EXHIBIT 4.6
---------------------------------
DIGITAL ISLAND, INC.
ISSUER
TO
STATE STREET BANK AND TRUST COMPANY,
TRUSTEE
---------------------------------
INDENTURE
Dated as of __________, 2000
________________
Up to U.S.$__________
___% CONVERTIBLE SUBORDINATED NOTES DUE __________, 2005
---------------------------------
Certain Sections of this Indenture relating to
Section 310 through 318 of the Trust Indenture Act
Trust Indenture Indenture
Act Section Section
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(S) 310(a)(1) .......................... 6.8
(a)(2) .......................... 6.8
(a)(3) .......................... Not Applicable
(a)(4) .......................... Not Applicable
(b) .......................... 6.13
6.9
(S) 311(a) .......................... 6.14
(b) .......................... 6.14
(S) 312(a) 14.1
.......................... 14.2(a)
(b) .......................... 14.2(b)
(c) .......................... 14.2(c)
(S) 313(a) .......................... 14.4(a)
(b) .......................... 14.4(b)
(c) .......................... 14.4(a)
(d) .......................... 14.4(b)
(S) 314(a) .......................... 14.5
(b) .......................... Not Applicable
(c)(1) .......................... 1.2
(c)(2) .......................... 1.2
(c)(3) .......................... Not Applicable
(d) .......................... Not Applicable
(e) .......................... 1.2
(S) 315(a) .......................... 6.1
(b) .......................... 6.2
(c) .......................... 6.1
(d) .......................... 6.1
(e) .......................... 5.14
(S) 316(a)(1)(A) .......................... 5.12
(a)(1)(B) .......................... 5.13
(a)(2) .......................... Not Applicable
(b) .......................... 5.8
(c) .......................... 1.4
(S) 317(a)(1) .......................... 5.3
(a)(2) .......................... 5.4
(b) .......................... 9.3
(S) 318(a) .......................... 1.7
TABLE OF CONTENTS
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Page
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RECITALS OF THE COMPANY............................................... 1
ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL
APPLICATION
SECTION 1.1. Definitions............................................. 2
Act.............................................................. 2
Affiliate........................................................ 2
Agent Member..................................................... 3
Applicable Procedures............................................ 3
Authenticating Agent............................................. 3
Authorized Newspaper............................................. 3
Board of Directors............................................... 3
Board Resolution................................................. 3
Business Day..................................................... 3
Change in Control................................................ 4
Closing Price Per Share.......................................... 4
Code............................................................. 4
Commission....................................................... 4
Common Stock..................................................... 4
Company.......................................................... 5
Company Notice................................................... 5
Company Request" or "Company Order............................... 5
Constituent Person............................................... 5
Conversion Agent................................................. 5
Conversion Price................................................. 5
Conversion Rate.................................................. 5
Corporate Trust Office........................................... 5
Defaulted Interest............................................... 6
Depositary....................................................... 6
Designated Senior Debt........................................... 6
Dollar........................................................... 6
U.S.$............................................................ 6
DTC.............................................................. 6
Note: This table of contents shall not, for any purpose, be deemed
to be a part of the Indenture.
-i-
Event of Default................................................. 6
Exchange Act..................................................... 6
Global Security.................................................. 6
Holder........................................................... 6
Indenture........................................................ 6
Interest Payment Date............................................ 7
Maturity......................................................... 7
Non-electing Share............................................... 7
Notice of Default................................................ 7
Officers' Certificate............................................ 7
Opinion of Counsel............................................... 7
Outstanding...................................................... 7
Paying Agent..................................................... 9
Person........................................................... 9
Place of Conversion.............................................. 9
Place of Payment................................................. 9
Predecessor Security............................................. 9
Record Date...................................................... 9
Record Date Period............................................... 9
Redemption Date.................................................. 9
Redemption Price................................................. 10
Regular Record Date.............................................. 10
Repurchase Date.................................................. 10
Repurchase Price................................................. 10
Responsible Officer.............................................. 10
Securities....................................................... 10
Securities Act................................................... 10
Security Register" and "Security Registrar....................... 10
Senior Debt...................................................... 10
Special Record Date.............................................. 12
Stated Maturity.................................................. 12
Subsidiary....................................................... 12
Successor Security............................................... 12
Trading Days..................................................... 12
Trust Indenture Act.............................................. 13
Trustee.......................................................... 13
United States.................................................... 13
Vice President................................................... 13
SECTION 1.2. Compliance Certificates and Opinions.................... 13
Note: This table of contents shall not, for any purpose, be deemed
to be a part of the Indenture.
-ii-
SECTION 1.3. Form of Documents Delivered to the
Trustee................................................. 14
SECTION 1.4. Acts of Holders of Securities........................... 15
SECTION 1.5. Notices, Etc., to Trustee and Company................... 18
SECTION 1.6. Notice to Holders of Securities; Waiver................. 19
SECTION 1.7. Effect of Headings and Table of Contents................ 20
SECTION 1.8. Successors and Assigns.................................. 20
SECTION 1.9. Separability Clause..................................... 20
SECTION 1.10. Benefits of Indenture................................... 20
SECTION 1.11. Governing Law........................................... 20
SECTION 1.12. Legal Holidays.......................................... 20
SECTION 1.13. Conflict with Trust Indenture Act....................... 21
ARTICLE TWO SECURITY FORMS
SECTION 2.1. Form Generally.......................................... 22
SECTION 2.2. Form of Security........................................ 23
SECTION 2.3. Form of Certificate of Authentication................... 39
SECTION 2.4. Form of Conversion Notice............................... 39
SECTION 2.5. Form of Assignment...................................... 40
ARTICLE THREE THE SECURITIES
SECTION 3.1. Title and Terms......................................... 41
SECTION 3.2. Denominations........................................... 42
SECTION 3.3. Execution, Authentication, Delivery
and Dating.............................................. 42
SECTION 3.4. Global Securities; Non-Global Securities................ 43
SECTION 3.5. Registration, Registration of Transfer and
Exchange; Restrictions on Transfer...................... 46
SECTION 3.6. Mutilated, Destroyed, Lost or Stolen
Securities.............................................. 47
SECTION 3.7. Payment of Interest; Interest Rights
Preserved............................................... 49
SECTION 3.8. Persons Deemed Owners................................... 50
SECTION 3.9. Cancellation............................................ 51
SECTION 3.10. Computation of Interest................................. 51
SECTION 3.11. CUSIP Numbers........................................... 51
Note: This table of contents shall not, for any purpose, be deemed
to be a part of the Indenture.
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ARTICLE FOUR SATISFACTION AND DISCHARGE
SECTION 4.1. Satisfaction and Discharge of Indenture................ 51
SECTION 4.2. Application of Trust Money............................. 53
ARTICLE FIVE REMEDIES
SECTION 5.1. Events of Default...................................... 54
SECTION 5.2. Acceleration of Maturity; Rescission and
Annulment.............................................. 56
SECTION 5.3. Collection of Indebtedness and Suits for
Enforcement by Trustee................................. 57
SECTION 5.4. Trustee May File Proofs of Claim....................... 58
SECTION 5.5. Trustee May Enforce Claims Without Possession
of Securities.......................................... 59
SECTION 5.6. Application of Money Collected......................... 60
SECTION 5.7. Limitation on Suits.................................... 60
SECTION 5.8. Unconditional Right of Holders to Receive
SECTION 5.9. Restoration of Rights and Remedies..................... 61
SECTION 5.10. Rights and Remedies Cumulative......................... 62
SECTION 5.11. Delay or Omission Not Waiver........................... 62
SECTION 5.12. Control by Holders of Securities....................... 62
SECTION 5.13. Waiver of Past Defaults................................ 63
SECTION 5.14. Undertaking for Costs.................................. 63
SECTION 5.15. Waiver of Stay, Usury or Extension Laws................ 64
ARTICLE SIX THE TRUSTEE
SECTION 6.1. Certain Duties and Responsibilities.................... 64
SECTION 6.2. Notice of Defaults..................................... 66
SECTION 6.3. Certain Rights of Trustee.............................. 66
SECTION 6.4. Not Responsible for Recitals or Issuance of
Securities............................................. 68
SECTION 6.5. May Hold Securities, Act as Trustee Under
Other Indentures....................................... 68
SECTION 6.6. Money Held in Trust.................................... 68
SECTION 6.7. Compensation and Reimbursement......................... 68
SECTION 6.8. Corporate Trustee Required; Eligibility................ 70
SECTION 6.9. Resignation and Removal; Appointment
SECTION 6.10. Acceptance of Appointment by Successor................. 72
Note: This table of contents shall not, for any purpose, be deemed
to be a part of the Indenture.
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SECTION 6.11. Merger, Conversion, Consolidation or
Succession to Business................................. 72
SECTION 6.12. Authenticating Agents.................................. 73
SECTION 6.13. Disqualification; Conflicting Interests................ 75
SECTION 6.14. Preferential Collection of Claims Against
Company................................................ 75
ARTICLE SEVEN CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR
LEASE
SECTION 7.1. Company May Consolidate, Etc., Only on Certain Terms... 75
SECTION 7.2. Successor Substituted.................................. 76
ARTICLE EIGHT SUPPLEMENTAL INDENTURES
SECTION 8.1. Supplemental Indentures Without Consent of
SECTION 8.2. Supplemental Indentures with Consent of
Holders of Securities.................................. 78
SECTION 8.3. Execution of Supplemental Indentures................... 79
SECTION 8.4. Effect of Supplemental Indentures...................... 80
SECTION 8.5. Reference in Securities to Supplemental
Indentures............................................. 80
SECTION 8.6. Notice of Supplemental Indentures...................... 80
SECTION 8.7. Conformity with Trust Indenture Act.................... 81
ARTICLE NINE COVENANTS
SECTION 9.1 Payment of Principal, Premium and Interest............. 81
SECTION 9.2. Maintenance of Offices or Agencies..................... 81
SECTION 9.3. Money for Security Payments To Be
SECTION 9.4. Existence.............................................. 84
SECTION 9.5. Maintenance of Properties.............................. 84
SECTION 9.6. Payment of Taxes and Other Claims...................... 84
SECTION 9.7. Statement by Officers as to Default.................... 85
SECTION 9.8. Waiver of Certain Covenants............................ 85
ARTICLE TEN REDEMPTION OF SECURITIES
SECTION 10.1. Right of Redemption.................................... 86
Note: This table of contents shall not, for any purpose, be deemed
to be a part of the Indenture.
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SECTION 10.2. Applicability of Article............................... 86
SECTION 10.3. Election to Redeem; Notice to Trustee.................. 86
SECTION 10.4. Selection by Trustee of Securities To Be
Redeemed............................................... 87
SECTION 10.5. Notice of Redemption................................... 87
SECTION 10.6. Deposit of Redemption Price............................ 88
SECTION 10.7. Securities Payable on Redemption Date.................. 89
SECTION 10.8. Securities Redeemed in Part............................ 89
SECTION 10.9. Conversion Arrangement on Call for Redemption.......... 90
ARTICLE ELEVEN CONVERSION OF SECURITIES
SECTION 11.1. Conversion Privilege and Conversion Rate............... 91
SECTION 11.2. Exercise of Conversion Privilege....................... 92
SECTION 11.3. Fractions of Shares.................................... 94
SECTION 11.4. Adjustment of Conversion Rate.......................... 94
SECTION 11.5. Notice of Adjustments of Conversion Rate............... 101
SECTION 11.6. Notice of Certain Corporate Action..................... 101
SECTION 11.7. Company to Reserve Common Stock........................ 103
SECTION 11.8. Taxes on Conversions................................... 103
SECTION 11.9. Covenant as to Common Stock............................ 103
SECTION 11.10. Cancellation of Converted Securities................... 103
SECTION 11.11. Provision in Case of Consolidation, Merger or
Sale of Assets......................................... 104
SECTION 11.12. Responsibility of Trustee for Conversion
Provisions............................................. 105
ARTICLE TWELVE SUBORDINATION OF SECURITIES
SECTION 12.1. Securities Subordinate to Senior Debt.................. 106
SECTION 12.2. No Payments in Certain Circumstances; Payment
Over of Proceeds Upon Dissolution, Etc................. 106
SECTION 12.3. Trustee to Effectuate Subordination.................... 109
SECTION 12.4. No Waiver of Subordination Provisions.................. 109
SECTION 12.5. Notice to Trustee...................................... 110
SECTION 12.6. Reliance on Judicial Order or Certificate of
Liquidating Agent...................................... 111
SECTION 12.7. Trustee Not Fiduciary for Holders of Senior
Debt................................................... 111
Note: This table of contents shall not, for any purpose, be deemed
to be a part of the Indenture.
