any
Business Day.
"Automatic Conversion" has the meaning specified in Section 12.12(a).
"Automatic Conversion Date" has the meaning specified in Section 12.12(a).
"Automatic Conversion Price" has the meaning specified in Section 12.12(a).
"Bankruptcy Law" has the meaning specified in Section 4.01.
"Base Shares" has the meaning specified in Section 12.01.
"Board of Directors" means the board of directors of the Company, the executive
committee of that board or any committee of that board duly authorized to act
hereunder.
"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 and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday which
is not a day on which banking institutions in the City of New York or a city in
which the Corporate Trust Office is located or, when used with respect to any
Place of Payment, such Place of Payment, are authorized or obligated by law,
regulation or executive order to close.
"close of business" means 5:00 p.m. (New York City time).
"Commission" means the Securities and Exchange Commission, as from time to time
constituted, created under the Securities Exchange Act of 1934, or, if at any
time after execution of this instrument such Commission is not existing and
performing substantially the duties now assigned to it under the TIA, then the
body performing such duties on such date.
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"Common Stock" means the common stock of the Company, $0.001 par value, as it
exists on the date of this Indenture and any shares of any class or classes of
capital stock of the Company resulting from any reclassification or
reclassifications thereof.
"Company" means the Person named as the "Company" in the first paragraph of this
Indenture until a successor corporation shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor corporation.
"Company Request" and "Company Order" mean, respectively, a written request or
order signed in the name of the Company by the Chairman of the Board of
Directors, the Chief Executive Officer, the President, the Chief Financial
Officer or a Vice President of the Company and any of the foregoing or any
Assistant Vice President, the Treasurer, an Assistant Treasurer, the Secretary
or an Assistant Secretary of the Company, and delivered to the Trustee.
"Conversion Agent" means any Person authorized by the Company pursuant to
Section 9.02 to convert Notes in accordance with Article 12.
"Conversion Consideration" has the meaning specified in Section 12.01.
"Conversion Date" has the meaning specified in Section 2.03.
"Corporate Trust Office" means the office of the Trustee at which, at any
particular time, its corporate trust business as it relates to this Indenture
shall be principally administered and as to which notice to that effect has been
delivered to the Company and the Holders in accordance with the provisions
hereof, which office at the date hereof is located at U.S. Bank National
Association, Xxx Xxxxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxx, XX 00000 Attention:
Corporate Trust Services/Chi C. Ma.
"Custodian" means U.S. Bank National Association with respect to the Notes in
global form, or any successor entity thereto.
"corporation" means a corporation, association, partnership, company (including
limited liability company), joint-stock company or business trust.
"daily volume-weighted average price" has the meaning specified in Section
12.03.
"Default" means any event that is, or after notice or passage of time or both
would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 3.06.
"Dollar" or "$" means a dollar or other equivalent unit in such coin or currency
of the United States of America as at the time shall be legal tender for the
payment of public and private debts.
"DTC" means The Depository Trust Company.
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"Exchange Act" means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
"Existing Notes" shall mean the 4 1/2% Convertible Notes due 2005 issued
pursuant to the Existing Note Indenture.
"Existing Note Indenture" shall mean that certain Indenture, dated as of
September 12, 2000, between the Company and State Street Bank and Trust Company.
"Government Obligations" means securities that are (i) direct obligations of the
United States of America, for the payment of which its full faith and credit is
pledged, or (ii) obligations of a Person controlled or supervised by and acting
as an agency or instrumentality of the United States of America, the payment of
which is unconditionally guaranteed as a full faith and credit obligation by the
United States of America, which is not callable or redeemable at the option of
the issuer thereof, and shall also include a depository receipt issued by a bank
or trust company as custodian with respect to any such Government Obligation or
a specific payment of interest on or principal of any such Government Obligation
held by such custodian for the account of the holder of a depository receipt,
provided that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the Government
Obligation or the specific payment of interest on or principal of the Government
Obligation evidenced by such depository receipt.
"Holder" means the Person in whose name a Note is registered in the Note
Register.
"Indenture" means this instrument as originally executed or as it may from time
to time be supplemented or amended by one or more indentures supplemental hereto
entered into pursuant to the applicable provisions hereof.
"Initial Automatic Conversion Notice" has the meaning specified in Section
12.12(b).
"Interest Payment Date" has the meaning specified in Section 3.06.
"Make-Whole Payment" means the interest to be paid or provided for by the
Company upon an Automatic Conversion in an amount equal to two (2) full years of
interest on the principal amount of the Notes so converted, less any interest
paid or provided for on the principal amount of such Notes so converted prior to
the Automatic Conversion Date; provided, however, in no event shall the
Make-Whole Payment, if any, be less than an amount equal to one (1) full year of
interest on the Notes. For purposes of this definition, interest shall be
computed on the basis of 365 days elapsed over a 360-day year. By way of
illustration, "two (2) full years of interest" on a principal amount equal to
$1,000 is $121.67 ($1,000 x (730/360) x 6%) and "one (1) full year of interest"
on a principal amount equal to $1,000 is $60.84 ($1,000 x (365/360) x 6%). The
Company, solely at its option, may pay, in whole or in part, the Make-Whole
Payment in cash or in shares of Common Stock. If the Company elects to pay or
provide for the Make-Whole Payment in shares of Common Stock, such Make-Whole
Shares (as defined below) will be valued at the greater of (i) 95% of the simple
average of the daily volume-weighted average price of the Common Stock for the
ten (10)
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Trading Days ending on and including the second Trading Day immediately
preceding the Automatic Conversion Date and (ii) 95% of the Automatic Conversion
Price. The Company shall not issue fractional shares of Common Stock or any
scrip representing fractional shares of Common Stock upon such payment of or
provision for Make-Whole Shares. If any fractional share of Common Stock
otherwise would be issuable upon the payment of or provision for Make-Whole
Shares, the Company, at its option, may either make an adjustment therefore in
cash at the current market value thereof to the holder of the Notes or round the
fractional shares up to the nearest whole share. For these purposes, the current
market value of a share of Common Stock shall be the Closing Price on the first
Trading Day immediately preceding the Automatic Conversion Date and such Closing
Price shall be determined as provided in Section 12.03. The Automatic Conversion
Price and any calculation in respect of the simple average of the daily
volume-weighted average price of the Common Stock shall be adjusted as provided
for in Section 12.04.
"Make-Whole Shares" means any shares of Common Stock with which the Company
elects to pay or provide for the Make-Whole Payment, as provided above.
"Maturity" means the date on which the principal of the Notes becomes due and
payable as therein or herein provided, whether at the Stated Maturity or upon
conversion or by declaration of acceleration, notice of redemption, notice of
option to elect repayment or otherwise.
"Nasdaq" shall mean the Nasdaq National Market or, if the Common Stock of the
Company is quoted on the Nasdaq SmallCap Market at the time in issue, the Nasdaq
SmallCap Market.
"Note" or "Notes" means any Note or Notes, as the case may be, issued,
authenticated and delivered under this Indenture.
"Officers' Certificate" means a certificate signed by the Chairman of the Board
of Directors, the President or a Vice President and by any of the foregoing or
the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary
of the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel for
the Company or who may be an employee of or other counsel for the Company and
who shall be reasonably satisfactory to the Trustee.
"Outstanding," when used with respect to Notes, means, as of the date of
determination, all Notes theretofore authenticated and delivered under this
Indenture, except:
(i) Notes theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Notes, or portions thereof, for whose payment or redemption or
repayment at the option of the Holder, money in the necessary amount has
been theretofore deposited with the Trustee or any Paying Agent (other than
the Company) in trust or set aside and segregated in trust by the Company
(if the Company shall act as its own
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Paying Agent) for the Holders of such Notes; provided that, if such Notes
are to be redeemed, notice of such redemption has been duly given pursuant
to this Indenture or provision therefor satisfactory to the Trustee has
been made;
(iii) Notes that have been paid pursuant to Section 3.05 or in
exchange for or in lieu of which other Notes have been authenticated and
delivered pursuant to this Indenture, other than any such Notes in respect
of which there shall have been presented to the Trustee proof satisfactory
to it that such Notes are held by a bona fide purchaser in whose hands such
Notes are valid obligations of the Company; and
(iv) Notes converted into Common Stock pursuant to or in accordance
with this Indenture;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or are present at
a meeting of Holders for quorum purposes, and for the purpose of making the
calculations required by TIA Section 313, Notes owned by the Company or any
other obligor upon the Notes under a supplemental indenture entered into in
accordance herewith or any Affiliate of the Company or of such other obligor
shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in making such calculation or
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Notes that the Trustee knows to be so owned shall be so
disregarded. Notes so owned that have been pledged in good faith may be regarded
as Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Notes and that the pledgee is not
the Company or any other obligor upon the Notes under a supplemental indenture
entered into in accordance herewith or any Affiliate of the Company or of such
other obligor.
"Paying Agent" means any Person (including the Company) authorized by the
Company to pay the principal of (and premium, if any) or interest on any Notes
on behalf of the Company.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
"Place of Payment" means the place or places where the principal of (and
premium, if any), interest on and the Redemption Prices and the Repurchase Price
with respect to the Notes are payable as specified by Section 9.02.
"Plus Cash Amount" has the meaning specified in Section 12.01.
"Predecessor Note" means, with respect to any Note, every previous Note
evidencing all or a portion of the same debt as that evidenced by such Note;
and, for the purposes of this definition, any Note authenticated and delivered
under Section 3.05 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Note shall be deemed to evidence the same debt as the mutilated,
destroyed, lost or stolen Note.
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"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," means the Optional Redemption Price as specified in Section
10.01.
"Regular Record Date" for the interest payable on any Interest Payment Date on
the Notes means the date specified for that purpose as contemplated by Section
3.06, whether or not a Business Day.
"Repurchase Event" has the meaning specified in Section 11.03.
"Responsible Officer," when used with respect to the Trustee, means any senior
vice president, any vice president, any assistant vice president, any assistant
secretary, or other officer of the Trustee working in its Corporate Trust
division, or any other officer of the Trustee working in its Corporate Trust
Division and customarily performing functions similar to those performed by any
of the above designated officers and also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"Second Automatic Conversion Notice" has the meaning specified in Section
12.12(d).
"Securities Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Significant Subsidiary" means any Subsidiary that is a "significant subsidiary"
(as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated under the
Securities Act) of the Company.
"Special Record Date" for the payment of any Defaulted Interest on the Notes
means a date fixed by the Trustee pursuant to Section 3.06.
"Stated Maturity" means the date specified in the Notes as the fixed date on
which the principal of, or interest on, such Notes is due and payable.
"Subsidiary" means a corporation a majority of the outstanding voting securities
of which is owned, directly or indirectly, by the Company or by one or more
other Subsidiaries of the Company, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting securities" means
shares, interests, participations or other equivalents of corporate stock,
partnership or limited liability company interests or any other participation,
right or other interest in the nature of an equity interest that ordinarily have
voting power for the election of directors, managers or trustees, whether at all
times or only so long as no senior class of equity interest has such voting
power by reason of any contingency.
"Threshold Price" means $[____], as adjusted as provided for in Section 12.04.
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"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939, and the
rules and regulations promulgated thereunder, as in force on the date this
Indenture is qualified thereunder; provided, however, that in the event the
Trust Indenture Act of 1939 or such rules and regulations are amended after such
date, "Trust Indenture Act" means, to the extent required by any such amendment,
the Trust Indenture Act of 1939 and such rules and regulations as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph of this
Indenture until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder.
"United States" means the United States of America (including the states and the
District of Columbia), its territories, its possessions and other areas subject
to its jurisdiction.
SECTION 1.02. Other Definitions
Defined in
Term Section
"Act" 1.05
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"Average Sale Price" 12.04
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"Bankruptcy Law" 4.01
----
"Change in Control" 11.04
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"Change in Control Purchase Notice" 11.02
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"Closing Price" 12.03
-----
"Commencement Date" 12.04
-----
"Company Notice" 11.02
-----
"Current Event" 12.04
-----
"Event of Default" 4.01
----
"Ex-Dividend Time" 12.04
-----
"Expiration Time" 12.04
-----
"Indemnities" 5.07
----
"Material Adverse Effect" 9.04
----
"Note Register" 3.04
----
"Note Registrar" 3.04
----
"Notice of Default" 4.01
----
"Optional Redemption" 10.01
-----
"Other Event" 12.04
-----
"Plus Cash Shares" 12.01
-----
"Purchased Shares" 12.04
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"Redeemable Capital Stock" 11.04
-----
"Reference Date" 12.04
-----
"Repurchase Date" 11.01
-----
"Repurchase Price" 11.01
-----
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"Time of Determination" 12.04
-----
"Trading Day" 12.03
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SECTION 1.03. Compliance Certificates and Opinions. Upon any application or
request by the Company to the Trustee to take any action under any provision 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, if any, have been complied with, except that in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that each individual signing such certificate or
opinion has read such condition or covenant and the definitions herein relating
thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such individual, he has
made such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such condition or covenant has been
complied with; and
(d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 1.04. Form of Documents Delivered to Trustee. In any case where several
matters are required to be certified by, or covered by an opinion of, any
specified Person, it is not necessary that all such matters be certified by, or
covered by the opinion of, only one such Person, or that they be so certified or
covered by only one document, but one such Person may certify or give an opinion
as to some matters and one or more other such Persons as to other matters, and
any such Person may certify or give an opinion as to such matters in one or
several documents.
Any certificate or opinion of an officer of the Company may be based, insofar as
it relates to legal matters, upon an Opinion of Counsel, or a certificate or
representations by counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the opinion, certificate or representations
with respect to the matters upon which such certificate or opinion is based are
erroneous. Any such Opinion of Counsel or certificate or representations may be
based, insofar as it relates to factual matters, upon a certificate or opinion
of, or representations by, an officer or officers of the Company stating that
the information as to such factual matters is in the possession of the Company,
unless such counsel knows that the certificate or opinion or representations as
to such matters are erroneous.
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Where any Person is required to make, give or execute two or more applications,
requests, consents, certificates, statements, opinions or other instruments
under this Indenture, they may, but need not, be consolidated and form one
instrument.
SECTION 1.05. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders of the Outstanding Notes may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agents duly appointed in writing. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent, or of the holding by any
Person of a Note, shall be sufficient for any purpose of this Indenture and
conclusive in favor of the Trustee and the Company and any agent of the Trustee
or the Company, if made in the manner provided in this Section 1.05.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness to such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other reasonable manner which the Trustee deems sufficient.
(c) The ownership of the Notes shall be proved by the Note Register.
(d) (i) If the Company shall solicit from the Holders any
request, demand, authorization, direction, notice, consent, waiver or
other Act, the Company may, at its option, in or pursuant to a Board
Resolution, fix in advance a record date for the determination of
Holders entitled to effect such request, demand, authorization,
direction, notice, consent, waiver or other Act, but the Company shall
have no obligation to do so; provided that the Company shall not be
entitled to set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in clause 1.05(d)(iii)
below. Notwithstanding TIA Section 316(c), such record date shall be
the record date specified in or pursuant to such Board Resolution,
which shall be a date not earlier than the date 30 days prior to the
first solicitation of Holders generally in connection therewith and not
later than the date such solicitation is completed. If such a record
date is fixed, such request, demand, authorization, direction, notice,
consent, waiver or other Act may be effected before or after such
record date, but only the Holders of record at the close of business on
such record date shall be deemed to be Holders for the purposes of
determining whether Holders of the requisite proportion of Outstanding
Notes have authorized or agreed or consented to such request,
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demand, authorization, direction, notice, consent, waiver or other Act,
and for that purpose the Outstanding Notes shall be computed as of such
record date; provided that no such authorization, agreement or consent
by the Holders on such record date shall be deemed effective unless it
shall become effective pursuant to the provisions of this Indenture not
later than eleven months after the record date.
(ii) Subject to clause 1.05(d)(iii) below, in the absence of
any such record date fixed by the Company, regardless as to whether any
solicitation of the Holders is occurring on behalf of the Company or
any Holder, the Trustee may, at its option, fix in advance a record
date for the determination of such Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or
other Act, but the Trustee shall have no obligation to do so. Any such
record date shall be a date not more than 30 days prior to the first
solicitation of Holders generally in connection therewith and no later
than the date of such solicitation.
(iii) The Trustee may set any day as a record date for the
purpose of determining the Holders of Outstanding Notes entitled to
join in the giving or making of (A) any notice of default, (B) any
declaration of acceleration referred to in Section 4.02, (C) any
request to institute proceedings referred to in Section 4.07(b), or (D)
any direction referred to in Section 4.12, and may also set an
expiration date by which the relevant Act must be taken. If any record
date is set pursuant to this paragraph, the Holders of Outstanding
Notes on such record date, and no other Holders, shall be entitled to
join in such notice, declaration, request or direction, whether or not
such Holders remain Holders after such record date; provided that no
such Act shall be effective hereunder unless taken on or prior to any
applicable expiration date by Holders of the requisite principal amount
of Outstanding Notes on such record date. Nothing in this paragraph
shall be construed to prevent the Trustee from setting a new record
date for any action (whereupon the record date previously set shall
automatically and without any action by any Person be canceled and of
no effect), nor shall anything in this paragraph be construed to render
ineffective any Act taken by Holders of the requisite principal amount
of Outstanding Notes on the date such Act is taken. Promptly after any
record date is set pursuant to this paragraph, the Trustee, at the
Company's expense, shall cause notice of such record date, the proposed
Act by Holders and the applicable expiration date to be given to the
Company in writing and to each Holder of Outstanding Notes in the
manner set forth in Section 1.07.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Note shall bind every future Holder of
the same Note and the Holder of every Note issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee, any Note
Registrar, any Paying Agent, any Conversion Agent or the Company in reliance
thereon, whether or not notation of such action is made upon such Note.
SECTION 1.06. Notices, Etc. to Trustee and Company. Any request, demand,
authorization, direction, notice, consent, waiver or other Act of Holders or
other notice or communication provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with:
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(a) the Trustee by any Holder or by the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or with
the Trustee, delivered in person, mailed by first class mail, postage prepaid,
or sent by facsimile or overnight courier, at its address as follows: if mailed
by first class mail, to U.S. Bank National Association, Corporate Trust
Services, X.X. Xxx 000, Xxxxxx, XX 00000-0000, Attention: TranSwitch Corporation
6% Convertible Plus Cash NotesSM due 2007, or if sent by other means to U.S.
Bank National Association, Corporate Trust Services, Xxx Xxxxxxx Xxxxxx, 0xx
Xxxxx, Xxxxxx, XX 00000, Attention: TranSwitch Corporation 6% Convertible Plus
Cash NotesSM due 2007 (facsimile: 617-603-6683), or to such other address or
facsimile number as the Trustee may designate by written notice from time to
time; provided that notices or other communications to the Trustee shall only be
deemed given when actually received by the Trustee,
(b) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and delivered in person, mailed by first class mail, postage prepaid, or
sent by facsimile or overnight courier, to the Company addressed to it at the
address of its principal office specified in the first paragraph of this
Indenture; provided that the Company may, by notice furnished in writing to the
Trustee, designate additional or different addresses for subsequent notices or
communications by the Company; and further provided that notices or other
communications to the Company shall only be deemed given when actually received
by the Company.
SECTION 1.07. Notice to Holders; Waiver.
Where this Indenture provides for notice of any event to Holders by the Company
or the Trustee, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and deposited in the mail, first-class postage
prepaid, to each such Holder affected by such event, at his address as it
appears in the Note Register, not later than the latest date, and not earlier
than the earliest date, prescribed for the giving of such notice. Such notice
shall be deemed to have been given when such notice is mailed. In any case where
notice to Holders is given by mail, neither the failure to mail such notice, nor
any defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders given as provided
herein. Any notice mailed to a Holder in the manner herein prescribed shall be
conclusively deemed to have been received by such Holder, whether or not such
Holder actually receives such notice.
If 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 as shall be made with the approval of
the Trustee shall constitute a sufficient notification to such Holders for every
purpose hereunder.
