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EXHIBIT 4.1
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XXXXXXXXXX XXXXXXXXXXX, XXX.
XXX
XXXXXX XXXXXX TRUST COMPANY OF NEW YORK
as Trustee
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FIRST SUPPLEMENTAL INDENTURE
DATED AS OF APRIL 14, 1999
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Supplement to Indenture dated as of April 14, 1999
(Subordinated Debt Securities)
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FIRST SUPPLEMENTAL INDENTURE
FIRST SUPPLEMENTAL INDENTURE, dated as of April 14, 1999 by and between
MINDSPRING ENTERPRISES, INC., a Delaware corporation (hereinafter called the
"Company"), and UNITED STATES TRUST COMPANY OF NEW YORK, a bank and trust
company organized under the New York Banking Law (hereafter called the
"Trustee"), having a Corporate Trust Office at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx,
Xxx Xxxx, 00000, as Trustee under the Indenture (as hereinafter defined).
RECITALS
WHEREAS, the Company and the Trustee have as of April 14, 1999
entered into an Indenture, (hereinafter called the "Indenture;" all capitalized
terms used and not otherwise defined herein shall have the meanings set forth in
the Indenture) providing for the issuance by the Company from time to time of
its subordinated debt securities;
WHEREAS, no Securities have been issued under the Indenture and
there do not currently exist any Holders;
WHEREAS, THE Company desires to issue one series of convertible
subordinated debt securities under the Indenture, and has duly authorized the
creation and issuance of such debt securities and the execution and delivery of
this First Supplemental Indenture to modify the Indenture and provide certain
additional provisions as hereinafter described;
WHEREAS, the Company and the Trustee deem it advisable to enter
into this First Supplemental Indenture for the purposes of establishing the
terms of such debt securities and providing for the rights, obligations and
duties of the Trustee with respect to such debt securities;
WHEREAS, the execution and delivery of this First Supplemental
Indenture has been authorized by a resolution of the Board of Directors of the
Company;
WHEREAS, concurrent with the execution hereof, the Company has
delivered an Officers' Certificate and has caused its counsel to deliver to the
Trustee an Opinion of Counsel or a reliance letter upon an opinion of counsel;
and
WHEREAS, all conditions and requirements of the Indenture
necessary to make this First Supplemental Indenture a valid, binding and legal
instrument in accordance with its terms have been performed and fulfilled by
the parties hereto and the execution and delivery thereof have been in all
respects duly authorized by the parties hereto.
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the mutual premises and agreements
herein contained, the Company and the Trustee covenant and agree, for the equal
and proportionate benefit of all Holders of the Notes, as follows:
ARTICLE ONE
CREATION OF THE NOTES
SECTION 1.1. DESIGNATION OF SERIES. Pursuant to the terms hereof
and Sections 201 and 301 of the Indenture, the Company hereby creates a series
of its debt securities designated as the "5% Convertible Subordinated Notes
due 2006" (the "Notes"), which Notes shall be deemed "Securities" for all
purposes under the Indenture.
SECTION 1.2. FORM OF NOTES. The definitive form of the Notes shall
be substantially in the form set forth in Exhibit A attached hereto, which is
incorporated herein and
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made part hereof. The Notes shall bear interest, be payable and have such other
terms as are stated in the form of definitive Note or in the Indenture, as
supplemented by this First Supplemental Indenture. The Stated Maturity of the
Notes shall be April 15, 2006.
SECTION 1.3. LIMIT ON AMOUNT OF SERIES. The Notes shall not exceed
U.S.$179,975,000 in aggregate principal amount, and may, upon the execution and
delivery of this First Supplemental Indenture or from time to time thereafter,
be executed by the Company and delivered to the Trustee for authentication, and
the Trustee shall thereupon authenticate and deliver said Notes to or upon the
written order of the Company, signed by its Chief Executive Officer, President
or one of its Executive Vice Presidents and by its Chief Financial Officer or
Controller, without further action by the Company.
SECTION 1.4. CERTIFICATE OF AUTHENTICATION. The Trustee's
certificate of authentication to be borne on the Notes shall be substantially as
provided in the Form of Note attached hereto as Exhibit A.
SECTION 1.5. NO SINKING FUND. No sinking fund will be provided
with respect to the Notes.
ARTICLE TWO
CONVERSION OF NOTES
SECTION 2.1. APPLICABILITY OF CONVERSION PROVISIONS. Pursuant to
Section 301(24) of the Indenture, the Notes will be convertible in accordance
with the provisions of, and pursuant to, Article Sixteen of the Indenture.
SECTION 2.2. CONVERSION RATE. The rate at which shares of Common
Stock shall be delivered upon conversion (the "Conversion Rate") shall be
initially 8.00 shares of Common Stock for each $1,000 principal amount of
Notes. The Conversion Rate shall be adjusted in certain instances as provided in
Section 1605 of the Indenture.
ARTICLE THREE
APPOINTMENT OF THE TRUSTEE FOR THE NOTES
SECTION 3.1. APPOINTMENT OF TRUSTEE. Pursuant and subject to the
Indenture, the Company and the Trustee hereby constitute the Trustee as trustee
to act on behalf of the Holders of the Notes, and as the principal Paying Agent
and Security Registrar for the Notes, effective upon execution and delivery of
this First Supplemental Indenture. By execution, acknowledgment and delivery of
this First Supplemental Indenture, the Trustee hereby accepts appointment as
trustee, Paying Agent, Conversion Agent and Security Registrar with respect to
the Notes, and agrees to perform such trusts upon the terms and conditions in
the Indenture and in this First Supplemental Indenture set forth.
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SECTION 3.2. RIGHTS, POWERS, DUTIES AND OBLIGATIONS OF THE
TRUSTEE. Any rights, powers, duties and obligations by any provisions of the
Indenture conferred or imposed upon the Trustee shall, insofar as permitted by
law, be conferred or imposed upon and exercised or performed by the Trustee with
respect to the Notes.
ARTICLE FOUR
DEFEASANCE
SECTION 4.1. DEFEASANCE APPLICABLE TO NOTES. Pursuant to Section
301(19) and Section 1301 of the Indenture, the Company will have the option of
defeasance of the Notes under Section 1302 of the Indenture upon the terms and
conditions contained in Article Thirteen of the Indenture; provided, however,
that the Company shall not have the option of covenant defeasance, as described
in Section 1303 of the Indenture, with respect to the Notes.
ARTICLE FIVE
EVENTS OF DEFAULT
SECTION 5.1. ADDITIONAL EVENT OF DEFAULT. Pursuant to Section
301(25) of the Indenture, so long as any of the Notes are Outstanding, the
following events shall be an Event of Default with respect to the Notes, in
addition to the Events of Default contained in Section 501 of the Indenture:
"(1) Failure by the Company to give a Company Notice in accordance
with Article Eight of the First Supplemental Indenture, whether or not such
payment is prohibited by the subordination provisions of the Notes, the
Indenture or the First Supplemental Indenture or (2) default in the performance,
or breach, of any other provision described in the First Supplemental Indenture,
and continuance of such default or breach for a period of 60 days after there
has been given, by registered or certified mail to the Company, by the Trustee
or to the Company, and the Trustee by the Holders of at least 25% in principal
amount of the Outstanding Notes under the First Supplemental Indenture a written
notice specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" under the Indenture."
SECTION 5.2. NOTICE OF DEFAULT OR EVENT OF DEFAULT. The Company
shall deliver to the Trustee, as soon as possible and in any event within 10
days after an officer of Company becomes aware of the occurrence of any Event of
Default or any event which, with notice or the lapse of time or both, would
constitute an Event of Default, an Officers' Certificate setting forth the
details of such Event of Default or Default and the action which the Company
proposes to take with respect thereto.
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ARTICLE SIX
REDEMPTION OF NOTES
Pursuant to Section 301(7) and Section 1101 of the Indenture, so long as
any of the Notes are Outstanding, the following provisions shall be applicable
to the Notes:
SECTION 6.1. RIGHT OF REDEMPTION.