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SECTION 12.8. Reliance by Holders of Senior Debt on
Subordination Provisions............................... 112
SECTION 12.9. Rights of Trustee as Holder of Senior Debt;
Preservation of Trustee's Rights....................... 112
SECTION 12.10. Article Applicable to Paying Agents.................... 112
SECTION 12.11. Certain Conversions and Repurchases Deemed
Payment................................................ 113
ARTICLE THIRTEEN REPURCHASE OF SECURITIES AT THE OPTION OF
THE HOLDER UPON A CHANGE IN CONTROL
SECTION 13.1. Right to Require Repurchase............................ 113
SECTION 13.2. Conditions to the Company's Election to Pay
the Repurchase Price in Common Stock................... 114
SECTION 13.3. Notices; Method of Exercising Repurchase
Right, Etc............................................. 115
SECTION 13.4. Certain Definitions.................................... 119
ARTICLE FOURTEEN HOLDERS LISTS AND REPORTS BY TRUSTEE AND
COMPANY; NON-RECOURSE
SECTION 14.1. Company to Furnish Trustee Names and
Addresses of Holders................................... 121
SECTION 14.2. Preservation of Information............................ 121
SECTION 14.3. No Recourse Against Others............................. 122
SECTION 14.4. Reports by Trustee..................................... 122
SECTION 14.5. Reports by Company..................................... 123
Note: This table of contents shall not, for any purpose, be deemed
to be a part of the Indenture.
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INDENTURE, dated as of ____________, 2000, between Digital Island,
Inc., a corporation duly organized and existing under the laws of the State of
Delaware, having its principal office at 00 Xxxxxxx Xxxxxx, Xxxxx 0000, Xxx
Xxxxxxxxx, Xxxxxxxxxx 00000 (herein called the "Company"), and State Street Bank
and Trust Company, a ________________, as Trustee hereunder (herein called the
"Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its __%
Convertible Subordinated Notes due ____________, 2005 (herein called the
"Securities") of substantially the tenor and amount hereinafter set forth, and
to provide therefor the Company has duly authorized the execution and delivery
of this Indenture.
All things necessary to make the Securities, when the Securities are
executed by the Company and authenticated and delivered hereunder, the valid
obligations of the Company, and to make this Indenture a valid agreement of the
Company, in accordance with their and its terms, have been done. Further, all
things necessary to duly authorize the issuance of the Common Stock of the
Company issuable upon the conversion of the Securities, and to duly reserve for
issuance the number of shares of Common Stock issuable upon such conversion,
have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and pro portionate benefit of all Holders of the Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1. Definitions.
-----------
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein that are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with respect
to any computation required or permitted hereunder shall mean such
accounting principles as are generally accepted at the date of such
computation; and
(4) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder of a Security, has the
meaning specified in Section 1.4.
------- ---
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or con trolled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person,
-2-
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"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.
"Authenticating Agent" means any Person authorized pursuant to
Section 6.12 to act on behalf of the Trustee to authenticate Securities.
------------
"Authorized Newspaper" means a newspaper in the English language,
customarily published on each Monday, Tuesday, Wednesday, Thursday and Friday,
whether or not published on Saturdays, Sundays or holidays, and of general
circulation in a Place of Payment.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
"Board Resolution" means a resolution duly adopted by the Board of
Directors, a copy of which, certified by the Secretary or an Assistant Secretary
of the Company to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, shall have been
delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment, Place
of Conversion or any other place, as the case may be, means each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions in such Place of Payment, Place of Conversion or other place, as
the case may be, are authorized or obligated by law or executive order to close;
provided,
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-3-
however, that a day on which banking institutions in New York, New York are
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authorized or obligated by law or executive order to close shall not be a
Business Day for purposes of Section 10.6 or Section 11.5.
------------ ------------
"Change in Control" has the meaning specified in Section 13.4(b).
---------------
"Closing Price Per Share" means, with respect to the Common Stock of
the Company, for any day, (i) the closing price regular way on the New York
Stock Exchange or, (ii) if the Common Stock is not listed on the New York Stock
Exchange, the closing bid price regular way on the Nasdaq National Market, or
the reported last sales 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 New York
Stock Exchange member firm selected from time to time by the Company for that
purpose.
"Code" has the meaning specified in Section 2.1.
-----------
"Commission" means the United States Securities and Exchange
Commission, as from time to time constituted, created under the Exchange Act,
or, if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Common Stock" means the common stock, par value $0.001 per share, of
the Company authorized at the date of this instrument as originally executed.
Subject to the provisions of Section 11.11, shares issuable on conversion or
-------------
repurchase of Securities shall include only shares of Common Stock or shares of
any class or classes of common stock resulting from any reclassification or
reclassifications thereof; provided, however, that if at any
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-4-
time there shall be more than one such resulting class, the shares so issuable
on conversion of Securities shall include shares of all such classes, and the
shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from all
such reclassifications bears to the total number of shares of all such classes
resulting from all such reclassifications.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Notice" has the meaning specified in Section 13.3.
------------
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its Chief Executive Officer, its President or a Vice
President, and by its principal financial officer, Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Constituent Person" has the meaning specified in Section 11.11.
-------------
"Conversion Agent" means any Person authorized by the Company to
convert Securities in accordance with Article Eleven. The Company has initially
--------------
appointed the Trustee as its Conversion Agent in the City and County of San
Francisco.
"Conversion Price" has the meaning specified in Section 13.4(c).
---------------
"Conversion Rate" has the meaning specified in Section 11.1.
------------
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered (which at the date of this Indenture is located at
_____________________).
-5-
"corporation" means a corporation, company, association, joint-stock
company or business trust.
"Defaulted Interest" has the meaning specified in Section 3.7.
-----------
"Depositary" means, with respect to any Registered 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 Registered Securities
(or any successor securities clearing agency so registered).
"Designated Senior Debt" means 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 this 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).
"Dollar" or " U.S.$" means a dollar or other equivalent unit in such
coin or currency of the United States as at the time shall be legal tender for
the payment of public and private debts.
"DTC" means The Depository Trust Company, a New York corporation.
"Event of Default" has the meaning specified in Section 5.1.
-----------
"Exchange Act" means the United States Securities Exchange Act of
1934 (or any successor statute), as amended from time to time.
"Global Security" means a Security that is registered in the Security
Register in the name of a Depositary or a nominee thereof.
-6-
"Holder" means the Person in whose name the Security is registered in
the Security Register.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.
"Interest Payment Date" means the Stated Maturity of an installment
of interest on the Securities.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption, exercise of the repurchase right set forth in
Article Thirteen or otherwise.
----------------
"Non-electing Share" has the meaning specified in Section 11.11.
-------------
"Notice of Default" has the meaning specified in Section 5.1.
-----------
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, a Vice Chairman of the Board, the Chief Executive Officer, the
President or a Vice President and by the principal financial officer, the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company and who shall be acceptable to the Trustee.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all
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Securities theretofore authenticated and delivered under this Indenture, except:
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(i) Securities theretofore cancelled by the Trustee or delivered
to the Trustee for cancellation;
(ii) Securities for the payment or redemption of which money in the
necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its
own Paying Agent) for the Holders of such Securities, provided that if
--------
such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and
(iii) Securities which have been paid pursuant to Section 3.6 or in
-----------
exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than any
such Securities in respect of which there shall have been presented to
the Trustee proof satisfactory to it that such Securities are held by
a bona fide purchaser in whose hands such Securities are valid
obligations of the Company; and
(iv) Securities converted into Common Stock pursuant to Article
Eleven
provided, however, that in determining whether the Holders of the requisite
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principal amount of Outstanding Securities are present at a meeting of Holders
of Securities for quorum purposes or have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Secur ities or any Affiliate of
the Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such determination as to the presence of a quorum or upon
any such request, demand,
-8-
authorization, direction, notice, consent or waiver, only Securities which a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or interest on any Securities on behalf of the Company and, except
as otherwise specifically set forth herein, such term shall include the Company
if it shall act as its own Paying Agent. The Company has initially appointed
the Trustee as its Paying Agent in the City and County of San Francisco.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, trust, estate, unincorporated organization
or government or any agency or political subdivision thereof.
"Place of Conversion" has the meaning specified in Section 3.1.
-----------
"Place of Payment" has the meaning specified in Section 3.1.
-----------
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.6 in exchange for or in
-----------
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Record Date" means any Regular Record Date or Special Record Date.
"Record Date Period" means the period from the close of business of
any Regular Record Date next preceding
-9-
any Interest Payment Date to the opening of business on such Interest Payment
Date.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Regular Record Date" for interest payable in respect of any
Registered Security on any Interest Payment Date means the __ day of _______ or
the __ day of ________ (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date.
"Repurchase Date" has the meaning specified in Section 13.1.
------------
"Repurchase Price" has the meaning specified in Section 13.1.
------------
"Responsible Officer", when used with respect to the Trustee, means
any officer within the Corporate Trust Office of the Trustee, including, without
limitation, any vice president, assistant vice president, assistant treasurer,
corporate trust officer or other employee of the Trustee customarily performing
functions similar to those performed by any of the above designated officers,
and also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his knowledge and familiarity
with the particular subject.
"Securities" has the meaning ascribed to it in the first paragraph
under the caption "Recitals of the Company".
"Securities Act" means the United States Securities Act of 1933 (or
any successor statute), as amended from time to time.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 3.5.
-----------
-10-
"Senior Debt" means the principal of (and premium, if any) and
interest (including all interest accruing subsequent to the commencement of any
bankruptcy or similar proceeding, whether or not a claim for post-petition
interest is allowable as a claim in any such proceeding) on, and all fees and
other amounts payable in connection with, the following, whether absolute or
contingent, secured or unsecured, due or to become due, outstanding on the date
of this Indenture or thereafter created, incurred or assumed: (a) all
indebtedness of the Company evidenced by credit or loan agreements, notes,
bonds, debentures, or other similar instruments, (b) all obligations of the
Company for money borrowed, (c) all obligations of the Company (1) as lessee
under leases required to be capitalized on the balance sheet of the lessee under
generally accepted accounting principles and (2) as lessee under other leases
for facilities, equipment, or other assets, whether or not capitalized, entered
into for financing purposes (including any so-called "synthetic leases"), (d)
all obligations of the Company under interest rate and currency swaps, caps,
floors, collars, hedge agreements, forward contracts, or similar agreements or
arrangements including, without limitation, agreements and arrangements intended
to protect the Company against fluctuations in interest or currency exchange
rates or commodity prices, (e) all obligations of the Company with respect to
letters of credit, bank guarantees, bankers' acceptances and similar facilities
issued for the account of the Company and all reimbursement obligations of the
Company with respect to the foregoing, (f) all obligations of the Company issued
or assumed as the deferred purchase price of any business, property, assets
(including intangibles) or services (but excluding trade accounts payable and
accrued liabilities that constitute liabilities arising in the ordinary course
of business), (g) all obligations of the Company of the type referred to in
clauses (a) through (f) above of another Person and all dividends of another
Person, the payment of which, in either case, the Company has assumed or
guaranteed, or for which the Company is responsible or liable, directly or
indirectly, jointly or severally, as obligor, guarantor or otherwise, or which
is secured by a lien on property of the Company, and (h) renewals, extensions,
modifications, replacements, restatements and refundings of, or any indebtedness
or obligation issued in exchange for, any such indebtedness or
-11-
obligation described in clauses (a) through (g) of this paragraph; provided,
--------
however, that Senior Debt shall not include the Securities or any such
-------
indebtedness or obligation if the terms of such indebtedness or obligation (or
the terms of the instrument under which, or pursuant to which it is issued)
expressly provides that such indebtedness or obligation is not superior in right
of payment to the Securities; provided, further, that Senior Debt shall not
-------- -------
include any indebtedness or obligation owed by the Company to any direct or
indirect Subsidiary.
" Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Company pursuant to Section 3.7.
-----------
" Stated Maturity", when used with respect to any Security or any
installment of interest thereon, means the date specified in such Security as
the fixed date on which the principal of such Security or such installment of
interest is due and payable.
" Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means stock
or other similar interests in the corporation which ordinarily has or have
voting power for the election of directors, or persons performing similar
functions, whether at all times or only so long as no senior class of stock or
other interests has or have such voting power by reason of any contingency.
" Successor Security" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that evidenced
by, such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.6 in exchange for or in
-----------
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
-12-
"Trading Days" means (i) if the Common Stock is listed or admitted
for trading on any national securities exchange, days on which such national
securities exchange is open for business; (ii) if the Common Stock is quoted on
the Nasdaq National Market or any other system of automated dissemination of
quotations of securities prices, days on which trades may be effected through
such system; or (iii) if the Common Stock is not listed or admitted for trading
on any national securities exchange or quoted on the Nasdaq National Market or
any other system of automated dissemination of quotation of securities prices,
days on which the Common Stock is traded regular way in the over-the-counter
market and for which a closing bid and a closing asked price for the Common
Stock are available.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instru ment was executed; provided, however,
-------- -------
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"United States" means the United States of America (including the
States and the District of Columbia), its territories, its possessions and other
areas subject to its jurisdiction (its "possessions" including Puerto Rico, the
U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana
Islands).
"Vice President", when used with respect to the Company, means any
vice president, whether or not designated by a number or a word or words added
before or after the title "vice president".
SECTION 1.2. Compliance Certificates and Opinions.
------------------------------------
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Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with and, if required by the Trust Indenture Act, an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if
any, have been complied with, except that in the case of any such application or
request as to which the furnishing of such documents is specifically required by
any provision of this Indenture relating to such particular application or
request, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (including certificates
provided for in Section 9.7) shall include:
-----------
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(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 individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.3. Form of Documents Delivered to the Trustee.
------------------------------------------
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be cer-
-14-
tified by, or covered by the opinion of, only one such Person, or that they be
so certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representa tions by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the cer tificate or opinion or representations
with respect to the matters upon which such certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company or any other Person
stating that the information with respect to such factual matters is in the
possession of the Company or such other Person, unless such counsel knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4. Acts of Holders of Securities.
