EXHIBIT 4.3
GATX CORPORATION,
AS ISSUER
GATX FINANCIAL CORPORATION,
AS GUARANTOR
AND
----------
JPMORGAN CHASE BANK,
AS TRUSTEE
----------
$125,000,000
5% SENIOR CONVERTIBLE NOTES DUE 2023
----------
INDENTURE
DATED AS OF AUGUST 15, 2003
TABLE OF CONTENTS
PAGE
ARTICLE 1 DEFINITIONS.............................................................................1
SECTION 1.1 Definitions.......................................................................1
SECTION 1.2 Other Definitions.................................................................7
SECTION 1.3 Incorporation by Reference of Trust Indenture Act.................................8
SECTION 1.4 Rules of Construction.............................................................8
ARTICLE 2 THE CONVERTIBLE NOTES...................................................................8
SECTION 2.1 Form and Dating...................................................................8
SECTION 2.2 Execution and Authentication.....................................................10
SECTION 2.3 Registrar, Paying Agent and Conversion Agent.....................................10
SECTION 2.4 Paying Agent To Hold Money in Trust..............................................11
SECTION 2.5 Holder Lists.....................................................................11
SECTION 2.6 Transfer and Exchange............................................................11
SECTION 2.7 Replacement Convertible Notes....................................................13
SECTION 2.8 Outstanding Convertible Notes....................................................14
SECTION 2.9 When Convertible Notes Owned by the Company or an Affiliate Are
Disregarded......................................................................14
SECTION 2.10 Temporary Convertible Notes......................................................15
SECTION 2.11 Cancellation.....................................................................15
SECTION 2.12 Defaulted Interest...............................................................16
SECTION 2.13 CUSIP Number.....................................................................16
SECTION 2.14 Regulation S.....................................................................16
ARTICLE 3 REDEMPTION.............................................................................16
SECTION 3.1 The Company's Right to Redeem; Notice to Trustee.................................16
SECTION 3.2 Selection of Convertible Notes to Be Redeemed....................................17
SECTION 3.3 Notice of Redemption.............................................................17
SECTION 3.4 Effect of Notice of Redemption...................................................18
SECTION 3.5 Deposit of Redemption Price......................................................18
SECTION 3.6 Convertible Notes Redeemed in Part...............................................19
SECTION 3.7 Repayment to the Company.........................................................19
ARTICLE 4 REPURCHASE OF Convertible Notes AT THE OPTION OF HOLDERS ON SPECIFIC DATES.............19
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TABLE OF CONTENTS
(continued)
SECTION 4.1 Optional Put.....................................................................19
SECTION 4.2 Notice of Repurchase Right.......................................................20
SECTION 4.3 Repurchase Notice; Repurchase Procedure..........................................21
SECTION 4.4 The Company's Right to Elect Manner of Payment of Repurchase Price...............22
SECTION 4.5 Effect of Repurchase Notice......................................................25
SECTION 4.6 Deposit of Repurchase Price......................................................25
SECTION 4.7 Convertible Notes Repurchased in Part............................................26
SECTION 4.8 No Purchase If Event of Default Has Occurred.....................................26
SECTION 4.9 Compliance with Applicable Law in Connection with Repurchase of
Convertible Notes................................................................26
SECTION 4.10 Repayment to the Company.........................................................27
ARTICLE 5 REPURCHASE OF CONVERTIBLE NOTES UPON FUNDAMENTAL CHANGE................................27
SECTION 5.1 Fundamental Change Put...........................................................27
SECTION 5.2 Notice of Fundamental Change.....................................................27
SECTION 5.3 Deposit of Fundamental Change Payment............................................29
SECTION 5.4 Supplemental Indenture Following Fundamental Change..............................29
SECTION 5.5 No Purchase Following Fundamental Change If Event of Default Has Occurred........29
SECTION 5.6 Compliance with Applicable Law in Connection with Fundamental Change Offer.......30
ARTICLE 6 CONTINGENT INTEREST....................................................................30
SECTION 6.1 Contingent Interest..............................................................30
SECTION 6.2 Payment of Contingent Interest...................................................30
SECTION 6.3 Contingent Interest Notification.................................................30
ARTICLE 7 COVENANTS..............................................................................31
SECTION 7.1 Payment of Convertible Notes.....................................................31
SECTION 7.2 Rule 144A Information; Periodic Reports to the Trustee...........................31
SECTION 7.3 Compliance Certificate...........................................................32
SECTION 7.4 Maintenance of Office or Agency..................................................32
SECTION 7.5 Continued Existence..............................................................32
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TABLE OF CONTENTS
(continued)
SECTION 7.6 Appointments to Fill Vacancies in Trustee's Office...............................32
SECTION 7.7 Stay, Extension and Usury Laws...................................................32
SECTION 7.8 Taxes............................................................................33
SECTION 7.9 Investment Company Act...........................................................33
SECTION 7.10 Contingent Debt Tax Treatment....................................................33
SECTION 7.11 Calculation of Original Issue Discount...........................................34
ARTICLE 8 SUCCESSORS.............................................................................34
SECTION 8.1 When the Company May Merge, Etc..................................................34
SECTION 8.2 Successor Corporation Substituted................................................35
SECTION 8.3 Purchase Option on Fundamental Change............................................35
ARTICLE 9 DEFAULTS AND REMEDIES..................................................................36
SECTION 9.1 Events of Default................................................................36
SECTION 9.2 Acceleration.....................................................................37
SECTION 9.3 Other Remedies...................................................................37
SECTION 9.4 Waiver of Past Defaults..........................................................38
SECTION 9.5 Control by Majority..............................................................38
SECTION 9.6 Limitation on Suits..............................................................38
SECTION 9.7 Rights of Holders To Receive Payment.............................................39
SECTION 9.8 Collection Suit by Trustee.......................................................39
SECTION 9.9 Trustee May File Proofs of Claim.................................................39
SECTION 9.10 Priorities.......................................................................40
SECTION 9.11 Undertaking for Costs............................................................40
ARTICLE 10 THE TRUSTEE............................................................................40
SECTION 10.1 Duties of the Trustee............................................................41
SECTION 10.2 Rights of the Trustee............................................................42
SECTION 10.3 Individual Rights of the Trustee.................................................43
SECTION 10.4 Trustee's Disclaimer.............................................................43
SECTION 10.5 Notice of Defaults...............................................................43
SECTION 10.6 Reports by the Trustee to Holders................................................44
SECTION 10.7 Compensation and Indemnity.......................................................44
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TABLE OF CONTENTS
(continued)
SECTION 10.8 Replacement of the Trustee.......................................................45
SECTION 10.9 Successor Trustee by Merger, etc.................................................46
SECTION 10.10 Eligibility, Disqualification.................................................46
SECTION 10.11 Preferential Collection of Claims Against Company.............................46
ARTICLE 11 SATISFACTION AND DISCHARGE OF INDENTURE................................................46
SECTION 11.1 Discharge of Indenture...........................................................46
SECTION 11.2 Deposited Monies to Be Held in Trust by Trustee..................................47
SECTION 11.3 Paying Agent to Repay Monies Held................................................47
SECTION 11.4 Return of Unclaimed Monies.......................................................47
SECTION 11.5 Reinstatement....................................................................48
ARTICLE 12 AMENDMENTS.............................................................................48
SECTION 12.1 Without the Consent of Holders...................................................48
SECTION 12.2 With the Consent of Holders......................................................49
SECTION 12.3 Compliance with the Trust Indenture Act..........................................50
SECTION 12.4 Revocation and Effect of Consents................................................50
SECTION 12.5 Notation on or Exchange of Convertible Notes.....................................51
SECTION 12.6 Trustee Protected................................................................51
ARTICLE 13 GENERAL PROVISIONS.....................................................................51
SECTION 13.1 Trust Indenture Act Controls.....................................................51
SECTION 13.2 Notices..........................................................................52
SECTION 13.3 Communication by Holders with Other Holders......................................52
SECTION 13.4 Certificate and Opinion as to Conditions Precedent...............................52
SECTION 13.5 Statements Required in Certificate or Opinion....................................53
SECTION 13.6 Rules by Trustee and Agents......................................................54
SECTION 13.7 Legal Holidays...................................................................54
SECTION 13.8 No Recourse Against Others.......................................................54
SECTION 13.9 Counterparts.....................................................................54
SECTION 13.10 Other Provisions.................................................................54
SECTION 13.11 Governing Law....................................................................55
SECTION 13.12 No Adverse Interpretation of Other Agreements....................................55
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TABLE OF CONTENTS
(continued)
SECTION 13.13 Successors.......................................................................55
SECTION 13.14 Severability.....................................................................55
SECTION 13.15 Table of Contents, Headings, etc.................................................56
ARTICLE 14 CONVERSION OF CONVERTIBLE NOTES........................................................56
SECTION 14.1 Right to Convert.................................................................56
SECTION 14.2 Exercise of Conversion Privilege; Issuance of Common Stock on Conversion;
No Adjustment for Interest or Dividends..........................................58
SECTION 14.3 Cash Payments in Lieu of Fractional Shares.......................................60
SECTION 14.4 Conversion Price.................................................................60
SECTION 14.5 Adjustment of Conversion Price...................................................60
SECTION 14.6 Effect of Reclassification, Consolidation, Merger or Sale........................68
SECTION 14.7 Taxes on Shares Issued...........................................................69
SECTION 14.8 Reservation of Shares; Shares to Be Fully Paid; Listing of Common Stock..........69
SECTION 14.9 Responsibility of Trustee........................................................69
SECTION 14.10 Notice to Holders Prior to Certain Actions.......................................70
SECTION 14.11 Restriction on Common Stock Issuable Upon Conversion.............................71
ARTICLE 15 GUARANTEE..............................................................................72
SECTION 15.1 Terms of the Guarantee...........................................................72
SECTION 15.2 Limitation of the Guarantor's Liability..........................................73
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CROSS-REFERENCE TABLE*
Trust Indenture Indenture
Act Section Section
------------------ ---------
310(a)(1).................................................. 10.10
(a)(2)............................................... 10.10, 13.10
(a)(3)............................................... n/a
(a)(4)............................................... n/a
(a)(5)............................................... n/a
(b).................................................. 10.8, 10.10, 13.2
(c).................................................. n/a
311(a)..................................................... 10.11
(b).................................................. 10.11
(c).................................................. n/a
312(a)..................................................... 2.5
(b).................................................. 13.3
(c).................................................. 13.3
313(a)..................................................... 10.6
(b)(1)............................................... n/a
(b)(2)............................................... 10.6
(c).................................................. 10.6, 13.2
(d).................................................. 10.6
314(a)..................................................... 7.2, 13.2
(b).................................................. n/a
(c)(1)............................................... 13.4
(c)(2)............................................... 13.4
(c)(3)............................................... n/a
(d).................................................. n/a
(e).................................................. 13.5
(f).................................................. n/a
315(a)..................................................... 10.1(b)
(b).................................................. 10.5, 13.2
(c).................................................. 10.1(a)
(d).................................................. 10.1(c)
(e).................................................. 9.11
316(a)(last sentence)...................................... 2.9
(a)(1)(A)............................................ 9.5
(a)(1)(B)............................................ 9.4
(a)(2)............................................... n/a
(b).................................................. 9.2
(c).................................................. 12.4
317(a)(1).................................................. 9.8
(a)(2)............................................... 9.9
(b).................................................. 2.4
318(a)..................................................... 13.1
(b).................................................. n/a
(c).................................................. 13.1
----------
"n/a" means not applicable.
*This Cross-Reference Table shall not, for any purpose, be deemed to be a part
of the Indenture.
-vi-
THIS INDENTURE, dated as of August 15, 2003, is by and among
GATX
Corporation, a
New York corporation (the "Company"), GATX Financial Corporation,
a Delaware corporation (the "Guarantor"), and JPMorgan Chase Bank, a
New York
banking corporation (the "Trustee"). The Company has duly authorized the
creation of its 5% Senior Convertible Notes due 2023 (the "Convertible Notes"),
and to provide therefor the Company, the Guarantor and the Trustee have duly
authorized the execution and delivery of this Indenture. Each party agrees as
follows for the benefit of the other parties and for the equal and ratable
benefit of the holders from time to time of the Convertible Notes:
ARTICLE 1
DEFINITIONS
SECTION 1.1 Definitions.
"Affiliate" means, when used with reference to any person, any other
person directly or indirectly controlling, controlled by, or under direct or
indirect common control with, such person. For the purposes of this definition,
"control" when used with respect to any specified person means the power to
direct or cause the direction of management or policies of the referent person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise. The terms "controlling" and "controlled" have meanings
correlative of the foregoing.
"Agent" means any Registrar, Paying Agent, Conversion Agent or co-
registrar.
"Agent Member" means any member of, or participant in, the Depositary.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Global Security to the extent
applicable to such transaction and as in effect from time to time.
"Bid Solicitation Agent" means the person selected by the Company to
solicit market bid quotations for the Convertible Notes, which initially shall
be the Trustee, and in no event shall it be an Affiliate of the Company.
"Board of Directors" means the Board of Directors of the Company or the
Guarantor, as the case may be, or in either case, any duly authorized committee
of the Board of Directors.
"Capital Stock" of any person means any and all shares, interests,
rights to purchase, warrants, options, participations or other equivalents of or
interests in (however designated) equity of such person, but excluding any debt
securities convertible into such equity.
"Change of Control" means the occurrence of one or more of the
following events: (a) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial
owner" (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of shares
representing more than 50% of the combined voting power of the then outstanding
Voting Stock of the Company, (b) the Company consolidates with or merges into
any other person (other than a subsidiary of the Company), or any other person
(other than a subsidiary of the Company) consolidates with or merges into the
Company, (c) the Company or
the Company and its subsidiaries, taken as a whole, sells, conveys, transfers or
leases its properties and assets substantially as an entirety to any person
(other than to one or more wholly-owned subsidiaries of the Company); provided,
that a Change of Control under (a), (b) and (c) above shall not be deemed to
have occurred if (x) at least 90% of the aggregate fair market value (as
determined by the Company's Board of Directors) of the property and securities
received by holders of the Common Stock (excluding cash payments for fractional
shares) in the transaction or transactions constituting the Change of Control
consists of shares of voting common stock of the surviving person (or its
parent) that are, or upon issuance will be, traded on a United States national
securities exchange or approved for trading on an established automated
over-the-counter trading market in the United States, or (y) the Sale Price of
the Company's Common Stock for any five Trading Days within the period of ten
consecutive Trading Days ending immediately after the Fundamental Change occurs
shall equal or exceed 110% of the Conversion Price in effect on such Trading
Day.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company
and which is not subject to redemption by the Company. Subject to the provisions
of Section 14.6, however, shares issuable on conversion of Convertible Notes
shall include only shares of the class designated as Common Stock of the Company
at the date of this Indenture or shares of any class or classes resulting from
any reclassification or reclassifications thereof and which have no preference
in respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Company and which are
not subject to redemption by the Company; provided that if at any time there
shall be more than one such resulting class, the shares of each such class then
so issuable shall be substantially in the proportion which the total number of
shares of such class resulting from all such reclassifications bears to the
total number of shares of all such classes resulting from all such
reclassifications.
"Company" means the party named as such above until a successor
replaces it in accordance with Article 8 and thereafter means the successor.
References to the Company shall not include any subsidiary of the Company.
"Contingent Interest" means interest that accrues and is payable as
provided in Article 6.
"Convertible Notes" means the 5% Senior Convertible Notes due 2023
issued, authenticated and delivered under this Indenture.
"Conversion Period" means the period from and including the eleventh
Trading Day in a calendar quarter up to, but not including, the eleventh Trading
Day of the following calendar quarter.
"Conversion Price" means the initial conversion price specified in the
form of Convertible Note in Paragraph 16 of such form, as adjusted in accordance
with the provisions of Article 14.
2
"Corporate Trust Office" means the corporate trust office of the
Trustee at which at any particular time the trust created by this Indenture
shall principally be administered; as of the date hereof, the Corporate Trust
Office is located at 000 Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx
00000.
"Default" means any event that is, or after notice or passage of time,
or both, would be, an Event of Default.
"Depositary" means, with respect to any Global Securities, a clearing
agency that is registered as such under the Exchange Act and is designated by
the Company to act as Depositary for such Global Securities (or any successor
securities clearing agency so registered), which shall initially be DTC.
"DTC" means The Depository Trust Company, a
New York corporation.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"Fundamental Change" means the occurrence of a Change of Control or a
Termination of Trading.
"GAAP" means generally accepted 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 or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession of the United States, which are in effect from time to time.
"Global Security" means a Convertible Note that is registered in the
Register.
"Global Securities Legend" means the legend labeled as such and that is
set forth in Exhibit A hereto.
"Guarantor" means the party named as such above and its successors and
assigns.
"Indenture" means this Indenture as amended or supplemented from time
to time.
"Initial Purchasers" means X.X. Xxxxxx Securities Inc., Citigroup
Global Markets Inc., Deutsche Bank Securities Inc., Xxxxxx Xxxxxxx Corp., Credit
Lyonnais Securities (USA) Inc. and Fleet Securities, Inc.
"Interest Payment Date" means February 15 and August 15 of each year.
"Issue Date" means the date on which Convertible Notes are first issued
and authenticated under this Indenture.
"Liquidated Damages" has the meaning specified in paragraph 17 of the
form of Convertible Note which is attached as Exhibit A hereto.
3
"Market Price" means the average of the Sale Prices of the Common Stock
for the twenty Trading Day period ending on the third business day prior to the
applicable Repurchase Date (if the third business day prior to the applicable
Repurchase Date is a Trading Day or, if not, then on the last Trading Day prior
to the third business day), appropriately adjusted to take into account the
occurrence, during the period commencing on the first of such Trading Days
during such twenty-Trading Day period and ending on such Repurchase Date, of
certain events that would result in an adjustment of the Conversion Price
pursuant to Section 14.5.
"Maturity Date" means August 15, 2023.
"Note Custodian" means JPMorgan Chase Bank, as custodian with respect
to any Global Security, or any successor entity thereto.
"Offering Memorandum" means the offering memorandum dated August 12,
2003, relating to the Convertible Notes, including all amendments thereto.
"Officer" means the Chairman of the Board, the Chief Executive Officer,
the President, the Chief Financial Officer, the Chief Accounting Officer, any
Executive Vice President, Senior Vice President or Vice President (whether or
not designated by a number or numbers or word or words before or after the title
"Vice President"), the Treasurer, the Secretary and any Assistant Treasurer or
any Assistant Secretary of the Company or the Guarantor, as the case may be.
"Officers' Certificate" means a certificate signed by any two of the
following Officers of the Company or the Guarantor, as the case may be: the
Chairman of the Board, the Chief Executive Officer, the President, the Chief
Financial Officer, a Vice President, the Treasurer, the Controller, the
Secretary or an Assistant Secretary and delivered to the Trustee. One of the
officers giving an Officers' Certificate given pursuant to Section 7.3 shall be
the principal executive, financial or accounting officer of the Company.
"Opinion of Counsel" means a written opinion from legal counsel, who
may be an employee of or counsel to the Company, the Guarantor or the Trustee
except to the extent otherwise indicated in this Indenture, and shall be
reasonably acceptable to the Trustee.
A "person" means any individual, corporation, partnership, joint
venture, trust, estate, unincorporated organization, limited liability company
or government or any agency or political subdivision thereof.
"Redemption Date" means, when used with respect to any Convertible Note
to be redeemed, the date fixed for redemption pursuant to the Indenture.
"Registration Agreement" means the Registration Rights Agreement
relating to the Convertible Notes and Common Stock issuable upon conversion of
such Convertible Notes dated as of August 15, 2003, by and among the Company,
the Guarantor and the Initial Purchasers, as such agreement may be amended,
modified or supplemented from time to time.
"Regular Record Date" means the February 1 or August 1 immediately
preceding each Interest Payment Date.
4
"Restricted Common Stock Legend" means the legend labeled as such and
that is set forth in Exhibit B hereto.
"Restricted Securities Legend" means the legend labeled as such and
that is set forth in Exhibit A hereto.
"Sale Price" of the Common Stock on any date means the closing sale
price per share (or, if no closing sale price is reported, the average of the
bid and ask prices or, if more than one in either case, the average of the
average bid and average ask prices) on such date as reported in the composite
transactions for the principal United States securities exchange on which the
Common Stock is traded or, if the Common Stock is not listed on a United States
national or regional securities exchange, as reported on the Nasdaq Stock
Market. If the Common Stock is not listed for trading on a United States
national or regional securities exchange and not reported on the Nasdaq Stock
Market on the relevant date, the Sale Price shall be the last quoted bid price
for the Common Stock in the over-the-counter market on the relevant date as
reported by the National Quotation Bureau or similar organization. If the bid
price is not available, the Sale Price shall be the market value for the Common
Stock on the relevant date as determined by a nationally recognized independent
investment banking firm retained by the Company for this purpose. The Sale Price
as determined above shall be appropriately adjusted to take into account the
occurrence of any event that would result in an adjustment of the Conversion
Price.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Shelf Registration Statement" shall have the meaning set forth in the
Registration Agreement.
A "subsidiary" means, with respect to any person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
person or one or more of the other subsidiaries of that person (or a combination
thereof) and (ii) any partnership (a) the sole general partner or managing
general partner of which is such person or a subsidiary of such person or (b)
the only general partners of which are such person or of one or more
subsidiaries of such person (or any combination thereof).
"Termination of Trading" will be deemed to have occurred if the Common
Stock (or other common stock into which the Convertible Notes are then
convertible) is neither listed for trading on the
New York Stock Exchange nor
approved for trading on the Nasdaq National Market.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code Sections
77aaa- 77bbbb) as in effect on the date of execution of this Indenture, except
as provided in Sections 12.3 and 14.6.
"Trading Day" shall mean (x) if the applicable security is listed or
admitted for trading on the
New York Stock Exchange or another national
securities exchange, a day on which the
New York Stock Exchange or such other
national securities exchange is open for business or (y) if the applicable
security is quoted on the Nasdaq National Market, a day on which trades may be
5
made thereon or (z) if the applicable security is not so listed, admitted for
trading or quoted, any day other than a Saturday or Sunday or a day on which
banking institutions in the State of
New York are authorized or obligated by law
or executive order to close.
"Trading Price" means, as of any date of determination, the average of
the secondary market bid quotations per $1,000 principal amount of Convertible
Notes obtained by the Bid Solicitation Agent for $5,000,000 principal amount of
Convertible Notes at approximately 4:00 p.m.,
New York City time, on such date
of determination from three nationally recognized securities dealers (none of
which shall be an Affiliate of the Company) selected by the Company, provided,
that if at least three such bids cannot be reasonably obtained by the Bid
Solicitation Agent, but two bids are obtained, then the average of the two bids
shall be used, and if only one such bid can be reasonably obtained by the Bid
Solicitation Agent, this one bid shall be used; provided, however, if (i) the
Bid Solicitation Agent, through the exercise of reasonable efforts, is unable to
obtain at least one bid from a securities dealer, or (ii) in the Company's
reasonable judgment, the bid quotations are not indicative of the secondary
market value of the Convertible Notes as of such date of determination, then the
Trading Price of a Convertible Note for such date of determination shall equal
(x) the average of the Sale Prices of a share of Common Stock for the five
Trading Day period ending on such date of determination multiplied by the number
of shares of Common Stock the holder would otherwise be entitled to receive upon
conversion or (y) an amount determined by another method selected by the Company
in its reasonable judgment.
"Trustee" means the party named as such above until a successor
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor.
"Trust Officer" means an officer in the Corporate Trust Office of the
Trustee and having direct responsibility for the administration of this
Indenture.
"U.S. Government Obligations" means direct obligation of the United
States of America for the payment of which the full faith and credit of the
United States of America is pledged. In order to have money available on a
payment date to pay principal or interest on the Convertible Notes, the U.S.
Government Obligations shall be payable as to principal or interest on or before
such payment date in such amounts as will provide the necessary money. U.S.
Government Obligations shall not be callable at the issuer's option.
"Voting Stock" of a corporation means all classes of Capital Stock of
such corporation then outstanding and normally entitled to vote in the election
of directors.
6
SECTION 1.2 Other Definitions.
Defined in Section
"Bankruptcy Law" 9.1
"business day" 13.7
"Clearstream" 2.1
"closing price" 14.5
"Contingent Interest Payment Date" 6.2
"Contingent Interest Period" 6.1
"Conversion Agent" 2.3
"Conversion Date" 14.2
"Conversion Value" 14.1
"Current Dividend Rate" 14.5
"Current Market Price" 14.5
"Custodian" 9.1
"Euroclear" 2.1
"Event of Default" 9.1
"Excess Amount Per Share" 14.5
"Expiration Date" 14.5
"fair market value" 14.5
"Fundamental Change Date" 5.1
"Fundamental Change Expiration Date" 5.2
"Fundamental Change Offer" 5.1
"Fundamental Change Payment" 5.1
"Indemnitees" 10.7
"Investment Company Act" 7.9
"Legal Holiday" 13.7
"Losses" 10.7
"Paying Agent" 2.3
"Prior Dividend Rate" 14.5
"Purchase Agreement 2.1
"QIB" 2.1
"Record Date" 14.5
"Redemption Price" 3.1
"Register" 2.3
"Registrar" 2.3
"Regulation S" 2.1
"Repurchase Date" 4.1
"Repurchase Price" 4.1
"Repurchase Notice" 4.3
"Rule 144A" 2.1
"Securities" 14.5
"Trigger Event" 14.5
7
SECTION 1.3 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"Commission" means the Commission;
"indenture securities" means the Convertible Notes;
"indenture security holder" means a holder of a Convertible
Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee; and
"obligor" on the Convertible Notes means the Company, the
Guarantor or any other obligor on the Convertible Notes.
All other terms in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by Commission rule under the TIA
have the meanings so assigned to them.
SECTION 1.4 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the
plural include the singular; and
(5) the male, female and neuter genders include one another.
ARTICLE 2
THE CONVERTIBLE NOTES
SECTION 2.1 Form and Dating.
(a) Global Securities. The Convertible Notes are being offered and sold
by the Company pursuant to a Purchase Agreement relating to the Convertible
Notes, dated August 12, 2003, among the Company, the Guarantor and the Initial
Purchasers (the "Purchase Agreement").