(a) Provisional Redemption by the Company. The Notes may be
redeemed by the Company (a "Provisional Redemption"), in whole or in part, at
any time prior to April 15, 2002, upon notice as set forth in Section 1104 of
the Indenture, at a redemption price equal to $1,000 per $1,000 principal amount
of Notes to be redeemed plus accrued and unpaid interest, if any, to the date of
redemption (the "Provisional Redemption Date") if (i) the closing price of the
Common Stock shall have exceeded 150% of the Conversion Price then in effect for
at least 20 Trading Days in any consecutive 30-Trading Day period ending on the
Trading Day prior to the date of mailing of the notice of redemption pursuant to
Section 3.2 (the "Notice Date"). Upon any such Provisional Redemption, the
Company shall make an additional payment in cash (the "Make-Whole Payment") with
respect to the Notes called for redemption to holders on the Notice Date in an
amount equal to $200 per $1,000 Note, less the amount of any interest
actually paid on such Note prior to the Notice Date. The Company shall make the
Make-Whole Payment on all Notes called for Provisional Redemption, including any
Notes converted into Common Stock pursuant to the terms hereof after the Notice
Date and prior to the Provisional Redemption Date. For purposes of this Article,
any Note and Article Eight, the "Conversion Price" shall equal U.S.$1,000
divided by the Conversion Rate (rounded to the nearest cent).
(b) Optional Redemption by the Company. At any time on or after
April 15, 2002, and prior to maturity, the Notes may be redeemed at the
option of the Company (an "Optional Redemption"), in whole or in part, upon
notice as set forth in Section 1104 of the Indenture, at the following
Redemption Prices (expressed as a percentage of principal amount) for the
12-month periods beginning on April 15 of the following years:
REDEMPTION
YEAR PRICE
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2002 102.86%
2003 102.14%
2004 101.43%
2005 100.71%
and 100% of the principal amount on April 15, 2006, in each case together with
accrued interest to the Redemption Date.
SECTION 6.2. APPLICABILITY OF ARTICLE. Redemption of the Notes at
the election of the Company or otherwise, as permitted or required by any
provision of the Notes or this First
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Supplemental Indenture, shall be made in accordance with such provision, Article
Eleven of the Indenture and this Article Six.
SECTION 6.3. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION. In
connection with any redemption of the Notes, the Company may arrange for the
purchase and conversion of any Notes by an agreement with one or more investment
bankers or other purchasers (the "Purchasers") to purchase such Notes by paying
to the Trustee in trust for the Holders, on or before the Redemption Date, an
amount not less than the applicable Redemption Price, together with interest
accrued and unpaid to the Redemption Date, of such Notes. Notwithstanding
anything to the contrary contained in this Article Six or Article Eleven of the
Indenture, the obligation of the Company to pay the Redemption Price, together
with interest accrued and unpaid to the Redemption Date, shall be deemed to be
satisfied and discharged to the extent such amount is so paid by such
Purchasers. If such an agreement is entered into (a copy of which shall be filed
with the Trustee prior to the close of business on the Business Day immediately
prior to the Redemption Date), any Notes called for redemption that are not duly
surrendered for conversion by the Holders thereof may, at the option of the
Company, be deemed, to the fullest extent permitted by law, and consistent with
any agreement or agreements with such Purchasers, to be acquired by such
Purchasers from such Holders and (notwithstanding anything to the contrary
contained in this Article Six or Article Eleven of the Indenture) surrendered by
such Purchasers for conversion, all as of immediately prior to the close of
business on the Redemption Date (and the right to convert any such Notes shall
be extended through such time), subject to payment of the above amount as
aforesaid. At the direction of the Company, the Trustee shall hold and dispose
of any such amount paid to it by the Purchasers to the Holders in the same
manner as it would monies deposited with it by the Company for the redemption of
Notes. Without the Trustee's prior written consent, no arrangement between the
Company and such Purchasers for the purchase and conversion of any Notes shall
increase or otherwise affect any of the powers, duties, responsibilities or
obligations of the Trustee as set forth in this Indenture, and the Company
agrees to indemnify the Trustee from, and hold it harmless against, any loss,
liability or expense arising out of or in connection with any such arrangement
for the purchase and conversion of any Notes between the Company and such
Purchasers, including the costs and expenses, including reasonable legal fees,
incurred by the Trustee in the defense of any claim or liability arising out of
or in connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
ARTICLE SEVEN
SUBORDINATION OF NOTES
Pursuant to Section 301(23) of the Indenture, and in addition to
the other provisions contained in Article Fifteen of the Indenture (which shall
be applicable to the Notes in all respects), so long as any of the Notes are
Outstanding, the following provisions shall be applicable to the Notes:
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SECTION 7.1. NO PAYMENT IN CERTAIN CIRCUMSTANCES, PAYMENT OVER OF
PROCEEDS UPON DISSOLUTION, ETC. No payment shall be made with respect to the
principal of, or premium, if any, or interest on the Notes (including, but not
limited to, the Redemption Price with respect to the Notes to be called for
redemption in accordance with Article Eleven of the Indenture and Article Six
hereof or the Repurchase Price with respect to Notes submitted for repurchase in
accordance with Article Eight), except payments and distributions made by the
Trustee as permitted by Section 1511 of the Indenture, if:
(i) a default in the payment of principal, premium, if any, or
interest (including a default under any repurchase or redemption obligation) or
other amounts with respect to any Senior Debt occurs and is continuing (or, in
the case of Senior Debt for which there is a period of grace, in the event of
such a default that continues beyond the period of grace, if any, specified in
the instrument, agreement or lease evidencing such Senior Debt) unless and until
such default shall have been cured or waived or shall have ceased to exist; or
(ii) a default, other than a payment default, on any Designated
Senior Debt occurs and is continuing that then permits holders of such
Designated Senior Debt to accelerate its maturity and the Trustee receives a
notice of the default (a "Payment Blockage Notice") from a holder of such
Designated Senior Debt or the Company.
If the Trustee receives any Payment Blockage Notice pursuant to clause (ii)
above, no subsequent Payment Blockage Notice shall be effective for purposes of
this Section unless and until (A) at least 365 days shall have elapsed since the
initial effectiveness of the immediately prior Payment Blockage Notice, and (B)
all scheduled payments of principal, premium, if any, and interest on the Notes
that have come due have been paid in full in cash. No nonpayment default that
existed or was continuing on the date of delivery of any Payment Blockage Notice
to the Trustee shall be, or be made, the basis for a subsequent Payment Blockage
Notice.
The Company may and shall resume payments on and distributions in respect
of the Notes upon the earlier of:
(1) the date upon which the default described in (i) or (ii) above is
cured or waived or ceases to exist, or
(2) in the case of a default referred to in clause (ii) above, 179
days pass after notice is received if the maturity of such Designated Senior
Debt has not been accelerated, unless this Article Seven otherwise prohibits the
payment or distribution at the time of such payment or distribution.
SECTION 7.2. PRIOR PAYMENT OF SENIOR DEBT UPON ACCELERATION OF
SECURITIES. In the event of the acceleration of the Notes because of an Event of
Default, no payment or distribution shall be made to the Trustee or any holder
of Notes in respect of the principal of, premium, if any, or interest on the
Notes (including, but not limited to, the Redemption Price with respect to the
Notes called for redemption in accordance with Article 11
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of the Indenture or Article Six hereof or the Repurchase Price with respect to
the Securities submitted for repurchase in accordance with Article Eight
hereof), except payments and distributions made by the Trustee as permitted by
Section 7.3, until all Senior Debt has been paid in full in cash or other
payment satisfactory to the holders of Senior Debt or such acceleration is
rescinded in accordance with the terms of this Indenture.