-----------------------------
(a) Any request, demand, authorization, direc tion, notice, consent,
waiver or other action provided or permitted by this Indenture to be given or
taken by Holders of Securities may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent or proxy duly appointed in writing by such Holders. Such action
shall become effective when such instrument or instruments record is delivered
to the Trustee and, where it is hereby expressly required, to the Company. The
Trustee shall promptly deliver to the Company copies of all such
-15-
instruments delivered to the Trustee. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders of Securities signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent or proxy, or of the holding by any Person of a
Security, shall be sufficient for any purpose of this Indenture and (subject to
Section 6.1) conclusive in favor of the Trustee and the Company if made in the
-----------
manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a cer tificate of a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority.
(c) The principal amount and serial number of any Security held by
any Person, and the date of his holding the same, shall be proved by the
Security Register.
(d) The fact and date of execution of any such instrument or writing
and the authority of the Person executing the same may also be proved in any
other manner which the Trustee deems sufficient; and the Trustee may in any
instance require further proof with respect to any of the matters referred to in
this Section 1.4.
-----------
(e) The Company may set any day as the record date for the purpose of
determining the Holders entitled to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action, or to vote on
any action, authorized or permitted by this Indenture to be given or taken by
Holders. Promptly and in any case not later than ten days after setting a
record date, the Company shall notify the Trustee and the Holders of such record
date. If not set by the Company prior to the first solicitation of a Holder
made by any Person in respect of any such action, or, in the case of any such
vote, prior to
-16-
such vote, the record date for any such action or vote shall be the 30th day
(or, if later, the date of the most recent list of Holders required to be
provided pursuant to Section 14.1) prior to such first solicitation or vote, as
------------
the case may be. With regard to any record date, the Holders on such date (or
their duly appointed agents or proxies), and only such Persons, shall be
entitled to give or take, or vote on, the relevant action, whether or not such
Holders remain Holders after such record date. Notwithstanding the foregoing,
the Company shall not set a record date for, and the provisions of this
paragraph shall not apply with respect to, any notice, declaration or direction
referred to in the next paragraph.
Upon receipt by the Trustee from any Holder of (i) any notice of
default or breach referred to in Section 5.1(4), if such default or breach has
--------------
occurred and is continuing and the Trustee shall not have given such a notice to
the Company, (ii) any declaration of acceleration referred to in Section 5.2, if
-----------
an Event of Default has occurred and is continuing and the Trustee shall not
have given such a declaration to the Company, or (iii) any direction referred to
in Section 5.12, if the Trustee shall not have taken the action specified in
------------
such direction, then, with respect to clauses (ii) and (iii), a record date
shall automatically and without any action by the Company or the Trustee be set
for determining the Holders entitled to join in such declaration or direction,
which record date shall be the close of business on the tenth day (or, if such
day is not a Business Day, the first Business Day thereafter) following the day
on which the Trustee receives such declaration or direction, and, with respect
to clause (i), the Trustee may set any day as a record date for the purpose of
determining the Holders entitled to join in such notice of default. Promptly
after such receipt by the Trustee of any such declaration or direction referred
to in clause (ii) or (iii), and promptly after setting any record date with
respect to clause (i), and as soon as practicable thereafter, the Trustee shall
notify the Company and the Holders of any such record date so fixed. The
Holders on such record date (or their duly appointed agents or proxies), and
only such Persons, shall be entitled to join in such notice, declaration or
direction, whether or not such Holders remain Holders after such record date;
provided
--------
-17-
that, unless such notice, declaration or direction shall have become effective
by virtue of Holders of the requisite principal amount of Securities on such
record date (or their duly appointed agents or proxies) having joined therein on
or prior to the 90th day after such record date, such notice, declaration or
direction shall automatically and without any action by any Person be cancelled
and of no further effect. Nothing in this paragraph shall be construed to
prevent a Holder (or a duly appointed agent or proxy thereof) from giving,
before or after the expiration of such 90-day period, a notice, declaration or
direction contrary to or different from, or, after the expiration of such
period, identical to, the notice, declaration or direction to which such record
date relates, in which event a new record date in respect thereof shall be set
pursuant to this paragraph. In addition, nothing in this paragraph shall be
construed to render ineffective any notice, declaration or direction of the type
referred to in this paragraph given at any time to the Trustee and the Company
by Holders (or their duly appointed agents or proxies) of the requisite
principal amount of Securities on the date such notice, declaration or direction
is so given.
(f) Except as provided in Sections 5.12 and 5.13, any request,
------------- ----
demand, authorization, direction, notice, consent, election, waiver or other Act
of the Holder of any Security shall bind every future Holder of the same
Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
SECTION 1.5. Notices, Etc., to Trustee and Company.
-------------------------------------
Any request, demand, authorization, direction, notice, consent,
election, waiver or other Act of Holders of Securities or other document
provided or permitted by this Indenture to be made upon, given or furnished to,
or filed with,
(1) the Trustee by any Holder of Securities or by the Company shall
be sufficient for every purpose
-18-
hereunder if made, given, furnished or filed in writing to or with the
Trustee and received at its Corporate Trust Office, Attention:
_________________, and shall be deemed given when received.
(2) the Company by the Trustee or by any Holder of Securities shall
be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing, mailed, first-class postage prepaid, or
telecopied and confirmed by mail, first-class postage prepaid, or delivered
by hand or overnight courier, addressed to the Company at 00 Xxxxxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000, Attention:
_____________ (telecopy no.: _________________, or at any other address
previously furnished in writing to the Trustee by the Company, and shall be
deemed given when received.
Any request, demand, authorization, direction, notice, consent,
election or waiver required or permitted under this Indenture shall be in the
English language, except that any published notice may be in an official
language of the country of publication.
SECTION 1.6. Notice to Holders of Securities; Waiver.
---------------------------------------
Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of Securities of any event, such notice shall be
sufficiently given to Holders if in writing and mailed, first-class postage
prepaid, to each Holder of a Security affected by such event, at the address of
such Holder as it appears in the Security Register, not earlier than the
earliest date and not later than the latest date prescribed for the giving of
such notice.
Neither the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. In case by reason of the suspension of regular
mail service or by reason of any other cause it shall be impracticable to give
such notice by mail, then such notification to Holders as shall be made with the
approval of the Trustee, which approval shall not be
-19-
unreasonably withheld or delayed, shall constitute a sufficient notification to
such Holders for every purpose hereunder.
Such notice shall be deemed to have been given when such notice is
mailed.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders of Securities shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
SECTION 1.7. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.8. Successors and Assigns.
----------------------
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 1.9. Separability Clause.
-------------------
In case any provision in this Indenture or the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 1.10. Benefits of Indenture.
---------------------
Except as provided in the next sentence, nothing in this Indenture or
in the Securities, express or implied, shall give to any Person, other than the
parties hereto and their successors and assigns hereunder and the Holders of
Securities, any benefit or legal or equitable right, remedy
-20-
or claim under this Indenture. The provisions of Article Twelve are intended to
--------------
be for the benefit of, and shall be enforceable directly by, the holders of
Senior Debt.
SECTION 1.11. Governing Law.
-------------
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, THE UNITED STATES OF
AMERICA, WITHOUT REGARD TO THE CONFLICTS OF LAWS PRINCIPLES THEREOF.
SECTION 1.12. Legal Holidays.
--------------
In any case where any Interest Payment Date, Redemption Date,
Repurchase Date or Stated Maturity of any Security or the last day on which a
Holder of a Security has a right to convert his Security shall not be a Business
Day at a Place of Payment or Place of Conversion, as the case may be, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of principal of, premium, if any, or interest on, or the payment of the
Repurchase Price (whether the same is payable in cash or in shares of Common
Stock) with respect to, or delivery for conversion of, such Security need not be
made at such Place of Payment or Place of Conversion, as the case may be, on or
by such day, but may be made on or by the next succeeding Business Day at such
Place of Payment or Place of Conversion, as the case may be, with the same force
and effect as if made on the Interest Payment Date, Redemption Date or
Repurchase Date, or at the Stated Maturity or by such last day for conversion;
provided, however, that in the case that payment is made on such succeeding
-------- -------
Business Day, no interest shall accrue on the amount so payable for the period
from and after such Interest Payment Date, Redemption Date, Repurchase Date,
Stated Maturity or last day for conversion, as the case may be.
SECTION 1.13. Conflict with Trust Indenture Act.
---------------------------------
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the latter provision shall control. If any
provision of this Indenture modifies or excludes any provi-
-21-
sion of the Trust Indenture Act that may be so modified or excluded, the latter
provision shall be deemed to apply to this Indenture as so modified or to be
excluded, as the case may be.
-22-
ARTICLE TWO
SECURITY FORMS
SECTION 2.1. Form Generally.
--------------
The Securities shall be in substantially the form set forth in this
Article, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or the Internal Revenue Code of 1986, as amended, and
regulations thereunder (the "Code"), or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof. All Securities shall be issued in registered form, as
opposed to bearer form.
The Trustee's certificates of authentication shall be in substantially
the form set forth in Section 2.3.
-----------
Conversion notices shall be in substantially the form set forth in
Section 2.4.
-----------
Repurchase notices shall be substantially in the form set forth in
Section 2.2.
-----------
The Securities shall be printed, lithographed, typewritten or engraved
or produced by any combination of these methods on steel engraved borders if so
required by any securities exchange upon which the Securities may be listed, or
may be produced in any other manner permitted by the rules of any such
securities exchange, or, if the Securities are not listed on a securities
exchange, in any other manner approved by the Company, all as determined by the
officers executing such Securities, as evidenced by their execution thereof.
Upon their original issuance, Securities shall be issued in the form
of one or more Global Securities without interest coupons and shall be
registered in the name of DTC, as Depositary, or its nominee and deposited with
the
-23-
Trustee, as custodian for DTC, for credit by DTC to the respective accounts of
beneficial owners of the Securities represented thereby (or such other accounts
as they may direct).
SECTION 2.2. Form of Security
----------------
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH GLOBAL SECURITY:
THIS SECURITY 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 SECURITY 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 DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
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 REGISTERED
SECURITIES 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 OR SUCH
SUCCESSOR DEPOSITARY.]
-24-
DIGITAL ISLAND, INC.
__% CONVERTIBLE SUBORDINATED NOTES
DUE ____________, 2005
No. _____________ U.S.$_____
CUSIP No._______
DIGITAL ISLAND, INC., a corporation duly organized and existing under
the laws of the State of Delaware (herein called the "Company", which term
includes any successor Person under the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay to _______________, or
registered assigns, the principal sum of _____________ United States Dollars
(U.S.$ _____) [if this Security is a Global Security, then insert - (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 Securities, shall not exceed $______________ in the aggregate at any
time) by adjustments made on the records of the Trustee hereinafter referred to
in accordance with the Indenture)] on __________, 2005 and to pay interest
thereon, from __________, 2000, 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 _________ and __________ in each year (each, an "Interest
Payment Date"), commencing __________, 2000, at the rate of __% per annum, until
the principal hereof is due, and at the rate of __% 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 Security (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 __ day of __________ or __ day of __________
(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
-25-
the Person in whose name this Security (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 Securities not less than 10 days prior to such Special
Record Date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Securities may be
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 Security at the option of the Holder 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, 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, or at such other offices or agencies as the Company may designate, by
United States Dollar check drawn on, or wire transfer to, a United States Dollar
account (such a wire transfer to be made only to a Holder of an aggregate
principal amount of Securities in excess of U.S.$2,000,000, and only if such
Holder shall have furnished wire instructions in writing to the Trustee no later
than 15 days prior to the relevant payment date) maintained by the payee with a
bank in the Borough of Manhattan, The City of New York. Payment of interest on
this Security may be made by United States Dollar check drawn on a bank in the
Borough of Manhattan, The City of New York mailed to the address of the Person
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 wire transfer to a
United States Dollar account (such a wire transfer to be made only to a Holder
of an aggregate principal amount of Registered Securities in excess of
U.S.$2,000,000 and only if such Holder shall have furnished wire instructions in
writing to the Trustee no later than 15 days prior to the relevant payment date)
maintained by the payee with a bank in the Borough of Manhattan, The City of New
York.
Except as specifically provided herein and in the Indenture, the
Company shall not be required to make any
-26-
payment with respect to any tax, assessment or other govern mental charge
imposed by any government or any political subdivision or taxing authority
thereof or therein.
Reference is hereby made to the further provisions of this Security
set forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof or an Authenticating Agent by the
manual signature of one of their respective authorized signatories, this
Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
-27-
IN WITNESS WHEREOF, the Company has caused this Security to be duly
executed under its corporate seal.
DIGITAL ISLAND, INC.
[Corporate Seal]
By:___________________________
Name:
Title:
Attest:
________________________
Name:
Title:
-28-
[FORM OF REVERSE]
This Security is one of a duly authorized issue of securities of the
Company designated as its "__% Convertible Subordinated Notes due ____________,
2005" (herein called the "Securities"), limited in aggregate principal amount to
U.S.$__________, issued and to be issued under an Indenture, dated as of
____________, 2000 (herein called the "Indenture"), between the Company and
State Street Bank and Trust Company, as Trustee (herein called the "Trustee",
which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee, the holders of Senior Debt and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. As provided in the Indenture and
subject to certain limitations therein set forth, Securities are exchangeable
for a like aggregate principal amount of Securities of any authorized
denominations as requested by the Holder surrendering the same upon surrender of
the Security or Securities to be exchanged, at the Corporate Trust Office of the
Trustee. The Trustee upon such surrender by the Holder will issue the new
Securities in the requested denominations.