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The Convertible Notes are being offered and sold (i) in reliance on
Regulation S under the Securities Act ("Regulation S") or (ii) to "qualified
institutional buyers" as defined in Rule 144A ("QIBs") in reliance on Rule 144A
under the Securities Act ("Rule 144A"), each as provided in the Purchase
Agreement, and shall be issued in the form of one or more permanent global
securities in definitive, fully registered form without interest coupons with
the Global Securities Legend and Restricted Securities Legend set forth in
Exhibit A hereto (each, a "Global Security"). Any Global Security shall be
deposited on behalf of the purchasers of the Convertible Notes represented
thereby with the Trustee, as custodian for the Depositary, and registered in the
name of the Depositary or a nominee of the Depositary for the accounts of
participants in the Depositary (and, in the case of Convertible Notes held in
accordance with Regulation S, registered with the Depositary for the accounts of
designated agents holding on behalf of the Euroclear System ("Euroclear") or
Clearstream Banking, societe anonyme ("Clearstream")), duly executed by the
Company and authenticated by the Trustee as hereinafter provided. The aggregate
principal amount of a Global Security may from time to time be increased or
decreased by adjustments made on the records of the Trustee and the Depositary
or its nominee as hereinafter provided.
(b) Book-Entry Provisions. This Section 2.1(b) shall apply only to a
Global Security deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.1(b) and the written order of the Company, authenticate and
deliver initially one or more Global Securities that (i) shall be registered in
the name of Cede & Co. or other nominee of such Depositary and (ii) shall be
delivered by the Trustee to such Depositary or pursuant to such Depositary's
instructions or held by the Trustee as custodian for the Depositary pursuant to
a FAST Balance Certificate Agreement between the Depositary and the Trustee.
Agent Members shall have no rights under this Indenture with respect to
any Global Security held on their behalf by the Depositary or by the Trustee as
the custodian of the Depositary or under such Global Security, and the
Depositary may be treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute owner of such Global Security for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent
the Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or impair, as between the Depositary and its Agent Members, the
operation of customary practices of such Depositary governing the exercise of
the rights of a holder of a beneficial interest in any Global Security.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "Management
Regulations and Instructions to Participants" of Clearstream shall be applicable
to interests in any Global Securities that are held by participants through
Euroclear or Clearstream. The Trustee shall have no obligation to notify holders
of any such procedures or to monitor or enforce compliance with the same.
9
(c) Definitive Securities. Except as provided in Section 2.10, owners
of beneficial interests in Global Securities will not be entitled to receive
physical delivery of certificated Convertible Notes in definitive form. If
applicable, certificated Convertible Notes in definitive form will bear the
Restricted Securities Legend set forth on Exhibit A unless removed in accordance
with Section 2.6(c).
SECTION 2.2 Execution and Authentication.
One Officer shall sign the Convertible Notes for the Company by manual
or facsimile signature.
If an Officer whose signature is on a Convertible Note no longer holds
that office at the time the Convertible Note is authenticated, the Convertible
Note shall nevertheless be valid.
A Convertible Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Convertible Note has been authenticated under this Indenture.
Upon a written order of the Company signed by an Officer of the
Company, the Trustee shall authenticate Convertible Notes for original issue in
an aggregate principal amount of $125,000,000 to the Initial Purchasers. The
aggregate principal amount of Convertible Notes outstanding at any time may not
exceed that amount except as provided in Section 2.7.
The Convertible Notes shall be issuable only in registered form without
coupons and only in denominations of $1,000 or any integral multiple thereof.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Convertible Notes. An authenticating agent may
authenticate Convertible Notes whenever the Trustee may do so. Each reference in
this Indenture to authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same right as an Agent to deal with the
Company or an Affiliate of the Company.
SECTION 2.3 Registrar, Paying Agent and Conversion Agent.
The Company shall maintain or cause to be maintained in such locations
as it shall determine, which may be the Corporate Trust Office, an office or
agency: (i) where securities may be presented for registration of transfer or
for exchange ("Registrar"); (ii) where Convertible Notes may be presented for
payment ("Paying Agent"); (iii) where Convertible Notes may be presented for
conversion (the "Conversion Agent"); and (iv) where notices and demands to or
upon the Company or the Guarantor in respect of Convertible Notes and this
Indenture may be served by the holders of the Convertible Notes. The Registrar
shall keep a register ("Register") of the Convertible Notes and of their
transfer and exchange. The Company may appoint one or more co-registrars, one or
more additional paying agents and one or more additional conversion agents. The
term "Paying Agent" includes any additional paying agent, and the term
"Conversion Agent" includes any additional Conversion Agent. The Company may
change any Agent without prior notice. The Company shall notify the Trustee of
the name and address of any Agent not a party to this Indenture and shall enter
into an appropriate agency agreement with any Agent not a party to this
Indenture. The agreement shall implement the
10
provisions of this Indenture that relate to such Agent. The Company or any of
its subsidiaries may act as Paying Agent, Registrar, Conversion Agent or
co-registrar, except that for purposes of Articles 5 or 11, neither the Company
nor any of its subsidiaries shall act as Paying Agent. If the Company fails to
appoint or maintain another entity as Registrar, or Paying Agent or Conversion
Agent, the Trustee shall act as such, and the Trustee shall initially act as
such.
SECTION 2.4 Paying Agent To Hold Money in Trust.
The Company shall require each Paying Agent (other than the Trustee,
who hereby so agrees), to agree in writing that the Paying Agent will hold in
trust for the benefit of holders of the Convertible Notes or the Trustee all
money held by the Paying Agent for the payment of principal or interest
(including Liquidated Damages) on the Convertible Notes, and will notify the
Trustee of any default by the Company in respect of making any such payment.
While any such default continues, the Trustee may require a Paying Agent to pay
all money held by it to the Trustee. The Company at any time may require a
Paying Agent to pay all money held by it to the Trustee. Upon payment over to
the Trustee, the Paying Agent (if other than the Company or a subsidiary of the
Company) shall have no further liability for the money. If the Company or a
subsidiary of the Company acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the holders of the Convertible Notes all
money held by it as Paying Agent. In the absence of a written request from the
Company or the Guarantor to return unclaimed funds to the Company or the
Guarantor, as the case may be, the Trustee shall from time to time deliver all
unclaimed funds held by it in any capacity hereunder to or as directed by
applicable escheat authorities, as determined by the Trustee in its sole
discretion, in accordance with the customary practices and procedures of the
Trustee. Any unclaimed funds held by the Trustee in any capacity hereunder
pursuant to this Section 2.4 shall be held uninvested and without any liability
for interest.
SECTION 2.5 Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
holders of Convertible Notes and shall otherwise comply with TIA Section 312(a).
If the Trustee is not the Registrar, the Company shall furnish to the Trustee at
least seven business days before each Interest Payment Date, and as the Trustee
may request in writing within fifteen (15) days after receipt by the Company of
any such request (or such lesser time as the Trustee may reasonably request in
order to enable it to timely provide any notice to be provided by it hereunder),
a list in such form and as of such date as the Trustee may reasonably require of
the names and addresses of holders of Convertible Notes.
SECTION 2.6 Transfer and Exchange.
(a) When Convertible Notes are presented to the Registrar or a
co-registrar with a request to register a transfer or to exchange them for an
equal principal amount of Convertible Notes for other denominations, the
Registrar shall register the transfer or make the exchange if its requirements
for such transactions are met. To permit registrations of transfers and
exchanges, the Company shall issue, and the Trustee shall authenticate,
Convertible Notes at the Registrar's request, bearing registration numbers not
contemporaneously outstanding. No service charge shall be made to a holder for
any registration of transfer or exchange (except as otherwise
11
expressly permitted herein), but the Company and the Registrar may require
payment of a sum sufficient to cover any transfer tax or other governmental
charge payable upon exchanges pursuant to Sections 2.7, 12.5 or 14.2.
In the event of any redemption of the Convertible Notes in part, the
Company shall not be required (i) to issue, register the transfer of or exchange
Convertible Notes during a period beginning at the opening of business 15 days
before the selection of Convertible Notes for redemption under Section 3.2 and
ending at the close of business on the day of mailing of the notice of
redemption; or (ii) to register the transfer of or exchange of any Convertible
Note so selected for redemption, in whole or in part, except the unredeemed
portion of any Convertible Note being redeemed in part.
The Company or the Registrar shall not be required to register the
transfer of any Convertible Notes surrendered for repurchase pursuant to
Articles 4 or 5.
All Convertible Notes issued upon any transfer or exchange of
Convertible Notes in accordance with this Indenture shall be the valid
obligations of the Company, evidencing the same debt, and entitled to the same
benefits under this Indenture as the Convertible Notes surrendered upon such
registration of transfer or exchange.
(b) Notwithstanding any provision to the contrary herein, so long as a
Global Security remains outstanding and is held by or on behalf of the
Depositary, transfers of a Global Security, in whole or in part, or of any
beneficial interest therein, shall only be made in accordance with Sections
2.1(b) and 2.10; provided, however, that beneficial interests in a Global
Security may be transferred to persons who take delivery thereof in the form of
a beneficial interest in the Global Security in accordance with the transfer
restrictions set forth under the heading "Notice to Investors" in the Offering
Memorandum and, if applicable, in the Restricted Securities Legend.
Except for transfers or exchanges made in accordance with Section 2.10,
transfers of a Global Security shall be limited to transfers of such Global
Security in whole, but not in part, to nominees of the Depositary or to a
successor of the Depositary or such successor's nominee.
In the event that a Global Security is exchanged for Convertible Notes
in definitive form pursuant to Section 2.10 prior to the effectiveness of a
Shelf Registration Statement with respect to such Convertible Notes, such
exchange may occur, and such Convertible Notes may be further exchanged or
transferred, only upon receipt by the Registrar of (1) such Global Security or
such Convertible Notes in definitive form, duly endorsed as provided herein, as
applicable, (2) instructions from the holder directing the Trustee to
authenticate and deliver one or more Convertible Notes in definitive form of the
same aggregate principal amount as the Global Security or the Convertible Notes
in definitive form (or portion thereof), as applicable, to be transferred, such
instructions to contain the name or names of the designated transferee or
transferees, the authorized denomination or denominations of the Convertible
Notes in definitive form to be so issued and appropriate delivery instructions,
and (3) such certifications or other information and, in the case of transfers
pursuant to Rule 144 under the Securities Act, legal opinions as the Company may
reasonably require to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act (including the certification requirements
intended to ensure that such transfers
12
comply with Rule 144A or Regulation S under the Securities Act, as the case may
be), and upon compliance with such other procedures as may from time to time be
adopted by the Company and the Registrar.
(c) Except in connection with a Shelf Registration Statement
contemplated by and in accordance with the terms of the Registration Agreement,
if Convertible Notes are issued upon the registration of transfer, exchange or
replacement of Convertible Notes bearing a Restricted Securities Legend, or if a
request is made to remove such a Restrictive Securities Legend on Convertible
Notes, the Convertible Notes so issued shall bear the Restricted Securities
Legend, or a Restricted Securities Legend shall not be removed, as the case may
be, unless there is delivered to the Company such satisfactory evidence, which,
in the case of a transfer made pursuant to Rule 144 under the Securities Act,
may include an opinion of counsel given in accordance with the laws in the State
of
New York, as may be reasonably required by the Company, that neither the
legend nor the restrictions on transfer set forth therein are required to ensure
that transfers thereof comply with the provisions of Rule 144A, Rule 144 or
Regulation S under the Securities Act or that such Convertible Notes are not
"restricted" within the meaning of Rule 144 under the Securities Act. Upon
provision to the Company of such satisfactory evidence, the Trustee, at the
written direction of the Company, shall authenticate and deliver Convertible
Notes that do not bear the legend. The Company shall not otherwise be entitled
to require the delivery of a legal opinion in connection with any transfer or
exchange of Securities.
(d) Neither the Trustee nor any Agent shall have any responsibility for
any actions taken or not taken by the Depositary.
(e) The Trustee shall have no obligation or duty to monitor, determine
or inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Convertible Notes (including any transfers between or among the
Depositary's participants or beneficial owners of interests in any Global
Security) other than to require delivery of such certificates and other
documentation as is expressly required by, and to do so if and when expressly
required by, the terms of this Indenture and to examine the same to determine
substantial compliance as to form with the express requirements hereof.
SECTION 2.7 Replacement Convertible Notes.
If the holder of a Convertible Note claims that its Convertible Note
has been lost, destroyed or wrongfully taken, the Company shall issue and the
Trustee shall authenticate a replacement Convertible Note if the Trustee's and
the Company's requirements are met. If required by the Trustee or the Company as
a condition of receiving a replacement Convertible Note, the holder of a
Convertible Note must provide a certificate of loss and an indemnity and/or an
indemnity bond sufficient, in the judgment of both the Company and the Trustee,
to fully protect the Company, the Trustee, any Agent and any authenticating
agent from any loss, liability, cost or expense which any of them may suffer or
incur if the Convertible Note is replaced. The Company and the Trustee may
charge the relevant holder for their expenses in replacing any Convertible Note.
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The Trustee or any authenticating agent may authenticate any such
substituted Convertible Note and deliver the same upon the receipt of such
security or indemnity as the Trustee, the Company and, if applicable, such
authenticating agent may require. Upon the issuance of any substituted
Convertible Note, the Company and the Trustee may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses connected therewith. In case any
Convertible Note, which has matured or is about to mature, or which has been
submitted for repurchase pursuant to Articles 4 or 5 or is about to be converted
into Common Stock pursuant to Article 14, shall become mutilated or be
destroyed, lost or stolen, the Company may, instead of issuing a substitute
Convertible Note, pay or authorize the payment of or convert or authorize the
conversion of the same (without surrender thereof except in the case of a
mutilated Convertible Note), as the case may be, if the applicant for such
payment or conversion shall furnish to the Company, to the Trustee and, if
applicable, to the authenticating agent such security or indemnity as may be
required by them to save each of them harmless for any loss, liability, cost or
expense caused by or connected with such substitution, and, in case of
destruction, loss or theft, evidence satisfactory to the Company, the Trustee
and, if applicable, any paying agent or conversion agent of the destruction,
loss or theft of such Convertible Note and of the ownership thereof.
Every replacement Convertible Note is an additional obligation of the
Company and shall be entitled to all the benefits provided under this Indenture
equally and proportionately with all other Convertible Notes duly issued,
authenticated and delivered hereunder.
SECTION 2.8 Outstanding Convertible Notes.
The Convertible Notes outstanding at any time are all the Convertible
Notes properly authenticated by the Trustee except for those canceled by the
Trustee, those delivered to it for cancellation, and those described in this
Section as not outstanding.
If a Convertible Note is replaced pursuant to Section 2.7, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Convertible Note is held by a bona fide purchaser.
If Convertible Notes are considered purchased under Articles 4 or 5,
paid under Section 7.1 or converted under Article 14, they cease to be
outstanding, and interest (including Contingent Interest, if any) and Liquidated
Damages, if any, on them ceases to accrue.
Subject to Section 2.9 hereof, a Convertible Note does not cease to be
outstanding because the Company or an Affiliate of the Company holds the
Convertible Note.
SECTION 2.9 When Convertible Notes Owned by the Company or an Affiliate Are
Disregarded.
In determining whether the holders of the required principal amount of
Convertible Notes have concurred in any direction, waiver or consent,
Convertible Notes owned by the Company or an Affiliate of the Company shall be
considered as though they are not outstanding except that for the purposes of
determining whether the Trustee shall be protected in relying on any such
14
direction, waiver or consent, only Convertible Notes which a Trust Officer of
the Trustee actually knows are so owned shall be so disregarded.
SECTION 2.10 Temporary Convertible Notes.
(a) Until definitive Convertible Notes are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Convertible
Notes. Temporary Convertible Notes shall be substantially in the form of
definitive Convertible Notes but may have variations that the Company considers
appropriate for temporary Convertible Notes and shall be reasonably acceptable
to the Trustee. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate definitive Convertible Notes in exchange for
temporary Convertible Notes.
(b) A Global Security deposited with the Depositary or with the Trustee
as custodian for the Depositary pursuant to Section 2.1 shall be transferred to
the beneficial owners thereof in the form of certificated Convertible Notes in
definitive form only if such transfer complies with Section 2.6 and (i) the
Depositary notifies the Company that it is unwilling or unable to continue as
Depositary for such Global Security or if at any time such Depositary ceases to
be a "clearing agency" registered under the Exchange Act and a successor
Depositary is not appointed by the Company within 90 days of such notice, or
(ii) an Event of Default has occurred and is continuing.
(c) Any Global Security or interest therein that is transferable to the
beneficial owners thereof in the form of certificated Convertible Notes in
definitive form shall, if held by the Depository, be surrendered by the
Depositary to the Trustee, without charge, and the Trustee shall authenticate
and deliver, upon such transfer of each portion of such Global Security, an
equal aggregate principal amount of Convertible Notes of authorized
denominations in the form of certificated Convertible Notes in definitive form.
Any portion of a Global Security transferred pursuant to this Section shall be
executed, authenticated and delivered only in denominations of $1,000 and any
integral multiple thereof and registered in such names as the Depositary shall
direct. Any Convertible Notes in the form of certificated Convertible Notes in
definitive form delivered in exchange for an interest in the Global Security
shall, except as otherwise provided by Section 2.6(c), bear the Restricted
Securities Legend set forth in Exhibit A hereto.
(d) Prior to any transfer pursuant to Section 2.10(b), the registered
holder of a Global Security may grant proxies and otherwise authorize any
person, including Agent Members and persons that may hold interests through
Agent Members, to take any action which a holder is entitled to take under this
Indenture or the Convertible Notes.
SECTION 2.11 Cancellation.
The Company at any time may deliver Convertible Notes to the Trustee
for cancellation. The Registrar and Paying Agent shall forward to the Trustee
any Convertible Notes surrendered to them for registration of transfer,
exchange, payment, replacement, conversion, repurchase or cancellation. The
Trustee and no one else may cancel Convertible Notes surrendered for
registration of transfer, exchange, payment, replacement, conversion, repurchase
or cancellation. The Trustee shall dispose of canceled Convertible Notes in
accordance with its then customary
15
procedures, unless the Company shall otherwise direct in writing. The Company
may not issue new Convertible Notes to replace Convertible Notes that it has
paid or repurchased or that have been delivered to the Trustee for cancellation
or that any holder has (i) converted pursuant to Article 14 hereof or (ii)
submitted for repurchase pursuant to Articles 4 or 5 hereof (unless revoked).
SECTION 2.12 Defaulted Interest.
If the Company fails to make a payment of interest on the Convertible
Notes, it shall pay such defaulted interest plus, to the extent lawful, any
interest payable on the defaulted interest. It may pay such defaulted interest,
plus any such interest payable on it, to the persons who are holders of
Convertible Notes on a subsequent special record date. The Company shall fix any
such record date and payment date. At least 15 days before any such record date,
the Company shall mail to holders of the Convertible Notes a notice that states
the record date, payment date and amount of such interest to be paid.
SECTION 2.13 CUSIP Number.
The Company in issuing the Convertible Notes may use a "CUSIP" number,
and if so, such CUSIP number shall be included in notices of repurchase as a
convenience to holders of Convertible Notes; provided, however, that any such
notice may state that no representation is made as to the correctness or
accuracy of the CUSIP number printed in the notice or on the Convertible Notes
and that reliance may be placed only on the other identification numbers printed
on the Convertible Notes; and provided further that neither the Trustee nor any
Registrar shall have any liability as to the correctness or accuracy of any
CUSIP number so printed in the notice. The Company will promptly notify the
Trustee of any change in the CUSIP number.
SECTION 2.14 Regulation S.
The Company agrees that it will refuse to register any transfer of
Convertible Notes or any shares of Common Stock issued upon conversion of
Convertible Notes that is not made in accordance with the provisions of
Regulation S under the Securities Act, pursuant to a registration statement
which has been declared effective under the Securities Act or pursuant to an
available exemption from the registration requirements of the Securities Act;
provided that the provisions of this paragraph shall not be applicable to any
Convertible Notes which do not bear a Restricted Securities Legend or to any
shares of Common Stock evidenced by certificates which do not bear a Restricted
Common Stock Legend.
ARTICLE 3
REDEMPTION
SECTION 3.1 The Company's Right to Redeem; Notice to Trustee.
Prior to August 15, 2008, the Convertible Notes will not be redeemable
at the Company's option. Beginning on August 15, 2008, the Company, at its
option, may redeem the Convertible Notes for cash in accordance with this
Article 3 at any time as a whole, or from time to time in part, at a redemption
price equal to 100% of the principal amount of Convertible Notes to be
16
redeemed plus any accrued and unpaid interest (including Contingent Interest, if
any) and any accrued and unpaid Liquidated Damages, on those Convertible Notes
to, but not including, the Redemption Date (the "Redemption Price").
If the Company elects to redeem Convertible Notes, it shall notify the
Trustee in writing of the Redemption Date, the principal amount of Convertible
Notes to be redeemed and the Redemption Price. The Company shall give this
notice to the Trustee at least 45 days before the Redemption Date (unless a
shorter notice shall be satisfactory to the Trustee).
SECTION 3.2 Selection of Convertible Notes to Be Redeemed.
If fewer than all of the outstanding Convertible Notes are to be
redeemed, unless the procedures of the Depositary provide otherwise, the Trustee
shall select the Convertible Notes to be redeemed by lot, on a pro rata basis or
by another method the Trustee considers fair and appropriate. The Trustee shall
make the selection and notify the Company of such selection within five business
days after it receives the notice provided for in Section 3.1 from outstanding
Convertible Notes not previously called for redemption.
Convertible Notes and portions of Convertible Notes that the Trustee
selects shall be in principal amounts of $1,000 or a multiple of $1,000.
Provisions of this Indenture that apply to Convertible Notes called for
redemption also apply to portions of Convertible Notes called for redemption.
Convertible Notes and portions of Convertible Notes that are to be
redeemed are convertible by the holder until 5:00 p.m.,
New York City time, on
the second business day immediately preceding the Redemption Date. If any
Convertible Note selected for partial redemption is converted in part before
termination of the conversion right with respect to the portion of the
Convertible Note so selected, the converted portion of such Convertible Note
shall be deemed (so far as may be) to be from the portion selected for
redemption. Convertible Notes which have been converted during a selection of
Convertible Notes to be redeemed may be treated by the Trustee as outstanding
for the purpose of such selection.
SECTION 3.3 Notice of Redemption.
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first-class mail, postage
prepaid, to each holder of Convertible Notes to be redeemed at the address of
such holder appearing in the register of the Registrar. The notice of redemption
shall identify the Convertible Notes to be redeemed and shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) the Conversion Price;
(d) the name and address of the Paying Agent and Conversion Agent;
17
(e) that Convertible Notes called for redemption may be converted at
any time prior to 5:00 p.m., New York City time, on the second business day
preceding the Redemption Date;
(f) that holders who want to convert their Convertible Notes must
satisfy the requirements set forth in Article 14;
(g) that Convertible Notes called for redemption must be surrendered to
the Paying Agent to collect the Redemption Price;
(h) in the case of any Convertible Note redeemed in part, that the
holder of such Convertible Note will receive a new Convertible Note or
Convertible Notes, of authorized denominations for the principal amount thereof
remaining unredeemed;
(i) if fewer than all of the outstanding Convertible Notes are to be
redeemed, the certificate numbers, if any, and principal amounts of the
particular Convertible Notes to be redeemed;
(j) that, unless the Company defaults in making payment of such
Redemption Price, interest (including Contingent Interest, if any) and
Liquidated Damages, if any, on Convertible Notes called for redemption will
cease to accrue on and after the Redemption Date;
(k) the CUSIP number(s) of the Convertible Notes; and
(l) any other information the Company wants to present.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense; provided,
however, that the Company makes such request at least five business days (unless
a shorter period shall be satisfactory to the Trustee) prior to the date by
which such notice of redemption must be given to holders of Convertible Notes in
accordance with this Section 3.3; provided, further, that the text of the notice
of redemption shall be prepared by the Company.
SECTION 3.4 Effect of Notice of Redemption.
Once notice of redemption is given, Convertible Notes called for
redemption become due and payable on the Redemption Date and at the Redemption
Price, except for Convertible Notes which are converted in accordance with the
terms of this Indenture. Upon surrender to the Paying Agent, such Convertible
Notes shall be paid at the Redemption Price. A notice of redemption may not be
conditional.
SECTION 3.5 Deposit of Redemption Price.
Prior to 11:00 a.m., New York City time, on the applicable Redemption
Date, the Company shall deposit with the Paying Agent (or if the Company or a
subsidiary of the Company or an Affiliate of any of them is acting as the Paying
Agent, shall segregate and hold in trust as provided in Section 2.4) an amount
(in immediately available funds if deposited on the Redemption Date) sufficient
to pay the aggregate Redemption Price of all Convertible Notes or portions
thereof that are to be redeemed as of such Redemption Date other than
Convertible
18
Notes or portions of Convertible Notes called for redemption which on or prior
thereto have been delivered by the Company to the Trustee for cancellation or
have been converted.
If the Paying Agent holds, in accordance with the terms hereof, at
11:00 a.m., New York City time, on the applicable Redemption Date, cash
sufficient to pay the Redemption Price of any Convertible Notes for which notice
of redemption is given, then, on such Redemption Date, such Convertible Notes
will cease to be outstanding, and interest (including Contingent Interest, if
any) and Liquidated Damages, if any, on such Convertible Notes will cease to
accrue, whether or not such Convertible Notes are delivered to the Paying Agent,
and the rights of the holders in respect thereof shall terminate (other than the
right to receive the Redemption Price upon delivery of such Convertible Notes).
If any Convertible Note called for redemption shall not be so paid upon
surrender for redemption because of the Company's failure to comply with this
Article 3, interest shall be paid on the unpaid principal from the Redemption
Date until such principal is paid and, to the extent lawful, on any interest not
paid on such unpaid principal, in each case at the rate provided in Section 7.1.
SECTION 3.6 Convertible Notes Redeemed in Part.
Any certificated Convertible Note which is to be redeemed only in part
shall be surrendered at the office of the Paying Agent and the Company shall
execute and the Trustee shall authenticate and deliver to the holder of such
Convertible Note, without charge, a new Convertible Note or Convertible Notes,
of any authorized denomination as requested by such holder in aggregate
principal amount equal to the unredeemed portion of the Convertible Notes
surrendered.