SECTION 7.3. PAYMENT PERMITTED IF NO DEFAULT. Nothing contained in
this Article, Article Fifteen of the Indenture or elsewhere in this First
Supplemental Indenture, the Indenture or in any of the Notes shall prevent (a)
the Company, at any time except during the pendency of any case, proceeding,
dissolution or liquidation or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding referred to in Section 1502 of the Indenture
or as provided in Section 7.1 or Section 7.2 hereof, from making payments at any
time of principal of (and premium, if any) or interest on the Notes, or (b) the
application by the Trustee of any money deposited with it hereunder to the
payment of or on account of the principal of (and premium, if any) or interest
on the Notes or the retention of such payment by the Holders, if, at the time of
such application by the Trustee, it did not have knowledge that such payment
would have been prohibited by the provisions of this Article or Article Fifteen
of the Indenture.
SECTION 7.4. TRUSTEE TO EFFECTUATE SUBORDINATION. Each Holder of a
Note by its acceptance thereof authorizes and directs the Trustee on its behalf
to take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article and Article Fifteen of the Indenture and
appoints the Trustee its attorney-in-fact for any and all such purposes.
SECTION 7.5. RELIANCE BY HOLDERS OF SENIOR DEBT ON SUBORDINATION
PROVISIONS. Each Holder by accepting a Note acknowledges and agrees that the
foregoing subordination provisions are, and are intended to be, an inducement
and a consideration to each holder of any Senior Debt, whether such Senior Debt
was created or acquired before or after the issuance of the Notes, to acquire
and continue to hold, or to continue to hold, such Senior Debt and such holder
of Senior Debt shall be deemed conclusively to have relied on such subordination
provisions in acquiring and continuing to hold, or in continuing to hold, such
Senior Debt, and no amendment or modification of the provisions contained herein
shall diminish the rights of such holders of Senior Debt unless such holders
shall have agreed in writing thereto.
SECTION 7.6. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT;
PRESERVATION OF TRUSTEE'S RIGHTS. The Trustee in its individual capacity shall
be entitled to all the rights set forth in this Article with respect to any
Senior Debt which may at any time be held by it, to the same extent as any other
holder of Senior Debt, and nothing in this Indenture shall deprive the Trustee
of any of its rights as such holder. Nothing in this Article shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 606 of the
Indenture.
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SECTION 7.7. ARTICLE APPLICABLE TO PAYING AGENTS. In case at any
time any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term "Trustee" as used in this Article
shall in such case (unless the context otherwise requires) be construed as
extending to and including such Paying Agent within its meaning as fully for all
intents and purposes as if such Paying Agent were named in this Article in
addition to or in place of the Trustee; provided, however, that Section 7.6
shall not apply to the Company or any Affiliate of the Company if it or such
Affiliate acts as Paying Agent.
SECTION 7.8. DETERMINATION OF CERTAIN CONVERSIONS AND REPURCHASES
AS PAYMENTS. For the purposes of this Article and Article Fifteen of the
Indenture only, (a) the issuance and delivery of junior securities upon (i)
conversion of Notes in accordance with Article Sixteen of the Indenture or (ii)
the repurchase of Notes in accordance with Article Eight, shall not be deemed to
constitute a payment or distribution on account of the principal of, or premium
or interest on, Notes or on account of the purchase or other acquisition of the
Notes, and (b) the payment, issuance or delivery of cash (except in satisfaction
of fractional shares pursuant to Section 1604 of the Indenture), property or
securities (other than junior securities) upon conversion of a Note shall be
deemed to constitute payment on account of the principal of such Note. For the
purposes of this Section, the term "junior securities" means (a) shares of any
stock of any class of the Company and securities into which the Notes are
convertible pursuant to Article Sixteen of the Indenture or the terms of the
Notes and (b) securities of the Company which are subordinated in right of
payment to all Senior Debt which may be outstanding at the time of issuance or
delivery of such securities to substantially the same extent as, or to a greater
extent than, the Notes are so subordinated as provided in this Article or
Article Fifteen of the Indenture. Nothing contained in this Article, Article
Fifteen of the Indenture or elsewhere in the First Supplemental Indenture, the
Indenture or in the Notes is intended to or shall impair, as among the Company,
its creditors other than holders of Senior Debt and the Holders of the Notes,
the right, which is absolute and unconditional, of the Holder of any Note to
convert such Note in accordance with Article Sixteen of the Indenture or to
exchange such Note for Common Stock in accordance with Article Eight hereof if
the Company elects to satisfy the obligations under Article Eight by the
delivery of Common Stock.
SECTION 7.9. DEFINITION. For purposes of this Article Seven, the
term "Designated Senior Debt" means the Company's obligations under that certain
Credit Agreement dated as of February 17, 1999, as now in effect and as the same
may be amended from time to time, by and among the Company as Borrower, the
Lenders who are or may become a party thereto, First Union Capital Markets
Corp., as Arranger, and First Union National Bank, as Administrative Agent for
the Lenders (such capitalized terms being understood to have the meanings
ascribed thereto in the Credit Agreement), and any particular Senior Debt in
which the instrument creating or evidencing the same or the assumption or
guarantee thereof (or related agreements or documents to which the Company is a
party) expressly provides that such indebtedness shall be "Designated Senior
Debt" for purposes of the Indenture (provided that such instrument, agreement or
other document may place limitations and conditions on the right of such Senior
Debt to exercise the rights of Designated Senior Debt), in each case, including
any
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amendments, replacements, supplements or other modifications thereto, or any
refinancings or extensions thereof, in whole or in part.
ARTICLE EIGHT
REPURCHASE OF NOTES AT THE OPTION OF THE HOLDER
UPON A CHANGE IN CONTROL
Pursuant to Section 301(7) of the Indenture and in substitution of
the terms of Article Twelve of the Indenture, so long as any of the Notes are
Outstanding, the following provisions shall be applicable to the Notes:
SECTION 8.1. RIGHT TO REQUIRE REPURCHASE. In the event that a
Change in Control (as hereinafter defined) shall occur, then each Holder shall
have the right, at the Holder's option, but subject to the provisions of Section
8.2., to require the Company to repurchase, and upon the exercise of such right
the Company shall repurchase, all of such Holder's Notes not theretofore called
for redemption, or any portion of the principal amount thereof that is equal to
U.S. $5,000 or any integral multiple of U.S. $1,000 in excess thereof (provided
that no single Note may be repurchased in part unless the portion of the
principal amount of such Note to be Outstanding after such repurchase is equal
to U.S. $1,000 or integral multiples of U.S. $1,000 in excess thereof), on the
date (the "Repurchase Date") that is 45 days after the date of the Company
Notice (as defined in Section 8.3) at a purchase price equal to 100% of the
principal amount of the Notes to be repurchased plus interest accrued to the
Repurchase Date (the "Repurchase Price"); provided, however, that installments
of interest on Notes whose Stated Maturity is on or prior to the Repurchase Date
shall be payable to the Holders of such Notes, or one or more Predecessor
Securities, registered as such on the relevant Record Date according to their
terms and the provisions of Section 307 of the Indenture. Such right to require
the repurchase of the Notes shall not continue after a discharge or defeasance
of the Company from its obligations with respect to the Notes in accordance with
the provision of Article Thirteen of the Indenture applicable to the Notes
pursuant to Article Four hereof, unless a Change in Control shall have occurred
prior to such discharge or defeasance. At the option of the Company, the
Repurchase Price may be paid in cash or, subject to the fulfillment by the
Company of the conditions set forth Section 8.2, by delivery of shares of Common
Stock having a fair market value equal to the Repurchase Price. Whenever in this
First Supplemental Indenture, Exhibit A hereto or the Indenture (including
Article One hereof and Sections 201, 501(1) and 508 of the Indenture) there is a
reference, in any context, to the principal of any Note as of any time, such
reference shall be deemed to include reference to the Repurchase Price payable
in respect of such Note to the extent that such Repurchase Price is, was or
would be so payable at such time, and express mention of the Repurchase Price in
any provision of this Indenture shall not be construed as excluding the
Repurchase Price in those provisions of this Indenture when such express mention
is not made; provided, however, that for the purposes of Article Seven such
reference shall be deemed to include reference to the Repurchase Price only to
the extent the Repurchase Price is payable in cash.