No sinking fund is provided for the Securities.
The Securities are subject to redemption at the option of the Company
at any time on or after __________, 2003, 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 __________ of the
following years:
Year Redemption Price
---- -----------------
2003...................... %
2004...................... %
2005...................... %
-29-
and at a Redemption Price equal to 100% of the principal amount on and after
____________, 200_, together, in each case, with accrued interest to the
Redemption Date; provided, however, that interest installments on Securities
-------- -------
whose Stated Maturity is on or prior to such Redemption Date will be payable to
the Holders of such Securities, 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 Securities, the Company will not
be required (a) to register the transfer or exchange of Securities for a period
of 15 days immediately preceding the date notice is given identifying the serial
numbers of the Securities called for such redemption or (b) to register the
transfer or exchange of any Security, or portion thereof, called for redemption.
Notice to the Holders will be given not less than 30 nor more than 60
days prior to the Redemption Date as provided in the Indenture.
In any case where the due date for the payment of the principal of,
premium, if any, or interest on any Security or the last day on which a Holder
of a Security has a right to convert his Security 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, or interest, or delivery for conversion of such Security 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 from and after such due
date.
-30-
Subject to and upon compliance with the provisions of the Indenture,
the Holder of this Security is entitled, at his option, at any time following
the original issue date of the Securities and on or before the close of business
on ____________, 200_, or in case this Security or a portion hereof is called
for redemption or the Holder hereof has exercised his right to require the
Company to repurchase this Security or such portion hereof, then in respect of
this Security until and including, 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 the Business Day immediately preceding the Redemption
Date or the Repurchase Date, as the case may be, to convert this Security (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 __________ for each share of Common Stock (or at the current
adjusted Conversion Rate if an adjustment has been made as provided in the
Indenture) by surrender of this Security, 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 Security has been called for redemption on a Redemption Date or
is repurchasable on a Repurchase Date, with the consequence that the conversion
right of such Security would terminate 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 Security 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 City and County of San Francisco, or at
such other offices or agencies as the Company may designate (each a
-31-
"Conversion Agent"), provided, further, that in case surrender of this Security
-------- -------
for conversion 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 and if this Security or portion hereof
has been called for redemption on a Redemption Date or is repurchasable on a
Repurchase Date, with the consequence that the conversion right of such Security
would terminate between such Regular Record Date and the close of business on
such Interest Payment Date, then the Holder of this Security 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 shall not be required to pay such interest upon surrender of this Security
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 Security (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 Security is convertible and such delivery will
be deemed to satisfy the Company's obligation to pay the principal amount of
this Security. 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 or the
conveyance, transfer, sale or lease of all or substan tially all of the property
and assets of the Company, the Indenture shall be amended, without the consent
of any
-32-
Holders of Securities, so that this Security, if then Out standing, will be
convertible thereafter, during the period this Security shall be convertible as
specified above, only into the kind and amount of securities, cash and other pro
perty 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 Security 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, failed to exercise any rights of
election and received per share the kind and amount received per share by a
plurality of Non-electing Shares). 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 rate, provided that any adjustment that would otherwise be made
--------
will be carried forward and taken into account in the computation of any
subsequent adjustment.
In the event of redemption, repurchase or conversion of this Security
in part only, a new Security or Securities for the unredeemed, unrepurchased or
unconverted portion hereof will be issued in the name of the Holder hereof upon
the cancellation hereof.
If a Change in Control occurs, the Holder of this Security, at the
Holder's option, shall have the right, in accordance with the provisions of the
Indenture, to require the Company to repurchase this Security (or any portion of
the principal amount hereof that is equal to U.S.$1,000 or any integral multiple
of 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 Price Per
Share for the five consecutive Trading Days immediately preceding and including
the third Trading Day prior to the Repurchase Date. Whenever in this Security
there is a
-33-
reference, in any context, to the principal of any Security as of any time, such
reference shall be deemed to include reference to the Repurchase Price payable
in respect of such Security 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 Security shall not be construed as excluding the
Repurchase Price so payable in those provisions of this Security when such
express mention is not made; provided, however, that, for the purposes of the
-------- -------
paragraph below concerning the consequences of an Event of Default, 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 Security that is not a
Global Security:
In the event of redemption, repurchase or conversion of this Security
in part only, a new Security or Securities for the unredeemed, unrepurchased or
unconverted portion hereof will be issued in the name of the Holder hereof.]
[The following paragraph shall appear in each Global Security:
In the event of a deposit or withdrawal of an interest in this
Security, including an exchange, transfer, redemption, repurchase or conversion
of this Security 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 Applicable Procedures.]
The indebtedness evidenced by this Security 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 of all Senior Debt of the Company, and this
Security is issued subject to such provisions of the Inden ture with respect
thereto. Each Holder of this Security, 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
-34-
(c) appoints the Trustee his attorney-in-fact for any and all such purposes.
If an Event of Default shall occur and be contin uing, the principal
of all the Securities, 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 Securities
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 Securities under the Indenture at
any time by the Company and the Trustee with the written consent of the Holders
of a majority in principal amount of the Securities at the time Outstanding.
The Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities at the time Outstanding, on
behalf of the Holders of all the Securities, 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 Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security or such other
Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security 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 Securities shall have made
written request to the Trustee to institute
-35-
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 Securities Outstanding 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 Security for the enforcement of any payment of principal hereof, premium,
if any, or interest hereon on or after the respective due dates expressed herein
or for the enforcement of the right to convert this Security as provided in the
Indenture.
No reference herein to the Indenture and no provi sion of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, premium,
if any, and interest on this Security at the times, places and rate, and in the
coin or currency, herein prescribed or to convert this Security as provided in
the Indenture.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register upon surrender of this Security 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 City and County of
San Francisco, 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 Securities, 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.
-36-
Prior to due presentation of this Security for registration of
transfer, the Company, the Trustee, any Authenticating Agent or any other agent
of the Company or the Trustee may treat the Person in whose name this Security
is registered as the owner hereof for all purposes, whether or not this Security
be overdue, and neither the Company, the Trustee nor any Authenticating Agent or
other agent of the Company or the Trustee shall be affected by notice to the
contrary.
Interest on the Securities shall be computed on the basis of a 360-day
year of twelve 30-day months.
The Indenture and this Security shall be governed by and construed in
accordance with the laws of the State of New York, United States of America,
without regard to the conflicts of laws principles thereof.
All terms used in this Security that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
-37-
ABBREVIATIONS
The following abbreviations, when used in the inscription of the face
of this Security, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT -- ______________
TEN ENT - as tenants by the
entireties (Cust)
JT TEN - as joint tenants with Custodian _____________ under Uniform
right of
survivorship and (Minor)
not as tenants in Gifts to Minors Act ________________
common
(State)
Additional abbreviations may also be used
though not in the above list.
-38-
ELECTION OF HOLDER TO REQUIRE REPURCHASE
1. Pursuant to Section 13.1 of the Indenture, the undersigned hereby
------------
elects to have this Security repurchased by the Company.
2. The undersigned hereby directs the Trustee or the Company to pay it or
__________________ 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
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
(an integral multiple of U.S.$1,000):
Remaining principal amount following such repurchase:
______________________
NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Security in every particular, without alteration
or any change whatsoever.
-39-
SECTION 2.3. Form of Certificate of Authentication.
-------------------------------------
The Trustee's certificates of authentication shall be in substantially the
following form:
Dated: [Date of Authentication]
This is one of the Securities referred to in the within-mentioned
Indenture.
______________________________
as Trustee
By:___________________________
Authorized Signatory
SECTION 2.4. Form of Conversion Notice.
-------------------------
CONVERSION NOTICE
The undersigned Holder of this Security hereby irrevocably exercises the
option to convert this Security, or any portion of the principal amount hereof
(which is an integral multiple of U.S.$1,000) below designated, into shares of
Common Stock in accordance with the terms of the Indenture referred to in this
Security, and directs that such shares, together with a check in payment for any
fractional share and any Securities representing any unconverted principal
amount hereof, be delivered to and be registered in the name of the undersigned
unless a different name has been indicated below. If shares of Common Stock or
Securities are to be registered in the name of a Person other than the
undersigned, (a) the undersigned will pay all transfer taxes payable with
respect thereto and (b) signature(s) must be guaranteed by an Eligible Guarantor
Institution with membership in an approved signature guarantee program pursuant
to Rule 17Ad-15 under the Securities Exchange Act of 1934. Any amount required
to be paid by the undersigned on account of interest accompanies this Security.
-40-
Dated: _____________________
____________________
Signature
If shares or Securities are If only a portion of the
to be registered in the name Securities is to be
of a Person other than the converted, please indicate:
Holder, please print such
Person's name and address:
1. Principal amount to be
converted:
_________________________ U.S.$___________
Name (any integral multiple of
U.S. $1,000)
2. Principal amount and
_________________________ denomination of
Address Securities representing
unconverted principal
amount to be issued:
_________________________
Social Security or other Amount: U.S.$________
Taxpayer Identification
Number, if any Denominations:
U.S.$______
(any integral multiple of
U.S.$1,000)
___________________________ [Signature Guaranteed]
SECTION 2.5. Form of Assignment.
------------------
-41-
For value received _____________________________ hereby sell(s),
assign(s) and transfer(s) unto ______________________. (Please insert social
security or other identifying number of assignee) the within Security, and
hereby irrevocably constitutes and appoints __________________________ as
attorney to transfer the said security on the books of the Company, with full
power of substitution in the premises.
Dated:
_____________________________________________
_____________________________________________
Signature
Signature(s) must be guaranteed by an
Eligible Guarantor Institution with
membership in an approved signature guarantee
program pursuant to Rule 17Ad-15 under the
Securities Exchange Act of 1934.
ARTICLE THREE
THE SECURITIES
SECTION 3.1. Title and Terms.
---------------
The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is limited to U.S.$__________, except for
Securities authenticated and delivered in exchange for, or in lieu of, other
Securities pursuant to Section 3.4, 3.5, 3.6, 8.5, 10.8, 11.2 or 13.3(e).
----------- --- --- --- ---- ---- -------
The Securities shall be known and designated as the "__% Convertible
Subordinated Notes due _________, 2005" of
-42-
the Company. Their Stated Maturity shall be __________, 2005 and they shall bear
interest on their principal amount from __________, 2000, payable semi-annually
in arrears on ____________ and ____________ in each year, commencing
____________, 2000, at the rate of __% per annum until the principal thereof is
due and at the rate of __% per annum on any overdue principal and, to the extent
permitted by law, on any overdue interest; provided, however, that payments
-------- -------
shall only be made on Business Days as provided in Section 1.12.
------------
The principal of, premium, if any, and interest on the Securities shall
be payable as provided in the form of Securities set forth in Section 2.2, and
-----------
the Repurchase Price, whether payable in cash or in shares of Common Stock,
shall be payable at such places as are identified in the Company Notice given
pursuant to Section 13.3 (any city in which any Paying Agent is located being
------------
herein called a "Place of Payment").
The Securities shall be redeemable at the option of the Company, as
provided in Article Ten and in the form of Securities set forth in Section 2.2.
----------- -----------
The Securities are not entitled to the benefit of any sinking fund.
The Securities shall be convertible as provided in Article Eleven (any
--------------
city in which any Conversion Agent is located being herein called a "Place of
Conversion").
The Securities shall be subordinated in right of payment to Senior Debt
of the Company as provided in Article Twelve.
--------------
The Securities shall be subject to repurchase by the Company at the
option of the Holders as provided in Article Thirteen.
----------------
SECTION 3.2. Denominations.
-------------
The Securities shall be issuable only in registered form, without
coupons, in denominations of U.S.$1,000 and integral multiples thereof.
-43-
SECTION 3.3. Execution, Authentication, Delivery and Dating.
----------------------------------------------
The Securities shall be executed on behalf of the Company by its Chairman
of the Board, its Vice Chairman of the Board, its Chief Executive Officer, its
President or one of its Vice Presidents, under a facsimile of its corporate seal
reproduced thereon attested by its Secretary or one of its Assistant
Secretaries. Any such signature may be manual or facsimile.
Securities bearing the manual or facsimile signature of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities executed by the Company to
the Trustee or to its order for authentication, together with a Company Order
for the authentication and delivery of such Securities, and the Trustee in
accordance with such Company Order shall authenticate and make available for
delivery such Securities as in this Indenture provided and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature of an authorized signatory, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
SECTION 3.4. Global Securities; Non-Global Securities.
----------------------------------------
-44-
(A) Global Securities
-----------------
(a) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated by the Company for such
Global Security or a nominee thereof and delivered to such Depositary or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Security or a nominee
thereof unless (i) such Depositary (A) has notified the Company that it is
unwilling or unable to continue as Depositary for such Global Security or (B)
has ceased to be a clearing agency registered as such under the Exchange Act or
announces an intention permanently to cease business or does in fact do so or
(ii) there shall have occurred and be continuing an Event of Default with
respect to such Global Security.
