EXHIBIT 4.1
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Electroglas Inc., Issuer
The Bank of New York,
as Trustee
INDENTURE
Dated as of June 21, 2002
5.25% Convertible Subordinated Notes due 2007
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CROSS-REFERENCE SHEET*
Provisions of Trust Indenture Act of 1939 and Indenture, dated as of
June 21, 2002, between Electroglas, Inc. and The Bank of New York, as Trustee,
providing for the 5.25% Convertible Subordinated Notes due 2007:
Section of the Act Section of Indenture
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310(a)(1) and (2)............................ 8.9
310(a)(3) and (4)............................ N.A.**
310(b)....................................... 8.8 and 8.10(b) and (d)
310(c)....................................... N.A.
311(a)....................................... 8.13
311(b)....................................... 8.13
311(c)....................................... N.A.
312(a)....................................... 6.1 and 6.2(a)
312(b)....................................... 6.2(b)
312(c)....................................... 6.2(c)
313(a)....................................... 6.3(a)
313(b)(1).................................... N.A.
313(b)(2).................................... 6.3(a)
313(c)....................................... 6.3(a)
313(d)....................................... 6.3(b)
314(a)....................................... 6.4
314(b)....................................... N.A.
314(c)(1) and (2)............................ 17.5
314(c)(3).................................... N.A.
314(d)....................................... N.A.
314(e)....................................... 17.5
314(f)....................................... N.A.
315(a), (c) and (d).......................... 8.1
315(b)....................................... 7.8
315(e)....................................... 7.9
316(a)(1).................................... 7.7
316(a)(2).................................... Not required
316(a) (last sentence)....................... 9.4
316(b)....................................... 11.2
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* This Cross-Reference Table shall not, for any purpose, be deemed a part of
this Indenture.
** N.A. means Not Applicable.
TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS........................................................... 1
Section 1.1 Definitions............................................... 1
Section 1.2 Other Definitions......................................... 7
Section 1.3 Rules of Construction..................................... 8
ARTICLE II ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES.... 8
Section 2.1 Designation, Amount and Issue of Notes.................... 8
Section 2.2 Form of Notes............................................. 9
Section 2.3 Date and Denomination of Notes; Payments of Interest...... 10
Section 2.4 Execution of Notes........................................ 11
Section 2.5 Exchange and Registration of Transfer of Notes;
Restrictions on Transfer.................................. 11
Section 2.6 Mutilated, Destroyed, Lost or Stolen Notes................ 25
Section 2.7 Temporary Notes........................................... 26
Section 2.8 Cancellation of Notes Paid, Etc. ......................... 26
Section 2.9 CUSIP Numbers............................................. 26
ARTICLE III OPTIONAL REDEMPTION OF NOTES........................................ 27
Section 3.1 Redemption Price.......................................... 27
Section 3.2 Notice of Redemption; Selection of Notes.................. 27
Section 3.3 Payment of Notes Called for Redemption.................... 28
Section 3.4 Conversion Arrangement on Call for Redemption............. 29
ARTICLE IV SUBORDINATION........................................................ 30
Section 4.1 Subordination to Senior Indebtedness...................... 30
Section 4.2 No Payment if Default in Senior Indebtedness.............. 31
Section 4.3 Payment upon Dissolution, Etc. ........................... 32
Section 4.4 Payments on Notes......................................... 32
Section 4.5 Certain Conversions Deemed Payment........................ 32
Section 4.6 Subrogation............................................... 33
Section 4.7 Rights of Holders Unimpaired.............................. 33
Section 4.8 Holders of Senior Indebtedness............................ 33
Section 4.9 Trustee Not Fiduciary for Holders of Senior Indebtedness.. 34
Section 4.10 Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights.......................... 34
ARTICLE V PARTICULAR COVENANTS OF THE COMPANY................................... 34
Section 5.1 Payment of Principal, Premium and Interest................ 34
Section 5.2 Maintenance of Office or Agency........................... 35
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Section 5.3 Appointments to Fill Vacancies in Trustee's Office........ 35
Section 5.4 Provisions as to Paying Agent............................. 35
Section 5.5 Existence................................................. 36
Section 5.6 Information Requirement................................... 37
Section 5.7 Stay, Extension and Usury Laws............................ 37
Section 5.8 Compliance Certificate.................................... 37
Section 5.9 Further Instruments and Acts.............................. 38
ARTICLE VI NOTEHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE........ 38
Section 6.1 Noteholders Lists......................................... 38
Section 6.2 Preservation and Disclosure of Lists...................... 38
Section 6.3 Reports by Trustee........................................ 38
Section 6.4 Reports by Company........................................ 39
ARTICLE VII DEFAULTS AND REMEDIES............................................... 40
Section 7.1 Events of Default......................................... 40
Section 7.2 Payments of Notes on Default; Suit Therefor............... 43
Section 7.3 Application of Monies Collected by Trustee................ 44
Section 7.4 Proceedings by Noteholder................................. 45
Section 7.5 Proceedings by Trustee.................................... 46
Section 7.6 Remedies Cumulative and Continuing........................ 46
Section 7.7 Direction of Proceedings and Waiver of Defaults by
Majority of Noteholders................................... 46
Section 7.8 Notice of Defaults........................................ 47
Section 7.9 Undertaking to Pay Costs.................................. 47
Section 7.10 Delay or Omission Not Waiver.............................. 48
ARTICLE VIII CONCERNING THE TRUSTEE............................................. 48
Section 8.1 Duties and Responsibilities of Trustee.................... 48
Section 8.2 Reliance on Documents, Opinions, Etc. .................... 49
Section 8.3 No Responsibility for Recitals, Etc. ..................... 51
Section 8.4 Trustee, Paying Agents, Conversion Agents or Registrar May
Own Notes................................................. 51
Section 8.5 Monies to be Held in Trust................................ 51
Section 8.6 Compensation and Expenses of Trustee...................... 51
Section 8.7 Officer's Certificate as Evidence......................... 52
Section 8.8 Conflicting Interests of Trustee.......................... 52
Section 8.9 Eligibility of Trustee.................................... 52
Section 8.10 Resignation or Removal of Trustee......................... 52
Section 8.11 Acceptance by Successor Trustee........................... 54
Section 8.12 Succession by Merger, Etc. ............................... 54
Section 8.13 Limitation on Rights of Trustee as Creditor............... 55
ARTICLE IX CONCERNING THE NOTEHOLDERS........................................... 55
Section 9.1 Action by Noteholders..................................... 55
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Section 9.2 Proof of Execution by Noteholders......................... 55
Section 9.3 Who Are Deemed Absolute Owners............................ 56
Section 9.4 Company-Owned Notes Disregarded........................... 56
Section 9.5 Revocation of Consents; Future Holders Bound.............. 56
ARTICLE X NOTEHOLDERS' MEETINGS................................................. 57
Section 10.1 Purpose of Meetings....................................... 57
Section 10.2 Call of Meetings by Trustee............................... 57
Section 10.3 Call of Meetings by Company or Noteholders................ 58
Section 10.4 Qualifications for Voting................................. 58
Section 10.5 Regulations............................................... 58
Section 10.6 Voting.................................................... 59
Section 10.7 No Delay of Rights by Meeting............................. 59
ARTICLE XI AMENDMENTS; SUPPLEMENTAL INDENTURES.................................. 59
Section 11.1 Amendments; Supplemental Indentures without Consent of
Noteholders............................................... 59
Section 11.2 Amendments; Supplemental Indentures with Consent of
Noteholders............................................... 61
Section 11.3 Effect of Amendments and Supplemental Indentures.......... 61
Section 11.4 Notation on Notes......................................... 62
Section 11.5 Evidence of Compliance of Amendment or Supplemental
Indenture to be Furnished to Trustee...................... 62
ARTICLE XII CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE................... 62
Section 12.1 Company May Consolidate, Etc. ............................ 62
Section 12.2 Successor Entity to be Substituted........................ 63
Section 12.3 Opinion of Counsel to be Given Trustee.................... 64
ARTICLE XIII SATISFACTION AND DISCHARGE OF INDENTURE............................ 64
Section 13.1 Discharge of Indenture.................................... 64
Section 13.2 Deposited Monies to be Held in Trust by Trustee........... 65
Section 13.3 Paying Agent to Repay Monies Held......................... 65
Section 13.4 Return of Unclaimed Monies................................ 65
Section 13.5 Reinstatement............................................. 65
ARTICLE XIV NO RECOURSE AGAINST OTHERS.......................................... 66
Section 14.1 Indenture and Notes Solely Corporate Obligations.......... 66
ARTICLE XV CONVERSION OF NOTES.................................................. 66
Section 15.1 Right to Convert.......................................... 66
Section 15.2 Exercise of Conversion Privilege; Issuance of Common Stock
on Conversion............................................. 67
Section 15.3 Cash Payments in Lieu of Fractional Shares................ 69
Section 15.4 Conversion Price.......................................... 70
Section 15.5 Adjustment of Conversion Price............................ 70
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Section 15.6 One-Time Conversion Price Adjustment...................... 77
Section 15.7 Effect of Reclassification, Consolidation, Merger or Sale. 78
Section 15.8 Taxes on Shares Issued.................................... 79
Section 15.9 Reservation of Shares; Shares to be Fully Paid; Listing of
Common Stock.............................................. 79
Section 15.10 Responsibility of Trustee................................. 80
Section 15.11 Notice to Holders Prior to Certain Actions................ 81
Section 15.12 Company Right to Force Automatic Conversion............... 82
ARTICLE XVI REPURCHASE UPON A REPURCHASE EVENT.................................. 83
Section 16.1 Repurchase Right.......................................... 83
Section 16.2 Notices; Method of Exercising Repurchase Right, Etc. ..... 84
Section 16.3 Certain Definitions....................................... 85
ARTICLE XVII MISCELLANEOUS PROVISIONS........................................... 87
Section 17.1 Provisions Binding on Company's Successors................ 87
Section 17.2 Official Acts by Successor Corporation.................... 87
Section 17.3 Addresses for Notices, Etc. .............................. 87
Section 17.4 Governing Law............................................. 88
Section 17.5 Evidence of Compliance with Conditions Precedent;
Certificates to Trustee................................... 88
Section 17.6 Legal Holidays............................................ 89
Section 17.7 No Security Interest Created.............................. 89
Section 17.8 Trust Indenture Act....................................... 89
Section 17.9 Benefits of Indenture..................................... 89
Section 17.10 Table of Contents, Headings, Etc. ........................ 89
Section 17.11 Authenticating Agent...................................... 90
Section 17.12 Execution in Counterparts................................. 90
Section 17.13 No Adverse Interpretation of Other Agreements............. 90
EXHIBIT A Form of 5.25% Convertible Subordinated Note due 2007
A - Form of Conversion Notice
B - Form of Option to Elect Repayment Upon a Repurchase Event
C - Form of Certificate of Transfer
D - Form of Certificate of Exchange
E - Form of Transfer Letter of Representations
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INDENTURE dated as of June 21, 2002 between Electroglas, Inc., a
Delaware corporation (hereinafter sometimes called the "Company", as more fully
set forth in Section 1.1), and The Bank of New York, a New York banking
corporation, as trustee (hereinafter sometimes called the "Trustee", as more
fully set forth in Section 1.1).
W I T N E S S E T H:
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the issue of its 5.25% Convertible Subordinated Notes due 2007
(hereinafter sometimes called the "Notes"), in an aggregate principal amount not
to exceed $35,500,000 and to provide the terms and conditions upon which the
Notes are to be authenticated, issued and delivered, the Company has duly
authorized the execution and delivery of this Indenture; and
WHEREAS, the Notes, the certificate of authentication to be borne by the
Notes, a form of assignment, a form of option to elect repayment upon a
Repurchase Event, and a form of conversion notice and transfer to be borne by
the Notes are to be substantially in the forms hereinafter provided for; and
WHEREAS, all acts and things necessary to make the Notes, when executed
by the Company and authenticated and delivered by the Trustee or a duly
authorized authenticating agent, as provided in this Indenture, the valid,
binding and legal obligations of the Company, and to constitute these presents a
valid agreement according to its terms, have been done and performed, and the
execution of this Indenture and the issue hereunder of the Notes have in all
respects been duly authorized.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That in order to declare the terms and conditions upon which the Notes
are, and are to be, authenticated, issued and delivered, and in consideration of
the premises and of the purchase and acceptance of the Notes by the holders
thereof, the Company covenants and agrees with the Trustee for the equal and
proportionate benefit of the respective holders from time to time of the Notes
(except as otherwise provided below), as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions
144A Global Note: The term "144A Global Note" means a global note
substantially in the form of Exhibit A hereto bearing the Global Note Legend and
the Private Placement Legend and deposited with or on behalf of, and registered
in the name of, the Depositary or its nominee that will be issued in a
denomination equal to the outstanding principal amount of the Notes sold in
reliance on Rule 144A.
Affiliate: The term "Affiliate" of any specified Person shall mean any
other person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person. For the purposes of this
definition, "control," when used with respect to any specified Person means the
power to direct or cause the direction of the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Applicable Procedures: The term "Applicable Procedures" shall mean, with
respect to any transfer or exchange of beneficial ownership interests in a
Global Note, the rules and procedures of the Depositary that are applicable to
such transfer or exchange.
Board of Directors: The term "Board of Directors" shall mean the Board
of Directors of the Company or a committee of such Board duly authorized to act
for it hereunder.
Board Resolution: The term "Board Resolution" means a copy of a
resolution certified by the Secretary or an Assistant Secretary of the Company
to have been duly adopted by the Board of Directors, or duly authorized
committee thereof (to the extent permitted by applicable law), and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.
Business Day: The term "Business Day" means each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which the banking
institutions in The City of New York or the city in which the Corporate Trust
Office is located are authorized or obligated by law or executive order to close
or be closed.
Close of business: The term "close of business" means 5 p.m. (New York
City time).
Commission: The term "Commission" shall mean the Securities and Exchange
Commission.
Common Stock: The term "Common Stock" shall mean any stock of any class
of the Company which has no preference in respect of dividends or of amounts
payable in the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and which is not subject to redemption by the Company.
Subject to the provisions of Section 15.7, however, shares issuable on
conversion of Notes shall include only shares of the class designated as common
stock of the Company at the date of this Indenture or shares of any class or
classes resulting from any reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which are not subject to redemption by the Company; provided
that if at any time there shall be more than one such resulting class, the
shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from all
such reclassifications bears to the total number of shares of all such classes
resulting from all such reclassifications.
Company: The term "Company" shall mean Electroglas, Inc., a Delaware
corporation, and subject to the provisions of Article XII, shall include its
successors and assigns.
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Corporate Trust Office: The term "Corporate Trust Office," or other
similar term, shall mean the office of the Trustee at which at any particular
time its corporate trust business shall be principally administered, which
office is, at the date as of which this Indenture is dated, located at 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust
Administration.
Custodian: The term "Custodian" shall mean the Trustee, as custodian
with respect to the Notes in global form, or any successor entity thereto.
Default: The term "default" shall mean any event that is, or after
notice or passage of time, or both, would be, an Event of Default.
Definitive Note: The term "Definitive Note" shall mean a certificated
Note registered in the name of the holder thereof and issued in accordance with
Section 2.5, substantially in the form of Exhibit A hereto except that such Note
shall not bear the Global Note Legend and shall not have the "Schedule of
Exchanges of Interests in the Global Note" attached thereto.
Depositary: The term "Depositary" shall mean, with respect to the Notes
issuable or issued in whole or in part in global form, the Person specified in
Section 2.5(a) as the Depositary with respect to the Notes, and any and all
successors thereto appointed as depositary hereunder and having become such
pursuant to the applicable provision of this Indenture.
Designated Senior Debt: The term "Designated Senior Debt" shall mean any
Senior Indebtedness consisting of indebtedness for borrowed money which, at the
time of determination, has an aggregate principal amount of at least $3,000,000
if the instrument creating or evidencing the same or the assumption or guarantee
thereof (or related agreements or documents to which the Company is a party)
expressly provides that such indebtedness shall be "Designated Senior Debt" for
purposes of this Indenture (provided that such instrument, agreement or other
document may place limitations and conditions on the right of the holders of
such Senior Indebtedness to exercise the rights of holders of Designated Senior
Debt). If any payment made to any holder of any Designated Senior Debt with
respect to such Designated Senior Debt is rescinded or must otherwise be
returned by such holder upon the insolvency, bankruptcy or reorganization of the
Company or otherwise, the reinstated indebtedness of the Company arising as a
result of such rescission or return shall constitute Designated Senior Debt
effective as of the date of such rescission or return.
Equity Interests: The term "Equity Interests" shall mean capital stock
or warrants, options or other rights to acquire capital stock (but excluding any
debt security which is convertible into, or exchangeable for, capital stock).
Event of Default: The term "Event of Default" shall mean any event
specified in Section 7.1, continued for the period of time, if any, and after
the giving of notice, if any, therein designated.
Exchange Act: The term "Exchange Act" means the Securities Exchange Act
of 1934, as amended, and the rules and regulations promulgated thereunder.
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Global Notes: The term "Global Notes" shall mean, individually and
collectively, each of the Restricted Global Notes and the Unrestricted Global
Notes, substantially in the form of Exhibit A hereto issued in accordance with
Section 2.2, 2.5(c)(iv) or 2.5(e)(ii).
Global Note Legend: The term "Global Note Legend" shall mean the legend
set forth in Section 2.5(h)(iii), which is required to be placed on all Global
Notes issued under this Indenture.
IAI Global Note: The term "IAI Global Note" shall mean the Global Note
substantially in the form of Exhibit A hereto bearing the Global Note Legend and
the Private Placement Legend and deposited with or on behalf of and registered
in the name of the Depositary or its nominee that shall be issued in a
denomination equal to the outstanding principal amount of the Notes held by
Institutional Accredited Investors.
Indenture: The term "Indenture" shall mean this instrument as originally
executed or, if amended or supplemented as herein provided, as so amended or
supplemented.
Individual Accredited Investor: The term "Individual Accredited
Investor" shall mean an individual "accredited investor" as defined in Rule
501(a) (5) or (6) of Regulation D under the Securities Act.
Indirect Participant: The term "Indirect Participant" shall mean a
Person who holds a beneficial interest in a Global Note through a Participant.
Institutional Accredited Investor: The term "Institutional Accredited
Investor" shall mean an institutional "accredited investor" as such term is
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act or any
entity in which all of the equity owners are accredited investors within the
meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
Liquidated Damages: The term "Liquidated Damages" means all liquidated
damages then owing pursuant to Section 2(f) of the Registration Rights Agreement
and Section 15.2.
Note or Notes: The terms "Note" or "Notes" shall mean any Note or Notes,
as the case may be, authenticated and delivered under this Indenture.
Noteholder or holder: The terms "Noteholder" or "holder" as applied to
any Note, or other similar terms (but excluding the term "beneficial holder"),
shall mean any Person in whose name at the time a particular Note is registered
on the Note register.
Officer's Certificate: The term "Officer's Certificate", when used with
respect to the Company, shall mean a certificate signed by one of the President,
the Chief Executive Officer, Chief Financial Officer, Executive or Senior Vice
President or any Vice President, that is delivered to the Trustee. Each such
certificate shall include the statements provided for in Section 17.5 if and to
the extent required by the provisions of such Section.
Opinion of Counsel: The term "Opinion of Counsel" shall mean an opinion
in writing signed by legal counsel, who may be an employee of or counsel to the
Company, which is
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delivered to the Trustee. Each such opinion shall include the statements
provided for in Section 17.5 if and to the extent required by the provisions of
such Section.
Outstanding: The term "outstanding," when used with reference to Notes,
shall, subject to the provisions of Section 9.4, mean, as of any particular
time, all Notes authenticated and delivered by the Trustee under this Indenture,
except:
(a) Notes theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(b) Notes, or portions thereof, for the payment, or redemption of
which monies in the necessary amount shall have been deposited in trust
with the Trustee or with any paying agent (other than the Company) or
shall have been set aside and segregated in trust by the Company (if the
Company shall act as its own paying agent); provided that if such Notes
are to be redeemed, as the case may be, prior to the maturity thereof,
notice of such redemption shall have been given as provided in Section
3.2, or provision satisfactory to the Trustee shall have been made for
giving such notice;
(c) Notes paid pursuant to Section 2.6 and Notes in lieu of
which, or in substitution for which, other Notes shall have been
authenticated and delivered pursuant to the terms of Section 2.6 unless
proof satisfactory to the Trustee is presented that any such Notes are
held by bona fide holders in due course; and
(d) Notes converted into Common Stock pursuant to Article XV and
Notes deemed not outstanding pursuant to Section 3.2.
Participant: The term "Participant" shall mean, with respect to the
Depositary, a Person who has an account with the Depositary.
Person: The term "Person" shall mean an individual, a corporation, a
limited liability company, an association, a partnership, a joint venture, a
joint stock company, a trust, an unincorporated organization or a government or
an agency or a political subdivision thereof.
Predecessor Note: The term "Predecessor Note" of any particular Note
shall mean every previous Note evidencing all or a portion of the same debt as
that evidenced by such particular Note; and, for the purposes of this
definition, any Note authenticated and delivered under Section 2.6 in lieu of a
lost, destroyed or stolen Note shall be deemed to evidence the same debt as the
lost, destroyed or stolen Note that it replaces.
Private Placement Legend: The term "Private Placement Legend" shall mean
the legend set forth in Section 2.5(h)(i) to be placed on all Notes issued under
this Indenture except where otherwise permitted by the provisions of this
Indenture.
QIB: The term "QIB" shall mean a "qualified institutional buyer" as
defined in Rule 000X.
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Xxxxxxxxxxxx Rights Agreement: The term "Registration Rights Agreement"
means that certain Registration Rights Agreement, dated as of June 19, 2002,
among the Company and the initial purchasers of the Notes and Warrants, as such
agreement may be amended from time to time.
Responsible Officer: The term "Responsible Officer", when used with
respect to the Trustee, shall mean an officer of the Trustee in the Corporate
Trust Office assigned and duly authorized by the Trustee to administer its
obligations under this Indenture.
Restricted Definitive Note: The term " Restricted Definitive Note" means
a Definitive Note bearing the Private Placement Legend.
Restricted Global Note: The term "Restricted Global Note" shall mean a
Global Note bearing the Private Placement Legend.
Rule 144: The term "Rule 144" shall mean Rule 144 promulgated under the
Securities Act.
Rule 144A: The term "Rule 144A" shall mean Rule 144A promulgated under
the Securities Act.
Securities Act: The term "Securities Act" means the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder.
Securities Purchase Agreement: The term "Securities Purchase Agreement"
means that certain Securities Purchase Agreement, dated as of June 19, 2002,
among the Company and the parties listed on the Schedule of Buyers attached
thereto as Exhibit A, as such agreement may be amended from time to time.
Significant Subsidiary: The term "Significant Subsidiary" means, with
respect to any Person, a Subsidiary of such Person that would constitute a
"significant subsidiary" as such term is defined under Rule 1-02 of Regulation
S-X of the Commission.
Subsidiary: The term "Subsidiary" means a Person more than 50% of the
outstanding voting stock or Equity Interests of which is owned, directly or
indirectly, by the Company or by one or more other Subsidiaries, or by the
Company and one or more other Subsidiaries. For the purposes of this definition,
"voting stock" means stock which ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class of stock has
such voting power by reason of any contingency.
Transaction Documents: The term "Transaction Documents" shall mean the
Securities Purchase Agreement, the Registration Rights Agreement, the Notes, the
Warrants and each of the other agreements entered into by the parties thereto in
connection with the transactions contemplated by the Securities Purchase
Agreement.
Trust Indenture Act: The term "Trust Indenture Act" shall mean the Trust
Indenture Act of 1939, as amended, as it was in force at the date of execution
of this Indenture, except as
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provided in Sections 11.3 and 15.7; provided, however, that in the event the
Trust Indenture Act of 1939 is amended after the date hereof, the term "Trust
Indenture Act" shall mean, to the extent required by such amendment, the Trust
Indenture Act of 1939 as so amended.
Trustee: The term "Trustee" shall mean The Bank of New York and its
successors and any corporation resulting from or surviving any consolidation or
merger to which it or its successors may be a party and any successor trustee at
the time serving as successor trustee hereunder.
Unrestricted Global Note: The term "Unrestricted Global Note" shall mean
a permanent Global Note substantially in the form of Exhibit A attached hereto
that bears the Global Note Legend and that has the "Schedule of Exchanges of
Interests in the Global Note" attached thereto, and that is deposited with or on
behalf of and registered in the name of the Depositary, representing a series of
Notes that do not bear the Private Placement Legend.
Unrestricted Definitive Note: The term "Unrestricted Definitive Note"
shall mean one or more Definitive Notes that do not bear and are not required to
bear the Private Placement Legend.
Warrants: The term "Warrants" shall mean the warrants to purchase shares
of Common Stock issued pursuant to the Securities Purchase Agreement and all
warrants issued in exchange, transfer or replacement thereof.
Section 1.2 Other Definitions
Defined in
Term Section
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"Agent Members"................................... 2.2(b)
"Authentication Order"............................ 2.1
"Automatic Conversion"............................ 15.12
"Automatic Conversion Notice"..................... 15.12
"Change in Control"............................... 16.3
"Closing Price"................................... 15.5(f)
"Company Conversion Provisional Payment" ......... 15.12
"Company Notice".................................. 16.2(a)
"Continuing Director"............................. 16.3
"Conversion Date"................................. 15.2
"Conversion Price"................................ 15.4
"Conversion Shares"............................... 15.11
"Current Market Price"............................ 15.5(f)
"fair market value"............................... 15.5(f)
"Holder Conversion Provisional Payment" .......... 15.1
"non-electing share".............................. 15.7
"Note register"................................... 2.5(a)
"Note registrar".................................. 2.5(a)
"Payment Blockage Notice"......................... 4.2
"Payment Blockage Period"......................... 4.2
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Defined in
Term Section
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"Payment Default"................................. 4.2
"Proceeding"...................................... 4.3
"Record Date"..................................... 2.3
"record date"..................................... 15.5(d)
"Reference Period"................................ 15.5(d)
"Repurchase date"................................. 16.1
"Repurchase Event"................................ 16.3
"Repurchase Price"................................ 16.1
"Restricted Securities"........................... 2.5(h)(i)
"Securities"...................................... 15.5(d)
"Senior Indebtedness"............................. 4.1
"Statutory Exchange".............................. 15.7
"Termination of Trading".......................... 16.3
"Trading Day"..................................... 15.5(f)
"Trigger Event"................................... 15.5(d)
"Vice President".................................. 2.1
"Voting Stock".................................... 16.3
Section 1.3 Rules of Construction
All other terms used in this Indenture, which are defined in the Trust
Indenture Act or which are by reference therein defined in the Securities Act
(except as herein otherwise expressly provided or unless the context otherwise
requires) shall have the meanings assigned to such terms in said Trust Indenture
Act and in said Securities Act as in force at the date of the execution of this
Indenture. The words "herein," "hereof," "hereunder," and words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or other Subdivision. The terms defined in this Article I include the
plural as well as the singular.