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SECTION 8.2. CONDITIONS TO THE COMPANY'S ELECTION TO PAY THE
REPURCHASE PRICE IN COMMON STOCK. The Company may elect to pay the Repurchase
Price by delivery of shares of Common Stock pursuant to Section 8.1 if:
(1) The shares of Common Stock deliverable in payment of the
Repurchase Price shall have a fair market value as of the Repurchase Date of not
less than the Repurchase Price. For purposes of Section 8.1 and this Section
8.2, the fair market value of shares of Common Stock shall be determined by the
Company and shall be equal to 95% of the average of the Closing Prices Per Share
of the Common Stock for the five consecutive Trading Days immediately preceding
and including the third Trading Day prior to the Repurchase Date;
(2) The shares of Common Stock to be issued upon repurchase of Notes
hereunder (i) shall not require registration under any federal securities law
before such shares may be freely transferable without being subject to any
transfer restrictions under the Securities Act upon repurchase or, if such
registration is required, such registration shall be completed and shall become
effective prior to the Repurchase Date, and (ii) shall not require registration
with or approval of any governmental authority under any state law or any other
federal law before such shares may be validly issued or delivered upon
repurchase or if such registration is required or such approval must be
obtained, such registration shall be completed or such approval shall be
obtained prior to the Repurchase Date;
(3) The shares of Common Stock to be issued upon repurchase of Notes
hereunder are, or shall have been, approved for listing on the Nasdaq National
Market or the New York Stock Exchange or listed on another national securities
exchange, in any case, prior to the Repurchase Date; and
(4) All shares of Common Stock which may be issued upon repurchase of
Notes will be issued out of the Company's authorized but unissued Common Stock
and, will upon issue, be duly and validly issued and fully paid and
non-assessable and free of any preemptive or similar rights.
If all of the conditions set forth in this Section 8.2 are not satisfied
in accordance with the terms thereof, the Repurchase Price shall be paid by the
Company only in cash.
SECTION 8.3. NOTICES; METHOD OF EXERCISING REPURCHASE RIGHT, ETC.
(1) Unless the Company shall have theretofore called for
redemption all of the Outstanding Notes, on or before the 30th day after the
occurrence of a Change in Control, the Company or, at the request and expense of
the Company on or before the 30th day after such occurrence, the Trustee, shall
give to all Holders of Notes, in the manner provided in Section 106 of the
Indenture, notice (the "Company Notice") of the occurrence of the Change of
Control and of the repurchase right set forth herein arising as a result
thereof. The Company shall also
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deliver a copy of such notice of a repurchase right to the Trustee. Each notice
of a repurchase right shall state:
(i) the Repurchase Date,
(ii) the date by which the repurchase right must be exercised,
(iii) the Repurchase Price, and whether the Repurchase Price
shall be paid by the Company in cash or by delivery of shares of Common Stock,
(iv) a description of the procedure which a Holder must follow
to exercise a repurchase right, and the place or places where such Notes, are to
be surrendered for payment of the Repurchase Price and accrued interest, if any,
(v) that on the Repurchase Date the Repurchase Price, and
accrued and unpaid interest, if any, will become due and payable upon each such
Note designated by the Holder to be repurchased, and that interest thereon shall
cease to accrue on and after said date,
(vi) the Conversion Rate then in effect, the date on which the
right to convert the principal amount of the Notes to be repurchased will
terminate and the place or places where such Notes may be surrendered for
conversion, and
(vii) the place or places that the Note certificate with the
Election of Holder to Require Repurchase as specified in Exhibit A hereto shall
be delivered.
No failure of the Company to give the foregoing notices or defect therein
shall limit any Holder's right to exercise a repurchase right or affect the
validity of the proceedings for the repurchase of Notes.
If any of the foregoing provisions or other provisions of this Article
Eight are inconsistent with applicable law, such law shall govern.
(2) To exercise a repurchase right, a Holder shall deliver to the
Trustee on or before the 30th day after the date of the Company Notice (i)
written notice of the Holder's exercise of such right, which notice shall set
forth the name of the Holder, the principal amount of the Notes to be
repurchased (and, if any Note is to repurchased in part, the serial number
thereof, the portion of the principal amount thereof to be repurchased and the
name of the Person in which the portion thereof to remain Outstanding after such
repurchase is to be registered) and a statement that an election to exercise the
repurchase right is being made thereby, and, in the event that the Repurchase
Price shall be paid in shares of Common Stock, the name or names (with
addresses) in which the certificate or certificates for shares of Common Stock
shall be issued, and (ii) the Notes with respect to which the repurchase right
is being exercised. Such written notice shall be irrevocable, except that the
right of the Holder to convert the Notes with respect to which the repurchase
right is being exercised shall continue until the close of business on the
Business Day immediately preceding the Repurchase Date.
- 11 -
13
(3) In the event a repurchase right shall be exercised in accordance
with the terms hereof, the Company shall pay or cause to be paid to the Trustee
the Repurchase Price in cash or shares of Common Stock, as provided above, for
payment to the Holder on the Repurchase Date or, if shares of Common Stock are
to be paid, as promptly after the Repurchase Date as practicable, together with
accrued and unpaid interest to the Repurchase Date payable with respect to the
Notes as to which the repurchase right has been exercised; provided, however,
that installments of interest that mature on or prior to the Repurchase Date
shall be payable in cash to the Holders of such Notes, or one or more
Predecessor Securities, registered as such at the close of business on the
relevant Regular Record Date.
(4) If any Note (or portion thereof) surrendered for repurchase shall
not be so paid on the Repurchase Date, the principal amount of such Note (or
portion thereof, as the case may be) shall, until paid, bear interest to the
extent permitted by applicable law from the Repurchase Date at the rate of 5%
per annum, and each Note shall remain convertible into Common Stock until the
principal of such Note (or portion thereof, as the case may be) shall have been
paid or duly provided for.
(5) Any Note which is to be repurchased only in part shall be
surrendered to the Trustee (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and make available for delivery to the Holder of such Note
without service charge, a new Note or Notes, containing identical terms and
conditions, each in an authorized denomination in aggregate principal amount
equal to and in exchange for the unrepurchased portion of the principal of the
Note so surrendered.
(6) Any issuance of shares of Common Stock in respect of the
Repurchase Price shall be deemed to have been effected immediately prior to the
close of business on the Repurchase Date and the Person or Persons in whose name
or names any certificate or certificates for shares of Common Stock shall be
issuable upon such repurchase shall be deemed to have become on the Repurchase
Date the holder or holders of record of the shares represented thereby;
provided, however, that any surrender for repurchase on a date when the stock
transfer books of the Company shall be closed shall constitute the Person or
Persons in whose name or names the certificate or certificates for such shares
are to be issued as the record holder or holders thereof for all purposes at the
opening of business on the next succeeding day on which such stock transfer
books are open. No payment or adjustment shall be made for dividends or
distributions on any Common Stock issued upon repurchase of any Note declared
prior to the Repurchase Date.
(7) No fractions of shares shall be issued upon repurchase of Notes.
If more than one Note shall be repurchased from the same Holder and the
Repurchase Price shall be payable in shares of Common Stock, the number of full
shares which shall be issuable upon such repurchase shall be computed on the
basis of the aggregate principal amount of the Notes so repurchased. Instead of
any fractional share of Common Stock which would otherwise be issuable on the
- 12 -
14
repurchase of any Note or Notes, the Company will deliver to the applicable
Holder its check for the current market value of such fractional share. The
current market value of a fraction of a share is determined by multiplying the
current market price of a full share by the fraction, and rounding the result to
the nearest cent. For purposes of this Section, the current market price of a
share of Common Stock is the Closing Price Per Share of the Common Stock on the
Trading Day immediately preceding the Repurchase Date.