Any request, demand, authorization, direction, notice, consent, waiver or other
Act required or permitted under this Indenture shall be in the English language,
except that any published notice may be in an official language of the country
of publication.
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
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shall be the equivalent of such notice. Waivers of notice by Holders 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 1.08. Effect of Headings and Table of Contents. The Article and Section
headings herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.
SECTION 1.09. Successors and Assigns. All covenants and agreements in this
Indenture by the Company shall bind its successors and assigns, whether so
expressed or not.
SECTION 1.10. Separability Clause. In case any provision in this Indenture or in
any Note shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 1.11. Benefits of Indenture. Nothing in this Indenture or in the Notes,
express or implied, shall give to any Person, other than the parties hereto, any
Note Registrar, any Paying Agent, any Conversion Agent and their successors
hereunder and the Holders any benefit or any legal or equitable right, remedy or
claim under this Indenture.
SECTION 1.12. Governing Law. This Indenture and the Notes shall be governed by
and construed in accordance with the law of the State of New York without regard
to conflict of laws principles.
SECTION 1.13. Legal Holidays. In any case where any Interest Payment Date,
Redemption Date, Repurchase Date, Conversion Date, Automatic Conversion Date,
Stated Maturity or Maturity of any Note or the last date on which a Holder has
the right to convert his Notes shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or any
Note), payment of Redemption Price, Repurchase Price, Conversion Consideration,
Automatic Conversion Amount, Make-Whole Payment amount, interest or principal
(and premium, if any), or conversion of the Notes, need not be made at such
Place of Payment on such date, but may be made on the next succeeding Business
Day at such Place of Payment with the same force and effect as if made on the
Interest Payment Date, Redemption Date, Repurchase Date, Conversion Date,
Automatic Conversion Date or at the Stated Maturity or Maturity or on such last
day for conversion; provided that no interest shall accrue on the amount so
payable for the period from and after such Interest Payment Date, Redemption
Date, Repurchase Date, Conversion Date, Automatic Conversion Date, Stated
Maturity or Maturity or on such last day for conversion, as the case may be.
SECTION 1.14. Personal Immunity from Liability for Incorporators, Stockholders,
Etc. No recourse shall be had for the payment of the principal of or premium, if
any, or interest, if any, on any Note, or for any claim based thereon, or
otherwise in respect of any Note, or based on or in respect of this Indenture or
any indenture supplemental hereto, against any incorporator, or against any
past, present or future stockholder, director or officer, as such, of the
Company or of 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 expressly waived and
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released as a condition of, and as consideration for, the execution of this
Indenture and the issue of Notes.
SECTION 1.15. Conflict with Trust Indenture Act. If any provision hereof limits,
qualifies or conflicts with a provision of the TIA that is required under such
Act to be a part of and govern this Indenture, the latter provision shall
control. If any provision of this Indenture modifies or excludes any provision
of the TIA that may be so modified or excluded, the latter provision shall be
deemed to apply to this Indenture as so modified or to be excluded, as the case
may be. To the extent that any provision of a Note conflicts with a provision in
this Indenture, the provision of this Indenture shall control.
SECTION 1.16. 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.
ARTICLE 2
NOTE FORMS
SECTION 2.01. Forms of Notes. The Notes shall be in substantially the form of
Exhibit A hereto, and shall have notations, legends or endorsements required by
law, stock exchange rule or usage or as otherwise indicated in Exhibit A hereto.
SECTION 2.02. Form of Trustee's Certificate of Authentication. The Trustee's
certificate of authentication shall be in substantially the following form:
This is one of the Notes described in the within-mentioned Indenture.
DATED: U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
---------------------------------------
Authorized Signatory
SECTION 2.03. Notes Issuable in Global Form. Except as otherwise provided in
this Section 2.03 or in Section 3.04, the Notes shall be issuable only in global
form and deposited with the Trustee, at its Corporate Trust Office (or such
other location as it may determine from time to time for such purpose), as
custodian for the depositary or the nominees thereof, and any such Note shall
represent such of the Outstanding Notes as shall be set forth in the books and
records of the Trustee and may provide that it shall represent the aggregate
amount of Outstanding Notes from time to time as adjusted in the books and
records of the Trustee, and that the aggregate amount of Outstanding Notes
represented thereby may from time to time be increased or decreased to reflect
exchanges. Any adjustment of the aggregate amount of Outstanding Notes
represented by a Note in global form to reflect the amount, or any increase or
decrease in the amount, of Outstanding Notes represented thereby shall be made
by the Trustee in such manner and upon instructions given by such Person or
Persons as shall be specified therein or in the Company Order to be delivered to
the
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Trustee pursuant to Section 3.03. Subject to the provisions of Section 3.03, the
Trustee shall, if required, deliver and redeliver any Note in global form in the
manner and upon instructions given by the Person or Persons specified therein or
in the applicable Company Order. If a Company Order pursuant to Section 3.03 has
been, or simultaneously is, delivered, any instructions by the Company with
respect to endorsement or delivery or redelivery of a Note in global form shall
be in writing but need not comply with Section 1.03 and need not be accompanied
by an Opinion of Counsel.
The provisions of the last sentence of Section 3.03 shall apply to any Note
represented by a Note in global form if such Note was never issued and sold by
the Company and the Company delivers to the Trustee the Note in global form
together with written instructions (which need not comply with Section 1.03 and
need not be accompanied by an Opinion of Counsel) with regard to the reduction
in the principal amount of Notes represented thereby, together with the written
statement contemplated by the last sentence of Section 3.03.
Notwithstanding the provisions of Section 3.07, payment of principal of and any
premium and interest on any Note in global form shall be made to the Person or
Persons specified in such Note.
All Notes issued in global form shall bear the following legend:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL BECAUSE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE.
ARTICLE 3
THE NOTES
SECTION 3.01. Title and Term. The Notes shall be and are hereby authorized to be
designated as "6% Convertible Plus Cash NotesSM due 2007", limited in aggregate
original principal amount up to $100,000,000. The Notes shall mature and the
principal thereof shall be due and payable, together with all accrued and unpaid
interest thereon, on August [ ], 2007. The Notes shall be convertible into
shares of Common Stock as set forth herein.
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SECTION 3.02. Denominations. The Notes shall be issuable in denominations of
$1,000 and any integral multiple thereof.
SECTION 3.03. Execution, Authentication, Delivery and Dating. The Notes shall be
executed on behalf of the Company by the Chief Executive Officer, the Chief
Financial Officer, the Treasurer, the President or a Vice President of the
Company. The signature of any of these individuals on the Notes may be a manual
or facsimile signature of such authorized officer and may be imprinted or
otherwise reproduced on the Notes.
Notes bearing the manual or facsimile signatures of an individual who was at any
time the proper officer of the Company shall bind the Company, notwithstanding
that such individual shall have ceased to hold such office prior to the
authentication and delivery of such Notes or did not hold such office at the
date of such Notes.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Notes, executed by the Company, to the
Trustee for authentication, together with a Company Order for the authentication
and delivery of such Notes, and the Trustee in accordance with the Company Order
shall authenticate and deliver such Notes.
Each Note shall be dated the date of its authentication.
No Note shall be entitled to any benefit under this Indenture or be valid or
obligatory for any purpose unless there appears on such Note a certificate of
authentication substantially in the form provided for in Section 2.02, duly
executed by the Trustee by manual signature of an authorized signatory, and such
certificate upon any Note shall be conclusive evidence, and the only evidence,
that such Note has been duly authenticated and delivered hereunder and is
entitled to the benefits of this Indenture. Notwithstanding the foregoing, if
any Note shall have been authenticated and delivered hereunder but never issued
and sold by the Company, and the Company shall deliver such Note to the Trustee
for cancellation as provided in Section 3.08 together with a written statement
(which need not comply with Section 1.03 and need not be accompanied by an
Opinion of Counsel) stating that such Note has never been issued and sold by the
Company, for all purposes of this Indenture, such Note shall be deemed not to
have been authenticated and delivered hereunder and shall never be entitled to
the benefits of this Indenture.
SECTION 3.04. Registration, Registration of Transfer and Exchange.
(a) The Company shall cause to be kept at the Corporate Trust Office of
the Trustee or in any office or agency of the Company in a Place of Payment a
register for the Notes (the "Note Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of the Notes and of transfers of the Notes. The Note Register shall
be in written form or any other form capable of being converted into written
form within a reasonable time. The Trustee, at its Corporate Trust Office, is
hereby appointed "Note Registrar" for the purpose of registering the Notes and
transfers of the Notes on such Note Register as herein provided. In the event
that the Trustee shall cease to be Note Registrar, it shall have the right to
examine the Note Register at all reasonable times.
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Subject to the provisions of this Section 3.04 and except as otherwise provided
in any Note, including any legend thereon, upon surrender for registration of
transfer of any Note at any office or agency of the Company in a Place of
Payment, 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, bearing a number not contemporaneously outstanding, and containing
identical terms and provisions.
Subject to the provisions of this Section 3.04, at the option of the Holder, the
Notes may be exchanged for other Notes, of any authorized denomination or
denominations and of a like aggregate principal amount, containing identical
terms and provisions, upon surrender of the Notes to be exchanged at any such
office or agency. Whenever any such Notes are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the Notes
that the Holder making the exchange is entitled to receive.
Notwithstanding the foregoing, any global Note shall be exchangeable only as
provided in this paragraph. The depositary for the global Notes shall be DTC,
and the global Notes may be transferred, in whole but not in part, only to a
nominee of DTC, or by a nominee of DTC to DTC, or to a successor to DTC for such
global Note selected or approved by the Company or to a nominee of such
successor to DTC. If at any time DTC notifies the Company that it is unwilling
or unable to continue as depositary for the applicable global Note or Notes or
if at any time DTC ceases to be a clearing agency registered under the Exchange
Act, if so required by applicable law or regulation, the Company shall appoint a
successor depositary with respect to such global Note or Notes. If (x) a
successor depositary for such global Note or Notes is not appointed by the
Company within 90 days after the Company receives such notice or becomes aware
of such unwillingness, inability or ineligibility, or (y) a Default or an Event
of Default has occurred and is continuing, or (z) the Company, in its sole
discretion, executes and delivers to the Trustee and the Note Registrar an
Officers' Certificate stating that definitive Notes may be issued in exchange
for interests in a global Note or Notes, then the Company shall execute, and the
Trustee shall authenticate and deliver, definitive Notes of like rank, tenor and
terms in definitive form, registered in such names as DTC shall direct and
bearing such legends as the Company shall specify in writing, in an aggregate
principal amount equal to the principal amount of such global Note or Notes. If
a Note is issued in exchange for any portion of a global Note after the close of
business at the office or agency where such exchange occurs on (i) any Regular
Record Date and before the opening of business at such office or agency on the
relevant Interest Payment Date or (ii) any Special Record Date and before the
opening of business at such office or agency on the related proposed date for
payment of Defaulted Interest, interest or Defaulted Interest, as the case may
be, shall not be payable on such Interest Payment Date or proposed date for
payment, as the case may be, in respect of such Note, but will be payable on
such Interest Payment Date or proposed date for payment, as the case may be,
only to the Person to whom interest in respect of such portion of such global
Note is payable in accordance with the provisions of this Indenture.
All Notes issued upon any registration of transfer or exchange of Notes 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.
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Every Note presented or surrendered for registration of transfer or for exchange
or redemption shall (if so required by the Company or the Note Registrar) be
duly endorsed, or be accompanied by a written instrument of transfer, in form
satisfactory to the Company and the Note Registrar, duly executed by the Holder
thereof or his attorney duly authorized in writing.
No service charge shall be made to a Holder for any registration of transfer or
exchange of Notes, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Notes, other than exchanges
pursuant to Section 10.07 or 11.02(h) not involving any transfer.
The Company or the Trustee, as applicable, shall not be required (i) to issue,
register the transfer of or exchange any Note during a period beginning at the
opening of business 15 days before the date of the mailing of a notice of
redemption with respect to the Notes to be redeemed under Section 10.03 and
ending at the close of business on the day of the mailing of the relevant notice
of redemption, or (ii) to register the transfer of or exchange any Note so
selected for redemption in whole or in part, except, in the case of any Note to
be redeemed in part, the portion thereof not to be redeemed, or (iii) to issue,
register the transfer of or exchange any Note that has been surrendered for
repayment at the option of the Holder, except the portion, if any, of such Note
not to be so repaid.
(b) At such time as all interests in the global Note have been
redeemed, converted, canceled, repurchased or transferred, the global Note shall
be, upon receipt thereof, canceled by the Trustee in accordance with standing
procedures and instructions existing between the depositary and the Custodian.
SECTION 3.05. Mutilated, Destroyed, Lost and Stolen Notes. If any mutilated Note
is surrendered to the Trustee or the Company, together with such security or
indemnity as may be required by the Company or the Trustee to save each of them
or any agent of either of them harmless, the Company shall, at the relevant
Holder's expense, execute and the Trustee shall authenticate and deliver in
exchange therefor a new Note of the same principal amount, containing identical
terms and provisions and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and to the Trustee (i) evidence to
their satisfaction of the destruction, loss or theft of any Note and (ii) such
security or indemnity as may be required by them to save each of them and any
agent of either of them harmless, then, in the absence of notice to the Company
or the Trustee that such Note has been acquired by a bona fide purchaser, the
Company, at the relevant Holder's expense, shall execute, and upon the Company's
request the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Note, a new Note of the same principal amount,
containing identical terms and provisions and bearing a number not
contemporaneously outstanding, appertaining to such destroyed, lost or stolen
Note.
Notwithstanding the provisions of the previous two paragraphs, in case any such
mutilated, destroyed, lost or stolen Note has become or is about to become due
and payable, the Company in its discretion may, instead of issuing a new Note,
pay such Note.
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Upon the issuance of any new Note under this Section, 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 (including the
fees and expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section in lieu of any mutilated,
destroyed, lost or stolen Note, shall constitute an original additional
contractual obligation of the Company, whether or not the mutilated, destroyed,
lost or stolen Note shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Notes.
SECTION 3.06. Payment of Interest; Interest Rights Preserved. Interest on any
Note that is payable, and is punctually paid or duly provided for, semi-annually
on any June 30 and December 31 of each year (each such date, an "Interest
Payment Date"), shall be paid or duly provided for commencing December 31, 2003
to the Person in whose name that Note (or one or more Predecessor Notes) is
registered at the close of business on the Regular Record Date for such interest
at the office or agency of the Company maintained for such purpose pursuant to
Section 9.02; provided, however, that each installment of interest on any Note
may at the Company's option be paid or provided for by (i) mailing a check for
such interest, payable to or upon the written order of the Person entitled
thereto pursuant to Section 3.07, to the address of such Person as it appears on
the Note Register or (ii) if the Trustee shall have received written bank wire
instructions prior to the Regular Record Date for such payment, transfer to an
account maintained by the payee located inside the United States; provided,
however, that payments to the depositary shall be made by wire transfer of
immediately available funds to the account of the depositary or its nominee. The
term "Regular Record Date" with respect to any Interest Payment Date shall mean
the June 15 or December 15 preceding June 30 or December 31, respectively.
Notwithstanding the foregoing, interest may be paid or duly provided for in
shares of the Company's Common Stock, solely at the Company's option; provided,
however, that the Company shall not make any payment of interest in shares of
Common Stock unless the daily volume-weighted average price of the Common Stock
for the ten (10) Trading Days ending on and including the second Trading Day
immediately preceding the applicable Interest Payment Date equals or exceeds the
Threshold Price. If the Company elects to make any payment of or provision for
interest in shares of its Common Stock, the shares to be delivered will be
valued at 95% of the simple average of the daily volume-weighted average price
of the Common Stock for the ten (10) Trading Days ending on and including the
second Trading Day immediately preceding the applicable Interest Payment Date.
The Company shall provide the Trustee and the holders with notice of its
intention to pay interest in Common Stock not later than 12:00 noon (New York
City time) on the Trading Day immediately preceding the applicable Interest
Payment Date. The Company shall not issue fractional shares of Common Stock or
any scrip representing fractional shares of Common Stock
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upon such payment of interest. If any fractional share of Common Stock otherwise
would be issuable upon the payment of or provision for interest, the Company, at
its option, may either make an adjustment therefore in cash at the current
market value thereof to the holder of the Notes or round the fractional shares
up to the nearest whole share. For these purposes, the current market value of a
share of Common Stock shall be the Closing Price on the first Trading Day
immediately preceding the applicable Interest Payment Date and such Closing
Price shall be determined as provided in Section 12.03. The Threshold Price and
any calculation or determination in respect of the simple average of the daily
volume-weighted average price of the Common Stock shall be adjusted as provided
for in Section 12.04.
Any interest on any Note that is payable, but is not punctually paid or duly
provided for, on any Interest Payment Date (herein called "Defaulted Interest")
shall forthwith cease to be payable to the registered Holder thereof on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in clause 3.06(a) or 3.06(b) below:
(a) 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
proposed to be paid on each Note and the date of the proposed payment (which
shall not be less than 30 days after such notice is received by the Trustee) and
at the same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for such deposit
on or 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 Company shall fix a Special Record
Date for the payment of such Defaulted Interest which shall be not more than 15
days and not less than 10 days prior to the date of the proposed payment. The
Company shall promptly notify the Trustee of such Special Record Date and, in
the name and at the expense of the Company, the Trustee 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 of Notes at
his address as it appears in the Note Register not less than 10 days prior to
such Special Record Date. The Trustee may, in its discretion, in the name and at
the expense of the Company, cause a similar notice to be published at least once
in an Authorized Newspaper in each Place of Payment, but such publications shall
not be a condition precedent to the establishment of such Special Record Date.
Notice of the proposed payment of such Defaulted Interest and the Special Record
Date therefor having been mailed as aforesaid, such Defaulted Interest shall be
paid to the Persons in whose names the Notes (or their respective Predecessor
Notes) are registered at the close of business on such Special Record Date and
shall no longer be payable pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest on the Notes
in any other lawful manner not inconsistent with the requirements of any
securities exchange on which such Notes may be listed, and upon such notice as
may be required by such exchange, if, after notice
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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.
(c) Subject to the foregoing provisions of this Section, each Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Note shall carry the rights to interest accrued and
unpaid, and to accrue, which were carried by such other Note.
SECTION 3.07. Persons Deemed Owners. Prior to due presentment of a Note for
registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name such Note is registered as the
owner of such Note for the purpose of receiving payment of principal of (and
premium, if any), and (subject to Sections 3.04 and 3.06) interest on, such Note
and for all other purposes whatsoever, whether or not such Note is overdue, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.
None of the Company, the Trustee, any Paying Agent or the Note Registrar shall
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests of a Note in
global form or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
Notwithstanding the foregoing, with respect to any global Note, nothing herein
shall prevent the Company, the Trustee, or any agent of the Company or the
Trustee, from giving effect to any written certification, proxy or other
authorization furnished by any depositary, as a Holder, with respect to such
global Note or impair, as between such depositary and owners of beneficial
interests in such global Note, the operation of customary practices governing
the exercise of the rights of such depositary (or its nominee) as a Holder of
such global Note.
SECTION 3.08. Cancellation. All Notes surrendered for payment, redemption,
repayment at the option of the Holder, repurchase, conversion, or registration
of transfer or exchange shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee, and any such Notes surrendered directly to
the Trustee for any such purpose shall be promptly canceled by it. The Company
may at any time deliver to the Trustee for cancellation any Notes previously
authenticated and delivered hereunder that the Company may have acquired in any
manner whatsoever, and may deliver to the Trustee (or to any other Person for
delivery to the Trustee) for cancellation any Notes previously authenticated
hereunder that the Company has not issued and sold, and all Notes so delivered
shall be promptly canceled by the Trustee. If the Company shall so acquire any
of the Notes, however, such acquisition shall not operate as a redemption or
satisfaction of the indebtedness represented by such Notes unless and until the
same are surrendered to the Trustee for cancellation. No Notes shall be
authenticated in lieu of or in exchange for any Notes canceled as provided in
this Section, except as expressly permitted by this Indenture. Canceled Notes
held by the Trustee shall be destroyed by the Trustee and the Trustee shall
deliver a certificate of such destruction to the Company, unless by a Company
Order the Company directs their return to it.