ARTICLE II
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES
Section 2.1 Designation, Amount and Issue of Notes
The Notes shall be designated as "5.25% Convertible Subordinated Notes
due 2007." Notes not to exceed the aggregate principal amount of $35,500,000
upon the execution of this Indenture, or (except pursuant to Sections 2.5, 2.6,
3.3, 15.2 and 16.2) from time to time thereafter, may be executed by the Company
and delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Notes upon the written order of the Company (the
"Authentication Order"), signed by the Company's (a) President, Chief Executive
Officer, Executive or Senior Vice President or any Vice President (whether or
not designated by a number or numbers or word or words added before or after the
title "Vice President") and
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(b) Chief Financial Officer, Treasurer or Assistant Treasurer or its Secretary
or any Assistant Secretary, without any further action by the Company hereunder.
Section 2.2 Form of Notes
(a) Notes issued in global form shall be substantially in the
form of Exhibit A attached hereto (including the Global Note Legend
thereon and the "Schedule of Exchanges of Interests in the Global Note"
attached thereto), which is incorporated in and made a part of this
Indenture. Notes issued in definitive form shall be substantially in the
form of Exhibit A attached hereto (but without the Global Note Legend
thereon and without the "Schedule of Exchanges of Interests in the
Global Note" attached thereto). Each Global Note shall represent such of
the outstanding Notes as shall be specified therein and each shall
provide that it shall represent the aggregate principal amount of
outstanding Notes from time to time endorsed thereon and that the
aggregate principal amount of outstanding Notes represented thereby may
from time to time be reduced or increased, as appropriate, to reflect
purchases, conversions and redemptions. Any endorsement of a Global Note
to reflect the amount of any decrease or increase in the aggregate
principal amount of outstanding Notes represented thereby shall be made
by the Trustee or the Custodian, at the direction of the Trustee, in
accordance with instructions given by the holder thereof as required by
Section 2.5.
The Trustee's certificate of authentication to be borne by such
Notes shall be substantially in the form set forth in Exhibit A.
Any of the Notes may have such letters, numbers or other marks of
identification and such notations, legends and endorsements as the
officers executing the same may approve (execution thereof to be
conclusive evidence of such approval) and as are not inconsistent with
the provisions of this Indenture, or as may be required to comply with
any law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any securities exchange or automated quotation
system on which the Notes may be listed or designated for issuance, or
to conform to usage.
The terms and provisions contained in the form of Note attached
as Exhibit A hereto shall constitute, and is hereby expressly made, a
part of this Indenture and to the extent applicable, the Company and the
Trustee, by their execution and delivery of this Indenture, expressly
agree to such terms and provisions and to be bound thereby.
(b) Members of, or Participants in, the Depositary ("Agent
Members") shall have no rights under this Indenture with respect to any
Global Note held on their behalf by the Depositary or under any Global
Note, and the Depositary (including, for this purpose, its nominee) may
be treated by the Company, the Trustee and any agent of the Company or
the Trustee as the absolute owner and holder of such Global Note for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
(i) 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 the Depositary or
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(ii) impair, as between the Depositary and its Agent Members, the
operation of customary practices governing the exercise of the rights of
a holder of any Note.
Section 2.3 Date and Denomination of Notes; Payments of Interest. The
Notes shall be issuable in registered form without coupons in denominations of
$1,000 principal amount and integral multiples thereof. Every Note shall be
dated the date of its authentication, and shall bear interest from the
applicable date and accrued interest shall be payable on each June 15 and
December 15 of each year, commencing December 15, 2002, as specified on the face
of the form of Note attached as Exhibit A hereto.
Interest on the Notes shall be deemed to have commenced accruing on June
21, 2002.
The Person in whose name any Note, or portion thereof (or its
Predecessor Note) is registered at the close of business on any record date with
respect to any interest payment date (including any Note that is converted after
the record date and on or before the interest payment date) shall be entitled to
receive the interest payable on such interest payment date notwithstanding the
cancellation of such Note upon any transfer, exchange or conversion subsequent
to the record date and on or prior to such interest payment date; provided that,
in the case of any Note, or portion thereof, called for redemption or converted
pursuant to Article III or Article XV on a redemption date or conversion date,
as applicable, or repurchased by the Company pursuant to Article XVI on a
repurchase date, during the period from the close of business on the record date
to the close of business on the Business Day next preceding the following
interest payment date, interest shall not be paid to the Person in whose name
the Note, or portion thereof, is registered on the close of business on such
record date, and the Company shall have no obligation to pay interest on such
Note or portion thereof except to the extent required to be paid upon such
redemption, conversion or repurchase in accordance with Article III, Article XV
or Article XVI. Interest may, at the option of the Company, be paid by check
mailed to the address of such Person on the Note registry; provided that, with
respect to any holder of Notes with an aggregate principal amount equal to or in
excess of $500,000, at the request of such holder in writing to the Company,
interest on such holder's Notes shall be paid by wire transfer in immediately
available funds to any bank located in the United States in accordance with the
wire transfer instruction supplied by such holder from time to time to the
Trustee and paying agent (if different from Trustee) at least two (2) Business
Days prior to the applicable record date. The term "record date" with respect to
any interest payment date shall mean the June 1 or December 1 preceding said
June 15 or December 15, respectively.
Interest on the Notes shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 7.1 hereof. The Company shall promptly 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. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special
record date shall be less than ten (10) days prior
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to the related payment date for such defaulted interest. At least fifteen (15)
days before the special record date, the Company (or, upon the written request
of the Company, the Trustee in the name and at the expense of the Company) shall
mail or cause to be mailed to holders a notice that states the special record
date, the related payment date and the amount of such interest to be paid.
Section 2.4 Execution of Notes
The Notes shall be signed in the name and on behalf of the Company by
the facsimile signature of its President, its Chief Executive Officer, or any of
its Vice Presidents, and attested by the facsimile signature of its Chief
Financial Officer, Treasurer or its Assistant Treasurer, or Secretary or any of
its Assistant Secretaries (which may be printed, engraved or otherwise
reproduced thereon, by facsimile or otherwise). Only such Notes as shall bear
thereon a certificate of authentication substantially in the form set forth on
the form of Note attached as Exhibit A hereto, manually executed by the Trustee
(or an authenticating agent appointed by the Trustee as provided by Section
17.11), shall be entitled to the benefits of this Indenture or be valid or
obligatory for any purpose. Such certificate by the Trustee (or such
authenticating agent) upon any Note executed by the Company shall be conclusive
evidence that the Note so authenticated has been duly authenticated and
delivered hereunder and that the holder thereof is entitled to the benefits of
this Indenture.
In case any officer of the Company who shall have signed any of the
Notes shall cease to be such officer before the Notes so signed shall have been
authenticated and delivered by the Trustee, or disposed of by the Company, such
Notes nevertheless may be authenticated and delivered or disposed of as though
the person who signed such Notes had not ceased to be such officer of the
Company; and any Note may be signed on behalf of the Company by such persons as,
at the actual date of the execution of such Note, shall be the proper officers
of the Company, although at the date of the execution of this Indenture any such
person was not such an officer.
Section 2.5 Exchange and Registration of Transfer of Notes; Restrictions
on Transfer
(a) Note Register. The Company shall cause to be kept at the
Corporate Trust Office a register (the register maintained in such
office and in any other office or agency of the Company designated
pursuant to Section 5.2 being herein sometimes collectively referred to
as the "Note register") in which, subject to such reasonable regulations
as it may prescribe, the Company shall provide for the registration of
Notes and of transfers of Notes. Such register shall be in written form
or in any form capable of being converted into written form within a
reasonable period of time. The Trustee is hereby appointed "Note
registrar" for the purpose of registering Notes and transfers of Notes
as herein provided. The Company may appoint one or more co-registrars in
accordance with Section 5.2.
(b) Transfer and Exchange of Global Notes. A Global Note may not
be transferred as a whole except by the Depositary to a nominee of the
Depositary, by a nominee of the Depositary to the Depositary or to
another nominee of the Depositary, or by the Depositary or any such
nominee to a successor Depositary or a nominee of such
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successor Depositary. All Global Notes will be exchanged by the Company
for Definitive Notes if (i) the Company delivers to the Trustee notice
from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under
the Exchange Act and, in either case, a successor Depositary is not
appointed by the Company within 120 days after the date of such notice
from the Depositary or (ii) the Company in its sole discretion
determines that the Global Notes (in whole but not in part) should be
exchanged for Definitive Notes and delivers a written notice to such
effect to the Trustee. Upon the occurrence of either of the preceding
events in (i) or (ii) above, Definitive Notes shall be issued in such
names as the Depositary shall instruct the Trustee. Global Notes also
may be exchanged or replaced, in whole or in part, as provided in
Sections 2.6 and 2.7. Every Note authenticated and delivered in exchange
for, or in lieu of, a Global Note or any portion thereof, pursuant to
this Section 2.5(b) or Section 2.6 or 2.7, shall be authenticated and
delivered in the form of, and shall be, a Global Note. A Global Note may
not be exchanged for another Note other than as provided in this Section
2.5(b), however, beneficial interests in a Global Note may be
transferred and exchanged as provided in Section 2.5(c) or (d).
(c) Transfer and Exchange of Beneficial Interests in the Global
Notes. The transfer and exchange of beneficial interests in the Global
Notes shall be effected through the Depositary, in accordance with the
provisions of this Indenture and the Applicable Procedures. Beneficial
interests in the Restricted Global Notes shall be subject to
restrictions on transfer comparable to those set forth herein to the
extent required by the Securities Act. Transfers of beneficial interests
in the Global Notes also shall require compliance with either
subparagraph (i) or (ii) below, as applicable, as well as one or more of
the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global
Note. Beneficial interests in any Restricted Global Note may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in the same Restricted Global Note in
accordance with the transfer restrictions set forth in the
Private Placement Legend. Beneficial interests in any
Unrestricted Global Note may be transferred to Persons who take
delivery thereof in the form of a beneficial interest in an
Unrestricted Global Note. No written orders or instructions shall
be required to be delivered to the Registrar to effect the
transfers described in this Section 2.5(c)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section
2.5(c)(i) above, the transferor of such beneficial interest must
deliver to the Registrar either (A) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the
Depositary to credit or cause to be credited a beneficial
interest in another Global Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2)
instructions given in accordance with the Applicable Procedures
containing information regarding the Participant account to be
credited with such increase or (B)(1) a written order
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from a Participant or an Indirect Participant given to the
Depositary in accordance with the Applicable Procedures directing
the Depositary to cause to be issued a Definitive Note in an
amount equal to the beneficial interest to be transferred or
exchanged and (2) instructions given by the Depositary to the
Note registrar containing information regarding the Person in
whose name such Definitive Note shall be registered to effect the
transfer or exchange referred to in (1) above. Upon satisfaction
of all of the requirements for transfer or exchange of beneficial
interests in Global Notes contained in this Indenture and the
Notes or otherwise applicable under the Securities Act, the
Trustee shall adjust the principal amount of the relevant Global
Note(s) pursuant to Section 2.5(l).
(iii) Transfer of Beneficial Interests to Another
Restricted Global Note. A beneficial interest in any Restricted
Global Note may be transferred to a Person who takes delivery
thereof in the form of a beneficial interest in another
Restricted Global Note if the transfer complies with the
requirements of Section 2.5(c)(ii) above and the Note registrar
receives the following:
(A) if the transferee will take delivery in the
form of a beneficial interest in the 144A Global Note,
then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications in item
(1) thereof; and
(B) if the transferee will take delivery in the
form of a beneficial interest in the IAI Global Note, then
the transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications and
certificates and Opinion of Counsel required by item (2)
thereof, if applicable.
(iv) Transfer of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in the Unrestricted Global
Note. A beneficial interest in any Restricted Global Note may be
transferred to a Person who takes delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note if the
transfer complies with the requirements of Section 2.5(c)(ii)
above and
(A) such transfer is effected pursuant to a
registration statement filed in accordance with the
Registration Rights Agreement; or
(B) the Note registrar receives the following:
(1) if the Holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for a beneficial
interest in an Unrestricted Global Note, a
certificate from such holder in the form of Exhibit
C hereto, including the certifications in item
(1)(a) thereof; or
(2) if the Holder of such beneficial
interest in a Restricted Global Notes proposes to
transfer such beneficial
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interest to a Person who shall take delivery
thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such
holder in the form of Exhibit B hereto, including
the certifications in item (3) thereof;
and, in each such case set forth in this subparagraph (B),
if the Note registrar so requests or if the Applicable
Procedures so require, an Opinion of Counsel in form
reasonably acceptable to the Note registrar to the effect
that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer
contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with
the Securities Act.
If any such transfer is effected pursuant to subparagraph
(B) above at a time when an Unrestricted Global Note has not yet
been issued, the Company shall issue and, upon receipt of an
Authentication Order in accordance with Section 2.1, the Trustee
shall authenticate one or more Unrestricted Global Notes in an
aggregate principal amount equal to the aggregate principal
amount of beneficial interests transferred pursuant to
subparagraph (B) above.
Beneficial interests in an Unrestricted Global Note cannot
be exchanged for, or transferred to Persons who take delivery
thereof in the form of, a beneficial interest in a Restricted
Global Note.
(d) Transfer or Exchange of Beneficial Interests for Definitive
Notes.
(i) Beneficial Interests in Restricted Global Notes to
Restricted Definitive Notes. If any holder of a beneficial
interest in a Restricted Global Note proposes to exchange such
beneficial interest for a Restricted Definitive Note or to
transfer such beneficial interest to a Person who takes delivery
thereof in the form of a Restricted Definitive Note, then, upon
receipt by the Note registrar of the following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Note proposes to exchange such
beneficial interest for a Restricted Definitive Note, a
certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (2)(a)
thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A under
the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item
(1) thereof;
(C) if such beneficial interest is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144 under the Securities Act, a certificate to the
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effect set forth in Exhibit B hereto, including the
certifications in item (2)(a) thereof;
(D) if such beneficial interest is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration
requirements of the Securities Act other than those listed
in subparagraphs (B) and (C) above, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel
required by item (2) thereof, if applicable;
(E) if such beneficial interest is being transferred
to the Company or any of its Subsidiaries, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (2)(b) thereof; or
(F) if such beneficial interest is being transferred
pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item
(2)(c) thereof;
the Trustee shall cause the aggregate principal amount of the applicable
Global Note to be reduced accordingly pursuant to Section 2.5(l), and
the Company shall execute and the Trustee shall authenticate and deliver
to the Person designated in the instructions a Definitive Note in the
appropriate principal amount. Any Definitive Note issued in exchange for
a beneficial interest in a Restricted Global Note pursuant to this
Section 2.5(d) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Note registrar through
instructions from the Depositary and the Participant or Indirect
Participant. The Trustee shall deliver such Definitive Notes to the
Persons in whose names such Notes are so registered. Any Definitive Note
issued in exchange for a beneficial interest in a Restricted Global Note
pursuant to this Section 2.5(d)(i) shall bear the Private Placement
Legend and shall be subject to all restrictions on transfer contained
therein.
(ii) Beneficial Interests in Restricted Global Notes to
Unrestricted Definitive Notes. A holder of a beneficial interest
in a Restricted Global Note may exchange such beneficial interest
for an Unrestricted Definitive Note or may transfer such
beneficial interest to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Note only if:
(A) such transfer is effected pursuant to a
registration statement filed in accordance with the
Registration Rights Agreement; or
(B) the Note registrar receives the following:
(1) if the Holder of such beneficial interest
in a Restricted Global Notes proposes to exchange
such Notes for a beneficial interest in the
Unrestricted Global Note, a certificate
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from such holder in the form of Exhibit C hereto,
including the certifications in item (1)(c)
thereof; or
(2) if the Holder of such beneficial interest
in a Restricted Global Notes proposes to transfer
such Notes to a Person who shall take delivery
thereof in the form of a beneficial interest in the
Unrestricted Global Note, a certificate from such
holder in the form of Exhibit B hereto, including
the certifications in item (3) thereof;
and, in each such case set forth in this subparagraph (B), if the
Note registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to
the Note registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global Notes to
Unrestricted Definitive Notes. If any holder of a beneficial
interest in an Unrestricted Global Note proposes to exchange such
beneficial interest for a Definitive Note or to transfer such
beneficial interest to a Person who takes delivery thereof in the
form of a Definitive Note, then, upon satisfaction of the
conditions set forth in Section 2.5(c)(ii), the Trustee shall
cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.5(l), and
the Company shall execute and the Trustee shall authenticate and
deliver to the Person designated in the instructions a Definitive
Note in the appropriate principal amount. Any Definitive Note
issued in exchange for a beneficial interest pursuant to this
Section 2.5(d)(iii) shall be registered in such name or names and
in such authorized denomination or denominations as the holder of
such beneficial interest shall instruct the Note registrar
through instructions from the Depositary and the Participant or
Indirect Participant. The Trustee shall deliver such Definitive
Notes to the Persons in whose names such Notes are so registered.
Any Definitive Note issued in exchange for a beneficial interest
pursuant to this Section 2.5(d)(iii) shall not bear the Private
Placement Legend.
(e) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial Interests in
Restricted Global Notes. If any Holder of a Restricted Definitive
Note proposes to exchange such Note for a beneficial interest in
a Restricted Global Note or to transfer such Restricted
Definitive Notes to a Person who takes delivery thereof in the
form of a beneficial interest in a Restricted Global Note, then,
upon receipt by the Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive
Note proposes to exchange such Note for a beneficial
interest in a Restricted Global Note, a
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certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (2)(b)
thereof;
(B) if such Restricted Definitive Note is being
transferred to a QIB in accordance with Rule 144A under
the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item
(1) thereof;
(C) if such Restricted Definitive Note is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144 under the Securities Act, a certificate to the effect
set forth in Exhibit B hereto, including the
certifications in item (2)(a) thereof;
(D) if such Restricted Definitive Note is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration
requirements of the Securities Act other than those listed
in subparagraphs (B) and (C) above, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel
required by item (2) thereof, if applicable;
(E) if such Restricted Definitive Note is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (2)(b) thereof; or
(F) if such Restricted Definitive Note is being
transferred pursuant to an effective registration
statement under the Securities Act, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (2)(c) thereof;
the Trustee shall cancel the Restricted Definitive Note, increase
or cause to be increased the aggregate principal amount of, in
the case of clause (A) above, the appropriate Restricted Global
Note, in the case of clause (B) above, the 144A Global Note, and
in all other cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial Interests
in Unrestricted Global Notes. A Holder of a Restricted Definitive
Note may exchange such Note for a beneficial interest in an
Unrestricted Global Note or transfer such Restricted Definitive
Note to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note only if:
(A) such transfer is effected pursuant to a
registration statement filed in accordance with the
Registration Rights Agreement; or
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(B) the Note registrar receives the following:
(1) if the Holder of such Definitive Notes
proposes to exchange such Notes for a beneficial
interest in the Unrestricted Global Note, a
certificate from such holder in the form of Exhibit
C hereto, including the certifications in item
(1)(c) thereof; or
(2) if the Holder of such Definitive Notes
proposes to transfer such Notes to a Person who
shall take delivery thereof in the form of a
beneficial interest in the Unrestricted Global
Note, a certificate from such holder in the form of
Exhibit B hereto, including the certifications in
item (3) thereof;
and, in each such case set forth in this subparagraph (B), if the
Note registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to
the Note registrar to the effect that such exchange or transfer
is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private
Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
Upon satisfaction of the conditions of any of the subparagraphs
in this Section 2.5(e)(ii), the Trustee shall cancel the
Definitive Notes and increase or cause to be increased the
aggregate principal amount of the Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of an
Unrestricted Definitive Note may exchange such Note for a
beneficial interest in an Unrestricted Global Note or transfer
such Definitive Notes to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note
at any time. Upon receipt of a request for such an exchange or
transfer, the Trustee shall cancel the applicable Unrestricted
Definitive Note and increase or cause to be increased the
aggregate principal amount of one of the Unrestricted Global
Notes.
If any such exchange or transfer from a Definitive Note to
a beneficial interest is effected pursuant to subparagraphs
(ii)(A), (ii)(B) or (iii) above at a time when an Unrestricted
Global Note has not yet been issued, the Company shall issue and,
upon receipt of an Authentication Order in accordance with
Section 2.1, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount equal
to the principal amount of Definitive Notes so transferred.
(f) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's
compliance with the provisions of this Section 2.5(f), the Note
registrar shall register the transfer or exchange of Definitive Notes.
Prior to such registration of transfer or exchange, the requesting
Holder shall present or surrender to the Note registrar the Definitive
Notes duly endorsed
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or accompanied by a written instruction of transfer in form satisfactory
to the Note registrar duly executed by such Holder or by its attorney,
duly authorized in writing. In addition, the requesting Holder shall
provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this
Section 2.5(f).
(i) Restricted Definitive Notes to Restricted Definitive
Notes. Any Restricted Definitive Note may be transferred to and
registered in the name of Persons who take delivery thereof in
the form of a Restricted Definitive Note if the Registrar
receives the following:
(A) if the transfer will be made pursuant to Rule
144A under the Securities Act, then the transferor must
deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (1) thereof; and
(B) if the transfer will be made pursuant to any
other exemption from the registration requirements of the
Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel
required by item (2) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted
Definitive Notes. Any Restricted Definitive Note may be exchanged
by the Holder thereof for an Unrestricted Definitive Note or
transferred to a Person or Persons who take delivery thereof in
the form of an Unrestricted Definitive Note if:
(A) any such transfer is effected pursuant to a
registration statement filed in accordance with the
Registration Rights Agreement; or
(B) the Note registrar receives the following:
(1) if the Holder of such Restricted
Definitive Notes proposes to exchange such Notes
for an Unrestricted Definitive Note, a certificate
from such Holder in the form of Exhibit C hereto,
including the certifications in item (1)(d)
thereof; or
(2) if the Holder of such Restricted
Definitive Notes proposes to transfer such Notes to
a Person who shall take delivery thereof in the
form of an Unrestricted Definitive Note, a
certificate from such Holder in the form of Exhibit
B hereto, including the certifications in item (3)
thereof;
and, in each such case set forth in this subparagraph (B),
if the Note registrar so requests, an Opinion of Counsel
in form reasonably acceptable to the Company to the effect
that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer
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contained herein and in the Private Placement Legend are
no longer required in order to maintain compliance with
the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted
Definitive Notes. A Holder of Unrestricted Definitive Notes may
transfer such Notes to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Note. Upon receipt of a
request to register such a transfer, the Note registrar shall
register the Unrestricted Definitive Notes pursuant to the
instructions from the Holder thereof.
(g) General Provisions Relating to Transfers and Exchanges.
Upon surrender for registration of transfer of any Note to the
Note registrar or any co-registrar, and satisfaction of the requirements
for such transfer set forth in this Section 2.5, the Company shall
execute, and the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Notes of any
authorized denominations and of a like aggregate principal amount and
bearing such restrictive legends as may be required by this Indenture.
No service charge shall be charged to the Noteholder for any
exchange or registration of transfer of Notes, but the Company may
require payment of a sum sufficient to cover any tax, assessments or
other governmental charges that may be imposed in connection therewith.
None of the Company, the Trustee, the Note registrar or any
co-registrar shall be required to exchange or register a transfer of (a)
any Notes for a period of fifteen (15) days next preceding the mailing
of the notice of redemption or (b) any Notes called for redemption or,
if a portion of any Note is selected or called for redemption, such
portion thereof selected or called for redemption or (c) any Notes
surrendered for conversion or, if a portion of any Note is surrendered
for conversion, such portion thereof surrendered for conversion or (d)
any Notes, or a portion of any Note, surrendered for repurchase (and not
withdrawn) in connection with a Repurchase Event.
All Notes issued upon any transfer or exchange of Notes in
accordance with this Indenture shall be the valid obligations of the
Company, evidencing the same debt, and entitled to the same benefits
under this Indenture as the Notes surrendered upon such registration of
transfer or exchange.
Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of
such Note for the purpose of receiving payment of principal of and
interest on such Notes and for all other purposes, and none of the
Trustee, any agent or the Company shall be affected by notice to the
contrary.
The Trustee shall authenticate Global Notes and Definitive Notes
in accordance with the provisions of Section 2.1.
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(h) Legends.
(i) Private Placement Legend on the Notes. Every Note that
bears or is required under this Section 2.5(h)(i) to bear the
legend set forth in this Section 2.5(h)(i) (together with any
Common Stock issued upon conversion of the Notes and required to
bear the legend set forth in Section 2.5(h)(ii), collectively,
the "Restricted Securities") shall be subject to the restrictions
on transfer set forth in this Section 2.5(h)(i) (including the
legend set forth below), unless such restrictions on transfer
shall be waived by written consent of the Company, and the holder
of each such Restricted Security, by such holder's acceptance
thereof, agrees to be bound by all such restrictions on transfer.
As used in Sections 2.5(h)(i) and 2.5(h)(ii), the term "transfer"
encompasses any sale, transfer or other disposition (excluding
any pledge unless or until any foreclosure on such pledge)
whatsoever of any Restricted Security.