(8) Any issuance and delivery of certificates for shares of Common
Stock on repurchase of Notes shall be made without charge to the Holder of Notes
being repurchased for such certificates or for any tax or duty in respect of the
issuance or delivery of such certificates or the Notes represented thereby;
provided, however, that the Company shall not be required to pay any tax or duty
which may be payable in respect of (i) income of the Holder or (ii) any transfer
involved in the issuance or delivery of certificates for shares of Common Stock
in a name other than that of the Holder of the Notes being repurchased, and no
such issuance or delivery shall be made unless and until the Person requesting
such issuance or delivery has paid to the Company the amount of any such tax or
duty or has established, to the satisfaction of the Company, that such tax or
duty has been paid.
(9) All Notes delivered for repurchase shall be delivered to the
Trustee to be canceled at the direction of the Trustee, which shall dispose of
the same as provided in Section 309 of the Indenture.
SECTION 8.4. CERTAIN DEFINITIONS. For purposes of this Article
Eight,
(1) the term "beneficial owner" shall be determined in accordance with
Rule 13d-3, as in effect on the date of the original execution of this
Indenture, promulgated by the Commission pursuant to the Exchange Act;
(2) a "Change in Control" shall be deemed to have occurred at the
time, after the original issuance of the Notes, of:
(i) the acquisition by any Person (including any syndicate or
group deemed to be a "person" under Section 13(d)(3) of the Exchange Act) of
beneficial ownership, directly or indirectly, through a purchase, merger or
other acquisition transaction or series of transactions, of shares of capital
stock of the Company entitling such person to exercise 50% or more of the total
voting power of all shares of capital stock of the Company entitled to vote
generally in the elections of directors (or persons holding a similar function),
other than any such acquisition by the Company, any subsidiary of the Company or
any employee benefit plan of the Company; or
(ii) any consolidation of the Company with, or merger of the
Company into, any other Person, any merger of another Person into the Company,
or any conveyance, sale, transfer or lease of all or substantially all of the
assets of the Company to another Person (other than (a) any such transaction (x)
which does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of capital stock of the Company and (y)
pursuant
- 13 -
15
to which the holders of the Common Stock immediately prior to such transaction
have the entitlement to exercise, directly or indirectly, 50% or more of the
total voting power of all shares of capital stock entitled to vote generally in
the election of directors (or persons holding a similar function) of the
continuing or surviving corporation immediately after such transaction and (b)
any merger which is effected solely to change the jurisdiction of incorporation
of the Company and results in a reclassification, conversion or exchange of
outstanding shares of Common Stock into solely shares of common stock of the
surviving entity);
provided, however, that a Change in Control shall not be deemed to have occurred
if the Closing Sales Price Per Share of the Common Stock for any five Trading
Days within the period of 10 consecutive Trading Days ending immediately after
the later of the Change in Control or the public announcement of the Change in
Control (in the case of a Change in Control under clause (i) above) or the
period of 10 consecutive Trading Days ending immediately before the Change in
Control (in the case of a Change in Control under clause (ii) above) shall equal
or exceed 105% of the Conversion Price of the Notes in effect on each such
Trading Day; and
(3) the term "Closing Price Per Share" means, with respect to the
Common Stock, for any day, (i) the last reported sale price regular way on the
Nasdaq National Market or, (ii) if the Common Stock is not listed on the Nasdaq
National Market, the last reported sale price regular way per share or, in case
no such reported sale takes place on such day, the average of the reported
closing bid and asked prices regular way, in either case, on the principal
national securities exchange on which the Common Stock is listed or admitted to
trading, or (iii) if the Common Stock is not quoted on the Nasdaq National
Market or listed or admitted to trading on any national securities exchange, the
average of the closing bid prices in the over-the-counter market as furnished by
any Nasdaq National Market member firm selected from time to time by the Company
for that purpose.
SECTION 8.5. CONSOLIDATION, MERGER, ETC. In the case of any
consolidation, conveyance, sale, transfer or lease of all or substantially all
of the assets of the Company to which Section 1612 of the Indenture applies, in
which the Common Stock of the Company is changed or exchanged as a result into
the right to receive shares of stock and other securities or property or assets
(including cash) which includes shares of Common Stock of the Company or common
stock of another Person that are, or upon issuance will be, traded on a United
States national securities exchange or approved for trading on an established
automated over-the-counter trading market in the United States and such shares
constitute at the time such change or exchange becomes effective in excess of
50% of the aggregate fair market value of such shares of stock and other
securities, property and assets (including cash) (as determined by the Company,
which determination shall be conclusive and binding), then the Person formed by
such consolidation or resulting from such merger or combination or which
acquires the properties or assets (including cash) of the Company, as the case
may be, shall execute and deliver to the Trustee a supplemental indenture (which
shall comply with the Trust Indenture Act as in force at the date of execution
of such supplemental indenture) modifying the provisions of this Indenture
relating to the right of Holders to cause the Company to repurchase the Notes
following a Change in Control, including without limitation the applicable
provisions of this Article Eight
- 14 -
16
and the definitions of the Common Stock and Change in Control, as appropriate,
and such other related definitions set forth herein and in the Indenture as
determined in good faith by the Company (which determination shall be conclusive
and binding), to make such provisions apply in the event of a subsequent Change
of Control to the 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).
ARTICLE NINE
MISCELLANEOUS
SECTION 9.1. APPLICATION OF FIRST SUPPLEMENTAL INDENTURE. Each and
every term and condition contained in the First Supplemental Indenture that
modifies, amends or supplements the terms and conditions of the Indenture shall
apply only to the Notes created hereby and not to any future series of Notes
established under the Indenture.
SECTION 9.2. BENEFITS OF FIRST SUPPLEMENTAL INDENTURE. Nothing
contained in this First Supplemental Indenture shall or shall be construed to
confer upon any person other than a Holder of the Notes, the Company and the
Trustee any right or interest to avail itself or himself, as the case may be, of
any benefit under any provision of the Indenture or this First Supplemental
Indenture, except for Holders of Senior Debt as provided in Article Seven
hereof.
SECTION 9.3. DEFINED TERMS. All capitalized terms which are used
herein and not otherwise defined herein are defined in the Indenture and are
used herein with the same meanings as Indenture.
SECTION 9.4. EFFECTIVE DATE. This First Supplemental Indenture
shall be effective as of the date first above written and upon the execution and
delivery hereof by each of the parties hereto.
SECTION 9.5. GOVERNING LAW. This First Supplemental Indenture
shall be governed by, and construed in accordance with, the laws of the State of
New York.
SECTION 9.6. COUNTERPARTS. This First Supplemental Indenture may
be executed in any number of counterparts, each of which so executed shall be
deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument.
SECTION 9.7. SATISFACTION AND DISCHARGE. This Supplemental
Indenture shall cease to be of further force and effect upon compliance with
such provisions of Article Thirteen of the Indenture as may be applicable to the
Notes pursuant to Article Four hereof with respect to the Notes created hereby.
- 15 -
17
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed by their respective officers hereunto
duly authorized, all as of the day and year first above written.
MINDSPRING ENTERPRISES, INC.
Dated: _______________ By:
--------------------------
Name:
Title:
By:
--------------------------
Name:
Title:
Attest:
UNITED STATES TRUST COMPANY OF NEW YORK
-------------------------- as Trustee
Name:
Title:
Dated: __________________ By:
--------------------------
Name:
Title:
Attest:
--------------------------
Name:
Title:
- 16 -
18
ACKNOWLEDGMENT
STATE OF
) ss:
COUNTY OF
On the ___ day of _____________, 1999, before me personally came
____________________________________________, to me known, who, being by me duly
sworn, did depose and say that he is the _________________________________ of
MINDSPRING ENTERPRISES, INC., one of the parties described in and which executed
the foregoing instrument, and that [s]he signed [her][his] name thereto by
authority of the Board of Directors.