SECTION 3.09. Computation of Interest. Interest on the Notes shall be computed
on the basis of a 360-day year consisting of twelve 30-day months.
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SECTION 3.10. CUSIP Numbers. The Company in issuing the Notes shall use "CUSIP"
numbers, and the Trustee shall use CUSIP numbers in notices of redemption as a
convenience to Holders; provided however, that any such notice may state that no
representation is made as to the correctness of such numbers either as printed
on the Notes or as contained in any notice of a redemption and that reliance may
be placed only on the other identification numbers printed on the Notes, and any
such redemption shall not be affected by any defect in or omission of such
numbers. The Company shall promptly notify the Trustee of any change in the
CUSIP numbers applicable to the Notes.
ARTICLE 4
REMEDIES
SECTION 4.01. Events of Default. "Event of Default," wherever used herein with
respect to the Notes, means any one of the following events (whatever the reason
for such Event of Default and whether or not 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):
(a) default in the payment of any interest upon any Note, when such
interest becomes due and payable, and continuance of such default for a period
of 30 days; or
(b) default in the payment of (i) the principal of (or premium, if any,
on) any Note when it becomes due and payable at its Maturity, or (ii) the
Redemption Price with respect to any Note when it becomes due and payable; or
(c) default in the payment of the Repurchase Price in respect of any
Note on the Repurchase Date therefor (whether or not a Person other than the
Company has offered to repurchase Outstanding Notes as contemplated by Section
11.02(j)); or
(d) failure by the Company to give the Company Notice in accordance
with Section 11.02(a) to all Holders of Outstanding Notes and to the Trustee; or
(e) failure by the Company to deliver the Base Shares, the Plus Cash
Amount or the Plus Cash Shares, the Make-Whole Payment amount or the Make-Whole
Shares, together with cash in lieu of fractional shares, in each case, as
applicable, required to be delivered following conversion (including Automatic
Conversion) of a Note and continuation of such default for a period of 10 days;
or
(f) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture with respect to any Note (other than a covenant
or warranty a default in whose performance or whose breach is elsewhere in this
Section specifically dealt with) and continuance of such default or breach for a
period of 60 days after there has been given, by registered or certified mail,
to the Company by the Trustee or to the Company and the Trustee by the Holders
of at least 25% in principal amount of the Outstanding Notes a written notice
specifying
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such default or breach and requiring it to be remedied and stating that such
notice is a "Notice of Default" hereunder; or
(g) a default under any bonds, debentures, notes or other evidences of
indebtedness for money borrowed of the Company or under any mortgages,
indentures or instruments under which there may be issued or by which there may
be secured or evidenced any indebtedness for money borrowed by the Company,
whether such indebtedness now exists or shall hereafter be created, which
indebtedness, individually or in the aggregate, has a principal amount
outstanding in excess of $10,000,000, which default shall have resulted in such
indebtedness becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, without such indebtedness
having been discharged, or such acceleration having been rescinded or annulled,
within a period of 60 days after there shall have been given, by registered or
certified mail, to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% in principal amount of the Notes then
Outstanding, a written notice specifying such default and requiring the Company
to cause such indebtedness to be discharged or cause such acceleration to be
rescinded or annulled and stating that such notice is a "Notice of Default"
hereunder (unless such default has been cured or waived); or
(h) the Company or any Significant Subsidiary pursuant to or within the
meaning of any Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it
in an involuntary case,
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property, or
(iv) makes a general assignment for the benefit of its
creditors; or
(i) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(i) is for relief against the Company or any Significant
Subsidiary in an involuntary case,
(ii) appoints a Custodian of the Company or any Significant
Subsidiary or for all or substantially all of the property of any of
them, or
(iii) orders the winding up or liquidation of the Company or
any Significant Subsidiary,
and the order or decree remains unstayed and in effect for 60 days.
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As used in this Section 4.01 only, the term "Bankruptcy Law" means title 11,
U.S. Code or any similar Federal or State law for the relief of debtors and the
term "Custodian" means any receiver, trustee, assignee, liquidator or other
similar official under any Bankruptcy Law.
SECTION 4.02. Acceleration of Maturity; Rescission and Annulment. If an Event of
Default with respect to Notes at the time Outstanding occurs and is continuing,
then and in every such case the Trustee, or the Holders of not less than 25% in
principal amount of the Outstanding Notes, may declare the principal of all the
Notes, and accrued interest thereon to the date of such declaration, to be due
and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by the Holders), and upon any such declaration such principal
shall become immediately due and payable. If an Event of Default specified in
Section 4.01(h) or Section 4.01(i) occurs, the principal of, and accrued
interest on, all the Notes shall automatically, and without any declaration or
other action on the part of the Trustee or any Holder, become immediately due
and payable.
At any time after such a declaration of acceleration with respect to the Notes
has been made and before a judgment or decree for payment of the money due has
been obtained by the Trustee as hereinafter provided in this Article, the
Holders of a majority in principal amount of the Outstanding Notes, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if:
(a) the Company has paid or deposited with the Trustee a sum sufficient
to pay:
(i) all overdue installments of interest on all Outstanding
Notes,
(ii) the principal of (and premium, if any, on) any
Outstanding Notes that have become due otherwise than by reason of such
declaration of acceleration and interest thereon at the rate or rates
borne by or provided for in such Notes,
(iii) to the extent that payment of such interest is lawful,
interest upon overdue installments of interest at the rate or rates
borne by or provided for in such Notes, and
(iv) all sums paid or advanced by the Trustee hereunder and
the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel; and
(b) all Events of Default with respect to the Notes, other than the
nonpayment of the principal of (or premium, if any) or interest on Notes which
have become due solely by reason of such declaration of acceleration, have been
cured or waived as provided in Section 4.13.
No such rescission shall affect any subsequent Default or Event of Default or
impair any right in respect thereof.
SECTION 4.03. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if:
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(a) default is made in the payment of any installment of interest on
any Note when such interest becomes due and payable and such default continues
for a period of 30 days, or
(b) default is made in the payment of the principal of (or premium, if
any, on) any Note at its Maturity,
then the Company shall, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Notes, the whole amount then due and payable on
such Notes for principal (and premium, if any) and interest, with interest upon
any overdue principal (and premium, if any) and, to the extent that payment of
such interest shall be legally enforceable, upon any overdue installments of
interest, at the rate or rates borne by or provided for in such Notes, and, in
addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon such Notes under a supplemental
indenture entered into in accordance herewith and collect the moneys adjudged or
decreed to be payable in the manner provided by law out of the property of the
Company or any other such obligor upon such Notes, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders of Notes by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 4.04. Trustee May File Proofs of Claim. In case of the pendency of any
receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement,
adjustment, composition or other judicial proceeding relative to the Company or
any other obligor upon the Notes under a supplemental indenture entered into in
accordance herewith or the property of the Company or of such other obligor or
the Company's, or any such other obligor's, creditors, the Trustee (irrespective
of whether the principal of the Notes shall then be due and payable as therein
expressed or by acceleration or otherwise and irrespective of whether the
Trustee shall have made any demand on the Company for the payment of overdue
principal, premium, if any, or interest) shall be entitled and empowered, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount, or such lesser
amount as may be provided for in the Notes, of principal (and premium, if any)
and interest, owing and unpaid in respect of the Notes and to file such other
papers or documents as may be necessary or advisable in order to have the claims
of the Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and of the
Holders allowed in such judicial proceeding, and
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(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator (or
other similar official) in any such judicial proceeding is hereby directed by
each Holder to make such payments to the Trustee, and in the event that the
Trustee shall request or consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee and any
predecessor Trustee, their agents and counsel, and any other amounts due the
Trustee or any predecessor Trustee under Section 5.07.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Holder of a Note, any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder of a Note 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 be a member of a creditors' or
other similar committee.
SECTION 4.05. Trustee May Enforce Claims Without Possession of Notes. All rights
of action and claims under this Indenture or any of the Notes may be prosecuted
and enforced by the Trustee without the possession of any of the Notes or the
production thereof in any proceeding relating thereto, and any such 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 respect of which such judgment has been recovered.
SECTION 4.06. Application of Money Collected. Any money collected by the Trustee
pursuant to this Article shall be applied in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution of such money on
account of principal (or premium, if any) or interest, upon presentation of the
Notes, or both, as the case may be, and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee and any predecessor Trustee
under Section 5.07;
SECOND: To the payment of the amounts then due and unpaid upon the Notes for
principal (and premium, if any) and interest payable, and any other amounts due
and payable under this Indenture or under the Notes in respect of which or for
the benefit of which such money has been collected, ratably, without preference
or priority of any kind, according to the aggregate amounts due and payable on
such Notes for principal (and premium, if any) and, interest, respectively; and
THIRD: To the payment of the remainder, if any, to the Company.
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SECTION 4.07. Limitation on Suits. No Holder of any Note shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless:
(a) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Notes;
(b) the Holders of not less than 25% in principal amount of the
Outstanding Notes shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
hereunder;
(c) such Holder or Holders have offered to the Trustee security or
indemnity reasonably satisfactory to the Trustee against the costs, expenses and
liabilities to be incurred in compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request
and offer of security or indemnity has failed to institute any such proceeding;
and
(e) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Notes;
it being understood and intended that no one or more of such Holders 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 of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all such
Holders.
SECTION 4.08. Unconditional Right of Holders to Receive Principal, Premium, If
Any, and Interest. 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, and premium, if any, including the
Redemption Price pursuant to Article 10, the Repurchase Price pursuant to
Article 11 and (subject to Sections 3.04 and 3.06) interest on such Note on the
respective due dates 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 the provisions of this Indenture and to
institute suit for the enforcement of any such payment and right to convert, and
such rights shall not be impaired or adversely affected without the consent of
such Holder.
SECTION 4.09. Restoration of Rights and Remedies. If the Trustee or any Holder
of a Note has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case, the Company, the Trustee and the Holders of Notes shall,
subject to any determination in such proceeding, be restored severally and
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respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 4.10. Rights and Remedies Cumulative. Except as otherwise provided with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Notes in the last paragraph of Section 3.05, no right or remedy herein conferred
upon or reserved to the Trustee or to the Holders of Notes is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 4.11. 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 an acquiescence therein. Every right and remedy
given by this Article or by law to the Trustee or to the Holders 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.
SECTION 4.12. Control by Holders of Notes. The Holders of not less than a
majority in principal amount of the Outstanding Notes 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 with respect to the Notes, provided that:
(a) such direction shall not be in conflict with any rule of law or
with this Indenture,
(b) the Trustee may take any other action deemed proper by the Trustee
that is not inconsistent with such direction, and
(c) the Trustee need not take any action that might involve it in
personal liability or be unduly prejudicial to the Holders of Notes not joining
therein.
SECTION 4.13. Waiver of Past Defaults. The Holders of not less than a majority
in principal amount of the Outstanding Notes may on behalf of the Holders of all
the Notes waive any past Default or Event of Default hereunder with respect to
such Notes and its consequences, except a Default or Event of Default:
(a) in the payment of the principal of (or premium, if any) or interest
on any Note;
(b) in respect of the conversion by the Company of any Note into Common
Stock;
(c) in the payment of the Redemption Price pursuant to Article 10;
(d) in the payment of the Repurchase Price pursuant to Article 11;
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(e) in respect of a covenant or provision hereof that under Article 8
cannot be modified or amended without the consent of the Holder of each
Outstanding Note affected; or
(f) in respect of a covenant or provision hereof for the personal
protection or benefit of the Trustee, without the consent of the Trustee.
Upon any such waiver, such Default or Event of Default shall cease to exist, and
any Event of Default arising from any such Default shall be deemed to have been
cured, for every purpose of this Indenture; but no such waiver shall extend to
any subsequent or other Default or Event of Default or impair any right
consequent thereon.
SECTION 4.14. Waiver of Usury, Stay or Extension Laws. The Company covenants (to
the extent that it may lawfully do so) that it shall not at any time insist
upon, or plead, or in any manner whatsoever claim or take the benefit or
advantage of, any usury, stay or extension law wherever enacted, now or at any
time hereafter in force, which may affect the covenants or the performance of
this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it shall not 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 had been enacted.
SECTION 4.15. Undertaking for 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; but the provisions of this Section 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
Outstanding Notes, 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 respective Stated Maturities expressed in such Note (or, in the
case of redemption or repurchase, on or after the Redemption Date or the
Repurchase Date, respectively), or the right to convert any Note in accordance
with Article 12.
ARTICLE 5
THE TRUSTEE
SECTION 5.01. General. The Trustee, prior to the occurrence of an Event of
Default known to a Responsible Officer of the Trustee and after the curing of
all Events of Default that 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 (that has not been cured or waived) and is known
to a Responsible Officer of the Trustee, the Trustee shall exercise such of the
rights and powers vested in it by this Indenture, and use the same degree of
care and skill in their exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs.
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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, its
own willful misconduct, its own recklessness or its own bad faith.
SECTION 5.02. Certain Rights of Trustee. Subject to TIA Sections 315(a) through
(d):
(a) the Trustee may rely, and shall be protected in acting or
refraining from acting, upon any resolution, certificate, statement, instrument,
facsimile transmission, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed, made or presented
by the proper person, and may accept and rely upon the same as conclusive
evidence of the truth and accuracy of the statements and opinions contained
therein. The Trustee need not investigate any fact or matter stated in any such
document;
(b) before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel, which shall conform to Section
1.03. The Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on such certificate or opinion;
(c) the Trustee may consult with counsel, and the written advice of
such counsel shall be full and complete authorization and protection with
respect to any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon, and may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any attorney or agent
appointed with due care;
(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 or direction of
any of the Holders, unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in complying with such request or direction;
(e) the Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within its rights or
powers or for any action it takes or omits to take in accordance with the
written direction of the holders of a majority in principal amount of the
Outstanding Notes 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;
(f) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(g) 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,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or
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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;
(h) the Trustee shall not be required to take notice or be deemed to
have notice of any Default or Event of Default unless the Trustee be
specifically notified of such Default or Event of Default in writing by the
Company or any Holder, and in the absence of such notice the Trustee may
conclusively assume that there is no Default or event of Default; provided that
if the Trustee is acting as Paying Agent, the Trustee shall be required to take
and be deemed to have notice of its failure to receive payments of interest or
principal hereunder;
(i) the Trustee shall have no responsibility with respect to any
information in any offering memorandum or other disclosure material distributed
with respect to the Notes, and the Trustee shall have no responsibility for
compliance with securities laws in connection with the issuance and sale,
resale, transfer or exchange of the Notes;
(j) in the event the Trustee shall receive inconsistent or conflicting
requests and security or indemnity from two or more groups of Holders, each
representing at least 25% (but less than 50%) of the aggregate principal amount
of the Notes then Outstanding, the Trustee shall act in accordance with
instructions received by the Holders of the greater percentage thereof;
(k) except as otherwise expressly provided by the provisions of this
Indenture, the Trustee shall not be obligated, and may not be required to give
or furnish any notice, demand, report, request, reply, statement, advice or
opinion to any Holder or to the Company or any other Person, and the Trustee
shall not incur any liability for its failure or refusal to give or furnish the
same unless obligated or required to do so by the express provisions hereof;
(l) the Trustee shall not be required to give any bond or surety with
respect to the performance of its duties or the exercise of its powers under
this Indenture; and
(m) any permissive power or authority granted to the Trustee shall not
be construed to be a duty.
SECTION 5.03. Individual Rights of Trustee. The Trustee, any Paying Agent, Note
Registrar or any other agent of the Company, in its individual or any other
capacity, may become the owner or pledgee of Notes and may otherwise deal with
the Company, its Subsidiaries or its Affiliates with the same rights it would
have if it were not the Trustee, Paying Agent, Note Registrar or such other
agent. Any registrar, co-registrar, paying agent, conversion agent or
authenticating agent may do the same with like rights. However, upon
qualification of this Indenture under the TIA, the Trustee shall be subject to
TIA Sections 310(b) and 311.
SECTION 5.04. Trustee's Disclaimer. The Trustee (i) makes no representation as
to the validity or adequacy of this Indenture, the Notes or the offering
documents relating to the Notes, (ii) shall not be accountable for the Company's
use or application of the proceeds from the Notes
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and (iii) shall not be responsible for any statement in the Notes other than its
certificate of authentication.
SECTION 5.05. Notice of Default. If any Event of Default occurs and is
continuing and if a Responsible Officer of the Trustee has actual knowledge of
such Event of Default, the Trustee shall mail to each holder in the manner and
to the extent provided in TIA Section 313(c) notice of the Event of Default
within 90 days after it occurs, unless such Event of Default has been cured or
waived; provided, however, that, except in the case of a Default in the payment
of the principal of (or premium, if any) or interest on any Note, the Trustee
shall be protected in withholding such notice if and so long as Responsible
Officers of the Trustee in good faith determine that the withholding of such
notice is in the interests of the Holders of the Notes.
SECTION 5.06. Conflicting Interests of Trustee. If the Trustee has or shall
acquire a conflicting interest within the meaning of the TIA, 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 TIA and this Indenture.
SECTION 5.07. Compensation and Indemnity. The Company shall pay to the Trustee
such compensation as shall be agreed upon in writing for its services. The
compensation of the Trustee shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses, disbursements and advances
incurred or made by the Trustee in accordance with this Indenture. Such expenses
shall include the reasonable compensation, expenses, disbursements and advances
of the Trustee's agents and counsel.
The Company shall indemnify and hold harmless the Trustee and its directors,
agents and employees (including officers) (collectively the "Indemnitees")
against any and all losses, liabilities, obligations, damages, penalties, fines,
judgments, actions, suits, proceedings, reasonable costs and expenses (including
reasonable fees and disbursements of counsel) of any kind whatsoever that may be
incurred by or imposed on the Indemnitees or any of them arising out of or in
connection with the acceptance or administration of the Trustee's duties under
this Indenture; provided, however, that the Company need not reimburse any
expense or indemnify against any loss, obligation, damage, penalty, fine,
judgment, action, suit, proceeding, reasonable cost or expense (including
reasonable fees and disbursements of counsel) of any kind whatsoever that may be
incurred by Indemnitees or any of them which results from the negligence or
willful misconduct of the Indemnitees or any of them. The Trustee shall notify
the Company promptly of any claim for which it may seek indemnity. Failure by
the Trustee to so notify the Company shall not relieve the Company of its
obligations hereunder, unless the Company is materially prejudiced thereby. The
Company shall defend the claim, and the Trustee shall cooperate in the defense.
Unless otherwise set forth herein, the Indemnitees or any of them, may have
separate counsel and the Company shall pay the reasonable fees and expenses of
such counsel. The Company need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld. The provisions of
this Section 5.07 shall survive the termination of this Indenture and the
resignation or removal of the Trustee for any reason, including any termination
under any bankruptcy law.
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To secure the Company's payment obligations in this Section 5.07, the Trustee
shall have a lien prior to the Notes on all money or property held or collected
by the Trustee, in its capacity as Trustee, except money or property held in
trust to pay principal of, premium, if any, and interest on particular Notes.
If the Trustee incurs expenses or renders services after the occurrence of an
Event of Default specified in Section 4.01(h) or Section 4.01(i), such expenses,
and the compensation due to the Trustee for such services, are intended to
constitute expenses of administration under Title 11 of the United States
Bankruptcy Code or any applicable federal or state law for the relief of
debtors.
SECTION 5.08. Replacement of Trustee. A resignation or removal of the Trustee
and appointment of a successor Trustee shall become effective only upon the
successor Trustee's acceptance of appointment as provided in this Section 5.08.