Subject to Section 5 of the Securities Purchase Agreement,
until two (2) years after the original issuance date of any Note,
any certificate evidencing such Note (and all securities issued
in exchange therefor or substitution thereof, other than Common
Stock, if any, issued upon conversion thereof which shall bear
the legend set forth in Section 2.5(h)(ii), if applicable) shall
bear a legend in substantially the following form (unless such
Note has been transferred pursuant to a registration statement
that has been declared effective under the Securities Act (and
which continues to be effective at the time of such transfer), or
the Note has been transferred pursuant to the exemption from
registration provided by Rule 144 under the Securities Act, or
unless otherwise agreed by the Company in writing, with notice
thereof to the Trustee):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
FOR THE SECURITIES UNDER THE SECURITIES ACT OR APPLICABLE STATE
SECURITIES LAWS OR AN EXEMPTION THEREFROM. THE SECURITIES MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY THIS SECURITY.
The Company may, but is not obligated to, instruct the
Trustee to place the following legend on any Note held by or
transferred to an "affiliate" (as defined in Rule 501(b) of
Regulation D under the Securities Act):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A
PERSON WHO MAY BE DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR
PURPOSES OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"),
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AND MAY BE SOLD ONLY IN COMPLIANCE WITH RULE 144, PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
PURSUANT TO A VALID EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT. THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH
A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY THE
SECURITIES.
Any Note (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have
expired in accordance with their terms may, upon surrender of
such Note for exchange to the Note registrar in accordance with
the provisions of this Section 2.5, be exchanged for a new Note
or Notes, of like tenor and aggregate principal amount, which
shall not bear the restrictive legend required by this Section
2.5(h)(i).
(ii) Private Placement Legend on Stock Certificate. Until
two (2) years after the original issuance date of any Note, any
stock certificate representing Common Stock issued upon
conversion of such Note shall bear a legend in substantially the
following form (unless such Common Stock has been transferred
pursuant to a registration statement that has been declared
effective under the Securities Act (and which continues to be
effective at the time of such transfer), or the Notes from which
such Common Stock was converted were transferred pursuant to a
registration statement that has been declared effective under the
Securities Act and which was effective at the time of such
transfer, or the Common Stock has been transferred pursuant to an
exemption from registration provided by Rule 144 under the
Securities Act, or unless otherwise agreed by the Company in
writing with written notice thereof to the Trustee and any
transfer agent for the Common Stock):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT") OR APPLICABLE STATE SECURITIES LAWS. THE
SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR
ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
FOR THE SECURITIES UNDER THE SECURITIES ACT OR APPLICABLE STATE
SECURITIES LAWS OR AN EXEMPTION THEREFROM. THE SECURITIES MAY BE
PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER
LOAN SECURED BY THE SECURITIES.
The Company may, but is not obligated to, instruct the
transfer agent for the Company's Common Stock to place the
following legend on any certificate evidencing shares of Common
Stock held by or transferred to an "affiliate" (as defined in
Rule 501(b) of Regulation D under the Securities Act) of the
Company:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A
PERSON WHO MAY BE DEEMED TO BE AN AFFILIATE OF THE
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ISSUER FOR PURPOSES OF RULE 144 PROMULGATED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY BE SOLD
ONLY IN COMPLIANCE WITH RULE 144, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO A
VALID EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT.
Any such Common Stock as to which such restrictions on
transfer shall have expired in accordance with their terms may,
upon surrender of the certificates representing such shares of
Common Stock for exchange in accordance with the procedures of
the transfer agent for the Common Stock, be exchanged for a new
certificate or certificates for a like aggregate number of shares
of Common Stock, which shall not bear the restrictive legend
required by this Section 2.5(h)(ii).
(iii) Global Note Legend. Each Global Note shall bear a
legend in substantially the following form:
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE
TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE
MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO
SECTION 2.6 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.5(b) OF
THE INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE
TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.8 OF THE INDENTURE
AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR
DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
(i) Resale of Notes Purchased by the Company or an Affiliate. Any
Note or Common Stock issued upon the conversion or exchange of a Note
that, prior to the expiration of the holding period applicable to sales
thereof under Rule 144(k) under the Securities Act (or any successor
rule), is purchased or owned by the Company or any Affiliate thereof may
not be resold by the Company or such Affiliate unless registered under
the Securities Act or resold pursuant to an exemption from the
registration requirements of the Securities Act in a transaction that
results in such Notes or Common Stock, as the case may be, no longer
being "restricted securities" (as defined under Rule 144).
(j) Changes in Law. Notwithstanding any provision of Section 2.5
to the contrary, in the event Rule 144(k) as promulgated under the
Securities Act (or any successor rule) is amended to change the two-year
period under Rule 144(k) (or the corresponding period under any
successor rule), from and after receipt by the Trustee of
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the Officer's Certificate and Opinion of Counsel provided for in this
Section 2.5(j), (i) each reference in Section 2.5(h)(i) to "two (2)
years" shall be deemed for all purposes hereof to be references to such
changed period, (ii) each reference in Section 2.5(h)(ii) to "two (2)
years" shall be deemed for all purposes hereof to be references to such
changed period and (iii) all corresponding references in the Notes shall
be deemed for all purposes hereof to be references to such changed
period, provided that such changes shall not become effective if they
are otherwise prohibited by, or would otherwise cause a violation of,
the then-applicable federal securities laws. As soon as practicable
after the Company has knowledge of the effectiveness of any such
amendment to change the two-year period under Rule 144(k) (or the
corresponding period under any successor rule), unless such changes
would otherwise be prohibited by, or would otherwise cause a violation
of, the then-applicable securities law, the Company shall provide to the
Trustee an Officer's Certificate and Opinion of Counsel informing the
Trustee of the effectiveness of such amendment and the effectiveness of
the foregoing changes to Sections 2.5(h)(i) and 2.5(h)(ii) and the
Notes. The provisions of this Section 2.5(j) will not be effective until
such time as the Opinion of Counsel and Officer's Certificate have been
received by the Trustee hereunder. This Section 2.5(j) shall apply to
successive amendments to Rule 144(k) (or any successor rule) changing
the holding period thereunder.
(k) Limitation on Trustee's Duties. The Trustee shall have no
obligation or duty to monitor, determine or inquire as to compliance
with any restrictions on transfer imposed under this Indenture or under
applicable law with respect to any transfer of any interest in any Note
other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if
and when expressly required by the terms of, this Indenture, and to
examine the same to determine substantial compliance as to form with the
express requirements hereof.
(l) Cancellation and/or Adjustment of Global Notes. At such time
as all beneficial interests in a particular Global Note have been
exchanged for Definitive Notes or a particular Global Note has been
redeemed, repurchased or canceled in whole and not in part, each such
Global Note shall be returned to or retained and canceled by the Trustee
in accordance with Section 2.8. At any time prior to such cancellation,
if any beneficial interest in a Global Note is exchanged for or
transferred to a Person who will take delivery thereof in the form of a
beneficial interest in another Global Note or for Definitive Notes, the
principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall be made on such Global Note
by the Trustee or by the Depositary at the direction of the Trustee to
reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note, such other
Global Note shall be increased accordingly and an endorsement shall be
made on such Global Note by the Trustee or by the Depositary at the
direction of the Trustee to reflect such increase.
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Section 2.6 Mutilated, Destroyed, Lost or Stolen Notes
In case any Note shall become mutilated or be destroyed, lost or stolen,
the Company in its discretion may execute, and upon its request the Trustee or
an authenticating agent appointed by the Trustee shall authenticate and deliver,
a new Note, bearing a number not contemporaneously outstanding, in exchange and
substitution for the mutilated Note, or in lieu of and in substitution for the
Note so destroyed, lost or stolen. In every case the applicant for a substituted
Note shall furnish to the Company, to the Trustee and, if applicable, to such
authenticating agent such security or indemnity as required by them to save each
of them harmless for any loss, liability, cost or expense caused by or connected
with such substitution, and, in every case of destruction, loss or theft, the
applicant shall also furnish to the Company, to the Trustee and, if applicable,
to such authenticating agent evidence to their reasonable satisfaction of the
destruction, loss or theft of such Note and of the ownership thereof.
The Trustee or such authenticating agent may authenticate any such
substituted Note and deliver the same upon the receipt of such security or
indemnity as the Trustee, the Company and, if applicable, such authenticating
agent may reasonably require. Upon the issuance of any substituted Note, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses connected therewith. Once any substitute Note has been issued pursuant
to this Section 2.6, the original Note being replaced by such substitute Note
shall automatically be deemed cancelled. In case any Note which has matured or
is about to mature or has been called for redemption or is about to be converted
into Common Stock shall become mutilated or be destroyed, lost or stolen, the
Company may, instead of issuing a substitute Note, pay or authorize the payment
of or convert or authorize the conversion of the same (without surrender thereof
except in the case of a mutilated Note), as the case may be, if the applicant
for such payment or conversion shall furnish to the Company, to the Trustee and,
if applicable, to such authenticating agent such security or indemnity as will
be required by them to save each of them harmless for any loss, liability, cost
or expense caused by or connected with such substitution, and, in case of
destruction, loss or theft, evidence reasonably satisfactory to the Company, the
Trustee and, if applicable, any paying agent or conversion agent of the
destruction, loss or theft of such Note and of the ownership thereof.
Every substitute Note issued pursuant to the provisions of this Section
2.6 by virtue of the fact that any Note is destroyed, lost or stolen shall
constitute an additional contractual obligation of the Company, whether or not
the destroyed, lost or stolen Note shall be found at any time, and shall be
entitled to all the benefits of (but shall be subject to all the limitations set
forth in) this Indenture equally and proportionately with any and all other
Notes duly issued hereunder. To the extent permitted by law, all Notes shall be
held and owned upon the express condition that the foregoing provisions are
exclusive with respect to the replacement or payment or conversion of mutilated,
destroyed, lost or stolen Notes and shall preclude any and all other rights or
remedies notwithstanding any law or statute existing or hereafter enacted to the
contrary with respect to the replacement or payment or conversion of negotiable
instruments or other securities without their surrender.
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Section 2.7 Temporary Notes
Pending the preparation of definitive Notes, the Company may execute and
the Trustee or an authenticating agent appointed by the Trustee shall, upon
written request of the Company, authenticate and deliver temporary Notes
(printed or lithographed). Temporary Notes shall be issuable in any authorized
denomination, and substantially in the form of the Global Notes or the
Definitive Notes, as the case may be, but with such omissions, insertions and
variations as may be appropriate for temporary Notes, all as may be determined
by the Company. Every such temporary Note shall be executed by the Company and
authenticated by the Trustee or such authenticating agent upon the same
conditions and in substantially the same manner, and with the same effect, as
the Definitive Notes or Global Notes. Without unreasonable delay the Company
will execute and deliver to the Trustee or such authenticating agent Definitive
Notes and Global Notes and thereupon any or all temporary Notes may be
surrendered in exchange for the applicable replacement Note, at each office or
agency maintained by the Company pursuant to Section 5.2 and the Trustee or such
authenticating agent shall authenticate and deliver in exchange for such
temporary Notes an equal aggregate principal amount of Definitive Notes or
Global Notes, as the case may be. Such exchange shall be made by the Company at
its own expense and without any charge therefor. Until so exchanged, the
temporary Notes shall in all respects be entitled to the same benefits and
subject to the same limitations under this Indenture as Definitive Notes or
Global Notes, as the case may be, authenticated and delivered hereunder.
Section 2.8 Cancellation of Notes Paid, Etc.
All Notes surrendered for the purpose of payment, redemption,
repurchase, conversion, exchange or registration of transfer, shall, if
surrendered to the Company or any paying agent or any Note registrar or any
conversion agent, be surrendered to the Trustee and promptly canceled by it, or,
if surrendered to the Trustee, shall be promptly canceled by it, and no Notes
shall be issued in lieu thereof except as expressly permitted by any of the
provisions of this Indenture. Upon written instructions of the Company, the
Trustee shall dispose of canceled Notes in accordance with its customary
procedures. If the Company shall acquire any of the Notes, such acquisition
shall not operate as a redemption or satisfaction of the indebtedness
represented by such Notes unless and until the same are delivered to the Trustee
for cancellation.
Section 2.9 CUSIP Numbers
The Company in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided 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 will promptly notify the Trustee of any
change in the "CUSIP" numbers.
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ARTICLE III
OPTIONAL REDEMPTION OF NOTES
Section 3.1 Redemption Price
From and after June 21, 2005, the Company may, at its option, redeem all
or any part of the Notes, upon notice as set forth in Section 3.2, and the
Company shall pay each holder of Notes redeemed the appropriate redemption price
(expressed as percentages of principal amount) set forth below, plus accrued and
unpaid interest thereon, if any, to, but not including, the date of redemption,
if redeemed during the 12-month period beginning on June 21 of the years
indicated below:
YEAR REDEMPTION PRICE
---- ----------------
2005 102.10%
2006 101.05%
2007 100%
Section 3.2 Notice of Redemption; Selection of Notes
In case the Company shall desire to exercise the right to redeem all or,
as the case may be, any part of the Notes pursuant to Section 3.1, it shall fix
a date for redemption, and it, or at its request (which must be received by the
Trustee at least ten (10) Business Days prior to the date the Trustee is
requested to give notice as described below unless a shorter period is agreed to
by the Trustee), the Trustee in the name of and at the expense of the Company,
shall mail or cause to be mailed a notice of such redemption at least thirty
(30) and not more than ninety (90) days prior to the date fixed for redemption
to the holders of Notes so to be redeemed as a whole or in part at their last
addresses as the same appear on the Note register (provided that if the Company
shall give such notice, it shall also give such notice, and notice of the
aggregate amount of Notes to be redeemed, to the Trustee). Such mailing shall be
by first class mail. The notice if mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the holder
receives such notice. In any case, failure to give such notice by mail or any
defect in the notice to the holder of any Note designated for redemption as a
whole or in part shall not affect the validity of the proceedings for the
redemption of any other Note.
Each such notice of redemption shall specify the aggregate principal
amount of Notes to be redeemed, the "CUSIP" number or numbers of such Notes, if
any, the date fixed for redemption, the redemption price at which Notes are to
be redeemed, the place or places of payment, that payment will be made upon
presentation and surrender of such Notes, that interest accrued to, but
excluding, the date fixed for redemption will be paid as specified in said
notice, and that on and after said date interest thereon or on the portion
thereof to be redeemed will cease to accrue. Such notice shall also state the
current Conversion Price and the date on which the right to convert such Notes
or portions thereof into Common Stock will expire. If fewer than all the Notes
are to be redeemed, the notice of redemption shall identify the Notes to be
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redeemed. In case any Note is to be redeemed in part only, the notice of
redemption shall state the portion of the principal amount thereof to be
redeemed and shall state that on and after the date fixed for redemption, upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion thereof will be issued.
On or prior to the redemption date specified in the notice of redemption
given as provided in this Section, the Company will deposit with the Trustee or
with one or more paying agents (or, if the Company is acting as its own paying
agent, set aside, segregate and hold in trust as provided in Section 5.4) an
amount of money sufficient to redeem on the redemption date all the Notes (or
portions thereof) so called for redemption (other than those theretofore
surrendered for conversion into Common Stock) at the appropriate redemption
price, together with accrued interest to, but excluding, the date fixed for
redemption; provided that if such payment is made on the redemption date it must
be received by the Trustee or paying agent, as the case may be, by 10:00 a.m.
New York City time, on such date. If any Note called for redemption is converted
pursuant hereto, any money deposited with the Trustee or any paying agent or so
segregated and held in trust for the redemption of such Note shall be paid to
the Company upon its request, or, if then held by the Company shall be
discharged from such trust.
If fewer than all the Notes are to be redeemed, the Company will give
the Trustee written notice in the form of an Officer's Certificate not fewer
than forty-five (45) days (or such shorter period of time as may be acceptable
to the Trustee) prior to the redemption date as to the aggregate principal
amount of Notes to be redeemed. If fewer than all the Notes are to be redeemed,
the Trustee shall select the Notes or portions thereof to be redeemed (in
principal amounts of $1,000 or integral multiples thereof), on a pro rata basis.
If any Note selected for partial redemption is converted in part after such
selection, the converted portion of such Note shall be deemed (so far as is
possible) to be the portion to be selected for redemption. The Notes (or
portions thereof) so selected shall be deemed duly selected for redemption for
all purposes hereof, notwithstanding that any such Note is converted as a whole
or in part before the mailing of the notice of redemption.
Upon any redemption of less than all Notes, the Company and the Trustee
may (but need not) treat as outstanding any Notes surrendered for conversion
during the period of fifteen (15) days next preceding the mailing of a notice of
redemption and may (but need not) treat as not outstanding any Note
authenticated and delivered during such period in exchange for the unconverted
portion of any Note converted in part during such period.
Section 3.3 Payment of Notes Called for Redemption
If notice of redemption has been given as above provided, the Notes or
portion of Notes with respect to which such notice has been given shall, unless
converted into Common Stock pursuant to the terms hereof, become due and payable
on the date and at the place or places stated in such notice at the applicable
redemption price, and interest accrued to, but excluding, the date fixed for
redemption, and on and after said date (unless the Company shall default in the
payment of such Notes at the redemption price and interest accrued to, but
excluding, said date) interest on the Notes or portion of Notes so called for
redemption shall cease to accrue and such Notes shall cease after the close of
business on the Business Day next preceding the date fixed
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for redemption to be convertible into Common Stock and, except as provided in
Sections 8.5 and 13.4, to be entitled to any benefit or security under this
Indenture, and the holders thereof shall have no right in respect of such Notes
except the right to receive the redemption price thereof and unpaid interest to,
but excluding, the date fixed for redemption. On presentation and surrender of
such Notes at a place of payment specified in said notice, the said Notes or the
specified portions thereof to be redeemed shall be paid and redeemed by the
Company at the applicable redemption price and interest accrued thereon to, but
excluding, the date fixed for redemption; provided that, if the applicable
redemption date is an interest payment date, the semi-annual payment of interest
becoming due on such date shall be payable to the holders of such Notes
registered as such on the relevant record date subject to the terms and
provisions of Section 2.3.
Upon presentation of any Note redeemed in part only, the Company shall
execute and the Trustee shall authenticate and deliver to the holder thereof, at
the expense of the Company, a new Note or Notes, of authorized denominations, in
principal amount equal to the unredeemed portion of the Notes so presented.
Notwithstanding the foregoing, the Trustee shall not redeem any Notes or
mail any notice of optional redemption during the continuance of a default in
payment of interest or premium on the Notes or of any Event of Default of which,
in the case of any Event of Default other than under Section 7.1(a), (b) or (d),
a Responsible Officer of the Trustee has actual knowledge. If any Note called
for redemption shall not be so paid upon surrender thereof for redemption, the
principal and premium, if any, shall, until paid or duly provided for, bear
interest from the date fixed for redemption at the rate borne by the Note and
such Note shall remain convertible into Common Stock until the principal and
premium, if any, shall have been paid or duly provided for.
Section 3.4 Conversion Arrangement on Call for Redemption
In connection with any redemption of Notes, the Company may arrange for
the purchase and conversion of any Notes not converted prior to the expiration
of such conversion right by an agreement with one or more investment bankers or
other purchasers to purchase such Notes by paying to the Trustee in trust for
the Noteholders, on or before the date fixed for redemption, an amount not less
than the applicable redemption price and interest accrued to the date fixed for
redemption, of such Notes. Notwithstanding anything to the contrary contained in
this Article III, the obligation of the Company to pay the redemption price of
such Notes and interest accrued to, but excluding, the date fixed for
redemption, shall be deemed to be satisfied and discharged to the extent such
amount is so paid by such purchasers to such Noteholders. If such an agreement
is entered into, a copy of which, certified as true and correct by the Secretary
or Assistant Secretary of the Company will be filed with the Trustee prior to
the date fixed for redemption, any Notes not duly surrendered for conversion by
the holders thereof may, at the option of the Company, be deemed, to the fullest
extent permitted by law, acquired by such purchasers from such holders and
(notwithstanding anything to the contrary contained in Article XV) surrendered
by such purchasers for conversion, all as of immediately prior to the close of
business on the date fixed for redemption (and the right to convert any such
Notes shall be deemed to have been extended through such time), subject to
payment of the above amount as
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aforesaid. At the written direction of the Company, the Trustee shall hold and
dispose of any such amount paid to it in the same manner as it would monies
deposited with it by the Company for the redemption of Notes. Without the
Trustee's prior written consent, no arrangement between the Company and such
purchasers for the purchase and conversion of any Notes shall increase or
otherwise affect any of the powers, duties, responsibilities or obligations of
the Trustee as set forth in this Indenture, and the Company agrees to indemnify
the Trustee from, and hold it harmless against, any loss, liability or expense
arising out of or in connection with any such arrangement for the purchase and
conversion of any Notes between the Company and such purchasers, including the
costs and expenses incurred by the Trustee in the defense of any claim or
liability arising out of or in connection with the exercise or performance of
any of its powers, duties, responsibilities or obligations under this Indenture.
ARTICLE IV
SUBORDINATION
Section 4.1 Subordination to Senior Indebtedness
The Company covenants and agrees, and each holder of a Note, by his or
her acceptance thereof, likewise covenants and agrees, that all Notes shall be
issued subject to the provisions of this Article IV and to the extent and in the
manner hereinafter set forth in this Article IV, the indebtedness represented by
the Notes and the payment of the principal amount, Conversion Price, and
interest thereon, liquidated damages or any other amounts in respect of each and
all of the Notes are hereby expressly made subordinate and junior and subject in
right of payment to the prior payment in full of all Senior Indebtedness of the
Company now outstanding or hereinafter incurred. "Senior Indebtedness" means the
principal of, and premium, if any, and interest on, fees, costs and expenses in
connection with and other amounts due on (i) all indebtedness of the Company for
monies borrowed, including, without limitation, commercial paper and accounts
receivable sold or assigned by the Company, (ii) all obligations of the Company
evidenced by any notes, debentures, bonds or other instruments issued to banks,
trust companies, insurance companies, other financial institutions and other
entities that in the ordinary course of business make loans, (iii) all
obligations of the Company under any interest or currency swap agreements,
hedging agreements, cap, floor and collar agreements, spot and forward contracts
and other similar agreements, (iv) obligations in respect of letters of credit,
bank guarantees and bankers acceptances, (v) obligations of the Company as
lessee under leases of personal property (whether or not required to be
capitalized under GAAP), (vi) obligations secured by a mortgage, pledge,
security interest, lien or encumbrance affecting title to any of the Company's
assets, whether or not the Company is directly liable or has guaranteed such
obligations, (vii) obligations consisting of the balance of the deferred or
unpaid purchase price of assets, (viii) principal of, and interest on any
indebtedness or obligations of others of the kinds described in (i) through
(viii) above assumed or guaranteed in any manner by the Company, and (ix)
deferrals, renewals, extensions and refundings of any such indebtedness or
obligations described in (i) through (viii) above, in each case unless the
instrument creating or evidencing the same or pursuant to which the same is
outstanding expressly provides that the same is not senior in right of payment
to the Notes. Senior Indebtedness includes, with respect to the
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foregoing, interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company, whether or not
post-filing interest is allowed in such proceeding. Notwithstanding the
foregoing, "Senior Indebtedness" with respect to any Note shall not include (a)
indebtedness of the Company evidenced by the other Notes, which shall rank
equally and ratably with such Note, (b) any obligation of the Company to any
Subsidiary or Affiliate of the Company, (c) any liability for Federal, state,
local or other taxes owed or owing by the Company, (d) any accounts payable or
other liability to trade creditors arising in the ordinary course of business
(including guarantees thereof or instruments evidencing such liabilities), (e)
any indebtedness or obligation of the Company (and any accrued and unpaid
interest in respect thereof) that by its terms is subordinate or junior in right
of payment to any other indebtedness or obligation of the Company, or (f) any
obligation with respect to any shares, interest, rights to purchase, warrants,
options, participations or other equivalents of, or interests in, the equity of
the Company or any Subsidiary or Affiliate, including any preferred stock or
other preferred equity.
Section 4.2 No Payment if Default in Senior Indebtedness
No payment on account of principal of or interest on the Notes shall be
made, and no Notes shall be redeemed or purchased directly or indirectly by the
Company (or any of its Subsidiaries), if at the time of such payment or purchase
or immediately after giving effect thereto, (i) a default in the payment of
principal, premium, if any, interest, rent or other obligations in respect of
any Senior Indebtedness occurs and is continuing (or, in the case of Senior
Indebtedness for which there is a period of grace, in the event of such a
default that continues beyond the period of grace, if any, specified in the
instrument or lease evidencing such Senior Indebtedness) (a "Payment Default"),
unless and until such Payment Default shall have been cured or waived or shall
have ceased to exist or (ii) the Company shall have received notice (a "Payment
Blockage Notice") from the holder or holders of Designated Senior Debt that
there exists under such Designated Senior Debt a default, which shall not have
been cured or waived, permitting the holder or holders thereof to declare such
Designated Senior Debt due and payable, but only for the period (the "Payment
Blockage Period") commencing on the date of receipt of the Payment Blockage
Notice and ending on the earlier of (a) the date such default shall have been
cured or waived, or (b) the 180th day immediately following the Company's
receipt of such Payment Blockage Notice. The Company shall resume payments on
and distributions in respect of the Notes, including any past scheduled payments
of the principal of (and premium, if any) and interest on such Notes to which
the Holders of the Notes would have been entitled but for the provisions of this
Section 4.2 in the case of a Payment Default, on the date upon which such
Payment Default is cured or waived or ceases to exist. In addition,
notwithstanding clauses (i) and (ii), unless the holders of Designated Senior
Debt shall have accelerated the maturity of such Designated Senior Debt, the
Company shall resume payments on the Note after the end of each Payment Blockage
Period. Not more than one Payment Blockage Notice may be given in any
consecutive 360-day period, irrespective of the number of defaults with respect
to Designated Senior Debt during such period.
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Section 4.3 Payment upon Dissolution, Etc.