[Notarial Seal]
------------------------------
Notary Public
Commission Expires
- 17 -
19
ACKNOWLEDGMENT
STATE OF
) ss:
COUNTY OF
On the ___ day of _____________, 1999, before me personally came
____________________________________________, to me known, who, being by me duly
sworn, did depose and say that he is the _________________________________ of
MINDSPRING ENTERPRISES, INC., one of the parties described in and which executed
the foregoing instrument, and that [s]he signed [her][his] name thereto by
authority of the Board of Directors.
[Notarial Seal]
------------------------------
Notary Public
Commission Expires
- 18 -
20
ACKNOWLEDGMENT
STATE OF
) ss:
COUNTY OF
On the ___ day of _____________, 1999, before me personally came
____________________________________________, to me known, who, being by me duly
sworn, did depose and say that he is the _________________________________ of
UNITED STATES TRUST COMPANY OF NEW YORK, one of the parties described in and
which executed the foregoing instrument, and that [s]he signed [her][his] name
thereto by authority of the Board of Directors.
[Notarial Seal]
------------------------------
Notary Public
Commission Expires
- 19 -
21
EXHIBIT A TO FIRST SUPPLEMENTAL INDENTURE
FORM OF NOTE
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH GLOBAL SECURITY:
THIS 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 NOTE FOR ALL PURPOSES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY 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 AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR 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 OR BY THE DEPOSITARY OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY.]
A-1
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MINDSPRING ENTERPRISES, INC.
5% CONVERTIBLE SUBORDINATED NOTE
DUE 2006
No. ________________ U.S.$_________________
CUSIP NO. 602683 AA2
MINDSPRING ENTERPRISES, INC., a corporation duly organized and existing
under the laws of the State of Delaware (herein called the "Company", which term
includes any successor Person under the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay to _____________________,
the principal sum of ________ United States Dollars (U.S.$______ ) (which
principal amount may from time to time be increased or decreased to such other
principal amounts (which, taken together with the principal amounts of all
other Outstanding Notes under this Series of Notes, shall not exceed
U.S.$179,975,000 in the aggregate at any time) by adjustments made on the
records of the Trustee hereinafter referred to in accordance with the
Indenture) on April 15, 2006 and to pay interest thereon, from April 14, 1999,
or from the most recent Interest Payment Date (as defined below) to which
interest has been paid or duly provided for, semi-annually in arrears on April
15 and October 15 in each year (each, an "Interest Payment Date"), commencing
October 15, 1999, at the rate of 5% per annum, until the principal hereof is
due, and at the rate of 5% per annum on any overdue principal and premium, if
any, and, to the extent permitted by law, on any overdue interest. The interest
so payable, and punctually paid or duly provided for, on any Interest Payment
Date will, as provided in the Indenture, be paid to the Person in whose name
this Note (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be the April
1 or October 1 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. Except as otherwise provided in the
Indenture, any such interest not so punctually paid or duly provided for will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Note (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Company, notice whereof shall be given to Holders of Notes not less than 10
days prior to the Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any automated quotation
system or securities exchange on which the Notes may be quoted or listed, and
upon such notice as may be required by such exchange, all as more fully
provided in the Indenture. Payments of principal shall be made upon the
surrender of this Note at the Corporate Trust Office of the Trustee, or at such
other office or agency of the Company as may be designated by the Company for
such purpose in the Borough of Manhattan, The City of New York, in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for the payment of public and private debts, by United States
Dollar check drawn on, or transfer to, a United States Dollar account. Payments
of interest on this Note may be made by United States Dollar check, drawn on a
United States Dollar Account, mailed to the address of the Person
A-2
23
entitled thereto as such address shall appear in the Security Register, or, upon
written application by the Holder to the Security Registrar setting forth wire
instructions not later than the relevant Record Date, by transfer to a United
States Dollar account; provided however, that transfers to United States Dollar
accounts will be made only to Holders of an aggregate principal amount of Notes
in excess of $2,000,000.
Except as specifically provided herein and in the Indenture, the Company
shall not be required to make any payment with respect to any tax, assessment or
other governmental charge imposed by any government or any political subdivision
or taxing authority thereof or therein.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof or an Authenticating Agent by the
manual signature of one of their respective authorized signatories, this Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
A-3
24
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed
and delivered under its corporate seal.
MINDSPRING ENTERPRISES, INC.
[Corporate Seal]
By:
---------------------------
Name:
Title:
Attest:
By:
----------------------------- ---------------------------
Name: Name:
Title: Title:
(Trustee's Certificate of Authentication)
This is one of the 5% Convertible Subordinated Notes due 2006 referred
to in the within-mentioned Indenture.
UNITED STATES TRUST COMPANY OF NEW
YORK, as Trustee
By:
---------------------------
Authorized Signatory
A-4
25
[FORM OF REVERSE]
This Note is one of a duly authorized issue of securities of the Company
designated as its "5% Convertible Subordinated Notes due 2006" (herein called
the "Notes"), limited in aggregate principal amount to U.S. $179,975,000, issued
and to be issued under an Indenture, dated as of April 14, 1999 (herein called
the "Base Indenture"), between the Company and United States Trust Company Of
New York, as Trustee (herein called the "Trustee", which term includes any
successor trustee under the Base Indenture), and a First Supplemental Indenture,
dated as of April 14, 1999 between the Company and the Trustee (the "First
Supplemental Indenture"; the Base Indenture, as supplemented by the First
Supplemental Indenture, the "Indenture") to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Company,
the Trustee, the holders of Senior Debt and the Holders of the Notes and of the
terms upon which the Notes are, and are to be, authenticated and delivered. As
provided in the Indenture and subject to certain limitations therein set forth,
Notes are exchangeable for a like aggregate principal amount of Notes of any
authorized denominations as requested by the Holder surrendering the same upon
surrender of the Note or Notes to be exchanged, at the Corporate Trust Office of
the Trustee. The Trustee upon such surrender by the Holder will issue the new
Notes in the requested denominations.
No sinking fund is provided for the Notes.
The Notes are subject to Provisional Redemption by the Company, in whole
or in part, at any time prior to April 15, 2002, upon notice as set forth in
Section 1104 of the Indenture, at a redemption price equal to $1,000 per Note to
be redeemed plus accrued and unpaid interest, if any, to the Provisional
Redemption Date if (i) the closing price of the Common Stock shall have exceeded
150% of the Conversion Price then in effect for at least 20 Trading Days in any
consecutive 30-Trading Day period ending on the Trading Day prior to the Notice
Date. Upon any such Provisional Redemption, the Company shall make a Make-Whole
Payment with respect to the Notes called for redemption to holders on the Notice
Date in an amount equal to $200 per $1,000 Note, less the amount of any
interest actually paid on such Note prior to the Notice Date. The Company shall
make the Make-Whole Payment on all Notes called for Provisional Redemption,
including any Notes converted into Common Stock pursuant to the terms of the
Indenture after the Notice Date and prior to the Provisional Redemption Date.
The Notes are also subject to redemption at the option of the Company at
any time on or after April 15, 2002, in whole or in part, upon not less than
30 nor more than 60 days' notice to the Holders prior to the Redemption Date at
the following Redemption Prices (expressed as percentages of the principal
amount) for the twelve-month period beginning on April 15 of the following
years:
YEAR REDEMPTION PRICE
---- ----------------
2002 102.86%
2003 102.14%
2004 101.43%
2005 100.71%
A-5
26
and on April 15, 2006 at a Redemption Price equal to 100% of the principal
amount, together, in each case, with accrued and unpaid interest to the
Redemption Date; provided, however, that interest installments on Notes whose
Stated Maturity is on or prior to such Redemption Date will be payable to the
Holders of such Notes, or one or more Predecessor Securities, of record at the
close of business on the relevant Record Dates referred to on the face hereof,
all as provided in the Indenture.
