Exhibit 4.2
THIS SECURITY AND THE COMMON STOCK ISSUABLE UPON ITS CONVERSION HAVE NOT BEEN
REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT
PURSUANT TO AN AVAILABLE EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
AND IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS.
ARTESYN TECHNOLOGIES, INC.
3.0% CONVERTIBLE NOTE
DUE JANUARY 15, 2007
No. A-1 $50,000,000
Artesyn Technologies, Inc., a Florida corporation (the "Company"), for
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value received, hereby promises to pay to Finestar International Limited, a
British Virgin Islands corporation, or registered assigns, the principal sum of
Fifty Million Dollars ($50,000,000) on January 15, 2007 (the "Maturity Date")
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and to pay interest thereon, from January 15, 2002 (the "Original Issue Date"),
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or from the most recent interest payment date to which interest has been paid,
semi-annually on January 15 and June 15 in each year, commencing June 15, 2002,
at the rate of 3.0% per annum until the principal hereof has been paid in full.
The Company shall pay interest due on each interest payment date in cash. The
interest so payable shall be paid to the Person in whose name this Security (as
defined below) is registered at 5:00 p.m., New York City time, on the regular
record date for such interest, which shall be the date two business days
immediately prior to the interest payment date. Notwithstanding the foregoing
or anything to the contrary contained herein, all payments of interest hereunder
shall be net of applicable withholding tax. Payment of the principal of (and
premium, if any, on) this Security shall be made upon the surrender of this
Security to the Company, at its chief executive office (or such other office
within the United States as shall be designated by the Company to the holder
hereof) (the "Designated Office"), in such coin or currency of the United States
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of America as at the time of payment shall be legal tender for the payment of
public and private debts. Payment of interest in cash and all other amounts
payable in cash with respect to this Security shall be made by wire transfer to
the holder, provided that if the holder shall not have furnished wire
instructions in writing to the Company no later than the business day
immediately prior to the date on which the Company makes such payment, such
payment may be made by U.S. dollar check mailed to the address of the Person
entitled thereto as such address shall appear in the Company security register.
Whenever there is a reference in this Security, in any context, to the payment
of the interest on this Security, such reference shall be deemed to include
reference to the payment of the Non-Exclusive Remedy payable as described in the
Registration Rights Agreement to the extent that, in such context, the Non-
Exclusive Remedy is, was or would be payable in respect of this Security, and
express reference of payment of the Non-Exclusive Remedy (if applicable) in any
provision of this Security shall not be construed as excluding the Non-Exclusive
Remedy in those provisions of this Security where such express reference is not
made. Capitalized terms used and not otherwise defined herein, shall have the
respective meanings given to those terms in Section 8 hereof.
1. Redemption. This Security is subject to redemption, as a whole or
from time to time in part (in any amount not less than $1,000,000), upon not
less than 30 (or, if impracticable, such lesser period as may be practicable
under the circumstances, but in no event less than 15 days) nor more than 60
days' notice in the manner provided in Section 9(b) (provided that any
conditions set forth below in this Section 1 are satisfied), at the election of
the Company, at a redemption price of 100% of the principal amount thereof,
together with accrued and unpaid interest to the redemption date (the
"Redemption Date") plus any remaining interest that would have been payable had
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this Security remained outstanding until the Maturity Date, such redemption
price to be payable in cash only; provided, however, that the Company may not
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redeem this Security prior to January 15, 2005 and thereafter unless (and the
Company may not deliver a notice of redemption unless) (A) (i) a shelf
registration statement with respect to the resale by the holders of the Common
Stock issuable upon conversion of this Security has been declared effective
under the Securities Act by the Commission in accordance with the Registration
Rights Agreement, (ii) such shelf registration statement is effective and the
use of it has not been suspended on the date notice of redemption is given and
(iii) the Company expects such registration to remain effective and the use of
the registration statement not to be suspended through the Redemption Date and
for the 45 days following the Redemption Date or (B) the shares of Common Stock
issuable upon conversion of this Security are freely tradable under Rule 144(k)
promulgated under the Securities Act.
2. Conversion.
(a) Right to Convert.
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(1) The holder of this Security is entitled at any time and
from time to time before the close of business on the Maturity Date (or, in case
this Security is called for redemption or the holder hereof has exercised its
right to require the Company to repurchase this Security or a portion hereof
pursuant to Section 3 hereof, then in respect of this Security or such portion
hereof, as the case may be, until and including, but (unless the Company
defaults in making the payment due upon redemption or repurchase) not after,
12:00 p.m., New York City time, on the Redemption Date or the Repurchase Date,
as the case may be), to convert all or any portion of the principal amount of
this Security (in an amount no less than $1,000,000) into that number of fully
paid and nonassessable shares of Common Stock of the Company equal to (i) the
amount of principal to be so converted divided by (ii) $11.00 (or such price as
adjusted if an adjustment has been made as provided below in this Section 2, the
"Conversion Price"), by surrender of this Security, duly endorsed or assigned to
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the Company or in blank to the Company at the Designated Office, accompanied by
written notice to the Company (the "Conversion Notice") that the holder hereof
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irrevocably elects to convert this Security (or if less than the entire
principal amount hereof is to be converted, specifying the portion hereof to be
converted). Notwithstanding the foregoing, unless the holder of this Security
notifies the Company to the contrary, such holder shall be deemed for all
purposes to have converted this Security, subject only to surrender of this
Security against delivery of the Common Stock and cash payable for fractional
shares issuable upon such conversion (which surrender may take place before or
after the date of such deemed conversion, without affecting the validity
thereof), (A) immediately prior to the close of business on the Redemption Date,
if this Security is redeemed pursuant to Section 1 hereof, or (B) immediately
prior to the close of business on the Maturity Date, in each case, if the
Closing Price of the Common Stock on the immediately preceding Trading Day
exceeds 115% of the Conversion Price.
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(2) Within 30 days after surrender of this Security for
conversion, the holder will be entitled to payment in cash of the interest
accruing on the principal amount of this Security then being converted and
unpaid to such date of conversion.
(3) Subject to the adjustments to the Conversion Price as
provided in this Section 2, no payment or adjustment is to be made on conversion
for dividends on the Common Stock issued on conversion hereof.
(4) Notwithstanding any other provision of this Security, the
Company shall, if the holder so elects, deliver the Common Stock issuable upon
conversion of this Security to any third party designated by the holder.
(5) If any of the foregoing provisions of this Section 2(a) are
inconsistent with applicable law, such law shall govern.
(6) Notwithstanding anything to the contrary stated herein, if
an event occurs or circumstances exist that, assuming issuance of the full
number of shares of Common Stock issuable upon conversion of this Security (in
whole or in part) in accordance with this Section 2, would result in a violation
of Nasdaq Marketplace Rule 4350 (or any similar applicable rule), then upon
receipt of a Conversion Notice, the Company shall:
(i) promptly issue the maximum number of shares of Common
Stock allowable without resulting in such violation;
(ii) promptly take all action necessary in accordance with
applicable law and the Company's certificate of incorporation and bylaws to hold
and convene a meeting of the Company's shareholders (but not later than 45 days
after the date of receipt of the Conversion Notice) and the Company and its
Board of Directors shall not postpone or adjourn such meeting, and the Company
and its Board of Directors shall take all other actions necessary or advisable,
to secure the vote or consent of the shareholders to approve the issuance in
full of the shares of Common Stock issuable upon conversion of this Security;
(iii) if necessary shareholder approval or consent has been
received, promptly issue the remaining shares issuable under the Conversion
Notice (the "NASD Excess Shares"); and
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(iv) if necessary shareholder approval or consent has not
been received and the meeting described in subparagraph (ii) above has been
convened, promptly pay to the holder in cash the amount equal to (A) the NASD
Excess Shares multiplied by (B) the Current Market Price per share of Common
Stock on the date of receipt of the Conversion Notice.
(7) Notwithstanding anything to the contrary contained herein,
if issuance of the full number of shares of Common Stock issuable upon
conversion of this Security (in whole or in part) in accordance with this
Section 2 would require the Company and the holder to each make an HSR Filing
and file related material with the FTC and DOJ under the HSR Act, the Company
shall, upon receipt of the Conversion Notice:
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(i) promptly issue the maximum number of shares of Common
Stock allowable without making such HSR Filing as represented by a stock
certificate or certificates bearing a customary Securities Act legend;
(ii) promptly issue the remainder of the shares issuable
pursuant to such Conversion Notice (the "HSR Excess Shares") as represented by a
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stock certificate or certificates bearing both a customary Securities Act legend
and the following legend (the "Non-Voting Legend"):
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"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE NOT ENTITLED
TO VOTE IN ELECTIONS FOR DIRECTORS OF ARTESYN TECHNOLOGIES,
INC."