(a) In the event of any bankruptcy, insolvency, reorganization,
receivership, composition, assignment for benefit of creditors or other
similar proceeding initiated by or against the Company or any
dissolution or winding up or total or partial liquidation or
reorganization of the Company (being hereinafter referred to as a
"Proceeding"), each holder of a Note, by his or her acceptance thereof,
agrees that such holder shall, upon request of a holder of Senior
Indebtedness, and at such holder's own expense take all reasonable
actions (including but not limited to the execution and filing of
documents and the giving of testimony in any Proceeding, whether or not
such testimony could have been compelled by process) necessary to prove
the full amount of all their claims in any Proceeding, and the
Noteholders shall not waive any claim in any Proceeding without the
written consent of such Holder.
(b) Upon payment or distribution to creditors in a Proceeding of
assets of the Company of any kind or character, whether in cash,
property or securities, all principal and interest due upon any Senior
Indebtedness shall first be paid in full before any Holders of the Notes
shall be entitled to receive or, if received, to retain any payment or
distribution on account of the Notes, and upon any such Proceeding, any
payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to which any Holders
of the Notes would be entitled except for the provisions of this Article
IV shall be paid by the Company or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making such
payment or distribution, or by any holders of the Notes who shall have
received such payment or distribution, directly to the holders of the
Senior Indebtedness (pro rata to each such holder on the basis of the
respective amounts of such Senior Indebtedness held by such holder) or
their representatives to the extent necessary to pay all such Senior
Indebtedness in full after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Indebtedness, before
any payment or distribution is made to any holders of the Notes.
Section 4.4 Payments on Notes
Subject to Section 4.3, the Company may make payments of the principal
of, and any interest or premium on, the Notes, if at the time of payment, and
immediately after giving effect thereto, (i) there exists no Payment Default or
a Payment Blockage Period and (ii) the Company is permitted to make payments
under Section 4.3.
Section 4.5 Certain Conversions Deemed Payment
For the purposes of this Article IV only (a) the issuance and delivery
of junior securities upon conversion of Notes in accordance with Article XV
shall not be deemed to constitute a payment of distribution on account of the
principal of or interest on Notes or on account of the purchase or other
acquisition of Notes, and (b) the payment, issuance or delivery of cash (except
in satisfaction of fractional shares pursuant to Section 15.3), property or
securities (other than
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junior securities) upon conversion of a Note shall be deemed to constitute
payment on account of the principal of such Note. For the purposes of this
Section 4.5, the term "junior securities" means (i) shares of any stock of any
class of the Company, or (ii) securities of the Company which are subordinated
in right of payment to all Senior Indebtedness which may be outstanding at the
time of issuance or delivery of such securities to substantially the same extent
as, or to a greater extent than, the Notes are so subordinated as provided in
this Article IV. Nothing contained in this Article IV or elsewhere in this
Indenture or in the Notes is intended to or shall impair, as among the Company,
its creditors other than holders of Senior Indebtedness and the holders, the
right, which is absolute and unconditional, of the holder of any Note to convert
such Note in accordance with Article IV.
Section 4.6 Subrogation
Subject to payment in full of all Senior Indebtedness, the holders of
the Notes shall be subrogated to the rights of the holders of Senior
Indebtedness to receive payments or distributions of the assets of the Company
made on such Senior Indebtedness until all principal and interest on the Notes
shall be paid in full; and for purposes of such subrogation, no payments or
distributions to the holders of Senior Indebtedness of any cash, property or
securities to which any holders of the Notes would be entitled except for the
subordination provisions of this Article IV shall, as between the holders of the
Notes and the Company and/or its creditors other than the holders of the Senior
Indebtedness, be deemed to be a payment on account of the Senior Indebtedness.
Section 4.7 Rights of Holders Unimpaired
The provisions of this Article IV are and are intended solely for the
purposes of defining the relative rights of the holders of the Notes and the
holders of Senior Indebtedness and nothing in this Article IV shall impair, as
between the Company and any holders of the Notes, the obligation of the Company,
which is unconditional and absolute, to pay to the holders of the Notes the
principal thereof (and premium, if any) and interest thereon, in accordance with
the terms of the Notes.
Section 4.8 Holders of Senior Indebtedness
These provisions regarding subordination will constitute a continuing
offer to all Persons who, in reliance upon such provisions, become holders of,
or continue to hold, Senior Indebtedness; such provisions are made for the
benefit of the holders of Senior Indebtedness, and such holders are hereby made
obligees under such provisions to the same extent as if they were named therein,
and they or any of them may proceed to enforce such subordination. The holders
of Senior Indebtedness may, at any time and from time to time, without the
consent of or notice to any of the Noteholders, without incurring responsibility
to the Noteholders and without impairing or releasing the subordination
provisions of this Article IV, (i) change the manner, terms or place of payment
of, or renew or alter, any Senior Indebtedness, or otherwise amend or supplement
the same, (ii) sell, exchange or release any collateral mortgaged, pledged or
otherwise securing the Senior Indebtedness, (iii) release any Person liable in
any manner for the
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Senior Indebtedness and (iv) exercise or refrain from exercising any rights
against the Company or any other Person.
Section 4.9 Trustee Not Fiduciary for Holders of Senior Indebtedness
The Trustee shall not be deemed to owe any fiduciary duty to the holders
of Senior Indebtedness and shall not be liable to any such holders if the
Trustee shall in good faith mistakenly pay over or distribute to Holders of
Notes or to the Company or to any other person cash, property or securities to
which any holders of Senior Indebtedness shall be entitled by virtue of this
Article IV or otherwise. With respect to the holders of Senior Indebtedness, no
implied covenants or obligations with respect to holders of Senior Indebtedness
shall be read into this Indenture against the Trustee.
Section 4.10 Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article IV with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 8.6.
ARTICLE V
PARTICULAR COVENANTS OF THE COMPANY
Section 5.1 Payment of Principal, Premium and Interest
The Company covenants and agrees that it will duly and punctually pay or
cause to be paid the principal of and premium, if any, and interest on each of
the Notes at the places, at the respective times and in the manner provided
herein and in the Notes. Liquidated Damages paid pursuant to Section 15.2, if
any, shall be paid within ten (10) Business Days of the date from which such
liquidated damages accrued pursuant to Section 15.2. Liquidated Damages on the
Notes paid pursuant to Section 2(f) of the Registration Rights Agreement, if
any, shall be paid at the times and in the manner provided therein. Each
installment of interest on the Notes due on any semi-annual interest payment
date may be paid by mailing checks for the interest payable to or upon the
written order of the holders of Notes entitled thereto as they shall appear on
the Note register, provided that, with respect to any holder of Notes with an
aggregate principal amount equal to or in excess of $500,000, at the request of
such holder in writing to the Company, interest on such holder's Notes shall be
paid by wire transfer in immediately available funds in accordance with the wire
transfer instructions supplied by such holder from time to time to the Trustee
and paying agent (if different from Trustee) at least two (2) Business Days
prior to the applicable record date.
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Section 5.2 Maintenance of Office or Agency
The Company will maintain in the Borough of Manhattan, The City of New
York, an office or agency where the Notes may be presented for registration of
transfer or exchange or for presentation for payment or for conversion,
redemption or repurchase and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company will give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency not designated or appointed by the Trustee.
If at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office or the office or agency of the Trustee in the Borough of
Manhattan, The City of New York.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York, for such purposes. The Company will give prompt written
notice to the Trustee of any such designation or rescission and of any change in
the location of any such other office or agency.
The Company hereby initially designates the Trustee as paying agent,
Note registrar, Custodian and conversion agent and the Corporate Trust Office
and the office or agency of the Trustee in the Borough of Manhattan, The City of
New York (which initially shall be The Bank of New York, located at 000 Xxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust Administration), as
one such office or agency of the Company for each of the aforesaid purposes.
So long as the Trustee is the Note registrar, the Trustee agrees to
mail, or cause to be mailed, the notices set forth in Section 8.10(a) and the
third paragraph of Section 8.11.
Section 5.3 Appointments to Fill Vacancies in Trustee's Office
The Company, whenever necessary to avoid or fill a vacancy in the office
of Trustee, will appoint, in the manner provided in Section 8.10, a Trustee, so
that there shall at all times be a Trustee hereunder.
Section 5.4 Provisions as to Paying Agent
(a) If the Company shall appoint a paying agent other than the
Trustee or if the Trustee shall appoint such a paying agent, it will
cause such paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee, subject to
the provisions of this Section 5.4:
(1) that it will hold all sums held by it as such agent
for the payment of the principal of and premium, if any, or
interest (including Liquidated Damages, if any) on the Notes
(whether such sums have been paid to it by the Company or by any
other Person) in trust for the benefit of the holders of the
Notes;
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(2) that it will give the Trustee notice of any failure by
the Company (or by any other Person) to make any payment of the
principal of and premium, if any, or interest (including
Liquidated Damages, if any) on the Notes when the same shall be
due and payable; and
(3) that at any time during the continuance of an Event of
Default, upon request of the Trustee, it will forthwith pay to
the Trustee all sums so held in trust.
The Company shall, on or before each due date of the principal
of, premium, if any, or interest on the Notes, deposit with the paying
agent a sum sufficient to pay such principal, premium, if any, or
interest, and (unless such paying agent is the Trustee) the Company will
promptly notify the Trustee of any failure to take such action, provided
that if such deposit is made on the due date, such deposit must be
received by the paying agent by 10:00 a.m., New York City time, on such
date.
(b) If the Company shall act as its own paying agent, it will, on
or before each due date of the principal of, premium, if any, or
interest (including Liquidated Damages, if any) on the Notes, set aside,
segregate and hold in trust for the benefit of the holders of the Notes
a sum sufficient to pay such principal, premium, if any, or interest
(including Liquidated Damages, if any) so becoming due and will notify
the Trustee of any failure to take such action and of any failure by the
Company (or any other Person) to make any payment of the principal of,
premium, if any, or interest (including Liquidated Damages, if any) on
the Notes when the same shall become due and payable.
(c) Anything in this Section 5.4 to the contrary notwithstanding,
the Company may, at any time, for the purpose of obtaining a
satisfaction and discharge of this Indenture, or for any other reason,
pay or cause to be paid to the Trustee all sums held in trust by the
Company or any paying agent hereunder as required by this Section 5.4,
such sums to be held by the Trustee upon the trusts herein contained and
upon such payment by the Company or any paying agent to the Trustee, the
Company or such paying agent shall be released from all further
liability with respect to such sums.
(d) Anything in this Section 5.4 to the contrary notwithstanding,
the agreement to hold sums in trust as provided in this Section 5.4 is
subject to Sections 13.3 and 13.4.
Section 5.5 Existence
Subject to Article XII, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence.
Section 5.6 Information Requirement
Within the period prior to the expiration of the holding period
applicable to sales thereof under Rule 144(k) under the Securities Act (or any
successor provision), the Company covenants and agrees that it shall, during any
period in which it is not subject to Section 13 or 15(d) under
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the Exchange Act, make available to any holder or beneficial holder of Notes or
any Common Stock issued upon conversion thereof, in each case which continue to
be Restricted Securities, in connection with any sale thereof and any
prospective purchaser of Notes or such Common Stock from such holder or
beneficial holder, the information required pursuant to Rule 144A(d)(4) under
the Securities Act upon the request of any holder or beneficial holder of the
Notes or such Common Stock and it will take such further action as any holder or
beneficial holder of such Notes or such Common Stock may reasonably request in
connection with qualification of such sale for exemption from registration under
Rule 144A.
Section 5.7 Stay, Extension and Usury Laws
The Company covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law or other law
that would prohibit or forgive the Company from paying all or any portion of the
principal of or interest on the Notes as contemplated herein, wherever enacted,
now or at any time hereafter in force, or which may affect the covenants or the
performance of this Indenture; and the Company (to the extent it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not, by resort to any such law, hinder, delay or impede
the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law has been enacted.
Section 5.8 Compliance Certificate
The Company shall deliver to the Trustee within one hundred twenty (120)
days after the end of each fiscal year of the Company (beginning with the fiscal
year ending on December 31, 2002) an Officer's Certificate, signed by the
principal executive, principal financial officer or accounting officer of the
Company, stating whether or not to the best of such person's knowledge the
signers know of any default or Event of Default that occurred during such
period. Such Officer's Certificate shall describe in reasonable detail the
default or Event of Default, if any, and its status.
The Company shall deliver to the Trustee, as soon as possible and in any
event within three (3) Business Days after the Company becomes aware of the
occurrence of any Event of Default or an event which, with notice or the lapse
of time or both, would constitute an Event of Default, an Officer's Certificate
setting forth the details of such Event of Default or default and the action
which the Company proposes to take with respect thereto.
Section 5.9 Further Instruments and Acts
Upon request of the Trustee, the Company will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purposes of this Indenture.
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ARTICLE VI
NOTEHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
Section 6.1 Noteholders Lists
The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee, semi-annually, not more than fifteen (15) days after
each June 1 and December 1 in each year beginning with December 1, 2002 and at
such other times as the Trustee may request in writing, within thirty (30) days
after receipt by the Company of any such request (or such lesser time as the
Trustee may reasonably request in order to enable it to timely provide any
notice to be provided by it hereunder), a list in such form as the Trustee may
reasonably require of the names and addresses of the holders of Notes as of a
date not more than fifteen (15) days (or such other date as the Trustee may
reasonably request in order to so provide any such notices) prior to the time
such information is furnished, except that no such list need be furnished so
long as the Trustee is acting as Note registrar.
Section 6.2 Preservation and Disclosure of Lists
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, all information as to the names and addresses of the
holders of Notes contained in the most recent list furnished to it as provided
in Section 6.1 or maintained by the Trustee in its capacity as Note registrar,
if so acting. The Trustee may destroy any list furnished to it as provided in
Section 6.1 upon receipt of a new list so furnished.
(b) The rights of Noteholders to communicate with other holders of
Notes with respect to their rights under this Indenture or under the Notes and
the corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Noteholder, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of holders of Notes made pursuant to the
Trust Indenture Act.
Section 6.3 Reports by Trustee
(a) After this Indenture has been qualified under the Trust
Indenture Act, the Trustee shall transmit to holders of Notes such reports
concerning the Trustee and its actions under this Indenture as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant thereto. If required by Section 313(a) of the Trust Indenture Act, the
Trustee shall, within sixty (60) days after each May 15 following the date of
this Indenture deliver to holders a brief report, dated as of such May 15 which
complies with the provisions of such Section 313(a).
(b) A copy of such report shall, at the time of such transmission to
holders of Notes, be filed by the Trustee with each stock exchange and automated
quotation system upon which the Notes are listed, if any, and with the Company.
The Company will promptly notify
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the Trustee as soon as practicable when the Notes are listed on any stock
exchange or automated quotation system and when any such listing is
discontinued.
Section 6.4 Reports by Company
(a) After this Indenture has been qualified under the Trust
Indenture Act, the Company shall file with the Trustee and the Commission, and
transmit to holders of Notes, such information, documents and other reports and
such summaries thereof, as may be required pursuant to the Trust Indenture Act
at the times and in the manner provided pursuant to such Act; provided that any
such information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the
Trustee within fifteen (15) days after the same is so required to be filed with
the Commission.
(b) During any period in which the Company is not subject to Section
13 or 15(d) under the Exchange Act, the Company will deliver to the Trustee (a)
as soon as available and in any event within ninety (90) days after the end of
each fiscal year of the Company (i) a consolidated balance sheet of the Company
and its Subsidiaries as of the end of such fiscal year and the related
consolidated statements of operations, stockholders' equity and cash flows for
such fiscal year, all reported on by an independent public accountant of
nationally recognized standing and (ii) a report containing a management's
discussion and analysis of the financial condition and results of operations and
a description of the business and properties of the Company and (b) as soon as
available and in any event within forty-five (45) days after the end of each of
the first three quarters of each fiscal year of the Company (i) an unaudited
consolidated balance sheet of the Company and its Subsidiaries as of the end of
such fiscal quarter and the related consolidated statements of operations,
stockholders' equity and cash flows for such fiscal quarter and (ii) a report
containing a management's discussion and analysis of the financial condition and
results of operations of the Company for such quarter; provided that the
foregoing statements and reports shall not be required for any fiscal year or
quarter, as the case may be, with respect to which the Company files or expects
to file with the Trustee an annual report or quarterly report, as the case may
be, pursuant to the preceding paragraph of this Section 6.4. Delivery of such
reports, information and documents to the Trustee is for informational purposes
only and the Trustee's receipt of such shall not constitute constructive notice
of any information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officer's
Certificates).
ARTICLE VII
DEFAULTS AND REMEDIES
Section 7.1 Events of Default
In case one or more of the following Events of Default (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of
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law or pursuant to any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body) shall have occurred
and be continuing:
(a) default in the payment of the principal of and premium
(including, without limitation, the Holder Conversion Provisional
Payment or the Company Conversion Provisional Payment), if any, on any
of the Notes as and when the same shall become due and payable either at
maturity or in connection with any conversion, redemption, by
declaration or otherwise; or
(b) default for thirty (30) days in the payment of any
installment of interest or Liquidated Damages, if any, upon any of the
Notes as and when the same shall become due and payable; or
(c) failure by the Company to deliver shares of Common Stock
required to be delivered upon conversion of a Note in accordance with
Article XV within ten (10) Business Days of such Conversion Date; or
(d) a default in the payment of the Repurchase Price in respect
of any Note on the repurchase date therefor in accordance with the
provisions of Article XVI; or
(e) failure on the part of the Company duly to observe or perform
any other of the covenants on the part of the Company in the Notes or in
this Indenture (other than default in performance of a covenant that is
specifically dealt with elsewhere in this Section) and the continuance
of such failure for a period of thirty (30) days after the date on which
written notice of such failure, requiring the Company to remedy the
same, shall have been given to the Company by the Trustee, or to the
Company and a Responsible Officer of the Trustee by the holders of at
least 15% in aggregate principal amount of the outstanding Notes at the
time outstanding determined in accordance with Section 9.4; or
(f) failure on the part of the Company to provide a written
notice of a Repurchase Event in accordance with Section 16.2; or
(g) failure on the part of the Company or any Significant
Subsidiary to make any payment at maturity, including any applicable
grace period, in respect of indebtedness of, or guaranteed or assumed
by, the Company or any Significant Subsidiary, in a principal amount
then outstanding in excess of U.S. $3,000,000, and the continuance of
such failure for a period of thirty (30) 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 not less
than 15% in aggregate principal amount of the Notes then outstanding, a
written notice specifying such default and requiring the Company to
cause such default to be cured or waived and stating that such notice is
a "Notice of Default" hereunder; or
(h) default on the part of the Company or any Significant
Subsidiary with respect to any Indebtedness of, or guaranteed or assumed
by, the Company or any Significant Subsidiary, which default results in
the acceleration of indebtedness in a principal amount then outstanding
in excess of U.S. $3,000,000, and such indebtedness
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shall not have been discharged or such acceleration shall not have been
rescinded or annulled for a period of thirty (30) 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 not less
than 15% in aggregate 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 default to be
cured or waived or such acceleration to be rescinded or annulled and
stating that such notice is a "Notice of Default" hereunder; or
(i) the Company or any Significant Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization
or other relief with respect to itself or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect
or seeking the appointment of a trustee, receiver, liquidator, custodian
or other similar official of it or any substantial part of its property,
or shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other
proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as
they become due; or
(j) an involuntary case or other proceeding shall be commenced
against the Company or any Significant Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect
or seeking the appointment of a trustee, receiver, liquidator, custodian
or other similar official of it or any substantial part of its property,
and such involuntary case or other proceeding shall remain undismissed
and unstayed for a period of sixty (60) consecutive days; or
(k) any of the representations or warranties made by the Company
herein or in the Transaction Documents shall be false or misleading in
any material respect at the time made and such condition (to the extent
capable of being cured) shall continue uncured for a period of five (5)
Business 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 not less than 15% in aggregate principal
amount of the Notes then outstanding, a written notice specifying such
default and requiring the Company to cause such default to be cured or
waived and stating that such notice is a "Notice of Default" hereunder;
or
(l) the Company shall fail to duly observe or perform any of the
covenants on the part of the Company in the Transaction Documents (other
than the Notes and this Indenture), and such failure shall continue for
thirty (30) 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 not less than 15% in aggregate principal
amount of the Notes then outstanding, a written notice specifying such
default and requiring the Company to cause such default to be cured or
waived and stating that such notice is a "Notice of Default" hereunder;
then, and in each and every such case (other than an Event of Default specified
in Section 7.1(i) or (j) with respect to the Company), unless the principal of
all of the Notes shall have already
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become due and payable, either the Trustee or the holders of not less than 15%
in aggregate principal amount of the Notes then outstanding hereunder determined
in accordance with Section 9.4, by notice in writing to the Company (and to the
Trustee if given by Noteholders), may declare the principal of and premium, if
any, on all the Notes and the interest accrued thereon (including Liquidated
Damages to the extent accrued and unpaid) to be due and payable immediately, and
upon any such declaration the same shall become and shall be immediately due and
payable, anything in this Indenture or in the Notes contained to the contrary
notwithstanding. If an Event of Default specified in Section 7.1(i) or (j)
occurs and is continuing with respect to the Company, the principal of all the
Notes and the interest accrued thereon (including Liquidated Damages to the
extent accrued and unpaid) shall be immediately due and payable. In addition to
the foregoing, on the thirty-first (31st) day after the occurrence of an Event
of Default and during the continuance of such Event of Default, the rate of
interest on the Notes shall, to the maximum extent permitted by law, be
increased by five percent (5%) per annum (i.e., from 5.25% to 10.25% per annum).
Any such interest which is not paid when due shall, to the maximum extent
permitted by law, accrue interest until paid at the rate from time to time
applicable to the principal of the Notes. Notwithstanding the foregoing if, at
any time after the principal of the Notes shall have been so declared due and
payable, and before any judgment or decree for the payment of the monies due
shall have been obtained or entered as hereinafter provided, the Company shall
pay or shall deposit with the Trustee a sum sufficient to pay all matured
installments of interest upon all Notes and the principal of and premium, if
any, on any and all Notes which shall have become due otherwise than by
acceleration (with interest on overdue installments of interest (to the extent
that payment of such interest is enforceable under applicable law) and on such
principal and premium, if any, at the rate borne by the Notes, to the date of
such payment or deposit) and amounts due to the Trustee pursuant to Section 8.6,
and if any and all defaults under this Indenture, other than the nonpayment of
principal of and premium, if any, and accrued interest on Notes which shall have
become due by acceleration, shall have been cured or waived pursuant to Section
7.7, then and in every such case the holders of a majority in aggregate
principal amount of the Notes then outstanding, by written notice to the Company
and to the Trustee, may waive all defaults or Events of Default and rescind and
annul such acceleration and its consequences; but no such waiver or rescission
and annulment shall extend to or shall affect any subsequent default or Event of
Default, or shall impair any right consequent thereon. The Company shall notify
the Responsible Officer of the Trustee, within two (2) Business Days of becoming
aware thereof, of any default or Event of Default and shall deliver to the
Trustee a statement specifying such default or Event of Default and the action
the Company has taken, is taking or proposes to take with respect thereto.
In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned because
of such waiver or rescission and annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the holders of Notes, and the Trustee shall be restored respectively to
their several positions and rights hereunder, and all rights, remedies and
powers of the Company, the holders of Notes, and the Trustee shall continue as
though no such proceeding had been instituted.
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Section 7.2 Payments of Notes on Default; Suit Therefor
The Company covenants that (a) in case default shall be made in the
payment by the Company of any installment of interest upon any of the Notes as
and when the same shall become due and payable, and such default shall have
continued for a period of thirty (30) days, or (b) in case default shall be made
in the payment of the principal of or premium, if any, on any of the Notes as
and when the same shall have become due and payable, whether at maturity of the
Notes or in connection with any redemption or repurchase, by declaration under
this Indenture or otherwise, then, upon demand of the Trustee, the Company will
pay to the Trustee, for the benefit of the holders of the Notes, the whole
amount that then shall have become due and payable on all such Notes for
principal and premium, if any, or interest, or both, as the case may be, with
interest upon the overdue principal and premium, if any, and (to the extent that
payment of such interest is enforceable under applicable law) upon the overdue
installments of interest at the rate borne by the Notes; and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including reasonable compensation to the Trustee, its
agents, attorneys and counsel, and any expenses or liabilities incurred by the
Trustee hereunder other than through its negligence or bad faith. Until such
demand by the Trustee, the Company may pay the principal of and premium, if any,
and interest on the Notes to the registered holders, whether or not the Notes
are overdue.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on the Notes
and collect in the manner provided by law out of the property of the Company or
any other obligor on the Notes wherever situated the monies adjudged or decreed
to be payable.
In case there shall be pending proceedings for the bankruptcy or for the
reorganization of the Company or any other obligor on the Notes under Title 11
of the United States Code, or any other applicable law, or in case a receiver,
assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator or
similar official shall have been appointed for or taken possession of the
Company or such other obligor, the property of the Company or such other
obligor, the Trustee, irrespective of whether the principal of the Notes shall
then be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand pursuant to the
provisions of this Section 7.2, shall be entitled and empowered, by intervention
in such proceedings or otherwise, to file and prove a claim or claims for the
whole amount of principal, premium, if any, and interest (including Liquidated
Damages, if any) owing and unpaid in respect of the Notes, and, in case of any
judicial proceedings, to file such proofs of claim and other papers or documents
and to take such other actions as it may deem necessary or advisable in order to
have the claims of the Trustee and of the Noteholders allowed in such judicial
proceedings relative to the Company or any other obligor on the Notes, its or
their creditors, or its or their property, and to collect and receive any monies
or other property payable or deliverable on any such claims, and to distribute
the same after the deduction of any amounts due the Trustee under Section 8.6;
and any receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, custodian or similar official is hereby authorized by
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each of the Noteholders to make such payments to the Trustee, and, in the event
that the Trustee shall consent to the making of such payments directly to the
Noteholders, to pay to the Trustee any amount due it for reasonable
compensation, expenses, advances and disbursements, including agents and counsel
fees incurred by it up to the date of such distribution. To the extent that such
payment of reasonable compensation, expenses, advances and disbursements out of
the estate in any such proceedings shall be denied for any reason, payment of
the same shall be secured by a lien on, and shall be paid out of, any and all
distributions, dividends, monies, securities and other property which the
holders of the Notes may be entitled to receive in such proceedings, whether in
liquidation or under any plan of reorganization or arrangement or otherwise.