In the event of a redemption of the Notes, the Company will not be
required (a) to register the transfer or exchange of Notes for a period of 15
days immediately preceding the date notice is given identifying the serial
numbers of the Notes called for such redemption or (b) to register the transfer
or exchange of any Note, or portion thereof, called for redemption.
In any case where the due date for the payment of the principal of,
premium, if any, or interest on any Note or the last day on which a Holder of a
Note has a right to convert his Note shall be, at any Place of Payment or Place
of Conversion as the case may be, a day on which banking institutions at such
Place of Payment or Place of Conversion are authorized or obligated by law or
executive order to close, then payment of principal, premium, if any, interest
or delivery for conversion of such Note need not be made on or by such date at
such place but may be made on or by the next succeeding day at such place which
is not a day on which banking institutions are authorized or obligated by law or
executive order to close, with the same force and effect as if made on the date
for such payment or the date fixed for redemption or repurchase, or by such last
day for conversion, and no interest shall accrue on the amount so payable for
the period after such date.
Subject to and upon compliance with the provisions of the Indenture, the
Holder of this Note is entitled, at his option, at any time following the
original issue date of the Notes and on or before the close of business on the
Business Day immediately preceding April 15, 2006, or in case this Note or a
portion hereof is called for redemption or the Holder hereof has exercised his
right to require the Company to repurchase this Note or such portion hereof,
then in respect of this Note until but (unless the Company defaults in making
the payment due upon redemption or repurchase, as the case may be) not after,
the close of business on Business Day immediately preceding the Redemption Date
or the Repurchase Date, as the case may be, to convert this Note (or any portion
of the principal amount hereof that is an integral multiple of U.S.$1,000,
provided that the unconverted portion of such principal amount is U.S.$1,000 or
any integral multiple of U.S.$1,000 in excess thereof) into fully paid and
nonassessable shares of Common Stock of the Company at an initial Conversion
Rate of 8.00 shares of Common Stock for each $1,000 principal amount of Notes
(or at the current adjusted Conversion Rate if an adjustment has been made as
provided in the Indenture, including pursuant to Section 1605(2) of the
Indenture) by surrender of this Note, duly endorsed or assigned to the Company
or in blank and, in case such surrender shall be made during the period from the
close of business on any Regular Record Date next preceding any Interest Payment
Date to the opening of business on such Interest Payment Date (except if this
Note or portion thereof has been called for redemption
A-6
27
on a Redemption Date or is repurchasable on a Repurchase Date and the
conversion rights of this Note, or such portion thereof, would terminate during
the period between such Regular Record Date and the close of business on such
Interest Payment Date), also accompanied by payment in New York Clearing House
or other funds acceptable to the Company of an amount equal to the interest
payable on such Interest Payment Date on the principal amount of this Note then
being converted, and also the conversion notice hereon duly executed, to the
Company at the Corporate Trust Office of the Trustee, or at such other office
or agency of the Company, subject to any laws or regulations applicable thereto
and subject to the right of the Company to terminate the appointment of any
Conversion Agent (as defined below) as may be designated by it for such purpose
in the Borough of Manhattan, The City of New York, or at such other offices or
agencies as the Company may designate (each a "Conversion Agent"), provided,
however, that if this Note or portion hereof has been called for redemption on
a Redemption Date or is repurchasable on a Repurchase Date and the conversion
rights of this Note, or such portion thereof, would terminate during the period
between such Regular Record Date and the close of business on such Interest
Payment Date, then the Holder of this Note on such Regular Record Date will be
entitled to receive the interest accruing hereon from the Interest Payment Date
next preceding the date of such conversion to such succeeding Interest Payment
Date and the Holder of this Note who converts this Note or a portion hereof
during such period shall not be required to pay such interest upon surrender of
this Note for conversion. Subject to the provisions of the preceding sentence
and, in the case of a conversion after the close of business on the Regular
Record Date next preceding any Interest Payment Date and on or before the close
of business on such Interest Payment Date, to the right of the Holder of this
Note (or any Predecessor Security of record as of such Regular Record Date) to
receive the related installment of interest to the extent and under the
circumstances provided in the Indenture, no cash payment or adjustment is to be
made on conversion for interest accrued hereon from the Interest Payment Date
next preceding the day of conversion, or for dividends on the Common Stock
issued on conversion hereof. The Company shall thereafter deliver to the Holder
the fixed number of shares of Common Stock (together with any cash adjustment,
as provided in the Indenture) into which this Note is convertible and such
delivery will be deemed to satisfy the Company's obligation to pay the
principal amount of this Note. No fractions of shares or scrip representing
fractions of shares will be issued on conversion, but instead of any fractional
interest (calculated to the nearest 1/100th of a share) the Company shall pay a
cash adjustment as provided in the Indenture. The Conversion Rate is subject to
adjustment as provided in the Indenture. In addition, the Indenture provides
that in case of certain consolidations or mergers to which the Company is a
party (other than a consolidation or merger that does not result in any
reclassification, conversion, exchange or cancellation of the Common Stock) or
the conveyance, transfer, sale or lease of all or substantially all of the
property and assets of the Company, the Indenture shall be amended, without the
consent of any Holders of Notes, so that this Note, if then Outstanding, will
be convertible thereafter, during the period this Note shall be convertible as
specified above, only into the kind and amount of securities, cash and other
property receivable upon such consolidation, merger, conveyance, transfer, sale
or lease by a holder of the number of shares of Common Stock of the Company
into which this Note could have been converted immediately prior to such
consolidation, merger, conveyance, transfer, sale or lease (assuming such
holder of Common Stock is not a Constituent Person or an Affiliate of a
Constituent Person, failed to exercise any rights of election and received per
share the kind and amount received per share by
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28
a plurality of Non-electing Shares and further assuming, if such consolidation,
merger, conveyance, transfer, sale or lease occurs prior to the original issue
date of the Notes, that the Note was convertible at the time of such occurrence
at the Conversion Rate specified above as adjusted from the issue date of such
Note to such time as provided in the Indenture). No adjustment in the Conversion
Rate will be made until such adjustment would require an increase or decrease of
at least one percent of such price, provided that any adjustment that would
otherwise be made will be carried forward and taken into account in the
computation of any subsequent adjustment.
If a Change in Control occurs, the Holder of this Note, at the Holder's
option, shall have the right, in accordance with the provisions of the
Indenture, to require the Company to repurchase this Note (or any portion of the
principal amount hereof that is at least $5,000 or an integral multiple of
$1,000 in excess thereof, provided that the portion of the principal amount of
this Note to be Outstanding after such repurchase is at least equal to
U.S.$1,000) for cash at a Repurchase Price equal to 100% of the principal amount
thereof plus interest accrued to the Repurchase Date. At the option of the
Company, the Repurchase Price may be paid in cash or, subject to the conditions
provided in the Indenture, by delivery of shares of Common Stock having a fair
market value equal to the Repurchase Price. For purposes of this paragraph, the
fair market value of shares of Common Stock shall be determined by the Company
and shall be equal to 95% of the average of the Closing Prices Per Share for the
five consecutive Trading Days immediately preceding and including the third
Trading Day prior to the Repurchase Date. Whenever in this Note there is a
reference, in any context, to the principal of any Note as of any time, such
reference shall be deemed to include reference to the Repurchase Price payable
in respect of such Note to the extent that such Repurchase Price is, was or
would be so payable at such time, and express mention of the Repurchase Price in
any provision of this Note shall not be construed as excluding the Repurchase
Price so payable in those provisions of this Note when such express mention is
not made; provided, however, that, for the purposes of the second succeeding
paragraph, such reference shall be deemed to include reference to the Repurchase
Price only to the extent the Repurchase Price is payable in cash.
[The following paragraph shall appear in each Global Security:
In the event of a deposit or withdrawal of an interest in this Note,
including an exchange, transfer, redemption, repurchase or conversion of this
Note in part only, the Trustee, as custodian of the Depositary, shall make an
adjustment on its records to reflect such deposit or withdrawal in accordance
with the rules and procedures of The Depository Trust Company applicable to, and
as in effect at the time of, such transaction.]