(c) If any Global Security is to be exchanged for other Securities or
canceled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Trustee, as Security Registrar, for exchange or cancellation,
as provided in this Article Three. If any Global Security is to be exchanged
-------------
for other Securities or cancelled in part, or if another Security is to be
exchanged in whole or in part for a beneficial interest in any Global Security,
in each case, as provided in Section 3.5, then either (i) such Global Security
-----------
shall be so surrendered for exchange or cancellation, as provided in this
Article Three, or (ii) the principal amount thereof shall be reduced or
-------------
increased by an amount equal to the portion thereof to be so exchanged or
cancelled, or equal to the principal amount of such other Security to be so
exchanged for a beneficial interest therein, as the case may be, by means of an
appropriate adjustment made on the records of the Trustee, as Security
Registrar, whereupon the Trustee, in accordance with the Applicable Procedures,
shall instruct the Depositary or its authorized representative to make a
-45-
corresponding adjustment to its records. Upon any such surrender or adjustment
of a Global Security, the Trustee shall, subject to Section 3.5(c) and as
--------------
otherwise provided in this Article Three, authenticate and make available for
-------------
delivery any Securities issuable in exchange for such Global Security (or any
portion thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in the preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of Global
Securities. The Trustee shall be entitled to rely upon any order, direction or
request of the Depositary or its authorized representative which is given or
made pursuant to this Article Three if such order, direction or request is given
-------------
or made in accordance with the Applicable Procedures.
(d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article Three or otherwise, shall be
-------------
authenticated and delivered in the form of, and shall be, a registered Global
Security, unless such Security is registered in the name of a Person other than
the Depositary for such Global Security or a nominee thereof, in which case such
Registered Security shall be authenticated and delivered in definitive, fully
registered form, without interest coupons.
(e) The Depositary or its nominee, as registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under the
Indenture and the Registered Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members and
such owners of beneficial interests in a Global Security will not be considered
the owners or holders thereof.
-46-
(B) Non-Global Securities
---------------------
Pending the preparation of definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and make
available for delivery, temporary Securities which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Registered Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Registered
Securities may determine, as evidenced by their execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at any office
or agency of the Company designated pursuant to Section 9.2, without charge to
-----------
the Holder. Upon surrender for cancellation of any one or more temporary
Securities the Company shall execute and the Trustee shall authenticate and make
available for delivery in exchange therefor a like principal amount of
definitive Securities of authorized denominations. Until so exchanged the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.
SECTION 3.5. Registration, Registration of Transfer and Exchange; Restrictions
-----------------------------------------------------------------
on Transfer.
-----------
(a) The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register (the register maintained in such office and in any other
office or agency of the Company designated pursuant to Section 9.2 being herein
-----------
sometimes collectively referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of Securities and of transfers of Securities. The Trustee
is hereby appointed "Security Registrar" for the purpose of registering
Securities and transfers and exchanges of Securities as herein provided.
-47-
Upon surrender for registration of transfer of any Security at an office
or agency of the Company designated pursuant to Section 9.2 for such purpose,
-----------
the Company shall execute, and the Trustee shall authenticate and deliver, in
the name of the designated transferee or transferees, one or more new Securities
of any authorized denominations and of a like aggregate principal amount.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination and of a like aggregate principal
amount, upon surrender of the Securities to be exchanged at any such office or
agency. Whenever any Securities are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and make available for
delivery, the Securities which the Holder making the exchange is entitled to
receive. Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company or the Security Registrar)
be duly endorsed, or be 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.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
No service charge shall be made for any registration of transfer or
exchange of Securities except as provided in Section 3.6, but the Company may
-----------
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Securities, other than exchanges pursuant to Section 3.4, 8.5, 10.8,
----------- --- ----
11.2 or 13.3 (other than where the shares of Common Stock are to be issued or
---- ----
delivered in a name other than that of the Holder of the Security) not involving
any transfer and other than any stamp and other duties, if any, which may be
imposed in connection with any such transfer or exchange by the United
-48-
States or any political subdivision thereof or therein, which shall be paid by
the Company.
In the event of a redemption of the Securities, the Company will not be
required (a) to register the transfer of or exchange Securities for a period of
15 days immediately preceding the date notice is given identifying the serial
numbers of the Securities called for such redemption or (b) to register the
transfer of or exchange any Security, or portion thereof, called for redemption.
(b) Neither the Trustee, the Paying Agent nor any of their agents shall
(1) have any duty to monitor compliance with or with respect to any federal or
state or other securities or tax laws or (2) have any duty to obtain
documentation on any transfers or exchanges other than as specifically required
hereunder.
SECTION 3.6. Mutilated, Destroyed, Lost or Stolen Securities.
-----------------------------------------------
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and make available for delivery
in exchange therefor a new Security of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there be delivered to the Company and to the Trustee:
(1) evidence to their satisfaction of the destruction, loss or theft of
any Security, and
(2) such security or indemnity as may be satisfactory to the Company and
the Trustee to save each of them and any agent of either of them harmless,
then, in the absence of actual notice to the Company or the Trustee that such
Security has been acquired by a bona fide purchaser, the Company shall execute
and the Trustee shall authenticate and make available for delivery, in lieu of
any such destroyed, lost or stolen Security, a new Security of
-49-
like tenor and principal amount and bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion, but
subject to any conversion rights, may, instead of issuing a new Security, pay
such Security, upon satisfaction of the conditions set forth in the preceding
paragraph.
Upon the issuance of any new Security under this Section 3.6, the Company
-----------
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto (other than any
stamp and other duties, if any, which may be imposed in connection therewith by
the United States or any political subdivision thereof or therein, which shall
be paid by the Company) and any other expenses (including the fees and expenses
of the Trustee) connected therewith.
Every new Security issued pursuant to this Section 3.6 in lieu of any
-----------
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and such new Security shall be entitled to all the benefits of this Indenture
equally and proportionately with any and all other Securities duly issued
hereunder.
The provisions of this Section 3.6 are exclusive and shall preclude (to
-----------
the extent lawful) all other rights and remedies of any Holder with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.7. Payment of Interest; Interest Rights Preserved.
----------------------------------------------
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest.
-50-
Any interest on any Security which is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date (herein called "Defaulted
Interest") shall forthwith cease to be payable to the Holder on the relevant
Regular Record Date by virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Security, the
date of the proposed payment and the Special Record Date, and at the same
time the Company shall deposit with the Trustee an amount of money equal to
the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for such
deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this Clause provided. The Special Record
Date for the payment of such Defaulted Interest shall be not more than 15
days and not less than 10 days prior to the date of the proposed payment
and not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor to be mailed, first-class
postage prepaid, to each Holder at such Holder's address as it appears in
the Security Register, not less than 10 days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been so mailed, such Defaulted Interest
shall be paid to the Persons in whose names the Securities (or their
respective Predecessor Securities) are registered at
-51-
the close of business on such Special Record Date and shall no longer be
payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may
be required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this Clause, such manner of
payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section and Section 3.5, each
-----------
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Security.
Interest on any Security which is converted in accordance with Section
-------
11.2 during a Record Date Period shall be payable in accordance with the
----
provisions of Section 11.2.
------------
SECTION 3.8. Persons Deemed Owners.
---------------------
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered as the owner of such Security
for the purpose of receiving payment of principal of, premium, if any, and
(subject to Section 3.7) interest on such Security and for all other purposes
-----------
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by
notice to the contrary.
SECTION 3.9. Cancellation.
------------
All Securities surrendered for payment, redemption, repurchase,
registration of transfer or exchange or conversion shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee. All Securities so
-52-
delivered to the Trustee shall be canceled promptly by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
canceled as provided in this Section 3.9. The Trustee shall dispose of all
-----------
canceled Securities in accordance with applicable law and its customary
practices in effect from time to time.
SECTION 3.10. Computation of Interest.
-----------------------
Interest on the Securities shall be computed on the basis of a 360-day
year of twelve 30-day months.
SECTION 3.11. CUSIP Numbers.
-------------
The Company in issuing Securities may use "CUSIP" numbers (if then
generally in use) in addition to serial numbers; the Trustee shall use such
CUSIP numbers in addition to serial numbers in notices of redemption and
repurchase as a convenience to Holders; provided that any such notice may state
--------
that no representation is made as to the correctness of such CUSIP numbers
either as printed on the Securities or as contained in any notice of a
redemption or repurchase and that reliance may be placed only on the serial or
other identification numbers printed on the Securities, and any such redemption
or repurchase shall not be affected by any defect in or omission of such CUSIP
numbers. The Company shall promptly notify the Trustee in writing of any change
in any such CUSIP number.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 4.1. Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of conversion, or registration of transfer or
exchange, or replacement of Securities herein expressly provided for and the
Company's obligations to the Trustee pursuant to Section 6.7), and the Trustee,
-----------
at the expense of the Company, shall execute proper instruments in form and
substance
-53-
satisfactory to the Trustee acknowledging satisfaction and discharge of this
Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 3.6 and (ii)
-----------
Securities for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as provided in
Section 9.3) have been delivered to the Trustee for cancellation; or
-----------
(B) all such Securities not theretofore delivered to the Trustee
or its agent for cancellation (other than Securities referred to in
clauses (i) and (ii) of clause (1)(A) above)
(i) have become due and payable, or
(ii) will have become due and payable at their Stated
Maturity within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of clause (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds
(immediately available to the Holders in the case of clause (i)) in
trust for the purpose an amount sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered to
the Trustee for cancellation, for principal, premium, if any, and
interest to the date of such deposit (in the case of Securities which
have become due and payable) or to the Stated Maturity or Redemption
Date, as the case may be;
-54-
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.7, the obligations of
-----------
the Company to any Authenticating Agent under Section 6.12, if money shall have
------------
been deposited with the Trustee pursuant to clause (1)(B) of this Section 4.1,
-----------
the obligations of the Trustee under Section 4.2 and the last paragraph of
-----------
Section 9.3 and the obligations of the Company and the Trustee under Section 3.5
----------- -----------
and Article Eleven shall survive. Funds held in trust pursuant to this Section
--------------
are not subject to the provisions of Article Twelve.
--------------
SECTION 4.2. Application of Trust Money.
--------------------------
Subject to the provisions of the last paragraph of Section 9.3, all money
-----------
deposited with the Trustee pursuant to Section 4.1 shall be held in trust and
-----------
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent), to the Persons entitled
thereto, of the principal, premium, if any, and interest for whose payment such
money has been deposited with the Trustee.
All moneys deposited with the Trustee pursuant to Section 4.1 (and held
-----------
by it or any Paying Agent) for the payment of Securities subsequently converted
shall be returned to the Company upon Company Request.
ARTICLE FIVE
REMEDIES
-55-
SECTION 5.1. Events of Default.
-----------------
"Event of Default", wherever used herein, means any one of the following
events (whatever the reason for such Event of Default and whether it shall be
occasioned by the provisions of Article Twelve or be voluntary or involuntary or
--------------
be effected by operation of law or pursuant to any judgment, decree or order of
any court or any order, rule or regulation of any administrative or governmental
body):
(1) default in the payment of the principal of or premium, if any, on
any Security at its Maturity, whether or not the such payment is prohibited
by the subordination provisions of this Indenture; or
(2) default in the payment of any interest upon any Security when it
becomes due and payable, and continuance of such default for a period of 30
days, whether or not the such payment is prohibited by the subordination
provisions of this Indenture; or
(3) failure by the Company to give the Company notice in accordance with
Section 13.3; or
------------
(4) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a
default in the performance or breach of which is specifically dealt with
elsewhere in this Section), 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
Securities, a written notice specifying such default or breach and
requiring it to be remedied and stating that such notice is a "Notice of
Default" hereunder;
(5) a default in the payment when due of the principal of, or
acceleration of, any indebtedness under any bond, debenture, note or other
evidence of indebtedness for money borrowed by the Company or any
Subsidiary of the Company or under any mortgage, indenture or instrument
under which there may be issued
-56-
or by which there may be secured or evidenced any indebtedness for money
borrowed by the Company or any Subsidiary of the Company with a principal
amount then outstanding in excess of U.S. 15,000,000, whether such
indebtedness now exists or shall hereafter be created, if the indebtedness
is not discharged, or such acceleration is not rescinded or annulled,
within a period of 30 days after there shall have been given, by registered
or certified mail, to the Company by the Trustee or to the Company and the
Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities a written notice specifying such default and
requiring the Company to cause such indebtedness to be discharged or such
acceleration to be rescinded or annulled and stating that such notice is a
"Notice of Default" hereunder;
(6) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in
respect of the Company under any applicable Federal or State law, or
appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any substantial
part of its property, or ordering the winding up or liquidation of its
affairs, and the continuance of any such decree or order for relief or any
such other decree or order unstayed and in effect for a period of 60
consecutive days; or
(7) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of the Company in an involuntary
case or proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar
-57-
law or to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by it of a petition or answer or
consent seeking reorganization or similar relief under any applicable
Federal or State law, or the consent by it to the filing of such petition
or to the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official of
the Company or of any substantial part of its property, or the making by it
of an assignment for the benefit of creditors, or the admission by it in
writing of its inability to pay its debts generally as they become due, or
the taking of corporate action by the Company in furtherance of any such
action.