All rights of action and of asserting claims under this Indenture, or
under any of the Notes, may be enforced by the Trustee without the possession of
any of the Notes, or the production thereof on any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the holders of the Notes.
In any proceedings brought by the Trustee (and in any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the holders
of the Notes, and it shall not be necessary to make any holders of the Notes
parties to any such proceedings.
Section 7.3 Application of Monies Collected by Trustee
Any monies collected by the Trustee pursuant to this Article VII shall
be applied in the following order, at the date or dates fixed by the Trustee for
the distribution of such monies, upon presentation of the several Notes, and
stamping thereon the payment, if only partially paid, and upon surrender
thereof, if fully paid:
First: To the payment of all amounts due the Trustee under
Section 8.6;
Second: To the holders of Senior Indebtedness to the extent
required by Article IV;
Third: In case the principal of the outstanding Notes shall not
have become due and be unpaid, to the payment of interest on the Notes
in default in the order of the maturity of the installments of such
interest, with interest (to the extent that such interest has been
collected by the Trustee) upon the overdue installments of interest at
the rate borne by the Notes, such payments to be made ratably to the
Persons entitled thereto;
Fourth: In case the principal of the outstanding Notes shall have
become due, by declaration or otherwise, and be unpaid, to the payment
of the whole amount then owing and unpaid upon the Notes for principal
and premium, if any, and interest, with interest on the overdue
principal and premium, if any, and (to the extent that such interest has
been collected by the Trustee) upon overdue installments of interest at
the rate borne
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by the Notes; and in case such monies shall be insufficient to pay in
full the whole amounts so due and unpaid upon the Notes, then to the
payment of such principal and premium, if any, and interest without
preference or priority of principal and premium, if any, over interest,
or of interest over principal and premium, if any, or of any installment
of interest over any other installment of interest, or of any Note over
any other Note, ratably to the aggregate of such principal and premium,
if any, and accrued and unpaid interest; and
Fifth: To the payment of the remainder, if any, to the Company.
Section 7.4 Proceedings by Noteholder
Subject to the last two paragraphs of this Section 7.4, no holder of any
Note shall have any right by virtue of or by availing of any provision of this
Indenture to institute any suit, action or proceeding in equity or at law upon
or under or with respect to this Indenture, or for the appointment of a
receiver, trustee, liquidator, custodian or other similar official, or for any
other remedy hereunder, unless such holder previously shall have given to the
Trustee written notice of an Event of Default and of the continuance thereof, as
hereinbefore provided, and unless also the holders of not less than 15% in
aggregate principal amount of the Notes then outstanding shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such indemnity
as may be reasonably satisfactory to the Trustee against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee for sixty (60)
days after its receipt of such notice, request and offer of indemnity, shall
have neglected or refused to institute any such action, suit or proceeding and
no direction inconsistent with such written request shall have been given to the
Trustee pursuant to Section 7.7; it being understood and intended, and being
expressly covenanted by the taker and holder of every Note with every other
taker and holder and the Trustee, that no one or more holders of Notes shall
have any right in any manner whatever by virtue of or by availing of any
provision of this Indenture to affect, disturb or prejudice the rights of any
other holder of Notes, or to obtain or seek to obtain priority over or
preference to any other such holder, or to enforce any right under this
Indenture, except in the manner herein provided and for the equal, ratable and
common benefit of all holders of Notes (except as otherwise provided herein).
For the protection and enforcement of this Section 7.4, each and every
Noteholder and the Trustee shall be entitled to such relief as can be given
either at law or in equity.
Notwithstanding any other provision of this Indenture and any provision
of any Note, the right of any holder of any Note to receive payment of the
principal of and premium, if any, and interest (including Liquidated Damages to
the extent accrued but unpaid) on such Note, on or after the respective due
dates expressed in such Note, or to institute suit for the enforcement of any
such payment on or after such respective dates against the Company shall not be
impaired or affected without the consent of such holder.
Anything in this Indenture or the Notes to the contrary notwithstanding,
the holder of any Note, without the consent of either the Trustee or the holder
of any other Note, in his own behalf and for his own benefit, may enforce, and
may institute and maintain any proceeding suitable to enforce, such holder's
rights of conversion as provided herein.
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Section 7.5 Proceedings by Trustee
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee shall deem
most effectual to protect and enforce any of such rights, either by suit in
equity or by action at law or by proceeding in bankruptcy or otherwise, whether
for the specific enforcement of any covenant or agreement contained in this
Indenture or in aid of the exercise of any power granted in this Indenture, or
to enforce any other legal or equitable right vested in the Trustee by this
Indenture or by law.
Section 7.6 Remedies Cumulative and Continuing
Except as provided in the last paragraph of Section 2.6, all powers and
remedies given by this Article VII to the Trustee or to the Noteholders shall,
to the extent permitted by law, be deemed cumulative and not exclusive of any
thereof or of any other powers and remedies available to the Trustee or the
holders of the Notes, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture, and no delay or omission of the Trustee or of any holder of any of
the Notes to exercise any right or power accruing upon any default or Event of
Default occurring and continuing as aforesaid shall impair any such right or
power, or shall be construed to be a waiver of any such default or any
acquiescence therein; and, subject to the provisions of Section 7.4, every power
and remedy given by this Article VII or by law to the Trustee or to the
Noteholders may be exercised from time to time, and as often as shall be deemed
expedient, by the Trustee or by the Noteholders.
Section 7.7 Direction of Proceedings and Waiver of Defaults by Majority
of Noteholders
The holders of a majority in aggregate principal amount of the Notes at
the time outstanding determined in accordance with Section 9.4 shall have the
right to direct the time, method, and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on
the Trustee; provided, however, that (a) such direction shall not be in conflict
with any rule of law or with this Indenture, and (b) the Trustee may take any
other action deemed proper by the Trustee which is not inconsistent with such
direction. The holders of not less than a majority in aggregate principal amount
of the Notes at the time outstanding determined in accordance with Section 9.4
may on behalf of the holders of all of the Notes waive any past default or Event
of Default hereunder and its consequences except (i) a default in the payment of
interest or premium, if any, on, or the principal of, the Notes when due, (ii) a
failure by the Company to convert any Notes into Common Stock or (iii) a default
in respect of a covenant or provisions hereof which under Article XI cannot be
modified or amended without the consent of all affected holders of Notes then
outstanding. Upon any such waiver the Company, the Trustee and the holders of
the Notes shall be restored to their former positions and rights hereunder; said
default or Event of Default shall for all purposes of the Notes and this
Indenture be deemed to have been cured and to be not continuing; but no such
waiver shall extend to any subsequent or other default or Event of Default or
impair any right consequent thereon.
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Section 7.8 Notice of Defaults
The Trustee shall, within ninety (90) days after the Trustee obtains
knowledge of the occurrence of a default, mail to all Noteholders, as the names
and addresses of such holders appear upon the Note register, notice of all
defaults actually known to a Responsible Officer, unless such defaults shall
have been cured or waived before the giving of such notice; and provided that,
except in the case of default in the payment of the principal of, or premium, if
any, or interest (including Liquidated Damages to the extent accrued but unpaid)
on any of the Notes, including without limiting the generality of the foregoing
any default in the payment of any Repurchase Price or in the payment of any
amount due in connection with any redemption of Notes, then in any such event
the Trustee shall be protected in withholding such notice if and so long as a
trust committee of directors and/or Responsible Officers of the Trustee in good
faith determine that the withholding of such notice is in the interests of the
Noteholders.
Section 7.9 Undertaking to Pay Costs
All parties to this Indenture agree, and each holder of any Note by his
acceptance thereof shall be deemed to have agreed, that any court may, in its
discretion, require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant;
provided that the provisions of this Section 7.9 shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Noteholder, or group of
Noteholders, holding in the aggregate more than 25% in principal amount of the
Notes at the time outstanding determined in accordance with Section 9.4, or to
any suit instituted by any Noteholder for the enforcement of the payment of the
principal of or premium, if any, or interest (including Liquidated Damages to
the extent accrued but unpaid) on any Note (including, but not limited to, the
redemption price or Repurchase Price with respect to the Notes being redeemed or
repurchased as provided in this Indenture) on or after the due date expressed in
such Note or to any suit for the enforcement of the right to convert any Note in
accordance with the provisions of Article XV.
Section 7.10 Delay or Omission Not Waiver
No delay or omission of the Trustee or of any holder of any Note to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or any
acquiescence therein. Every right and remedy given by this Article VII or by law
to the Trustee or to the holders of Notes may be exercised from time to time,
and as often as may be deemed expedient, by the Trustee or by the holders of
Notes, as the case may be.
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ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.1 Duties and Responsibilities of Trustee
The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiver 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 and the Trust Indenture Act. In case an Event of Default has
occurred (which has not been cured or waived) the Trustee shall exercise such of
the rights and powers vested in it by this Indenture, and use the same degree of
care and skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of such person's own affairs.
No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default that may have occurred:
(1) the duties and obligations of the Trustee shall be
determined solely by the Trust Indenture Act and the express
provisions of this Indenture, and the Trustee shall not be liable
except for the performance of such duties and obligations as are
specifically set forth in this Indenture and no implied covenants
or obligations shall be read into this Indenture and the Trust
Indenture Act against the Trustee; and
(2) in the absence of bad faith or willful misconduct on
the part of the Trustee, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions
expressed therein, upon any certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture;
provided, however, in the case of any such certificates or
opinions that by any provisions hereof are specifically required
to be furnished to the Trustee, the Trustee shall be under a duty
to examine the same to determine whether or not they conform to
the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining
the pertinent facts;
(c) the Trustee shall not be liable to any Noteholder with
respect to any action taken or omitted to be taken by it in good faith
in accordance with the direction of the holders of not less than a
majority in principal amount of the Notes at the time outstanding
determined as provided in Section 9.4 relating to the time, method and
place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Indenture; and
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(d) whether or not therein provided, every provision of this
Indenture relating to the conduct or affecting the liability of, or
affording protection to, the Trustee shall be subject to the provisions
of this Section.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
Section 8.2 Reliance on Documents, Opinions, Etc.
Except as otherwise provided in Section 8.1:
(a) the Trustee may conclusively rely and shall be protected in
acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, bond, note, coupon or other
paper or document believed by it in good faith to be genuine and to have
been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company
mentioned herein shall be sufficiently evidenced by an Officer's
Certificate (unless other evidence in respect thereof be herein
specifically prescribed) and any resolution of the Board of Directors
may be evidenced to the Trustee by a copy thereof certified by the
Secretary or an Assistant Secretary of the Company;
(c) the Trustee may consult with counsel of its selection, and
any advice of such counsel or Opinion of Counsel as to matters of law
shall be full and complete authorization and protection in respect of
any action taken or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel if such counsel was
selected 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,
order or direction of any of the Noteholders pursuant to the provisions
of this Indenture, unless such Noteholders shall have offered to the
Trustee reasonable security or indemnity reasonably satisfactory to it
against the costs, expenses and liabilities which may be incurred
therein or thereby;
(e) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture or other paper or document, but the Trustee, in its
reasonable discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company,
personally or by agent or attorney; provided, however, that if the
payment within a reasonable time to the Trustee of the costs, expenses
or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured
to the Trustee by the security afforded to it by the terms
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of this Indenture, the Trustee may require indemnity reasonably
satisfactory to the Trustee from the Noteholders against such expenses
or liability as a condition to so proceeding; the reasonable expenses of
every such examination shall be paid by the Company or, if paid by the
Trustee or any predecessor Trustee, shall be repaid by the Company upon
demand;
(f) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents
or attorneys and the Trustee shall not be responsible for any misconduct
or negligence on the part of any agent or attorney appointed by it with
due care hereunder;
(g) the Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably
believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture;
(h) the Trustee shall not be deemed to have notice of any default
or Event of Default unless a Responsible Officer of the Trustee has
actual knowledge thereof or unless written notice of any event which is
in fact such a default or Event of Default is received by the Trustee at
the Corporate Trust Office of the Trustee, and such notice references
the Notes and this Indenture;
(i) the rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee
in each of its capacities hereunder, and to each agent, custodian and
other Person employed to act hereunder; and
(j) the Trustee may request that the Company deliver an Officer's
Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to
this Indenture, which Officer's Certificate may be signed by any person
authorized to sign an Officer's Certificate, including any person
specified as so authorized in any such certificate previously delivered
and not superseded.
In no event shall the Trustee be liable for any consequential loss or damage of
any kind whatsoever (including but not limited to lost profits), even if the
Trustee has been advised of the likelihood of such loss or damage and regardless
of the form of action unless such loss or damage results from the Trustee's
willful misconduct or gross negligence.
Section 8.3 No Responsibility for Recitals, Etc.
The recitals contained herein and in the Notes (except in the Trustee's
certificate of authentication) shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for the correctness of the same. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Notes. The Trustee shall not be accountable for the use or
application by the Company of any Notes or the proceeds of any Notes
authenticated and delivered by the Trustee in conformity with the provisions of
this Indenture.
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Section 8.4 Trustee, Paying Agents, Conversion Agents or Registrar May
Own Notes
The Trustee, any paying agent, any conversion agent or Note registrar,
in its individual or any other capacity, may become the owner or pledgee of
Notes with the same rights it would have if it were not Trustee, paying agent,
conversion agent or Note registrar.
Section 8.5 Monies to be Held in Trust
Subject to the provisions of Section 13.4, all monies received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received. Money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as may be agreed in writing from time to time by
the Company and the Trustee.
Section 8.6 Compensation and Expenses of Trustee
The Company covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to, such compensation as the Company and
the Trustee shall from time to time agree in writing for all services rendered
by it hereunder in any capacity (which shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust), and the
Company will pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances reasonably incurred or made by the Trustee
in accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel and of all Persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence, willful misconduct or
bad faith. The Company also covenants to indemnify the Trustee or any
predecessor Trustee in any capacity under this Indenture and its agents and any
authenticating agent for, and to hold them harmless against, any and all loss,
damages, claims, liability or expense incurred without negligence, willful
misconduct or bad faith on the part of the Trustee or such agent or
authenticating agent, as the case may be, and arising out of or in connection
with the acceptance or administration of this trust or in any other capacity
hereunder, including the costs and expenses of defending themselves against any
claim (whether asserted by the Company, a Holder or any other Person) of
liability in the premises. The obligations of the Company under this Section 8.6
to compensate or indemnify the Trustee and to pay or reimburse the Trustee for
expenses, disbursements and advances shall be secured by a lien upon all
property and funds held or collected by the Trustee as such, except, subject to
the effect of Sections 4.3 and 7.5, funds held in trust herewith for the benefit
of the holders of particular Notes prior to the date of the accrual of such
unpaid compensation or indemnifiable claim. The obligation of the Company under
this Section 8.6 shall survive the satisfaction and discharge of this Indenture.
The indemnification provided in this Section 8.6 shall extend to the officers,
directors, agents and employees of the Trustee.
When the Trustee and its agents and any authenticating agent incur
expenses or render services after an Event of Default specified in Section
7.1(i) or (j) occurs, the expenses and the
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compensation for the services are intended to constitute expenses of
administration under any bankruptcy, insolvency or similar laws.
Section 8.7 Officer's Certificate as Evidence
Except as otherwise provided in Section 8.1, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
omitting any action hereunder, such matter (unless other evidence in respect
thereof be herein specifically prescribed) may, in the absence of negligence,
willful misconduct, recklessness or bad faith on the part of the Trustee, be
deemed to be conclusively proved and established by an Officer's Certificate
delivered to the Trustee, and such Officer's Certificate, in the absence of
negligence, willful misconduct, recklessness or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action taken or omitted by
it under the provisions of this Indenture upon the faith thereof.
Section 8.8 Conflicting Interests of Trustee
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
Section 8.9 Eligibility of Trustee
There shall at all times be a Trustee hereunder that shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such and has a
combined capital and surplus (together with its corporate parent) of at least
$50,000,000. If such Person publishes reports of condition at least annually,
pursuant to law or to the requirements of any supervising or examining
authority, then for the purposes of this Section 8.9, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section 8.9, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article VIII.
Section 8.10 Resignation or Removal of Trustee
(a) The Trustee may at any time resign by giving written notice
of such resignation to the Company and by mailing notice thereof to the
holders of Notes at their addresses as they shall appear on the Note
register. Upon receiving such notice of resignation, the Company shall
promptly appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of
which instrument shall be delivered to the resigning Trustee and one
copy to the successor trustee. If no successor trustee shall have been
so appointed and have accepted appointment sixty (60) days after the
mailing of such notice of resignation to the Noteholders, the resigning
Trustee may, at the expense of the Company, petition any court of
competent jurisdiction for the appointment of a successor trustee, or
any Noteholder who has been a bona fide holder of a Note or Notes for at
least six months may, subject to the provisions of Section 7.9, on
behalf of himself and all others similarly
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situated, petition any such court for the appointment of a successor
trustee. Such court may thereupon, after such notice, if any, as it may
deem proper and prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with Section 8.8
within a reasonable time after written request therefor by the
Company or by any Noteholder who has been a bona fide holder of a
Note or Notes for at least six months, or
(2) the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.9 and shall fail to resign after
written request therefor by the Company or by any such
Noteholder, or
(3) the Trustee shall become incapable of acting, or shall
be adjudged a bankrupt or insolvent, or a receiver of the Trustee
or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, the Company may by a Board Resolution remove the
Trustee and appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of
which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee, or, subject to the provisions of Section
7.9, any Noteholder who has been a bona fide holder of a Note or Notes
for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor trustee. Such
court may thereupon, after such notice, if any, as it may deem proper
and prescribe, remove the Trustee and appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount of
the Notes at the time outstanding may at any time remove the Trustee and
nominate a successor trustee which shall be deemed appointed as
successor trustee unless within ten (10) days after notice to the
Company of such nomination the Company objects thereto, in which case
the Trustee so removed or any Noteholder, upon the terms and conditions
and otherwise as in Section 8.10(a) provided, may, at the expense of the
Company, petition any court of competent jurisdiction for an appointment
of a successor trustee.
(d) Any resignation or removal of the Trustee and appointment of
a successor trustee pursuant to any of the provisions of this Section
8.10 shall become effective upon acceptance of appointment by the
successor trustee as provided in Section 8.11.
Section 8.11 Acceptance by Successor Trustee
Any successor trustee appointed as provided in Section 8.10 shall
execute, acknowledge and deliver to the Company and to its predecessor trustee
an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall
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become effective and such successor trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as trustee herein; but, nevertheless, on the written request of the
Company or of the successor trustee, the trustee ceasing to act shall, upon
payment of any amounts then due it pursuant to the provisions of Section 8.6,
execute and deliver an instrument transferring to such successor trustee all the
rights and powers of the trustee so ceasing to act. Upon request of any such
successor trustee, the Company shall execute any and all instruments in writing
for more fully and certainly vesting in and confirming to such successor trustee
all such rights and powers. Any trustee ceasing to act shall, nevertheless,
retain a lien upon all property and funds held or collected by such trustee as
such, except for funds held in trust for the benefit of holders of particular
Notes, to secure any amounts then due it pursuant to the provisions of Section
8.6.
No successor trustee shall accept appointment as provided in this
Section 8.11 unless at the time of such acceptance such successor trustee shall
be qualified under the provisions of Section 8.8 and be eligible under the
provisions of Section 8.9.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.11, each of the Company and the former trustee shall mail or
cause to be mailed notice of the succession of such trustee hereunder to the
holders of Notes at their addresses as they shall appear on the Note register.
If the Company fails to mail such notice within ten (10) days after acceptance
of appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Company.
Section 8.12 Succession by Merger, Etc.
Any corporation or other entity into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation or other entity succeeding to all or substantially all
of the corporate trust business of the Trustee (including the trust created by
this Indenture), shall be the successor to the Trustee hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that in the case of any corporation succeeding to all
or substantially all of the corporate trust business of the Trustee such
corporation shall be qualified under the provisions of Section 8.8 and eligible
under the provisions of Section 8.9.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture, any of the Notes shall have been authenticated
but not delivered, any such successor to the Trustee may adopt the certificate
of authentication of any predecessor trustee or authenticating agent appointed
by such predecessor trustee, and deliver such Notes so authenticated; and in
case at that time any of the Notes shall not have been authenticated, any
successor to the Trustee or an authenticating agent appointed by such successor
trustee may authenticate such Notes either in the name of any predecessor
trustee hereunder or in the name of the successor trustee; and in all such cases
such certificates shall have the full force which it is anywhere in the Notes or
in this Indenture provided that the certificate of the Trustee shall have;
provided, however, that the right to adopt the certificate of authentication of
any predecessor
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Trustee or to authenticate Notes in the name of any predecessor Trustee shall
apply only to its successor or successors by merger, conversion or
consolidation.
Section 8.13 Limitation on Rights of Trustee as Creditor
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Notes), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of the claims
against the Company (or any such other obligor).
ARTICLE IX
CONCERNING THE NOTEHOLDERS
Section 9.1 Action by Noteholders
Whenever in this Indenture it is provided that the holders of a
specified percentage in aggregate principal amount of the Notes may take any
action (including the making of any demand or request, the giving of any notice,
consent or waiver or the taking of any other action), the fact that at the time
of taking any such action, the holders of such specified percentage have joined
therein may be evidenced (a) by any instrument or any number of instruments of
similar tenor executed by Noteholders in person or by agent or proxy appointed
in writing, or (b) by the record of the holders of Notes voting in favor thereof
at any meeting of Noteholders duly called and held in accordance with the
provisions of Article X, or (c) by a combination of such instrument or
instruments and any such record of such a meeting of Noteholders. Whenever the
Company or the Trustee solicits the taking of any action by the holders of the
Notes, the Company or the Trustee may fix in advance of such solicitation, a
date as the record date for determining holders entitled to take such action.
The record date shall be not more than fifteen (15) days prior to the date of
commencement of solicitation of such action.
Section 9.2 Proof of Execution by Noteholders
Subject to the provisions of Sections 8.1, 8.2 and 10.5, proof of the
execution of any instrument by a Noteholder or his agent or proxy shall be
sufficient if made in accordance with such reasonable rules and regulations as
may be prescribed by the Trustee or in such manner as shall be satisfactory to
the Trustee. The holding of Notes shall be proved by the Note register or by a
certificate of the Note registrar. The record of any Noteholders' meeting shall
be proved in the manner provided in Section 10.6.
Section 9.3 Who Are Deemed Absolute Owners
The Company, the Trustee, any authenticating agent, any paying agent,
any conversion agent and any Note registrar may deem the Person in whose name
such Note shall be registered upon the Note register to be, and may treat him
as, the absolute owner of such Note (whether or not such Note shall be overdue
and notwithstanding any notation of ownership or other writing thereon) for the
purpose of receiving payment of or on account of the principal of, premium, if
any, and interest (including Liquidated Damages to the extent accrued but
unpaid) on such Note,
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for conversion of such Note and for all other purposes; and neither the Company
nor the Trustee nor any authenticating agent nor any paying agent nor any
conversion agent nor any Note registrar shall be affected by any notice to the
contrary. All such payments so made to any holder for the time being, or upon
his order, shall be valid, and, to the extent of the sum or sums so paid,
effectual to satisfy and discharge the liability for monies payable upon any
such Note.
Section 9.4 Company-Owned Notes Disregarded
In determining whether the holders of the requisite aggregate principal
amount of Notes have concurred in any direction, consent, waiver or other action
under this Indenture, Notes that are owned by the Company or any other obligor
on the Notes or by any Person directly or indirectly controlling or controlled
by or under direct or indirect common control with the Company or any other
obligor on the Notes shall be disregarded and deemed not to be outstanding for
the purpose of any such determination; provided that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, consent, waiver or other action only Notes which a Responsible
Officer actually knows are so owned shall be so disregarded. Notes so owned
which have been pledged in good faith may be regarded as outstanding for the
purposes of this Section 9.4 if the pledgee shall establish to the satisfaction
of the Trustee the pledgee's right to vote such Notes and that the pledgee is
not the Company, any other obligor on the Notes or a Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any such other obligor. In the case of a dispute as
to such right, any decision by the Trustee taken upon the advice of counsel
shall be full protection to the Trustee. Upon request of the Trustee, the
Company shall furnish to the Trustee promptly an Officer's Certificate listing
and identifying all Notes, if any, known by the Company to be owned or held by
or for the account of any of the above described Persons; and, subject to
Section 8.1, the Trustee shall be entitled to accept such Officer's Certificate
as conclusive evidence of the facts therein set forth and of the fact that all
Notes listed therein are not outstanding for the purpose of any such
determination.
Section 9.5 Revocation of Consents; Future Holders Bound
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 9.1, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Notes specified in this
Indenture in connection with such action, any holder of a Note which is shown by
the evidence to be included in the Notes the holders of which have consented to
such action may, by filing written notice with the Trustee at its Corporate
Trust Office and upon proof of holding as provided in Section 9.2, revoke such
action so far as concerns such Note. Except as aforesaid, any such action taken
by the holder of any Note shall be conclusive and binding upon such holder and
upon all future holders and owners of such Note and of any Notes issued in
exchange or substitution therefor, irrespective of whether any notation in
regard thereto is made upon such Note or any Note issued in exchange or
substitution therefor.
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ARTICLE X
NOTEHOLDERS' MEETINGS
Section 10.1 Purpose of Meetings
A meeting of Noteholders may be called at any time and from time to time
pursuant to the provisions of this Article X for any of the following purposes:
(1) to give any notice to the Company or to the Trustee or to
give any directions to the Trustee permitted under this Indenture, or to
consent to the waiving of any default or Event of Default hereunder and
its consequences, or to take any other action authorized to be taken by
Noteholders pursuant to any of the provisions of Article VII;
(2) to remove the Trustee and nominate a successor trustee
pursuant to the provisions of Article VIII;
(3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 11.2;
(4) to take any other action authorized to be taken by or on
behalf of the holders of any specified aggregate principal amount of the
Notes under any other provision of this Indenture or under applicable
law; or
(5) to take any other action authorized by this Indenture or
under applicable law.