(iii) promptly cooperate with the holder in good faith to
submit such HSR Filing; provided, however, that the Company shall not seek early
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termination of any waiting period under the HSR Act without the prior written
consent of the holder; provided, further, that if the holder so requests, the
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Company and the holder shall each use all reasonable efforts to obtain early
termination of such waiting period, and shall in any case promptly supply the
other with any information which may be required in order to effectuate such
filings and supply any additional information which may be reasonably required
by the FTC or DOJ;
(iv) remove the Non-Voting Legend from stock certificates
representing such number of HSR Excess Shares as the holder may request from
time to time (including with respect to transfers other than to a member of the
Purchaser Group); provided, however, that the removal of the Non-Voting Legend
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from such stock certificates representing HSR Excess Shares would not require
the Company and the Holder to each make an HSR Filing; and
(v) if the Company or the holder does not receive an
approval notice from the DOJ or the FTC pursuant to the HSR Filing submitted
pursuant to subparagraph (iii) above within 45 days after filing, promptly pay
to the holder, at the holder's request, in cash the amount equal to (A) the HSR
Excess Shares multiplied by (B) the Current Market Price per share of Common
Stock on the date of receipt of the Conversion Notice; provided, however, that
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if at any time any portion of this Security would be accounted for as a
derivative classified outside of shareholders' equity under GAAP as a result of
this subparagraph (v), then the holder shall not have any rights under this
subparagraph (v).
The holder of this Security acknowledges and agrees that
shares represented by stock certificates bearing the Non-Voting Legend shall not
be entitled to vote in elections for directors of the Company.
(b) Adjustments to Conversion Price for Certain Dilutive Issuances.
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(1) In the event that the Company shall issue, from time to
time, Additional Shares of Common Stock (including Additional Shares of Common
Stock deemed to be issued pursuant to Section 2(b)(3)) without consideration or
for a consideration per share less than the Conversion Price in effect on the
date of and immediately prior to such issue:
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(i) after the Original Issue Date and on or before June 15,
2002, then and in such event, the Conversion Price in effect on the date of and
immediately prior to such issue shall be decreased, concurrently with such
issue, to a price equal to (A) the aggregate consideration received by the
Company for the Additional Shares of Common Stock, divided by (B) the total
number of Additional Shares of Common Stock so issued; or
(ii) after June 15, 2002, then and in such event, the Conversion
Price in effect on the date of and immediately prior to such issue shall be
decreased, concurrently with such issue, by multiplying such Conversion Price by
a fraction:
(A) the numerator of which shall be (1) the number of
shares of Common Stock outstanding immediately prior to such issue plus (2) the
number of shares of Common Stock which the aggregate consideration received by
the Company for the total number of Additional Shares of Common Stock so issued
would purchase at such Conversion Price, and
(B) the denominator of which shall be (1) the number of
shares of Common Stock outstanding immediately prior to such issue plus (2) the
number of Additional Shares of Common Stock so issued.
(2) Special Definitions. For purposes of this Section 2, the
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following definitions apply:
(i) "Additional Shares of Common Stock" shall mean all shares of
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Common Stock issued (or, pursuant to Section 2(b)(3), deemed to be issued) by
the Company after the Original Issue Date, other than:
(A) this Security or a new Security or Securities issued in
replacement thereof, or shares of Common Stock issued or issuable upon
conversion thereof;
(B) Warrants issued concurrently with this Security, or
shares of Common Stock issued or issuable upon exercise thereof;
(C) shares of Common Stock issued or issuable upon
conversion of Options (net of repurchases, expirations, cancellations and
terminations) (and including options outstanding as of the Original Issue Date)
and any additional shares issued or issuable pursuant to stock option or stock
purchase agreements approved by a majority of the Board of Directors or any
committee thereof, in all cases issued to officers, directors or employees of,
or consultants to, the Company under stock option or stock purchase plans that
have been approved by the shareholders of the Company;
(D) shares of Common Stock issued or issuable upon
conversion or exercise of convertible or exercisable securities in existence on
the date hereof that have not yet been converted or exercised as of the date
hereof;
(E) shares of Common Stock for which adjustment to the
Conversion Price is made pursuant to Sections 2(c), (d), (e), (f) or (g);
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(F) the grant, sale or issuance of Options, Convertible
Securities and or Common Stock pursuant to the Rights Agreement;
(G) the issuance of shares of Common Stock (or Options) or
Convertible Securities in connection with acquisitions and commercial
relationships (provided, however, that a purpose of such transactions is not
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capital raising);
(H) the issuance of shares of Common Stock in satisfaction
of any earn-out or contingent payment obligation of the Company arising out of
acquisitions consummated before the Original Issue Date (or Options issued in
consideration for any forbearance thereof); and
(I) the issuance of shares of capital stock to the holder
of this Security or any Affiliate thereof in connection with any strategic
relationship, joint venture, merger, consolidation, acquisition or similar
event.
(ii) "Convertible Securities" shall mean any evidences of
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indebtedness, shares (other than Common Stock) or other securities convertible
into or exchangeable for Common Stock.
(iii) "Options" shall mean rights, options, or warrants to
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subscribe for, purchase or otherwise acquire either Common Stock or Convertible
Securities.
(3) Deemed Issue of Additional Shares of Common Stock. In the event
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the Company at any time or from time to time after the Original Issue Date shall
issue any Options or Convertible Securities or shall fix a record date for the
determination of holders of any class of securities then entitled to receive any
such Options or Convertible Securities (to the extent not excluded from the
definition of Additional Shares of Common Stock), then the maximum number of
shares (as set forth in the instrument relating thereto without regard to any
provisions contained therein designed to protect against dilution) of Common
Stock issuable upon the exercise of such Options or, in the case of Convertible
Securities and Options therefor, the conversion or exchange of such Convertible
Securities, shall be deemed to be Additional Shares of Common Stock issued as of
the time of such issue or, in case such a record date shall have been fixed, as
of the close of business on such record date, provided further that in any such
case in which Additional Shares of Common Stock are deemed to be issued:
(i) no further adjustments in the Conversion Price shall be
made upon the subsequent issue of Convertible Securities or shares of Common
Stock upon the exercise of such Options or conversion or exchange of such
Convertible Securities;
(ii) if such Options or Convertible Securities by their terms
provide, with the passage of time or otherwise, for any increase in the
consideration payable to the Company, or decrease in the number of shares of
Common Stock issuable, upon the exercise, conversion or exchange thereof, the
Conversion Price computed upon the original issue thereof (or upon the
occurrence of a record date with respect thereto), and any subsequent
adjustments based thereon, shall, upon any such increase or decrease becoming
effective, be recomputed to reflect such
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increase or decrease insofar as it affects such Options or the rights of
conversion or exchange under such Convertible Securities (provided, however,
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that no such adjustment of the Conversion Price shall affect Common Stock
previously issued upon conversion of this Security, in whole or in part, as the
case may be);
(iii) upon the expiration or termination of any such Options or
any conversion or exchange rights related to such Convertible Securities, the
Conversion Price, to the extent in any way affected by or computed using such
Options or rights related to such Convertible Securities, shall be recomputed to
reflect the issuance of only the number of shares of Common Stock (and Options
or Convertible Securities which remain in effect) actually issued upon the
exercise of such Options or rights related to such Convertible Securities; and
(iv) no readjustment pursuant to clause (ii) or (iii) above
shall have the effect of increasing the Conversion Price to an amount which
exceeds the lower of (a) the Conversion Price on the original adjustment date,
or (b) the Conversion Price that would have resulted from any issuance of
Additional Shares of Common Stock between the original adjustment date and such
readjustment date.
(4) Determination of Consideration. For purposes of this Section
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2(b), the consideration received by the Company for the issue of any Additional
Shares of Common Stock shall be computed as follows:
(i) Cash and Property: Such consideration shall:
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(A) insofar as it consists of cash, be computed at the
aggregate amount of cash received by the Company;
(B) insofar as it consists of property other than cash, be
computed at the fair value thereof at the time of such issue, as determined in
good faith by the Board of Directors; and
(C) in the event Additional Shares of Common Stock are
issued together with other shares or securities or other assets of the Company
for consideration which covers both, be the proportion of such consideration so
received, computed as provided in clauses (A) and (B) above, as determined in
good faith by the Board of Directors.
(ii) Options and Convertible Securities. The consideration per
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share received by the Company for Additional Shares of Common Stock deemed to
have been issued pursuant to Section 2(b)(3), relating to Options and
Convertible Securities, shall be determined by dividing:
(A) the total amount, if any, received or receivable by the
Company as consideration for the issue of such Options or Convertible
Securities, plus the minimum aggregate amount of additional consideration (as
set forth in the instruments relating thereto, without regard to any provision
contained therein designed to protect against dilution) payable to the Company
upon the exercise of such Options or the conversion or exchange of such
Convertible
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Securities, or in the case of Options for Convertible Securities, the exercise
of such Options for Convertible Securities and the conversion or exchange of
such Convertible Securities, by
(B) the maximum number of shares of Common Stock (as set forth
in the instruments relating thereto, without regard to any provision contained
therein designed to protect against the dilution) issuable upon the exercise of
such Options or conversion or exchange of such Convertible Securities, or in the
case of Options for Convertible Securities, the exercise of such Options for
Convertible Securities and the conversion or exchange of such Convertible
Securities.