The Trustee may resign at any time by so notifying the Company in writing at
least thirty days prior to the date of the proposed resignation. The Holders of
a majority in principal amount of the Outstanding Notes may at any time, by
written notice to the Trustee and the Company, remove the Trustee and, with the
prior consent of the Company, appoint a successor Trustee. The Company may
remove the Trustee if: (i) the Trustee is no longer eligible under Section 5.10;
(ii) the Trustee is adjudged a bankrupt or an insolvent; (iii) a receiver or
other public officer takes charge of the Trustee or its property; or (iv) the
Trustee becomes incapable of acting.
If the Trustee is removed without the concurrent appointment by the Holders of a
successor Trustee, if the Trustee resigns, or if a vacancy exists in the office
of Trustee for any other reason, the Company shall promptly appoint a successor
Trustee. If no successor Trustee has delivered its written acceptance required
by the next succeeding paragraph of this Section 5.08 within thirty days after
the retiring Trustee delivers notice of its resignation or is removed, or after
the occurrence of a vacancy in the office of Trustee for any other reason, the
retiring Trustee, the Company or the Holders of a majority in principal amount
of the Outstanding Notes may petition any court of competent jurisdiction for
the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment to the
retiring Trustee and to the Company. Immediately after the delivery of such
written acceptance, subject to the lien provided in Section 5.07, (i) the
retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee, (ii) the resignation or removal of the retiring Trustee shall
become effective and (iii) the successor Trustee shall have all the rights,
powers and duties of the Trustee under this Indenture. A successor Trustee shall
mail notice of its succession to each Holder.
If the Trustee is no longer eligible under Section 5.10, any Holder who
satisfies the requirements of TIA Section 310(b) may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
The Company shall give notice of any resignation and any removal of the Trustee
and each appointment of a successor Trustee to all holders. Each notice shall
include the name of the successor Trustee and the address of its Corporate Trust
Office.
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Notwithstanding replacement of the Trustee pursuant to this Section 5.08, the
Company's obligations under Section 5.07 shall continue for the benefit of the
retiring Trustee.
SECTION 5.09. Successor Trustee by Merger, Etc. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all of its
corporate trust business (including the administration of this Indenture) to,
another corporation or national banking association, the resulting, surviving or
transferee corporation or national banking association, without any further act,
shall be the successor Trustee with the same effect as if the successor Trustee
had been named as the Trustee herein.
SECTION 5.10. Eligibility. This Indenture shall always have a Trustee who
satisfies the requirements of TIA Section 310(a)(1). The Trustee (or the bank
holding company to which the Trustee is a member) shall have a combined capital
and surplus of at least $25 million as set forth in its most recent published
annual report of condition.
SECTION 5.11. Money Held in Trust. Subject to the provisions of Section 9.03,
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. The
Trustee shall not be liable for interest on any money received by it except as
the Trustee may agree with the Company. Money held in trust by the Trustee need
not be segregated from other funds except to the extent required by law.
SECTION 5.12. Preferential Collection of Claims. If and when the Trustee shall
be or become a creditor of the Company (or any other obligor upon the Notes
under a supplemental indenture entered into in accordance herewith), 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).
SECTION 5.13. Trustee's Application for Instructions from the Company. Any
application by the Trustee for written instructions from the Company (other than
with regard to any action proposed to be taken or omitted to be taken by the
Trustee that affects the rights of the Holders) may, at the option of the
Trustee, set forth in writing any action proposed to be taken or omitted by the
Trustee under this Indenture and the date on and/or after which such action
shall be taken or such omission shall be effective. The Trustee shall not be
liable for any action taken by, or omission of, the Trustee in accordance with a
proposal included in such application on or after the date specified in such
application (which date shall not be less than ten Business Days after the date
any officer of the Company actually receives such application, unless any such
officer shall have consented in writing to any earlier date) unless prior to
taking any such action (or the effective date in the case of an omission), the
Trustee shall have received written instructions in response to such application
specifying the action to be taken or omitted.
ARTICLE 6
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 6.01. Disclosure of Names and Addresses of Holders. Every Holder of
Notes, by receiving and holding the same, agrees with the Company and the
Trustee that none of the
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Company, the Trustee, any Paying Agent or any Note Registrar, shall be held
accountable by reason of the disclosure of any information as to the names and
addresses of the Holders of Notes in accordance with TIA Section 312, regardless
of the source from which such information was derived, and that the Trustee
shall not be held accountable by reason of mailing any material pursuant to a
request made under TIA Section 312(b).
SECTION 6.02. Reports by Trustee. Within 60 days after October 15 of each year,
commencing with the first October 15 to occur after the qualification of this
Indenture, the Trustee shall transmit by mail to all Holders of Notes as
provided in TIA Section 313(c), if required by TIA Section 313(a), a brief
report dated as of such October 15. A copy of each such report shall at the time
of such transmission to Holders be filed by the Trustee with the Company.
SECTION 6.03. Reports by Company. The Company shall:
(a) file with the Trustee, within 15 days after the Company is required
to file the same with the Commission, copies of the annual reports and of the
information, documents and other reports (or copies of such portions of any of
the foregoing as the Commission may from time to time by rules and regulations
prescribe) that the Company may be required to file with the Commission pursuant
to Sections 13(a) or 13(b) or Section 15(d) of the Exchange Act; or, if the
Company is not required to file information, documents or reports pursuant to
any of such Sections, then it shall file with the Trustee, in accordance with
rules and regulations prescribed from time to time by the Commission, such of
the supplementary and periodic information, documents and reports that may be
required pursuant to Section 13 of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may be prescribed
from time to time in such rules and regulations;
(b) file with the Trustee and the Commission, in accordance with rules
and regulations prescribed from time to time by the Commission, such additional
information, documents and reports with respect to compliance by the Company
with the conditions and covenants of this Indenture as may be required from time
to time by such rules and regulations; and
(c) file with the Trustee and the Commission, if applicable, and
transmit by mail to the Holders, within thirty days after the filing thereof
with the Trustee, in the manner and to the extent provided in TIA Section
313(c), such summaries of any information, documents and reports required to be
filed by the Company pursuant to paragraphs (1) and (2) of this Section as may
be required by rules and regulations prescribed from time to time by the
Commission and sell other information as may be required pursuant to the TIA, at
the time and in the manner provided pursuant to such Act.
SECTION 6.04. Company to Furnish Trustee Names and Addresses of Holders.
(a) The Company shall furnish or cause to be furnished to the Trustee:
(i) semiannually, not later than 10 days after the Regular
Record Date for the payment of interest on the Notes, a list, in such
form as the Trustee may reasonably
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require, of the names and addresses of the Holders as of such Regular
Record Date; and
(ii) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than
15 days prior to the time such list is furnished,
provided, however, that, so long as the Trustee is the Note Registrar, no such
list shall be required to be furnished.
(b) The Company shall provide the Trustee with at least thirty days'
prior notice of any change in location of its principal executive offices or
other principal place of business.
ARTICLE 7
CONSOLIDATION, MERGER, SALE, LEASE OR CONVEYANCE
SECTION 7.01. Consolidations and Mergers of Company and Sales, Leases and
Conveyances Permitted Subject to Certain Conditions. The Company may consolidate
with, or sell, lease, transfer, convey or otherwise dispose of all or
substantially all of its assets to, or merge with or into any other Person,
provided however, that in any such case, (1) either the Company shall be the
continuing corporation, or the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person (if other than a
Subsidiary of the Company) that acquires or leases the Company's assets
substantially as an entirety is a corporation, partnership, limited liability
company or trust organized and existing under the laws of any United States
jurisdiction and expressly assumes the due and punctual payment of the principal
of (and premium, if any) and any interest payable pursuant to this Indenture on
all of the Notes, according to their tenor, and the due and punctual performance
and observance of all of the covenants and conditions of this Indenture to be
performed by the Company and shall have provided for conversion rights, as
appropriately adjusted, if applicable, in accordance with the provisions of
Article 12 hereof, by supplemental indenture, complying with Article 8 hereof,
satisfactory to the Trustee, executed and delivered to the Trustee by such
corporation and (2) immediately after giving effect to such transaction, no
Default or Event of Default, shall have occurred and be continuing. For purposes
of the foregoing, the transfer (by lease, assignment, sale or otherwise) of the
properties and assets of one or more Subsidiaries (other than to the Company or
another Subsidiary), which, if such assets were owned by the Company, would
constitute all or substantially all of the properties and assets of the Company,
shall be deemed to be the transfer of all or substantially all of the properties
and assets of the Company.
SECTION 7.02. Rights and Duties of Successor Corporation. In case of any such
consolidation, merger, sale, lease, conveyance or other disposition and upon any
such assumption by the successor Person, such successor Person 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, and the predecessor corporation, except
in the event of a lease, shall be relieved of any further obligation under this
Indenture and the Notes. Such successor Person thereupon may cause to be signed,
and may issue
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either in its own name or in the name of the Company, any or all of the Notes
issuable hereunder that theretofore shall not have been signed by the Company
and delivered to the Trustee; and, upon the order of such successor Person,
instead of the Company, and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee shall authenticate and shall deliver
any Notes that previously shall have been signed and delivered by the officers
of the Company to the Trustee for authentication, and any Notes that such
successor Person 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 case of any such consolidation, merger, sale, lease, conveyance or other
disposition, such changes in phraseology and form (but not in substance) may be
made in the Notes thereafter to be issued as may be appropriate.
SECTION 7.03. Officers' Certificate and Opinion of Counsel. Any consolidation,
merger, sale, lease, transfer, conveyance or other disposition permitted under
Section 7.01 is also subject to the condition that the Trustee receive an
Officers' Certificate and an Opinion of Counsel to the effect that any such
consolidation, merger, sale, lease, transfer, conveyance or other disposition
complies with the provisions of this Article. Such opinion of counsel shall
state that any supplemental indenture executed and delivered by a successor
Person pursuant to this Article 7 constitutes the legal, valid and binding
obligation of such successor Person, subject to customary and appropriate
exceptions.
ARTICLE 8
SUPPLEMENTAL INDENTURES
SECTION 8.01. Supplemental Indentures Without Consent of Holders. Without the
consent of any Holders of Notes, the Company, when authorized by or pursuant to
a Board Resolution, and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form satisfactory to
the Trustee, for any of the following purposes:
(a) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants of the Company contained
herein and the Notes issued hereunder;
(b) to add to the covenants of the Company for the equal and ratable
benefit of the Holders or to surrender any right, power or option herein
conferred upon the Company;
(c) to add any Events of Default for the benefit of the Holders
proposed by the Company in a Company Request and, in respect of any such
additional Event of Default, 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 Event of Default, or may limit the remedies available to
the Trustee upon
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such Event of Default or limit the right of the Holders of a majority in
aggregate principal amount of those Notes to which such additional Events of
Default apply to waive such default, all as set forth in the Company Request;
(d) to evidence and provide for the acceptance of appointment hereunder
by a successor Trustee and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the administration
of the trusts hereunder by more than one Trustee;
(e) to cure any ambiguity or to correct or supplement any provision
herein that may be defective or inconsistent with any other provision herein;
provided such provisions shall not adversely affect the interests of the Holders
of Notes in any material respect;
(f) to make any change that does not adversely affect the rights of any
holder of Notes or to surrender any right, power or option conferred on the
Company hereunder;
(g) to make any change to comply with any requirement of the Commission
in connection with the qualification of the Indenture under TIA; or
(h) to provide for the issuance of uncertificated Notes in addition to
or in place of certificated Notes; provided, however that the uncertificated
Notes are issued in registered form for purposes of Section 163(f) of the
Internal Revenue Code of 1986.
The Company and the Trustee may not enter into a supplemental indenture pursuant
to this Section 8.01 if such supplemental indenture modifies in any respect any
Event of Default relating to any covenant in this Indenture in effect
immediately prior to the time such supplemental indenture becomes effective.
SECTION 8.02. Supplemental Indentures with Consent of Holders. With the consent
of the Holders of not less than a majority in principal amount of the
Outstanding Notes affected by such supplemental indenture, by Act of said
Holders delivered to the Company and the Trustee, the Company, when authorized
by or pursuant to a Board Resolution, and the Trustee may 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 of modifying in any manner the rights of the Holders;
provided, however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Note affected thereby:
(a) reduce the principal amount, Repurchase Price or Redemption Price
with respect to any Note, or extend the Stated Maturity of any Note or alter the
manner of payment or rate of interest on any Note or make any Note (including
any Redemption Price or Repurchase Price in respect of such Note) payable in
money or Notes other than that stated in the Note;
(b) reduce the percentage in principal amount of the Outstanding Notes
the consent of whose Holders is required for any such supplemental indenture or
the consent of whose Holders is
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required for any waiver with respect to Notes (or for any waiver of compliance
with certain provisions of this Indenture or certain Defaults or Events of
Default and their consequences);
(c) make any change that adversely affects the right to convert any
Note;
(d) modify the provisions of the Indenture relating to the ranking of
the Notes in a manner adverse to the Holders of the Notes; or
(e) impair the right to institute suit for the enforcement of any
payment with respect to, or conversion of, the Notes.
It shall not be necessary for any Act of Holders under this Section to approve
the particular form of any proposed supplemental indenture, but it shall be
sufficient if such Act shall approve the substance thereof.
SECTION 8.03. Execution of Supplemental Indenture. In executing, or accepting
the additional trusts created by, any supplemental indenture permitted by this
Article or the modification thereby of the trusts created by this Indenture, the
Trustee shall be entitled to receive, and (subject to Article 5) shall be fully
protected in relying upon, an Opinion of Counsel stating that (i) the execution
of such supplemental indenture is authorized or permitted by this Indenture,
(ii) all conditions precedent to its execution and delivery have been complied
with, and (iii) such supplemental indenture constitutes the valid and binding
obligation of the Company. The Trustee may, but shall not be obligated to, enter
into any such supplemental indenture that affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise.
SECTION 8.04. Effect of Supplemental Indentures. Upon the execution of any
supplemental indenture under this Article, this Indenture shall be modified in
accordance therewith, and such supplemental indenture shall form a part of this
Indenture for all purposes; and every Holder of Notes theretofore or thereafter
authenticated and delivered hereunder shall be bound thereby.
SECTION 8.05. Conformity with Trust Indenture Act. Every supplemental indenture
executed pursuant to this Article shall conform to the requirements of the Trust
Indenture Act as then in effect.
SECTION 8.06. Reference in Notes to Supplemental Indentures. Notes authenticated
and delivered after the execution of any supplemental indenture pursuant to this
Article may, and shall, if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
indenture. If the Company shall so determine, new Notes so modified as to
conform, in the opinion of the Trustee and the Company, to any such supplemental
indenture may be prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Notes.
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ARTICLE 9
COVENANTS
SECTION 9.01. Payment of Principal, Premium, If Any, and Interest. The Company
covenants and agrees for the benefit of the Holders of Notes that it shall duly
and punctually pay the principal of (and premium, if any), interest on, and the
Repurchase Price, the Redemption Price with respect to, the Notes in accordance
with the terms of the Notes and this Indenture. At the option of the Company,
all payments of principal with respect to any Note may be paid by check to the
registered Holder of the Note or other Person entitled thereto against surrender
of such Note. The conversion of any Notes pursuant to Article 12 hereof by
delivery of shares of Common Stock in accordance with Article 10, together with
the making of any cash payments required to be made in accordance with the terms
of the Notes and this Indenture, shall satisfy the Company's obligations under
this Section 9.01 with respect to such Notes.
SECTION 9.02. Maintenance of Office or Agency. The Company shall maintain a
Place of Payment for the Notes in the Borough of Manhattan, The City of New
York, which shall be an office or agency where the Notes may be presented or
surrendered for payment or conversion, exchange or redemption, where the Notes
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Company in respect of the Notes and this Indenture
may be served. The Company initially designates U.S. Bank National Association,
U.S. Bank Trust New York, 000 Xxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, XX 00000 as
such an office or agency of the Company, unless and until the Company shall
designate and maintain some other office or agency for one or more of such
purposes. The Company shall give prompt written notice to the Trustee of the
location, and any change in the location, of each such office or agency. 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, and the Company hereby appoints the
Trustee its agent to receive all such presentations, surrenders, notices and
demands.
The Company may from time to time designate one or more other offices or
agencies (in or outside of The City of New York) where the Notes may be
presented or surrendered for any or all of such purposes, and may from time to
time rescind such designations; provided, however, that no such designation or
rescission shall in any manner relieve the Company of its obligation to maintain
an office or agency in accordance with the requirements set forth above for such
purposes. The Company shall give prompt written notice to the Trustee of any
such designation or rescission and of any change in the location of any such
other office or agency.
SECTION 9.03. Money for Notes Payments to Be Held in Trust. If the Company shall
at any time act as its own Paying Agent with respect to any Notes, it shall, on
or before each due date of the principal of (and premium, if any), or interest
on, the Notes, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal (and premium, if any) or
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided, and shall promptly notify the Trustee
of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for the Notes, it
shall, before each due date of the principal of (and premium, if any), or
interest on, the Notes, deposit with a Paying Agent a sum sufficient to pay the
principal (and premium, if any) or interest, so becoming
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due, such sum to be held in trust for the benefit of the Persons entitled to
such principal, premium or interest and (unless such Paying Agent is the
Trustee) the Company shall promptly notify the Trustee of its action or failure
so to act.
The Company shall cause each Paying Agent other than the Trustee to execute and
deliver to the Trustee an instrument pursuant to which such Paying Agent shall
agree with the Trustee, subject to the provisions of this Section, that such
Paying Agent shall:
(a) hold all sums held by it for the payment of principal of (and
premium, if any,) or interest on the Notes, in trust for the benefit of the
Persons entitled thereto, until such sums shall be paid to such Persons or
otherwise disposed of as herein provided;
(b) give the Trustee notice of any default by the Company (or any other
obligor upon the Notes under a supplemental indenture entered into in accordance
herewith) in the making of any such payment of principal (and premium, if any)
or interest; and
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction and
discharge of this Indenture or for any other purpose, pay, or by Company Order
direct any Paying Agent to pay, to the Trustee all sums held in trust by the
Company or such Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying
Agent shall be released from all further liability with respect to such sums.
Any money deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of (and premium, if any) or
interest on any Note and remaining unclaimed for two years after such principal
(and premium, if any) or interest has become due and payable shall be paid to
the Company upon Company Request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as an
unsecured general creditor, look only to the Company for payment of such
principal of (and premium, if any) or interest on any Note, without interest
thereon, and all liability of the Trustee or such Paying Agent with respect to
such trust money, and all liability of the Company as trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Company cause to be published once, in an Authorized Newspaper, notice that such
money remains unclaimed and that, after a date specified therein, which shall
not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining shall be repaid to the Company.
SECTION 9.04. Existence. Subject to Article 7, the Company shall do or cause to
be done all things necessary to preserve and keep in full force and effect the
corporate existence of the Company and its Subsidiaries, and their respective
rights (charter and statutory) and franchises, except to the extent that the
Board of Directors shall determine that the failure to do so would not have a
material adverse effect on the business, assets, financial condition or results
of operation of
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the Company (a "Material Adverse Effect"); provided, however, that the Company
shall not be required to preserve any right or franchise if the Board of
Directors 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 9.05. Payment of Taxes and Other Claims. The Company shall pay or
discharge, or cause to be paid or discharged, before the same shall become
delinquent, (1) all taxes, assessments and governmental charges levied or
imposed upon it or any Subsidiary or upon the income, profits or property of the
Company or any Subsidiary, and (2) all lawful claims for labor, materials and
supplies which, if unpaid, might by law become a lien upon the property of the
Company or any Subsidiary and have a Material Adverse Effect; provided, however,
that the Company shall not be required to pay or discharge or cause to be paid
or discharged any such tax, assessment, charge or claim, the amount,
applicability or validity of which is being contested in good faith by
appropriate proceedings.
SECTION 9.06. Statement as to Compliance; Notice of Default.