Section 10.2 Call of Meetings by Trustee
The Trustee may at any time call a meeting of Noteholders to take any
action specified in Section 10.1, to be held at such time and at such place in
the Borough of Manhattan, The City of New York, as the Trustee shall determine.
Notice of every meeting of the Noteholders, setting forth the time and the place
of such meeting and in general terms the action proposed to be taken at such
meeting and the establishment of any record date pursuant to Section 9.1, shall
be mailed to holders of Notes at their addresses as they shall appear on the
Note register. Such notice shall also be mailed to the Company. Such notices
shall be mailed not less than twenty (20) nor more than ninety (90) days prior
to the date fixed for the meeting.
Any meeting of Noteholders shall be valid without notice if the holders
of all Notes then outstanding are present in person or by proxy or if notice is
waived before or after the meeting by the holders of all Notes outstanding, and
if the Company and the Trustee are either present by duly authorized
representatives or have, before or after the meeting, waived notice.
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Section 10.3 Call of Meetings by Company or Noteholders
In case at any time the Company, pursuant to a resolution of its Board
of Directors, or the holders of at least 10% in aggregate principal amount of
the Notes then outstanding, shall have requested the Trustee to call a meeting
of Noteholders, by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have mailed the
notice of such meeting within twenty (20) days after receipt of such request,
then the Company or such Noteholders may determine the time and the place for
such meeting and may call such meeting to take any action authorized in Section
10.1, by mailing notice thereof as provided in Section 10.2.
Section 10.4 Qualifications for Voting
To be entitled to vote at any meeting of Noteholders a Person shall (a)
be a holder of one or more Notes on the record date pertaining to such meeting
or (b) be a Person appointed by an instrument in writing as proxy by a holder of
one or more Notes. The only Persons who shall be entitled to be present or to
speak at any meeting of Noteholders shall be the Persons entitled to vote at
such meeting and their counsel and any representatives of the Trustee and its
counsel and any representatives of the Company and its counsel.
Section 10.5 Regulations
Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Noteholders, in regard to proof of the holding of Notes and of the appointment
of proxies, and in regard to the appointment and duties of inspectors of votes,
the submission and examination of proxies, certificates and other evidence of
the right to vote, and such other matters concerning the conduct of the meeting
as it shall think fit.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Noteholders as provided in Section 10.3, in which case the Company
or the Noteholders calling the meeting, as the case may be, shall in like manner
appoint a temporary chairman. A permanent chairman and a permanent secretary of
the meeting shall be elected by vote of the holders of a majority in principal
amount of the Notes represented at the meeting and entitled to vote at the
meeting.
Subject to the provisions of Section 9.4, at any meeting each Noteholder
or proxyholder shall be entitled to one vote for each $1,000 principal amount of
Notes held or represented by him; provided, however, that no vote shall be cast
or counted at any meeting in respect of any Note challenged as not outstanding
and ruled by the chairman of the meeting to be not outstanding. The chairman of
the meeting shall have no right to vote other than by virtue of Notes held by
him or instruments in writing as aforesaid duly designating him as the proxy to
vote on behalf of other Noteholders. Any meeting of Noteholders duly called
pursuant to the provisions of Section 10.2 or 10.3 may be adjourned from time to
time by the holders of a majority of the aggregate principal amount of Notes
represented at the meeting, whether or not constituting a quorum, and the
meeting may be held as so adjourned without further notice.
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Section 10.6 Voting
The vote upon any resolution submitted to any meeting of Noteholders
shall be by written ballot on which shall be subscribed the signatures of the
holders of Notes or of their representatives by proxy and the principal amount
of the Notes held or represented by them. The permanent chairman of the meeting
shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all
votes cast at the meeting. A record in duplicate of the proceedings of each
meeting of Noteholders shall be prepared by the secretary of the meeting and
there shall be attached to said record the original reports of the inspectors of
votes on any vote by ballot taken thereat and affidavits by one or more persons
having knowledge of the facts setting forth a copy of the notice of the meeting
and showing that said notice was mailed as provided in Section 10.2. The record
shall show the principal amount of the Notes voting in favor of or against any
resolution. The record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one of the duplicates shall
be delivered to the Company and the other to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
Section 10.7 No Delay of Rights by Meeting
Nothing contained in this Article X shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Noteholders or any
rights expressly or implicitly conferred hereunder to make such call, any
hindrance or delay in the exercise of any right or rights conferred upon or
reserved to the Trustee or to the Noteholders under any of the provisions of
this Indenture or of the Notes.
ARTICLE XI
AMENDMENTS; SUPPLEMENTAL INDENTURES
Section 11.1 Amendments; Supplemental Indentures without Consent of
Noteholders
The Company, when authorized by the resolutions of the Board of
Directors, and the Trustee may from time to time and at any time enter into
amendments or indentures supplemental hereto for one or more of the following
purposes:
(a) to make provision with respect to the conversion rights of
the holders of Notes pursuant to the requirements of Section 15.7;
(b) to convey, transfer, assign, mortgage or pledge to the
Trustee as security for the Notes, any property or assets;
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(c) to evidence the succession of another corporation, limited
liability company, partnership or trust to the Company, or successive
successions, and the assumption by the successor corporation, limited
liability company, partnership or trust of the covenants, agreements and
obligations of the Company pursuant to Article XII;
(d) to add to the covenants of the Company such further
covenants, restrictions or conditions as the Board of Directors and the
Trustee shall consider to be for the benefit of the holders of Notes,
including without limitation any reduction of the Conversion Price, and
to make the occurrence, or the occurrence and continuance, of a default
in any such additional covenants, restrictions or conditions a default
or an Event of Default permitting the enforcement of all or any of the
several remedies provided in this Indenture as herein set forth;
provided, however, that in respect of any such additional covenant,
restriction or condition such supplemental indenture may provide for a
particular period of grace after default (which period may be shorter or
longer than that allowed in the case of other defaults) or may provide
for an immediate enforcement upon such default or may limit the remedies
available to the Trustee upon such default;
(e) to provide for the issuance under this Indenture of Notes in
coupon form (including Notes registrable as to principal only) and to
provide for exchangeability of such Notes with the Notes issued
hereunder in fully registered form and to make all appropriate changes
for such purpose;
(f) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture which may be
defective or inconsistent with any other provision contained herein or
in any supplemental indenture, or to make such other provisions in
regard to matters or questions arising under this Indenture which shall
not materially adversely affect the interests of the holders of the
Notes;
(g) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Notes; or
(h) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the
qualifications of this Indenture under the Trust Indenture Act, or under
any similar federal statute hereafter enacted.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer and assignment of any property thereunder; provided,
however, the Trustee shall not be obligated to and may, in its discretion, enter
into any supplemental indenture that affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Any amendment or supplemental indenture authorized by the provisions of
this Section 11.1 may be executed by the Company and the Trustee without the
consent of the holders of any of the Notes at the time outstanding,
notwithstanding any of the provisions of Section 11.2.
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Section 11.2 Amendments; Supplemental Indentures with Consent of
Noteholders
With the consent (evidenced as provided in Article IX) of the holders of
not less than a majority in aggregate principal amount of the Notes at the time
outstanding (determined in accordance with Section 9.4), the Company, when
authorized by the resolutions of the Board of Directors, and the Trustee may
from time to time and at any time enter into amendments or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or any
supplemental indenture or of modifying in any manner the rights of the holders
of the Notes; provided, however, that no such amendment or supplemental
indenture shall (i) extend the fixed maturity of any Note, or reduce the rate or
extend the time of payment of interest thereon, or reduce the principal amount
thereof or premium, if any, thereon, or reduce any amount payable on redemption
or repurchase thereof, impair, or change in any respect adverse to the holder of
Notes, the obligation of the Company to repurchase any Note at the option of the
holder upon the happening of a Repurchase Event, or impair or adversely affect
the right of any Noteholder to institute suit for the payment thereof, or change
the currency in which the Notes are payable, or impair or change in any respect
adverse to the Noteholders the right to convert the Notes into Common Stock
subject to the terms set forth herein, including Section 15.7, without the
consent of the holder of each Note so affected, or (ii) reduce the aforesaid
percentage of Notes, the holders of which are required to consent to any such
supplemental indenture, or modify this paragraph, without the consent of the
holders of all Notes then outstanding.
Upon the request of the Company, accompanied by a copy of the
resolutions of the Board of Directors certified by its Secretary or Assistant
Secretary authorizing the execution of any such amendment or supplemental
indenture, and upon the filing with the Trustee of evidence of the consent of
Noteholders as aforesaid, the Trustee shall join with the Company in the
execution of such amendment or supplemental indenture unless such amendment or
supplemental indenture affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise, in which case the Trustee may in is
discretion, but shall not be obligated to, enter into such amendment or
supplemental indenture.
It shall not be necessary for the consent of the Noteholders under this
Section 11.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Section 11.3 Effect of Amendments and Supplemental Indentures
Any amendment or supplemental indenture executed pursuant to the
provisions of this Article XI shall comply with the Trust Indenture Act, as then
in effect; provided that this Section 11.3 shall not require such amendment or
supplemental indenture or the Trustee to be qualified under the Trust Indenture
Act prior to the time such qualification is in fact required under the terms of
the Trust Indenture Act or the Indenture has been qualified under the Trust
Indenture Act, nor shall it constitute any admission or acknowledgement by any
party to such amendment or supplemental indenture that any such qualification is
required prior to the time such qualification is in fact required under the
terms of the Trust Indenture Act or the Indenture has been qualified under the
Trust Indenture Act. Upon the execution of any amendment or
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supplemental indenture pursuant to the provisions of this Article XI, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitation of rights, obligations, duties
and immunities under this Indenture of the Trustee, the Company and the holders
of Notes shall thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments and all the terms
and conditions of any such supplemental indenture shall be and be deemed to be
part of the terms and conditions of this Indenture for any and all purposes.
Section 11.4 Notation on Notes
Notes authenticated and delivered after the execution of any amendment
or supplemental indenture pursuant to the provisions of this Article XI may bear
a notation in form approved by the Trustee as to any matter provided for in such
amendment or supplemental indenture. If the Company or the Trustee shall so
determine, new Notes so modified as to conform, in the opinion of the Trustee
and the Board of Directors, to any modification of this Indenture contained in
any such amendment or supplemental indenture may, at the Company's expense, be
prepared and executed by the Company, authenticated by the Trustee (or an
authenticating agent duly appointed by the Trustee pursuant to Section 17.11)
and delivered in exchange for the Notes then outstanding, upon surrender of such
Notes then outstanding.
Section 11.5 Evidence of Compliance of Amendment or Supplemental
Indenture to be Furnished to Trustee
The Trustee, subject to the provisions of Sections 8.1 and 8.2, shall
receive an Officer's Certificate and an Opinion of Counsel as conclusive
evidence that any amendment or supplemental indenture executed pursuant hereto
complies with the requirements of this Article XI.
ARTICLE XII
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
Section 12.1 Company May Consolidate, Etc.
The Company shall not, directly or indirectly, consolidate with or merge
with or into any other Person or sell, lease, convey or transfer all or
substantially all its assets, whether in a single transaction or a series of
related transactions, to any Person or group of affiliated Persons unless:
(a) either (i) in the case of a merger or consolidation that
does not involve a transfer of all or substantially all of the Company's
properties and assets, the Company is the surviving entity or (ii) in
case the Company shall consolidate with or merge into another Person or
sell, lease, convey or transfer all or substantially all assets, whether
in a single transaction or a series of related transactions, to any
Person, the Person formed by such consolidation or into which the
Company is merged, or the Person which acquires by sale, conveyance or
transfer, or which leases the properties and assets of the Company
substantially as an entirety, shall be a corporation, limited liability
company, partnership
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or trust, shall be organized and validly existing under the laws of the
United States of America, any state thereof or the District of Columbia
and shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Trustee, in form satisfactory to the
Trustee, the due and punctual payment of the principal of, premium, if
any, and interest (including Liquidated Damages, if any) on all of the
Notes as applicable, and the performance or observance of every covenant
of this Indenture on the part of the Company to be performed or observed
and shall have provided for the applicable conversion rights set forth
in Section 15.7 and the repurchase rights set forth in Article XVI;
(b) immediately after giving effect to such transaction, no
Event of Default, and no event that after notice or lapse of time or
both, would become an Event of Default, shall have happened and be
continuing; and
(c) the Company has delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such transaction,
such supplemental indenture complies with this Article XII and that all
conditions precedent herein provided for relating to such transaction
have been complied with, together with any documents required under
Article IX.
Section 12.2 Successor Entity to be Substituted
In case of any such consolidation, merger, sale, conveyance or lease in
accordance with Section 12.1, and, where required in accordance with Section
12.1(a) upon the assumption by the successor entity, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the due and punctual payment of the principal of and premium, if any, and
interest (including Liquidated Damages, if any) on all of the Notes and the due
and punctual performance of all of the covenants and conditions of this
Indenture to be performed by the Company, such successor entity shall succeed to
and be substituted for the Company, with the same effect as if it had been named
herein as the party of the first part. Such successor entity thereupon may cause
to be signed, and may issue either in its own name or in the name of
Electroglas, Inc. any or all of the Notes issuable hereunder which theretofore
shall not have been signed by the Company and delivered to the Trustee; and,
upon the order of such successor entity instead of the Company and subject to
all the terms, conditions and limitations in this Indenture prescribed, the
Trustee shall authenticate and shall deliver, or cause to be authenticated and
delivered, any Notes which previously shall have been signed and delivered by
the officers of the Company to the Trustee for authentication, and any Notes
which such successor entity thereafter shall cause to be signed and delivered to
the Trustee for that purpose. All the Notes so issued shall in all respects have
the same legal rank and benefit under this Indenture as the Notes theretofore or
thereafter issued in accordance with the terms of this Indenture as though all
of such Notes had been issued at the date of the execution hereof. In the event
of any such consolidation, merger, sale, conveyance or lease, the Person named
as the "Company" in the first paragraph of this Indenture or any successor which
shall thereafter have become such in the manner prescribed in this Article XII
may be dissolved, wound up and
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liquidated at any time thereafter and such Person shall be released from its
liabilities as obligor and maker of the Notes and from its obligations under
this Indenture.
In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form (but not in substance) may be made in the
Notes thereafter to be issued as may be appropriate.
Section 12.3 Opinion of Counsel to be Given Trustee
The Trustee, subject to Sections 8.1 and 8.2, shall receive an Officer's
Certificate and an Opinion of Counsel as conclusive evidence that any such
consolidation, merger, sale, conveyance or lease and any such assumption
complies with the provisions of this Article XII.
ARTICLE XIII
SATISFACTION AND DISCHARGE OF INDENTURE
Section 13.1 Discharge of Indenture
When (a) the Company shall deliver to the Trustee for cancellation all
Notes theretofore authenticated (other than any Notes that have been destroyed,
lost or stolen and in lieu of or in substitution for which other Notes shall
have been authenticated and delivered) and not theretofore canceled, or (b) all
the Notes not theretofore canceled or delivered to the Trustee for cancellation
shall have become due and payable, or are by their terms to become due and
payable within one year or are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of redemption,
and the Company shall deposit with the Trustee, in trust, funds sufficient to
pay at maturity or upon redemption of all of the Notes (other than any Notes
which shall have been mutilated, destroyed, lost or stolen and in lieu of or in
substitution for which other Notes shall have been authenticated and delivered)
not theretofore canceled or delivered to the Trustee for cancellation, including
principal and premium, if any, and interest (including Liquidated Damages, if
any) due or to become due to such date of maturity or redemption date, as the
case may be, and if in either case the Company shall also pay or cause to be
paid all other sums payable hereunder by the Company, then this Indenture shall
cease to be of further effect (except as to (i) remaining rights of registration
of transfer, substitution and exchange and conversion of Notes, (ii) rights
hereunder of Noteholders to receive payments of principal of and premium, if
any, and interest on, the Notes and the other rights, duties and obligations of
Noteholders, as beneficiaries hereof with respect to the amounts, if any, so
deposited with the Trustee and (iii) the rights, obligations and immunities of
the Trustee hereunder), and the Trustee, on demand of the Company accompanied by
an Officer's Certificate and an Opinion of Counsel as required by Section 17.5
and at the cost and expense of the Company, shall execute proper instruments
acknowledging satisfaction of and discharging this Indenture; the Company,
however, hereby agreeing to reimburse the Trustee for any costs or expenses
thereafter reasonably and properly incurred by the Trustee and to compensate the
Trustee for any services thereafter reasonably and properly rendered by the
Trustee in connection with this Indenture or the Notes.
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Section 13.2 Deposited Monies to be Held in Trust by Trustee
Subject to Section 13.4, all monies deposited with the Trustee pursuant
to Section 13.1 shall be held in trust and applied by it to the payment, either
directly or through any paying agent (including the Company if acting as its own
paying agent), to the holders of the particular Notes for the payment or
redemption of which such monies have been deposited with the Trustee, of all
sums due and to become due thereon for principal and interest and premium, if
any.
Section 13.3 Paying Agent to Repay Monies Held
Upon the satisfaction and discharge of this Indenture, all monies then
held by any paying agent of the Notes (other than the Trustee) shall, upon
demand of the Company, be repaid to it or paid to the Trustee, and thereupon
such paying agent shall be released from all further liability with respect to
such monies.
Section 13.4 Return of Unclaimed Monies
Subject to the requirements of applicable law, any monies deposited with
or paid to the Trustee for payment of the principal of, premium, if any, or
interest on Notes and not applied but remaining unclaimed by the holders of
Notes for two (2) years after the date upon which the principal of, premium, if
any, or interest (including Liquidated Damages, if any) on such Notes, as the
case may be, shall have become due and payable, shall be repaid to the Company
by the Trustee on written demand and all liability of the Trustee shall
thereupon cease with respect to such monies; and the holder of any of the Notes
shall thereafter look only to the Company for any payment which such holder may
be entitled to collect unless an applicable abandoned property law designates
another Person.
Section 13.5 Reinstatement
If (i) the Trustee or the paying agent is unable to apply any money in
accordance with Section 13.2 by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application and (ii) the holders of at least a majority in principal amount of
the then outstanding Notes so request by written notice to the Trustee, the
Company's obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 13.1 until such
time as the Trustee or the paying agent is permitted to apply all such money in
accordance with Section 13.2; provided, however, that if the Company makes any
payment of interest on or principal of any Note following the reinstatement of
its obligations, the Company shall be subrogated to the rights of the holders of
such Notes to receive such payment from the money held by the Trustee or paying
agent.
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ARTICLE XIV
NO RECOURSE AGAINST OTHERS
Section 14.1 Indenture and Notes Solely Corporate Obligations
No direct or indirect partner, employee, incorporator, stockholder,
director or officer, as such, past, present or future of the Company or any
successor corporation or any Subsidiary or any of the Company's Affiliates,
shall have any personal liability in respect of the obligations of the Company
under the Notes or this Indenture by reason of his, her or its status as such
partner, employee, incorporator, stockholder, director or officer. Each
Noteholder by accepting a Note waives and releases all such liability. Such
waiver and release are part of the consideration for the issuance of the Notes.
ARTICLE XV
CONVERSION OF NOTES
Section 15.1 Right to Convert
Subject to and upon compliance with the provisions of this Indenture,
the holder of any Note shall have the right, at his option, at any time
following the date of original issuance of the Notes and prior to the close of
business on June 15, 2007 (except that, with respect to any Note or portion of a
Note that shall be called for redemption, such right shall terminate, except as
provided in the fifth paragraph of Section 15.2 and Section 3.4, at the close of
business on the last Business Day prior to the date fixed for redemption of such
Note or portion of a Note unless the Company shall default in payment due upon
redemption thereof), to convert the principal amount of any such Note, or any
portion of such principal amount which is $1,000 or an integral multiple
thereof, into that number of fully paid and non-assessable shares of Common
Stock (as such shares shall then be constituted) obtained by dividing the
principal amount of the Note or portion thereof surrendered for conversion by
the Conversion Price in effect at such time, by surrender of the Note so to be
converted in whole or in part in the manner provided in Section 15.2. A holder
of Notes is not entitled to any rights of a holder of Common Stock until such
holder has converted his Notes to Common Stock, and only to the extent such
Notes are deemed to have been converted to Common Stock under this Article XV. A
Note with respect to which a holder has delivered a notice in accordance with
Section 16.2 regarding such holder's election to require the Company to
repurchase such holder's Notes following the occurrence of a Repurchase Event
may be converted in accordance with this Article XV only if such holder
withdraws such notice by delivering a written notice of withdrawal to the
Company prior to the close of business on the last Business Day prior to the day
fixed for repurchase. If the holder of any Note exercises the right of
conversion set forth in this Article XV prior to March 21, 2003, the Company
shall make an additional payment in cash to such holder with respect to the
Notes converted, in an amount (a "Holder Conversion Provisional Payment") equal
to $39.375 per each $1,000 principal amount of the Note, less the amount of any
interest actually paid on such Note prior to the Conversion Date (and, if such
Note is converted between a record date and the next
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interest payment date, less interest payable on each $1,000 principal amount of
such Note on such interest payment date). The Company may pay any Holder
Conversion Provisional Payment required to be paid pursuant to this Indenture in
whole or in part in cash and/or through the issuance of Common Stock; provided
(i) that Common Stock used to pay any Holder Conversion Provisional Payment
shall be valued at ninety-five percent (95%) of the Current Market Price of the
Common Stock as of the date two (2) Business Days prior to the Conversion Date,
(ii) that a registration statement covering the resale of such Common Stock is
effective and available for resale of such Common Stock from the twenty-fifth
(25th) Trading Date prior to the Conversion Date to and including the Conversion
Date to the extent required under the Registration Rights Agreement and (iii)
such Common Stock is listed for trading on the Principal Market (as defined in
the Securities Purchase Agreement). Notwithstanding the foregoing, a Holder
Conversion Provisional Payment, or portion thereof, shall be paid solely in cash
if payment in shares of Common Stock when such shares are added to the sum of
(1) the shares of Common Stock issued or issuable upon conversion of all the
Notes and Warrants and (2) the shares of Common Stock issued as payment for any
Holder Conversion Provisional Payment paid pursuant to this Indenture, would
cause the Company to issue greater than 19.99% of its aggregate outstanding
capital stock as of June 21, 2002 unless the stockholders of the Company have
otherwise approved such greater issuance of Common Stock.
Section 15.2 Exercise of Conversion Privilege; Issuance of Common Stock
on Conversion
In order to exercise the conversion privilege with respect to any
Definitive Note, the holder of such Definitive Note then registered on the books
of the Company shall (i) deliver a written notice, in the form of the conversion
notice attached as Exhibit A to such Definitive Note, or a reasonable facsimile
thereof (the "Conversion Notice"), to the Company and the conversion agent, of
such holder's election to convert, which notice shall specify that all of such
Note shall be converted or the portion thereof to be converted (which shall be
$1,000 or an integral multiple thereof), (ii) if such Note or portion thereof is
surrendered for conversion during the period from the close of business on the
Business Day preceding the record date for any interest payment date through the
close of business on the Business Day next preceding such interest payment date,
pay by wire transfer of immediately available funds or other method acceptable
to the Company, an amount equal to the interest otherwise payable on such
interest payment date on the principal amount being converted (unless such Note
or portion thereof being converted shall have been called for redemption
pursuant to a redemption notice mailed to the Noteholders in accordance with
Section 3.2 or shall have become due prior to such interest payment date as a
result of a Repurchase Event); provided, however, that no such payment need be
made if (x) there shall exist at the time of conversion a default in the payment
of interest on the Notes, or (y) such converting holder holds a Definitive Note
and requests that such payment be netted against the interest payable with
respect to the converted Note on the next interest payment date, by notifying
the Company and the Trustee of such election not later than two (2) Business
Days prior to the earlier of the Conversion Date and such interest payment date,
and includes in such notification a representation and warranty in favor of the
Company to the effect the such holder has owned such Definitive Note at all
times from and after the Business Day preceding such record date, (iii) pay by
wire transfer of immediately available funds or other method acceptable to the
Company the transfer taxes, if any, required pursuant to Section 15.8,
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and (iv) surrender the Definitive Note to be converted in whole or in part to a
common carrier for overnight delivery to the Company as soon as practicable
following such date (or an indemnification undertaking or other form of security
reasonably satisfactory to the Company with respect to the Definitive Note in
the case of its loss, theft or destruction). Anything herein to the contrary
notwithstanding, in the case of Global Securities, conversion notices may be
delivered and a Participant's interest in a Global Note may be surrendered for
conversion in accordance with the Applicable Procedures as in effect from time
to time. Each Note surrendered for conversion shall, unless the shares issuable
on conversion are to be issued in the same name as the registration of such
Note, be duly endorsed by, or be accompanied by instruments of transfer
(including a broker's letter regarding compliance with the prospectus delivery
requirement, if applicable) in form satisfactory to the Company duly executed
by, the holder or his duly authorized attorney.
The Company shall use its best efforts to, within three (3) Business
Days after the Conversion Date (as defined below) with respect to any Note,
subject to compliance with any restrictions on transfer if shares issuable on
conversion are to be issued in a name other than that of the Noteholder (as if
such transfer were a transfer of the Note or Notes (or portion thereof) so
converted) (a)(i) in the case of a public resale of the Common Stock issuable
upon such conversion, at the holder's request, credit such aggregate number of
shares of Common Stock to which the holder shall be entitled to the holder's or
its designee's balance account with The Depository Trust Company through its
Deposit Withdrawal Agent Commission system or (ii) issue and deliver to the
address as specified in the Conversion Notice, a certificate or certificates in
such denominations as may be requested by the holder in the Conversion Notice,
registered in the name of the holder or its designee, for the number of shares
of Common Stock to which the holder shall be entitled upon such conversion, and
(b) deliver to such holder a check or cash in respect of (i) any fractional
interest in respect of a share of Common Stock arising upon such conversion, as
provided in Section 15.3 and (ii) the Holder Conversion Provisional Payment, if
any (which payment, if any, shall be paid no later than ten (10) Business Days
after the Conversion Date). In case any Note of a denomination greater than
$1,000 shall be surrendered for partial conversion, and subject to Section 2.3,
the Company shall execute and the Trustee shall authenticate and deliver to the
holder of the Note so surrendered, without charge to him, a new Note or Notes in
authorized denominations in an aggregate principal amount equal to the
unconverted portion of the surrendered Note.