(c) Adjustment to Conversion Price for Subdivisions or Combinations
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of Common Stock. In case outstanding Common Stock shall be subdivided (by a
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stock split, stock dividend, recapitalization or otherwise) 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
Common Stock shall each be combined (by reverse stock split, recapitalization or
otherwise) 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.
(d) Adjustment to Conversion Price for Distributions of Property. In
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case the Company shall, by dividend or otherwise, distribute to all holders of
its Common Stock evidences of its indebtedness, shares of any class of capital
stock, or other property (including securities, but excluding (i) any dividend
or distribution paid exclusively in cash, (ii) any dividend or distribution of
Additional Shares of Common Stock referred to in Section 2(b), (iii) any stock
dividend to which Section 2(c) applies, and (iv) any merger or consolidation to
which Section 2(o) applies), the Conversion Price shall be adjusted so that the
same shall equal the rate determined by multiplying the Conversion Price in
effect immediately prior to the close of business on the Determination Date for
such distribution by a fraction of which (A) the numerator shall be the Current
Market Price per share of Common Stock on such Determination Date less the then
fair market value (as determined in good faith by the Board of Directors of the
Company) of the portion of the assets, shares or evidences of indebtedness so
distributed applicable to one share of Common Stock and (B) the denominator
shall be the Current Market Price per share of the Common Stock, such adjustment
to become effective immediately prior to the opening of business on the day
following such Determination Date. If the Board of Directors determines the
fair market value of any distribution for purposes of this Section 2(d) by
reference to the actual or when issued trading market for any securities
constituting such distribution, it must in doing so consider the prices in such
market over the same period used in computing the Current Market Price per
share.
(e) Adjustment to Conversion Price for Distributions of Cash. In case
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the Company shall, by dividend or otherwise, make a Cash Distribution, then, and
in each such case, immediately after the close of business on the Determination
Date for such Cash Distribution, the Conversion Price shall be adjusted so that
the same shall equal the rate determined by multiplying the Conversion Price in
effect immediately prior to the close of business on such Determination Date
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by a fraction (i) the numerator of which shall be equal to the Current Market
Price per share of the Common Stock on such Determination Date less an amount
equal to the quotient of (A) the amount of such Cash Distribution divided by (B)
the number of shares of Common Stock outstanding on such Determination Date and
(ii) the denominator of which shall be equal to the Current Market Price per
share of the Common Stock on such Determination Date.
(f) Adjustment to Conversion Price for Excess Purchase Payment. In
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case the Company or any Subsidiary shall make an Excess Purchase Payment, then,
and in each such case, immediately prior to the opening of business on the day
after the tender offer in respect of which such Excess Purchase Payment is to be
made expires, the Conversion Price shall be adjusted so that the same shall
equal the rate determined by multiplying the Conversion Price in effect
immediately prior to the close of business on the Determination Date for such
tender offer by a fraction (i) the numerator of which shall be equal to the
Current Market Price per share of Common Stock on such Determination Date less
an amount equal to the quotient of (A) the Excess Purchase Payment divided by
(B) the number of shares of Common Stock outstanding (including any tendered
shares) as of the Determination Date less the number of all Common Stock validly
tendered and not withdrawn as of the Determination Date and (ii) the denominator
of which shall be equal to the Current Market Price per share of Common Stock as
of such Determination Date.
(g) Adjustment to Conversion Price for Reclassification of Common
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Stock. The partial reclassification of Common Stock into securities other than
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Common Stock (other than any reclassification upon a consolidation or merger to
which Section 2(o) applies) shall be deemed to involve (i) a distribution of
such securities other than Common Stock to all holders of Common Stock (and the
effective date of such reclassification shall be deemed to be the Determination
Date), and (ii) a subdivision or combination, as the case may be, of the number
of shares of Common Stock outstanding immediately prior to such reclassification
into the number of shares of Common Stock outstanding immediately thereafter
(and the effective date of such reclassification shall be deemed to be "the day
upon which such subdivision becomes effective" or "the day upon which such
combination becomes effective", as the case may be, and "the day upon which such
subdivision or combination becomes effective" within the meaning of Section
2(c)).
(h) No Adjustments and Rounding. No adjustment in the Conversion
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Price shall be required unless such adjustment (plus any adjustments not
previously made by reason of this paragraph (h)) would require an increase or
decrease of at least one percent in such price; provided, however, that any
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adjustments which by reason of this paragraph (h) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 2 shall be made to the nearest cent.
(i) Adjustment for Tax Treatment. The Company may make such decreases
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in the Conversion Price, for the remaining term of the Securities or any shorter
term, in addition to those required by Section 2 as it considers to be advisable
in order to avoid or diminish any income tax to any holders of Common Stock
resulting from any dividend or distribution of stock or issuance of rights or
warrants to purchase or subscribe for stock or from any event treated as such
for income tax purposes.
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(j) Certificate of Conversion Price Adjustment. Whenever the
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Conversion Price is adjusted as provided in Section 2, the Company shall compute
the adjusted Conversion Price in accordance with Section 2 and shall prepare a
certificate signed by the chief financial officer of the Company setting forth
the adjusted Conversion Price and showing in reasonable detail the facts upon
which such adjustment is based, and shall promptly deliver such certificate to
the holder of this Security. As a condition to the effectiveness of any such
adjustment, the Company may require the holder of this Security to pay, in cash,
the amount of any withholding tax which may be due as a result of such
adjustment.
(k) Notice of Events. In case:
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(1) the Company shall declare a dividend or other distribution
on its Common Stock payable (i) otherwise than exclusively in cash or (ii)
exclusively in cash in an amount that would require any adjustment pursuant to
this Section 2; or
(2) the Company shall authorize the granting to the holders of
its Common Stock of rights, options or warrants to subscribe for or purchase any
shares of capital stock of any class or of any other rights; or
(3) of any reclassification of the Common Stock, or of any
consolidation, merger or share exchange to which the Company is a party and for
which approval of any shareholders of the Company is required, or of the
conveyance, sale, transfer or lease of all or substantially all of the assets of
the Company; or
(4) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(5) the Company or any Subsidiary shall commence a tender offer
for all or a portion of the Company's outstanding Common Stock (or shall amend
any such tender offer);
then the Company shall cause to be delivered to the holder of
this Security, at least 20 days (or 10 days in any case specified in clause (1)
or (2) above) prior to the applicable record, expiration and effective date
hereinafter specified, a notice stating (A) the date on which a record is to be
taken for the purpose of such dividend, distribution, rights, options or
warrants, or, if a record is not to be taken, the date as of which the holders
of Common Stock of record to be entitled to such dividend, distribution, rights,
options or warrants are to be determined, (B) the date on which the right to
make tenders under such tender offer expires and (C) the date on which such
reclassification, consolidation, merger, conveyance, transfer, sale, lease,
dissolution, liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, conveyance,
transfer, sale, lease, dissolution, liquidation or winding up. Neither the
failure to give such notice nor any defect therein shall affect the legality or
validity of the proceedings described in clauses (1) through (5) of this Section
2(k).
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(l) Reservation of Common Stock. The Company shall at all times
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reserve and keep available, free from preemptive rights, out of its authorized
but unissued Common Stock, for the purpose of effecting the conversion of the
Security, the full number of shares of Common Stock then issuable upon the
conversion of this Security.
(m) Taxes. The Company will pay any and all taxes and duties that may
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be payable in respect of the issue or delivery of Common Stock on conversion of
the Security, subject to receipt of amounts due hereunder from the holder of
this Security in respect of applicable withholding taxes, if any, and except for
taxes based on income or gain of such holder. The Company shall not, however,
be required to pay any tax or duty which may be payable in respect of any
transfer involved in the issue and delivery of Common Stock in a name other than
that of the holder of this Security (or a third party as may be designated by
the holder pursuant to Section 2(a)(4)), and no such issue or delivery shall be
made unless and until the Person requesting such issue has paid to the Company
the amount of any such tax or duty, or has established to the satisfaction of
the Company that such tax or duty has been paid.
(n) Due Authorization and Valid Issuance. The Company agrees that all
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Common Stock which may be delivered upon conversion of the Security, upon such
delivery, will have been duly authorized and validly issued and will be fully
paid and nonassessable (and shall be issued out of the Company's authorized but
unissued Common Stock) and, except as provided in Section 2(m), the Company will
pay all taxes, liens and charges with respect to the issue thereof.