SECTION 3.7 Repayment to the Company.
To the extent that the aggregate amount of cash deposited by the
Company pursuant to Section 3.5 exceeds the aggregate Redemption Price of the
Convertible Notes or portions thereof which the Company is redeeming as of the
Redemption Date, then, promptly after the Redemption Date, the Paying Agent
shall return any such excess cash to the Company.
ARTICLE 4
REPURCHASE OF CONVERTIBLE NOTES
AT THE OPTION OF HOLDERS
ON SPECIFIC DATES
SECTION 4.1 Optional Put.
Convertible Notes shall be repurchased by the Company, at the option of
the holder thereof, on August 15, 2008, August 15, 2013 and August 15, 2018
(each, a "Repurchase Date"), at a repurchase price equal to 100% of the
principal amount of those Convertible Notes plus any accrued and unpaid interest
(including Contingent Interest, if any) and any accrued and unpaid Liquidated
Damages to, but not including, such Repurchase Date (the "Repurchase Price"),
subject to satisfaction by or on behalf of the holder of the requirements set
forth in Section 4.3.
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SECTION 4.2 Notice of Repurchase Right.
No later than 20 business days prior to each Repurchase Date, the
Company shall mail a written notice of the repurchase right by first class mail
to the Trustee, and to each holder of Convertible Notes at the address of such
holder appearing in the register of the Registrar (and to beneficial owners as
required by applicable law). The notice shall include a form of Repurchase
Notice to be completed by the holder and shall briefly state, as applicable:
(a) the date by which the Repurchase Notice must be delivered to the
Paying Agent in order for a holder of Convertible Notes to exercise the
repurchase right, which shall be the last business day immediately preceding the
Repurchase Date;
(b) the Repurchase Date;
(c) the Repurchase Price;
(d) whether the Repurchase Price will be paid in cash or, if permitted
hereunder, in shares of Common Stock, or a combination thereof and, in the case
of a combination, the percentage of each;
(e) if the Company elects to pay the Repurchase Price in shares of
Common Stock or a combination of cash and shares of Common Stock, that the
number of shares of Common Stock each holder of Convertible Notes will receive
will equal the portion of the Repurchase Price to be paid in shares of Common
Stock divided by the Market Price of one share of Common Stock;
(f) if the Company elects to pay the Repurchase Price in shares of
Common Stock or a combination of cash and shares of Common Stock, the method of
calculating the Market Price of the shares of Common Stock;
(g) that because the Market Price of one share of Common Stock will be
determined prior to the Repurchase Date, holders of the Convertible Notes will
bear the market risk that the shares of Common Stock to be received will decline
in value between the date such Market Price is determined and the Repurchase
Date;
(h) the name and address of the Paying Agent and the Conversion Agent;
(i) the Conversion Price and any adjustments thereto;
(j) that the Convertible Notes as to which a Repurchase Notice has been
given may be converted if they are otherwise convertible pursuant to Article 14
only if the Repurchase Notice has been withdrawn in accordance with the terms of
this Indenture;
(k) that the Convertible Notes must be surrendered to the Paying Agent
to collect payment;
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(l) that the Repurchase Price for any Convertible Note as to which a
Repurchase Notice has been duly given and not withdrawn will be paid promptly
following the later of the Repurchase Date and the time of surrender of such
Convertible Note;
(m) the procedures the holder of Convertible Notes must follow to
exercise its repurchase right under this Section 4.2;
(n) the procedures for withdrawing a Repurchase Notice;
(o) that, unless the Company defaults in making payment of such
Repurchase Price, interest (including Contingent Interest, if any) and
Liquidated Damages, if any, on Convertible Notes surrendered for repurchase by
the Company will cease to accrue on and after the Repurchase Date; and
(p) the CUSIP number(s) of the Convertible Notes.
At the Company's request, the Trustee shall give the notice of
repurchase right in the Company's name and at the Company's expense; provided,
however, that the Company makes such request at least three business days
(unless a shorter period shall be satisfactory to the Trustee) prior to the date
by which such notice of repurchase right must be given to the holder in
accordance with this Section 4.2; provided, further, that the text of the notice
of repurchase right shall be prepared by the Company.
SECTION 4.3 Repurchase Notice; Repurchase Procedure.
A holder of Convertible Notes may exercise its right specified in
Section 4.1 upon delivery of a written notice of repurchase (a "Repurchase
Notice") to the Paying Agent at any time during the period beginning at 9:00
a.m., New York City time, on the date that is 20 Business Days immediately
preceding the relevant Repurchase Date until 5:00 p.m., New York City time, on
the last business day immediately preceding such Repurchase Date, stating:
(a) if certificated Convertible Notes have been issued, the certificate
number of the Convertible Note which the holder will deliver to be repurchased
or, if certificated Convertible Notes have not been issued, the appropriate
Depositary procedures;
(b) the portion of the principal amount of the Convertible Note which
the holder will deliver to be repurchased, which portion must be in principal
amounts of $1,000 or a multiple of $1,000;
(c) that such Convertible Note shall be repurchased by the Company as
of the Repurchase Date pursuant to the terms and conditions specified in the
Convertible Notes and in this Indenture; and
(d) in the event the Company elects, pursuant to Section 4.4, to pay
the Repurchase Price, in whole or in part, in shares of Common Stock but such
portion of the Repurchase Price shall ultimately be paid to such holder entirely
in cash because any of the conditions to payment of the Repurchase Price or
portion of the Repurchase Price in shares of Common Stock is not satisfied prior
to 5:00 p.m., New York City time, on the last business day immediately preceding
21
the relevant Repurchase Date, as set forth in Section 4.1, whether such holder
elects to (A) withdraw such Repurchase Notice as to some or all of the
Convertible Notes to which such Repurchase Notice relates (stating the principal
amount and certificate numbers, if any or the appropriate Depositary procedures,
if applicable, of the Convertible Notes as to which such withdrawal shall
relate), or (B) receive cash in respect of the entire Repurchase Price for all
Convertible Notes (or portions thereof) to which such Repurchase Notice relates.
The delivery of such Convertible Note to the Paying Agent with, or at
any time after delivery of, the Repurchase Notice (together with all necessary
endorsements) at the offices of the Paying Agent shall be a condition to the
receipt by the holder of the Repurchase Price therefor; provided, however, that
such Repurchase Price shall be so paid pursuant to this Section 4.3 only if the
Convertible Note so delivered to the Paying Agent shall conform in all respects
to the description thereof in the related Repurchase Notice.
If a holder, in such holder's Repurchase Notice and in any written
notice of withdrawal delivered by such holder pursuant to the terms of this
Section 4.3, fails to indicate such holder's choice with respect to the election
set forth in Section 4.3(d), such holder shall be deemed to have elected to
receive cash in respect of the entire Repurchase Price for all Convertible Notes
subject to such Repurchase Notice in the circumstances set forth in such Section
4.3(d).
The Company shall repurchase from the holder thereof, pursuant to this
Article 4, a portion of a Convertible Notes, so long as the principal amount of
such portion is $1,000 or a multiple of $1,000. Provisions of this Indenture
that apply to the repurchase of all of a Convertible Note also apply to the
repurchase of such portion of such Convertible Note.
Any repurchase by the Company contemplated pursuant to the provisions
of this Article 4 shall be consummated by the delivery of the consideration to
be received by the holder of a Convertible Note promptly following the later of
the Repurchase Date and the time of delivery of the Convertible Note.
Notwithstanding anything contained herein to the contrary, any holder
of a Convertible Note delivering to the Paying Agent the Repurchase Notice
contemplated by this Section 4.3 shall have the right to withdraw such
Repurchase Notice at any time prior to 5:00 p.m., New York City time, on the
Repurchase Date by delivery of a written notice of withdrawal to the Paying
Agent in accordance with Section 4.5.
The Paying Agent shall promptly notify the Company of the receipt by it
of any Repurchase Notice or written notice of withdrawal thereof.
SECTION 4.4 The Company's Right to Elect Manner of Payment of Repurchase Price.
On August 15, 2008, the Repurchase Price shall be paid for in cash
only. On August 15, 2013 and August 15, 2018, the Repurchase Price may be paid
for at the election of the Company, in cash or shares of Common Stock, or in any
combination of cash and shares of Common Stock, subject to the conditions set
forth in this Section 4.4. The Company shall designate, in the notice of
repurchase right delivered pursuant to Section 4.2, whether the Company will
repurchase the Convertible Notes for cash or, if permitted hereunder, shares of
Common Stock, or, if a combination thereof, the percentages of the Repurchase
Price in respect of which it will pay in
22
cash or shares of Common Stock; provided, however, that the Company will pay
cash for fractional interests in a share of Common Stock. For purposes of
determining the existence of potential fractional interests, all Convertible
Notes subject to repurchase by the Company held by a holder shall be considered
together (no matter how many separate certificates are to be presented). Each
holder whose Convertible Notes are repurchased pursuant to this Article 4 shall
receive the same percentage of cash or, if permitted hereunder, shares of Common
Stock in payment of the Repurchase Price for such Convertible Notes, except as
provided in this Section 4.4 with regard to the payment of cash (i) in lieu of
fractional shares of Common Stock and (ii) in the event that the Company is
unable to purchase the Convertible Notes of the holder or holders for shares of
Common Stock because any necessary qualifications or registration of the shares
of Common Stock under applicable securities laws cannot be obtained. The Company
may not change its election with respect to the consideration (or components or
percentages of components thereof) to be paid once the Company has given its
notice of repurchase right to holders except in the event of a failure to
satisfy, prior to 5:00 p.m., New York City time, on the business day immediately
preceding the Repurchase Date, any condition to the payment of the Repurchase
Price, in whole or in part, in shares of Common Stock.
If the Company elects to pay all or a portion of the Repurchase Price
of Convertible Notes in respect of which a Repurchase Notice pursuant to Section
4.3 has been given in shares of Common Stock, the number of shares of Common
Stock to be issued shall be equal to the portion of the Repurchase Price to be
paid in shares of Common Stock divided by the Market Price of one share of
Common Stock, subject to satisfaction of the conditions set forth in the second
succeeding paragraph.
The Company will not issue any fraction of a share of Common Stock in
payment of the Repurchase Price. Instead, the Company will make a cash payment
(calculated to the nearest cent) equal to such fraction multiplied by the Market
Price of one share of Common Stock. If a holder elects to have more than one
Convertible Note purchased, the number of shares of Common Stock shall be based
on the aggregate amount of Convertible Notes to be purchased.
The Company's right to exercise its election to repurchase Convertible
Notes through the issuance of shares of Common Stock shall be conditioned upon:
(a) the registration of such shares of Common Stock under the
Securities Act and the Exchange Act, in each case, if required;
(b) any qualification or registration of such shares of Common Stock
under applicable state securities laws, if necessary, or the availability of an
exemption from such qualification and registration;
(c) the listing of such shares of Common Stock on the principal United
States securities exchange on which Common Stock is then listed or the quotation
of such shares of Common Stock in the National Association of Securities Dealers
Automated Quotation System, if the Common Stock is quoted thereon;
(d) the receipt by the Trustee of an Officers' Certificate stating: (A)
that the terms of the issuance of the shares of Common Stock are in conformity
with this Indenture; (B) that the
23
shares of Common Stock to be issued in payment of the Repurchase Price in
respect of Convertible Notes have been duly authorized and, when issued and
delivered pursuant to the terms of this Indenture in payment of the Repurchase
Price in respect of Convertible Notes, will be validly issued, fully paid,
non-assessable and free from preemptive rights; (C) that the conditions above,
the conditions in clauses (a)-(c) above and the condition set forth in the third
to last paragraph of this Section 4.4 regarding issuance of a press release have
been satisfied in all material respects; and (D) the number of shares of Common
Stock to be issued for each $1,000 principal amount of Convertible Notes and the
Sale Price of a share of Common Stock on each Trading Day during the period
commencing on the first Trading Day of the period during which the Market Price
is calculated and ending on the Trading Day immediately preceding the Repurchase
Date; and
(e) the receipt by the Trustee of an Opinion of Counsel stating that:
(A) the shares of Common Stock to be issued in payment of the Repurchase Price
in respect of Convertible Notes have been duly authorized, and when issued and
delivered pursuant to the terms of this Indenture in payment of the Repurchase
Price in respect of Convertible Notes, will be validly issued, fully paid and
non-assessable and, to the best of such counsel's knowledge, free from
preemptive rights; and (B) the conditions in clauses (a) through (c) above have
been satisfied in all material respects.
If the foregoing conditions are not satisfied with respect to a holder
or holders of Convertible Notes prior to 5:00 p.m., New York City time, on the
last business day immediately preceding the Repurchase Date, and the Company has
elected to repurchase the Convertible Notes pursuant to this Section 4.4 through
the issuance of Common Stock, the Company shall pay the entire Repurchase Price
of the Convertible Notes of such holder or holders in cash.
The Company shall be permitted to pay the Repurchase Price or any
portion thereof in shares of Common Stock only if the information necessary to
calculate the Market Price is published in a daily newspaper of national
circulation.
Upon determination of the actual number of shares of Common Stock to be
issued for each $1,000 principal amount of Convertible Notes to be repurchased,
the Company shall promptly issue a press release through a public medium as is
customary for such a press release and publish such information on its website.
All shares of Common Stock delivered upon repurchase of the Securities
shall be duly authorized, validly issued, fully paid and nonassessable, and
shall be free from preemptive rights and free of any lien or adverse claim.
If a holder of a repurchased Convertible Notes is paid in shares of
Common Stock, the Company shall pay any documentary, stamp or similar issue or
transfer tax due on such issue of shares of Common Stock. However, the holder
shall pay any such tax which is due because the holder requests the shares of
Common Stock to be issued in a name other than the holder's name. The Paying
Agent may refuse to deliver the certificates representing the shares of Common
Stock being issued in a name other than the holder's name until the Paying Agent
receives a sum sufficient to pay any tax that will be due because the shares of
Common Stock are to be issued in
24
a name other than the holder's name. Nothing contained herein shall preclude any
income tax withholding required by law or regulations.
SECTION 4.5 Effect of Repurchase Notice.
Upon receipt by the Paying Agent of the Repurchase Notice specified in
Section 4.3, the holder of a Convertible Note in respect of which such
Repurchase Notice was given shall (unless such Repurchase Notice is withdrawn as
specified in the following paragraph) thereafter be entitled to receive solely
the Repurchase Price with respect to such Convertible Note. Such Repurchase
Price shall be paid to such holder, subject to receipts of cash and/or shares of
Common Stock by the Paying Agent, promptly following the later of (a) the
Repurchase Date with respect to such Convertible Note (provided the conditions
in Section 4.3 have been satisfied) and (b) the time of delivery of such
Convertible Note to the Paying Agent by the holder thereof in the manner
required by Section 4.3. Convertible Notes in respect of which a Repurchase
Notice has been given by the holder thereof may not be converted pursuant to
Article 14 on or after the date of the delivery of such Repurchase Notice unless
such Repurchase Notice has first been validly withdrawn as specified in the
following paragraph.
A Repurchase Notice may be withdrawn by means of a written notice of
withdrawal delivered to the office of the Paying Agent in accordance with the
Repurchase Notice at any time prior to 5:00 p.m., New York City time, on the
Repurchase Date, specifying:
(a) the principal amount of the Convertible Note with respect to which
such notice of withdrawal is being submitted;
(b) the certificate number, if any, or the appropriate Depositary
procedures, if applicable, of the Convertible Note in respect of which such
notice of withdrawal is being submitted; and
(c) the principal amount, if any, of such Convertible Note which
remains subject to the original Repurchase Notice and which has been or will be
delivered for repurchase by the Company.
SECTION 4.6 Deposit of Repurchase Price.
Prior to 11:00 a.m., New York City time, on the business day
immediately following the applicable Repurchase Date, the Company shall deposit
with the Paying Agent (or if the Company or a subsidiary of the Company or an
Affiliate of any of them is acting as the Paying Agent, shall segregate and hold
in trust as provided in Section 2.4) an amount of cash (in immediately available
funds if deposited on such business day) and/or shares of Common Stock, if
permitted hereunder, sufficient to pay the aggregate Repurchase Price of all the
Convertible Notes or portions thereof which are to be repurchased as of such
Repurchase Date.
If the Paying Agent holds, in accordance with the terms hereof, at
11:00 a.m., New York City time, on the business day immediately following the
applicable Repurchase Date, Cash and/or shares of Common Stock, if permitted
hereunder, sufficient to pay the Repurchase Price of any Convertible Notes for
which a Repurchase Notice has been tendered and not withdrawn pursuant to
Section 4.5, then, immediately after such Repurchase Date, such Convertible
Notes
25
will cease to be outstanding and interest (including Contingent Interest, if
any) and Liquidated Damages, if any, on such Convertible Notes will cease to
accrue, whether or not such Convertible Notes are delivered to the Paying Agent,
and the rights of the holders in respect thereof shall terminate (other than the
right to receive the Repurchase Price upon delivery of such Convertible Notes).
As soon as practicable on and after the Repurchase Date, the Company
shall deliver to each holder entitled to receive shares of Common Stock through
the Paying Agent, a certificate (other than in the case of holders of
Convertible Notes in book-entry form with the Depositary, which shares shall be
delivered in accordance with the Depositary's customary practices) for the
number of full shares of Common Stock issuable in payment of the Repurchase
Price and cash in lieu of any fractional interests. The person in whose name the
certificate for the shares of Common Stock is registered shall be treated as a
holder of record of shares of Common Stock on the Repurchase Date. No payment or
adjustment will be made for dividends on the shares of Common Stock the record
date for which occurred prior to the Repurchase Date.
SECTION 4.7 Convertible Notes Repurchased in Part.
Any certificated Convertible Notes which are to be repurchased only in
part shall be surrendered at the office of the Paying Agent (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the holder thereof or such holder's attorney duly authorized in writing) and
the Company shall execute and the Trustee shall authenticate and deliver to the
holder of such Convertible Note, without charge, a new Convertible Note or
Convertible Notes, of any authorized denomination as requested by such holder in
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Convertible Note so surrendered which is not
repurchased.
SECTION 4.8 No Purchase If Event of Default Has Occurred.
There shall be no purchase of any Convertible Notes pursuant to this
Article 4 if there has occurred (prior to, on or after, as the case may be, the
giving, by the holders of such Convertible Notes, of the required Repurchase
Notice) and is continuing, an Event of Default (other than a default in the
payment of the Repurchase Price with respect to such Convertible Notes). The
Paying Agent will promptly return to the respective holders any Convertible
Notes (x) with respect to which a Repurchase Notice has been withdrawn in
compliance with this Indenture or (y) held by it during the continuance of an
Event of Default (other than a default in the payment of the Repurchase Price
with respect to such Convertible Notes) in which case upon such return the
Repurchase Notice with respect thereto shall be deemed to have been withdrawn.
SECTION 4.9 Compliance with Applicable Law in Connection with Repurchase
of Convertible Notes.
When complying with the provisions of this Article 4, the Company shall
comply with all applicable provisions of the Exchange Act, and all applicable
tender offer rules promulgated thereunder (including the provisions of Rule
13e-4 and Rule 14e-1) to the extent such laws and regulations are then
applicable.
26
To the extent that the provisions of any securities laws or regulations
Sconflict with the provisions of this Article 4, the Company's compliance with
such laws and regulations shall not in and of itself cause a breach of its
obligations under this Article 4.
SECTION 4.10 Repayment to the Company.
To the extent that the aggregate amount of cash or shares of Common
Stock deposited by the Company pursuant to Section 4.6 exceeds the aggregate
Repurchase Price of the Convertible Notes or portions thereof which the Company
is obligated to repurchase on the Repurchase Date, then, promptly after the
Repurchase Date, the Paying Agent shall return any such excess cash or shares of
Common Stock to the Company.
ARTICLE 5
REPURCHASE OF CONVERTIBLE NOTES
UPON FUNDAMENTAL CHANGE
SECTION 5.1 Fundamental Change Put.
Following a Fundamental Change (the date of each such occurrence being
the "Fundamental Change Date") prior to the Maturity Date, the Company shall
notify the holders of Convertible Notes in writing of such occurrence and shall
make an offer (the "Fundamental Change Offer") to repurchase all Convertible
Notes then outstanding at a repurchase price in cash (the "Fundamental Change
Payment") equal to 100% of the principal amount thereof, plus accrued and unpaid
interest (including Contingent Interest, if any) and Liquidated Damages, if any,
to, but excluding, the Fundamental Change Expiration Date (as defined below).
SECTION 5.2 Notice of Fundamental Change.
No later than 30 days after the applicable Fundamental Change Date, the
Company shall mail a Notice of a Fundamental Change to each holder of
Convertible Notes as shown on the Register and to each beneficial owner as
required by law at the address as shown on the Register of holders maintained by
the Registrar, with a copy to the Trustee and the Paying Agent. During the
period specified in such notice, holders of Convertible Notes may elect to
tender their Convertible Notes in whole or in part in integral multiples of
$1,000 in exchange for cash. Payment shall be made by the Company, at the time
specified in Section 5.3, in respect of Convertible Notes properly tendered
pursuant to this Article 5 on or before the day (the "Fundamental Change
Expiration Date") which shall be the sixtieth day after the date of the notice
of the applicable Fundamental Change. The notice, which shall govern the terms
of the Fundamental Change Offer, shall include such disclosures as are required
by law and shall state:
(a) that a Fundamental Change Offer is being made pursuant to this
Article 5 and that all Convertible Notes will be accepted for payment;
(b) a brief description of the event, transaction or transactions that
constitute the Fundamental Change;
27
(c) the Fundamental Change Payment for each Convertible Note and the
Fundamental Change Expiration Date;
(d) that any Convertible Note not accepted for payment will continue to
accrue interest (including Contingent Interest, if applicable) and Liquidated
Damages, if applicable, in accordance with the terms thereof;
(e) that, unless the Company defaults on making the Fundamental Change
Payment, any Convertible Note accepted for payment pursuant to the Fundamental
Change Offer shall cease to accrue interest (including Contingent Interest, if
applicable) and Liquidated Damages, if applicable, on the Fundamental Change
Expiration Date and no further interest or Contingent Interest or Liquidated
Damages shall accrue on or after such date;
(f) that holders electing to have Convertible Notes repurchased
pursuant to a Fundamental Change Offer will be required to deliver, no later
than the sixtieth day after the date of the Company's notice described in this
paragraph, a repurchase notice electing to require the Company to repurchase all
or some portion of the Convertible Notes held by such holder, which notice shall
state (i) the name of the holder, (ii) the principal amount of Convertible Notes
the holder is delivering for purchase which must be $1,000 or an integral
multiple thereof and (iii) the Convertible Note certificate number (if any);
(g) that holders of Convertible Notes will be entitled to withdraw
their election if the Paying Agent receives, not later than 5:00 p.m., New York
City time, on the Fundamental Change Expiration Date, a facsimile transmission
or letter setting forth (i) the name of the holder, (ii) the principal amount of
Convertible Notes the holder delivered for purchase, (iii) the Convertible Note
certificate number (if any) delivered, (iv) a statement that such holder is
withdrawing his election to have such Convertible Notes purchased, (v) the
principal amount of Convertible Notes being withdrawn, (vi) the Convertible Note
certificate number (if any) being withdrawn and (vii) the principal amount of
Convertible Notes that remains subject to the Fundamental Change Offer, if any;
(h) that holders whose Convertible Notes are repurchased only in part
will be issued Convertible Notes equal in principal amount to the unpurchased
portion of the Convertible Notes surrendered provided that the unpurchased
portion shall be in an authorized denomination;
(i) the procedures that holders of Convertible Notes must follow in
order to tender their Convertible Notes;
(j) that in the case of a Fundamental Change Expiration Date that is
also an Interest Payment Date, the interest payment (including Contingent
Interest, if any) and Liquidated Damages, if any, due on such date shall be paid
to the person in whose name the Convertible Note is registered at the close of
business on the Regular Record Date immediately preceding such Interest Payment
Date; and
(k) that the Fundamental Change Payment for any Convertible Note as to
which a repurchase notice has been duly given and not withdrawn pursuant to the
Fundamental Change Offer will be paid promptly following the later of the
Fundamental Change Expiration Date and the time of surrender of such Convertible
Note.
28
SECTION 5.3 Deposit of Fundamental Change Payment.
On the Fundamental Change Expiration Date, the Company shall accept for
payment all Convertible Notes or portions thereof properly tendered pursuant to
the Fundamental Change Offer. Prior to 11:00 a.m., New York City time, on the
business day following the Fundamental Change Expiration Date, the Company shall
deposit with the Paying Agent money sufficient to pay the Fundamental Change
Payment with respect to all Convertible Notes or portions thereof so tendered
and accepted and deliver or cause to be delivered to the Trustee the Convertible
Notes so accepted together with an Officers' Certificate setting forth the
aggregate principal amount of Convertible Notes or portions thereof tendered to
and accepted for payment by the Company. Promptly following the receipt of the
Fundamental Change Payment, the Paying Agent shall mail or deliver the
Fundamental Change Payment to the holders of Convertible Notes so accepted and
the Trustee shall as soon as reasonably practicable authenticate and mail or
cause to be transferred by book entry to such holders a new Convertible Note
equal in principal amount to any unpurchased portion of the Convertible Note
surrendered, if any; provided that such new Convertible Notes will be in a
principal amount of $1,000 or an integral multiple thereof. Any Convertible
Notes not so accepted shall be promptly mailed or delivered by the Company to
the holder thereof.
SECTION 5.4 Supplemental Indenture Following Fundamental Change.