If the Company shall not have (a) delivered the number of shares of
Common Stock issued upon conversion of Notes by any holder and (b) made any
Holder Conversion Provisional Payment required pursuant to Section 15.1, within
five (5) Business Days after the Conversion Date with respect to such Notes, the
Company shall pay Liquidated Damages to such holder at the rate of one-half
percent (0.5%) per month of the outstanding principal amount of Notes so
converted by such holder.
The 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 15.2 have been satisfied as to such Note (or portion thereof) (such
date, the "Conversion Date"), and the Person in whose name any shares of Common
Stock shall be issuable upon such conversion shall be deemed to have become on
the Conversion Date the holder of record of the shares represented
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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 at the Conversion Price in effect on the date
upon which such Note shall be surrendered. For purposes of determining
satisfaction of the requirement set forth above with respect to the Conversion
Date for any Note, any facsimile required to be sent shall be deemed to have
been sent on a given day if such facsimile was received before 1:00 p.m., New
York City time, on such date, to the number listed above (unless a different
number is specified in a notice filed with the Trustee and mailed by the
Trustee, at the Company's expense, to each holder of the Notes at such holder's
address appearing in the Note register, as provided for in Section 2.5 of this
Indenture) and a confirmation of transmission of such facsimile is obtained.
The Company shall pay in cash, on any Note or portion thereof
surrendered for conversion during the period from the close of business on any
interest payment date to which interest has been fully paid through the close of
business on the Business Day preceding the record date for the next such
interest payment date, accrued and unpaid interest, if any, on the Note or
portion thereof surrendered for conversion to, but excluding, the date of
conversion, and Liquidated Damages, if any. Any such payment of interest shall
be made with respect to such Note within ten (10) Business Days after the
Conversion Date. Notwithstanding the foregoing, 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 through the close of business on the
Business Day next preceding such interest payment date shall (unless such Note
or portion thereof being converted shall have been called for redemption
pursuant to a redemption notice mailed to the Noteholders in accordance with
Section 3.2 or shall have become due prior to such interest payment date as a
result of a Repurchase Event) 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 if
there shall exist at the time of conversion a default in the payment of interest
on the Notes. Nothing in this Section 15.2 shall affect the right of a Holder in
whose name any Note is registered at the close of business on a record date to
receive the interest payable on such Note on the related interest payment date
in accordance with the terms of this Indenture and the Note. Except as provided
in this Section 15.2, no 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.
Section 15.3 Cash Payments in Lieu of Fractional Shares
No fractional shares of Common Stock or scrip representing fractional
shares 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 which shall be issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Notes (or specified portions
thereof to the extent permitted hereby) so surrendered for conversion. If any
fractional share of stock otherwise would be issuable upon the conversion of any
Note or Notes, the Company shall calculate and pay a cash adjustment in lieu of
such fractional share at the current market value thereof to the holder of
Notes. The current market value of a share of
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Common Stock shall be the Closing Price on the first Trading Day immediately
preceding the day on which the Notes (or specified portions thereof) are deemed
to have been converted and such Closing Price shall be determined as provided in
Section 15.5(f).
Section 15.4 Conversion Price
The conversion price shall be as specified in the form of Note (herein
called the "Conversion Price") attached as Exhibit A hereto, subject to
adjustment as provided in this Article XV.
Section 15.5 Adjustment of Conversion Price
The Conversion Price shall be adjusted from time to time by the Company
as follows:
(a) In case the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of
Common Stock, the Conversion Price in effect at the opening of business
on the date following the date fixed for the determination of
stockholders entitled to receive such dividend or other distribution
shall be reduced by multiplying such Conversion Price by a fraction of
which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the Record Date (as defined in
Section 15.5(f)) fixed for such determination and the denominator shall
be the sum of such number of shares and the total number of shares
constituting such dividend or other distribution, such reduction to
become effective immediately after the opening of business on the day
following the Record Date. If any dividend or distribution of the type
described in this Section 15.5(a) is declared but not so paid or made,
the Conversion Price shall again be adjusted to the Conversion Price
which would then be in effect if such dividend or distribution had not
been declared.
(b) In case the outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock, the
Conversion Price in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall be
proportionately reduced, and conversely, in case outstanding shares of
Common Stock shall be combined into a smaller number of shares of Common
Stock, the Conversion Price in effect at the opening of business on the
day following the day upon which such combination becomes effective
shall be proportionately increased, such reduction or increase, as the
case may be, to become effective immediately after the opening of
business on the day following the day upon which such subdivision or
combination becomes effective.
(c) In case the Company shall issue rights or warrants to all
holders of its outstanding shares of Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share
less than the Current Market Price (as defined in Section 15.5(f)) on
the Record Date fixed for the determination of stockholders entitled to
receive such rights or warrants, the Conversion Price shall be adjusted
so that the same shall equal the price determined by multiplying the
Conversion Price in effect at the
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opening of business on the date after such Record Date by a fraction of
which the numerator shall be the sum of the number of shares of Common
Stock outstanding at the close of business on the Record Date plus the
number of shares that the aggregate offering price of the total number
of shares so offered for subscription or purchase would purchase at such
Current Market Price, and of which the denominator shall be the sum of
the number of shares of Common Stock outstanding at the close of
business on the Record Date plus the total number of additional shares
of Common Stock so offered for subscription or purchase. Such adjustment
shall become effective immediately after the opening of business on the
day following the Record Date fixed for determination of stockholders
entitled to receive such rights or warrants. To the extent that shares
of Common Stock are not delivered pursuant to such rights or warrants,
upon the expiration or termination of such rights or warrants the
Conversion Price shall be readjusted to the Conversion Price that would
then be in effect had the adjustments made upon the issuance of such
rights or warrants been made on the basis of delivery of only the number
of shares of Common Stock actually delivered. In the event that such
rights or warrants are not so issued, the Conversion Price shall again
be adjusted to be the Conversion Price that would then be in effect if
such date fixed for the determination of stockholders entitled to
receive such rights or warrants had not been fixed. In determining
whether any rights or warrants entitle the holders to subscribe for or
purchase shares of Common Stock at less than such Current Market Price,
and in determining the aggregate offering price of such shares of Common
Stock, there shall be taken into account any consideration received for
such rights or warrants, the value of such consideration, if other than
cash, to be determined in good faith by the Board of Directors.
(d) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock shares of any class of
capital stock of the Company (other than any dividends or distributions
to which Section 15.5(a) applies) or evidences of its indebtedness or
other assets (including securities, but excluding (1) any rights or
warrants referred to in Section 15.5(c) and (2) dividends and
distributions paid exclusively in cash (except as set forth in Section
15.5(e) and (f), (the foregoing hereinafter in this Section 15.5(d)
called the "Securities")), unless the Company elects to reserve such
Securities for distribution to the Noteholders upon conversion of the
Notes so that any such holder converting Notes will receive upon such
conversion, in addition to the shares of Common Stock to which such
holder is entitled, the amount and kind of such Securities which such
holder would have received if such holder had converted its Notes into
Common Stock immediately prior to the Record Date (as defined in Section
15.5(f)) for such distribution of the Securities then, in each such
case, the Conversion Price shall be reduced so that the same shall be
equal to the price determined by multiplying the Conversion Price in
effect immediately prior to the close of business on the Record Date (as
defined in Section 15.5(f)) with respect to such distribution by a
fraction of which the numerator shall be the Current Market Price
(determined as provided in Section 15.5(f)) on such date less the fair
market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution)
on such date of the portion of the Securities so distributed applicable
to one share of Common Stock and the denominator shall be such Current
Market Price, such reduction to become effective immediately prior to
the opening of business on the day following the Record Date;
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provided, however, that in the event the then fair market value (as so
determined) of the portion of the Securities so distributed applicable
to one share of Common Stock is equal to or greater than the Current
Market Price on the Record Date, in lieu of the foregoing adjustment,
adequate provision shall be made so that each Noteholder shall have the
right to receive upon conversion of a Note (or any portion thereof) the
amount of Securities such holder would have received had such holder
converted such Note (or portion thereof) immediately prior to such
Record Date. In the event that such dividend or distribution is not so
paid or made, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such dividend or
distribution had not been declared. If the Board of Directors determines
the fair market value of any distribution for purposes of this Section
15.5(d) by reference to the actual or when issued trading market for any
securities comprising all or part of such distribution, it must in doing
so consider the prices in such market over the same period (the
"Reference Period") used in computing the Current Market Price pursuant
to Section 15.5(f) to the extent possible, unless the Board of Directors
in a Board Resolution determines that determining the fair market value
during the Reference Period would not be in the best interest of the
Noteholder.
In the event that the Company implements a new stockholder
rights plan, such rights plan shall provide that upon conversion of the
Notes the holders will receive, in addition to the Common Stock issuable
upon such conversion, the rights issued under such rights plan as if the
holders had converted the Notes prior to implementing the rights plan
and notwithstanding the occurrence of an event causing such rights to
separate from the Common Stock at or prior to the time of conversion.
Any distribution of rights or warrants pursuant to a stockholder rights
plan complying with the requirements set forth in the immediately
preceding sentence of this paragraph shall not constitute a distribution
of rights or warrants for the purposes of this Section 15.5(d).
Rights or warrants distributed by the Company to all holders of
Common Stock entitling the holders thereof to subscribe for or purchase
shares of the Company's capital stock (either initially or under certain
circumstances), which rights or warrants, until the occurrence of a
specified event or events ("Trigger Event"): (i) are deemed to be
transferred with such shares of Common Stock; (ii) are not exercisable;
and (iii) are also issued in respect of future issuances of Common
Stock, shall be deemed not to have been distributed for purposes of this
Section 15.5(d) (and no adjustment to the Conversion Price under this
Section 15.5(d) will be required) until the occurrence of the earliest
Trigger Event. If such right or warrant is subject to subsequent events,
upon the occurrence of which such right or warrant shall become
exercisable to purchase different securities, evidences of indebtedness
or other assets or entitle the holder to purchase a different number or
amount of the foregoing or to purchase any of the foregoing at a
different purchase price, then the occurrence of each such event shall
be deemed to be the date of issuance and record date with respect to a
new right or warrant (and a termination or expiration of the existing
right or warrant without exercise by the holder thereof). In addition,
in the event of any distribution (or deemed distribution) of rights or
warrants, or any Trigger Event or other event (of the type described in
the preceding sentence) with respect thereto, that resulted in an
adjustment to the Conversion Price under this
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Section 15.5(d), (1) in the case of any such rights or warrants that
shall all have been redeemed or repurchased without exercise by any
holders thereof, the Conversion Price shall be readjusted upon such
final redemption or repurchase to give effect to such distribution or
Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price
received by a holder of Common Stock with respect to such rights or
warrants (assuming such holder had retained such rights or warrants),
made to all holders of Common Stock as of the date of such redemption or
repurchase, and (2) in the case of such rights or warrants all of which
shall have expired or been terminated without exercise, the Conversion
Price shall be readjusted as if such rights and warrants had never been
issued.
For purposes of this Section 15.5(d) and Sections 15.5(a) and
(c), any dividend or distribution to which this Section 15.5(d) is
applicable that also includes shares of Common Stock, or rights or
warrants to subscribe for or purchase shares of Common Stock to which
Section 15.5(c) applies (or both), shall be deemed instead to be (1) a
dividend or distribution of the evidences of indebtedness, assets,
shares of capital stock, rights or warrants other than such shares of
Common Stock or rights or warrants to which Section 15.5(c) applies (and
any Conversion Price reduction required by this Section 15.5(e) with
respect to such dividend or distribution shall then be made) immediately
followed by (2) a dividend or distribution of such shares of Common
Stock or such rights or warrants (and any further Conversion Price
reduction required by Sections 15.5(a) and (c) with respect to such
dividend or distribution shall then be made, except (A) the Record Date
of such dividend or distribution shall be substituted as "the date fixed
for the determination of stockholders entitled to receive such dividend
or other distribution", "Record Date fixed for such determination" and
"Record Date" within the meaning of Section 15.5(a) and as "the date
fixed for the determination of stockholders entitled to receive such
rights or warrants", "the Record Date fixed for the determination of the
stockholders entitled to receive such rights or warrants" and "such
Record Date" within the meaning of Section 15.5(c) and (B) any shares of
Common Stock included in such dividend or distribution shall not be
deemed "outstanding at the close of business on the date fixed for such
determination" within the meaning of Section 15.5(a).
(e) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding any cash
that is distributed upon a merger or consolidation to which Section 15.7
applies or as part of a distribution referred to in Section 15.5(d)), in
an aggregate amount that, combined together with (1) the aggregate
amount of any other such distributions to all holders of its Common
Stock made exclusively in cash within the twelve (12) months preceding
the date of payment of such distribution, and in respect of which no
adjustment pursuant to this Section 15.5(e) has been made, and (2) the
aggregate of any cash plus the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and
described in a Board Resolution) of consideration payable in respect of
any tender offer by the Company or any of its subsidiaries for all or
any portion of the Common Stock concluded within the twelve (12) months
preceding the date of payment of such distribution, and in respect of
which no adjustment pursuant to Section 15.5(f) has been made, exceeds
6% of the product of the Current Market Price (determined as provided in
Section 15.5(f)) on the
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Record Date with respect to such distribution times the number of shares
of Common Stock outstanding on such date, then, and in each such case,
immediately after the close of business on such date, the Conversion
Price shall be reduced so that the same shall equal the price determined
by multiplying the Conversion Price in effect immediately prior to the
close of business on such Record Date by a fraction (i) the numerator of
which shall be equal to the Current Market Price on the Record Date less
an amount equal to the quotient of (x) such combined amount and (y) the
number of shares of Common Stock outstanding on the Record Date and (ii)
the denominator of which shall be equal to the Current Market Price on
such date; provided, however, that in the event the portion of the cash
so distributed applicable to one share of Common Stock is equal to or
greater than the Current Market Price of the Common Stock on the Record
Date, in lieu of the foregoing adjustment, adequate provision shall be
made so that each Noteholder shall have the right to receive upon
conversion of a Note (or any portion thereof) the amount of cash such
holder would have received had such holder converted such Note (or
portion thereof) immediately prior to such Record Date. In the event
that such dividend or distribution is not so paid or made, the
Conversion Price shall again be adjusted to be the Conversion Price that
would then be in effect if such dividend or distribution had not been
declared.
(f) For purposes of this Section 15.5, the following terms shall
have the meaning indicated:
(1) "Closing Price" with respect to any securities on
any day shall mean the closing sale price regular way on such
day or, in case no such sale takes place on such day, the
average of the reported closing bid and asked prices, regular
way, in each case on the Nasdaq National Market or New York
Stock Exchange, as applicable, or, if such security is not
listed or admitted to trading on such National Market or
Exchange, on the principal national security exchange or
quotation system on which such security is quoted or listed or
admitted to trading, or, if not quoted or listed or admitted to
trading on any national securities exchange or quotation system,
the average of the closing bid and asked prices of such security
on the over-the-counter market on the day in question as
reported by the National Quotation Bureau Incorporated, or a
similar generally accepted reporting service, or if not so
available, in such manner as furnished by any New York Stock
Exchange member firm selected from time to time by the Board of
Directors for that purpose, or a price determined in good faith
by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution.
(2) "Current Market Price" shall mean the average of the
daily Closing Prices per share of Common Stock for the ten (10)
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 Conversion Price pursuant to Section 15.5(a),
(b), (c), (d), or (e) occurs during such ten (10) consecutive
Trading Days, the Closing Price for each Trading Day prior to
the
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"ex" date for such other event shall be adjusted by multiplying
such Closing Price by the same fraction by which the Conversion
Price is so required to be adjusted as a result of such other
event, (2) if the "ex" date for any event (other than the
issuance or distribution requiring such computation) that
requires an adjustment to the Conversion Price pursuant to
Section 15.5(a), (b), (c), (d) or(e) occurs on or after the "ex"
date for the issuance or distribution requiring such computation
and prior to the day in question, the Closing Price for each
Trading Day on and after the "ex" date for such other event
shall be adjusted by multiplying such Closing Price by the
reciprocal of the fraction by which the Conversion Price is so
required to be adjusted as a result of such other event, and (3)
if the "ex" date for the issuance or distribution requiring such
computation is prior to the day in question, after taking into
account any adjustment required pursuant to clause (1) or (2) of
this proviso, the Closing Price for each Trading Day on or after
such "ex" date shall be adjusted by adding thereto the amount of
any cash and the fair market value (as determined by the Board
of Directors in a manner consistent with any determination of
such value for purposes of Section 15.5(d), whose determination
shall be conclusive and described in a Board Resolution) of the
evidences of indebtedness, shares of capital stock or assets
being distributed applicable to one share of Common Stock as of
the close of business on the day before such "ex" date. For
purposes of this paragraph, the term "ex" date, (1) when used
with respect to any issuance or distribution, means the first
date on which the Common Stock trades regular way on the
relevant exchange or in the relevant market from which the
Closing Price was obtained without the right to receive such
issuance or distribution and (2) when used with respect to any
subdivision or combination of shares of Common Stock, means the
first date on which the Common Stock trades regular way on such
exchange or in such market after the time at which such
subdivision or combination becomes effective. Notwithstanding
the foregoing, whenever successive adjustments to the Conversion
Price are called for pursuant to this Section 15.5, such
adjustments shall be made to the Current Market Price as may be
necessary or appropriate to effectuate the intent of this
Section 15.5 and to avoid unjust or inequitable results as
determined in good faith by the Board of Directors.
(3) "fair market value" shall mean the amount which a
willing buyer would pay a willing seller in an arm's length
transaction.
(4) "Record Date" shall mean, with respect to any
dividend, distribution or other transaction or event in which
the holders of Common Stock have the right to receive any cash,
securities or other property or in which the Common Stock (or
other applicable security) is exchanged for or converted into
any combination of cash, securities or other property, the date
fixed for determination of stockholders entitled to receive such
cash, securities or other property (whether such date is fixed
by the Board of Directors or by statute, contract or otherwise).
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(5) "Trading Day" shall mean (x) if the applicable
security is listed or admitted for trading on the New York Stock
Exchange or another national security exchange, a day on which
the New York Stock Exchange or such other national security
exchange, as applicable, is open for business or (y) if the
applicable security is quoted on the Nasdaq National Market, a
day on which trades may be made thereon or (z) if the applicable
security is not so listed, admitted for trading or quoted, any
day other than a Saturday or Sunday or a day on which banking
institutions in the State of New York are authorized or
obligated by law or executive order to close.
(g) The Company may make such reductions in the Conversion
Price, in addition to those required by Sections 15.5(a), (b), (c), (d)
or (e), as the Board of Directors considers to be advisable to avoid or
diminish any income tax to holders of Common Stock or rights to purchase
Common Stock resulting from any dividend or distribution of stock (or
rights to acquire stock) or from any event treated as such for income
tax purposes.
To the extent permitted by applicable law, the Company from time
to time may reduce the Conversion Price by any amount for any period of
time if the period is at least twenty (20) days, the reduction is
irrevocable during the period and the Board of Directors shall have made
a determination that such reduction would be in the best interests of
the Company, which determination shall be conclusive and described in a
Board Resolution. Whenever the Conversion Price is reduced pursuant to
the preceding sentence, the Company shall mail to the holder of each
Note at his last address appearing on the Note register provided for in
Section 2.5 a notice of the reduction at least fifteen (15) days prior
to the date the reduced Conversion Price takes effect, and such notice
shall state the reduced Conversion Price and the period during which it
will be in effect.
(h) No adjustment in the Conversion Price shall be required
under this Section 15.5 unless such adjustment would require an increase
or decrease of at least 1% in such price; provided, however, that any
adjustments which by reason of this Section 15.5(h) are not required to
be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Article XV shall be
made by the Company and shall be made to the nearest cent or to the
nearest one hundredth of a share, as the case may be. No adjustment need
be made for a change in the par value or no par value of the Common
Stock.
(i) Whenever the Conversion Price is adjusted as provided in
this Section 15.5, the Company shall promptly file with the Trustee and
any conversion agent other than the Trustee an Officer's Certificate
setting forth the Conversion Price after such adjustment and setting
forth a brief statement of the facts requiring such adjustment. Promptly
after delivery of such certificate, the Company shall prepare a notice
of such adjustment of the Conversion Price setting forth the adjusted
Conversion Price and the date on which each adjustment becomes effective
and shall mail such notice of such adjustment of the Conversion Price to
the holder of each Note at his last address appearing on the Note
register provided for in Section 2.5, within twenty (20) days of the
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effective date of such adjustment. Failure to deliver such notice shall
not effect the legality or validity of any such adjustment.
(j) In any case in which this Section 15.5 provides that an
adjustment shall become effective immediately after a Record Date for an
event, the Company may defer until the occurrence of such event (i)
issuing to the holder of any Note converted after such Record Date and
before the occurrence of such event the additional shares of Common
Stock issuable upon such conversion by reason of the adjustment required
by such event over and above the Common Stock issuable upon such
conversion before giving effect to such adjustment and (ii) paying to
such holder any amount in cash in lieu of any fraction pursuant to
Section 15.3.
(k) For purposes of this Section 15.5, the number of shares of
Common Stock at any time outstanding shall not include shares held in
the treasury of the Company but shall include shares issuable in respect
of scrip certificates issued in lieu of fractions of shares of Common
Stock. The Company will not pay any dividend or make any distribution on
shares of Common Stock held in the treasury of the Company.
Section 15.6 One-Time Conversion Price Adjustment
(a) In addition to any adjustments to the Conversion Price
required to be made pursuant to Section 15.5, if 115% of the Average
Market Price on February 21, 2003 (the "Adjustment Date") is less than
the Conversion Price otherwise in effect on the Adjustment Date, the
Conversion Price shall be decreased effective as of the Adjustment Date
to an amount equal to the greater of (x) 115% of such Average Market
Price and (y) 75% of the Conversion Price.
(b) "Average Market Price" shall mean the average of the daily
Closing Prices per share of Common Stock for the twenty (20) consecutive
Trading Days immediately prior to the Adjustment Date; provided,
however, that if the "ex" date (as defined in Section 15.5(f)(2)) for
any event that requires an adjustment to the Conversion Price pursuant
to Section 15.5 occurs during such twenty (20) consecutive Trading Days,
the Closing Price for each Trading Day prior to the "ex" date for such
other event shall be adjusted by multiplying such Closing Price by the
same fraction by which the Conversion Price is so required to be
adjusted as a result of such other event.
(c) If the Conversion Price is adjusted as provided in Section
15.6(a), the Company shall promptly file with the Trustee and any
conversion agent other than the Trustee an Officers' Certificate setting
forth the fact that an adjustment to the Conversion Price was made
pursuant to this Section 15.6 and the Conversion Price after such
adjustment. Promptly after delivery of such certificate, the Company
shall prepare a notice of such adjustment of the Conversion Price
setting forth the adjusted Conversion Price and the date on which such
adjustment became effective and shall mail such notice to the holder of
each Note at his last address appearing on the Note register provided
for in Section 2.5, within twenty (20) days of the Adjustment Date.
Failure to deliver such notice shall not affect the legality or validity
of any such adjustment.
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Section 15.7 Effect of Reclassification, Consolidation, Merger or Sale
Subject to the provisions of Article XVI, if any of the following events
occur, namely (i) any reclassification or change of the outstanding shares of
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), (ii) any consolidation, merger or combination of the Company with
another Person as a result of which holders of Common Stock shall be entitled to
receive stock, securities or other property or assets (including cash) with
respect to or in exchange for such Common Stock (other than as a result of a
change in name, a change in par value or a change in the jurisdiction of
incorporation), (iii) any statutory exchange as a result of which holders of
Common Stock generally shall be entitled to receive stock, securities or other
property or assets (including cash) with respect to or in exchange for such
Common Stock (such transaction, a "Statutory Exchange"), or (iv) any sale or
conveyance of the properties and assets of the Company as, or substantially as,
an entirety to any other Person as a result of which holders of Common Stock
shall be entitled to receive stock, securities or other property or assets
(including cash) with respect to or in exchange for such Common Stock, then the
Company or the successor or purchasing Person, as the case may be, shall execute
with the Trustee a supplemental indenture (which shall comply with the Trust
Indenture Act as in force at the date of execution of such supplemental
indenture if such supplemental indenture is then required to so comply)
providing that such Note shall be convertible into the kind and amount of shares
of stock and other securities or property or assets (including cash) receivable
upon such reclassification, change, consolidation, merger, combination,
Statutory Exchange, sale or conveyance by a holder of a number of shares of
Common Stock issuable upon conversion of such Notes (assuming, for such
purposes, a sufficient number of authorized shares of Common Stock available to
convert all such Notes) immediately prior to such reclassification, change,
consolidation, merger, combination, Statutory Exchange, sale or conveyance
assuming such holder of Common Stock did not exercise his rights of election, if
any, that holders of Common Stock who were entitled to vote or consent to such
transaction had as to the kind or amount of securities, cash or other property
receivable upon such consolidation, merger, combination, Statutory Exchange,
sale or conveyance (provided that, if the kind or amount of securities, cash or
other property receivable upon such consolidation, merger, combination,
Statutory Exchange, sale or conveyance is not the same for each share of Common
Stock in respect of which such rights of election shall not have been exercised
("non-electing share"), then for the purposes of this Section 15.7 the kind and
amount of securities, cash or other property receivable upon such consolidation,
merger, combination, Statutory Exchange, sale or conveyance for each
non-electing share shall be deemed to be the kind and amount so receivable per
share by a plurality of the non-electing shares). Such supplemental indenture
shall provide for adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Article XV. If, in the case
of any such reclassification, change, consolidation, merger, combination,
Statutory Exchange, sale or conveyance, the stock or other securities and assets
receivable thereupon by a holder of shares of Common Stock include shares of
stock or other securities and assets of a Person other than the successor or
purchasing Person, as the case may be, in such reclassification, change,
consolidation, merger, combination, Statutory Exchange, sale or conveyance, then
such supplemental indenture shall also be executed by such other Person and
shall contain such additional provisions to protect the interests of the holders
of the Notes as the Board of Directors shall reasonably consider necessary by
reason of the foregoing, including to
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the extent practicable the provisions providing for the repurchase rights set
forth in Article XVI herein.