(o) Consolidation, Merger, Etc. In case of any consolidation of the
--------------------------
Company with any other Person, any merger of the Company into another Person or
of another Person into the Company (other than a merger which does not result in
any reclassification, conversion, exchange or cancellation of outstanding Common
Stock of the Company) or any conveyance, sale, transfer or lease of all or
substantially all of the properties and assets of the Company, the Person formed
by such consolidation or resulting from such merger or which acquires such
properties and assets, as the case may be (except if such transaction involves a
Change of Control resulting from a sale of all or substantially all of the
assets of the Company solely for cash, and the holder of this Security has been
paid the full amount due upon such Change of Control pursuant to Section 3(a)
herein), shall execute and deliver to the holder of this Security a supplemental
agreement providing that such holder have the right thereafter, during the
period this Security shall be convertible as specified in Section 2(a), to
convert this Security only into the kind and amount of securities, cash and
other property receivable upon such consolidation, merger, conveyance, sale,
transfer or lease (including any Common Stock retainable) by a holder of the
number of shares of Common Stock of the Company into which this Security might
have been converted immediately prior to such consolidation, merger, conveyance,
sale, transfer or lease, assuming such holder of Common Stock of the Company (i)
is not a Person with which the Company consolidated, into which the Company
merged or which merged into the Company or to which such conveyance, sale,
transfer or lease was made, as the case may be (a "Constituent Person"), or an
------------------
Affiliate of a Constituent Person and (ii) failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, sale, transfer
or lease (provided that if the kind or amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, sale, transfer,
or lease is not the same for each share of Common Stock of the Company held
immediately prior to such consolidation, merger, conveyance, sale, transfer or
lease
-11-
by others than a Constituent Person or an Affiliate thereof and in respect of
which such rights of election shall not have been exercised ("Non-Electing
------------
Share"), then for the purpose of this Section 2(o) the kind and amount of
-----
securities, cash and other property receivable upon such consolidation, merger,
conveyance, sale, transfer or lease by the holders of 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 agreement shall provide for
adjustments which, for events subsequent to the effective date of such
supplemental agreement, shall be as nearly equivalent as may be practicable to
the adjustments to the Conversion Price provided for in this Section 2 with
respect to any securities into which this Security becomes convertible pursuant
to this Section 2(o). The above provisions of this Section 2(o) shall similarly
apply to successive consolidations, mergers, conveyances, sales, transfers or
leases. In this paragraph, "securities of the kind receivable" upon such
consolidation, merger, conveyance, transfer, sale or lease by a holder of Common
Stock means securities that, among other things, are registered and transferable
under the Securities Act, and listed and approved for quotation in all
securities markets, in each case to the same extent as such securities so
receivable by a holder of Common Stock. If this Section 2(o) applies to any
event or occurrence, then the provisions of Sections 2(b) to 2(i) shall not
apply.
(p) Registration and Listing. The Company (1) will effect all
------------------------
registrations with, and obtain all approvals by, all governmental authorities
that may be necessary under any United States Federal or state law (including
the Securities Act, the Securities Exchange Act of 1934 and state securities and
Blue Sky laws) for the Common Stock issuable upon conversion of this Security to
be lawfully issued and delivered as provided herein, and thereafter publicly
traded (if permissible under the Securities Act) and qualified or listed as
contemplated by clause (1) (it being understood that the Company shall not be
required to register the Common Stock issuable on conversion hereof under the
Securities Act except pursuant to the Registration Rights Agreement between the
Company and the initial holder of this Security); and (2) will list the Common
Stock required to be issued and delivered upon conversion of Securities, prior
to such issuance or delivery, on each national securities exchange on which
outstanding Common Stock is listed or quoted at the time of such delivery, or if
the Common Stock is not then listed on any securities exchange, to qualify the
Common Stock for quotation on the Nasdaq National Market or such other inter-
dealer quotation system, if any, on which the Common Stock is then quoted.
3. Right to Require Repurchase.
(a) The holder of this Security shall have the right, at such
holder's option, to require the Company to repurchase, and upon the exercise of
such right the Company shall repurchase, this Security, or any portion of the
principal amount hereof in an amount not less than $1,000,000, on the date (the
"Repurchase Date") that is: (i) any time on or after January 15, 2005, or (ii)
---------------
in the event that a Change in Control shall occur, then fifteen (15) Trading
Days after the date on which the Company gives notice of such Change of Control
to the holder of this Security, at a purchase price equal to the Repurchase
Price. Notwithstanding the foregoing, in the event the Change of Control
involves a purchase of all or substantially all of the assets of the Company
solely for cash, then upon the occurrence of such Change of Control, this
Security shall be automatically redeemed for an amount equal to accrued and
unpaid interest plus the greater of (i) 115% of the principal amount outstanding
under the Security or (ii) the fair market value of the shares of Common Stock
issuable upon conversion of this Security, assuming such conversion occurred
immediately prior to such
-12-
Change of Control. The Company agrees to give the holder of this Security
notice, in the manner provided in Section 9(b), of any Change in Control,
promptly and in any event not more than 2 Trading Days after the occurrence
thereof.
(b) To exercise a repurchase right, the holder shall deliver to the
Company, together with this Security, written notice of the holder's exercise of
such right, which notice shall set forth the name of the holder, the principal
amount of this Security to be repurchased (and, if this Security is to be
repurchased in part, the portion of the principal amount thereof to be
repurchased and the name of the Person in which the portion thereof to remain
outstanding after such repurchase is to be registered), a statement that an
election to exercise the repurchase right is being made thereby, and a statement
as to whether the repurchase is pursuant to a Change of Control or not (the
"Repurchase Notice"). The holder shall deliver the Repurchase Notice (i) in the
-----------------
case of a repurchase upon a Change of Control, not less than 5 days prior to the
Repurchase Date, or (ii) in the case of a repurchase other than upon a Change of
Control, not less than thirty (30) nor more than sixty (60) days prior to the
Repurchase Date. Such Repurchase Notice shall be irrevocable, except that the
right of the holder to convert this Security (or the portion hereof with respect
to which the repurchase right is being exercised) shall continue until the close
of business on the Trading Day prior to the Repurchase Date.
(c) In the event a repurchase right shall be exercised in accordance with
the terms hereof, the Company shall pay or cause to be paid to the holder the
Repurchase Price in cash only on or prior to the Repurchase Date.
(d) Without prejudice to any other rights that may be available to the
holder of this Security, if this Security (or portion thereof) is surrendered
for repurchase and the applicable Repurchase Price is not paid on the Repurchase
Date, the principal amount of this Security (or such portion hereof, as the case
may be) shall, until paid, bear interest to the extent permitted by applicable
law from the Repurchase Date at the rate of 12.0% per annum, payable in cash,
and shall remain convertible into Common Stock until the principal of this
Security (or portion thereof, as the case may be) shall have been paid or duly
provided for.
(e) If this Security is to be repurchased only in part, it shall be
surrendered to the Company at the Designated Office (with, if the Company so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company duly executed by, the holder hereof or his attorney
duly authorized in writing), and the Company shall execute and make available
for delivery to the holder without service charge, a new Security or Securities,
containing identical terms and conditions, each in an authorized denomination in
aggregate principal amount equal to and in exchange for the unrepurchased
portion of the principal of the Security so surrendered.
(f) In the event that there shall be any conversion of this Security
(including any deemed conversion) pursuant to Section 2 after the holder of this
Security has delivered a Repurchase Notice to the Company, the holder shall
promptly reimburse the Company for all fees, costs and expenses paid to third
parties incurred by it in connection with any arrangement or facility intended
to finance the Repurchase Price of the portion of this Security so converted
(and such
-13-
reimbursement shall be limited to those fees, costs and expenses incurred by the
Company after delivery of such Repurchase Notice and attributable to financing
such Repurchase Price).
(g) For purposes of this Section 3:
(1) the term "beneficial owner" shall be determined in
----------------
accordance with Rule 13d-3 promulgated by the Securities and Exchange Commission
pursuant to the Securities Exchange Act of 1934;
(2) a "Change in Control" shall be deemed to have occurred at
-----------------
the time, after the original issuance of this Security, of:
(i) the acquisition by any Person of beneficial
ownership, directly or indirectly, through a purchase, merger or other
acquisition transaction or series of transactions, of shares of capital stock of
the Company entitling such Person to exercise 50% or more of the total voting
power of all shares of capital stock of the Company entitled to vote generally
in the elections of directors (any shares of voting stock of which such Person
is the beneficial owner that are not then outstanding being deemed outstanding
for purposes of calculating such percentage) other than any such acquisition by
the Company or any employee benefit plan of the Company; or
(ii) any consolidation or merger of the Company with or
into, any other Person, any merger of another Person with or into the Company,
or any conveyance, transfer, sale, lease or other disposition of all or
substantially all of the assets of the Company to another Person (other than (A)
any such transaction pursuant to which holders of Common Stock immediately prior
to such transaction have the entitlement to exercise, directly or indirectly,
50% or more of the total voting power of all shares of capital stock entitled to
vote generally in the election of directors of the continuing or surviving
Person immediately after such transaction and (B) any merger (x) which does not
result in any reclassification, conversion, exchange or cancellation of
outstanding Common Stock or (y) which is effected solely to change the
jurisdiction of incorporation of the Company and results in a reclassification,
conversion or exchange of outstanding Common Stock into solely shares of common
stock); or
(iii) any transaction or event (whether by means of an
exchange offer, liquidation, tender offer, consolidation, merger, combination,
reclassification, recapitalization or otherwise) in connection with which all or
substantially all shares of Common Stock are exchanged for, converted into,
acquired for or constitute solely the right to receive, consideration which is
not all or substantially all common stock that is (a) listed on, or immediately
after the transaction or event will be listed on, a United States national
securities exchange, or (b) approved, or immediately after the transaction or
event will be approved, for quotation on the Nasdaq National Market or any
similar United States system of automated dissemination of quotations of
securities prices; and
(3) "Repurchase Price" means the sum of (i) accrued and unpaid
----------------
interest on this Security to the date of payment and (ii) (A) in the case of
repurchase pursuant to a Change of Control, 115% of the principal amount of this
Security then outstanding, or (B) in the case of
-14-
repurchase other than pursuant to a Change of Control, 100% of the principal
amount of this Security to be repurchased pursuant to this Section 3.