In the case of any reclassification, change, consolidation, merger,
share exchange, combination or sale or conveyance to which Section 14.6 applies
in which the Common Stock of the Company is changed or exchanged into the right
to receive stock, securities or other property or assets (including cash) which
includes shares of common stock of the Company or another person that are, or
upon issuance will be, traded on a United States national securities exchange or
approved for trading on an established automated over- the-counter trading
market in the United States and such shares constitute at the time such change
or exchange becomes effective in excess of 90% of the aggregate fair market
value of such stock, securities or other property and assets (including cash)
(as determined by the Company, which determination shall be conclusive and
binding), then the person formed by such consolidation or resulting from such
merger or share exchange or which acquires such assets, as the case may be,
shall execute and deliver to the Trustee a supplemental indenture (which shall
comply with the TIA as in force at the date of execution of such supplemental
indenture) modifying the provisions of this Indenture relating to the right of
holders of Convertible Notes to cause the Company to repurchase Convertible
Notes following a Fundamental Change, including the applicable provisions of
this Article 5 and the definitions of Fundamental Change, Change of Control and
Termination of Trading, as appropriate, as determined in good faith by the
Company (which determination shall be conclusive and binding), to make such
provision apply to such common stock and the issuer thereof if different from
the Company and Common Stock of the Company (in lieu of the Company and the
Common Stock of the Company).
SECTION 5.5 No Purchase Following Fundamental Change If Event of Default Has
Occurred.
There shall be no purchase of any Convertible Notes pursuant to this
Article 5 if there has occurred (prior to, on or after, as the case may be, the
giving, by the holders of such Convertible
29
Notes, of the required Fundamental Change repurchase notice) and is continuing,
an Event of Default (other than a default in the payment of the Fundamental
Change Payment with respect to such Convertible Notes). The Paying Agent will
promptly return to the respective holders any Convertible Notes (x) with respect
to which a Fundamental Change repurchase notice has been withdrawn in compliance
with this Indenture or (y) held by it during the continuance of an Event of
Default (other than a default in the payment of the Fundamental Change Payment
with respect to such Convertible Notes) in which case upon such return the
Fundamental Change repurchase notice with respect thereto shall be deemed to
have been withdrawn.
SECTION 5.6 Compliance with Applicable Law in Connection with Fundamental
Change Offer.
The Fundamental Change Offer shall be made by the Company in compliance
with all applicable provisions of the Exchange Act, and all applicable tender
offer rules promulgated thereunder (including the provisions of Rule 13e-4 and
Rule 14e-1), to the extent such laws and regulations are then applicable and
shall include all instructions and materials that the Company shall reasonably
deem necessary to enable such holders of Convertible Notes to tender their
Convertible Notes.
To the extent that the provisions of any securities laws or regulations
conflict with the provisions of this Article 5, the Company's compliance with
such laws and regulations shall not in and of itself cause a breach of its
obligations under this Article 5.
ARTICLE 6
CONTINGENT INTEREST
SECTION 6.1 Contingent Interest.
The Company will pay Contingent Interest to the holders of Convertible
Notes during any six-month period (a "Contingent Interest Period") from August
15 to February 14 and from February 15 to August 14, commencing with the
six-month period beginning on August 15, 2008, if the average Trading Price for
each $1,000 principal amount of a Convertible Note for the five Trading Day
period ending on the second Trading Day immediately preceding the first day of
the relevant Contingent Interest Period equals $1,200 (120% of the principal
amount of a Convertible Note) or more. The amount of Contingent Interest payable
on each $1,000 principal amount of Convertible Notes with respect to any
Contingent Interest Period shall equal 0.25% of the average Trading Price for
each $1,000 principal amount of Convertible Notes during such five Trading Day
period.
SECTION 6.2 Payment of Contingent Interest.
Contingent Interest for any Contingent Interest Period, if any, shall
accrue and be paid on the February 15 or August 15 following each Contingent
Interest Period (the "Contingent Interest Payment Date") to holders in whose
name any Convertible Note is registered with the Registrar at the close of
business on the preceding Regular Record Date.
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SECTION 6.3 Contingent Interest Notification.
Upon a determination by the Company that holders of Convertible Notes will be
entitled to receive Contingent Interest which will become payable during a
Contingent Interest Period, on or prior to the first day of such Contingent
Interest Period, the Company shall deliver a written notice to the Trustee
setting forth the amount of such Contingent Interest per $1,000 principal amount
of Convertible Notes and shall disseminate a press release through a public
medium as is customary for such press releases or publish such information on
the Company's website or such other public medium as may be used at that time.
ARTICLE 7
COVENANTS
SECTION 7.1 Payment of Convertible Notes.
The Company shall pay the principal of and interest (including
Contingent Interest and Liquidated Damages, if any) on the Convertible Notes on
the dates and in the manner provided in the Convertible Notes. Principal,
interest, the Redemption Price, the Repurchase Price and the Fundamental Change
Payment shall be considered paid on the date due if the Trustee or Paying Agent
(other than the Company or a subsidiary of the Company) holds as of 11:00 a.m.,
New York City time, on the date specified herein immediately available funds
designated for and sufficient to pay all principal, interest (including
Contingent Interest and Liquidated Damages, if any), the Redemption Price, the
Repurchase Price or the Fundamental Change Payment then due. To the extent
lawful, the Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on (i) overdue principal, at the rate borne
by Convertible Notes, compounded semiannually; and (ii) overdue installments of
interest (without regard to any applicable grace period) at the same rate,
compounded semiannually.
SECTION 7.2 Rule 144A Information; Periodic Reports to the Trustee.
So long as any of the Convertible Notes or shares of Common Stock
issuable upon conversion of the Convertible Notes are "restricted securities"
within the meaning of Rule 144(a)(3) under the Securities Act, each of the
Company and the Guarantor will, during any period in which it is not subject to
and in compliance with Section 13 or Section 15(d) of the Exchange Act, provide
to each holder and beneficial owner of such restricted securities and to each
prospective purchaser (as designated by such holder or beneficial owner) of such
restricted securities, upon the request of such holder or beneficial owner or
prospective purchaser, any information required to be provided by Rule
144A(d)(4) under the Securities Act.
The Company and the Guarantor shall provide to the Trustee such
documents, reports and information as required by TIA Section 314 (if any) in
the form, in the manner and at the times required by TIA Section 314. Delivery
of such reports, information and documents to the Trustee is for informational
purposes only and the Trustee's receipt of such shall not constitute
constructive notice of any information contained therein or determinable from
information contained therein, including the Company's and the Guarantor's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
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SECTION 7.3 Compliance Certificate.
The Company and the Guarantor each shall deliver to the Trustee within
120 days after the end of its respective fiscal year, an Officers' Certificate
stating that neither of the signers thereof has any knowledge, after due
investigation during the preceding fiscal year made under the supervision of the
signing officers, of any Default or Event of Default (or, if any Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge). As of the date hereof, the
fiscal year of each of the Company and the Guarantor ends on December 31.
The Company shall, so long as any of the Convertible Notes are
outstanding, deliver to the Trustee, forthwith upon becoming aware of any
Default or Event of Default, an Officers' Certificate specifying such Default or
Event of Default and what action the Company is taking or proposes to take with
respect thereto.
SECTION 7.4 Maintenance of Office or Agency.
The Company shall maintain or cause to be maintained the office or
agency required under Section 2.3. The Company shall give prompt written notice
to the Trustee of the location, and any change in the location, of such office
or agency not maintained by the Trustee. If at any time the Company shall fail
to maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, presentations, surrenders, notices and demands
with respect to the Convertible Notes may be made or served at the Corporate
Trust Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Convertible Notes may be presented or surrendered
for any or all such purposes and may from time to time rescind such designation.
SECTION 7.5 Continued Existence.
Subject to Article 8, the Company shall do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence.
SECTION 7.6 Appointments to Fill Vacancies in Trustee's Office.
The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 10.8, a
Trustee, so that there shall at all times be a Trustee hereunder.
SECTION 7.7 Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter enforced, that may affect the Company's
obligation to pay the Convertible Notes; and the Company (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any such
law insofar as such law applies to the Convertible Notes, and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law has been enacted.
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SECTION 7.8 Taxes.
The Company shall, and shall cause each of its subsidiaries to, pay
prior to delinquency all taxes, assessments and government levies; provided,
however, that the Company shall not be required to pay or cause to be paid any
such tax, assessment or levy (A) if the failure to do so will not, in the
aggregate, have a material adverse impact on the Company and its subsidiaries
taken as a whole, or (B) if the amount, applicability or validity is being
contested in good faith by appropriate proceedings.
SECTION 7.9 Investment Company Act.
As long as any Convertible Notes are outstanding, the Company will
conduct its business and operations so as not to become an "investment company"
within the meaning of the Investment Company Act of 1940, as amended (the
"Investment Company Act"), and will take all steps required in order for it to
continue not to be an "investment company" and not to be required to be
registered under the Investment Company Act, including, if necessary,
redeployment of the assets of the Company.
SECTION 7.10 Contingent Debt Tax Treatment.
The Company agrees, and by acceptance of a Convertible Note, each
holder of a Convertible Note is deemed to have agreed, with respect to each of
the matters set forth in (a) and (b) below, as follows:
(a) Tax Treatment:
(i) to treat the Convertible Notes as indebtedness of the
Company for all tax purposes;
(ii) to treat the Convertible Notes as indebtedness that are
subject to the special regulations governing contingent payment debt instruments
that are contained in U.S. Treasury Regulation section 1.1275-4; and
(iii) to treat any payment to and receipt by a holder of
Common Stock upon conversion of a Convertible Note as a contingent payment under
U.S. Treasury Regulation section 1.1275-4(b) that will result in an adjustment
under U.S. Treasury Regulation section 1.1275-4(b)(3)(iv) and U.S. Treasury
Regulation section 1.1275-4(b)(6).
(b) Comparable Yield and Projected Payment Schedule. Solely for
purposes of applying U.S. Treasury Regulation section 1.1275-4 to the
Convertible Notes:
(i) for United States federal income tax purposes, the Company
shall accrue Contingent Interest with respect to outstanding Convertible Notes
as original issue discount according to the "noncontingent bond method," as set
forth in U.S. Treasury Regulation section 1.1275-4(b);
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(ii) the Company has determined that the comparable yield, as
defined in U.S. Treasury Regulation section 1.1275-4(b)(4)(i), for the
Convertible Notes is 7.5%, compounded semiannually;
(iii) the Company has determined the projected payment
schedule, as defined in U.S. Treasury Regulation section 1.1275-4(b)(ii); and
(iv) the Company acknowledges and agrees, and each holder of a
Convertible Note and any beneficial owner of the Convertible Note, by its
purchase of a Convertible Note shall be deemed to acknowledge and agree that (A)
the projected payment schedule is determined on a basis of an assumption of
linear growth of stock price and a constant dividend yield, (B) the comparable
yield and the projected payment schedule are not determined for any purpose
other than for the purpose of applying U.S. Treasury Regulation section
1.1275-4(b) to the Convertible Notes and (C) the comparable yield and the
projected payment schedule do not constitute a projection or representation
regarding the actual amounts payable on the Convertible Notes.
(c) A holder of Convertible Notes may obtain the issue price, the issue
date, the amount of original issue discount, the yield to maturity, the
comparable yield and the projected payment schedule for the Convertible Notes by
writing to the Company at the address set forth in Section 13.2.
SECTION 7.11 Calculation of Original Issue Discount.
The Company shall file with the Trustee promptly at the end of each
calendar year (i) a written notice specifying the amount of original issue
discount (including daily rates and accrual periods) accrued on outstanding
Convertible Notes as of the end of such year and (ii) such other specific
information relating to such original issue discount as may then be relevant
under the Code.
ARTICLE 8
SUCCESSORS
SECTION 8.1 When the Company May Merge, Etc.
The Company may not, in a single transaction or series of related
transactions, consolidate or merge with or into, or effect a share exchange with
(whether or not the Company is the surviving corporation), or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets as an entirety or substantially as an entirety to, any
person or entity unless:
(a) either
(i) the Company shall be the surviving or continuing
corporation or
(ii) the entity or person formed by or surviving any such
consolidation or share exchange or into which the Company is merged (if other
than the Company) or the entity
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or person which acquires by sale, assignment, transfer, lease, conveyance or
other disposition the properties and assets of the Company as an entirety or
substantially as an entirety
(1) shall be a corporation organized and validly existing
under the laws of the United States or any State thereof or the District of
Columbia and
(2) shall expressly assume, by supplemental indenture in
form reasonably satisfactory to the Trustee, executed and delivered to the
Trustee, the due and punctual payment of the principal of, and interest and
Liquidated Damages, if any, on, all of the Convertible Notes and the performance
of every covenant of the Convertible Notes and this Indenture and the
Registration Agreement on the part of the Company to be performed or observed,
including, without limitation, modifications to rights of holders to cause the
repurchase of Convertible Notes upon a Fundamental Change in accordance with
Section 5.4 and conversion rights in accordance with Section 14.6 to the extent
required by such Sections;
(b) immediately after giving effect to such transaction no Default and
no Event of Default shall have occurred and be continuing; and
(c) the Company or such person shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
consolidation, merger, share exchange, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such transaction, such
supplemental indenture, comply with this provision of this Indenture and that
all conditions precedent in this Indenture relating to such transaction have
been satisfied.
For purposes of this Section 8.1, the transfer (by lease, assignment,
sale or otherwise, in a single transaction or series of transactions) of all or
substantially all of the properties or assets of one or more subsidiaries of the
Company, the capital stock of which constitutes all or substantially all of the
properties and assets of the Company, shall be deemed to be the transfer of all
or substantially all of the properties and assets of the Company.
SECTION 8.2 Successor Corporation Substituted.
Upon any such consolidation, merger, share exchange, sale, assignment,
conveyance, lease, transfer or other disposition in accordance with Section 8.1,
the successor person formed by such consolidation, or share exchange or into
which the Company is merged or to which such assignment, conveyance, lease,
transfer or other disposition is made will succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture with
the same effect as if such successor had been named as the Company therein, and
thereafter (except in the case of a sale, assignment, transfer, lease,
conveyance or other disposition) the predecessor corporation will be relieved of
all further obligations and covenants under this Indenture and the Convertible
Notes.
SECTION 8.3 Purchase Option on Fundamental Change.
This Article 8 does not affect the obligations of the Company
(including without limitation any successor to the Company) under Article 5.
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ARTICLE 9
DEFAULTS AND REMEDIES
SECTION 9.1 Events of Default.
An "Event of Default" with respect to any Convertible Notes occurs if:
(a) the Company defaults in the payment of principal of the Convertible
Notes when due at maturity, upon acceleration or otherwise or defaults in the
payment when due of any Redemption Price, Repurchase Price or Fundamental Change
Payment;
(b) the Company defaults in the payment of any installment of interest
(including Contingent Interest) or Liquidated Damages on the Convertible Notes
when due and continuance of such default for 30 days or more; or
(c) the Company defaults (other than a default set forth in clauses (a)
and (b) above and clause (d) below) in the performance of, or breaches, any
other covenant or warranty of the Company set forth in this Indenture or the
Convertible Notes and fails to remedy such default or breach within a period of
60 days after the receipt of written notice from the Trustee or the holders of
at least 25% in aggregate principal amount of the then outstanding Convertible
Notes; or
(d) the Company fails to provide timely notice of any Fundamental
Change in accordance with Article 5; or
(e) the Company, pursuant to or within the meaning of any Bankruptcy
Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it
in an involuntary case,
(iii) consents to the appointment of a Custodian of it or for
all or substantially all of its property,
(iv) makes a general assignment for the benefit of its
creditors;
(v) makes the admission in writing that it generally is unable
to pay its debts as the same become due; or
(f) a court of competent jurisdiction enters a judgment, order or
decree under any Bankruptcy Law that:
(i) is for relief against the Company in an involuntary case,
(ii) appoints a Custodian of the Company, or
(iii) orders the liquidation of the Company,
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and in any case, the order or decree remains unstayed and in effect for 90 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal or state law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any Bankruptcy
Law.
SECTION 9.2 Acceleration.
If an Event of Default (other than an Event of Default with respect to
the Company specified in clauses (e) and (f) of Section 9.1) occurs and is
continuing, then and in every such case the Trustee, by written notice to the
Company and the Guarantor, or the holders of at least 25% in aggregate principal
amount of the then outstanding Convertible Notes, by written notice to the
Company, the Guarantor and the Trustee, may declare the unpaid principal of, and
accrued and unpaid interest (including Contingent Interest, if any) and
Liquidated Damages, if any, on, all the Convertible Notes to be due and payable.
Upon such declaration such principal amount, and accrued and unpaid interest
(including Contingent Interest, if any) and Liquidated Damages, if any, shall
become immediately due and payable, notwithstanding anything contained in this
Indenture or the Convertible Notes to the contrary. If any Event of Default with
respect to the Company specified in clauses (e) or (f) of Section 9.1 occurs,
all unpaid principal of and accrued and unpaid interest (including Contingent
Interest, if any) and Liquidated Damages, if any, on the Convertible Notes then
outstanding shall become automatically due and payable without any declaration
or other act on the part of the Trustee or any holder of Convertible Notes.
The holders of a majority in aggregate principal amount of the then
outstanding Convertible Notes by notice to the Trustee may rescind an
acceleration of the Convertible Notes and its consequences if all existing
Events of Default (other than nonpayment of principal of or interest (including
Contingent Interest, if any) and Liquidated Damages, if any, on the Convertible
Notes which has become due solely by virtue of such acceleration) have been
cured or waived, the amounts payable to the Trustee under Section 10.7 shall
have been paid and if the rescission would not conflict with any judgment or
decree of any court of competent jurisdiction. No such rescission shall affect
any subsequent Default or Event of Default or impair any right consequent
thereto.
SECTION 9.3 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect the payment of
principal of or interest (including Contingent Interest, if applicable) or
Liquidated Damages, if applicable, on the Convertible Notes or to enforce the
performance of any provision of the Convertible Notes or this Indenture. The
Trustee may maintain a proceeding even if it does not possess any of the
Convertible Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any holder of a Convertible Note in exercising any
right or remedy occurring upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default. All
remedies are cumulative to the extent permitted by law.
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SECTION 9.4 Waiver of Past Defaults.
The holders of a majority in aggregate principal amount of the
Convertible Notes then outstanding may, on behalf of the holders of all the
Convertible Notes, waive an existing Default or Event of Default and its
consequences, except a Default or Event of Default in the payment of the
principal of or interest (including Contingent Interest, if any) or Liquidated
Damages, if any, on the Convertible Notes (other than the non-payment of
principal of and interest (including Contingent Interest, if any) and Liquidated
Damages, if any, on the Convertible Notes which has become due solely by virtue
of an acceleration which has been duly rescinded as provided above), or in
respect of a covenant or provision of this Indenture which cannot be modified or
amended without the consent of all holders of Convertible Notes. When a Default
or Event of Default is waived, it is cured and stops continuing. No waiver shall
extend to any subsequent or other Default or Event of Default or impair any
right consequent thereon.
SECTION 9.5 Control by Majority.
The holders of a majority in aggregate principal amount of the then
outstanding Convertible Notes may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on it. However, the Trustee may refuse to follow
any direction that conflicts with law or this Indenture that the Trustee
determines may be unduly prejudicial to the rights of other holders of
Convertible Notes or that may involve the Trustee in personal liability;
provided that the Trustee shall have no duty or obligation (subject to Section
10.1) to ascertain whether or not such actions of forbearances are unduly
prejudicial to such holders; provided, further, that the Trustee may take any
other action the Trustee deems proper that is not inconsistent with such
directions.
SECTION 9.6 Limitation on Suits.
A holder of a Convertible Note may not pursue any remedy with respect
to this Indenture or the Convertible Notes unless:
(1) the holder gives to the Trustee notice of a continuing
Event of Default;
(2) the holders of at least 25% in principal amount of the
then outstanding Convertible Notes make a request to the Trustee to pursue the
remedy;
(3) such holder or holders offer and, if requested, provide to
the Trustee indemnity satisfactory to the Trustee against any loss, liability or
expense;
(4) the Trustee does not comply with the request within 60
days after receipt of the request and the offer and, if requested, the provision
of indemnity; and
(5) during such 60-day period the holders of a majority in
principal amount of the then outstanding Convertible Notes do not give the
Trustee a direction inconsistent with the request.
A holder of a Convertible Note may not use this Indenture to prejudice
the rights of another holder or to obtain a preference or priority over another
holder.
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SECTION 9.7 Rights of Holders To Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
holder of a Convertible Note to receive payment of principal, interest and
Liquidated Damages, if any, on the Convertible Note, on or after the respective
due dates expressed in the Convertible Note, or to bring suit for the
enforcement of any such payment on or after such respective dates, or to bring
suit for the enforcement of the right to convert the Convertible Note shall not
be impaired or affected without the consent of the holder of a Convertible Note.
SECTION 9.8 Collection Suit by Trustee.
If an Event of Default specified in Section 9.1(a) or (b) occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company for the whole amount of principal and
interest (including Contingent Interest, if any) and Liquidated Damages, if any,
remaining unpaid on the Convertible Notes and interest on overdue principal and
interest (including Contingent Interest, if any) and Liquidated Damages, if any,
and such further amount as shall be sufficient to cover the costs and, to the
extent lawful, expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
all other amounts due the Trustee under Section 10.7.
SECTION 9.9 Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee and
the holders of Convertible Notes allowed in any judicial proceedings relative to
the Company, its creditors or its property. The Trustee shall be entitled and
empowered, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of the principal of,
and interest (including Contingent Interest, if any) and Liquidated Damages, if
any, on, the Convertible Notes and to file such other papers or documents as may
be necessary or advisable in order to have the claims of the Trustee (including
any claim for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel and all other amounts due the Trustee
under Section 10.7.) and of the holders of the Convertible Notes allowed in such
judicial proceedings; and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any Custodian in
any such judicial proceeding is hereby authorized by each holder of Convertible
Notes to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the holder of
Convertible Notes, to pay the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 10.7.
Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any holder of a
Convertible Note any plan of reorganization, arrangement, adjustment or
composition affecting the Convertible Notes or the rights of any
39
holder thereof, or to authorize the Trustee to vote in respect of the claim of
any holder in any such proceeding.
SECTION 9.10 Priorities.
If the Trustee collects any money pursuant to this Article 9, it shall
pay out the money in the following order:
First: to the Trustee for amounts due under Section 10.7,
including payment of all compensation, expenses and
liabilities incurred, and all advances made, by the Trustee,
and the costs and expenses of collection;
Second: to holders of Convertible Notes for amounts due and
unpaid on the Convertible Notes for principal, interest
(including Contingent Interest, if any) and Liquidated
Damages, if any, ratably, without preference or priority of
any kind, according to the amounts due and payable on the
Convertible Notes for principal, interest (including
Contingent Interest, if any) and Liquidated Damages, if any,
respectively; and
Third: to the Company.
Except as otherwise provided in Section 2.12, the Trustee may fix a
record date and payment date for any payment to holders of Convertible Notes.
SECTION 9.11 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit, other than the Trustee, of an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys fees, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section does not apply to a suit by the Trustee, a suit
by a holder pursuant to Section 9.7 or a suit by holders of more than 10% in
principal amount of the then outstanding Convertible Notes.
ARTICLE 10
THE TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed. Whether or
not herein expressly so provided, every provision of this Indenture relating to
the conduct or affecting the liability of or affording protection to the Trustee
shall be subject to the provisions of this Article 10.
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SECTION 10.1 Duties of the Trustee.
(a) If an Event of Default known to a Trust Officer of the Trustee has
occurred and is continuing, the Trustee shall exercise such of the rights and
powers vested in it by this Indenture and use the same degree of care and skill
in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(b) Except during the continuance of an Event of Default known to the
Trustee:
(1) The duties of the Trustee shall be determined solely by
the express provisions of this Indenture, and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no others,
and no implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) In the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any statements, certificates or opinions
furnished to the Trustee and conforming to the requirements of this Indenture.
However, in the case of any certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the Trustee
shall examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture (but shall not be required to
confirm or investigate the accuracy of mathematical calculations or other facts
stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph
(b) or paragraph (e) of this Section;
(2) The Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer or any other officer of the
Trustee to whom such matter is referred, because of such person's knowledge of
and familiarity with the particular subject, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 9.5.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that is in any way related to the Trustee is subject to
paragraphs (a), (b), (c) and (e) of this Section 10.1.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties or the exercise of any of its rights and powers
hereunder, if it shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against such risk of liability is not
reasonably assured to it.
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(f) The Trustee shall not be liable for interest on or the investment
of any money received by it except as the Trustee may agree with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
SECTION 10.2 Rights of the Trustee.
(a) The Trustee may rely on and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate, or any other
certificate, statement, instrument, opinion, report, notice, request, consent,
order, security or other document believed by it to be genuine and to have been
signed or presented by the proper person. The Trustee need not investigate any
fact or matter contained therein.
(b) Any request, direction, order or demand of the Company or the
Guarantor mentioned herein shall be sufficiently evidenced by an Officers'
Certificate (unless other evidence in respect thereof is herein specifically
prescribed). In addition, before the Trustee acts or refrains from acting, it
may require an Officers' Certificate, an Opinion of Counsel or both. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on such Officers' Certificate or Opinion of Counsel. The Trustee may
consult with counsel and the advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection from liability in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon.
(c) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through attorneys and
agents and other persons not regularly in its employ and shall not be
responsible for the misconduct or negligence of any attorney or agent appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith without negligence or willful misconduct which it believes to
be authorized or within its discretion, rights or powers.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company shall be sufficient if
signed by Officers of the Company.
(f) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(g) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the holders of Convertible Notes pursuant to the provisions
of this Indenture, unless such holders have offered to the Trustee security or
indemnity satisfactory to it against the costs, expenses and liabilities which
might be incurred therein or thereby.
(h) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, security or other document
unless requested in writing to do so by the holders of not less than a majority
in aggregate principal amount of the Convertible Notes then outstanding,
provided that if the Trustee determines in its discretion to make any such
investigation, then it
42
shall be entitled, upon reasonable prior notice and during normal business
hours, to examine the books and records and the premises of the Company,
personally or by agent or attorney, and the reasonable expenses of every such
examination shall be paid by the Company or, if paid by the Trustee or any
predecessor Trustee, shall be reimbursed by the Company upon demand.
(i) The permissive rights of the Trustee to do things enumerated in
this Indenture shall not be construed as a duty, and the Trustee shall not be
answerable for other than its negligence or willful misconduct.
(j) The Trustee shall not be responsible for the computation of any
adjustment to the Conversion Price or the amount of any Contingent Interest per
$1,000 principal amount of Convertible Notes or for any determination as to
whether an adjustment is required or Contingent Interest is payable and shall
not be deemed to have knowledge of any adjustment or Contingent Interest unless
and until it shall have received the notice from the Company contemplated by
Section 14.5(j) or 6.3, respectively.