The Company shall deliver to the Trustee, within 120 days after the end of each
fiscal year of the Company, a certificate from the Company's Chief Executive
Officer, Chief Financial Officer or principal accounting officer as to his or
her knowledge of the Company's compliance with all terms, conditions and
provisions under this Indenture and, in the event of any noncompliance,
specifying such noncompliance and the nature and status thereof. As of the date
hereof, the Company's fiscal year ends on December 31. For purposes of this
Section 9.06, such compliance shall be determined without regard to any period
of grace or requirement of notice under this Indenture. The Company, within five
Business Days of becoming aware of the occurrence of any Default or Event of
Default, shall deliver written notice to the Trustee of the occurrence thereof.
SECTION 9.07. Prohibition on Private Transactions Involving Existing Notes. For
the two-year period commencing on the date hereof and expiring on August [ ],
2005, so long as any Notes remain outstanding during such two-year period, the
Company covenants that it shall not engage in any private or open-market
repurchases, debt-for-equity swaps, or similar transactions with respect to the
Existing Notes.
SECTION 9.08. Waiver of Certain Covenants. The Company may omit in any
particular instance to comply with any term, provision or condition set forth in
Section 9.04, 9.05, or 9.07 if, before the time for such compliance, the Holders
of at least a majority in principal amount of the Outstanding Notes, by Act of
such Holders, either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Company
and the duties of the Trustee in respect of any such term, provision or
condition shall remain in full force and effect.
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ARTICLE 10
REDEMPTION OF NOTES
SECTION 10.01. Optional Redemption by the Company.
The Notes may be redeemed at the election of the Company, as a whole or from
time to time in part, at any time after August [ ], 2005 and prior to maturity
(an "Optional Redemption"), upon notice as set forth in Section 10.04, at a
redemption price equal to 100% of the principal amount so redeemed, together
with accrued and unpaid interest on the principal amount so redeemed, if any, up
to but excluding the date fixed for redemption (the "Optional Redemption
Price").
SECTION 10.02. 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 all or any part of the Notes
pursuant to Section 10.01, the Company shall, at least 15 days prior to the
giving of the notice of redemption in Section 10.04 to the Holders (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of the
Redemption Date and of the principal amount of Notes to be redeemed. In the case
of any redemption of Notes prior to the expiration of any restriction on such
redemption provided in the terms of such Notes or elsewhere in this Indenture,
the Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with all such restrictions.
SECTION 10.03. 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 not more than 60 days and not less than 30 days prior to the Redemption
Date by the Trustee, from the Outstanding Notes not previously called for
redemption, by lot, pro rata or any other method that complies with the
requirements of any exchange on which the Notes are listed or quoted and that
the Trustee shall deem fair and appropriate.
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, solely for
purposes of determining the aggregate principal amount of the Notes to be
redeemed, to be the portion selected for redemption (provided, however, that the
Holder of such Note so converted and deemed redeemed shall not be entitled to
any interest payment as a result of such deemed redemption except for such
interest payment as such Holder would have otherwise been entitled to receive
upon conversion of such Note). Notes that 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.
Notes in denominations of $1,000 may only be redeemed in whole. The Trustee may
select for redemption portions (equal to $1,000 or any integral multiple
thereof) of the principal of Notes that have denominations larger than $1,000.
The Trustee shall promptly notify the Company and the Note Registrar (if other
than itself) in writing of the Notes selected for redemption and, in the case of
any Notes selected for partial redemption, the principal amount thereof to be
redeemed.
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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
Note redeemed or to be redeemed only in part, to the portion of the principal
amount of such Note which has been or is to be redeemed.
SECTION 10.04. Notice of Redemption. Notice of redemption shall be given in the
manner provided in Section 1.07, at least 30 days, but not more than 60 days,
prior to the Redemption Date; provided, that failure to give such notice in the
manner herein provided to the Holder of any Note designated for redemption as a
whole or in part, or any defect in the notice to any such Holder, shall not
affect the validity of the proceedings for the redemption of any other such Note
or portion thereof.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all Outstanding Notes are to be redeemed, the
identification (and, in the case of partial redemption, the principal amount) of
the particular Notes to be redeemed;
(d) if any Note is to be redeemed in part only, the portion of the
principal amount of such Note to be redeemed, and the notice that relates to
such Note shall state that on and after the Redemption Date, upon surrender of
such Note, the holder shall receive, without a charge, a new Note or Notes of
authorized denominations for the principal amount thereof remaining unredeemed;
(e) that on the Redemption Date, the Redemption Price shall become due
and payable upon each such Note, or the portion thereof, to be redeemed;
(f) that the interest on the Note or the portion of the principal
amount of the Note to be redeemed accrued to, but excluding, the Redemption Date
will be paid as specified in such notice and that on and after the Redemption
Date, interest thereon or on the portion thereof to be redeemed will cease to
accrue;
(g) the Place or Places of Payment where such Notes are to be
surrendered for payment of the Redemption Price;
(h) that Notes called for redemption must be presented and surrendered
to the Paying Agent to collect the redemption price;
(i) the then current Conversion Consideration;
(j) that the Notes called for redemption may be converted for the
Conversion Consideration at any time before the close of business on the last
Business Day prior to the Redemption Date;
(k) the CUSIP number of such Note, if any; and
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(l) that a Holder of Notes who desires to convert Notes must satisfy
the requirements for conversion contained in such Notes.
Notice of redemption of Notes to be redeemed shall be given by the Company or,
at the Company's request, by the Trustee in the name and at the expense of the
Company.
SECTION 10.05. Deposit of Redemption Price. Not later than 11:00 a.m. New York
City time on the Redemption Date, the Company shall deposit with the Trustee or
with a Paying Agent (or, if the Company is acting as its own Paying Agent,
segregate and hold in trust as provided in Section 9.03) an amount of money
sufficient to pay, on the Redemption Date, the Redemption Price of all the Notes
or portions thereof that are to be redeemed on that date, other than Notes or
portions thereof called for redemption on that date that have been delivered by
the Company to the Trustee for cancellation or have been converted. Upon written
request, the Trustee or the Paying Agent, as the case may be, shall return to
the Company no later than 5 Business Days after such request any money not
required to pay such Redemption Price.
SECTION 10.06. 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, and from
and after such date (unless the Company shall default in the payment of the
Redemption Price) such Notes shall cease to bear interest. Upon surrender of any
such Note for redemption in accordance with said notice, such Note shall be paid
by the Company at the Redemption Price.
If any Note called for redemption shall not be so paid upon surrender thereof
for redemption, the Redemption Price, shall, until paid, bear interest from the
Redemption Date at the rate borne by the Note and such Note shall remain
convertible into Common Stock until the Redemption Price, and any such accrued
interest, shall have been paid or duly provided for.
SECTION 10.07. Notes Redeemed in Part. Any Note that is to be redeemed only in
part (pursuant to the provisions of this Article) shall be surrendered at a
Place of Payment therefor (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 deliver 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.
ARTICLE 11
REPURCHASE AT OPTION OF HOLDERS UPON CHANGE IN CONTROL
SECTION 11.01. Right to Require Repurchase. If, at any time prior to August [ ],
2007 there shall occur a Repurchase Event, then each Holder shall have the
right, at such Holder's option, to require the Company to repurchase all of such
Holder's Notes, or any portion thereof (in principal amounts of $1,000 or
integral multiples thereof), on the date (the "Repurchase Date") that is
forty-five (45) Business Days after the date of the occurrence of a Repurchase
Event at a price equal to
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100% of the principal amount of Notes such Holder elects to require the Company
to repurchase, together with accrued and unpaid interest on such principal
amount, if any, up to but excluding the repurchase date (the "Repurchase
Price").
SECTION 11.02. 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 date that is 30 Business Days after the occurrence of a
Repurchase Event, the Company shall give notice to all Holders of Outstanding
Notes and to the Trustee (the "Company Notice") of the occurrence of the
Repurchase Event and of the repurchase right set forth herein arising as a
result thereof.
Each Company Notice shall state:
(i) the date of such Change in Control and, briefly, the events causing
such Change in Control;
(ii) the date by which the Change in Control Purchase Notice (as
defined below) must be delivered;
(iii) the Repurchase Date;
(iv) the Repurchase Price;
(v) a description of the procedure that a Holder must follow to
exercise a repurchase right;
(vi) the procedures for withdrawing a Change in Control Purchase
Notice;
(vii) the place or places where such Notes are to be surrendered for
payment of the Repurchase Price or for conversion;
(viii) briefly, the conversion rights of Holders of Notes;
(ix) the Conversion Consideration and any adjustments thereto; and
(x) that Holders who want to convert Notes must satisfy the
requirements set forth in the Notes.
Promptly after giving the Company Notice to the Holders of Outstanding Notes and
to the Trustee, the Company shall cause a copy of the Company Notice to be
published in The Wall Street Journal or another daily newspaper of national
circulation and will also post such notice on the Company's website.
(b) [Intentionally Omitted]
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(c) To exercise a repurchase right, a Holder must deliver to the
Trustee or at the office or agency maintained by the Company for such purpose in
the Borough of Manhattan, The City of New York pursuant to Section 9.02, prior
to the close of business on or before the Repurchase Date, (i) written notice of
the Holder's exercise of such right (the "Change in Control Purchase Notice"),
which notice shall set forth (A) the name of the Holder, (B) the certificate
numbers of the Notes with respect to which the repurchase right is being
exercised, (C) the principal amount of the Notes to be repurchased (and, if any
Note is to be repurchased in part, the portion of the principal amount thereof
to be repurchased, which shall be in integral multiples of $1,000) and (D) a
statement that an election to exercise the repurchase right is being made
thereby pursuant to the applicable provisions of the Notes and (ii) surrender
the Notes subject to the Change in Control Purchase Notice.
(d) On or prior to the Repurchase Date the Company shall deposit with
the Trustee or with the Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 9.03) an amount
of money sufficient to pay the Repurchase Price of the Notes that are to be
repaid on the Repurchase Date. On the Repurchase Date, the Trustee, a Paying
Agent (or, if the Company is acting as its own Paying Agent, the Company) shall
repurchase all such Notes validly tendered prior to such date.
(e) In the event that a Holder has previously delivered a Change in
Control Purchase Notice, but failed to surrender the Note with respect to which
such Change in Control Purchase Notice relates, then so long as the Trustee or
the Paying Agent holds (or, if the Company is acting as its own Paying Agent,
the Company segregates and holds in trust as provided in Section 9.03) money
sufficient to pay the Repurchase Price in respect of such Note, then such Note
shall cease to be Outstanding for the purposes of this Indenture on the
Repurchase Date and all rights of the Holder thereof other than the right to
receive the Repurchase Price shall terminate.
(f) All Notes delivered for repurchase shall be delivered to the
Trustee to be canceled in accordance with the provisions of Section 3.08.
(g) If any Note (or portion thereof) surrendered for repurchase shall
not have been repurchased on the Business Day following the Repurchase Date, the
Repurchase Price in respect of such Note shall, until paid, bear interest from
the Business Day following the Repurchase Date at the rate borne by the Note and
such Note shall remain convertible into Common Stock until the Repurchase Price
and any such accrued interest shall have been paid or duly provided for.
(h) Any Note that is to be repurchased only in part shall be
surrendered to the Trustee or any such Paying Agent (or if the Company is acting
as its own Paying Agent, the Company) and the Company shall execute, and the
Trustee shall authenticate and deliver 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 portion of the principal of the Note so surrendered that was
not repurchased.
(i) Any Holder that has delivered a Change in Control Purchase Notice
shall have the right to withdraw such notice by delivery of a written notice of
withdrawal to the Trustee or any such
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Paying Agent prior to the close of business on the Repurchase Date. The notice
of withdrawal shall state the principal amount and the certificate numbers of
the Notes as to which the withdrawal notice relates and the principal amount, if
any, that remains subject to the Change in Control Purchase Notice. A Note in
respect of which a Holder has exercised its right to require repurchase upon a
Change in Control may thereafter be converted into Common Stock only if, and at
such time as, such Holder withdraws its Change in Control Purchase Notice in
accordance with the preceding sentence.
(j) Notwithstanding anything to the contrary in this Section 11.02, the
Company shall not be required to give the Company Notice following the
occurrence of a Change in Control if, in the manner, at the time and otherwise
in compliance with the requirements set forth herein regarding the Company's
obligation to offer to repurchase the Outstanding Notes following the occurrence
of a Change in Control, (A) another Person makes an offer to repurchase the
Outstanding Notes by giving a notice containing the information set forth in
clauses (i) through (x) of Section 11.02 (a) to the Holders of all Outstanding
Notes and to the Trustee, (B) such Person repurchases all Outstanding Notes
validly tendered and not withdrawn, and (C) such Person makes all payments with
respect thereto. This Section 11.02(j) shall not relieve the Company of any of
its obligations under this Indenture or any Note; provided, however, that if
another Person makes the offer to repurchase Outstanding Notes as set forth in
this Section, the Company shall not be obligated to give the Company Notice.
(k) Absent, and except to the extent of, the Trustee's receipt of a
Company Notice of a Change in Control, the Trustee shall not be under any duty
to determine or monitor whether a Change in Control has occurred, from time to
time.
SECTION 11.03. Certain Definitions. For purposes of this Article 11:
(a) the terms "beneficial owner" and "beneficial ownership" shall be
determined in accordance with Rules 13d-3 and 13d-5 promulgated by the
Commission pursuant to the Exchange Act, except that a Person shall be deemed to
have "beneficial ownership" of all securities that such Person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time;
(b) the term "Person" shall include any syndicate or group that would
be deemed to be a "person" under Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act; and
(c) the term "Repurchase Event" means a Change in Control.
Section 11.04. Change in Control. A "Change in Control" shall be deemed to have
occurred at such time after the original issuance of the Notes as:
(a) any Person acquires the beneficial ownership, directly or
indirectly, through a purchase, merger or other acquisition transaction (other
than a transaction described in (b) below), of more than 50% of the total voting
power of the total outstanding voting stock of the Company other than an
acquisition by the Company, any of its Subsidiaries or any of its employee
benefit plans;
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(b) the Company shall consolidate with, or merge with or into, another
Person or convey, transfer, lease or otherwise dispose of all or substantially
all of its assets to any Person, or any Person consolidates with or merges with
or into the Company, in any such event pursuant to a transaction in which the
Company's outstanding voting stock is converted into or exchanged for cash,
securities or other property, other than any such transactions where:
(i) the Company's voting stock is not converted or exchanged
at all (except to the extent necessary to reflect a change in the
Company's jurisdiction of incorporation) or is converted into or
exchanged for voting stock (other than Redeemable Capital Stock) of the
surviving or transferee corporation, and
(ii) immediately after such transaction, no Person, other than
one or more Persons who were the beneficial owner, directly or
indirectly, of more than 50% of the total voting power of all of the
Company's voting stock immediately before such transaction, is the
beneficial owner, directly or indirectly, of more than 50% of the total
outstanding voting stock of the surviving or transferee corporation;
(c) during any consecutive two-year period, individuals who at the
beginning of such period constituted the Board of Directors (but not a committee
thereof), together with any new directors whose election to such Board of
Directors (but not a committee thereof), or whose nomination for election by the
Company's stockholders, was approved by a vote of a majority of the directors
then still in office who were either directors at the beginning of such period
or whose election or nomination for election was previously so approved, cease
for any reason to constitute a majority of the Board of Directors (but not a
committee thereof) then in office; or
(d) a special resolution is passed by the Company's stockholders
approving a plan of liquidation or dissolution of the Company (other than in a
transaction that complies with the provisions described in Article 7), and no
additional approvals of the Company's stockholders are required under applicable
law to cause such a liquidation or dissolution.
"Redeemable Capital Stock" means any class or series of capital stock that,
either by its terms, by the terms of any security into which it is convertible
or exchangeable or by contract or otherwise, is, or upon the happening of an
event or passage of time would be, required to be redeemed prior to the Stated
Maturity of the Notes or is redeemable at the option of the holder thereof at
any time prior to such Stated Maturity, or is convertible into or exchangeable
for debt securities at any time prior to such Stated Maturity; provided,
however, that Redeemable Capital Stock shall not include any Common Stock which
the holder may cause the Company to repurchase or redeem upon termination of
such holder's employment.
ARTICLE 12
CONVERSION
SECTION 12.01. Conversion Privilege and Conversion Consideration.
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(a) Subject to and upon compliance with the provisions of this Article
12, at the option of the Holder thereof, any Note or any portion of the
principal amount thereof that is $1,000 or an integral multiple of $1,000 may be
converted, except as otherwise provided herein, at any time after original
issuance thereof and prior to the close of business on August [ ], 2007 into (i)
that number of fully-paid and non-assessable shares of the Company's Common
Stock as is equal to [__] (the "Base Shares"), plus (ii) $[____] cash (the "Plus
Cash Amount").
The Company, at its sole option, may pay the Plus Cash Amount in shares of
Common Stock (the "Plus Cash Shares"); provided, however, that the Company shall
not make any payment of the Plus Cash Amount in Plus Cash Shares unless the
daily volume-weighted average price of the Common Stock for the ten (10) Trading
Days ending on and including the second Trading Day immediately preceding the
Conversion Date (as defined below) equals or exceeds the Threshold Price. The
Common Stock deliverable upon conversion (whether in respect of Base Shares or
Plus Cash Shares, as applicable) and any cash delivered in respect of the Plus
Cash Amount are hereinafter referred to in the aggregate as the "Conversion
Consideration." If the Company elects to pay the Plus Cash Amount in Plus Cash
Shares, the Plus Cash Shares will be valued at 95% of the simple average of the
daily volume-weighted average price of the Common Stock for the ten (10) Trading
Days ending on and including the second Trading Day immediately preceding the
Conversion Date. The number of Base Shares and any calculation or determination
in respect of the simple average of the daily volume-weighted average price of
the Common Stock shall be adjusted as provided for in Section 12.04.
(b) In case a Note or portion thereof has previously been called for
redemption at the election of the Company, such conversion right in respect of
the Note or portion so called shall expire at the close of business, New York
City time, on the last Business Day prior to the Redemption Date, unless the
Company defaults in making the payment due upon redemption.
(c) A Note in respect of which a Holder has delivered a Change in
Control Purchase Notice (as defined in Article 11 hereof) exercising the option
of such Holder to require the Company to purchase such Note may be converted
only if such notice and the Note is withdrawn by a written notice of withdrawal
delivered by the Holder to the Trustee or any Paying Agent prior to the close of
business on the Repurchase Date, in accordance with the terms of this Indenture.
(d) From and after the delivery by the Company of any notice of
Automatic Conversion (as defined below) with respect to any portion of the
Notes, Holders shall be entitled to convert any Notes or portion of the
principal amount thereof held by them only on or after the Automatic Conversion
Date (as defined below). If in connection with any such conversion the Company
elects to pay the Plus Cash Amount in Plus Cash Shares, the Plus Cash Shares
delivered will be valued with respect to any Note or any portion of the
principal amount thereof:
(1) if the Holder elects to convert on the Automatic
Conversion Date, at the greater of (x) 95% of the simple average of the
daily volume-weighted average price of the Common Stock for the ten
(10) Trading Days ending on and including the second Trading Day
immediately preceding the Automatic Conversion Date, or (y) 95% of the
Automatic Conversion Price (as defined below); or
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(2) if the Holder elects to convert after the Automatic
Conversion Date, unless and until a subsequent Automatic Conversion
Notice, if any, has been delivered pursuant to Section 12.12 hereof,
95% of the simple average of the daily volume-weighted average price of
the Common Stock for the ten (10) Trading Days ending on an including
the second Trading Day immediately preceding the Conversion Date,
provided, however, in the case of this Section 12.01(d)(2), the Company
may not pay the Plus Cash Amount in Plus Cash Shares unless the daily
volume-weighted average for the ten (10) Trading Days ending on and
including the second Trading Day immediately preceding the Conversion
Date equals or exceeds the Threshold Price.