4. Certain Covenants.
(a) Financial Information. Whether or not required by the rules and
---------------------
regulations of the Commission, so long as this Security is outstanding, the
Company will furnish to the holders of this Security (i) all quarterly and
annual financial information that would be required to be contained in a filing
with the Commission on Forms 10-Q and 10-K (or any successor forms) if the
Company were required to file such Forms, including a "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and, with respect
to the annual information only, a report thereon by the Company's certified
independent accountants and (ii) all current reports that would be required to
be filed with the Commission on Form 8-K (or any successor form) if the Company
were required to file such reports. In addition, whether or not required by the
rules and regulations of the Commission, the Company will file a copy of all
such information and reports with the Commission for public availability (unless
the Commission will not accept such a filing) and make such information
available to securities analysts and prospective investors upon request. In
addition, the Company has agreed that, for so long as this Security remains
outstanding, it will furnish to the holder of this Security and to securities
analysts and prospective investors, upon their request, the information required
to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
5. Events of Default.
(a) "Event of Default", wherever used herein, means any one of the
----------------
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(1) default in the payment of any principal, interest or
premium under this Security when it becomes due and payable and the continuance
thereof for a period of three (3) business days; or
(2) default by the Company in the performance of its
obligations in respect of any conversion of this Security (or any portion
hereof) in accordance with Section 2 for a period of 5 days; or
(3) failure by the Company to give any notice of a Change of
Control required to be delivered in accordance with Section 3(a); or
(4) (i) default in the performance of or breach of the
covenants specified in Section 4, (ii) default in the performance, or breach, of
any other covenant, obligation or agreement of the Company herein (other than a
covenant a default in the performance or breach of which is specifically dealt
with elsewhere in this Section 5(a)), (iii) a material breach of any covenant
under the Agreement, or (iv) a breach of any representation or warranty under
the Agreement resulting in a Material Adverse Effect, and continuance of such
default or breach for a period of 30 days after there has been given, by
registered or certified mail, to the Company by the
-15-
holder of this Security a written notice specifying such default or breach and
requiring it to be remedied and stating that such notice is a "Notice of
Default" hereunder; or
(5) a default under (i) the Company Credit Agreement or (ii) any bond,
debenture, note or other evidence of indebtedness for money borrowed by the
Company or any Subsidiary, or under any agreement, mortgage, indenture or
instrument under which there may be issued or by which there may be secured or
evidenced any indebtedness for money borrowed by the Company or any Subsidiary,
with a principal amount then outstanding in excess of $7,000,000, whether such
indebtedness now exists or shall hereafter be created, which default shall
constitute a failure to pay the principal of such indebtedness (in whole or in
any part greater than $7,000,000) when due and payable or may result in such
indebtedness (in whole or in any part greater than $7,000,000) becoming or being
declared due and payable prior to the date on which it would otherwise have
become due and payable; or
(6) the entry by a court having jurisdiction in the premises of (i) a
decree or order for relief in respect of the Company or any Significant
Subsidiary in an involuntary case or proceeding under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law or (ii) a
decree or order approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company or any
Significant Subsidiary under any applicable Federal or State law, or appointing
a custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or any Significant Subsidiary or of any
substantial part of its or their respective property, or ordering the winding up
or liquidation of its affairs, and the continuance of any such decree or order
for relief or any such other decree or order unstayed and in effect for a period
of 60 consecutive days; or
(7) the commencement by the Company or any Significant Subsidiary of a
voluntary case or proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or of any other case or
proceeding to be adjudicated a bankrupt or insolvent, or the consent by the
Company or any Significant Subsidiary to the entry of a decree or order for
relief in respect of the Company or any Significant Subsidiary in an involuntary
case or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against either the Company or a Significant
Subsidiary, or the filing by either the Company or a Significant Subsidiary of a
petition or answer or consent seeking reorganization or similar relief under any
applicable Federal or State law, or the consent by it to the filing of such
petition or to the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official of the
Company or any Significant Subsidiary or of any substantial part of the property
of either the Company or any Significant Subsidiary, or the making by either the
Company or any Significant Subsidiary of an assignment for the benefit of
creditors, or the admission by either the Company or any Significant Subsidiary
in writing of its inability to pay its debts generally as they become due, or
the taking of corporate action by the Company or any Significant Subsidiary in
furtherance of any such action.
(b) If an Event of Default (other than an Event of Default specified in
Section 5(a)(6) or 5(a)(7)) occurs and is continuing, then in every such case
the holder of this Security may declare the principal hereof to be due and
payable immediately, by a notice in writing to the Company, and
-16-
upon any such declaration such principal and all accrued interest thereon shall
become immediately due and payable. If an Event of Default specified in Section
5(a)(6) or 5(a)(7) occurs and is continuing with respect to the Company, the
principal of, and accrued interest on, this Security shall ipso facto become
immediately due and payable without any declaration or other act of the holders.
(c) The Company will give the holder of this Security notice, within
two Trading Days of the occurrence thereof, of any Event of Default or any event
that, with the giving of notice or passage of time or both, would become an
Event of Default. Such notice shall be given in the manner provided in Section
9(b).
6. Consolidation, Merger, Etc.
(a) The Company shall not consolidate with or merge into any other
Person or, directly or indirectly, convey, transfer, sell or lease all or
substantially all of its properties and assets to any Person, and the Company
shall not permit any Person to consolidate with or merge into the Company or,
directly or indirectly, convey, transfer, sell or lease all or substantially all
of its properties and assets to the Company, unless:
(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer, sell or lease all or substantially all of
its properties and assets to any Person, the Person formed by such consolidation
or into which the Company is merged or the Person which acquires by conveyance,
transfer or sale, or which leases, all or substantially all the properties and
assets of the Company shall be a corporation, limited liability company,
partnership 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, if other than the Company, by an agreement supplemental
hereto, executed and delivered to the holder of this Security in form
satisfactory to the holder, the due and punctual payment of the principal of and
any interest on this Security and the performance or observance of every
covenant of this Security on the part of the Company to be performed or
observed, including, to the extent provided in Section 2(o), the conversion
rights provided herein (which shall thereafter relate to common stock of such
successor, on a basis reasonably designed to preserve the economic value to the
holder of this Security of such conversion rights);
(2) immediately after giving effect to such transaction and
treating any indebtedness which becomes an obligation of the Company or a
Subsidiary of the Company as a result of such transaction as having been
incurred by the Company or such Subsidiary of the Company at the time of such
transaction, no Event of Default, and no event which, after notice or lapse of
time or both, would become an Event of Default, shall have happened and be
continuing; and
(3) the Company has delivered to the holder of this Security
an officers' certificate and an opinion of counsel, each stating that such
consolidation, merger, conveyance, transfer, sale or lease and, if a
supplemental agreement is required in connection with such transaction, such
supplemental agreement, comply with this Section and that all conditions
precedent herein provided for relating to such transaction have been complied
with.
-17-
(b) Upon any consolidation of the Company with, or merger of the
Company into, any other Person or any conveyance, transfer, sale or lease of all
or substantially all of the properties and assets of the Company in accordance
with Section 6(a) (except if such transaction involves a Change of Control
resulting from a sale of all or substantially all of the assets of the Company
solely for cash, and the holder of this Security has been paid the full amount
due upon such Change of Control pursuant to Section 3(a) herein), the successor
Person formed by such consolidation or into which the Company is merged or to
which such conveyance, transfer, sale or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Security with the same effect as if such successor Person had been named as
the Company herein, and thereafter, except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under this
Security.
7. Subordination.
(a) The Company covenants and agrees, and the holder of this Security
by its acceptance hereof likewise covenants and agrees, that this Security is
subject to the provisions of this Section 7; and each Person holding this
Security, whether upon original issue or upon transfer, assignment or exchange
thereof, accepts and agrees to be bound by such provisions.
The payment of the principal of, premium, if any, and
interest on this Security (including, but not limited to, the redemption price
or repurchase price with respect to this Security or payment in cash for NASD
Excess Shares or HSR Excess Shares pursuant to Section 2(a)(6) or (7), as the
case may be) shall, to the extent and in the manner hereinafter set forth, be
subordinated to the prior payment in full, in cash or in such other form of
payment as may be acceptable to the holders of Senior Indebtedness, of all
Senior Indebtedness.