(k) The rights, privileges, protections, immunities and benefits given
to the Trustee, including, but not limited to, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, whether as Agent or otherwise, and to each Agent, custodian and other
person employed to act hereunder;
SECTION 10.3 Individual Rights of the Trustee.
Subject to Sections 10.10 and 10.11, the Trustee in its individual or
any other capacity may become the owner or pledgee of Convertible Notes with the
same rights it would have if it were not the Trustee and may otherwise deal with
the Company or an Affiliate of the Company and receive, collect, hold and retain
collections from the Company with the same rights it would have if it were not
Trustee. Any Agent may do the same with like rights.
SECTION 10.4 Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as
to the validity, adequacy or priority of this Indenture or the Convertible
Notes. It shall not be accountable for the Company's use of the proceeds from
the Convertible Notes or any money paid to the Company or upon the Company's
direction under any provision of this Indenture. It shall not be responsible for
the use or application of any money received by any Paying Agent other than the
Trustee, and it shall not be responsible for any statement or recital herein or
any statement in the Convertible Notes or any other document in connection with
the sale of the Convertible Notes or pursuant to this Indenture other than its
certificate of authentication.
SECTION 10.5 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
known to a Trust Officer of the Trustee, the Trustee shall mail to each holder
of a Convertible Note a notice of the Default or Event of Default within 90 days
after such Default or Event of Default occurs. A Default or an Event of Default
shall not be considered known to a Trust Officer of the Trustee unless it is a
Default or Event of Default in the payment of principal or interest when due
under Section 9.1(a) or (b) or a Trust Officer of the Trustee shall have
received written notice thereof,
43
in accordance with this Indenture, from the Company or from the holders of a
majority in principal amount of the outstanding Convertible Notes. Except in the
case of a Default or Event of Default in payment of principal or interest
(including Contingent Interest, if any) or Liquidated Damages, if any, on any
Convertible Note, the Trustee may withhold the notice if and so long as a trust
committee of its officers in good faith determines that withholding the notice
is in the interest of the holders of the Convertible Notes.
SECTION 10.6 Reports by the Trustee to Holders.
Within 60 days after the reporting date stated in Section 13.10, the
Trustee shall mail to holders of Convertible Notes a brief report dated as of
such reporting date that complies with TIA Section 313(a) (but if no event
described in TIA Section 313(a) has occurred within twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with TIA Section 313(b)(2). The Trustee shall also transmit by mail all reports
as required by TIA Section 313(c).
A copy of each report at the time of its mailing to holders of
Convertible Notes shall be filed, at the expense of the Company, by the Trustee
with the Commission and each stock exchange or securities market, if any, on
which the Convertible Notes are listed. The Company shall timely notify the
Trustee when the Convertible Notes are listed or quoted on any stock exchange or
securities market.
SECTION 10.7 Compensation and Indemnity.
The Company and the Guarantor shall pay to the Trustee from time to
time, and the Trustee shall be entitled to, reasonable compensation for its
acceptance of this Indenture and its services hereunder. The Trustee's
compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Company and the Guarantor shall reimburse the Trustee
promptly upon request for all reasonable disbursements, advances and expenses
incurred or made by or on behalf of it in addition to the compensation for its
services. Such expenses may include the reasonable compensation, disbursements
and expenses of the Trustee's agents, counsel and other persons not regularly in
its employ.
The Company and the Guarantor shall indemnify, defend and hold the
Trustee and its directors, officers, employees and agents (collectively with the
Trustee the "Indemnitees") harmless from and against every loss, liability or
expense, including without limitation damages, fines, suits, actions, demands,
penalties, costs, out-of-pocket or incidental expenses, legal fees and expenses,
and the costs and expenses of defending any claim (collectively, "Losses"), that
may be imposed on, incurred by, or asserted against, any Indemnitee for or in
respect of the Trustee's (i) execution and delivery of this Indenture, (ii)
compliance or attempted compliance with or reliance upon any instruction or
other direction upon which the Trustee is authorized to rely pursuant to the
terms of this Indenture and (iii) performance under this Indenture except as set
forth in the next paragraph. Any Indemnitee shall notify the Company and the
Guarantor promptly of any claim for which it may seek indemnity under this
Section.
Neither the Company nor the Guarantor need reimburse any expense or
indemnify against any Loss incurred by the Trustee or any Indemnitee through its
own negligence or willful misconduct.
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The Trustee shall have a lien prior to the Convertible Notes on all
money or property held or collected by the Trustee to secure the Company's and
the Guarantor's payment obligations in this Section 10.7, except that held in
trust to pay principal and interest and Liquidated Damages, if any, on
Convertible Notes. Such liens and the Company's and the Guarantor's obligations
under this Section 10.7 shall survive the termination, satisfaction and
discharge of this Indenture and the resignation or removal of the Trustee for
any reason.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 9.1(e) or (f) occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
SECTION 10.8 Replacement of the Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 10.8.
The Trustee may resign at any time and be discharged from the trust
hereby created by so notifying the Company. The holders of a majority in
principal amount of the then outstanding Convertible Notes may remove the
Trustee by so notifying the Trustee and the Company in writing and may appoint a
successor Trustee. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 10.10;
(2) the Trustee is adjudged a bankrupt or an insolvent or
an order for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(3) a Custodian or public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the holders
of a majority in principal amount of the then outstanding Convertible Notes may
appoint a successor Trustee to replace the successor Trustee appointed by the
Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company, the
Guarantor or the holders of at least 10% in principal amount of the then
outstanding Convertible Notes may petition any court of competent jurisdiction
for the appointment of a successor Trustee.
If the Trustee after written request by any holder of a Convertible
Note who has been a holder for at least six months fails to comply with Section
10.10, such holder may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
45
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to holders of Convertible Notes. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, provided
that all sums owing to the retiring Trustee hereunder have been paid and subject
to the lien provided for in Section 10.7. Notwithstanding the replacement of the
Trustee pursuant to this Section 10.8, the Company's and the Guarantor's
obligations under Section 10.7 shall continue for the benefit of the retiring
Trustee with respect to expenses and liabilities incurred by it prior to such
replacement.
Upon request of any such successor Trustee, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all such rights, powers and trusts referred to in the
preceding paragraph.
SECTION 10.9 Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business (including the trust
created by this Indenture) to, another person, by sale or otherwise, the
resulting, surviving or transferee person without any further act shall be the
successor Trustee with the same effect as if the successor Trustee had been
named as the Trustee herein.
SECTION 10.10 Eligibility, Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1). The Trustee shall always have a combined
capital and surplus as stated in Section 13.10. The Trustee is subject to TIA
Section 310(b) regarding the disqualification of a trustee upon acquiring a
conflicting interest; provided that the Indenture, dated as of February 1, 2002,
among the Trustee, the Company and the Guarantor, and the Indentures, dated as
of October 1, 1987 and July 31, 1989, between the Trustee and the Guarantor, and
the securities issued and to be issued thereunder shall be deemed to be
specifically described in this Indenture for the purpose of clause (i) of the
first proviso contained in TIA Section 310(b).
SECTION 10.11 Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship set forth in TIA Section 311(b). A Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated therein.
ARTICLE 11
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.1 Discharge of Indenture.
When (a) the Company delivers to the Trustee for cancellation all
Convertible Notes theretofore authenticated (other than any other Convertible
Notes which have been destroyed,
46
lost or stolen and in lieu of or in substitution for which other Convertible
Notes have been authenticated and delivered) and not theretofore canceled, or
(b) all the Convertible Notes not theretofore canceled or delivered to the
Trustee for cancellation have become due and payable, or by their terms will
become due and payable within one year and the Company or the Guarantor deposits
with the Trustee, in trust, amounts sufficient to pay at maturity all of the
Convertible Notes (other than any Convertible Notes which have been mutilated,
destroyed, lost or stolen and in lieu of or in substitution for which other
Convertible Notes have been authenticated and delivered) not theretofore
canceled or delivered to the Trustee for cancellation, including principal and
interest (including Contingent Interest, if any) and Liquidated Damages, if any,
due or to become due to such date of maturity, and if in either case the Company
or the Guarantor also pays, or causes to be paid, all other sums payable
hereunder by the Company, then this Indenture shall cease to be of further
effect (except as to (i) rights of registration of transfer, substitution,
replacement and exchange and conversion of Convertible Notes, (ii) rights
hereunder of holders of Convertible Notes to receive payments of principal of
and interest (including Contingent Interest, if any) and Liquidated Damages, if
any, on, the Convertible Notes, (iii) the obligations under Sections 2.3 and
11.5 hereof and (iv) the rights, obligations and immunities of the Trustee
hereunder), and the Trustee, on demand of the Company accompanied by an
Officers' Certificate and an Opinion of Counsel as required by Section 13.4, and
at the Company's cost and expense, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture; the Company,
however, hereby agrees to reimburse the Trustee for any costs or expenses
thereafter reasonably and properly incurred by the Trustee and to compensate the
Trustee for any services thereafter reasonably and properly rendered by the
Trustee in connection with this Indenture or the Convertible Notes.
SECTION 11.2 Deposited Monies to Be Held in Trust by Trustee.
Subject to Section 11.4, all monies deposited with the Trustee pursuant
to Section 11.1 shall be held in trust and applied by it to the payment, either
directly or through the Paying Agent, to the holders of the particular
Convertible Notes for the payment of which such monies have been deposited with
the Trustee, of all sums due and to become due thereon for principal and
interest (including Contingent Interest, if any) and Liquidated Damages, if any.
SECTION 11.3 Paying Agent to Repay Monies Held.
Upon the satisfaction and discharge of this Indenture, all monies then
held by any Paying Agent (other than the Trustee) shall, upon the Company's
demand, be repaid to it or paid to the Trustee, and thereupon such Paying Agent
shall be released from all further liability with respect to such monies.
SECTION 11.4 Return of Unclaimed Monies.
Subject to the requirements of applicable law, any monies deposited
with or paid to the Trustee for payment of the principal of or interest
(including Contingent Interest and Liquidated Damages) on Convertible Notes and
not applied but remaining unclaimed by the holders thereof for two years after
the date upon which the principal of or interest (including Contingent Interest
and Liquidated Damages) on such Convertible Notes, as the case may be, have
become due and payable, shall be repaid to the Company by the Trustee on demand;
provided, however, that the
47
Company, or the Trustee at the request and expense of the Company, shall have
first caused notice of such payment to the Company to be mailed to each holder
of a Convertible Note entitled thereto no less than 30 days prior to such
payment and all liability of the Trustee shall thereupon cease with respect to
such monies; and the holder of any of the Convertible Notes shall thereafter
look only to the Company for any payment which such holder may be entitled to
collect unless an applicable abandoned property law designates another person.
In the absence of a written request from the Company or the Guarantor to return
unclaimed funds to the Company or the Guarantor, as the case may be, the Trustee
shall from time to time deliver all unclaimed funds held by it in any capacity
hereunder to or as directed by applicable escheat authorities, as determined by
the Trustee in its sole discretion, in accordance with the customary practices
and procedures of the Trustee. Any unclaimed funds held by the Trustee in any
capacity hereunder pursuant to this Section 11.4 shall be held uninvested and
without any liability for interest.
SECTION 11.5 Reinstatement.
If the Trustee or the Paying Agent is unable to apply any money in
accordance with Section 11.2 by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application, the Company's and the Guarantor's obligations under this Indenture
and the Convertible Notes shall be revived and reinstated as though no deposit
had occurred pursuant to Section 11.1 until such time as the Trustee or the
Paying Agent is permitted to apply all such money in accordance with Section
11.2; provided, however, that if the Company or the Guarantor makes any payment
of interest (including Contingent Interest and Liquidated Damages) on or
principal of any Convertible Note following the reinstatement of its
obligations, the Company or the Guarantor, as the case may be, shall be
subrogated to the rights of the holders thereof to receive such payment from the
money held by the Trustee or Paying Agent.
ARTICLE 12
AMENDMENTS
SECTION 12.1 Without the Consent of Holders.
The Company, the Guarantor and the Trustee may amend this Indenture or
the Convertible Notes without notice to or the consent of any holder of a
Convertible Note for the purposes of:
(a) curing any ambiguity or correcting or supplementing any defective
or inconsistent provision contained in this Indenture or making any other
changes in the provisions of this Indenture which the Company, the Guarantor and
the Trustee may deem necessary or desirable provided such amendment does not
materially and adversely affect the legal rights under the Indenture of the
holders of Convertible Notes.
(b) providing for uncertificated Convertible Notes in addition to or in
place of certificated Convertible Notes;
48
(c) evidencing the succession of another person to the Company and
providing for the assumption by such successor of the covenants and obligations
of the Company hereunder and in the Convertible Notes as permitted by Section
8.1;
(d) providing for conversion rights and/or repurchase rights of holders
of Convertible Notes in the event of consolidation, merger, share exchange or
sale of all or substantially all of the assets of the Company as required to
comply with Sections 8.1 and/or 14.6;
(e) reducing the Conversion Price;
(f) evidencing and providing for the acceptance of appointment under
this Indenture of a successor Trustee;
(g) making any changes that would provide the holders of the
Convertible Notes with any additional rights or benefits or that does not
adversely affect the legal rights under this Indenture of any such holder; or
(h) complying with the requirements of the Commission in order to
effect or maintain the qualification of the Indenture under the TIA.
SECTION 12.2 With the Consent of Holders.
Subject to Section 9.7, the Company, the Guarantor and the Trustee may
amend this Indenture or the Convertible Notes with the written consent of the
holders of at least a majority in principal amount of the then outstanding
Convertible Notes (including consents obtained in connection with a tender offer
or exchange offer for Convertible Notes).
Subject to Sections 9.4 and 9.7, the holders of a majority in principal
amount of the Convertible Notes then outstanding may also waive compliance in a
particular instance by the Company with any provision of this Indenture or the
Convertible Notes.
However, without the consent of each holder of a Convertible Note
affected, an amendment or waiver under this Section 12.2 may not (with respect
to any Convertible Notes held by a non-consenting holder):
(a) reduce the principal amount of Convertible Notes whose holders must
consent to an amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any
Convertible Note;
(c) reduce the rate of, or change the time for payment of, interest,
including Contingent Interest, defaulted interest, or Liquidated Damages on any
Convertible Note;
(d) reduce the Redemption Price, Repurchase Price or Fundamental Change
Payment or change the time at which the Convertible Notes may be redeemed
pursuant to Article 3 or must be purchased at the option of a holder pursuant to
Articles 4 or 5;
49
(e) waive a Default or Event of Default in the payment of principal of
or interest (including Contingent Interest, if any) or Liquidated Damages, if
any, on the Convertible Notes (except a rescission of acceleration of the
Convertible Notes by the holders of at least a majority in aggregate principal
amount of the Convertible Notes then outstanding and a waiver of the payment
default that resulted from such acceleration);
(f) make the principal of, or interest (including Contingent Interest)
or Liquidated Damages on, any Convertible Note payable in money other than as
provided for herein and in the Convertible Notes;
(g) make any change in the provisions of this Indenture relating to
waivers of past Defaults or Events of Default or the rights of holders of
Convertible Notes to receive payments of principal of, or interest (including
Contingent Interest) or Liquidated Damages on, the Convertible Notes;
(h) except as permitted herein (including Section 12.1(a)), increase
the Conversion Price or modify the provisions contained herein relating to
conversion of the Convertible Notes in a manner adverse to the holders thereof;
or
(i) make any change to the abilities of holders of Convertible Notes to
enforce their rights hereunder or the provisions of clauses (a) through (h) of
this Section 12.2.
To secure a consent of the holders of Convertible Notes under this
Section 12.2, it shall not be necessary for such holders to approve the
particular form of any proposed amendment or waiver, but it shall be sufficient
if such consent approves the substance thereof.
After an amendment or waiver under this Section 12.2 becomes effective,
the Company shall mail to holders of Convertible Notes a notice briefly
describing the amendment or waiver.
SECTION 12.3 Compliance with the Trust Indenture Act.
Every amendment to this Indenture or the Convertible Notes shall be set
forth in a supplemental indenture that complies with the TIA as then in effect.
SECTION 12.4 Revocation and Effect of Consents.
Until an amendment or waiver becomes effective, a consent to it by a
holder of a Convertible Note is a continuing consent by the holder and every
subsequent holder of a Convertible Note or portion of a Convertible Note that
evidences the same debt as the consenting holder's Convertible Note, even if
notation of the consent is not made on any Convertible Note. However, any such
holder or subsequent holder may revoke the consent as to his or her Convertible
Note or portion of a Convertible Note if the Trustee receives the notice of
revocation before the date on which the Trustee receives an Officers'
Certificate certifying that the holders of the requisite principal amount of
Convertible Notes have consented to the amendment or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the holders of Convertible Notes entitled to consent
to any amendment or waiver. If
50
a record date is fixed, then notwithstanding the provisions of the immediately
preceding paragraph, those persons who were holders of Convertible Notes at such
record date (or their duly designated proxies), and only those persons, shall be
entitled to consent to such amendment or waiver or to revoke any consent
previously given, whether or not such persons continue to be holders after such
record date. No consent shall be valid or effective for more than 90 days after
such record date unless consents from holders of the principal amount of
Convertible Notes required hereunder for such amendment or waiver to be
effective shall have also been given and not revoked within such 90-day period.
After an amendment or waiver becomes effective it shall bind every
holder of a Convertible Note, unless it is of the type described in clauses (a)
- (h) of Section 12.2. In such case, the amendment or waiver shall bind each
holder of a Convertible Note who has consented to it and every subsequent holder
of a Convertible Note or portion of a Convertible Note that evidences the same
debt as the consenting holder's Convertible Note.
SECTION 12.5 Notation on or Exchange of Convertible Notes.
Convertible Notes authenticated and delivered after the execution of
any supplemental indenture pursuant to this Article 12 may, and shall if
required by the Trustee, bear a notation in the form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Convertible Notes so modified as to conform, in the opinion of
the Company and the Trustee, to any such supplemental indenture may be prepared
and executed by the Company and authenticated and delivered by the Trustee in
exchange for outstanding Convertible Notes without charge to the holders of the
Convertible Notes, except as specified in Section 2.6.
SECTION 12.6 Trustee Protected.
The Trustee shall sign any amendment or supplemental indenture
authorized pursuant to this Article 12 if such amendment or supplemental
indenture does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If such amendment or supplemental indenture does
adversely affect the rights, duties, liabilities or immunities of the Trustee,
the Trustee may, but need not, sign it. In signing such amendment or
supplemental indenture, the Trustee shall be entitled to receive, and shall be
fully protected in relying upon, an Officers' Certificate and an Opinion of
Counsel as conclusive evidence that such amendment or supplemental indenture is
authorized or permitted by this Indenture, that it is not inconsistent herewith,
and that it will be valid and binding upon the Company in accordance with its
terms.
ARTICLE 13
GENERAL PROVISIONS
SECTION 13.1 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA Section 318(c), such duties imposed by such section of
the TIA shall control. If any provision of this Indenture expressly modifies or
excludes any provision of the TIA that may be so modified
51
or excluded, the Indenture provision so modifying or excluding such provision of
the TIA shall be deemed to apply.
SECTION 13.2 Notices.
Any notice or communication by the Company, the Guarantor or the
Trustee to the other parties is duly given if in writing and delivered in person
or mailed by first-class mail, with postage prepaid (registered or certified,
return receipt requested), or sent by facsimile or overnight air couriers
guaranteeing next day delivery, to the other party's address as stated in
Section 13.10. The Company, the Guarantor or the Trustee by notice to the other
may designate additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to holders of
Convertible Notes) shall be deemed to have been duly given at the time delivered
by hand if personally delivered; five business days after being deposited in the
mail, postage prepaid, if mailed; when transmission is confirmed, if transmitted
by facsimile; and the next business day after timely delivery to the courier, if
sent by overnight air courier guaranteeing next day delivery. Notwithstanding
the foregoing, all notices to the Trustee shall be effective only upon receipt
by a Trust Officer.
Any notice or communication to a holder of a Convertible Note shall be
mailed by first-class mail, with postage prepaid, to his or her address shown on
the Register kept by the Registrar. Failure to mail a notice or communication to
a holder or any defect in the notice or communication shall not affect its
sufficiency with respect to other holders.
If a notice or communication to a holder of a Convertible Note is sent
in the manner provided above within the time prescribed, it is duly given,
whether or not the addressee receives it.
If the Company sends a notice or communication to holders of
Convertible Notes, it shall send a copy to the Trustee and each Agent at the
same time.
All notices or communications shall be in writing.
SECTION 13.3 Communication by Holders with Other Holders.
Holders of the Convertible Notes may communicate pursuant to TIA
Section 312(b) with other holders with respect to their rights under this
Indenture or the Convertible Notes. The Company, the Trustee, the Registrar and
the Paying Agent shall have the protection of TIA Section 312(c).
SECTION 13.4 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company or the Guarantor to the
Trustee to take any action under this Indenture, the Company or the Guarantor,
as the case may be, shall furnish to the Trustee:
(1) an Officers' Certificate in form and substance
reasonably satisfactory to the Trustee (which shall include the statements set
forth in Section 13.5) stating that, in the
52
opinion of such person, all conditions precedent provided for in this Indenture
(including any covenants, compliance with which constitutes a condition
precedent) relating to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 13.5) stating that, in the opinion of such counsel, all such conditions
precedent (including any covenants, compliance with which constitutes a
condition precedent) have been complied with.
SECTION 13.5 Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA Section 314(a)(4)) shall include:
(1) a statement that the person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(3) a statement that, in the opinion of such person, he or
she has made such examination or investigation as is necessary to enable him or
her to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether or not, in the opinion of
such person, such condition or covenant has been complied with.
Any Officers' Certificate may be based, insofar as it relates to legal
matters, upon an Opinion of Counsel, unless such Officer knows that the opinion
with respect to the matters upon which his or her certificate may be based as
aforesaid is erroneous. Any Opinion of Counsel may be based, insofar as it
relates to factual matters, upon certificates, statements or opinions of, or
representations by an officer or officers of the Company, or other persons or
firms deemed appropriate by such counsel, unless such counsel knows that the
certificates, statements or opinions or representations with respect to the
matters upon which his or her opinion may be based as aforesaid are erroneous.
Any Officers' Certificate, statement or Opinion of Counsel may be
based, insofar as it relates to accounting matters, upon a certificate or
opinion of or representation by an accountant (who may be an employee of the
Company,) or firm of accountants, unless such Officer or counsel, as the case
may be, knows that the certificate or opinion or representation with respect to
the accounting matters upon which his or her certificate, statement or opinion
may be based as aforesaid is erroneous.
53
SECTION 13.6 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by, or a meeting of,
holders of Convertible Notes. The Registrar or Paying Agent may make reasonable
rules and set reasonable requirements for its functions.
SECTION 13.7 Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in the City of New York or the city in which the Corporate Trust
Office of the Trustee is located are not required to be open, and a "business
day" is any day that is not a Legal Holiday. If a payment date is a Legal
Holiday at a place of payment, payment may be made at that place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue for the
intervening period. If any date specified in this Indenture is a Legal Holiday,
then such date shall be the next succeeding business day.
SECTION 13.8 No Recourse Against Others.
No director, officer, employee, shareholder or Affiliate, as such, of
the Company or the Guarantor from time to time shall have any liability for any
obligations of the Company or the Guarantor under the Convertible Notes or this
Indenture or for any claim based on, in respect of, or by reason of such
obligations or their creation. Each holder by accepting a Convertible Note
waives and releases all such liability. This waiver and release are part of the
consideration for the Convertible Notes. Each of such directors, officers,
employees, shareholders and Affiliates is a third party beneficiary of this
Section 13.8.
SECTION 13.9 Counterparts.
This Indenture may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.
SECTION 13.10 Other Provisions.
The Company initially appoints the Trustee as Paying Agent, Registrar
and authenticating agent.
The reporting date for Section 10.6 is May 15 of each year. The first
reporting date is the May 15 following the issuance of Convertible Notes
hereunder.
The Trustee shall always have, or shall be a subsidiary of a bank or
bank holding company which has, a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual report of
condition.
The Company's address is:
GATX Corporation.
000 Xxxx Xxxxxx Xxxxxx
00
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Treasurer
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
The Guarantor's Address is:
GATX Financial Corporation
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Treasurer
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
The Trustee's address is:
XX Xxxxxx Xxxxx Bank
c/o X.X. Xxxxxx Trust Company, National Association
000 Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Institutional Trust Services - Conventional Debt
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
SECTION 13.11 Governing Law.
The laws of the State of New York (including without limitation Section
5-1401 of the New York General Obligations Law or any successor to such statute)
shall govern this Indenture and the Convertible Notes.
SECTION 13.12 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company, the Guarantor or any of their respective
subsidiaries. Any such other indenture, loan or debt agreement may not be used
to interpret this Indenture.
SECTION 13.13 Successors.
All agreements of the Company and the Guarantor in this Indenture and
the Convertible Notes shall bind their respective successors. All agreements of
the Trustee in this Indenture shall bind its successor.
SECTION 13.14 Severability.
In case any provision in this Indenture or in the Convertible Notes
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
55
SECTION 13.15 Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.
ARTICLE 14
CONVERSION OF CONVERTIBLE NOTES
SECTION 14.1 Right to Convert.