SECTION 12.02. Exercise of Conversion Privilege. In order to exercise the
conversion privilege with respect to any Note in definitive form, the Holder of
any Note to be converted shall surrender such Note, duly endorsed or assigned to
the Company or in blank, at any office or agency maintained by the Company
pursuant to Section 9.02, accompanied by (a) written notice to the Company in
substantially the form of conversion notice attached to the form of Note
attached as Exhibit A hereto at such office or agency that the Holder elects to
convert such Note or, if less than the entire principal amount thereof is to be
converted, the portion thereof to be converted, (b) the funds, if any, required
by this Section 12.02, and (c) if shares or any portion of such Note not to be
converted are to be issued in the name of a Person other than the Holder
thereof, the name of the Person in which to issue such shares and the transfer
taxes, if any, required to be paid by the Holder pursuant to Section 12.08.
In order to exercise the conversion privilege with respect to any interest in a
global Note, the beneficial owner must complete, or cause to be completed, the
appropriate instruction form for conversion pursuant to the depositary's
book-entry conversion program, deliver, or cause to be delivered, by book-entry
delivery, an interest in such global Note, furnish appropriate endorsements and
transfer documents if required by the Company or the Trustee or other agent, and
pay the funds, if any, required by this Section 12.02 and any transfer taxes if
required pursuant to Section 12.08.
As promptly as practicable after satisfaction of the requirements for conversion
set forth above, the Company shall pay to such Holder the Plus Cash Amount
and/or shall issue and deliver to such Holder a certificate or certificates for
the number of full shares of Common Stock issuable upon the conversion of such
Note or portion thereof in accordance with the provisions of this Article
(including with respect to any Plus Cash Shares, as applicable) and a check or
cash in respect of any fractional interest in respect of a share of Common Stock
arising upon such conversion, as provided in Section 12.03. In case any Note of
a denomination greater than $1,000 shall be surrendered for partial conversion,
and subject to Article 2, the Company shall execute, and the Trustee shall
authenticate and deliver to the holder of the Note so surrendered, without
charge, a new Note or Notes in authorized denominations in an aggregate
principal amount equal to the unconverted portion of the surrendered Note.
Each conversion shall be deemed to have been effected as to any such Note (or
portion thereof) on the date on which the requirements set forth above in this
Section 12.02 have been satisfied as to such Note (or portion thereof), and the
Person in whose name any certificate or
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certificates for shares of Common Stock shall be issuable upon such conversion
shall be deemed to have become on said date the holder of record of the shares
represented thereby; provided however that any such surrender on any date when
the stock transfer books of the Company shall be closed shall constitute the
Person in whose name the certificates are to be issued as the record holder
thereof for all purposes on the next succeeding day on which such stock transfer
books are open, but such conversion shall be for the Conversion Consideration in
effect on the date upon which such Note shall be surrendered.
Any Note or portion thereof surrendered for conversion during the period from
the close of business on the record date for any interest payment date to the
close of business on the Business Day immediately preceding the following
interest payment date that has not been called for redemption during such
period, shall be accompanied by payment, in immediately available funds or other
funds acceptable to the Company, of an amount equal to the interest otherwise
payable on such interest payment date on the principal amount being converted;
provided however that no such payment need be made to the extent any overdue
interest shall exist at the time of conversion with respect to any such Note or
portion thereof. Notwithstanding anything to the contrary in the immediately
preceding sentence, the Company may, solely at the Company's option, make
payment of any such interest otherwise payable in shares of its Common Stock;
provided however, that the Company shall not make any payment of any such
interest otherwise payable in shares of Common Stock unless the daily
volume-weighted average price of the Common Stock for the ten (10) Trading Days
ending on and including the second Trading Day immediately preceding the
Conversion Date equals or exceeds the Threshold Price. If the Company elects to
make any payment of any such interest otherwise payable in shares of its Common
Stock, the shares to be delivered will be valued at 95% of the simple average of
the daily volume-weighted average price of the Common Stock for the ten (10)
Trading Days ending on and including the second Trading Day immediately
preceding the Conversion Date.
On conversion of a Note, that portion of accrued and unpaid interest, if any,
remaining unpaid on such conversion shall not be cancelled, extinguished or
forfeited, but rather shall be deemed to be paid in full to the Holder thereof
through delivery of the Common Stock (together with the cash payment, if any, in
lieu of fractional shares) in exchange for the Note being converted pursuant to
the provisions hereof. Except as provided above in this Section 12.02, no
payment or other adjustment shall be made for interest accrued on any Note
converted or for dividends on any shares issued upon the conversion of such Note
as provided in this Article.
Upon the conversion of an interest in a global Note, the Trustee (or other
conversion agent appointed by the Company), shall make a notation on such global
Note as to the reduction in the principal amount represented thereby. The
Company shall notify the Trustee in writing of any conversions of Notes effected
through any Conversion Agent other than the Trustee.
SECTION 12.03. Cash Payments in Lieu of Fractional Shares. No fractional shares
of Common Stock shall be issued upon conversion of Notes. If more than one Note
shall be surrendered for conversion at one time by the same Holder, the number
of full shares that shall be issuable upon conversion thereof shall be computed
on the basis of the aggregate principal amount
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of the Notes (or specified portions thereof) so surrendered. Instead of any
fractional share of Common Stock that would otherwise be issuable upon
conversion of any Note (or specified portions thereof), the Company shall pay a
cash adjustment in respect of such fraction in an amount equal to the same
fraction of the Closing Price per share of the Common Stock at the close of
business on the Trading Day immediately preceding such day.
"Trading Day" shall mean each day on which the primary securities exchange or
quotation system or over-the-counter market that is used to determine the
volume-weighted average price is open for trading or quotation.
"Closing Price" of a single share of Common Stock on any Trading Day shall mean
the closing sale price per share for the Common Stock (or if no closing sale
price is reported, the average of the bid and ask prices) on such Trading Day on
the principal United States national securities exchange on which the Common
Stock is traded or, if the Common Stock is not listed on a United States
national securities exchange, as reported by the Nasdaq, or, if the Common Stock
is not listed on the Nasdaq, the principal United States regional securities
exchange on which the Common Stock is traded or, if the Common Stock is not
listed on a United States regional stock exchange, as reported by the principal
over-the-counter market on which the Common Stock is traded, including the Over
the Counter Bulletin Board (the "OTCBB") or the National Quotation Service
Bureau (commonly known as the "Pink Sheets") or successor markets.
"daily volume-weighted average price" of a single share of Common Stock on any
Trading Day shall mean the daily volume-weighted average price per share for the
Common Stock on such Trading Day on the principal United States national
securities exchange on which the Common Stock is traded or, if the Common Stock
is not listed on a United States national securities exchange, as reported by
the Nasdaq, or, if the Common Stock is not listed on the Nasdaq, the principal
United States regional securities exchange on which the Common Stock is traded
or, if the Common Stock is not listed on a United States regional stock
exchange, as reported by the principal over-the-counter market on which the
Common Stock is traded, including the OTCBB or the National Quotation Service
Bureau or successor markets, in any event, as reported by the Bloomberg L.P. or
such other nationally recognized information source satisfactory to the Trustee.
SECTION 12.04. Adjustment of Conversion Consideration.
(a) If the Company shall, after the date hereof, pay or make a dividend
or other distribution on its Common Stock exclusively in Common Stock, then, in
any such event:
(i) the number of Base Shares each Holder, upon conversion,
shall be entitled to receive shall be increased to equal the number of
shares of Common Stock it would have been entitled to receive with
respect to such Base Shares (prior to any such adjustment) with respect
to such dividend or other distribution if such Note had been converted
immediately prior to the earlier of the date of such dividend or
distribution or the record date with respect thereto, such adjustment
to become effective upon the opening of business on the earlier of the
date next following the date of such dividend or distribution,
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the date next following the record date with respect thereto or the
"ex" date (as hereinafter defined) with respect thereto;
(ii) each of the Automatic Conversion Price and the Threshold
Price shall be reduced by multiplying such price by a fraction, the
numerator of which shall be the number of shares of Common Stock
outstanding on the earlier of the date of such dividend or distribution
or the record date with respect thereto, 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 upon the opening of business on the earlier of the
date next following the date of such dividend or distribution, the date
next following the record date with respect thereto or the "ex" date
with respect thereto; and
(iii) when making any calculation of the simple average of the
daily volume-weighted average price of the Common Stock, the daily
volume-weighted average price of the Common Stock on each day prior to
the earlier of the date of such dividend or distribution, the record
date with respect thereto or the "ex" date with respect thereto shall
be reduced by multiplying such price by a fraction, the numerator of
which shall be the number of shares of Common Stock outstanding on the
earlier of the date of such dividend or distribution or the record date
with respect thereto, 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.
(b) In case the outstanding shares of Common Stock shall be subdivided
or split into a greater number of shares of Common Stock or combined into a
smaller number of shares of Common Stock, then, in any such event:
(i) the number of Base Shares payable on a conversion in
effect at the opening of business on the day next following the day
upon which such subdivision, split or combination becomes effective
shall be proportionately adjusted (i.e., the number of Base Shares
payable on a conversion shall be proportionately increased in
connection with any subdivision or split and proportionately decreased
in connection with any combination), any such adjustment to become
effective upon the opening of business on the earlier of the day next
following the day upon which such subdivision, split or combination
becomes effective or the "ex" date with respect to such subdivision,
split or combination;
(ii) the Automatic Conversion Price and the Threshold Price in
effect at the opening of business on the earlier of the day next
following the day upon which such subdivision, split or combination
becomes effective or the "ex" date with respect to such subdivision,
split or combination shall be proportionately adjusted (i.e., the
Automatic Conversion Price and the Threshold Price shall be
proportionately decreased in connection with any subdivision or split
and proportionately increased in connection with any combination), any
such adjustment to become effective upon the opening of business on the
earlier of the day next following the day upon which such subdivision,
split or
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combination becomes effective or the "ex" date with respect to such
subdivision, split or combination; and
(iii) when making any calculation of the simple average of the
daily volume-weighted average price of the Common Stock, the daily
volume-weighted average price of the Common Stock on each day prior to
the earlier of the day upon which such subdivision, split or
combination becomes effective or the "ex" date with respect to such
subdivision, split or combination shall be proportionately adjusted
(i.e., proportionately decreased in connection with any subdivision or
split and proportionately increased in connection with any
combination).
(c) In case the Company shall pay or make a dividend or other
distribution on its Common Stock consisting exclusively of, or shall otherwise
issue to all holders of its Common Stock, rights, warrants or options entitling
the holders thereof, for a period not exceeding 45 days, to subscribe for or
purchase shares of Common Stock at a price per share less than the current
market price per share (determined as provided in Section 12.04(g)) of the
Common Stock on the date fixed for the determination of stockholders entitled to
receive such rights, warrants or options, then, in any such event:
(i) the number of Base Shares payable on a conversion in
effect at the opening of business on the day next following the date
fixed for such determination shall be increased by multiplying such
number 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 plus the number of shares of Common Stock
so offered for subscription or purchase, and the denominator of which
shall be the number of shares of Common Stock outstanding at the close
of business on the date fixed for such determination plus the number of
shares of Common Stock which the aggregate price of the total number of
shares so offered would purchase at the current market price per share
(determined as provided in Section 12.04(g)), such increase to become
effective immediately after the opening of business on the earlier of
the day next following the date fixed for such determination or the
"ex" date with respect to such dividend or distribution;
(ii) the Automatic Conversion Price and the Threshold Price
shall be decreased by multiplying such number or 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 plus the number of shares of Common Stock which the
aggregate price of the total number of shares so offered would purchase
at the current market price per share (determined as provided in
Section 12.04(g)), and the denominator of which shall be the number of
shares of Common Stock outstanding at the close of business on the date
fixed for such determination plus the number of shares of Common Stock
so offered for subscription or purchase, such decrease to become
effective immediately after the opening of business on the earlier of
the day next following the date fixed for such determination or the
"ex" date with respect to such dividend or distribution; and
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(iii) when making any calculation of the simple average of the
daily volume-weighted average price of the Common Stock, the daily
volume-weighted average price of the Common Stock on each day prior to
the earlier of the date fixed for such determination or the "ex" date
with respect to such dividend or distribution shall be decreased by
multiplying such price by a fraction, the numerator of which shall the
number of shares of Common Stock outstanding at the close of business
on the date fixed for such determination plus the number of shares of
Common Stock which the aggregate price of the total number of shares so
offered would purchase at the current market price per share
(determined as provided in Section 12.04(g)), and the denominator of
which shall be the number of shares of Common Stock outstanding at the
close of business on the date fixed for such determination plus the
number of shares of Common Stock so offered for subscription or
purchase.
(d) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock evidences of its indebtedness, shares of any
class of capital stock, securities, cash or assets (excluding any rights,
warrants or options referred to in Section 12.04(c), any dividend or
distribution paid exclusively in cash and any dividend or distribution referred
to in Section 12.04(a)), then, in any such event:
(i) the number of Base Shares payable on a conversion shall be
increased by multiplying such number in effect immediately prior to the
earlier of such distribution or the determination of stockholders
entitled to receive such distribution by a fraction, the numerator of
which shall be the current market price per share (determined as
provided in Section 12.04(g)) and the denominator of which shall be
such current market price less the fair market value (as determined in
good faith by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution), on the date of such
effectiveness, of the portion of the evidences of indebtedness, shares
of capital stock, securities, cash and assets so distributed applicable
to one share of Common Stock, such adjustment to become effective
immediately prior to the opening of business on the day next following
the earlier of (A) the later of (1) the date fixed for the payment of
such distribution and (2) the date 20 days after the notice relating to
such distribution is given pursuant to Section 12.06 (such later date
of (1) and (2) being referred to as the "Reference Date") or (B) the
"ex" date with respect to such distribution;
(ii) the Automatic Conversion Price and the Threshold Price
shall be decreased by multiplying such price in effect immediately
prior to the earlier of such distribution or the determination of
stockholders entitled to receive such distribution by a fraction, the
numerator of which shall be the current market price per share
(determined as provided in Section 12.04(g)) less the fair market value
(as determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution),
on the date of such effectiveness, of the portion of the evidences of
indebtedness, shares of capital stock, securities, cash and assets so
distributed applicable to one share of Common Stock, and the
denominator of which shall be such current market price, such
adjustment to become effective immediately prior to the opening of
business on the
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earlier of the day next following the Reference Date or the "ex" date
with respect to such distribution; and
(iii) when making any calculation of the simple average of the daily
volume-weighted average price of the Common Stock, the daily
volume-weighted average price of the Common Stock on each day
preceding the earlier of the Reference Date or the "ex" date with
respect to such distribution shall be adjusted by multiplying such
price by a fraction, the numerator of which shall be the current
market price per share (determined as provided in Section 12.04(g))
less the fair market value (as determined in good faith by the Board
of Directors, whose determination shall be conclusive and described in
a Board Resolution), on the date of such effectiveness, of the portion
of the evidences of indebtedness, shares of capital stock, securities,
cash and assets so distributed applicable to one share of Common
Stock, and the denominator of which shall be such current market
price.
The provisions of this Section 12.04(d) shall not be applicable to an event
covered by Section 12.04(k). For purposes of this Section 12.04(d) and Sections
12.04(a) and 12.04(c), any dividend or distribution for which an adjustment is
being made pursuant to this Section 12.04(d) that also includes shares of Common
Stock or rights, warrants or options to subscribe for or purchase shares of
Common Stock shall be deemed instead to be (A) a dividend or distribution of the
evidences of indebtedness, cash, property, shares of capital stock or securities
other than such shares of Common Stock or such rights, warrants or options
(making any adjustment to the number of Base Shares payable on a conversion, the
Automatic Conversion Price, the Threshold Price and any calculation of a simple
average of daily volume-weighted average prices of a share of Common Stock
required by this Section 12.04(d)) immediately followed by (B) a dividend or
distribution of such shares of Common Stock or such rights (making any further
adjustment to the number of Base Shares payable on a conversion, the Automatic
Conversion Price, the Threshold Price and any calculation of a simple average of
daily volume-weighted average prices of a share of Common Stock required by
Sections 12.04(a) or 12.04(c)), except (1) the record date of such dividend or
distribution as defined in this Section 12.04(d) shall be substituted as "the
date fixed for the determination of stockholders entitled to receive such
dividend or other distributions," "the date fixed for the determination of
stockholders entitled to receive such rights, warrants or options" and "the date
fixed for such determination" within the meaning of Sections 12.04(a) and
12.04(c) and (2) 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 this 12.04(d).
(e) In case the Company shall, by dividend or otherwise, make a
distribution to all holders of its Common Stock exclusively in cash in an
aggregate amount that, together with (i) the aggregate amount of any other
distributions to all holders of its Common Stock made exclusively in cash within
the 12 months preceding the date of payment of such distribution and in respect
of which no adjustment to the number of Base Shares payable on a conversion, the
Automatic Conversion Price, the Threshold Price and any calculation of a simple
average of daily volume-weighted average prices of a share of Common Stock
pursuant to this Section 12.04(e) has been made and (ii) the aggregate of any
cash plus the fair market value (as determined in good faith by the Board of
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Directors, whose determination shall be conclusive and described in a Board
Resolution), as of the expiration of the tender or exchange offer referred to
below, of consideration payable in respect of any tender or exchange offer by
the Company or a Subsidiary for all or any portion of the Common Stock concluded
within the 12 months preceding the date of payment of such distribution and in
respect of which no adjustment to the number of Base Shares payable on a
conversion, the Automatic Conversion Price, the Threshold Price and any
calculation of a simple average of daily volume-weighted average prices of a
share of Common Stock pursuant to this Section 12.04(e) has been made, exceeds
10% of the product of the current market price per share (determined as provided
in Section 12.04(g)) of the Common Stock as of the Trading Day immediately
preceding the record date fixed for stockholders entitled to receive such
distribution multiplied by the number of shares of Common Stock outstanding on
such record date, then, in any such event:
(i) the number of Base Shares payable on a conversion shall be
increased so that the same shall equal the number determined by
multiplying such number in effect immediately prior to the close of
business on the date fixed for the determination of the stockholders of
record entitled to such distribution by a fraction of which (i) the
denominator shall be the current market price per share (determined as
provided in Section 12.04(g)) on such date less an amount equal to the
quotient of (x) the excess of such combined amount over such 10% and
(y) the number of shares of Common Stock outstanding on the record date
and (ii) the numerator shall be equal to the current market price on
such date, such adjustment to become effective immediately prior to the
opening of business on the earlier of the day following the record date
fixed for the payment of such distribution or the "ex" date with
respect to such distribution;
(ii) the Automatic Conversion Price and the Threshold Price
shall be decreased so that the same shall equal the price determined by
multiplying such number or price in effect immediately prior to the
close of business on the date fixed for the determination of the
stockholders of record entitled to such distribution by a fraction of
which (i) the numerator shall be the current market price per share
(determined as provided in Section 12.04(g)) on such date less an
amount equal to the quotient of (x) the excess of such combined amount
over such 10% and (y) the number of shares of Common Stock outstanding
on the record date, and (ii) the denominator shall be equal to the
current market price on such date, such adjustment to become effective
(A) with respect to the Automatic Conversion Price, immediately prior
to the opening of business on the day next following the record date
fixed for the payment of such distribution, and (B) with respect to the
Threshold Price, immediately prior to the opening of business on the
earlier of the day next following the record date fixed for the payment
of such distribution or the "ex" date with respect to such
distribution; and
(iii) when making any calculation of the simple average of the
daily volume-weighted average price of the Common Stock, the daily
volume-weighted average price of the Common Stock on each day prior to
the earlier of the record date fixed for the payment of such
distribution or the "ex" date with respect to such distribution shall
be decreased so that the same shall equal the price determined by
multiplying such price by
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a fraction of which (i) the numerator shall be the current market price
per share (determined as provided in Section 12.04(g)) on such date
less an amount equal to the quotient of (x) the excess of such combined
amount over such 10% and (y) the number of shares of Common Stock
outstanding on the record date, and (ii) the denominator shall be equal
to the current market price on such date.