SECTION 5.2. Acceleration of Maturity; Rescission and Annulment.
--------------------------------------------------
If an Event of Default (other than an Event of Default specified in
Section 5.1(6) or 5.1(7)) occurs and is continuing, then in every such case the
-------------- ------
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of all the Securities to be due
and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by the Holders), and upon any such declaration such principal
and all accrued interest thereon shall become immediately due and payable. If
an Event of Default specified in Section 5.1(6) or 5.1(7) occurs, the principal
-------------- ------
of, and accrued interest on, all the Securities shall ipso facto become
---- -----
immediately due and payable without any declaration or other Act of the Holder
or any act on the part of the Trustee.
At any time after such declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article Five provided, the Holders of a
------------
majority in principal amount of the Outstanding Securities, by written notice to
the Company and the Trustee, may rescind and annul such declaration and its
consequences if
(1) the Company has paid or deposited with the Trustee a sum sufficient
to pay
-58-
(A) all overdue interest on all Securities,
(B) the principal of and premium, if any, on any Securities which have
become due otherwise than by such declaration of acceleration and any
interest thereon at the rate borne by the Securities,
(C) to the extent permitted by applicable law, interest upon overdue
interest at a rate of __% per annum, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and its counsel;
and
(2) all Events of Default, other than the nonpayment of the principal
of, and any premium and interest on, Securities which have become due
solely by such declaration of acceleration, have been cured or waived as
provided in Section 5.13.
------------
No rescission or annulment referred to above shall affect any subsequent
default or impair any right consequent thereon.
SECTION 5.3. Collection of Indebtedness and Suits for Enforcement by Trustee.
---------------------------------------------------------------
The Company covenants that if
(1) default is made in the payment of any interest (including any
Liquidated Damages) on any Security when it becomes due and payable and
such default continues for a period of 30 days, or
(2) default is made in the payment of the principal of or premium, if
any, on any Security at the Maturity thereof,
the Company will upon demand of the Trustee pay to it, for the benefit of the
Holders of such Securities the whole
-59-
amount then due and payable on such Securities for principal and interest and
interest on any overdue principal and premium, if any, and, to the extent
permitted by applicable law, on any overdue interest, at a rate of __% per
annum, and in addition thereto, such further amount as shall be sufficient to
cover the reasonable costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel.
If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any such rights, whether for
the specific enforcement of any covenant or agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy.
SECTION 5.4. Trustee May File Proofs of Claim.
--------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or the
creditors of either, the Trustee (irrespective of whether the principal of, and
any interest on, the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company for the payment of overdue principal
or interest)
-60-
shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(1) to file and prove a claim for the whole amount of principal,
premium, if any, and interest owing and unpaid in respect of the Securities
and take such other actions, including participating as a member, voting or
otherwise, of any official committee of creditors appointed in such matter,
and to file such other papers or documents, in each of the foregoing cases,
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 its counsel) and
of the Holders of Securities allowed in such judicial proceeding, and
(2) to collect and receive any moneys or other property payable or
deliverable on any such claim and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities 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
Holders of Securities to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and its counsel and any other amounts due the Trustee under Section
-------
6.7.
---
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a Security
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder of a Security in any such proceeding;
provided, however, that the Trustee may, on behalf of such Holders, vote for the
-------- -------
election of a trustee in bankruptcy or similar official.
-61-
SECTION 5.5. Trustee May Enforce Claims Without Possession of Securities.
-----------------------------------------------------------
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and its counsel, be for
the ratable benefit of the Holders of the Securities in respect of which
judgment has been recovered.
SECTION 5.6. Application of Money Collected.
------------------------------
Subject to Article Twelve, any money collected by the Trustee pursuant to
--------------
this Article Five shall be applied in the following order, at the date or dates
------------
fixed by the Trustee and, in case of the distribution of such money on account
of principal, premium, if any, or interest, upon presentation of the Securities
and the notation thereon of the payment if only partially paid and upon
surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 6.7;
-----------
SECOND: To the payment of the amounts then due and unpaid for principal
of, premium, if any, or interest on, the Securities in respect of which or
for the benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts due and
payable on such Securities for principal, premium, if any, and interest,
respectively; and
THIRD: Any remaining amounts shall be repaid to the Company.
SECTION 5.7. Limitation on Suits.
-------------------
-62-
No Holder of any Security shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless:
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name
as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all such
Holders.
SECTION 5.8. Unconditional Right of Holders to Receive
-----------------------------------------
Principal, Premium and Interest and to Convert.
----------------------------------------------
-63-
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of, premium, if any, and (subject to Section 3.7)
-----------
interest on such Security on the respective Stated Maturities expressed in such
Security (or, in the case of redemption or repurchase, on the Redemption Date or
Repurchase Date, as the case may be), and to convert such Security in accordance
with Article Eleven, and to institute suit for the enforcement of any such
--------------
payment and right to convert, and such rights shall not be impaired without the
consent of such Holder.
SECTION 5.9. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder of a Security has instituted any proceeding
to enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders of
Securities shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the Trustee and
such Holders shall continue as though no such proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative.
------------------------------
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities in the last paragraph of
Section 3.6, no right or remedy herein conferred upon or reserved to the Trustee
-----------
or to the Holders of Securities is intended to be exclusive of any other right
or remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not Waiver.
----------------------------
-64-
No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or any
acquiescence therein. Every right and remedy given by this Article Five or by
------------
law to the Trustee or to the Holders of Securities may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or (subject to the
limitations contained in this Indenture) by the Holders of Securities as the
case may be.
SECTION 5.12. Control by Holders of Securities.
--------------------------------
The Holders of a majority in principal amount of the Outstanding
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee, provided that
--------
(1) such direction shall not be in conflict with any rule of law or with
this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 5.13. Waiver of Past Defaults.
-----------------------
The Holders, either (a) through the written consent of not less than a
majority in principal amount of the Outstanding Securities, or (b) by the
adoption of a resolution, at a meeting of Holders of the Outstanding Securities
at which a quorum is present, by the Holders of at least a majority in principal
amount of the Outstanding Securities represented at such meeting, may on behalf
of the Holders of all the Securities waive any past default hereunder and its
consequences, except a default (1) in the payment of the principal of, premium,
if any, or interest on any Security, or (2) in respect of a covenant or
provision hereof which under Article Eight cannot be modified or amended without
-------------
the consent of the Holder of each Outstanding Security affected.
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Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
SECTION 5.14. Undertaking for Costs.
---------------------
All parties to this Indenture agree, and each Holder of any Security by
his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 5.14 shall not apply to any suit instituted by
------------
the Company, to any suit instituted by the Trustee, to any suit instituted by
any Holder, or group of Holders, holding in the aggregate more than 10% in
principal amount of the Outstanding Securities, or to any suit instituted by any
Holder of any Security for the enforcement of the payment of the principal of,
premium, if any, or interest on any Security on or after the respective Stated
Maturity or Maturities expressed in such Security (or, in the case of redemption
or repurchase, on or after the Redemption Date or Repurchase Date, as the case
may be) or for the enforcement of the right to convert any Security in
accordance with Article Eleven.
--------------
SECTION 5.15. Waiver of Stay, Usury or Extension Laws.
---------------------------------------
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, usury or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
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law and covenants that it will not hinder, delay or impede by reason of such law
the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
SECTION 6.1. Certain Duties and Responsibilities.
-----------------------------------
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture, 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 certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture; but in
the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture, but not to verify the
contents thereof.
(b) In case an Event of Default 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 man would exercise or use under the circumstances in the conduct of his
own affairs.
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(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
------
(1) this paragraph (c) shall not be construed to limit the effect of
paragraph (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of
the Holders of a majority in principal amount of the Outstanding Securities
relating to the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Indenture; and
(4) 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 hereunder, or in the exercise of any of
its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(d) Whether or not therein 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
Section.
SECTION 6.2. Notice of Defaults.
------------------
Within 90 days after the occurrence of any default hereunder as to which
the Trustee has actually received written notice, the Trustee shall give to all
Holders of Securities, in the manner provided in Section 1.6, notice of such
-----------
default, unless such default shall have been cured or waived; provided, however,
-------- -------
that, except in the case of a
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default in the payment of the principal of, premium, if any, or interest on any
Security the Trustee shall be protected in withholding such notice if and so
long as the board of directors, the executive committee or a trust committee of
directors or Responsible Officers of the Trustee in good faith determine that
the withholding of such notice is in the interest of the Holders; and provided,
--------
further, that in the case of any default of the character specified in Section
------- -------
5.1(4), no such notice to Holders of Securities shall be given until at least
------
60 days after the occurrence thereof. For the purpose of this Section, the term
"default" means any event which is, or after notice or lapse of time or both
would become, an Event of Default.
SECTION 6.3. Certain Rights of Trustee.
-------------------------
Subject to the provisions of Section 6.1:
-----------
(1) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, Officers' Certificate, other certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, coupon, other evidence of
indebtedness or other paper or document believed by it to be genuine and to
have been signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors shall be sufficiently evidenced by a
Board Resolution;
(3) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel of its selection and the advice
of such counsel or any Opinion
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of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders of Securities pursuant to this Indenture, unless such
Holders shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be incurred by it
in compliance with such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, coupon, other evidence of indebtedness or other
paper or document, but the Trustee may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney; and
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
SECTION 6.4. Not Responsible for Recitals or Issuance of Securities.
------------------------------------------------------
The recitals contained herein and in the Securities (except the Trustee's
certificates of authentication) shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture, of
the Securities or of the Common Stock issuable upon the conversion of the
Securities.
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The Trustee shall not be accountable for the use or application by the Company
of Securities or the proceeds thereof.
SECTION 6.5. May Hold Securities, Act as Trustee Under Other Indentures.
----------------------------------------------------------
The Trustee, any Authenticating Agent, any Paying Agent, any Conversion
Agent or any other agent of the Company or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Conversion Agent or such other agent.
The Trustee may become and act as trustee under other indentures under
which other securities, or certificates of interest or participation in other
securities, of the Company are outstanding in the same manner as if it were not
Trustee hereunder.
SECTION 6.6. Money Held in Trust.
-------------------
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed in writing with the Company.
SECTION 6.7. Compensation and Reimbursement.
------------------------------
The Company agrees
(1) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an
express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
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advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee (and its directors, officers, employees and
agents) for, and to hold it harmless against, any and all loss, damage,
claim, liability or expense, including taxes (other than taxes based on the
income of the Trustee), incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration
of this trust, including the reasonable costs, expenses and reasonable
attorneys' fees of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
When the Trustee incurs expenses or renders services in connection with
an Event of Default specified in Section 5.1(6) or Section 5.1(7), the expenses
-------------- --------------
(including the reasonable charges of its counsel) and the compensation for the
services are intended to constitute expenses of the administration under any
applicable Federal or State bankruptcy, insolvency or other similar law.
The Trustee shall have a lien prior to the Securities as to all property
and funds held by it hereunder for any amount owing it or any predecessor
Trustee pursuant to this Section 6.7, except with respect to funds held in trust
-----------
for the benefit of the Holders of particular Securities.
The provisions of this Section shall survive the termination of this
Indenture or the earlier resignation or removal of the Trustee.
SECTION 6.8. Corporate Trustee Required; Eligibility.
---------------------------------------
There shall at all times be a Trustee hereunder which shall be a Person
that is eligible pursuant to the Trust
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Indenture Act to act as such, having a combined capital and surplus (or for such
purposes, the combined capital and surplus of any parent holding company) of at
least U.S.$[50,000,000], subject to supervision or examination by Federal or
State authority, and in good standing. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article and a
successor shall be appointed pursuant to Section 6.9.
-----------
SECTION 6.9. Resignation and Removal; Appointment
------------------------------------
of Successor.
------------
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 6.10.
------------
(b) The Trustee may resign at any time by giving written notice thereof
to the Company. If the instrument of acceptance by a successor Trustee required
by Section 6.10 shall not have been delivered to the Trustee within 30 days
after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Securities, delivered to the
Trustee and the Company. If the instrument of acceptance by a successor Trustee
required by Section 6.10 shall not have been delivered to the Trustee within 30
------------
days after the giving of such notice of removal, the removed Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
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(d) If at any time:
(1) the Trustee shall cease to be eligible under Section 6.8 and shall
-----------
fail to resign after written request therefor by the Company or by any
Holder of a Security who has been a bona fide Holder of a Security for at
least six months, or
(2) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall
be appointed or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, or
(3) the Trustee shall fail to comply with Section 6.13 after written
request therefore by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months,
then, in any such case (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 5.14, any Holder of a Security who has been
------------
a bona fide Holder of a Security for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee and
shall comply with the applicable requirements of this Section and Section 6.10.
------------
If, within one year after such resignation, removal or incapability, or
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment in accordance
with the applicable requirements of Section 6.10, become the successor Trustee
------------
and supersede the successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders
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of Securities and accepted appointment in the manner required by this Section
and Section 6.10, any Holder of a Security who has been a bona fide Holder of a
------------
Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each removal
of the Trustee and each appointment of a successor Trustee to all Holders of
Securities in the manner provided in Section 1.6. Each notice shall include the
-----------
name of the successor Trustee and the address of its Corporate Trust Office.