Subject to and upon compliance with the provisions of this Indenture,
each holder of Convertible Notes shall have the right, at his or her option, at
any time on or before the close of business on the last Trading Day prior to the
Maturity Date to convert the principal amount of any Convertible Note held by
such holder, or any portion of such principal amount which is $1,000 or an
integral multiple thereof, into that number of fully paid and non-assessable
shares of Common Stock (as such shares shall then be constituted) obtained by
dividing the principal amount of the Convertible Note or portion thereof to be
converted by the Conversion Price in effect at such time, by surrender of the
Convertible Note so to be converted in whole or in part in the manner provided
in Section 14.2, if at least one of the following conditions is satisfied on the
Conversion Date irrespective of whether the Convertible Notes may otherwise be
convertible on such date:
(a) during a Conversion Period if the Sale Price of the Common Stock
for at least 20 Trading Days in a period of 30 consecutive Trading Days ending
on the last Trading Day preceding such Conversion Period equals or exceeds 120%
of the Conversion Price in effect at such time;
(b) during any period in which (i) the long-term credit rating assigned
to the Convertible Notes by Xxxxx'x Investors Service, Inc., or any successor
thereto ("Xxxxx'x"), is lower than Ba2 and the long-term credit rating assigned
to the Convertible Notes by Standard & Poor's Ratings Services, or any successor
thereto ("Standard & Poor's"), is lower than BB, (ii) both Moody's and Standard
& Poor's no longer rate the Convertible Notes or have withdrawn their ratings
with respect to the Convertible Notes, or (iii) either Xxxxx'x or Standard &
Poor's no longer rate the Convertible Notes or have withdrawn or suspended such
rating and the remaining rating is lower than Ba2 or BB, as applicable;
(c) at any time following the date the Company gives notice of
redemption pursuant to Section 3.3 and prior to the close of business on the
second business day immediately prior to the Redemption Date, if such
Convertible Note has been called for redemption pursuant to Article 3 hereof;
(d) during the five business day period after any five consecutive
Trading Day period in which the Trading Price of the Convertible Notes for each
Trading Day within that period is less than 95% of the Conversion Value of the
Convertible Notes during that period; provided, however, that no Convertible
Notes may be converted based on the satisfaction of this condition if on any day
during such five consecutive Trading Day period, the Sale Price of the Common
56
Stock is between the Conversion Price and 120% of the Conversion Price.
"Conversion Value" means the Sale Price of the Common Stock on each day in the
period multiplied by a fraction of which (x) the numerator is $1,000 and (y) the
denominator is the applicable Conversion Price. "Trading Price" for purposes of
this Section 14.1(d) shall be determined as elsewhere in this Indenture, except
that if (i) the Bid Solicitation Agent cannot obtain at least one bid for $5
million principal amount of the Convertible Notes, or (ii) in the Company's
reasonable judgment, the bid quotations are not indicative of the secondary
market value of the Convertible Notes, then the Trading Price of the Convertible
Notes will be deemed to be less than 95% of the Conversion Value;
(e) the Company becomes a party to a consolidation, merger or binding
share exchange pursuant to which the Common Stock would be converted into cash,
securities or other property, in which case a holder may surrender Convertible
Notes for conversion at any time from and after the date which is 15 days prior
to the anticipated date of the transaction until 15 days after the actual
effective date of such transaction; or
(f) the Company elects to (i) distribute to all holders of Common Stock
rights entitling them to purchase, for a period expiring within 60 days after
the date of such distribution, shares of Common Stock at less than the Sale
Price on the date of such distribution or (ii) distribute to all holders of
Common Stock assets, debt securities or rights to purchase securities of the
Company, which distribution has a per share value as determined by the Company's
Board of Directors exceeding 10% of the Sale Price on the day preceding the
declaration date for such distribution. In the case of the foregoing clauses (i)
and (ii), the Company must notify the holders of Convertible Notes at least 20
days prior to the ex-dividend date for such distribution. Once the Company has
given such notice, holders may surrender their Convertible Notes for conversion
at any time thereafter until the earlier of the close of business on the
business day prior to the ex-dividend date or the Company's announcement that
such distribution will not take place; provided, however, that a holder of
Convertible Notes may not exercise its right to conversion if such holder will
or may otherwise participate in such distribution without conversion.
The Bid Solicitation Agent shall not be required to determine the
applicable Trading Prices of the Convertible Notes unless requested by the
Company. The Company shall not be required to deliver such request to the Bid
Solicitation Agent unless a holder of Convertible Notes provides the Company
with reasonable evidence that the Trading Price per $1,000 principal amount of
the Convertible Notes would be less than 95% of the Conversion Value. Upon the
submission of such evidence by such holder of Convertible Notes to the Company,
the Company shall instruct the Bid Solicitation Agent to determine the Trading
Price per $1,000 principal amount of the Convertible Notes beginning on the
immediately following Trading Day and on each successive Trading Day until the
Trading Price per $1,000 principal amount of the Convertible Notes is greater
than or equal to 95% of the Conversion Value for such Trading Day.
The Company shall notify the Trustee of the date on which the
Convertible Notes first become convertible, in the form of an Officers'
Certificate, which Officers' Certificate shall set forth the calculations, if
any, on which such determination was made.
57
So long as no Event of Default shall have occurred and be continuing,
the Company at its option, instead of delivering shares of Common Stock, may pay
the holder cash in an amount described in Section 14.2 for all or any portion of
the Convertible Notes delivered for conversion as more fully described in
Section 14.2; provided, however, that the Company shall have the right to pay
cash instead of delivering shares of Common Stock for Convertible Notes
submitted for conversion on or after the second business day preceding the
Maturity Date only if the Company shall have delivered the notice described in
Section 14.2 no later than the fourth business day preceding the Maturity Date.
Convertible Notes (or portions thereof) in respect of which a holder
has delivered a repurchase notice exercising the option of such holder to
require the Company to repurchase such Convertible Notes pursuant to Articles 4
or 5 may be converted only if the repurchase notice is withdrawn in accordance
with the terms of this Indenture. A holder of Convertible Notes is not entitled
to any rights of a holder of Common Stock until such holder of Convertible Notes
has converted his or her Convertible Notes to Common Stock, and only to the
extent such Convertible Notes are deemed to have been converted to Common Stock
under this Article 14.
SECTION 14.2 Exercise of Conversion Privilege; Issuance of Common Stock on
Conversion; No Adjustment for Interest or Dividends.
To exercise, in whole or in part, the conversion privilege with respect
to any Convertible Note, the holder of such Convertible Note shall surrender
such Convertible Note, duly endorsed, at an office or agency maintained by the
Company pursuant to Section 7.4, accompanied by the funds, if any, required by
the final paragraph of this Section 14.2 and a duly signed and completed written
notice of conversion in the form provided on the Convertible Notes (or such
other notice which is acceptable to the Company) to the office or agency that
the holder of Convertible Notes elects to convert such Convertible Note or such
portion thereof specified in said notice. Such notice shall also state the name
or names (with address or addresses) in which the certificate or certificates
for shares of Common Stock which are issuable on such conversion shall be
issued, and shall be accompanied by transfer taxes, if required pursuant to
Section 14.7. Each such Convertible Note surrendered for conversion shall,
unless the shares issuable on conversion are to be issued in the same name as
the registration of such Convertible Note, be duly endorsed by, or be
accompanied by instruments of transfer in form satisfactory to the Company duly
executed by, the holder of Convertible Notes or his or her duly authorized
attorney. The holder of such Convertible Notes will not be required to pay any
tax or duty which may be payable in respect of the issue or delivery of Common
Stock on conversion, but will be required to pay any tax or duty which may be
payable in respect of any transfer involved in the issue or delivery of Common
Stock in a name other than the same name as the registration of such Convertible
Note. The date on which the holder of Convertible Notes satisfies each of the
requirements provided in this paragraph shall be referred to as the "Conversion
Date."
No later than the second business day after the Conversion Date, the
Company shall notify each holder of Convertible Notes that has satisfied the
delivery requirements in the prior paragraph and the Trustee whether the Company
elects to pay cash instead of delivering shares of Common Stock upon the
conversion of Convertible Notes and, if so, the percentage of the aggregate
principal amount of Convertible Notes in respect of which it shall pay in cash.
If the Company elects to deliver only shares of Common Stock upon conversion
(subject to Section
58
14.3), the Company shall issue and shall deliver to such holder at the office or
agency maintained by the Company for such purpose pursuant to Section 7.4, (1)
no later than the fifth business day after the Conversion Date, a certificate or
certificates for the number of full shares of Common Stock issuable upon the
conversion of such Convertible Note and (2) a check or cash in an amount
calculated pursuant to Section 14.3 in respect of any fractional interest in
respect of a share of Common Stock arising upon such conversion no later than
the tenth business day after the Conversion Date. If the Company elects to pay
cash instead of delivering shares of Common Stock for all or any portion of the
Convertible Notes being converted, the Company shall issue and shall deliver to
such holder at the office or agency maintained by the Company for such purpose
pursuant to Section 7.4, no later than the tenth business day after the
Conversion Date, (1) a certificate or certificates for the number, if any, of
full shares of Common Stock issuable upon the conversion of such Convertible
Notes in respect of which the Company elects to deliver shares of Common Stock
and (2) a check or cash in an amount equal to (a) the aggregate principal amount
of Convertible Notes in respect of which the Company elects to pay cash instead
of delivering shares of Common Stock divided by the Conversion Price and then
multiplied by the average of the Sale Prices of the Common Stock for each
Trading Day in the five Trading Day period immediately following the date on
which the Company delivers the notice described in this paragraph plus (b) an
amount calculated pursuant to Section 14.3 in respect of any fractional of the
interest in respect of a share of Common Stock arising upon such conversion.
Unless an Event of Default has occurred, the Company may not change its
election with respect to the consideration to be delivered upon conversion of a
Convertible Note once the Company has provided the notice described in the
previous paragraph. If an Event of Default (other than a default in the payment
of cash upon conversion of the Convertible Notes) has occurred and is
continuing, the Company may not pay cash upon conversion of any Convertible
Notes (other than cash in lieu of fractional shares as described in Section
14.3).
Certificates representing shares of Common Stock will not be issued or
delivered unless all taxes and duties, if any, payable by the holder have been
paid. In case any Convertible Note of a denomination of an integral multiple
greater than $1,000 is surrendered for partial conversion, the Company shall
execute, and the Trustee shall authenticate and deliver to the holder of the
Convertible Note so surrendered, without charge to him or her, a new Convertible
Note or Convertible Notes in authorized denominations in an aggregate principal
amount equal to the unconverted portion of the surrendered Convertible Note.
Each conversion shall be deemed to have been effected as to any such
Convertible Note (or portion thereof) on the applicable Conversion Date, and the
person in whose name any certificate or certificates for shares of Common Stock
are issuable upon such conversion shall be deemed to have become on the
applicable Conversion Date the holder of record of the shares represented
thereby; provided, however, that any such surrender on any date when the
Company's stock transfer books are closed shall constitute the person in whose
name the certificates are to be issued as the record holder thereof for all
purposes on the next succeeding day on which such stock transfer books are open,
but such conversion shall be at the Conversion Price in effect on the date upon
which such Convertible Note is surrendered.
59
Any Convertible Note or portion thereof surrendered for conversion
during the period from the close of business on the Regular Record Date for any
interest payment through the close of business on the last business day
immediately preceding an Interest Payment Date shall be accompanied by payment,
in funds acceptable to the Company, of an amount equal to the interest
(including Contingent Interest, if any), otherwise payable on such Interest
Payment Date on the principal amount being converted; provided however, that no
such payment need be made if (x) the Company has specified a Redemption Date
that falls within this period, (y) a Fundamental Change Expiration Date occurs
within this period or (z) there exists at the time of conversion a default in
the payment of interest (including Contingent Interest, if any), on the
Convertible Notes. An amount equal to such payment shall be paid by the Company
on such Interest Payment Date to the holder of such Convertible Note at the
close of business on such Regular Record Date; provided, however, that if the
Company defaults in the payment of interest (including Contingent Interest, if
any), on such Interest Payment Date, such amount shall be paid to the person who
made such required payment. Except as provided above in this Section 14.2, no
adjustment shall be made for interest (including Contingent Interest, if any)
and Liquidated Damages, if any, accrued on any Convertible Note converted or for
dividends on any shares issued upon the conversion of such Convertible Note as
provided in this Article 14.
SECTION 14.3 Cash Payments in Lieu of Fractional Shares.
No fractional shares of Common Stock or scrip representing fractional
shares shall be issued upon conversion of Convertible Notes. If more than one
Convertible Note shall be surrendered for conversion at one time by the same
holder, the number of full shares which shall be issuable upon conversion shall
be computed on the basis of the aggregate principal amount of the Convertible
Notes (or specified portions thereof to the extent permitted hereby) so
surrendered for conversion. If any fractional share of stock otherwise would be
issuable upon the conversion of any Convertible Note or Convertible Notes, the
Company shall make an adjustment therefor in cash based upon the average of the
Sale Prices of the Common Stock for each Trading Day in the five Trading Day
period immediately following the date on which the Company delivers the notice
described in Section 14.2.
SECTION 14.4 Conversion Price.
The conversion price shall be as specified in the form of Convertible
Note attached as Exhibit A hereto, subject to adjustment as provided in this
Article 14.
SECTION 14.5 Adjustment of Conversion Price.
The Conversion Price shall be adjusted from time to time by the Company
as follows:
(a) If the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of Common
Stock, the Conversion Price in effect at the opening of business on the date
following the date fixed for the determination of shareholders entitled to
receive such dividend or other distribution shall be reduced by multiplying such
Conversion Price by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the Record Date
(as defined in Section 14.5(g)) fixed for such determination and the denominator
shall be the sum of such number of shares and
60
the total number of shares constituting such dividend or other distribution,
such reduction to become effective immediately after the opening of business on
the day following the Record Date. If any dividend or distribution of the type
described in this Section 14.5(a) is declared but not so paid or made, the
Conversion Price shall again be adjusted to the Conversion Price which would
then be in effect if such dividend or distribution had not been declared.
(b) If the outstanding shares of Common Stock shall be subdivided into
a greater number of shares of Common Stock, the Conversion Price in effect at
the opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately reduced, and, conversely, if the
outstanding shares of Common Stock shall be combined into a smaller number of
shares of Common Stock, the Conversion Price in effect at the opening of
business on the day following the day upon which such combination becomes
effective shall be proportionately increased, such reduction or increase, as the
case may be, to become effective immediately after the opening of business on
the day following the day upon which such subdivision or combination becomes
effective.
(c) If the Company shall issue rights or warrants to all or
substantially all holders of its outstanding shares of Common Stock entitling
them to subscribe for or purchase shares of Common Stock at a price per share
less than the Current Market Price (as defined in Section 14.5(g)) on the Record
Date fixed for the determination of shareholders entitled to receive such rights
or warrants, the Conversion Price shall be adjusted so that the same shall equal
the price determined by multiplying the Conversion Price in effect at the
opening of business on the date after such Record Date by a fraction the
numerator of which shall be the number of shares of Common Stock outstanding at
the close of business on the Record Date plus the number of shares which the
aggregate offering price of the total number of shares so offered would purchase
at such Current Market Price, and the denominator of which shall be the number
of shares of Common Stock outstanding on the close of business on the Record
Date plus the total number of additional shares of Common Stock so offered for
subscription or purchase. Such adjustment shall become effective immediately
after the opening of business on the day following the Record Date fixed for
determination of shareholders entitled to receive such rights or warrants. To
the extent that shares of Common Stock are not delivered pursuant to such rights
or warrants, upon the expiration or termination of such rights or warrants the
Conversion Price shall be readjusted to be the Conversion Price which would then
be in effect had the adjustments made upon the issuance of such rights or
warrants been made on the basis of delivery of only the number of shares of
Common Stock actually delivered. If such rights or warrants are not so issued,
the Conversion Price shall again be adjusted to be the Conversion Price which
would then be in effect if such date fixed for the determination of shareholders
entitled to receive such rights or warrants had not been fixed. In determining
whether any rights or warrants entitle the holders to subscribe for or purchase
shares of Common Stock at less than such Current Market Price, and in
determining the aggregate offering price of such shares of Common Stock, there
shall be taken into account any consideration received for such rights or
warrants, with the value of such consideration, if other than cash, to be
determined by the Board of Directors of the Company.
(d) If the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock shares of any class of capital stock of the Company
(other than any dividends or distributions to which Section 14.5(a) applies) or
evidences of its indebtedness, cash or other assets (including securities, but
excluding (i) any rights or warrants of a type referred to in
61
Section 14.5(c) and (ii) dividends and distributions paid exclusively in cash)
(the foregoing hereinafter in this Section 14.5(d) called the "Securities"),
then, in each such case, the Conversion Price shall be reduced so that the same
shall be equal to the price determined by multiplying the Conversion Price in
effect immediately prior to the close of business on the Record Date (as defined
in Section 14.5(g)) with respect to such distribution by a fraction the
numerator of which shall be the Current Market Price (determined as provided in
Section 14.5(g)) on such date less the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and described in a
resolution of the Board of Directors) on such date of the portion of the
Securities so distributed applicable to one share of Common Stock and the
denominator of which shall be such Current Market Price, such reduction to
become effective immediately prior to the opening of business on the day
following the Record Date; provided, however, that in the event the then fair
market value (as so determined) of the portion of the Securities so distributed
applicable to one share of Common Stock is equal to or greater than the Current
Market Price on the Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each holder of Convertible Notes shall have the
right to receive upon conversion of a Convertible Note (or any portion thereof)
the amount of Securities such holder would have received had such holder
converted such Convertible Note (or portion thereof) immediately prior to such
Record Date. If such dividend or distribution is not so paid or made, the
Conversion Price shall again be adjusted to be the Conversion Price which would
then be in effect if such dividend or distribution had not been declared. If the
Board of Directors determines the fair market value of any distribution for
purposes of this Section 14.5(d) by reference to the actual or when issued
trading market for any securities comprising all or part of such distribution,
it must in doing so consider the prices in such market over the same period used
in computing the Current Market Price pursuant to Section 14.5(g) to the extent
possible.
Notwithstanding any other provision of this Section 14.5(d) to the
contrary, rights, warrants, evidences of indebtedness, other securities, cash or
other assets (including, without limitation, any rights distributed pursuant to
any shareholder rights plan) shall be deemed not to have been distributed for
purposes of this Section 14.5(d) if the Company makes proper provision so that
each holder of Convertible Notes who converts a Convertible Note (or any portion
thereof) after the date fixed for determination of shareholders entitled to
receive such distribution shall be entitled to receive upon such conversion, in
addition to the shares of Common Stock issuable upon such conversion, the amount
and kind of such distributions that such holder would have been entitled to
receive if such holder had, immediately prior to such determination date,
converted such Convertible Note into Common Stock.
Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights or warrants, until the occurrence of a specified event or events
("Trigger Event"): (i) are deemed to be transferred with such shares of Common
Stock; (ii) are not exercisable; and (iii) are also issued in respect of future
issuances of Common Stock, shall be deemed not to have been distributed for
purposes of this Section 14.5(d) (and no adjustment to the Conversion Price
under this Section 14.5(d) shall be required) until the occurrence of the
earliest Trigger Event, whereupon such rights and warrants shall be deemed to
have been distributed and an appropriate adjustment to the Conversion Price
under this Section 14.5(d) shall be made. If any such rights or warrants,
including any such existing rights or warrants distributed prior to the date of
this Indenture, are subject to subsequent events, upon the
62
occurrence of each of which such rights or warrants shall become exercisable to
purchase different securities, evidences of indebtedness or other assets, then
the occurrence of each such event shall be deemed to be such date of issuance
and record date with respect to new rights or warrants (and a termination or
expiration of the existing rights or warrants without exercise by the holder
thereof). In addition, in the event of any distribution (or deemed distribution)
of rights or warrants, or any Trigger Event with respect thereto, that was
counted for purposes of calculating a distribution amount for which an
adjustment to the Conversion Price under this Section 14.5 was made, (1) in the
case of any such rights or warrants which shall all have been redeemed or
repurchased without exercise by any holders thereof, the Conversion Price shall
be readjusted upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price received by
a holder or holders of Common Stock with respect to such rights or warrants
(assuming such holder had retained such rights or warrants), made to all holders
of Common Stock as of the date of such redemption or repurchase, and (2) in the
case of such rights or warrants which shall have expired or been terminated
without exercise by any holders thereof, the Conversion Price shall be
readjusted as if such rights and warrants had not been issued.
For purposes of this Section 14.5(d) and Sections 14.5(a) and (c), any
dividend or distribution to which this Section 14.5(d) is applicable that also
includes shares of Common Stock, or rights or warrants to subscribe for or
purchase shares of Common Stock to which Section 14.5(c) applies (or both),
shall be deemed instead to be (1) a dividend or distribution of the evidences of
indebtedness, assets, shares of capital stock, rights or warrants other than
such shares of Common Stock or rights or warrants to which Section 14.5(c)
applies (and any Conversion Price reduction required by this Section 14.5(d)
with respect to such dividend or distribution shall then be made) immediately
followed by (2) a dividend or distribution of such shares of Common Stock or
such rights or warrants (and any further Conversion Price reduction required by
Sections 14.5(a) and (c) with respect to such dividend or distribution shall
then be made, except that (A) the Record Date of such dividend or distribution
shall be substituted as "the date fixed for the determination of shareholders
entitled to receive such dividend or other distribution", "Record Date fixed for
such determination" and "Record Date" within the meaning of Section 14.5(a) and
as "the date fixed for the determination of shareholders entitled to receive
such rights or warrants", "the Record Date fixed for the determination of the
shareholders entitled to receive such rights or warrants" and "such Record Date"
within the meaning of Section 14.5(c) and (B) any shares of Common Stock
included in such dividend or distribution shall not be deemed "outstanding at
the close of business on the date fixed for such determination" within the
meaning of Section 14.5(a)).
(e) (i) If on or prior to August 15, 2008, the Company shall pay any
dividend or make any other distribution to all holders of its Common Stock,
during any quarterly fiscal period of the Company, consisting exclusively of
cash, in an aggregate amount per share of Common Stock (the "Current Dividend
Rate") that is not equal to $0.32 as adjusted to reflect subdivisions,
combinations or reclassifications of the Common Stock (the "Prior Dividend
Rate"); then
(A) if the Current Dividend Rate is greater than the Prior
Dividend Rate, the Conversion Price shall be decreased to equal the price
determined by multiplying the Conversion
63
Price in effect immediately prior to the close of business on the Record Date
(as defined in Section 14.5(g)) with respect to such dividend or distribution by
a fraction of which (x) the numerator shall be the average of the Sale Prices
for the ten Trading Days ending on the date immediately preceding the
"ex-dividend" date for such dividend or distribution less the difference between
(a) the Current Dividend Rate and (b) the Prior Dividend Rate and (y) the
denominator shall be the average of the Sale Prices for the ten Trading Days
ending on the date immediately preceding the "ex-dividend" date for such
dividend or distribution; or
(B) if the Current Dividend Rate is less than the Prior
Dividend Rate, the Conversion Price shall be increased to equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the close of business on the Record Date (as defined in Section 14.5(g)) with
respect to such dividend or distribution by a fraction of which (x) the
numerator shall be the average of the Sale Prices for the ten Trading Days
ending on the date immediately preceding the "ex-dividend" date for such
dividend or distribution plus the difference between (a) the Prior Dividend Rate
and (b) the Current Dividend Rate and (y) the denominator shall be the average
of the Sale Prices for the ten Trading Days ending on the date immediately
preceding the "ex-dividend" date for such dividend or distribution; and
(ii) if, following August 15, 2008, the Company shall pay any dividend
or make any other distribution to all holders of its Common Stock consisting
exclusively of cash, if and to the extent that this dividend or distribution,
aggregated on a rolling twelve-month basis with all other such cash dividends
and distributions for which no adjustment has been made under this paragraph
(e), has a per share value exceeding 10% of the Sale Price of the Common Stock
on the Trading Day immediately preceding the declaration of the dividend or
distribution, then the Conversion Price shall be decreased to equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the close of business on the Record Date (as defined in Section 14.5(g)) with
respect to such dividend or distribution by a fraction of which (x) the
numerator shall be the average of the Sale Prices for the ten Trading Days
ending on the date immediately preceding the "ex-dividend" date for such
dividend or distribution less the aggregate amount per share of the dividends
and distributions for which the adjustment is being made and (y) the denominator
shall be the average of the Sale Prices for the ten Trading Days ending on the
date immediately preceding the "ex-dividend" date for such dividend or
distribution.
Any adjustment required by this paragraph (e) shall be effective immediately
after the close of business on the Record Date for such dividend or
distribution; provided that if the portion of the cash so distributed applicable
to one share of Common Stock is equal to or greater than the Sale Price of the
Common Stock on the Record Date, in lieu of any adjustment required by this
paragraph (e), adequate provision shall be made so that each holder of
Convertible Notes shall have the right to receive upon conversion the amount of
cash such holder would have received had such holder converted each Convertible
Note on the Record Date. If such dividend or distribution is not so paid or
made, the Conversion Price shall again be adjusted to be the Conversion Price
that would then be in effect if such dividend or distribution had not been
declared.
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Notwithstanding the foregoing, in no event will the Conversion Price be less
than $19.34, as adjusted pursuant to paragraphs (a), (b), (c), (d) and (f) of
this Section 14.5, which is referred to as the "minimum conversion price," as a
result of an adjustment pursuant to paragraph (e).
(f) In case the Company or any of its subsidiaries shall, at any time or from
time to time while any of the Convertible Notes are outstanding, make any
payment in respect of a tender offer for all or any portion of the Common Stock
(other than pursuant to any odd-lot tender offer) for cash or other
consideration, to the extent that the aggregate amount of cash and the fair
market value of any other consideration (as determined by the Board of
Directors, whose determination shall be conclusive and described in a resolution
of the Board of Directors), as of the last date tenders may be made pursuant to
such tender offer (the "Expiration Date"), paid per share in respect of such
tender offer, exceeds 110% of the Sale Price of Common Stock on the Trading Day
next preceding the Expiration Date, then such excess shall be the "Excess Amount
Per Share", and the Conversion Price shall be decreased 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 Expiration Date by a fraction:
(i) the numerator of which shall be equal to the Current Market Price
on the Expiration Date less such Excess Amount Per Share; and
(ii) the denominator of which shall be equal to the Current Market
Price on such date.
Such adjustment shall become effective immediately after the Expiration Date.
(g) For purposes of this Section 14.5, the following terms shall have
the meaning indicated:
(1) "closing price" with respect to any securities on any
day means the closing price on such day or, if no such sale takes place on such
day, the average of the reported high and low prices on such day, in each case
on the Nasdaq National Market or New York Stock Exchange, as applicable, or, if
such security is not listed or admitted to trading on such national market or
exchange, on the principal national securities exchange or quotation system on
which such security is quoted or listed or admitted to trading, or, if not
quoted or listed or admitted to trading on any national securities exchange or
quotation system, the average of the high and low prices of such security on the
over-the-counter market on the day in question as reported by the National
Quotation Bureau Incorporated, or a similar generally accepted reporting
service, or, if not so available, in such manner as furnished by any New York
Stock Exchange member firm selected from time to time by the Company's Board of
Directors for that purpose, or a price determined in good faith by the Company's
Board of Directors, whose determination shall be conclusive and described in a
resolution of the Company's Board of Directors.