[The following paragraph shall appear in each Note that is not a Global
Security:
In the event of redemption, repurchase or conversion of this Note in part
only, a new Note or Notes for the unredeemed, unrepurchased or unconverted
portion hereof will be issued in the name of the Holder hereof.]
The indebtedness evidenced by this Note is, to the extent and in the
manner provided in the Indenture, subordinate and subject in right of payment to
the prior payment in full in cash of
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29
all Senior Debt of the Company, and this Note is issued subject to such
provisions of the Indenture with respect thereto. Each Holder of this Note, by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his behalf to take such action as may be
necessary or appropriate to effectuate the subordination so provided and (c)
appoints the Trustee his attorney-in-fact for any and all such purposes.
If an Event of Default shall occur and be continuing, the principal of
all the Notes, together with accrued interest to the date of declaration, may be
declared due and payable in the manner and with the effect provided in the
Indenture. Upon payment (i) of the amount of principal so declared due and
payable, together with accrued interest to the date of declaration, and (ii) of
interest on any overdue principal and, to the extent permitted by applicable
law, overdue interest, all of the Company's obligations in respect of the
payment of the principal of and interest on the Notes shall terminate.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes under the Indenture at any
time by the Company and the Trustee with either (a) the written consent of the
Holders of not less than a majority in principal amount of the Notes at the time
Outstanding, or (b) by the adoption of a resolution, at a meeting of Holders of
the Outstanding Notes at which a quorum is present, by the Holders of at least
66-2/3% in aggregate principal amount of the Outstanding Notes represented and
entitled to vote at such meeting. The Indenture also contains provisions
permitting the Holders of specified percentages in principal amount of the Notes
at the time Outstanding, on behalf of the Holders of all the Notes, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Note shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued in
exchange herefor or in lieu hereof whether or not notation of such consent or
waiver is made upon this Note or such other Note.
As provided in and subject to the provisions of the Indenture, the Holder
of this Note shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default, the Holders of not less
than 25% in principal amount of the Outstanding Notes shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity and the Trustee
shall not have received from the Holders of a majority in principal amount of
the Outstanding Notes a direction inconsistent with such request, and shall have
failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. The foregoing shall not apply to any
suit instituted by the Holder of this Note for the enforcement of any payment of
principal hereof, premiums if any, or interest hereon on or after the respective
due dates expressed herein or for the enforcement of the right to convert this
Note as provided in the Indenture.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay
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30
the principal of, premium, if any, and interest on this Note at the times,
places and rate, and in the coin or currency, herein prescribed or to convert
this Note as provided in the Indenture.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note is registrable on the Security Register
upon surrender of this Note for registration of transfer at the Corporate Trust
Office of the Trustee or at such other office or agency of the Company as may be
designated by it for such purpose in the Borough of Manhattan, The City of New
York (which shall initially be an office or agency of the Trustee), or at such
other offices or agencies as the Company may designate, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder thereof or his
attorney duly authorized in writing, and thereupon one or more new Notes, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees by the Registrar. No service
charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to recover any tax or other
governmental charge payable in connection therewith.
Prior to due presentation of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name Note is registered, as the owner thereof for all purposes,
whether or not such Note be overdue, and neither the Company, the Trustee nor
any such agent shall be affected by notice to the contrary.
No recourse for the payment of the principal (and premium, if any) or
interest on this Note and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture or any indenture supplemental thereto
or in any Note, or because of the creation of any indebtedness represented
thereby, shall be had against any incorporator, stockholder, employee, agent,
officer or director or subsidiary, as such, past, present or future, of the
Company or of any successor corporation, either directly or through the Company
or any successor corporation, whether by virtue of any constitution, statute or
rule of law or by the enforcement of any assessment or penalty or otherwise, all
such liability being, by the acceptance hereof and as part of consideration for
the issue hereof, expressly waived and released.
THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA.
All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
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31
ABBREVIATIONS
The following abbreviations, when used in the inscription of the face of
this Note, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties (Cust)
JT TEN - as joint tenants with right of survivorship and
not as tenants in common
UNIF GIFT MIN ACT - _________________ Custodian _____________
(Minor)
under Uniform Gifts to Minors Act_______________
(State)
Additional abbreviations may also be used though not in the above list.
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ELECTION OF HOLDER TO REQUIRE REPURCHASE
(1) Pursuant to Article Eight of the First Supplemental Indenture, the
undersigned hereby elects to have this Note repurchased by the Company.
(2) The undersigned hereby directs the Trustee or the Company to pay
to the undersigned an amount in cash or, at the Company's election, Common Stock
valued as set forth in the Indenture, equal to 100% of the principal amount to
be repurchased (as set forth below), plus interest accrued to the Repurchase
Date, as provided in the Indenture.
Dated:
------------------------------
------------------------------------
------------------------------------
Signature(s)
Signature(s) must be guaranteed by an
Eligible Guarantor Institution with
membership in an approved signature
guarantee program pursuant to Rule
17Ad-15 under the Securities Exchange
Act of 1934.
------------------------------------
Signature Guaranteed
Principal amount to be repurchased (at least U.S. $5,000 or an integral multiple
$1,000 in excess thereof): _______________________________
Remaining principal amount following such repurchase
(not less than U.S. $1,000): _________________________________
NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Note in every particular, without alteration or
any change whatsoever.
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33
CONVERSION NOTICE
The undersigned Holder of this Note hereby irrevocably exercises the
option to convert this Note, or any portion of the principal amount hereof
(which is U.S.$1,000 or an integral multiple of U.S.$1,000 in excess thereof,
PROVIDED that the unconverted portion of such principal amount is U.S. $1,000 or
any integral multiple of U.S. $1,000 in excess thereof) below designated, into
shares of Common Stock in accordance with the terms of the Indenture referred to
in this Note, and directs that such shares, together with a check in payment for
any fractional share and any Notes representing any unconverted principal amount
hereof, be delivered to and be registered in the name of the undersigned unless
a different name has been indicated below. If shares of Common Stock or Notes
are to be registered in the name of a Person other than the undersigned, (a) the
undersigned will pay all transfer taxes payable with respect thereto and (b)
signature(s) must be guaranteed by an Eligible Guarantor Institution with
membership in an approved signature guarantee program pursuant to Rule 17Ad-15
under the Securities Exchange Act of 1934. Any amount required to be paid by the
undersigned on account of interest accompanies this Note.
Dated:______________________________
--------------------------------
--------------------------------
Signature(s)
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34
If shares or Notes are to be registered in the name of a Person other than the
Holder, please print such Person's name and address:
-------------------------------
Name
-------------------------------
Address
-------------------------------
Social Security or other Identification
Number, if any
-------------------------------
Signature Guaranteed
If only a portion of the Notes is to be converted, please indicate:
1. Principal amount to be converted:
U.S. $
-----------
2. Principal amount and denomination of Notes representing unconverted
principal amount to be issued:
Amount U.S. $
-----------
(U.S.$1,000 or any integral multiple of U.S.$1,000 in excess thereof,
provided that the unconverted portion of such principal amount is U.S.
$1,000 or any integral multiple of U.S. $1,000 in excess thereof)
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35
FORM OF ASSIGNMENT
For value received ________________ hereby sell(s), assign(s) and
transfer(s) unto ________________ (Please insert social security or other
identifying number of assignee) the within Note, and hereby irrevocably
constitutes and appoints ____________________ as attorney to transfer the said
Note on the books of the Company, with full power of substitution in the
premises.
Dated:
--------------------------- ------------------------------
--------------------------- ------------------------------
Signature(s)
Signature(s) must be guaranteed by an Eligible
Guarantor Institution with membership in an
approved signature guarantee program pursuant to
Rule 17Ad-15 under the Securities Exchange Act
of 1934.
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