No provision of this Section 7 shall prevent the occurrence
of any default or Event of Default under this Security.
(b) Payments to Holders. No payment (including pursuant to any
-------------------
redemption or repurchase of this Security or payment in cash for NASD Excess
Shares or HSR Excess Shares pursuant to Section 2(a)(6) or (7), as the case may
be) shall be made with respect to the principal of, or premium, if any, or
interest on this Security, if:
(1) a default in the payment of principal, premium, if any,
or interest or other payment due on Senior Indebtedness occurs and is continuing
beyond any applicable period of grace (a "Payment Default"); or
---------------
(2) a default, other than a Payment Default, occurs and is
continuing with respect to Senior Indebtedness that then permits holders of the
Senior Indebtedness as to which such default related to accelerate its maturity
and the holder of this Security and the Company receive a written notice of such
default (a "Payment Blockage Notice") from a representative of Senior
-----------------------
Indebtedness or a holder of Senior Indebtedness or the Company (a "Non-Payment
-----------
Default").
-------
The Company may and shall resume payments on this Security
(i) in the case of a Payment Default, on the date upon which such default is
cured or waived or ceases to exist, and
-18-
(ii) in the case of a Non-Payment Default with respect to Senior Indebtedness,
on the earlier of the date on which the Non-Payment Default is cured or waived
or ceases to exist or 179 days have passed after the date on which the
applicable Payment Blockage Notice is received.
No new period of payment blockage may be commenced pursuant to a
Payment Blockage Notice unless (A) at least 365 days shall have elapsed since
the Company's receipt of the immediately prior Payment Blockage Notice and (B)
all scheduled payments of principal, premium, if any, and interest on this
Security that have come due have been paid in full in cash, or in such other
form of payment as may be acceptable to the holder of this Security, and the
holder of this Security shall not have begun proceedings to enforce the right of
the holder to receive payments. No default (whether or not such event of
default is on the same issue of Senior Indebtedness) that existed or was
continuing on the date of delivery of any Payment Blockage Notice to the holder
of this Security shall be, or be made, the basis for a subsequent Payment
Blockage Notice.
In addition, in the event of any acceleration of this Security because
of an Event of Default, no payment or distribution (including with respect to
any redemption or repurchase of this Security or payment in cash for NASD Excess
Shares or HSR Excess Shares pursuant to Section 2(a)(6) or (7), as the case may
be) shall be made to the holder of this Security with respect to the principal
of, premium, if any, or interest on this Security, until all Senior Indebtedness
has been paid in full in cash or other payment satisfactory to the holders of
Senior Indebtedness or such acceleration is rescinded in accordance with the
terms of this Security. If payment of this Security is accelerated because of
an Event of Default, the Company shall promptly notify holders of Senior
Indebtedness of the acceleration.
Notwithstanding the foregoing, in the event that the holder of this
Security receives any payment or distribution of assets of the Company of any
kind in contravention of any term of this Section 7, whether in cash, property
or securities, including, without limitation, by way of setoff or otherwise,
before all Senior Indebtedness is paid in full, in cash or such other form of
payment as may be acceptable to the holders of Senior Indebtedness, then such
payment or distribution shall be held by the recipient or recipients in trust
for the benefit of, and shall immediately be paid over or delivered to, the
holders of Senior Indebtedness or their respective representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Senior Indebtedness may have been issued,
as their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Indebtedness remaining unpaid to the
extent necessary to make payment in full, in cash or such other form of payment
as may be acceptable to the holders of Senior Indebtedness, of all Senior
Indebtedness remaining unpaid, after giving effect to any concurrent payment or
distribution, or provision therefor, to or for the holders of such Senior
Indebtedness.
This Section 7(b) shall be subject to the further provisions of
Section 7(e).
(c) Bankruptcy and Dissolution, Etc. Upon any payment by the Company, or
-------------------------------
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, to creditors upon any dissolution, winding-up,
liquidation or reorganization of the Company, whether voluntary or involuntary
or in bankruptcy, insolvency, receivership or other
-19-
proceedings, all amounts due or to become due upon all Senior Indebtedness shall
first be paid in full, in cash or in such other form of payment as may be
acceptable to the holders of Senior Indebtedness, before any payment is made on
account of the principal or premium, if any, and interest on this Security; and
upon any such dissolution, winding-up, liquidation or reorganization or
bankruptcy, insolvency, receivership or other such proceedings, any payment by
the Company, or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the holders of this Security
would be entitled, except for the provisions of this Section 7, shall (except as
aforesaid) 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 the holder of this Security if received by it, directly to the holders of
Senior Indebtedness (pro rata to such holders on the basis of the respective
amounts of Senior Indebtedness held by such holders, or as otherwise required by
law or a court order) or their respective representative or representatives, or
to the trustee or trustees under any indenture pursuant to which any instruments
evidencing any Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all Senior Indebtedness in
full in cash or in such other form of payment as may be acceptable to the
holders of Senior Indebtedness after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness, before any payment or
distribution is made to the holder of this Security.
Notwithstanding the foregoing, in the event that the holder of this
Security receives any payment or distribution of assets of the Company of any
kind in contravention of any term of this Security, whether in cash, property or
securities, including, without limitation, by way of setoff or otherwise, before
all Senior Indebtedness is paid in full, in cash or such other form of payment
as may be acceptable to the holders of Senior Indebtedness, then such payment or
distribution shall be held by the recipient or recipients in trust for the
benefit of, and shall immediately be paid over or delivered to, the holders of
Senior Indebtedness or their respective representative or representatives, or to
the trustee or trustees under any indenture pursuant to which any instruments
evidencing any Senior Indebtedness may have been issued, as their respective
interests may appear, as calculated by the Company, for application to the
payment of all Senior Indebtedness remaining unpaid to the extent necessary to
make payment in full, in cash or such other form of payment as may be acceptable
to the holders of Senior Indebtedness, of all Senior Indebtedness remaining
unpaid, after giving effect to any concurrent payment or distribution, or
provision therefor, to or for the holders of such Senior Indebtedness.
For purposes of Section 7(b) hereof and this Section 7(c), the words
"cash, property or securities" shall not be deemed to include shares of stock of
the Company as reorganized or readjusted, or securities of the Company or any
other corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated (at least to the extent provided in this
Section 7 with respect to this Security) to the payment of all Senior
Indebtedness which may at the time be outstanding. The consolidation of the
Company with, or the merger of the Company into, another corporation or the
liquidation or dissolution of the Company following the conveyance or transfer
of its property as an entirety, or substantially as an entirety, to another
corporation upon the terms and conditions provided for in Section 6 shall not be
deemed a dissolution, winding-up, liquidation or reorganization for the purposes
of this Section 7(c) if such other corporation shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions stated
in Section 6.
-20-
This Section 7(c) shall be subject to the further provisions of
Section 7(e).
(d) Subrogation. Subject to the payment in full in cash, or in such
-----------
other form of payment as may be acceptable to the holders of Senior
Indebtedness, of all Senior Indebtedness, the rights of the holder of this
Security shall be subrogated to the extent of the payments or distributions made
to the holders of such Senior Indebtedness pursuant to the provisions of this
Section 7 (equally and ratably with the holders of all indebtedness of the
Company which by its express terms is subordinated to other indebtedness of the
Company to substantially the same extent as this Security is subordinated and is
entitled to like rights of subrogation) to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until the
principal of, and premium, if any, and interest on this Security shall be paid
in full; and, for the purposes of such subrogation, no payments or distributions
to the holders of the Senior Indebtedness of any cash, property or securities to
which the holder of this Security would be entitled except for the provisions of
this Section 7, and no payment over pursuant to the provisions of this Section
7, to or for the benefit of the holders of Senior Indebtedness by holders of
this Security, shall, as between the Company, its creditors other than holders
of Senior Indebtedness, and the holder of this Security, be deemed to be a
payment by the Company to or on account of the Senior Indebtedness; and no
payments or distributions of cash, property or securities to or for the benefit
of the holder of this Security pursuant to the subrogation provisions of this
Section 7, which would otherwise have been paid to the holders of Senior
Indebtedness shall be deemed to be a payment by the Company to or for the
account of this Security. It is understood that the provisions of this Section 7
are and are intended solely for the purposes of defining the relative rights of
the holder of this Security, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
Nothing contained in this Section 7 or elsewhere in this Security
is intended to or shall impair, as among the Company, its creditors other than
the holders of Senior Indebtedness, and the holder of this Security, the
obligation of the Company, which is absolute and unconditional, to pay to the
holder of this Security the principal of, and premium, if any, and interest on
the Security as and when the same shall become due and payable in accordance
with their terms, or is intended to or shall affect the relative rights of the
holder of this Security and creditors of the Company other than the holders of
the Senior Indebtedness, nor shall anything herein or therein prevent the holder
of this Security from exercising all remedies otherwise permitted by applicable
law upon default under this Security, subject to the rights, if any, under this
Section 7 of the holders of Senior Indebtedness in respect of cash, property or
securities of the Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company
referred to in this Section 7, the holder of this Security shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction in
which such bankruptcy, dissolution, winding-up, liquidation or reorganization
proceedings are pending, or a certificate of the receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, delivered to the holder of this Security, for the purpose of
ascertaining the Persons entitled to participate in such distribution, the
holders of the Senior Indebtedness and other indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Section 7.