SECTION 6.10. Acceptance of Appointment by Successor.
--------------------------------------
Every successor Trustee appointed hereunder shall execute, acknowledge
and deliver to the Company and to the retiring Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee; but, on the request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder. 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.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be eligible under this Article.
SECTION 6.11. Merger, Conversion, Consolidation or Succession to Business.
-----------------------------------------------------------
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any
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corporation resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation succeeding to all or substantially
all of the corporate trust business of the Trustee, shall be the successor of
the Trustee hereunder, provided such corporation shall be otherwise eligible
--------
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto. In case any Securities shall have
been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Securities so authenticated with
the same effect as if such successor Trustee had itself authenticated such
Securities.
SECTION 6.12. Authenticating Agents.
---------------------
The Trustee may, with the consent of the Company, appoint an
Authenticating Agent or Agents acceptable to the Company with respect to the
Securities which shall be authorized to act on behalf of the Trustee to
authenticate Securities issued upon exchange or substitution pursuant to this
Indenture.
Securities authenticated by an Authenticating Agent shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder, and every reference in
this Indenture to the authentication and delivery of Securities by the Trustee
or the Trustee's certificate of authentication shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be subject to acceptance
by the Company and shall at all times be a corporation organized and doing
business under the laws of the United States of America, any State thereof or
the District of Columbia, authorized under such laws to act as Authenticating
Agent and subject to supervision or examination by government or other fiscal
authority. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 6.12, such Authenticating Agent
------------
shall resign
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immediately in the manner and with the effect specified in this Section 6.12.
------------
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
--------
under this Section 6.12, without the execution or filing of any paper or any
------------
further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice
of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 6.12, the Trustee may appoint a successor Authenticat
------------
ing Agent which shall be subject to acceptance by the Company. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder, with
like effect as if originally named as an Authenticating Agent. No successor
Authenticating Agent shall be appointed unless eligible under the provisions of
this Section 6.12.
------------
The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section 6.12.
------------
If an Authenticating Agent is appointed with respect to the Securities
pursuant to this Section 6.12, the Securities may have endorsed thereon, in
------------
addition to or in lieu of the Trustee's certification of authentication, an
alternative certificate of authentication in the following form:
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This is one of the Securities referred to in the within-mentioned
Indenture.
______________________________,
as Trustee
By [Authenticating Agent],
as Authenticating Agent
By ___________________________
Authorized Signature
SECTION 6.13. Disqualification; Conflicting Interests.
---------------------------------------
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
SECTION 6.14. Preferential Collection of Claims Against Company.
-------------------------------------------------
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
ARTICLE SEVEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 7.1. Company May Consolidate, Etc., Only on Certain Terms.
----------------------------------------------------
The Company shall not consolidate with or merge into any other Person or
convey, transfer or lease all its properties and assets substantially as an
entirety to any Person, and the Company shall not permit any Person to
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consolidate with or merge into the Company or convey, transfer or lease all or
substantially all of its properties and assets to the Company, unless:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, the Person formed by such consolidation or
into which the Company is merged, or the Person which acquires by
conveyance or transfer, or which leases the properties and assets of the
Company substantially as an entirety, shall be a corporation, limited
liability company, partnership or trust, shall be organized and validly
existing under the laws of the United States of America, any State thereof
or the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal
of, premium, if any, and interest on all of the Securities as applicable,
and the performance or observance of every covenant of this Indenture on
the part of the Company to be performed or observed and shall have provided
for conversion rights in accordance with Article Eleven;
--------------
(2) immediately after giving effect to such transaction, no Event of
Default, and no event that after notice or lapse of time or both, would
become an Event of Default, shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and, if a supplemental indenture is required
in connection with such transaction, such supplemental indenture comply
with this Article and that all conditions precedent herein provided for
relating to such transaction have been complied with, together with any
documents required under Section 8.3.
-----------
SECTION 7.2. Successor Substituted.
---------------------
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Upon any consolidation of the Company with, or merger of the Company into
any other Person or any conveyance, transfer or lease of all or substantially
all the properties and assets of the Company in accordance with Section 7.1, the
-----------
successor Person formed by such consolidation or into or with which the Company
is merged or to which such conveyance, transfer or lease is made shall 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 Person
had been named as the Company herein, and thereafter, except in the case of a
lease, the predecessor Person shall be relieved of all obligations and covenants
under this Indenture and the Securities.
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES
SECTION 8.1. Supplemental Indentures Without Consent of Holders of Securities.
----------------------------------------------------------------
Without the consent of any Holders of Securities, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto for any of the
following purposes:
(1) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants and obligations of the
Company herein and in the Securities as permitted by this Indenture; or
(2) to add to the covenants of the Company for the benefit of the
Holders of Securities or to surrender any right or power herein conferred
upon the Company; or
(3) to secure the Securities; or
(4) to make provision with respect to the conversion rights of Holders
of Securities pursuant to Section 11.11; or
-------------
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(5) to comply with the requirements of the Trust Indenture Act or the
rules and regulations of the Commission thereunder in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act;
or
(6) to evidence and provide for the acceptance of appointment hereunder
by a successor Trustee; or
(7) to cure any ambiguity, to correct or supplement any provision herein
which may be inconsistent with any other provision herein or which is
otherwise defective, or to make any other provisions with respect to
matters or questions arising under this Indenture as the Company and the
Trustee may deem necessary or desirable, provided such action pursuant to
--------
this clause (7) shall not, in the judgment of the Company, adversely affect
the interests of the Holders of Securities in any material respect.
Upon Company Request, accompanied by a Board Resolution authorizing the
execution of any such supplemental indenture, and subject to and upon receipt by
the Trustee of the documents described in Section 8.3 hereof, the Trustee shall
-----------
join with the Company in the execution of any supplemental indenture authorized
or permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained.
SECTION 8.2. Supplemental Indentures with Consent of Holders of Securities.
-------------------------------------------------------------
With either (a) the written consent of the Holders of not less than a
majority in principal amount of the Outstanding Securities, by the Act of said
Holders delivered to the Company and the Trustee, or (b) by the adoption of a
resolution, at a meeting of Holders of the Outstanding Securities at which a
quorum is present, by the Holders of a majority in principal amount of the
Outstanding Securities represented at such meeting, the Company, when authorized
by a Board Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or
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eliminating any of the provisions of this Indenture or of modifying in any
manner the rights of the Holders of Securities under this Indenture; provided,
--------
however, that no such supplemental indenture shall, without the consent or
-------
affirmative vote of the Holder of each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any installment
of interest on, any Security, or reduce the principal amount or the rate of
interest payable thereon or any amount payable upon redemption or
repurchase pursuant to Article Thirteen hereof, or change the coin or
----------------
currency in which any Security or the interest or any premium thereon or
any other amount in respect thereof is payable, or impair the right to
institute suit for the enforcement of any payment in respect of any
Security on or after the Stated Maturity thereof (or, in the case of
redemption or any repurchase, on or after the Redemption Date or Repurchase
Date, as the case may be) or, except as permitted by Section 11.11,
-------------
adversely affect the right to convert any Security as provided in Article
Eleven, or modify the provisions of this Indenture with respect to the
subordination of the Securities in a manner adverse to the Holders of
Securities; or
(2) reduce the percentage in principal amount of the Outstanding
Securities the consent of whose Holders is required for any such
supplemental indenture or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences) provided for in this Indenture;
or
(3) modify any of the provisions of this Section and Section 5.13 or
------------
9.8, except to increase any percentage contained herein or therein or to
---
provide that certain other provisions of this Indenture cannot be modified
or waived without the consent of the Holder of each Outstanding Security
affected thereby; or
(4) modify the provisions of Article Thirteen in a manner materially
adverse to the Holders.
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It shall not be necessary for any Act of Holders of Securities under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
SECTION 8.3. Execution of Supplemental Indentures.
------------------------------------
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Sections 6.1 and 6.3) shall be fully protected in relying upon,
--------------------
an Opinion of Counsel stating that the execution of such supplemental indenture
is authorized or permitted by this Indenture, and that such supplemental
indenture has been duly authorized, executed and delivered by the Company and
constitutes a valid and legally binding obligation of the Company enforceable
against the Company in accordance with its terms. The Trustee may, but shall
not be obligated to, enter into any such supplemental indenture which affects
the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
SECTION 8.4. Effect of Supplemental Indentures.
---------------------------------
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
appertaining thereto shall be bound thereby.
SECTION 8.5. Reference in Securities to Supplemental Indentures.
--------------------------------------------------
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Company and the
Trustee, to
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any such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities.
SECTION 8.6. Notice of Supplemental Indentures.
---------------------------------
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of Section 8.2, the Company
-----------
shall give notice to all Holders of Securities of such fact, setting forth in
general terms the substance of such supplemental indenture, in the manner
provided in Section 1.6. Any failure of the Company to give such notice, or any
-----------
defect therein, shall not in any way impair or affect the validity of any such
supplemental indenture.
SECTION 8.7. Conformity with Trust Indenture Act.
-----------------------------------
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
ARTICLE NINE
COVENANTS
SECTION 9.1 Payment of Principal, Premium and Interest.
------------------------------------------
The Company covenants and agrees that it will duly and punctually pay the
principal of and premium, if any, and interest on the Securities in accordance
with the terms of the Securities and this Indenture. The Company will deposit
or cause to be deposited with the Trustee, no later than the opening of business
on the date of the Stated Maturity of any Security or no later than the opening
of business on the due date for any installment of interest, all payments so
due, which payments shall be in immediately available funds on the date of such
Stated Maturity or due date, as the case may be.
SECTION 9.2. Maintenance of Offices or Agencies.
----------------------------------
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The Company hereby appoints the Corporate Trust Office of the Trustee or
such other office or agency of the Trustee as its agent in the Borough of
Manhattan, The City of New York, where Securities may be presented or
surrendered for payment, where Securities may be surrendered for registration of
transfer or exchange, where Securities may be surrendered for conversion, and
where notices and demands to or upon the Company in respect of the Securities
and this Indenture may be served.
The Company may at any time and from time to time vary or terminate the
appointment of any such agent or appoint any additional agents for any or all of
such purposes; provided, however, that until all of the Securities have been
-------- -------
delivered to the Trustee for cancellation, or moneys sufficient to pay the
principal of, premium, if any, and interest on the Securities have been made
available for payment and either paid or returned to the Company pursuant to the
provisions of Section 9.3, the Company will maintain in the Borough of
-----------
Manhattan, The City of New York, an office or agency where Securities may be
presented or surrendered for payment and conversion, where Securities may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Company will give prompt written notice to the Trustee, and
notice to the Holders in accordance with Section 1.6, of the appointment or
-----------
termination of any such agents and of the location and any change in the
location of any such office or agency.
If at any time the Company shall fail to maintain any such required
office or agency, or shall fail to furnish the Trustee with the address thereof,
presentations and surrenders may be made and notices and demands may be served
on the Corporate Trust Office of the Trustee.
SECTION 9.3. Money for Security Payments To Be Held in Trust.
-----------------------------------------------
If the Company shall act as its own Paying Agent, it will, on or before
each due date of the principal of, premium, if any, or interest on any of the
Securities, segregate and hold in trust for the benefit of the Persons
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entitled thereto a sum sufficient to pay the principal, premium, if any, or
interest so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and the Company will promptly notify
the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents, it will, no
later than the opening of business on each due date of the principal of,
premium, if any, or interest on any Securities, deposit with the Trustee a sum
sufficient to pay the principal, premium, if any, or interest so becoming due,
such sum to be held for the benefit of the Persons entitled to such principal,
premium, if any, or interest, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of any failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of,
premium, if any, or interest on Securities for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any other
obligor upon the Securities) in the making of any payment of principal,
premium, if any, or interest; and
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be
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held by the Trustee upon the same trusts as those upon which such sums were held
by the Company or such Paying Agent; and, upon such payment by any Paying Agent
to the Trustee, such Paying Agent shall be released from all further liability
with respect to such money.
Anything contained herein to the contrary notwithstanding, any money held
by the Trustee or any Paying Agent in trust for the payment and discharge of the
principal of, premium, if any, or interest on any Security that remains
unclaimed for two (2) years after the date when each payment of such principal,
premium or interest has become payable shall be repaid within sixty (60) days of
such date by the Trustee to the Company as its absolute property free from
trust, and the Trustee shall thereupon be released and discharged with respect
thereto and the Holders shall look only to the Company for the payment of the
principal, premium or interest on such Security. The Trustee shall not be liable
to the Company or any Holder for interest on funds held by it for the payment
and discharge of the principal, premium or interest on any of the Securities to
any Holder. The Company shall not be liable for any interest on the sums paid
to it pursuant to this paragraph and shall not be regarded as a trustee of such
money.
SECTION 9.4. Existence.
---------
Subject to Article Seven, the Company will do or cause to be done all
-------------
things necessary to preserve and keep in full force and effect its existence,
rights (charter and statutory) and franchises; provided, however, that the
-------- -------
Company shall not be required to preserve any such right or franchise if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders.
SECTION 9.5. Maintenance of Properties.
-------------------------
The Company will cause all properties used or useful in the conduct of
its business or the business of any Subsidiary to be maintained and kept in good
condition, repair and working order and supplied with all necessary
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equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
--------
however, that nothing in this Section shall prevent the Company from
-------
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary and not disadvantageous in any
material respect to the Holders.