The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each holder of Notes, at his address appearing on the
Note register provided for in Section 2.5 of this Indenture, within twenty (20)
days after execution thereof. Failure to deliver such notice shall not affect
the legality or validity of such supplemental indenture.
The above provisions of this Section 15.7 shall similarly apply to
successive reclassifications, changes, consolidations, mergers, combinations,
sales and conveyances.
If this Section 15.7 applies to any event or occurrence, Section 15.5
shall not apply.
Section 15.8 Taxes on Shares Issued
The issue of stock certificates on conversions of Notes shall be made
without charge to the converting Noteholder for any tax in respect of the issue
thereof. The Company shall not, however, be required to pay any tax which may be
payable in respect of any transfer involved in the issue and delivery of stock
in any name other than that of the holder of any Note converted, and the Company
shall not be required to issue or deliver any such stock certificate unless and
until the Person or Persons requesting the issue thereof shall have paid to the
Company the amount of such tax or shall have established to the satisfaction of
the Company that such tax has been paid.
Section 15.9 Reservation of Shares; Shares to be Fully Paid; Listing of
Common Stock
The Company shall provide, free from preemptive rights, out of its
authorized but unissued shares or shares held in treasury, reserved for the
purpose of issuance, no less than one hundred five percent (105%) of the number
of shares of Common Stock needed to provide for the issuance of Common Stock
upon conversion of all of the Notes and upon exercise of all the Warrants
without regard to any limitations on conversions or exercise.
The Company will not, by amendment of its certificate of incorporation
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities, or any other voluntary action, avoid
or seek to avoid the observance or performance of any of the terms to be
observed or performed by it hereunder. Without limiting the generality of the
foregoing, the Company (i) will not increase the par value of any shares of
Common Stock issuable upon conversion of the Notes above the Conversion Price
then in effect, (ii) will take all such actions as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and non-assessable shares of Common Stock upon conversion of the Notes and (iii)
will not take any action which results in any adjustment of the Conversion Price
if the total number of shares of Common Stock issuable after the conversion of
all of the Notes and exercise of all of the Warrants would exceed the total
number of shares of Common Stock then authorized by the Company's certificate of
incorporation and available for the purpose of issue upon such exercise.
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The Company covenants that all shares of Common Stock issued upon
conversion of Notes will be fully paid and non-assessable by the Company and
free from all taxes, liens and charges with respect to the issue thereof.
The Company is obligated to register the shares of Common Stock issuable
upon conversion of the Notes for resale under the Securities Act pursuant to the
Registration Rights Agreement. The shares of Common Stock issuable upon
conversion of the Notes shall constitute Registrable Securities (as such term is
defined in the Registration Rights Agreement). Each holder of Notes shall be
entitled to all of the benefits afforded to a holder of any such Registrable
Securities under the Registration Rights Agreement and such holder, by its
acceptance of a Note, agrees and shall agree to be bound by and to comply with
the terms and conditions of the Registration Rights Agreement applicable to such
holder as a holder of such Registrable Securities.
The Company shall use commercially reasonable efforts to promptly secure
the listing of the shares of Common Stock issuable upon conversion of a Note
upon each national securities exchange and automated quotation system, if any,
upon which shares of Common Stock are then listed (subject to official notice of
issuance upon conversion of such Note) and shall use commercially reasonable
efforts to maintain, so long as any other shares of Common Stock shall be so
listed, such listing of all shares of Common Stock from time to time issuable
upon the conversion of all then outstanding Notes; and the Company shall use
commercially reasonable efforts to list on each national securities exchange or
automated quotation system, as the case may be, and shall maintain such listing
of, any other shares of capital stock of the Company issuable upon conversion of
the Notes if and so long as any shares of the same class shall be listed on such
national securities exchange or automated quotation system. The Company shall
pay all fees and expenses in connection with satisfying its obligations under
this Section 15.9.
Except as otherwise specifically provided herein, prior to a
Noteholder's receipt of Common Stock upon conversion of a Note, the Noteholder
shall not be entitled, as such, to any rights of a stockholder of the Company,
including, without limitation, the right to vote or to consent to any action of
the stockholders of the Company, to receive dividends or other distributions, to
exercise any preemptive right or to receive dividends or other distributions, or
to receive any notice of meetings of stockholders of the Company, and shall not
be entitled to receive any notice of any proceedings of the Company. In
addition, nothing contained in this Indenture shall be construed as imposing any
liabilities on such holder to purchase any securities (upon conversion of a Note
or otherwise) or as a stockholder of the Company, whether such liabilities are
asserted by the Company or by creditors of the Company.
Section 15.10 Responsibility of Trustee
The Trustee and any other conversion agent shall not at any time be
under any duty or responsibility to any holder of Notes to determine whether any
facts exist which may require any adjustment of the Conversion Price, or with
respect to the nature or extent or calculation of any such adjustment when made,
or with respect to the method employed, or herein or in any supplemental
indenture provided to be employed, in making the same. The Trustee and any other
conversion agent shall not be accountable with respect to the validity or value
(or the kind
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or amount) of any shares of Common Stock, or of any securities or property,
which may at any time be issued or delivered upon the conversion of any Note;
and the Trustee and any other conversion agent make no representations with
respect thereto. Subject to the provisions of Section 8.1, neither the Trustee
nor any conversion agent shall be responsible for any failure of the Company to
issue, transfer or deliver any shares of Common Stock or stock certificates or
other securities or property or cash upon the surrender of any Note for the
purpose of conversion or to comply with any of the duties, responsibilities or
covenants of the Company contained in this Article. Without limiting the
generality of the foregoing, neither the Trustee nor any conversion agent shall
be under any responsibility to determine whether a supplemental indenture need
be entered into under Section 15.7 or the correctness of any provisions
contained in any supplemental indenture entered into pursuant to such section
relating either to the kind or amount of shares of stock or securities or
property (including cash) receivable by Noteholders upon the conversion of their
Notes after any event referred to in such Section 15.7 or to any adjustment to
be made with respect thereto, but, subject to the provisions of Section 8.1, may
accept as conclusive evidence of the correctness of any such provisions, and
shall be protected in relying upon, the Officer's Certificate (which the Company
shall be obligated to file with the Trustee prior to the execution of any such
supplemental indenture) with respect thereto.
Section 15.11 Notice to Holders Prior to Certain Actions
In case:
(a) the Company shall declare a dividend (or any other
distribution) on its Common Stock; or
(b) the Company shall authorize the granting to the holders of
its Common Stock of rights or warrants to subscribe for or purchase any
share of any class or any other rights or warrants; or
(c) of any reclassification of the Common Stock of the Company
(other than a subdivision or combination of its outstanding Common
Stock, or a change in par value, or from par value to no par value, or
from no par value to par value), 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;
the Company shall cause to be filed with the Trustee and to be mailed to each
holder of Notes at his address appearing on the Note register, provided for in
Section 2.5 of this Indenture, as promptly as possible but in any event at least
fifteen (15) days prior to the applicable 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 rights or warrants, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution or rights are to be determined, or (y) the date
on which such reclassification, consolidation, merger,
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sale, transfer, dissolution, liquidation or winding-up is expected to become
effective or occur, and the date as of which it is expected that holders of
Common Stock of record shall be entitled to exchange their Common Stock for
securities or other property deliverable upon such reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.
The Company shall also issue a press release in connection with any such event,
and shall use commercially reasonable efforts to have such press release
available on Bloomberg Business News. Failure to give such notice, or any defect
therein, shall not affect the legality or validity of such dividend,
distribution, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up.
Section 15.12 Company Right to Force Automatic Conversion.
The Company may, at its option, automatically convert all of the Notes
(an "Automatic Conversion") at any time prior to June 21, 2005 if no Event of
Default has occurred and is continuing and the Closing Price per share of the
Common Stock has exceeded 150% of the Conversion Price then in effect for at
least fifteen (15) Trading Days within a period of twenty (20) consecutive
Trading Days ending five (5) Trading Days prior to the Automatic Conversion
Date, provided (i) that a registration statement covering the resale of the
Common Stock issuable upon such conversion (the "Conversion Shares") is
effective and available for resale of the Notes and the Common Stock issuable
upon conversion of Notes from the twenty-fifth (25th) Trading Date prior to the
Automatic Conversion Date to and including the Automatic Conversion Date to the
extent required under the Registration Rights Agreement and (ii) the Conversion
Shares are listed for trading on the Principal Market (as defined in the
Securities Purchase Agreement). If the Company exercises the right of conversion
set forth in this Section 15.12, the Company shall make an additional payment in
cash to each holder of Notes with respect to the Notes converted, in an amount
(the "Company Conversion Provisional Payment") equal to $157.50 per each $1,000
principal amount of the Note, less the amount of any interest actually paid on
such Note to the Conversion Date (and, if such Note is converted between a
record date and the next interest payment date, less interest payable on each
$1,000 principal amount of such Note on such interest payment date).
Unless the Company shall have theretofore called for redemption all of
the Notes then outstanding, the Company shall give to all Noteholders by
mailing, first class postage prepaid, a notice (the "Automatic Conversion
Notice") of the Automatic Conversion not more than thirty (30) days and not less
than five (5) days before the Automatic Conversion Date to such Noteholders at
their last addresses as they shall appear upon the Notes register. Any notice
that is mailed in the manner herein provided shall be conclusively presumed to
have been duly given, whether or not the registered Noteholder receives the
notice. The Company shall also issue a press release regarding its election to
convert the Notes, and shall use commercially reasonable efforts to have such
press release available on Bloomberg Business News. In any case, failure to duly
give such notice to the holder of any Notes designated for redemption in whole
or in part, or any defect in the notice, shall not affect the validity of the
proceedings for the automatic conversion of any other Notes.
Each Automatic Conversion Notice shall state:
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(a) the Automatic Conversion Date,
(b) the CUSIP number(s) of the Note(s) to be automatically
converted,
(c) the place or places where such Notes are to be surrendered
for conversion,
(d) the Conversion Price then in effect, and
(e) what portion (if any) of any Company Conversion Provisional
Payment will be paid in Common Stock.
If any of the foregoing provisions or other provisions of this Section
are inconsistent with applicable law, such law shall govern.
In the event of an Automatic Conversion, the Company shall issue and
deliver a certificate or certificates for the number of full shares of Common
Stock issuable upon conversion of the Notes along with (a) any cash in respect
of any fractional shares of Common Stock otherwise issuable upon conversion and
(b) the Company Conversion Provisional Payment, if any, for payment to the
Noteholder as promptly after the Automatic Conversion Date as practicable in
accordance with the provisions of this Article XV.
All Notes subject to the Automatic Conversion shall be delivered to the
Company to be canceled.
ARTICLE XVI
REPURCHASE UPON A REPURCHASE EVENT
Section 16.1 Repurchase Right
If, at any time prior to June 15, 2007 there shall occur a Repurchase
Event, then each Noteholder 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 thirty (30) calendar days after the date of
the Company Notice (as defined in Section 16.2 below) of such Repurchase Event
(or, if such 30th day is not a Business Day, the next succeeding Business Day).
Such repurchase shall be made in cash at a price equal to 105% of the principal
amount of Notes such holder elects to require the Company to repurchase,
together with accrued interest, if any, to the repurchase date (the "Repurchase
Price"); provided, however, that if such repurchase date is June 15 or December
15 then the interest payable on such date shall be paid to the holder of record
of the Note on the next preceding June 1 or December 1, respectively.
Notwithstanding anything in this Article XVI to the contrary, if a redemption
date pursuant to Article III shall occur prior to any repurchase date
established pursuant to a Company Notice under Section 16.2, provided that the
Company shall have deposited or set aside an amount of money sufficient to
redeem such Notes as set forth in Section 3.2 on or before such repurchase date,
all such Notes shall be redeemed pursuant to Article III and the repurchase
rights hereunder shall have no effect.
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Section 16.2 Notices; Method of Exercising Repurchase Right, Etc.
(a) Unless the Company shall have theretofore called for
redemption all of the outstanding Notes and deposited or set aside an
amount of money sufficient to redeem such Notes on the redemption date
as set forth in Section 3.2, on or before the fifth (5th) Business Day
following the occurrence of a Repurchase Event, the Company or, at the
written request of the Company, the Trustee, shall mail to all holders
of record of the Notes a notice (the "Company Notice") in the form as
prepared by the Company of the occurrence of the Repurchase Event and of
the repurchase right set forth herein arising as a result thereof. The
Company shall issue a press release with respect to such Repurchase
Event, and shall use commercially reasonable efforts to have such press
release available on Bloomberg Business News. The Company shall also
deliver a copy of such notice of a repurchase right to the Trustee and
cause a copy of such notice of a repurchase right, or a summary of the
information contained therein, to be published once in a newspaper of
general circulation in The City of New York. The Company Notice shall
contain the following information:
(1) the repurchase date;
(2) the CUSIP number(s) of the Note(s) subject to the
repurchase right;
(3) the date by which the repurchase right must be
exercised;
(4) the last date by which the election to require
repurchase, if submitted, must be revoked;
(5) the Repurchase Price;
(6) a description of the procedure which a holder must
follow to exercise a repurchase right; and
(7) the Conversion Price then in effect, the date on
which the right to convert the principal amount of the Notes to
be repurchased will terminate and the place or places where
Notes may be surrendered for conversion.
No failure of the Company to give the foregoing notices or defect
therein shall limit any holder's right to exercise a repurchase right or affect
the validity of the proceedings for the repurchase of Notes.
If any of the foregoing provisions are inconsistent with applicable law,
such law shall govern.
(b) To exercise a repurchase right, a holder shall deliver to
the Trustee on or before the close of business on the thirty-fifth
(35th) day after the Company Notice was mailed (i) written notice to the
Company (or agent designated by the Company for such purpose) of the
holder's exercise of such right, which notice shall set forth the name
of
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the holder, the principal amount of the Notes to be repurchased, a
statement that an election to exercise the repurchase right is being
made thereby, and (ii) the Notes with respect to which the repurchase
right is being exercised, duly endorsed for transfer to the Company.
Election of repurchase by a holder shall be revocable at any time prior
to, but excluding, the repurchase date, by delivering written notice to
that effect to the Trustee prior to the close of business on the
Business Day prior to the repurchase date.
(c) If the Company fails to repurchase on the repurchase date
any Notes (or portions thereof) as to which the repurchase right has
been properly exercised, then the principal of such Notes shall, until
paid, bear interest to the extent permitted by applicable law from the
repurchase date at the rate borne by the Note and each such Note shall
be convertible into Common Stock in accordance with this Indenture
(without giving effect to Section 16.2(b)) until the principal of such
Note shall have been paid or duly provided for.
(d) Any Note that is to be repurchased only in part shall be
surrendered to the Trustee duly endorsed for transfer to the Company and
accompanied by appropriate evidence of genuineness and authority
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,
containing identical terms and conditions, of any authorized
denomination as requested by such holder in aggregate principal amount
equal to and in exchange for the unrepurchased portion of the principal
of the Note so surrendered.
(e) On or prior to 10:00 a.m., New York City time on the
repurchase 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 5.4) the Repurchase
Price in cash for payment to the holder on the repurchase date.
(f) If the Company is unable to repurchase on the repurchase
date all of the Notes (or portions thereof) as to which the repurchase
right has been properly exercised, the aggregate amount of Notes the
Company may repurchase shall be allocated pro rata among each Note (or
portion thereof) surrendered for repurchase, based on the principal
amount of such Note, in proportion to the aggregate amount of Notes
surrendered for repurchase.
(g) All Notes delivered for repurchase shall be delivered to the
Trustee to be canceled in accordance with the provisions of Section 2.8.
Section 16.3 Certain Definitions
For purposes of this Article XVI:
(a) The term "beneficial owner" shall be determined in
accordance with Rule 13d-3 and 13d-5, as in effect on the date of the
original execution of this Indenture, promulgated by the Commission
pursuant to the Exchange Act.
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(b) The term "person" or "group" shall include any syndicate or
group which would be deemed to be a "person" under Section 13(d) and
14(d) of the Exchange Act as in effect on the date of the original
execution of this Indenture.
(c) The term "Continuing Director" means at any date a member of
the Company's Board of Directors (i) who was a member of such board on
June 21, 2002 or (ii) who was nominated or elected by at least a
majority of the directors who were Continuing Directors at the time of
such nomination or election or whose election to the Company's Board of
Directors was recommended or endorsed by at least a majority of the
directors who were Continuing Directors at the time of such nomination
or election or such lesser number comprising a majority of a nominating
committee if authority for such nominations or elections has been
delegated to a nominating committee whose authority and composition have
been approved by at least a majority of the directors who were
Continuing Directors at the time such committee was formed. (Under this
definition, if the Board of Directors of the Company as of the date of
this Indenture were to approve a new director or directors and then
resign, no Change in Control would occur even though all of the current
members of the Board of Directors would thereafter cease to be in
office).
(d) The term "Repurchase Event" means a Change in Control or a
Termination of Trading.
(e) A "Change in Control" shall be deemed to have occurred when
(i) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act) is or becomes the beneficial owner of
shares representing more than 50% of the combined voting power of the
then outstanding securities entitled to vote generally in elections of
directors of the Company (the "Voting Stock"); (ii) approval by the
stockholders of the Company of any plan or proposal for the liquidation,
dissolution or winding up of the Company; (iii) the Company (A)
consolidates with or merges into any other corporation or any other
corporation merges into the Company, and in the case of any such
transaction, the outstanding Common Stock of the Company is changed or
exchanged into other assets or securities as a result, unless the
stockholders of the Company immediately before such transaction own,
directly or indirectly immediately following such transaction, at least
51% of the combined voting power of the outstanding voting securities of
the corporation resulting from such transaction in substantially the
same proportion as their ownership of the Voting Stock immediately
before such transaction, or (B) conveys, transfers or leases all or
substantially all of its assets to any Person (other than a wholly-owned
subsidiary as a result of which the Company becomes a holding company);
or (iv) any time Continuing Directors do not constitute a majority of
the Board of Directors of the Company (or, if applicable, a successor
corporation to the Company). Notwithstanding the foregoing, a Change in
Control will not be deemed to have occurred if the average Closing Price
of the Common Stock for the ten (10) Trading Days immediately preceding
the Change in Control is at least equal to 110% of the Conversion Price
in effect on such Trading Day.
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(f) A "Termination of Trading" shall have occurred if the Common
Stock (or other common stock into which the Notes are then convertible)
is neither listed for trading on a United States national securities
exchange nor approved for trading on an established automated
over-the-counter trading market in the United States.
ARTICLE XVII
MISCELLANEOUS PROVISIONS
Section 17.1 Provisions Binding on Company's Successors
All the covenants, stipulations, promises and agreements of the Company
contained in this Indenture shall bind its successors and assigns whether so
expressed or not.
Section 17.2 Official Acts by Successor Corporation
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
like board, committee or officer of any corporation that shall at the time be
the lawful sole successor of the Company.
Section 17.3 Addresses for Notices, Etc.
Any notice or demand which by any provision of this Indenture is
required or permitted to be given or served by the Trustee or by the holders of
Notes on the Company and any notice, direction, request or demand hereunder to
or upon the Trustee or to or upon any Noteholder shall be deemed to have been
sufficiently given or made, for all purposes (i) upon receipt, when delivered
personally; (ii) upon receipt, when sent by facsimile; or (iii) one (1) Business
Day after deposit with a nationally recognized overnight delivery service, in
each case properly addressed to the party to receive the same. The addresses and
facsimile numbers of such communications shall be:
If to the Company:
Electroglas, Inc.
0000 Xxxxxx Xxxxx Xxxxxx Xxxx
Xxx Xxxx, Xxxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxxx Xxxxxxx
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If to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Corporate Trust Administration
If to a Noteholder:
At his address as it appears on the Note
register, which shall initially include the
information set forth in the Securities
Purchase Agreement regarding notices
The Trustee, by notice to the Company, may designate additional or
different addresses for subsequent notices or communications. The Trustee shall
use reasonable commercial efforts to provide any notice of default, notice of
redemption and notice of conversion to each holder by facsimile, if and to the
extent such holder's facsimile number is set forth in the Note register.
Failure to give a notice or communication to a Noteholder or any defect
in it shall not affect its sufficiency with respect to other Noteholders. If a
notice or communication is given or made in the manner provided above, it is
duly given or made, whether or not the addressee receives it.
Section 17.4 Governing Law
This Indenture and each Note shall be deemed to be a contract made under
the laws of New York, and for all purposes shall be governed by and construed in
accordance with the laws of New York, including, without limitation, Section
5-1401 of the New York General Obligations Law.
Section 17.5 Evidence of Compliance with Conditions Precedent;
Certificates to Trustee
Upon any application or demand by the Company to the Trustee to take any
action under any of the provisions of this Indenture, the Company shall furnish
to the Trustee an Officer's Certificate stating that in the opinion of the
person executing such Officer's Certificate all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
satisfied, and an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been satisfied.
Each certificate or opinion provided for by or on behalf of the Company
in this Indenture and delivered to the Trustee with respect to compliance with a
condition or covenant provided for in this Indenture shall include (1) a
statement that the person making such certificate or opinion has read such
covenant or condition; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statement or opinion contained in
such
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certificate or opinion is based; (3) a statement that, in the opinion of such
person, he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant or
condition has been complied with; and (4) a statement as to whether or not, in
the opinion of such person, such condition or covenant has been satisfied or
waived.
Section 17.6 Legal Holidays
In any case where the date of maturity of interest on or principal of
the Notes or the date fixed for redemption of any Note will not be a Business
Day, then payment of such interest on or principal of the Notes need not be made
on such date, but may be made on the next succeeding Business Day with the same
force and effect as if made on the date of maturity or the date fixed for
redemption, and no interest shall accrue for the period from and after such
date.
Section 17.7 No Security Interest Created
Nothing in this Indenture or in the Notes, expressed or implied, shall
be construed to constitute a security interest under the Uniform Commercial Code
or similar legislation, as now or hereafter enacted and in effect, in any
jurisdiction.
Section 17.8 Trust Indenture Act
This Indenture is hereby made subject to, and shall be governed by, the
provisions of the Trust Indenture Act required to be part of and to govern
indentures qualified under the Trust Indenture Act; provided, however, that this
Section 17.8 shall not require that this Indenture or the Trustee be qualified
under the Trust Indenture Act prior to the time such qualification is in fact
required under the terms of the Trust Indenture Act, nor shall it constitute any
admission or acknowledgment by any party hereto that any such qualification is
required prior to the time such qualification is in fact required under the
terms of the Trust Indenture Act. If any provision hereof limits, qualifies or
conflicts with another provision hereof that is required to be included in an
indenture qualified under the Trust Indenture Act, such required provision shall
control.
Section 17.9 Benefits of Indenture
Nothing in this Indenture or in the Notes, expressed or implied, shall
give to any Person, other than the parties hereto, any paying agent, any
authenticating agent, any Note registrar and their successors hereunder, the
holders of Notes and the holders of Senior Indebtedness, any benefit or any
legal or equitable right, remedy or claim under this Indenture.
Section 17.10 Table of Contents, Headings, Etc.
The table of contents and the titles and headings of the articles and
sections of this Indenture have been inserted for convenience of reference only,
are not to be considered a part hereof, and shall in no way modify or restrict
any of the terms or provisions hereof.
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Section 17.11 Authenticating Agent
The Trustee may appoint an authenticating agent which shall be
authorized to act on its behalf and subject to its direction in the
authentication and delivery of Notes in connection with the original issuance
thereof and transfers and exchanges of Notes hereunder, including under Sections
2.4, 2.5, 2.6, 2.7 and 3.3, as fully for all intents and purposes as though the
authenticating agent had been expressly authorized by this Indenture and those
Sections to authenticate and deliver Notes. For all purposes of this Indenture,
the authentication and delivery of Notes by the authenticating agent shall be
deemed to be authentication and delivery of such Notes "by the Trustee" and a
certificate of authentication executed on behalf of the Trustee by an
authenticating agent shall be deemed to satisfy any requirement hereunder or in
the Notes for the Trustee's certificate of authentication. Such authenticating
agent shall at all times be a Person eligible to serve as trustee hereunder
pursuant to Section 8.9.
Any corporation into which any authenticating agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any authenticating agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of any authenticating agent, shall be the successor
of the authenticating agent hereunder, if such successor corporation is
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the parties hereto or the authenticating
agent or such successor corporation.
Any authenticating agent may at any time resign by giving written notice
of resignation to the Trustee and to the Company. The Trustee may at any time
terminate the agency of any authenticating agent by giving written notice of
termination to such authenticating agent and to the Company. Upon receiving such
a notice of resignation or upon such a termination, or in case at any time any
authenticating agent shall cease to be eligible under this Section, the Trustee
shall promptly appoint a successor authenticating agent (which may be the
Trustee), shall give written notice of such appointment to the Company and shall
mail notice of such appointment to all holders of Notes as the names and
addresses of such holders appear on the Note register.
The Company agrees to pay to the authenticating agent from time to time
reasonable compensation for its services.
The provisions of Sections 8.2, 8.3, 8.4, 9.3 and this Section 17.11
shall be applicable to any authenticating agent.
Section 17.12 Execution in Counterparts
This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one and the same instrument.
Section 17.13 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any Subsidiary of the Company. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
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The Bank of New York hereby accepts the trusts in this Indenture
declared and provided, upon the terms and conditions hereinabove set forth.
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IN WITNESS WHEREOF, all of the parties hereto have caused this Indenture
to be duly signed as of the date first written above.
ELECTROGLAS, INC.
By:
--------------------------------------
Name:
Title:
Attest:
--------------------------------------
Name:
Title:
THE BANK OF NEW YORK
-----------------------------------------
as Trustee
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO INDENTURE]