-21-
(e) Notice. The Company shall give prompt written notice to the holder of
------
this Security of any fact known to the Company which would prohibit the making
of any payment of monies to in respect of this Security pursuant to the
provisions of this Section 7. Notwithstanding the provisions of this Section 7
or any other provision of this Security, the holder of this Security shall not
be charged with knowledge of the existence of any Senior Indebtedness or of any
default or event of default with respect to any Senior Indebtedness or of any
other facts which would prohibit the making of any payment of monies to the
holder of this Security pursuant to the provisions of this Section 7, unless and
until the holder of this Security shall have received written notice thereof in
the manner set forth in Section 9(b) from the Company or a holder or holders of
Senior Indebtedness or from any trustee thereof who shall have been certified by
the Company or otherwise established to the reasonable satisfaction of the
holder of this Security to be such holder or trustee; and before the receipt of
any such written notice, the holder of this Security shall be entitled in all
respects to assume that no such facts exist.
The holder of this Security shall be entitled to rely on the
delivery to it of a written notice by a Person representing itself to be a
holder of Senior Indebtedness (or a trustee on behalf of such holder) to
establish that such notice has been given by a holder of Senior Indebtedness or
a trustee on behalf of any such holder or holders. In the event that the holder
of this Security determines in good faith that further evidence is required with
respect to the right of any Person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to this Section 7, the
holder of this Security may request such Person to furnish evidence to the
reasonable satisfaction of the holder of this Security as to the amount of
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Section 7, and if such
evidence is not furnished the holder of this Security may defer any payment to
such Person pending judicial determination as to the right of such Person to
receive such payment.
(f) No Impairment of Subordination. No right of any present or future
------------------------------
holder of any Senior Indebtedness to enforce subordination as herein provided
shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Company or by any act or failure to act, in good faith,
by any such holder, or by any noncompliance by the Company with the terms,
provisions and covenants of this Security, regardless of any knowledge thereof
which any such holder may have or otherwise be charged with.
(g) Certain Conversions Deemed Payment. For the purposes of this Section 7
----------------------------------
only, (1) the issuance and delivery of Junior Securities upon conversion of this
Security in accordance with Section 2 shall not be deemed to constitute a
payment or distribution on account of the principal of (or premium, if any) or
interest on this Security or on account of the purchase or other acquisition of
this Security, and (2) the payment, issuance or delivery of cash (including cash
paid for fractional shares upon conversion of this Security in accordance with
Section 2), property or securities (other than Junior Securities) upon
conversion of this Security in accordance with Section 2 shall be deemed to
constitute payment on account of the principal of this Security. For the
purposes of this Section, the term "Junior Securities" means (a) shares of any
-----------------
stock of any class of the Company and (b) 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, this Security is
so subordinated as provided in this Section
-22-
7. Nothing contained in this Section 7 or elsewhere in this Security is intended
to or shall impair, as among the Company, its creditors other than holders of
Senior Indebtedness and the holder of this Security, the right, which is
absolute and unconditional, of the holder of this Security to convert this
Security in accordance with Section 2.
8. Definitions. Unless otherwise defined in this Security, the following
capitalized terms shall have the following respective meanings when used herein:
"Additional Shares of Common Stock" has the meaning given to such term in
---------------------------------
Section 2(b)(2) herein.
"Affiliate" of any specified Person means any other Person directly or
---------
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agreement" means the Securities Purchase Agreement dated as of January 14,
---------
2002, by and between the Company and Purchaser, as defined therein.
"Cash Distribution" means the distribution by the Company to all holders of
-----------------
its Common Stock of cash, other than any cash that is distributed upon a merger
or consolidation to which Section 2(o)) applies or as part of a distribution
referred to in Section 2(d).
"Change of Control" has the meaning given to such term in Section 3(f)(2)
-----------------
herein.
"Closing Price" means, with respect to the Common Stock of the Company, for
-------------
any day, the reported last sale price per share on the Nasdaq National Market,
or, if the Common Stock is not admitted to trading on the Nasdaq National
Market, on the principal national securities exchange or inter-dealer quotation
system on which the Common Stock is listed or admitted to trading, or if not
admitted to trading on the Nasdaq National Market, or listed or admitted to
trading on any national securities exchange or inter-dealer quotation system,
the closing bid price per share in the over-the-counter market as furnished by
any New York Stock Exchange member firm selected from time to time by the
Company for that purpose.
"Commission" means the United States Securities and Exchange Commission, or
----------
any other federal agency at the time administering the Securities and Exchange
Act of 1934, as amended, or the Securities Act, whichever is the relevant
statute for the particular purpose.
"Company" means Artesyn Technologies, Inc., a Florida corporation.
-------
"Common Stock" means the Common Stock, par value $0.01 per share, of the
------------
Company authorized at the date of this instrument as originally executed.
Subject to the provisions of this Section 2, shares issuable on conversion or
repurchase of this Security shall include only Common Stock or shares of any
class or classes of common stock resulting from any reclassification or
reclassifications thereof; provided, however, that if at any time there shall be
-------- -------
more than one such
-23-
resulting class, the shares so issuable on conversion of this Security shall
include shares of all such classes, and 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 Credit Agreement" means the Credit Agreement, dated as of January
------------------------
23, 2001, as amended, among the Company and certain of its Subsidiaries, Bank of
America, N.A. and the other lender parties thereto (the "Lenders"), as such
-------
agreement is amended, modified, restated or supplemented through the date
hereof.
"Constituent Person" has the meaning given to such term in Section 2(o)
------------------
herein.
"Conversion Notice" has the meaning given to such term in Section 2(a)(1)
-----------------
herein.
"Conversion Price" has the meaning given to such term in Section 2(a)(1)
----------------
herein.
"Convertible Securities" has the meaning given to such term in Section
----------------------
2(b)(2) herein.
"Current Market Price" per share of Common Stock on any date shall be
--------------------
calculated by the Company and be deemed to be the average of the daily Closing
Prices for the five consecutive Trading Days commencing ten Trading Days before
the earlier of (i) the day in question and (ii) the day before the "ex date"
-------
with respect to the issuance or distribution requiring such computation. For
purposes of this paragraph, the term "ex date", when used with respect to any
issuance or distribution, means the first date on which the Common Stock trade
regular way in the applicable securities market or on the applicable securities
exchange without the right to receive such issuance or distribution.
"Designated Office" has the meaning given to such term in the forepart of
-----------------
this Security.
"Determination Date" means, in the case of a dividend or other
------------------
distribution, including the issuance of rights, options or warrants, to
shareholders, the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution and, in the case of a tender offer,
the last time that tenders could have been made pursuant to such tender offer.
"DOJ" has the meaning given to such term in the Agreement.
---
"Events of Default" has the meaning given to such term in Section 5(a)
-----------------
herein.
"Excess Purchase Payment" means the product of (A) the excess, if any, of
-----------------------
(i) the amount of cash plus the fair market value (as determined in good faith
by the Company's Board of Directors) of any non-cash consideration required to
be paid with respect to one share of Common Stock acquired or to be acquired in
a tender offer made by the Company or any Subsidiary of the Company for all or
any portion of the Common Stock over (ii) the Current Market Price per share as
of the last time that tenders could have been made pursuant to such tender offer
and (B) the number of shares of Common Stock validly tendered and not withdrawn
as of the Determination Date in respect of such tender offer.
-24-
"FTC" has the meaning given to such term in the Agreement.
---
"GAAP" means generally accepted United States accounting principles set
----
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board that are applicable
to the circumstances as of the date of determination.
"HSR Act" has the meaning given to such term in the Agreement.
-------
"HSR Excess Shares" has the meaning given to such term in Section 2(a)(7)
-----------------
herein.
"HSR Filing" has the meaning given to such term in the Agreement.
-----------
"Junior Securities" has the meaning given to such term in Section 7(g)
-----------------
herein.
"Lenders" has the meaning given to such term in the definition of Company
-------
Credit Agreement in this Section 8.
"Maturity Date" means January 15, 2007.
-------------
"NASD Excess Shares" has the meaning given to such term in Section 2(a)(6)
------------------
herein.
"Non-Electing Share" has the meaning given to such term in Section 2(o)
------------------
herein.
"Non-Exclusive Remedy" has the meaning given to such term in the
--------------------
Registration Rights Agreement.
"Non-Payment Default" has the meaning given to such term in Section 7(b)
-------------------
herein.