(2) "Current Market Price" means the average of the daily
closing prices per share of Common Stock for the 10 consecutive Trading Days
immediately prior to the date in question; provided, however, that (1) if the
"ex" date (as hereinafter defined) for any event (other than the issuance or
distribution requiring such computation) that requires an adjustment to the
Conversion Price pursuant to Sections 14.5(a), (b), (c), (d), (e) or (f) occurs
during such 10 consecutive Trading Days, the closing price for each Trading Day
prior to the "ex" date for such
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other event shall be adjusted by multiplying such closing price by the same
fraction by which the Conversion Price is so required to be adjusted as a result
of such other event, (2) if the "ex" date for any event (other than the issuance
or distribution requiring such computation) that requires an adjustment to the
Conversion Price pursuant to Section 14.5(a), (b), (c), (d), (e) or (f) occurs
on or after the "ex" date for the issuance or distribution requiring such
computation and prior to the day in question, the closing price for each Trading
Day on and after the "ex" date for such other event shall be adjusted by
multiplying such closing price by the reciprocal of the fraction by which the
Conversion Price is so required to be adjusted as a result of such other event,
and (3) if the "ex" date for the issuance or distribution requiring such
computation is prior to the day in question, after taking into account any
adjustment required pursuant to clause (1) or (2) of this proviso, the closing
price for each Trading Day on or after such "ex" date shall be adjusted by
adding thereto the amount of any cash and the fair market value (as determined
by the Board of Directors in a manner consistent with any determination of such
value for purposes of Sections 14.5(d) or (f), whose determination shall be
conclusive and described in a resolution of the Board of Directors) of the
evidences of indebtedness, shares of capital stock or assets being distributed
applicable to one share of Common Stock as of the close of business on the day
before such "ex" date. For purposes of this paragraph, the term "ex" date, (1)
when used with respect to any issuance or distribution, means the first date on
which the Common Stock trades regular way on the relevant exchange or in the
relevant market from which the closing price was obtained without the right to
receive such issuance or distribution, (2) when used with respect to any
subdivision or combination of shares of Common Stock, means the first date on
which the Common Stock trades regular way on such exchange or in such market
after the time at which such subdivision or combination becomes effective, and
(3) when used with respect to any tender or exchange offer means the first date
on which the Common Stock trades regular way on such exchange or in such market
after the Expiration Date of such offer. Notwithstanding the foregoing, whenever
successive adjustments to the Conversion Price are called for pursuant to this
Section 14.5, such adjustments shall be made to the Current Market Price as may
be necessary or appropriate to effectuate the intent of this Section 14.5 and to
avoid unjust or inequitable results as determined in good faith by the Board of
Directors of the Company.
(3) "fair market value" shall mean the amount which a
willing buyer would pay a willing seller in an arm's length transaction.
(4) "Record Date" shall mean, with respect to any dividend,
distribution or other transaction or event in which the holders of Common Stock
have the right to receive any cash, securities or other property or in which the
Common Stock (or other applicable security) is exchanged for or converted into
any combination of cash, securities or other property, the date fixed for
determination of shareholders entitled to receive such cash, securities or other
property (whether such date is fixed by the Board of Directors of the Company or
by statute, contract or otherwise).
(h) The Company may make such reductions in the Conversion Price, in
addition to those required by Sections 14.5(a), (b), (c), (d), (e) and (f), as
the Board of Directors considers to be advisable to avoid or diminish any income
tax to holders of Common Stock or rights to purchase Common Stock resulting from
any dividend or distribution of stock (or rights to acquire stock) or from any
event treated as such for income tax purposes.
66
The Company from time to time may, to the extent permitted by law,
reduce the Conversion Price by any amount for any period of at least 20 days, if
the Board of Directors has made a determination that such reduction would be in
the Company's best interests, which determination shall be conclusive and
described in a resolution of the Board of Directors. The reduction in Conversion
Price shall be irrevocable during this period. Whenever the Conversion Price is
reduced pursuant to the preceding sentence, the Company shall mail to the
holders of Convertible Notes at his or her last address appearing on the
Register a notice of the reduction at least 15 days prior to the date the
reduced Conversion Price takes effect, and such notice shall state the reduced
Conversion Price and the period during which it will be in effect.
(i) No adjustment in the Conversion Price shall be required unless such
adjustment would require an increase or decrease of at least 1% of the
Conversion Price then in effect; provided, however, that any adjustments which
by reason of this Section 14.5(i) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article 14 shall be made by the Company and shall be made to the
nearest one hundredth of a cent or to the nearest one ten thousandth of a share,
as the case may be.
No adjustment need be made for a change in the par value or no par
value of the Common Stock.
Notwithstanding the foregoing provisions of Section 14.5(c) or (d), no
adjustment shall be made thereunder, nor shall an adjustment be made to the
ability of a holder of a Convertible Note to convert, for any distribution
described therein if the holder of a Convertible Note will otherwise participate
in the distribution without conversion of such holder's Convertible Notes.
(j) Whenever the Conversion Price is adjusted as herein provided, the
Company shall promptly file with the Trustee and any Conversion Agent other than
the Trustee an Officers' Certificate setting forth the Conversion Price after
such adjustment and setting forth a brief statement of the facts requiring such
adjustment. Promptly after delivery of such certificate, the Company shall
prepare a notice of such adjustment of the Conversion Price setting forth the
adjusted Conversion Price and the date on which each adjustment becomes
effective and shall mail such notice of such adjustment of the Conversion Price
to each holder of Convertible Notes at his or her last address appearing on the
Register of holders maintained for that purpose within 20 days of the effective
date of such adjustment; provided that no notice need be given in the case of
offsetting adjustments which result in no net change to the Conversion Price.
Failure to deliver such notice shall not affect the legality or validity of any
such adjustment.
(k) In any case in which this Section 14.5 provides that an adjustment
shall become effective immediately after a Record Date for an event, the Company
may defer until the occurrence of such event issuing to the holder of any
Convertible Note converted after such Record Date and before the occurrence of
such event the additional shares of Common Stock issuable upon such conversion
by reason of the adjustment required by such event over and above the Common
Stock issuable upon such conversion before giving effect to such adjustment.
(l) For purposes of this Section 14.5, the number of shares of Common
Stock at any time outstanding shall not include shares held in the treasury of
the Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common
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Stock. The Company shall not pay any dividend or make any distribution on shares
of Common Stock held in the treasury of the Company.
SECTION 14.6 Effect of Reclassification, Consolidation, Merger or Sale.
If any of the following events occur: (i) any reclassification or
change of the outstanding shares of Common Stock (other than a change in par
value, or from par value to no par value, or from no par value to par value, or
as a result of a subdivision or combination), (ii) any consolidation, merger,
share exchange or combination of the Company with another corporation as a
result of which holders of Common Stock shall be entitled to receive stock,
securities or other property or assets (including cash) with respect to or in
exchange for such Common Stock, or (iii) any sale or conveyance of the
properties and assets of the Company as an entirety or substantially as an
entirety to any other corporation as a result of which holders of Common Stock
shall be entitled to receive stock, securities or other property or assets
(including cash) with respect to or in exchange for such Common Stock, then the
Company or the successor or purchasing corporation, as the case may be, shall
execute with the Trustee a supplemental indenture (which shall comply with the
TIA as in force at the date of execution of such supplemental indenture if such
supplemental indenture is then required to so comply) providing that the
Convertible Notes shall be convertible into the kind and amount of shares of
stock and other securities or property or assets (including cash) receivable
upon such reclassification, change, consolidation, merger, share exchange,
combination, sale or conveyance by a holder of a number of shares of Common
Stock issuable upon conversion of the Convertible Notes (assuming, for such
purposes, a sufficient number of authorized shares of Common Stock available to
convert all such Convertible Notes) immediately prior to such reclassification,
change, consolidation, merger, share exchange, combination, sale or conveyance
assuming such holder of Common Stock did not exercise his or her rights of
election, if any, as to the kind or amount of securities, cash or other property
receivable upon such consolidation, merger, share exchange, sale or conveyance
(provided that, if the kind or amount of securities, cash or other property
receivable upon such consolidation, merger, share exchange, sale or conveyance
is not the same for each share of Common Stock in respect of which such rights
of election have not been exercised ("non- electing share"), then, for the
purposes of this Section 14.6, the kind and amount of securities, cash or other
property receivable upon such consolidation, merger, share exchange, sale or
conveyance for each non-electing share shall be deemed to be the kind and amount
so receivable per share by a plurality of the non-electing shares). Such
supplemental indenture shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article
14. If, in the case of any such reclassification, change, consolidation, merger,
share exchange, combination, sale or conveyance, the stock or other securities
and assets receivable thereupon by a holder of shares of Common Stock includes
shares of stock or other securities and assets of a corporation other than the
successor or purchasing corporation, as the case may be, in such
reclassification, change, consolidation, merger, share exchange, combination,
sale or conveyance, then such supplemental indenture shall also be executed by
such other corporation and shall contain such additional provisions to protect
the interests of the holders of the Convertible Notes as the Board of Directors
shall reasonably consider necessary by reason of the foregoing.
The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each holder of Convertible Notes at his or her address
appearing on the Register within
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20 days after execution thereof. Failure to deliver such notice shall not affect
the legality or validity of such supplemental indenture.
The above provisions of this Section 14.6 shall similarly apply to
successive reclassifications, changes, consolidations, mergers, share exchanges,
combinations, sales and conveyances.
If this Section 14.6 applies to any event or occurrence, Section 14.5
shall not apply.
SECTION 14.7 Taxes on Shares Issued.
The issue of stock certificates on conversions of Convertible Notes
shall be made without charge to the converting holder for any tax in respect of
the issue thereof. The Company shall not, however, be required to pay any tax
which may be payable in respect of any transfer involved in the issue and
delivery of stock in any name other than that of the holder of any Convertible
Note converted, and the Company shall not be required to issue or deliver any
such stock certificate unless and until the person or persons requesting the
issue thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
SECTION 14.8 Reservation of Shares; Shares to Be Fully Paid; Listing of
Common Stock.
The Company shall provide, free from preemptive rights, out of its
authorized but unissued shares or shares held in treasury, sufficient shares to
provide for the conversion of the Convertible Notes from time to time as such
Convertible Notes are presented for conversion.
Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value, if any, of the shares of Common Stock
issuable upon conversion of the Convertible Notes, the Company shall take all
corporate action which may, in the opinion of its counsel, be necessary in order
that the Company may validly and legally issue shares of such Common Stock at
such adjusted Conversion Price.
The Company covenants that all shares of Common Stock issued upon
conversion of Convertible Notes will be fully paid and non- assessable by the
Company and free from all taxes, liens and charges with respect to the issue
thereof.
The Company further covenants that as long as the Common Stock is
listed on the New York Stock Exchange, or its successor, the Company shall cause
all Common Stock issuable upon conversion of the Convertible Notes to be
eligible for such listing in accordance with, and at the times required under,
the requirements of such market, and if at any time the Common Stock becomes
quoted on the Nasdaq National Market or listed on any other national securities
exchange, the Company shall cause all Common Stock issuable upon conversion of
the Convertible Notes to be so quoted or listed and kept so quoted or listed.
SECTION 14.9 Responsibility of Trustee.
The Trustee shall not at any time be under any duty of responsibility
to any holders of Convertible Notes to determine whether any facts exist which
may require any adjustment of the
69
Conversion Price, or with respect to the nature or extent or calculation of any
such adjustment when made, or with respect to the method employed, or herein or
in any supplemental indenture provided to be employed, in making the same. The
Trustee shall not be accountable with respect to the validity or value (or the
kind or amount) of any shares of Common Stock, or of any securities or property,
which may at any time be issued or delivered upon the conversion of any
Convertible Note; and the Trustee makes no representations with respect thereto.
Subject to the provisions of Section 10.1, the Trustee shall not be responsible
for any failure of the Company to issue, transfer or deliver any shares of
Common Stock or stock certificates or other securities or property or cash upon
the surrender of any Convertible Note for the purpose of conversion or to comply
with any of the duties, responsibilities or covenants of the Company contained
in this Article 14. Without limiting the generality of the foregoing, the
Trustee shall not have any responsibility to determine the correctness of any
provisions contained in any supplemental indenture entered into pursuant to
Section 14.6 relating either to the kind or amount of shares of stock or
securities or property (including cash) receivable by holders of Convertible
Notes upon the conversion of their Convertible Notes after any event referred to
in such Section 14.6 or to any adjustment to be made with respect thereto, but,
subject to the provisions of Section 10.1, may accept as conclusive evidence of
the correctness of any such provisions, and shall be protected in relying upon,
the Officers' Certificate and Opinion of Counsel (which the Company shall be
obligated to file with the Trustee prior to the execution of any such
supplemental indenture) with respect thereto.
SECTION 14.10 Notice to Holders Prior to Certain Actions.
If
(a) the Company declares a dividend (or any other distribution) on its
Common Stock (other than in cash out of retained earnings); or
(b) the Company authorizes the granting to all or substantially all of
the holders of its Common Stock of rights or warrants to subscribe for or
purchase any share of any class of Common Stock or any other rights or warrants
(other than rights or warrants referred to in the second paragraph of Section
14.5(d)); or
(c) there is any reclassification of the Common Stock (other than a
subdivision or combination of outstanding Common Stock, or a change in par
value, or from par value to no par value, or from no par value to par value), or
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 the sale
or transfer of all or substantially all of the assets of the Company; or
(d) there is any voluntary or involuntary dissolution, liquidation or
winding-up of the Company;
then the Company shall cause to be filed with the Trustee and to be mailed to
each holder of Convertible Notes at his or her address appearing on the Register
maintained for that purpose as promptly as possible but in any event at least 15
days prior to the applicable date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend,
distribution or rights or warrants, or, if a record is not to be taken, the date
as of which
70
the holders of Common Stock of record to be entitled to such dividend,
distribution or rights are to be determined, or (y) the date on which such
reclassification, consolidation, merger, share exchange, sale, transfer,
dissolution, liquidation or winding-up is expected to become effective or occur,
and the date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their Common Stock for securities or other
property deliverable upon such reclassification, consolidation, merger, share
exchange, sale, transfer, dissolution, liquidation or winding-up. Failure to
give such notice, or any defect therein, shall not affect the legality or
validity of such dividend, distribution, reclassification, consolidation,
merger, share exchange, sale, transfer, dissolution, liquidation or winding-up.
SECTION 14.11 Restriction on Common Stock Issuable Upon Conversion.
(a) Shares of Common Stock to be issued upon conversion of Convertible
Notes prior to the effectiveness of a Shelf Registration Statement shall be
physically delivered in certificated form to the holders converting such
Convertible Notes, and the certificate representing such shares of Common Stock
shall bear the Restricted Common Stock Legend unless removed in accordance with
Section 14.11(c).
(b) If (i) shares of Common Stock to be issued upon conversion of a
Convertible Note prior to the effectiveness of a Shelf Registration Statement
are to be registered in a name other than that of the holder of such Convertible
Note or (ii) shares of Common Stock represented by a certificate bearing the
Restricted Common Stock Legend are transferred subsequently by such holder,
then, unless the Shelf Registration Statement has become effective and such
shares are being transferred pursuant to the Shelf Registration Statement, the
holder must deliver to the transfer agent for the Common Stock a certificate in
substantially the form of Exhibit C as to compliance with the restrictions on
transfer applicable to such shares of Common Stock, and neither the transfer
agent nor the registrar for the Common Stock shall be required to register any
transfer of such Common Stock not so accompanied by a properly completed
certificate.
(c) Except in connection with a Shelf Registration Statement, if
certificates representing shares of Common Stock are issued upon the
registration of transfer, exchange or replacement of any other certificate
representing shares of Common Stock bearing the Restricted Common Stock Legend,
or if a request is made to remove such Restricted Common Stock Legend from
certificates representing shares of Common Stock, the certificates so issued
shall bear the Restricted Common Stock Legend, or the Restricted Common Stock
Legend shall not be removed, as the case may be, unless there is delivered to
the Company such satisfactory evidence, which, in the case of a transfer made
pursuant to Rule 144 under the Securities Act, may include an opinion of counsel
as may be reasonably required by the Company, that neither the legend nor the
restrictions on transfer set forth therein are required to ensure that transfers
thereof comply with the provisions of Rule 144A, Rule 144 or Regulation S under
the Securities Act or that such shares of Common Stock are securities that are
not "restricted" within the meaning of Rule 144 under the Securities Act. Upon
provision to the Company of such reasonably satisfactory evidence, the Company
shall cause the transfer agent for the Common Stock to countersign and deliver
certificates representing shares of Common Stock that do not bear the legend.
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ARTICLE 15
GUARANTEE
SECTION 15.1 Terms of the Guarantee. Subject to the provisions of this
Article 15, the Guarantor hereby fully and unconditionally guarantees, to each
holder of a Convertible Note authenticated and delivered by the Trustee and to
the Trustee and its successors and assigns, irrespective of the validity or
enforceability of this Indenture, the Convertible Notes or the obligations of
the Company under this Indenture or the Convertible Notes, that: (i) the
principal of, and interest (including Contingent Interest, if any) and
Liquidated Damages, if any, on the Convertible Notes will be paid in full when
due, whether at maturity, by acceleration, upon redemption or repurchase
pursuant to Article 4 or 5 or otherwise, and interest on the overdue principal
and (to the extent permitted by law) interest and liquidated damages, if any, on
the Convertible Notes will be promptly paid in full; (ii) all other obligations
of the Company to the holders or the Trustee under this Indenture or the
Convertible Notes will be promptly paid in full or performed, all in accordance
with the terms of this Indenture and the Convertible Notes; and (iii) in case of
any extension of time in payment or renewal of any Convertible Notes or any of
such other obligations, they will be paid in full when due or performed in
accordance with the terms of the extension or renewal, whether at maturity, by
acceleration or otherwise. Failing payment when due of any amount so guaranteed,
or failing performance of any other obligation of the Company to the holders or
the Trustee, for whatever reason, the Guarantor will be obligated to pay, or to
perform or cause the performance of, the same before such failure becomes an
Event of Default. The Guarantor agrees that this is a guarantee of payment not a
guarantee of collection.
The Guarantor hereby agrees that its obligations with regard to this
Guarantee shall be unconditional, irrespective of the validity, regularity or
enforceability of the Convertible Notes or the obligations of the Company under
this Indenture, the absence of any action to enforce the same, the recovery of
any judgment against the Company or any other obligor with respect to this
Indenture, the Convertible Notes or the obligations of the Company under this
Indenture or the Convertible Notes, any action to enforce the same or any other
circumstances (other than complete performance) which might otherwise constitute
a legal or equitable discharge or defense of a guarantor. The Guarantor further,
to the extent permitted by law, hereby waives (a) demand, protest and notice of
any kind, (b) any defense that may arise by reason of the incapacity, lack of
authority, death or disability of any other person or the failure of the
Trustee, the holders or the Company (each a "Benefitted Party") to file or
enforce a claim against the estate (in administration, bankruptcy or any other
proceeding) of any other person, (c) notice of the existence, creation or
incurring of any new or additional indebtedness or obligation, (d) any right to
require a proceeding first against the Company or right to require the prior
disposition of the assets of the Company to meet its obligations, (e) any
defense based upon an election of remedies by a Benefitted Party, including but
not limited to an election at law which provides that the obligation of a surety
must be neither larger in amount nor in other respects more burdensome than that
of the principal, (f) any defense arising because of a Benefitted Party's
election, in any proceeding instituted under Bankruptcy Law, of the application
of 11 U.S.C. Section 1111(b)(2) or (g) any defense based on any borrowing or
grant of a security interest under 11 U.S.C. Section 364. The Guarantor hereby
covenants that the Guarantee will not be
72
discharged except by complete performance of the obligations contained in the
Convertible Notes, the Guarantee and this Indenture.
If any holder or the Trustee is required by any court or otherwise to
return to either the Company or the Guarantor, or any custodian acting in
relation to either the Company or the Guarantor, any amount paid by the Company
or the Guarantor to the Trustee or such holder, the Guarantee, to the extent
theretofore discharged, shall be reinstated in full force and effect. The
Guarantor agrees that it will not be entitled to any right of subrogation in
relation to the holders in respect of any obligations guaranteed hereby until
payment in full of all obligations guaranteed hereby. The Guarantor agrees that,
as between it, on the one hand, and the holders of Convertible Notes and the
Trustee, on the other hand, (x) the maturity of the obligations guaranteed
hereby may be accelerated as provided in Article 9 hereof for the purposes
hereof, notwithstanding any stay, injunction or other prohibition preventing
such acceleration in respect of the obligations guaranteed hereby, and (y) in
the event of any acceleration of such obligations as provided in Article 9
hereof, such obligations (whether or not due and payable) shall forthwith become
due and payable by the Guarantor for the purpose of its Guarantee.
SECTION 15.2 Limitation of the Guarantor's Liability. The Guarantor
acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated by this Indenture, including, without
limitation, the net proceeds of the sale of the Convertible Notes. The Guarantor
and by its acceptance hereof, each beneficiary hereof, hereby confirms that it
is its intention that the Guarantee not constitute a fraudulent transfer or
conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar federal, state or
foreign law to the extent applicable to the Guarantee. To effectuate the
foregoing intention, each such person hereby irrevocably agrees that the
obligation of the Guarantor under the Guarantee under this Article 15 shall be
limited to the maximum amount as will, after giving effect to such maximum
amount and all other (contingent or otherwise) liabilities of the Guarantor that
are relevant under such laws, result in the obligations of the Guarantor in
respect of such maximum amount not constituting a fraudulent conveyance.
[signature page follows]
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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly
executed and attested, all as of the date first above written, signifying their
agreements contained in this Indenture.
GATX CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President and Treasurer
GATX FINANCIAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President and Treasurer
JPMORGAN CHASE BANK, as Trustee
By: /s/ Xxxxx X. Xxxxx
------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
74
EXHIBIT A
(Face of Security)
[Global Securities Legend]
THIS NOTE HAS BEEN ISSUED WITH ORIGINAL ISSUE DISCOUNT, FOR PURPOSES OF
SECTIONS 1272, 1273, AND 1275 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
THE ISSUE PRICE OF THIS NOTE IS $1,000 PER $1,000 OF PRINCIPAL AMOUNT AT
MATURITY; THE ISSUE DATE OF THIS NOTE IS AUGUST 15, 2003; AND THE COMPARABLE
YIELD FOR THE PURPOSES OF ACCRUING ORIGINAL ISSUE DISCOUNT IS 7.5% PER ANNUM,
CALCULATED ON A SEMIANNUAL BOND EQUIVALENT BASIS. HOLDERS OF THIS NOTE MAY
OBTAIN INFORMATION REGARDING THE AMOUNT OF ORIGINAL ISSUE DISCOUNT, YIELD TO
MATURITY AND THE PROJECTED PAYMENT SCHEDULE FOR THIS NOTE BY SUBMITTING A
WRITTEN REQUEST FOR SUCH INFORMATION TO:
GATX CORPORATION, 000 XXXX XXXXXX
XXXXXX, XXXXXXX, XXXXXXXX 00000, ATTENTION: TREASURER.
[The following legend shall appear on the face of each Global Security:
THIS CONVERTIBLE NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE
DEPOSITARY OR A NOMINEE OF THE DEPOSITARY, WHICH MAY BE TREATED BY THE COMPANY,
THE TRUSTEE AND ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS CONVERTIBLE NOTE
FOR ALL PURPOSES.]
[The following legend shall appear on the face of each Global Security
for which The Depository Trust Company is to be the Depositary:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR
ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY THE AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR REGISTERED
CONVERTIBLE NOTES IN DEFINITIVE REGISTERED FORM IN THE LIMITED CIRCUMSTANCES
REFERRED TO IN THE INDENTURE, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED EXCEPT
AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF
THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY
A-1
OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE
OR SUCH SUCCESSOR DEPOSITARY.]
[Restricted Securities Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY OF THE
ISSUE HEREOF (OR ANY PREDECESSOR SECURITY HEREOF) OR (Y) BY ANY HOLDER THAT WAS
AN "AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE
COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER,
IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO LONG AS THIS SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (3) IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE
SECURITIES ACT) IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT, (4)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES
FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR
(2) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR
AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER)
REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT,
DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS
SECURITY OR ANY COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY EXCEPT AS
PERMITTED BY THE SECURITIES ACT.
A-2
No. $
--------------------- -------------------
CUSIP 361448 AD 5
GATX CORPORATION
5% SENIOR CONVERTIBLE NOTE DUE 2023
GATX Corporation promises to pay to
or registered assigns,
the principal sum of on August 15, 2023
Interest Payment Dates: February 15 and August 15, commencing February 15, 2004
Regular Record Dates: February 1 and August 1.
GATX CORPORATION
By:
---------------------------------
Title:
Certificate of Authentication
This is one of the Senior Convertible Notes described in the within- mentioned
Indenture.
JPMORGAN CHASE BANK,
as Trustee
By:
---------------------------------
Authorized Signatory
Dated:
A-3
(Back of Security)
A-4
GATX CORPORATION
5% SENIOR CONVERTIBLE NOTE DUE 2023
1. Interest.
GATX Corporation, a New York corporation (the "Company"),
promises to pay interest on the principal amount of this Convertible
Note at the rate per annum shown above. The Company will pay interest
semi-annually in arrears on February 15 and August 15 of each year,
beginning February 15, 2004. Interest on the Convertible Notes will
accrue from the most recent interest payment date to which interest has
been paid or, if no interest has been paid, from August 15, 2003.
Interest (including any Liquidated Damages) will be computed on the
basis of a 360-day year composed of twelve 30-day months and the actual
number of days elapsed in any partial month.