(f) In case a successful tender or exchange offer, other than an odd
lot offer, made by the Company or any Subsidiary for all or any portion of the
Common Stock shall involve an aggregate consideration having a fair market value
(as determined in good faith by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution) at 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, together with (i) the aggregate of
the cash plus the fair market value (as determined in good faith by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution), as of the expiration of the tender or exchange offer, of
consideration payable in respect of any other tender or exchange offer by the
Company or a Subsidiary for all or any portion of the Common Stock concluded
within the preceding 12 months and in respect of which no adjustment to the
number of Base Shares payable on a conversion, the Automatic Conversion Price,
the Threshold Price and any calculation of a simple average of daily
volume-weighted average prices of a share of Common Stock pursuant to this
Section 12.04(f) has been made and (ii) the aggregate amount of any
distributions to all holders of the Common Stock made exclusively in cash within
the preceding 12 months and in respect of which no adjustment to the number of
Base Shares payable on a conversion, the Automatic Conversion Price, the
Threshold Price and any calculation of a simple average of daily volume-weighted
average prices of a share of Common Stock pursuant to Section 12.04(e) has been
made, exceeds 10% of the product of the current market price per share
(determined as provided in Section 12.04(g)) of the Common Stock outstanding
(including any tendered shares) on the Expiration Time multiplied by the number
of shares of Common Stock outstanding (including any tendered shares) as of the
Expiration Time, then, in each case:
(i) the number of Base Shares payable on a conversion, shall
be increased by multiplying such number in effect immediately prior to
the Expiration Time by a fraction of which (i) the denominator shall be
(x) the product of the current market price per share (determined as
provided in Section 12.04(g)) of the Common Stock on the Trading Day
next succeeding the Expiration Time multiplied by the number of shares
of Common Stock outstanding (including any tendered or exchanged
shares) at the Expiration Time minus (y) 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 (ii) the numerator shall be the product of
(x) such current market price per share (determined in accordance with
Section 12.04(g)) on the Trading Day next succeeding the Expiration
Time multiplied by (y) such number of outstanding shares at the
Expiration Time less the number of Purchased Shares, such increase to
become effective immediately prior to the opening of
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business on the earlier of the day following the Expiration Time or the
"ex" date with respect to such tender or exchange;
(ii) the Automatic Conversion Price and the Threshold Price
shall be decreased by multiplying such price by a fraction of which (i)
the denominator shall be the product of (x) the current market price
per share (determined in accordance with Section 12.04(g)) on the
Trading Day next succeeding the Expiration Time multiplied by (y) such
number of outstanding shares at the Expiration Time less the number of
Purchased Shares and (ii) the numerator shall be (x) the product of the
current market price per share (determined as provided in Section
12.04(g)) of the Common Stock on the Trading Day next succeeding the
Expiration Time multiplied by the number of shares of Common Stock
outstanding (including any tendered or exchanged shares) at the
Expiration Time minus (y) the fair market value (determined as
aforesaid) of the aggregate consideration payable to stockholders based
on the acceptance of the Purchased Shares, such decrease to become
effective (A) with respect to the Automatic Conversion Price,
immediately prior to the opening of business on the day following the
Expiration Time, and (B) with respect to the Threshold Price,
immediately prior to the opening of business on the earlier of the day
following the Expiration Time or the "ex" date with respect to such
tender or exchange; and
(iii) when making any calculation of the simple average of the
daily volume-weighted average price of the Common Stock, the daily
volume-weighted average price of the Common Stock on each day prior to
the earlier of the Expiration Time or the "ex" date with respect to
such tender or exchange shall be adjusted by multiplying such price by
a fraction of which (i) the denominator shall be the product of (x)
such current market price per share (determined in accordance with
Section 12.04(g)) on the Trading Day next succeeding the Expiration
Time multiplied by (y) such number of outstanding shares at the
Expiration Time less the number of Purchased Shares and (ii) the
numerator shall be (x) the product of the current market price per
share (determined as provided in Section 12.04(g)) of the Common Stock
on the Trading Day next succeeding the Expiration Time multiplied by
the number of shares of Common Stock outstanding (including any
tendered or exchanged shares) at the Expiration Time minus (y) the fair
market value (determined as aforesaid) of the aggregate consideration
payable to stockholders based on the acceptance of the Purchased
Shares.
(g) For the purpose of any computation under Sections 12.04(c), (d) and
(e), the current market price per share of Common Stock on any date in question
shall be deemed to be 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 requiring such computation)
that requires an adjustment to the number of Base Shares payable on a
conversion, the Automatic Conversion Price, the Threshold Price or any
calculation of a simple average of daily volume-weighted average
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prices of a share of Common Stock, as applicable, pursuant to Section
12.04(a), (b), (c), (d), (e) or (f) ("Other Event") occurs on or after
the tenth Trading Day prior to the date in question and prior to the
"ex" date for the issuance or distribution requiring such computation
(the "Current Event"), 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 reciprocal of the fraction by which the
number of Base Shares payable on a conversion is so required to be
adjusted as a result of such Other Event,
(2) if the "ex" date for any Other Event occurs after the "ex"
date for the Current Event and on or prior to the date in question, 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
fraction by which the number of Base Shares payable on a conversion is
so required to be adjusted as a result of such Other Event,
(3) if the "ex" date for any Other Event occurs on the "ex"
date for the Current Event, one of those events shall be deemed for
purposes of clauses (1) and (2) of this proviso to have an "ex" date
occurring prior to the "ex" date for the Other Event, and
(4) if the "ex" date for the Current Event is on or after the
tenth Trading Day prior to the date in question and prior to the date
in question, after taking into account any adjustment required pursuant
to clause (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 on the date in question
(as determined in good faith by the Board of Directors in a manner
consistent with any determination of such value for purposes of Section
12.04(d) or (e), whose determination shall be conclusive -------- ---
and described in a Board Resolution) of the portion of the rights,
warrants, options, evidences of indebtedness, shares of capital stock,
securities, cash or property being distributed applicable to one share
of Common Stock.
For the purpose of any computation under Section 12.04(f), the current market
price per share of Common Stock on any date in question shall be deemed to be
the average of the daily Closing Prices for the five consecutive Trading Days
selected by the Company commencing on or after the latest (the "Commencement
Date") of (A) the date 20 Trading Days before the date in question, (B) the date
of commencement of the tender or exchange offer requiring such computation and
(C) the date of the last amendment, if any, of such tender or exchange offer
involving a change in the maximum number of shares for which tenders are sought
or a change in the consideration offered, and ending not later than the Trading
Day next succeeding the Expiration Time of such tender or exchange offer (or, if
such Expiration Time occurs before the close of trading on a Trading Day, not
later than the Trading Day during which the Expiration Time occurs); provided,
however, that if the "ex" date for any Other Event (other than the tender or
exchange offer requiring such computation) occurs on or after the Commencement
Date and on or prior to the Trading Day next succeeding the Expiration Time for
the tender or exchange offer requiring such computation, 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 reciprocal of the same fraction by
which the number of Base Shares payable on
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a conversion is so required to be adjusted as a result of such other event. For
purposes of this paragraph, the term "ex" date, (x) 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 obtained without the right to receive such issuance or
distribution, (y) 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 (z) 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
of such tender or exchange offer.
(h) In addition to those required by paragraphs (a), (b), (c), (d), (e)
and (f) of this Section 12.04, to the extent permitted by applicable law, the
Company from time to time may increase the number of Base Shares and the Plus
Cash Amount payable on a conversion, as applicable, by any amount for any period
of time if the period is at least twenty (20) days and the Board of Directors
shall have made a determination that such increase would be in the best
interests of the Company, which determination shall be conclusive. Whenever the
number of Base Shares and the Plus Cash Amount payable on a conversion, as
applicable, is increased pursuant to the preceding sentence, the Company shall
give notice of the increase to the Holders of Notes in the manner provided in
Section 1.06 at least fifteen (15) days prior to the date the increased number
takes effect, and such notice shall state the increased number of Base Shares
and the increased Plus Cash Amount and the period during which it will be in
effect.
(i) No adjustment in the number of Base Shares payable on a conversion,
the Automatic Conversion Price, the Threshold Price or any calculation of a
simple average of daily volume-weighted average prices of a share of Common
Stock shall be required unless such adjustment would require an increase or
decrease of at least 1% in such number or price; provided, however, that any
adjustments, which by reason of this Section 12.04(i) are not required to be
made, shall be carried forward and taken into account in any subsequent
adjustment.
(j) Each adjustment made pursuant to this Section 12.04 shall be
carried forward and taken into account in any subsequent adjustment pursuant to
this Section 12.04.
(k) In the event that the Company distributes assets, debt securities,
rights, warrants or options (other than those referred to in Section 12.04(c))
pro rata to holders of Common Stock, and the fair market value of the portion of
assets, debt securities, rights, warrants or options applicable to one share of
Common Stock distributed to holders of Common Stock exceeds the Average Sale
Price (as defined below) per share of Common Stock, or such Average Sale Price
exceeds such fair market value by less than $1.00, then so long as any such
assets, debt securities, rights, options or warrants have not expired or been
redeemed by the Company, the Company shall make proper provision so that the
Holder of any Note upon conversion, rather than being entitled to an adjustment
in the number of Base Shares will be entitled to receive upon such conversion,
in addition to the Plus Cash Amount and the shares of Common Stock otherwise
issuable upon conversion, the kind and amount of assets, debt securities,
rights, warrants and options such Holder
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would have received had such Holder converted its Note immediately prior to the
date of determination of the holders entitled to such distribution, assuming for
such purposes that the Plus Cash Amount was paid in cash.
"Average Sale Price" means the average of the Closing Prices of the Common Stock
for the shorter of (i) 30 consecutive Trading Days ending on the last full
Trading Day prior to the Time of Determination (as defined below) with respect
to the rights, options, warrants or distribution in respect of which the Average
Sale Price is being calculated, or (ii) the period (x) commencing on the date
next succeeding the first public announcement of (a) the issuance of rights,
options or warrants or (b) the distribution, in each case, in respect of which
the Average Sale Price is being calculated and (y) proceeding through the last
full Trading Day prior to the Time of Determination with respect to the rights,
options, warrants or distribution in respect of which the Average Sale Price is
being calculated, or (iii) the period, if any, (x) commencing on the date next
succeeding the Ex-Dividend Time (as defined below) with respect to the next
preceding (a) issuance of rights, warrants or options or (b) distribution, in
each case, for which an adjustment is required by the provisions of Section
12.04(c) or Section 12.04(j) and (y) proceeding through the last full Trading
Day prior to the Time of Determination with respect to the rights, options,
warrants, or distribution in respect of which the Average Sale Price is being
calculated. If the Ex-Dividend Time (or in the case of a subdivision,
combination or reclassification, the effective date with respect thereto) with
respect to a dividend, subdivision, combination or reclassification to which
Section 12.04(a), (b) or (c) applies occurs during the period applicable for
calculating "Average Sale Price" pursuant to the definition in the preceding
sentence, "Average Sale Price" shall be calculated for such period in a manner
determined in good faith by the Board of Directors to reflect the impact of such
dividend, subdivision, combination or reclassification on the Closing Price of
the Common Stock during such period.
"Time of Determination" means the time and date of the earlier of (i) the
determination of stockholders entitled to receive rights, warrants or options or
a distribution, in each case, to which this Section 12.04 applies and (ii) the
time ("Ex-Dividend Time") immediately prior to the commencement of "ex-dividend"
trading for such rights, options, warrants or distribution on the New York Stock
Exchange or such other national or regional exchange or market on which the
shares of Common Stock are listed or quoted.
SECTION 12.05. Notice of Adjustments. Whenever the number of Base Shares payable
on a conversion, the Automatic Conversion Price, the Threshold Price or any
calculation of a simple average of daily volume-weighted average prices of a
share of Common Stock is adjusted as herein provided, the Company shall compute
the adjusted number of Base Shares payable on a conversion, the Automatic
Conversion Price, the Threshold Price or calculation of a simple average of
daily volume-weighted average prices of a share of Common Stock in accordance
with Section 12.04 and shall prepare a certificate signed by the Chief Financial
Officer of the Company setting forth the adjusted number of Base Shares payable
on a conversion, the Automatic Conversion Price, the Threshold Price or
calculation of a simple average of daily volume-weighted average prices of a
share of Common Stock and showing in reasonable detail the facts upon which such
adjustment is based, and such certificate shall forthwith be filed (with a copy
to the Trustee or the Conversion Agent) at each office or agency maintained for
the purpose of conversion of Notes pursuant to
-63-
Section 9.02; and the Company shall forthwith cause a notice setting forth the
adjusted number of Base Shares payable on a conversion, the Automatic Conversion
Price or the Threshold Price, to be mailed, first class postage prepaid, to each
Holder of Notes at its address appearing on the Note Register. Unless and until
the Trustee (and the Conversion Agent, as the case may be) shall receive such
notice, the Trustee (and the Conversion Agent, as the case may be) may assume
without inquiry that the number of Base Shares payable on a conversion, the
Auto-Conversion Price, the Threshold Price or any calculation of a simple
average of daily volume-weighted average prices of a share of Common Stock have
not been, and are not required to be, adjusted and that the last number of Base
Shares payable on a conversion, the Automatic Conversion Price, the Threshold
Price or calculation of a simple average of daily volume-weighted average prices
of a share of Common Stock of which it has written notice remains in effect.
SECTION 12.06. Notice of Certain Corporate Action.
In case:
(a) the Company shall declare a dividend (or any other distribution) on
its Common Stock that would require an adjustment to the number of Base Shares
payable on a conversion, the Automatic Conversion Price, the Threshold Price or
any calculation of a simple average of daily volume-weighted average prices of a
share of Common Stock pursuant to Section 12.04(d) or 12.04(e); or
(b) the Company shall authorize the granting to all holders of its
Common Stock of rights, warrants or options to subscribe for or purchase any
shares of capital stock of any class or of any other rights (excluding rights
distributed pursuant to any stockholder rights plan); or
(c) of any reclassification of the Common Stock of the Company (other
than a subdivision or combination of its outstanding shares of 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 or exchange offer for all or a portion of the Company's outstanding
shares of Common Stock (or shall amend any such tender or exchange 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 9.02, and shall cause to
be mailed to all Holders at their last addresses as they shall appear in the
Note Register, at least 20 days (or 10 days in any case specified in clause
12.06(a) or 12.06(b) above) prior to the applicable record, effective or
expiration date hereinafter specified, a notice stating (x) the date on which a
record is to be taken for the purpose of such dividend, distribution or granting
of rights, warrants or options, 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
-64-
dividend, distribution, rights, warrants or options are to be determined, or (y)
the date on which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders 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, sale,
transfer, dissolution, liquidation or winding up, or (z) the date on which such
tender offer commenced, the date on which such tender offer is scheduled to
expire unless extended, the consideration offered and the other material terms
thereof (or the material terms of any amendment thereto).
SECTION 12.07. Company's Obligation Regarding Common Stock. The Company shall at
all times reserve and keep available, free from preemptive rights, out of its
authorized but unissued Common Stock, solely for the purpose of effecting the
conversion of Notes, the whole number of shares of Common Stock then issuable
upon the conversion in full of all Outstanding Notes.
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 shall in good faith and as
expeditiously as practicable endeavor to secure such registration or approval,
as the case may be.
The Company further covenants that so long as the Common Stock shall be listed
or quoted on the New York Stock Exchange, the Nasdaq, or any other national
securities exchange, the Company shall, if permitted by the rules of such
exchange, list and keep listed so long as the Common Stock shall be so listed on
such market or exchange, all Common Stock issuable upon conversion of the Notes.
SECTION 12.08. Taxes on Conversions. The Company shall pay any and all stamp,
documentary or issuance taxes that may be payable in respect of the issue or
delivery of shares of Common Stock on conversion of Notes pursuant hereto, but
shall not pay any taxes measured by net income or otherwise imposed on Holders
in connection with a conversion. The Company shall not, however, be required to
pay any tax that may be payable in respect of any transfer involved in the issue
and delivery of shares 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 has established to the satisfaction of the
Company that such tax has been paid.
SECTION 12.09. Covenant as to Common Stock. The Company covenants that all
shares of Common Stock that may be issued upon conversion of Notes shall upon
issue be newly issued (and not treasury shares) and shall be duly authorized,
validly issued, fully paid and nonassessable and, except as provided in Section
12.08, the Company shall pay all taxes, liens and charges with respect to the
issue thereof.
-65-
SECTION 12.10. Cancellation of Converted Notes. All Notes delivered for
conversion shall be delivered to the Trustee to be cancelled by or at the
direction of the Trustee, which shall dispose of the same as provided in Section
3.08.
SECTION 12.11. Provisions in Case of Reclassification, Consolidation, Merger or
Sale of Assets. In the event that the Company shall be a party to any
transaction (including any (i) recapitalization or reclassification of the
Common Stock (other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a subdivision or
combination of the Common Stock), (ii) any consolidation of the Company with, or
merger of the Company into, any other person, any merger of another person into
the Company (other than a merger that does not result in a reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock of
the Company), (iii) any sale, lease, transfer, conveyance or other disposition
of all or substantially all of the assets of the Company or (iv) any compulsory
share exchange) pursuant to which the Common Stock is converted into the right
to receive other securities, cash or other property, then lawful provision shall
be made as part of the terms of such transaction to the Conversion Consideration
and Automatic Conversion Amount payable upon conversion such that the Holder of
any Note upon such conversion will receive upon conversion (subject to funds
being legally available for such purpose under applicable law at the time of
such conversion) only the kind and amount of securities, cash and other property
receivable upon such transaction by a holder of a number of shares of Common
Stock equal to the number of Base Shares into which such Note might have been
converted immediately prior to such transaction, together with the Plus Cash
Amount. The Company or the Person formed by such consolidation or resulting from
such merger or that acquired such assets or that acquired the Company's shares
of Common Stock, as the case may be, shall execute and deliver to the Trustee a
supplemental indenture, satisfactory to the Trustee, establishing such rights.
Such supplemental indenture shall provide for adjustments that, 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 transactions of the foregoing type.
SECTION 12.12. Automatic Conversion by the Company
(a) The Company may elect, at its sole option, to automatically convert
(an "Automatic Conversion") all of the Notes or any portion of the principal
amount thereof that is $1,000 or an integral multiple of $1,000 at any time
prior to Maturity provided that the [Closing Price] of the Company's Common
Stock exceeds $[___] per share (the "Automatic Conversion Price") for at least
20 Trading Days during a 30-day Trading Day period, ending within five Trading
Days prior to the date of any Automatic Conversion Notice (as defined below)
provided by the Company. In the event that the date on which all or any portion
of the Notes are automatically converted (the "Automatic Conversion Date")
occurs on or prior to August [ ], 2005, the Company will also pay or provide for
the Make-Whole Payment on the Automatic Conversion Date.
(b) Unless the Company shall have previously called for redemption all
of the outstanding Notes, the Company or, at the request and expense of the
Company, the Trustee, shall
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give to all holders of Notes notice (the "Initial Automatic Conversion Notice")
of the Automatic Conversion not more than thirty (30) days but not less than
twenty (20) days prior to the Automatic Conversion Date. The Company shall also
deliver a copy of such Automatic Conversion Notice to the Trustee.
(c) Each Initial Automatic Conversion Notice shall state:
(i) the Automatic Conversion Date;
(ii) the place or places where such Notes are to be
surrendered for Automatic Conversion;
(iii) the aggregate Automatic Conversion Amount (as defined
below) then in effect;
(iv) the Make-Whole Payment amount, if any;
(v) the then current Conversion Consideration;
(vi) that the Notes called for Automatic Conversion may only
be converted for the Conversion Consideration as provided in Section
12.01;
(vii) the CUSIP number of such Note, if any; and
(viii) that a Holder of Notes who desires to convert Notes
must satisfy the requirements for conversion contained in such Notes.