"Non-Voting Legend" has the meaning given to such term in Section 2(a)(7)
-----------------
herein.
"Options" has the meaning given to such term in Section 2(b)(2) herein.
-------
"Original Issue Date" has the meaning given to such term in the first
-------------------
paragraph of this Security.
"Payment Blockage Notice" has the meaning given to such term in Section
-----------------------
7(b) herein.
"Person" shall mean and include an individual, a partnership, a corporation
------
(including a business trust), a joint stock company, a limited liability
company, an unincorporated association, a joint venture or other entity or a
governmental authority.
"Purchaser Group" has the meaning given to such term in the Agreement.
---------------
"Redemption Date" has the meaning given to such term in Section 1 hereof.
---------------
"Registration Rights Agreement" means the Registration Rights Agreement,
-----------------------------
dated as of January 15, 2002, between the Company and the initial holder of this
Security.
-25-
"Repurchase Date" has the meaning given to such term in Section 3(a)
---------------
herein.
"Repurchase Notice" has the meaning given to such term in Section 3(b)
-----------------
herein.
"Repurchase Price" has the meaning given to such term in Section 3(f)(4)
----------------
herein.
"Rights Agreement" means the Amended and Restated Rights Agreement between
----------------
the Company and Bank of New York dated as of November 21, 1998.
"Securities Act" means the Securities Act of 1933, as amended.
--------------
"Security" means this 3.0% Convertible Subordinated Promissory Note due
--------
January 15, 2007, which upon replacement by the Company in whole or in part in
accordance with the terms herein shall be a new Security or Securities, as the
case may be.
"Senior Indebtedness" means the principal of, premium, if any, interest on
-------------------
(including any interest accruing after the filing of a petition by or against
the Company under any bankruptcy law, whether or not allowed as a claim after
such filing in any proceeding under such bankruptcy law) and any other payment
obligation of the Company under the Company Credit Agreement or any related
notes, guarantees, collateral documents, instruments, and agreements executed in
connection therewith, and in each case as amended, modified, renewed, refunded,
replaced or refinanced from time to time with the same Lenders or one or more
new commercial banks, provided, however, that (A) the amount of Senior
-------- -------
Indebtedness shall not exceed $85,000,000 in the aggregate, (B) that in no event
shall the aggregate amount of Senior Indebtedness exceed fifty percent (50%) of
the Company's then market capitalization; and (C) in order for any such
obligation (other than pursuant to the Company Credit Agreement) to be
considered "Senior Indebtedness," the terms of the contract, instrument or other
agreement shall not expressly restrict the delivery of a Repurchase Notice by
any holder hereof or the payment of the (1) Repurchase Price (or other amounts
payable to holder) upon exercise of the holder's rights (voluntarily or
automatically) under Section 3 herein, (2) cash for NASD Excess Shares or HSR
Excess Shares under Section 2(a)(6)(iv) or 2(a)(7)(v), respectively, herein,
and/or (3) any regularly scheduled payment of principal or interest on this
Security, other than under the circumstances described in Section 7 hereof.
"Significant Subsidiary" has the meaning given to such term in Section 1.02
----------------------
of Regulation S-X as promulgated by the Securities and Exchange Commission and
shall include without limitation as of the date hereof Artesyn North America,
Inc. and Artesyn Technologies Communications Products, Inc.
"Subsidiary" shall mean (a) any corporation of which more than 50% of the
----------
issued and outstanding equity securities having ordinary voting power to elect a
majority of the board of directors of such corporation is at the time directly
or indirectly owned or controlled by the Company, (b) any partnership, joint
venture, limited liability company or other association of which more than 50%
of the equity interests having the power to vote, direct or control the
management of such partnership, joint venture, limited liability company or
other association is at the time directly or indirectly owned and controlled by
the Company, and (c) any other entity included in the financial statements of
the Company on a consolidated basis.
-26-
"Trading Day" means (i) if the Common Stock is admitted to trading on the
-----------
Nasdaq National Market or any other system of automated dissemination of
quotations of securities prices, a day on which trades may be effected through
such system; (ii) if the Common Stock is listed or admitted for trading on the
New York Stock Exchange or any other national securities exchange, a day on
which such exchange is open for business; or (iii) if the Common Stock is not
admitted to trading on the Nasdaq National Market or listed or admitted for
trading on any national securities exchange or any other system of automated
dissemination of quotation of securities prices, a day on which the Common Stock
is traded regular way in the over-the-counter market and for which a closing bid
and a closing asked price for the Common Stock are available.
"Warrant" means the warrant issued as of the date hereof by the Company to
-------
the initial holder of this Security, or any security issued in replacement or in
lieu thereof.
9. Other.
(a) No provision of this Security shall alter or impair the
obligation of the Company, which is absolute and unconditional, to pay the
principal of and interest, if any, on this Security at the times, places and
rate, and in the coin or currency, herein prescribed or to convert this Security
as herein provided.
(b) The Company will give prompt written notice to the holder of this
Security of any change in the location of the Designated Office. Any notice to
the Company or to the holder of this Security shall be given in the manner set
forth in the Agreement, provided that the holder of this Security, if not a
party to the Agreement, may specify alternative notice instructions to the
Company.
(c) Transfers of this Security shall only be made in accordance with
the provisions of this paragraph (c).
(i) At any time on or after the third anniversary of Original
Issue Date of this Warrant, the holder of this Security may transfer this
Security, in whole or in part (having a principal amount of not less than
$5,000,000) pursuant to the terms of subparagraph (iii) below.
(ii) Notwithstanding the rights set forth in subparagraph (i)
above, the holder of this Security may transfer this Security, in whole or in
part, from time to time and at any time after the Original Issue Date, to any
affiliate (or affiliate(s) thereof, direct or indirect) of the initial holder,
or to any affiliate(s), direct or indirect, of such transferee(s), pursuant to
the terms of subparagraph (iii) below.
(iii) The transfer of this Security is registrable on the
register maintained by the Company upon surrender of this Security for
registration of transfer at the Designated Office, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company duly executed by, the holder hereof or such holder's attorney duly
authorized in writing, and thereupon one or more new Securities, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees. Such Securities are issuable only in
registered form without coupons in an amount no less than $5,000,000. No service
charge shall be made for any such registration of transfer, but the Company may
require payment of
-27-
a sum sufficient to recover any tax or other governmental charge payable in
connection therewith. Prior to due presentation of this Security for
registration of transfer, the Company and any agent of the Company may treat the
Person in whose name this Security is registered as the owner thereof for all
purposes, whether or not this Security be overdue, and neither the Company nor
any such agent shall be affected by notice to the contrary.
(d) This Security shall be governed by and construed in accordance
with the internal laws of the State of New York, United States of America,
applicable to contracts entered into and to be performed wholly within such
State.
[Remainder of page intentionally left blank]
-28-
IN WITNESS WHEREOF, the Company has caused this Security to be duly executed.
Dated: January 15, 2002
ARTESYN TECHNOLOGIES, INC.
By:_______________________
Name:_____________________
Title:____________________
SIGNATURE PAGE TO CONVERTIBLE NOTE
ELECTION OF HOLDER TO REQUIRE REPURCHASE
1. Pursuant to Section 3(a) of this Security, the undersigned hereby
elects to have all or a portion of this Security (in an amount not less than
$1,000,000) repurchased by the Company.
2. The undersigned hereby directs the Company to pay [choose one] (a) it
or (b) Name: __________________; address: __________________; Social Security or
Other Taxpayer Identification Number, if any: ____________, an amount in cash
equal to the Repurchase Price, as provided herein.
Dated: _______________________
HOLDER:______________________________
By:______________________________
Name:____________________________
Title:___________________________
Number of shares of Common Stock
owned by the holder and its affiliates: ___________________
Principal amount to be repurchased: _______________________
Remaining principal amount following
such repurchase: ______________________
NOTICE: The signature to the foregoing Election must correspond to the name as
written upon the face of this Security in every particular, without alteration
or any change whatsoever.
-2-
CONVERSION NOTICE
The undersigned holder of this Security hereby irrevocably exercises the
option to convert this Security, or any portion of the principal amount hereof
(in an amount not less than $1,000,000) below designated, into Common Stock in
accordance with the terms of this Security, and directs that such shares,
together with a check in payment for any fractional share and any Security
representing any unconverted principal amount hereof, be delivered to and be
registered in the name of the undersigned unless a different name has been
indicated below. If Common Stock or Securities are to be registered in the name
of a Person other than the undersigned, the undersigned will pay all transfer
taxes payable with respect thereto.
Dated: _______________________
HOLDER:____________________________
By:_____________________________
Name:___________________________
Title:__________________________
If shares or Securities are to be registered in the name of a Person other than
the holder, please print such Person's name and address:
_________________________
Name
_________________________
Address
_________________________
Social Security or other Taxpayer Identification Number, if any
If only a portion of the Securities is to be converted, please indicate:
1. Principal amount to be converted: $___________
2. Principal amount of Security representing unconverted principal amount to be
issued:
Amount: $________
-3-