The Company shall also pay Contingent Interest to the holder of this
Convertible Note in respect of any six-month period from August 15 to
February 14 and from February 15 to August 14, commencing with the
six-month period beginning August 15, 2008, if the average Trading
Price for each $1,000 principal amount of the Convertible Notes for the
five Trading Day period ending on the second Trading Day immediately
preceding the first day of the relevant Contingent Interest Period
equals $1,200 (120% of the principal amount of a Convertible Note) or
more. The amount of Contingent Interest payable on each $1,000
principal amount of Convertible Notes with respect to any Contingent
Interest Period shall equal 0.25% of the average Trading Price for each
$1,000 principal amount of Convertible Notes for the applicable five
Trading Day period. Contingent Interest, if any, will accrue and be
paid on the February 15 or August 15 following each Contingent Interest
Period to holders in whose name any Convertible Note is registered with
the Registrar at the close of business on the preceding Regular Record
Date.
2. Method of Payment. The Company will pay interest (and Liquidated
Damages, if any) on the Convertible Notes (except defaulted interest)
to the person in whose name each Convertible Note is registered at the
close of business on the February 1 or August 1 immediately preceding
the relevant interest payment date (each a "Regular Record Date")
notwithstanding the conversion of the Convertible Notes at any time
after the close of business on a Regular Record Date and before the
next succeeding interest payment date (other than with respect to a
Convertible Note or portion thereof repurchased in connection with a
Fundamental Change on a repurchase date, during the period from the
close of business on a Regular Record Date to (but excluding) the next
succeeding interest payment date, in which case accrued interest (and
Liquidated Damages, if any) shall be payable to the holder of the
Convertible Note or portion thereof repurchased in accordance with the
applicable repurchase provisions of the Indenture). The holder must
surrender Convertible Notes to a Paying Agent to collect principal
payments. The Company will pay the principal of, and interest
(including Liquidated Damages, if any) on, the Convertible Notes at the
office or agency of the Company maintained for such purpose, in money
of the United States that at the time of payment is legal tender for
payment of public and private debts. Until otherwise designated by the
Company, the Company's office or agency maintained for such purpose
will be the principal Corporate Trust Office of the Trustee (as defined
below). However, the Company may pay principal, and interest (including
Liquidated Damages, if any) by wire transfer or by
A-5
check payable in such money, and may mail such check to the holders of
the Convertible Notes at their respective addresses as set forth in the
Register of holders of Convertible Notes.
3. Paying Agent and Registrar. JPMorgan Chase Bank (together with any
successor Trustee under the Indenture referred to below, the
"Trustee"), will act as Paying Agent and Registrar. The Company may
change the Paying Agent, Registrar or co-registrar without prior
notice. Subject to certain limitations in the Indenture, the Company or
any of its subsidiaries may act in any such capacity.
4. Indenture. The Company issued the Convertible Notes under an Indenture
dated as of August 15, 2003 (the "Indenture") by and among the Company,
the Guarantor and the Trustee. The terms of the Convertible Notes
include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code
(ss.ss.77aaa-77bbbb) (the "TIA") as in effect on the date of the
Indenture. The Convertible Notes are subject to, and qualified by, all
such terms, certain of which are summarized hereon, and holders are
referred to the Indenture and the TIA for a statement of such terms.
The Convertible Notes are unsecured general obligations of the Company
limited to (except as otherwise provided in the Indenture) $125,000,000
in aggregate principal amount. Capitalized terms not defined below have
the same meaning as is given them in the Indenture.
5. Redemption at the Option of the Company. Subject to the terms of
Article 3 of the Indenture, the Company may, at its option, redeem the
Convertible Notes for cash at any time as a whole, or from time to time
in part, on or after August 15, 2008, at a redemption price equal to
100% of the principal amount of Convertible Notes to be redeemed plus
any accrued and unpaid interest (including Contingent Interest, if any)
and Liquidated Damages, if any, on those Convertible Notes to, but not
including, the Redemption Date.
6. Repurchase at Option of Holder or upon a Fundamental Change. Subject to
the terms and conditions of Article 4 of the Indenture, the Company
shall become obligated to repurchase, at the option of the holder, all
or any portion of the Convertible Notes held by such holder on August
15, 2008, August 15, 2013 and August 15, 2018 in multiples of $1,000 at
a repurchase price equal to 100% of the principal amount of those
Convertible Notes plus accrued and unpaid interest (including
Contingent Interest, if any) and Liquidated Damages, if any, to, but
not including, such Repurchase Date. To exercise such right, a holder
must deliver to the Paying Agent a Repurchase Notice containing the
information set forth in the Indenture within the time period specified
in the Indenture.
On August 15, 2008, the Repurchase Price shall be paid in cash only. On
August 15, 2013 and August 15, 2018, the Repurchase Price may be paid,
at the option of the Company, in cash or by the issuance and delivery
of shares of Common Stock, or in any combination thereof, subject to
the terms and conditions of the Indenture.
Upon the occurrence of a Fundamental Change, the Company shall make a
Fundamental Change Offer to repurchase all outstanding Convertible
Notes at a price equal to 100% of the aggregate principal amount of the
Convertible Notes, plus accrued and unpaid interest
A-6
(including Contingent Interest, if any) and Liquidated Damages, if any
to, but not including, the date of repurchase, such offer to be made as
provided in the Indenture. To accept the Fundamental Change Offer, the
holder hereof must comply with the terms thereof, including
surrendering this Convertible Note, with the "Option of Holder to Elect
Repurchase" portion hereof completed, to the Company, a depositary, if
appointed by the Company, or a Paying Agent, at the address specified
in the notice of the Fundamental Change Offer mailed to holders as
provided in the Indenture, prior to termination of the Fundamental
Change Offer.
7. Denominations, Transfer and Exchange. The Convertible Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000. The transfer of Convertible Notes may be
registered and Convertible Notes may be exchanged as provided in the
Indenture. As a condition of transfer, the Registrar and the Trustee
may require a holder, among other things, to furnish appropriate
endorsements and transfer documents, and the Company and the Registrar
may require a holder to pay any taxes and fees required by law or
permitted by the Indenture. The Company or the Registrar need not
exchange or register the transfer of any Convertible Note or portion of
a Convertible Note submitted for repurchase.
8. Persons Deemed Owners. The registered holder of a Convertible Note may
be treated as its owner for all purposes.
9. Amendments and Waivers. Subject to certain exceptions, the Indenture or
the Convertible Notes may be amended or supplemented with the consent
of the holders of at least a majority in principal amount of the then
outstanding Convertible Notes, and any existing default may be waived
with the consent of the holders of a majority in principal amount of
the then outstanding Convertible Notes.
Without the consent of any holder, the Indenture or the Convertible
Notes may be amended to: (a) cure any ambiguity or correct or supplement any
defective or inconsistent provision contained in the Indenture, or make any
other changes in the provisions of the Indenture which the Company and the
Trustee may deem necessary or desirable provided such amendment does not
materially and adversely affect the legal rights under the Indenture of the
holders of Convertible Notes; (b) provide for uncertificated Convertible Notes
in addition to or in place of certificated Convertible Notes; (c) evidence the
succession of another person to the Company and providing for the assumption by
such successor of the covenants and obligations of the Company thereunder and in
the Convertible Notes as permitted by Section 8.1 of the Indenture; (d) provide
for conversion rights and/or repurchase rights of holders of Convertible Notes
in the event of consolidation, merger, share exchange or sale of all or
substantially all of the assets of the Company as required to comply with
Sections 8.1 and/or 14.6 of the Indenture; (e) reduce the Conversion Price; (f)
evidence and provide for the acceptance of the appointment under the Indenture
of a successor Trustee; (g) make any change that would provide any additional
rights or benefits to the holders of Convertible Notes or that does not
adversely affect the legal rights under the Indenture of any such holder; or (h)
comply with the requirements of the Commission in order to effect or maintain
the qualification of the Indenture under the TIA.
A-7
Without the consent of each holder affected, an amendment or waiver may
not (with respect to any Convertible Notes held by a non-consenting holder): (a)
reduce the principal amount of Convertible Notes whose holders must consent to
an amendment, supplement or waiver; (b) reduce the principal of or change the
fixed maturity of any Convertible Note; (c) reduce the rate of or change the
time for payment of interest, including defaulted interest, or Liquidated
Damages on any Convertible Notes; (d) reduce the Redemption Price, Repurchase
Price or Fundamental Change Payment or change the time at which the Convertible
Notes may be redeemed or must be repurchased at the option of a holder; (e)
waive a Default or Event of Default in the payment of principal of, or interest
or Liquidated Damages on, the Convertible Notes (except a rescission of
acceleration of the Convertible Notes by the holders of at least a majority in
aggregate principal amount of the Convertible Notes and a waiver of the payment
default that resulted from such acceleration); (f) make the principal of, or
interest or Liquidated Damages on, any Convertible Note payable in money other
than as provided for in the Indenture and in the Convertible Notes; (g) make any
change in the provisions of the Indenture relating to waivers of past Defaults
or the rights of holders of Convertible Notes to receive payments of principal
of, or interest or Liquidated Damages, on the Convertible Notes; (h) except as
permitted by the Indenture (including Section 12.1(a)), increase the Conversion
Price or modify the provisions of the Indenture relating to conversion of the
Convertible Notes in a manner adverse to the holders thereof or (i) make any
change to the ability of holders of Convertible Notes to enforce their rights
under the Indenture or the provisions of clauses (a) through (h) of Section 12.2
of the Indenture.
10. Defaults and Remedies. An Event of Default is: (a) default in payment
of the principal of the Convertible Notes, when due at maturity, upon
acceleration or otherwise or default in payment when due of the
Redemption Price, Repurchase Price or Fundamental Change Payment; (b)
default for 30 days or more in payment of any installment of interest
(including Contingent Interest, if any) or Liquidated Damages on the
Convertible Notes; (c) default by the Company for 60 days or more after
notice in the observance or performance of any other covenants in the
Indenture; (d) failure to provide timely notice of a Fundamental
Change; or (e) certain events involving bankruptcy, insolvency or
reorganization of the Company. If an Event of Default occurs and is
continuing, the Trustee or the holders of at least 25% in principal
amount of the then outstanding Convertible Notes may declare the unpaid
principal of, and accrued and unpaid interest (including Contingent
Interest, if any) and Liquidated Damages, if any, on, all Convertible
Notes then outstanding to be due and payable immediately, except that
in the case of an Event of Default arising from certain events of
bankruptcy, insolvency, or reorganization with respect to the Company,
all outstanding Convertible Notes become due and payable without
further action or notice. Holders of Convertible Notes may not enforce
the Indenture or the Convertible Notes except as provided in the
Indenture. The Trustee may require an indemnity satisfactory to it
before it enforces the Indenture or the Convertible Notes. Subject to
certain limitations, holders of a majority in principal amount of the
then outstanding Convertible Notes may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from holders
notice of any continuing default (except a default in payment of
principal, interest or Liquidated Damages, if applicable) if it
determines that withholding notice is in their interests. The Company
must furnish annual compliance certificates to the Trustee.
A-8
11. Guarantor. The Convertible Notes are fully and unconditionally
guaranteed by GATX Financial Corporation, a Delaware corporation,
pursuant to the terms of the Guarantee as specifically described in the
Indenture.
12. Trustee Dealings with the Company and the Guarantor. The Trustee or any
of its Affiliates, in their individual or any other capacities, may
make or continue loans to or guaranteed by, accept deposits from and
perform services for the Company or the Guarantor or their respective
Affiliates and may otherwise deal with the Company or the Guarantor or
their respective Affiliates as if it were not Trustee.
13. No Recourse Against Others. No director, officer, employee, shareholder
or Affiliate, as such, of the Company or the Guarantor shall have any
liability for any obligations of the Company or the Guarantor under the
Convertible Notes or the Indenture or for any claim based on, in
respect of or by reason of such obligations or their creation. Each
holder by accepting a Convertible Note waives and releases all such
liability. The waiver and release are part of the consideration for the
Convertible Notes.
14. Authentication. This Convertible Note shall not be valid until
authenticated by the manual signature of the Trustee or an
authenticating agent.
15. Abbreviations. Customary abbreviations may be used in the name of a
holder or an assignee, such as: TEN CO = tenants in common, TEN ENT =
tenants by the entireties, JT TEN = joint tenants with right of
survivorship and not as tenants in common, CUST = Custodian and U/G/M/A
= Uniform Gifts to Minors Act.
16. Conversion. Subject to and upon compliance with the provisions of the
Indenture, including the satisfaction of at least one of the conditions
in Section 14.1 of the Indenture on the Conversion Date, the registered
holder of this Convertible Note has the right to convert the principal
amount hereof, or any portion of such principal amount which is $1,000
or an integral multiple thereof, into that number of fully paid and
non-assessable shares of common stock of the Company ("Common Stock")
obtained by dividing the principal amount of the Convertible Note or
portion thereof to be converted by the conversion price of $23.6915 per
share, as adjusted from time to time as provided in the Indenture (the
"Conversion Price"), upon surrender of this Convertible Note to the
Company at the office or agency maintained for such purpose (and at
such other offices or agencies designated for such purpose by the
Company), accompanied by written notice of conversion duly executed
(and if the shares of Common Stock to be issued on conversion are to be
issued in any name other than that of the registered holder of this
Convertible Note by instruments of transfer, in form satisfactory to
the Company, duly executed by the registered holder or its duly
authorized attorney) and, in case such surrender shall be made during
the period from the close of business on the Regular Record Date
immediately preceding any Interest Payment Date through the close of
business on the last Trading Day immediately preceding such Interest
Payment Date, also accompanied (except as described in the Indenture)
by payment, in funds acceptable to the Company, of an amount equal to
the interest (including Contingent Interest, if any) otherwise payable
on such Interest Payment Date on the principal amount of this
Convertible Note then being converted. Convertible Notes (or any
portion thereof) in
A-9
respect of which a holder has delivered a repurchase notice exercising
the option of such holder to require the Company to repurchase such
Convertible Notes pursuant to Article 4 or Article 5 of the Indenture
may be converted only if the repurchase notice is withdrawn in
accordance with the terms of this Indenture. Subject to the aforesaid
requirement for a payment in the event of conversion after the close of
business on a Regular Record Date immediately preceding an Interest
Payment Date, no adjustment shall be made on conversion for interest
(including Contingent Interest, if any) or Liquidated Damages accrued
hereon or for dividends on Common Stock delivered on conversion. The
right to convert this Convertible Note is subject to the provisions of
the Indenture relating to conversion rights in the case of certain
consolidations, mergers, share exchanges or sales or transfers of
substantially all the Company's assets. So long as no Event of Default
shall have occurred and be continuing, the Company, at its option,
instead of delivering shares of Common Stock, may pay cash to the
holder of this Convertible Note upon conversion as provided in Article
14 of the Indenture. The Company shall not issue fractional shares or
scrip representing fractions of shares of Common Stock upon any such
conversion, but shall pay cash in lieu of such fractional shares in the
manner described in the Indenture.
17. Registration Agreement. The holder of this Convertible Note is entitled
to the benefits of a Registration Agreement, dated as of August 15,
2003, by and among the Company, the Guarantor and the Initial
Purchasers (the "Registration Agreement"). Pursuant to the Registration
Agreement, the Company has agreed for the benefit of the holders of the
Convertible Notes and the Common Stock issued and issuable upon
conversion of the Convertible Notes, that (i) it will, at its cost,
within 90 days after the Issue Date, file a shelf registration
statement (the "Shelf Registration Statement") with the Securities and
Exchange Commission (the "Commission") with respect to resales of the
Convertible Notes and the Common Stock issuable upon conversion
thereof, (ii) the Company will use its reasonable best efforts to cause
such Shelf Registration Statement to be declared effective by the
Commission under the Securities Act within 180 days after the Issue
Date and (iii) the Company will use its reasonable best efforts to keep
such Shelf Registration Statement continuously effective under the
Securities Act until the earliest of (a) the second anniversary of the
Issue Date or, if later, the second anniversary of the last date on
which any Convertible Notes are issued upon exercise of the Initial
Purchasers' over-allotment option, (b) the date on which the
Convertible Notes or the Common Stock issuable upon conversion thereof
may be sold by persons who are not "affiliates" (as defined in Rule
144) of the Company pursuant to paragraph (k) of Rule 144 (or any
successor provision) promulgated by the Commission under the Securities
Act, (c) the date as of which all of the Convertible Notes or the
Common Stock issuable upon conversion thereof have been transferred
pursuant to Rule 144 under the Securities Act (or any similar provision
then in force) and (d) the date as of which all the Convertible Notes
or the Common Stock issuable upon conversion thereof have been sold
pursuant to such Shelf Registration Statement.
If the Shelf Registration Statement (i) is not filed with the
Commission on or prior to 90 days, or has not been declared effective by the
Commission within 180 days, after the Issue Date or (ii) is filed and declared
effective but shall thereafter cease to be effective (without being succeeded
immediately by a replacement shelf registration statement filed and declared
A-10
effective) or cease to be usable (including, without limitation, as a result of
a Suspension Period as defined below) for the offer and sale of Transfer
Restricted Securities (as defined below) for a period of time (including any
Suspension Period) which shall exceed 90 days in the aggregate in any 12-month
period during the period beginning on the Issue Date and ending on the second
anniversary of the Issue Date or, if later, the second anniversary of the last
date on which any Convertible Notes are issued upon exercise of the Initial
Purchasers' over-allotment option (each such event referred to in clauses (i)
and (ii) being referred to herein as a "Registration Default"), the Company will
pay liquidated damages ("Liquidated Damages") to each holder of Transfer
Restricted Securities which has complied with its obligations under the
Registration Agreement. The amount of Liquidated Damages payable during any
period in which a Registration Default shall have occurred and be continuing is
that amount which is equal to one-quarter of one percent (25 basis points) per
annum per $1,000 principal amount of Convertible Notes and $2.50 per annum per
42.2092 shares of Common Stock (subject to adjustment from time to time in the
event of a stock split, stock recombination, stock dividend and the like)
constituting Transfer Restricted Securities for the first 90 days during which a
Registration Default has occurred and is continuing and one-half of one percent
(50 basis points) per annum per $1,000 principal amount of Convertible Notes and
$5.00 per annum per 42.2092 shares of Common Stock (subject to adjustment as set
forth above) constituting Transfer Restricted Securities for any additional days
during which such Registration Default has occurred and is continuing. The
Company will pay all accrued Liquidated Damages by wire transfer of immediately
available funds or by federal funds check on each Damages Payment Date (as
defined in the Registration Agreement), and Liquidated Damages will be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
Following the cure of a Registration Default, Liquidated Damages will cease to
accrue with respect to such Registration Default.
"Transfer Restricted Securities" means each Convertible Note and each
share of Common Stock issued on conversion thereof until the date on which such
Convertible Note or share, as the case may be, (i) has been transferred pursuant
to the Shelf Registration Statement or another registration statement covering
such Convertible Note or share which has been filed with the Commission pursuant
to the Securities Act, in either case after such registration statement has
become and while such registration statement is effective under the Securities
Act, (ii) has been transferred pursuant to Rule 144 under the Securities Act (or
any similar provision then in force), or (iii) may be sold or transferred
pursuant to Rule 144(k) under the Securities Act (or any similar provision then
in force).
Pursuant to the Registration Agreement, the Company may suspend the use
of the prospectus which is a part of the Shelf Registration Statement for a
period not to exceed 45 days in any three-month period or for three periods not
to exceed an aggregate of 90 days in any twelve-month period under certain
circumstances (each, a "Suspension Period"); provided that the existence of a
Suspension Period will not prevent the occurrence of a Registration Default or
otherwise limit the obligation of the Company to pay Liquidated Damages.
The above description of certain provisions of the Registration
Agreement is qualified by reference to, and is subject in its entirety to, the
more complete description thereof contained in the Registration Agreement.
A-11
The Company will furnish to any holder upon written request and without
charge a copy of the Indenture and the Registration Agreement. Requests may be
made to: GATX Corporation, 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000-0000,
Attention: Treasurer.
A-12
FORM OF CONVERSION NOTICE
To: GATX CORPORATION
The undersigned beneficial owner of the Convertible Note hereby
irrevocably exercises the option to convert this Convertible Note, or portion
hereof (which is $1,000 or an integral multiple thereof) below designated, into
shares of Common Stock of GATX Corporation in accordance with the terms of the
Indenture referred to in this Convertible Note, and directs that the shares
issuable and deliverable upon the conversion, together with any check in payment
for fractional shares and Convertible Notes representing any unconverted
principal amount hereof, be issued and delivered to the beneficial owner hereof
unless a different name has been indicated below. If shares or any portion of
this Convertible Note not converted are to be issued in the name of a person
other than the undersigned, the undersigned will pay all transfer taxes payable
with respect thereto. Any amount required to be paid by the undersigned on
account of interest, Liquidated Damages and taxes accompanies this Convertible
Note.
Dated:
Fill in for registration of shares if to
be delivered, and Convertible Notes if ----------------------------------
to be issued, other than to and in the
name of the beneficial owner (Please ----------------------------------
Print):
----------------------------------
Signature(s)
---------------------------------- Principal amount to be converted
(Name) (if less than all);
---------------------------------- ----------------------------------
(Street Address) $___,000
---------------------------------- ----------------------------------
Social Security or other Taxpayer
Identification Number
--------------------------------
(City, State and Zip Code)
Signature Guarantee:
-----------------------------------------------
Signatures must be guaranteed by an eligible Guarantor Institution (banks,
brokers, dealers, savings and loan associations and credit unions) with
membership in an approved signature guarantee medallion program pursuant to
Securities and Exchange Commission Rule 17Ad-15 if shares are to be issued, or
Convertible Notes are to be delivered, other than to and in the name of the
registered holder(s).
A-13
ASSIGNMENT FORM
To assign this Convertible Note, fill in the form below:
(I) or (we) assign and transfer this Convertible Note to
--------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint ____________________________________ agent to transfer
this Convertible Note on the books of the Company. The agent may substitute
another to act for him.
Your Signature:
--------------------------------------------------------
(Sign exactly as your name appears on the other side of
this Convertible Note)
Date:
-------------------------------------------
Medallion Signature Guarantee:
-----------------------------------------
[FOR INCLUSION ONLY IF THIS CONVERTIBLE NOTE BEARS A RESTRICTED SECURITIES
LEGEND] In connection with any transfer of any of the Convertible Notes
evidenced by this certificate which are "restricted securities" (as defined in
Rule 144 (or any successor thereto) under the Securities Act), the undersigned
confirms that such Convertible Notes are being transferred:
CHECK ONE BOX BELOW
(1) [ ] to the Company; or
(2) [ ] pursuant to and in compliance with Rule 144A under
the Securities Act of 1933; or
(3) [ ] pursuant to and in compliance with Regulation S
under the Securities Act of 1933; or
(4) [ ] pursuant to an exemption from registration under the
Securities Act of 1933 provided by Rule 144
thereunder.
A-14
Unless one of the boxes is checked, the Registrar will refuse to register any of
the Convertible Notes evidenced by this certificate in the name of any person
other than the registered holder thereof; provided, however, that if box (3) or
(4) is checked, the Trustee may require, prior to registering any such transfer
of the Convertible Notes, such certifications and other information, and if box
(4) is checked such legal opinions, as the Company has reasonably requested in
writing, by delivery to the Trustee of a standing letter of instruction, to
confirm that such transfer is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act
of 1933; provided that this paragraph shall not be applicable to any Convertible
Notes which are not "restricted securities" (as defined in Rule 144 (or any
successor thereto) under the Securities Act).
Your Signature:
------------------------------------------------------------
(Sign exactly as your name appears on the
other side of this Convertible Note)
Date:
------------------------------------
Medallion Signature Guarantee:
------------------------------------
A-15
OPTION OF HOLDER TO ELECT REPURCHASE
If you wish to have this Convertible Note repurchased by the Company
pursuant to Article 5 of the Indenture, check the Box: [ ]
If you wish to have a portion of this Convertible Note purchased by the
Company pursuant to Section 5.2 of the Indenture, state the amount (in multiples
of $1,000): $ .
-----
Date: Your Signature:
------------ -----------------------------------------
(Sign exactly as your name appears on the other side of
this Convertible Note)
Medallion Signature Guarantee:
--------------------------------------------------
A-16
EXHIBIT B
FORM OF RESTRICTED COMMON STOCK LEGEND
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE SECOND ANNIVERSARY OF THE
ISSUANCE HEREOF (OR ANY PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT
WAS AN "AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF
THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH
TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO LONG AS THIS
SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (3) IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE
SECURITIES ACT) IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT, (4)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (5) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES
FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR
(2) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR
AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER)
REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT,
DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS
SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT."
B-1
EXHIBIT C
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
OF RESTRICTED COMMON STOCK
(Transfers pursuant to Section 14.11(c) of the Indenture)
[NAME AND ADDRESS OF COMMON STOCK TRANSFER AGENT]
Re: GATX Corporation 5% Convertible Notes
due 2023 (the "Convertible Notes")
Reference is hereby made to the Indenture dated as of August 15, 2003
(the "Indenture") by and among GATX Corporation, GATX Financial Corporation and
JPMorgan Chase Bank, as Trustee. Capitalized terms used but not defined herein
shall have the meanings given them in the Indenture.
This letter relates to _________ shares of Common Stock represented by
the accompanying certificate(s) that were issued upon conversion of Convertible
Notes and which are held in the name of [name of transferor] (the "Transferor")
to effect the transfer of such Common Stock.
In connection with the transfer of such shares of Common Stock, the
undersigned confirms that such shares of Common Stock are being transferred:
CHECK ONE BOX BELOW
(1) [ ] to the Company; or
(2) [ ] pursuant to and in compliance with Rule 144A under
the Securities Act of 1933; or
(3) [ ] pursuant to and in compliance with Regulation S
under the Securities Act of 1933; or
(4) [ ] pursuant to an exemption from registration under the
Securities Act of 1933 provided by Rule 144
thereunder.
C-1
Unless one of the boxes is checked, the transfer agent will refuse to
register any of the Common Stock evidenced by this certificate in the name of
any person other than the registered holder thereof; provided, however, that if
box (3) or (4) is checked, the transfer agent may require, prior to registering
any such transfer of the Common Stock such certifications and other information,
and if box (4) is checked such legal opinions, as the Company has reasonably
requested in writing, by delivery to the transfer agent of a standing letter of
instruction, to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933.
[Name of Transferor],
By
--------------------------------
Name:
------------------------------
Title:
-----------------------------
Dated:
C-2