(d) The Company or, at the request and expense of the Company, the
Trustee, shall give to all holders of Notes notice (the "Second Automatic
Conversion Notice") not less than fourteen (14) days prior to the Automatic
Conversion Date as to whether the Company intends to pay the Plus Cash Amount
and/or Make-Whole Payment amount in cash, in shares of Common Stock or in a
combination of cash and shares of Common Stock. Each Second Automatic Conversion
Notice shall also state:
(i) the dollar or percentage amount of the Plus Cash Amount to
be paid in cash or Plus Cash Shares;
(ii) the dollar or percentage amount of the Make-Whole Payment
amount to be paid in cash or Make-Whole Shares; and
(iii) the aggregate Automatic Conversion Amount then in
effect.
(e) If the Company elects to pay all or any part of the Plus Cash
Amount in Plus Cash Shares, or all or any part of the Make-Whole Payment amount
in Make-Whole Shares, the shares to be delivered will be valued at the greater
of (i) 95% of the Automatic Conversion Price and (ii) 95% of the simple average
of the daily volume-weighted average price of the Common Stock for the ten
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(10) Trading Days ending on and including the second Trading Day immediately
preceding the Automatic Conversion Date. The Base Shares deliverable upon an
automatic conversion and the Plus Cash Amount are hereinafter referred to as the
"Automatic Conversion Amount."
(f) In the event of an Automatic Conversion, the Company shall issue
and deliver a certificate or certificates for the number of Base Shares issuable
upon conversion of the Notes, the Plus Cash Amount and the Make-Whole Payment
amount, as applicable, due on such conversion of the Notes along with any cash
in respect of any fractional shares of Common Stock otherwise issuable upon
conversion, for payment to the holder as promptly after the Automatic Conversion
Date as practicable in accordance with the provisions of this Article 12.
(g) All Notes subject to the Automatic Conversion shall be delivered to
the Trustee to be canceled at the direction of the Trustee, which shall dispose
of the same as provided in Section 3.08 hereof.
(h) Any Automatic Conversion of less than all of the Plus Cash Notes
then outstanding will be made on a pro rata basis with reference to the
aggregate principal amount of Plus Cash Notes held by each holder of Plus Cash
Notes relative to the aggregate principal amount of Plus Cash Notes held by all
holders of Plus Cash Notes, in each case as of the Automatic Conversion Date.
(i) If any of the foregoing provisions or other provisions of this
Section 12.12 are inconsistent with applicable law at the time of such Automatic
Conversion, such law shall govern.
SECTION 12.13. Notification to Trustee. If the Company is obligated to pay any
Make-Whole Payment upon Automatic Conversion pursuant to Section 12.12(a), it
shall deliver to the Trustee a certificate setting forth (i) the amount of
interest actually paid or provided for by the Company with respect to the
affected Notes prior to the Automatic Conversion Date, and (ii) if such
Make-Whole Payment or portion thereof upon Automatic Conversion will be paid or
provided for in Common Stock, such number of Make-Whole Shares. Unless and until
the Trustee shall receive such certificate, it shall not be charged with
knowledge of the facts required by this Section 12.13 to be set forth therein.
In no event will the Trustee be required to inquire into or verify the
information required to be set forth in such certificate, other than the amount
of interest actually paid by the Trustee as paying agent with respect to the
affected Notes. The Trustee need not inquire into or confirm any amount of
interest "provided for" by the Company, unless such amount has actually been
delivered to the Trustee as paying agent and is being held by the Trustee as
paying agent pending distribution to the affected holders.
SECTION 12.14. Company's Obligation. All calculations, adjustments, conversions
and other determinations under this Article 12 shall be the sole responsibility
and obligation of the Company. The Trustee (a) shall have no obligation to
review, verify, challenge or contest any such calculation, adjustment,
conversion or other determination and (b) shall not be liable for any default or
error by the Company under this Article 12.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed all as of the day and year first above written.
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TRANSWITCH CORPORATION
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
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[If in global form, insert legend set forth in Section 2.03]
EXHIBIT A
TRANSWITCH CORPORATION
6% CONVERTIBLE PLUS CASH NOTESSM DUE 2007
No. $
CUSIP NO.
TRANSWITCH CORPORATION, a corporation duly organized and existing under the laws
of the State of Delaware (herein called the "Company," which term includes any
successor entity under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to ___________, or registered assigns,
the principal sum of _____________________________ ($____________) at the office
or agency of the Company referred to below, on August [ ], 2007 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, and to pay interest on
said principal sum semiannually on June 30 and December 31 of each year,
commencing December 31, 2003 (each an "Interest Payment Date") and beginning to
accrue as of the date this Note is first issued, at said office or agency, in
like coin or currency, at the rate of 6.0% per annum, until the principal hereof
is paid or made available for payment. The interest so payable, and punctually
paid or duly provided for, on any Interest Payment Date shall, as provided in
such Indenture, 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 Regular Record
Date for such interest, which shall be the June 15 or December 15 (whether or
not a Business Day), as the case may be, next preceding such Interest Payment
Date. Any such interest not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Note (or one or more Predecessor
Notes) is registered at the close of business on a Special Record Date for the
payment of such Defaulted Interest to be fixed by the Trustee, notice whereof
shall be given to Holders of Notes not less than 10 days prior to such Special
Record Date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Notes may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in said Indenture.
The Company may elect, solely at the Company's option, to pay interest in shares
of the Company's Common Stock, provided however that the Company shall not make
any payment of interest in shares of Common Stock unless the daily
volume-weighted average price of the Common Stock for the ten (10) Trading Days
ending on and including the second Trading Day immediately preceding the
Interest Payment Date equals or exceeds the Threshold Price (as defined in the
Indenture) per share of Common Stock. If the Company elects to make any payment
of interest in shares of Common Stock, the shares to be delivered will be valued
at 95% of the simple average of the daily volume-weighted average price of the
Common Stock for the ten (10) Trading Days ending
A-1
on and including the second Trading Day immediately preceding the Interest
Payment Date, as described in the Indenture.
Payment of the principal of, premium, if any, and interest on this Note shall be
made at the office or agency of the Company maintained for such purpose, which
initially shall be the Corporate Trust Office of the Trustee referred to on the
reverse side hereof, in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private debts,
provided that the Company may make such payment either by (i) mailing a check in
the amount of such payment, payable to or upon the written order of the Person
entitled thereto pursuant to Section 3.07 of the Indenture (as defined therein)
or (ii) transfer to an account maintained by the payee located inside the United
States.
Reference is hereby made to the further provisions of this Note set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Trustee
referred to on the reverse hereof by manual signature, this Note shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.
DATED: ______________, 2003 TRANSWITCH CORPORATION
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
Attest:
By:
-----------------------------
Name:
------------------------
Title:
-----------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned Indenture.
DATED: ________________, 2003 U.S. Bank National Association,
as Trustee
By:
------------------------------
Authorized Signatory
A-2
FORM OF REVERSE OF NOTE
TranSwitch Corporation
6% CONVERTIBLE PLUS CASH NOTESSM DUE 2007
This Note is one of a duly authorized issue of Notes of the Company designated
as its 6% Convertible Plus Cash NotesSM due 2007 (herein called the "Notes"),
limited in aggregate original principal amount to $100,000,000 as adjusted from
time to time on the books and records of the Trustee, which may be issued under
an Indenture, dated as of August __, 2003 (the "Indenture"), between the Company
and U.S. Bank National Association, as Trustee for the Holders of Notes issued
under said Indenture (herein called the "Trustee", which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee and the Holders of the Notes and of the terms upon which the Notes
are, and are to be, authenticated and delivered.
Subject to and upon compliance with the provisions of the Indenture, the Holder
of this Note is entitled, at its option, at any time on or before maturity of
the Notes, or in case this Note or a portion hereof is called for redemption,
then in respect of this Note or such portion hereof until and including, but
(unless the Company defaults in making the payment due upon redemption or
repurchase) not after, the close of business on the Business Day immediately
preceding the Redemption Date or Repurchase Date, as the case may be, to convert
this Note (or any portion of the principal amount hereof which is U.S. $1,000 or
an integral multiple thereof), at the principal amount hereof, or of such
portion, into (i) that number of fully-paid and non-assessable shares of the
Company's Common Stock as is equal to [ ] (the "Base Shares") plus (ii) $[ ]
cash (the "Plus Cash Amount").
At the Company's sole option, it may pay or provide for the Plus Cash Amount in
shares of Common Stock (the "Plus Cash Shares"); provided, however, that the
Company shall not make any payment of the Plus Cash Amount in Plus Cash Shares
unless the daily volume-weighted average price of the Common Stock for the ten
(10) Trading Days ending on and including the second Trading Day immediately
preceding the Conversion Date (as defined in the Indenture) equals or exceeds
the Threshold Price per share of Common Stock. The Common Stock deliverable upon
conversion (whether in respect of Base Shares or Plus Cash Shares, as
applicable) and any cash delivered in respect of the Plus Cash Amount are
hereafter referred to in the aggregate as the "Conversion Consideration." If the
Company elects to pay the Plus Cash Amount in Plus Cash Shares, the Plus Cash
Shares will be valued at 95% of the simple average of the daily volume-weighted
average price of the Common Stock for the ten (10) Trading Days ending on and
including the second Trading Day immediately preceding the Conversion Date. The
number of Base Shares and any calculation or determination in respect of the
simple average of the daily volume-weighted average price of the Common Stock
shall be adjusted as provided for in Article 12 of the Indenture.
A-3
From and after the delivery by the Company of any notice of Automatic Conversion
with respect to any portion of the Notes, the Holder of this Note shall be
entitled to convert this Notes (or any portion of the principal amount hereof
which is U.S. $1,000 or an integral multiple thereof) only on or after the
Automatic Conversion Date. Should the Company elects to pay the Plus Cash Amount
in shares of Plus Cash Shares, the Plus Cash Shares delivered will be valued
with respect to this Note or any portion of the principal amount hereof:
(i) if the Holder elects to convert on the Automatic Conversion Date,
at the greater of (x) 95% of the simple average of the daily volume-weighted
average price of the Common Stock for the ten (10) Trading Days ending on and
including the second Trading Day immediately preceding the Automatic Conversion
Date, or (y) 95% of the Automatic Conversion Price (as defined below); or
(ii) if the Holder elects to convert after the Automatic Conversion
Date, unless and until a subsequent Automatic Conversion Notice, if any, has
been delivered pursuant to Article 12 of the Indenture, 95% of the simple
average of the daily volume-weighted average price of the Common Stock for the
ten (10) Trading Days ending on an including the second Trading Day immediately
preceding the Conversion Date, provided, however, in the case of this clause
(ii), the Company may not pay the Plus Cash Amount in Plus Cash Shares unless
the daily volume-weighted average for the ten (10) Trading Days ending on and
including the second Trading Day immediately preceding the Conversion Date
equals or exceeds the Threshold Price.
Holders shall receive the Conversion Consideration upon surrender of this Note,
duly endorsed or assigned to the Company or in blank, to the Company at its
office or agency maintained for such purpose, accompanied by the conversion
notice hereon executed by the Holder hereof evidencing such Holder's election to
convert this Note, or if less than the entire principal amount hereof is to be
converted, the portion hereof to be converted, and, in case such surrender shall
be made during the period from the close of business on any Regular Record Date
to the opening of business on the corresponding Interest Payment Date (unless
this Note or the portion hereof being converted has been called for redemption
on a Redemption Date within such period between and including such Regular
Record Date and such Interest Payment Date), also accompanied by payment in
funds acceptable to the Company of an amount equal to the interest payable on
such Interest Payment Date on the principal amount of this Note then being
converted. Subject to the aforesaid requirement for payment of interest and, in
the case of a conversion after the close of business on any Regular Record Date
and on or before the corresponding Interest Payment Date, to the right of the
Holder of this Note (or any Predecessor Note) of record at such Regular Record
Date to receive an installment of interest (even if the Note has been called for
redemption on a Redemption Date within such period), no payment or adjustment is
to be made on conversion for interest accrued hereon or for dividends on the
Common Stock issued on conversion.
No fractions of shares or scrip representing fractions of shares will be issued
on conversion, but instead of any fractional interest the Company shall pay a
cash adjustment as provided in Article 12 of the Indenture. In addition, the
Indenture provides that in case of certain reclassifications, consolidations,
mergers, sales or transfers of assets or other transactions pursuant to
A-4
which the Common Stock is converted into the right to receive other securities,
cash or other property, the conversion privilege shall be appropriately
modified.
The Company may elect, at its sole option, to automatically convert (an
"Automatic Conversion") the Notes or any portion of the principal amount thereof
that is $1,000 or an integral multiple of $1,000 at any time prior to Maturity
(as defined in the Indenture), provided that the [Closing Price] of the
Company's Common Stock exceeds $[___] per share (the "Automatic Conversion
Price") for at least 20 Trading Days during a 30-day Trading Day period, ending
within five Trading Days prior to the date of any Automatic Conversion Notice
(as defined in the Indenture) provided by the Company. In the event that the
date on which all or any portion of the Notes will be automatically converted
(the "Automatic Conversion Date") occurs on or prior to August [ ], 2005, the
Company will also pay or provide for the Make-Whole Payment (as defined in the
Indenture) on the Automatic Conversion Date.
If the Company, in respect of an Automatic Conversion, elects to pay all or any
part of the Plus Cash Amount in Plus Cash Shares, or all or any part of the
Make-Whole Payment amount in Make-Whole Shares, the shares to be delivered will
be valued at the greater of (i) 95% of the Automatic Conversion Price and (ii)
95% of the simple average of the daily volume-weighted average price of the
Common Stock for the ten (10) Trading Days ending on and including the second
Trading Day immediately preceding the Automatic Conversion Date.
In the event of an Automatic Conversion, the Company shall issue and deliver a
certificate or certificates for the number of Base Shares issuable upon
conversion of the Note, the Plus Cash Amount and the Make-Whole Payment amount,
as applicable, due on such conversion of the Note along with any cash in respect
of any fractional shares of Common Stock otherwise issuable upon conversion, for
payment to the holder as promptly after the Automatic Conversion Date as
practicable in accordance with the provisions of Article 12 of the Indenture.
The Notes (other than those Notes that have been converted in accordance with
the terms of the Indenture) are subject to redemption at the option of the
Company upon not less than 30 days' or more than 60 days' notice by mail, as a
whole or from time to time in part, at any time after August [ ], 2005 at a
redemption price equal to 100% of the principal amount so redeemed together, in
the case of any such redemption, with accrued interest to (but excluding) the
Redemption Date (subject to the right of holders of record on the Regular Record
Date to receive interest on the related Interest Payment Date). Any redemption
of Notes must be in integral multiples of $1,000.
If fewer than all of the Notes are to be redeemed, the Trustee shall select the
Notes to be redeemed in principal amounts at maturity of $1,000 or integral
multiples thereof by lot, pro rata or by any other method that complies with the
requirements of any exchange on which the Notes are listed or quoted and that
the Trustee considers fair and appropriate. If a portion of a Holder's Notes is
selected for partial redemption and that holder converts a portion of those
Notes prior to the redemption, the converted portion shall be deemed, solely for
purposes of determining the aggregate principal amount of the Notes to be
redeemed by the Company, to be of the portion selected for redemption.
A-5
In certain circumstances involving a Repurchase Event, each Holder shall have
the right to require the Company to repurchase all or part of its Notes at a
repurchase price equal to 100% of the principal amount thereof, together with
accrued and unpaid interest through the Repurchase Date (subject to the right of
holders of record on the Regular Record Date to receive interest on the related
Interest Payment Date). The repurchase price shall be paid in cash.
The Notes do not have the benefit of any sinking fund.
In the event of redemption, conversion or repurchase of this Note in part only,
a new Note or Notes for the unredeemed, unconverted or unrepurchased portion
hereof shall be issued in the name of the Holder hereof upon the cancellation
hereof.
If an Event of Default shall occur and be continuing, the principal of all the
Notes may be declared due and payable in the manner and with the effect provided
in Article 4 of the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes under the Indenture at any
time by the Company and the Trustee with (or, in the limited circumstances set
forth in the Indenture, without) the consent of the Holders of a majority in
aggregate principal amount of the Notes at the time Outstanding. The Indenture
also contains provisions permitting the Holders of a majority in aggregate
principal amount of the Notes at the time Outstanding, on behalf of the Holders
of all the Notes, to waive compliance by the Company with certain provisions of
the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Note shall be
conclusive and binding upon such Holder and upon all future Holders of this Note
and of any Note issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Note.
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, premium, if any, and interest on
this Note at the times, place and rate, and in the coin or currency, herein
prescribed or to convert this Note as provided in the Indenture.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Note is registrable in the Note Register, upon
surrender of this Note for registration of transfer at the Corporate Trust
Office duly endorsed by, or accompanied by a written instrument of transfer in
form satisfactory to the Company and the Note Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Notes, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.
The Notes are issuable only in registered form without coupons in denominations
of $1,000 and any integral multiple thereof.
A-6
No service charge shall be made to a Holder for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the Company,
the Trustee and any agent of the Company or the Trustee may treat the Person in
whose name this Note is registered as the owner hereof for all purposes and
neither the Company, the Trustee nor any such agent shall be affected by notice
to the contrary.
Interest on this Note will accrue from the most recent date to which interest
has been paid, or if no interest has been paid, from August [ ], 2003. Interest
shall be computed on the basis of a 360-day year of twelve 30-day months. In the
event that any date on which interest is payable on the Notes is not a Business
Day, then payment of interest payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or other
payment in respect of any such delay).
All terms used in this Note which are defined in the Indenture shall have the
meanings assigned to them in the Indenture.
THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES.
A-7
FORM OF TRANSFER NOTICE
FOR VALUE RECEIVED, the undersigned registered holder hereby sell(s), assign(s)
and transfer(s) unto
Insert Taxpayer Identification No.
----------------------------------
-------------------------------------------------------------------------
Please print or typewrite name and address including zip code of assignee
-------------------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing __________________________________ attorney to transfer said Note on
the books of the Company with full power of substitution in the premises.
A-8
CONVERSION NOTICE
To: TRANSWITCH CORPORATION
The undersigned Holder of this Note hereby irrevocably exercises the option to
convert this Note, or the portion hereof (which is $1,000 or an integral
multiple thereof) below designated, at any time following the date of original
issuance thereof, into shares of Common Stock plus cash in accordance with the
terms of the Indenture referred to in this Note, and directs that the shares
issuable and deliverable upon conversion, together with any check in payment for
a fractional share and/or the plus cash amount, as applicable, and any Note
representing any unconverted principal amount hereof, be issued and delivered to
the registered owner hereof unless a different name has been provided 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 and is delivering herewith a certificate in proper
form certifying that the applicable restrictions on transfer have been complied
with. Any amount required to be paid by the undersigned on account of interest
accompanies this Note.
Dated: By:
---------------------
Signature of Registered Holder*
If shares or Notes are to be Principal amount to be
registered in the name of a converted (if less than all):
Person other than the Holder, $______,000
please print such Person's
name and address:
--------------------------------
Name
--------------------------------
Social Security or Taxpayer
Identification Number
--------------------------------
Street Address
--------------------------------
City, State and Zip Code
* 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 delivered,
or unconverted Notes are to be issued, other than to and in the name of the
registered owner.
1
ELECTION OF HOLDER TO REQUIRE REPURCHASE
(1) Pursuant to Article 11 of the Indenture, the undersigned hereby elects to
have this Note repurchased by the Company.
(2) The undersigned hereby directs the Trustee or the Company to pay it or
______________ an amount in cash equal to 100% of the principal amount to be
repurchased (as set forth below), plus interest accrued to the Repurchase Date,
as provided in the Indenture.
Dated:
----------------------------------------
----------------------------------------
Signature(s)
Signature(s) must be guaranteed by an
Eligible Guarantor Institution with
membership in an approved signature
guarantee program pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934.
----------------------------------------
Signature Guaranteed
Principal amount to be repurchased (at least
U.S. $1,000 or an integral multiple of $1,000
in excess thereof):
------------------
Remaining principal amount following such
repurchase (not less than U.S. $1,000):
--------------
NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