SECTION 9.6. Payment of Taxes and Other Claims.
---------------------------------
The Company will pay or discharge, or cause to be paid or discharged,
before the same may become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, (2) all
claims for labor, materials and supplies which, if unpaid, might by law become a
lien or charge upon the property of the Company or any Subsidiary, and (3) all
stamps and other duties, if any, which may be imposed by the United States or
any political subdivision thereof or therein in connection with the issuance,
transfer, exchange or conversion of any Securities or with respect to this
Indenture; provided, however, that, in the case of clauses (1) and (2), the
-------- -------
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim (a) if the failure to do so
will not, in the aggregate, have a material adverse impact on the Company, or
(b) if the amount, applicability or validity is being contested in good faith by
appropriate proceedings.
SECTION 9.7. Statement by Officers as to Default.
-----------------------------------
The Company shall deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate (one of the signers of which shall be the Company's principal
executive, principal financial or principal accounting officer), stating whether
or not to the best knowledge of the signers thereof the Company is in default in
the performance and
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observance of any of the terms, provisions and conditions of this Indenture
(without regard to any period of grace or requirement of notice provided
hereunder) and, if the Company shall be in default, specifying all such defaults
and the nature and status thereof of which they may have knowledge.
The Company will deliver to the Trustee, forthwith upon becoming aware of
any default in the performance or observance of any covenant, agreement or
condition contained in this Indenture, or any Event of Default, an Officers'
Certificate specifying with particularity such default or Event of Default and
further stating what action the Company has taken, is taking or proposes to take
with respect thereto.
Any notice required to be given under this Section 9.7 shall be delivered
-----------
to the Trustee at its Corporate Trust Office.
SECTION 9.8. Waiver of Certain Covenants.
---------------------------
The Company may omit in any particular instance to comply with any
covenant or conditions set forth in Sections 9.5 and 9.6, inclusive (other than
------------ ---
a covenant or condition which under Article Eight cannot be modified or amended
-------------
without the consent of the Holder of each Outstanding Security affected), if
before the time for such compliance the Holders shall, through the written
consent of, not less than a majority in principal amount of the Outstanding
Securities, either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Company
and the duties of the Trustee or any Paying or Conversion Agent in respect of
any such covenant or condition shall remain in full force and effect.
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ARTICLE TEN
REDEMPTION OF SECURITIES
SECTION 10.1. Right of Redemption.
-------------------
The Securities may be redeemed in accordance with the provisions of the
form of Securities set forth in Section 2.2.
-----------
SECTION 10.2. Applicability of Article.
------------------------
Redemption of Securities at the election of the Company or otherwise, as
permitted or required by any provision of the Securities or this Indenture,
shall be made in accordance with such provision and this Article Ten.
-----------
SECTION 10.3. Election to Redeem; Notice to Trustee.
-------------------------------------
The election of the Company to redeem any Securities shall be evidenced
by a Board Resolution. In case of any redemption at the election of the Company
of any of the Securities, the Company shall, at least 45 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee in writing of such Redemption
Date and of the principal amount of Securities to be redeemed. If the
Securities are to be redeemed pursuant to an election of the Company which is
subject to a condition specified in the form of Securities set forth in Section
-------
2.2, the Company shall furnish the Trustee with an Officers' Certificate stating
---
that the Company is entitled to effect such redemption and setting forth a
statement of facts showing that the conditions precedent to the right of the
Company so to redeem have occurred.
SECTION 10.4. Selection by Trustee of Securities To Be Redeemed.
-------------------------------------------------
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected by the Trustee within three Business
Days after it receives the notice described in Section 10.3, from the
------------
Outstanding
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Securities not previously called for redemption, by such method as the Trustee
may deem fair and appropriate.
If any Security selected for partial redemption is converted in part
before termination of the conversion right with respect to the portion of the
Security so selected, the converted portion of such Security shall be deemed (so
far as may be) to be the portion selected for redemption. Securities which have
been converted during a selection of Securities to be redeemed may be treated by
the Trustee as Outstanding for the purpose of such selection.
The Trustee shall promptly notify the Company and each Security Registrar
in writing of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount and certificate
numbers thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
SECTION 10.5. Notice of Redemption.
--------------------
Notice of redemption shall be given in the manner provided in Section 1.6
-----------
to the Holders of Securities to be redeemed not less than 30 nor more than 60
days prior to the Redemption Date, and such notice shall be irrevocable.
All notices of redemption shall identify the Securities to be redeemed
(including CUSIP numbers) and shall state:
(1) the Redemption Date,
(2) the Redemption Price, and accrued interest, if any,
(3) if less than all the Outstanding Securities are to be redeemed, the
aggregate principal amount of Securities to be redeemed,
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(4) that on the Redemption Date the Redemption Price, and accrued
interest, if any, will become due and payable upon each such Security to be
redeemed, and that interest thereon shall cease to accrue on and after said
date,
(5) the Conversion Rate, the date on which the right to convert the
Securities to be redeemed will terminate and the places where such
Securities may be surrendered for conversion, and
(6) the place or places where such Securities are to be surrendered for
payment of the Redemption Price and accrued interest, if any.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's written request, by
the Trustee in the name of and at the expense of the Company. Notice of
redemption of Securities to be redeemed at the election of the Company received
by the Trustee shall be given by the Trustee to each Paying Agent in the name of
and at the expense of the Company.
SECTION 10.6. Deposit of Redemption Price.
---------------------------
Not less than one Business Day prior to any Redemption Date, the Company
shall deposit with the Trustee (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 9.3) an amount of
-----------
money (which shall be in immediately available funds on such Redemption Date)
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Securities which
are to be redeemed on that date other than any Securities called for redemption
on that date which have been converted prior to the date of such deposit.
If any Security called for redemption is converted, any money deposited
with the Trustee or so segregated and held in trust for the redemption of such
Security shall (subject to any right of the Holder of such Security or any
Predecessor Security to receive interest as provided in the
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last paragraph of Section 3.7) be paid to the Company on Company Request or, if
-----------
then held by the Company, shall be discharged from such trust.
SECTION 10.7. Securities Payable on Redemption Date.
-------------------------------------
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall default in the payment of the Redemption Price, including accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
Security for redemption in accordance with said notice, such Security shall be
paid by the Company at the Redemption Price together with accrued and unpaid
interest to the Redemption Date; provided, however, that installments of
-------- -------
interest on Securities whose Stated Maturity is on or prior to the Redemption
Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such on the relevant Record Date according
to their terms and the provisions of Section 3.7.
-----------
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal amount of, premium, if any, and, to the
extent permitted by applicable law, accrued interest on such Security shall,
until paid, bear interest from the Redemption Date at a rate of __% per annum
and such Security shall remain convertible until the principal of such Security
(or portion thereof, as the case may be) shall have been paid or duly provided
for.
SECTION 10.8. Securities Redeemed in Part.
---------------------------
Any Security which is to be redeemed only in part shall be surrendered at
an office or agency of the Company designated for that purpose pursuant to
Section 9.2 (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 Security without service
charge, a new Security or Securities, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in
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exchange for the unredeemed portion of the principal of the Security so
surrendered.
SECTION 10.9. Conversion Arrangement on Call for Redemption.
---------------------------------------------
In connection with any redemption of the Securities, the Company may
arrange for the purchase and conversion of any Securities by an agreement with
one or more investment bankers or other purchasers (the "Purchasers") to
purchase such Securities 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
Securities. Notwithstanding anything to the contrary contained in this Article
-------
Ten, 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 second Business Day
immediately prior to the Redemption Date), any Securities 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 Ten) 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 Securities 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 Securities.
Without the Trustee's prior written consent, no arrangement between the Company
and such Purchasers for the purchase and conversion of any Securities 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
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Securities 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 ELEVEN
CONVERSION OF SECURITIES
SECTION 11.1. Conversion Privilege and Conversion Rate.
----------------------------------------
Subject to and upon compliance with the provisions of this Article, at
the option of the Holder thereof, any Security or any portion of the principal
amount thereof that is U.S.$1,000 or an integral multiple of U.S.$1,000 may be
converted into fully paid and nonassessable shares (calculated as to each
conversion to the nearest 1/100th of a share) of Common Stock of the Company at
the Conversion Rate, determined as hereinafter provided, in effect at the time
of conversion. Such conversion right shall commence upon the original issuance
of the Securities and expire at the close of business on ____________, 2005,
subject, in the case of conversion of any Global Security, to any Applicable
Procedures. In case a Security or portion thereof is called for redemption at
the election of the Company or the Holder thereof exercises his right to require
the Company to repurchase the Security, such conversion right in respect of the
Security, or portion thereof so called, shall expire at the close of business on
the Business Day immediately preceding the Redemption Date or the Repurchase
Date, as the case may be, unless the Company defaults in making the payment due
upon redemption or repurchase, as the case may be (in each case subject as
aforesaid to any Applicable Procedures with respect to any Global Security).
The rate at which shares of Common Stock shall be delivered upon
conversion (herein called the "Conversion Rate") shall be initially ________
shares of Common Stock for each U.S.$1,000 principal amount of Securities. The
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Conversion Rate shall be adjusted in certain instances as provided in this
Article Eleven.
--------------
SECTION 11.2. Exercise of Conversion Privilege.
--------------------------------
In order to exercise the conversion privilege, the Holder of any Security
to be converted shall surrender such Security, duly endorsed or assigned to the
Company or in blank, at any office or agency of the Company maintained for that
purpose pursuant to Section 9.2, accompanied by a duly signed conversion notice
-----------
substantially in the form set forth in Section 2.4 stating that the Holder
-----------
elects to convert such Security or, if less than the entire principal amount
thereof is to be converted, the portion thereof to be converted. Each Security
surrendered for conversion (in whole or in part) 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 shall (except in
the case of any Security or portion thereof which has been called for redemption
on a Redemption Date, or is to be repurchased on a Repurchase Date, with the
consequence that the conversion right of such Security would terminate between
such Regular Record Date and the close of business on such Interest Payment
Date) be accompanied by payment in New York Clearing House funds 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 such Security (or part thereof,
as the case may be) being surrendered for conversion. The interest so payable
on such Interest Payment Date with respect to any Security (or portion thereof,
if applicable) which is surrendered for conversion during the period from the
close of business on any Record Date next preceding any Interest Payment Date to
the opening of business on such Interest Payment Date and which Security has
been called for redemption on a Redemption Date, or is repurchasable on a
Repurchase Date, with the consequence that the conversion right of such Security
would terminate between such Regular Record Date and the close of business on
such Interest Payment Date, shall be paid to the Holder of such Security being
converted in an amount equal to the interest that would have been payable on
such Security if such Security had been converted as of the close of business on
such Interest Payment Date. The interest so payable on
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such Interest Payment Date in respect of any Security (or portion thereof, as
the case may be) that has not been called for redemption on a Redemption Date,
or is not eligible for repurchase on a Repurchase Date, with the consequence of
termination of the conversion right as aforesaid, which Security (or portion
thereof, as the case may be) is surrendered for conversion during the period
from the close of business on any Record Date next preceding any Interest
Payment Date to the opening of business on such Interest Payment Date, shall be
paid to the Holder of such Security as of such Regular Record Date. Interest
payable in respect of any Security surrendered for conversion on or after an
Interest Payment Date shall be paid to the Holder of such Security as of the
next preceding Regular Record Date, notwithstanding the exercise of the right of
conversion. Except as provided in this paragraph and subject to the last
paragraph of Section 3.7, no cash payment or adjustment shall be made upon any
-----------
conversion on account of any interest accrued from the Interest Payment Date
next preceding the conversion date, in respect of any Security (or part thereof,
as the case may be) surrendered for conversion, or on account of any dividends
on the Common Stock issued upon conversion. The Company's delivery to the Holder
of the number of shares of Common Stock (and cash in lieu of fractions thereof,
as provided in this Indenture) into which a Security is convertible will be
deemed to satisfy the Company's obligation to pay the principal amount of the
Security.
Securities shall be deemed to have been converted on the day of surrender
of such Securities for conversion in accordance with the foregoing provisions,
and at such time the rights of the Holders of such Securities as Holders shall
cease, and the Person or Persons entitled to receive the Common Stock issuable
upon conversion shall be treated for all purposes as the record holder or
holders of such Common Stock at such time. As promptly as practicable on or
after the conversion date, the Company shall issue and deliver to the Trustee,
for delivery to the Holder, a certificate or certificates for the number of full
shares of Common Stock issuable upon conversion, together with payment in lieu
of any fraction of a share, as provided in Section 11.3.
------------
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In the case of any Security which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and make
available for delivery to the Holder thereof, at the expense of the Company, a
new Security or Securities of authorized denominations in an aggregate principal
amount equal to the unconverted portion of the principal amount of such
Security. A Security may be converted in part, but only if the principal amount
of such Security to be converted is any integral multiple of U.S.$1,000 and the
principal amount of such security to remain Outstanding after such conversion is
equal to U.S.$1,000 or any integral multiple of U.S.$1,000 in excess thereof.
SECTION 11.3. Fractions of Shares.
-------------------
No fractional shares of Common Stock shall be issued upon conversion of
any Security or Securities. If more than one Security shall be surrendered for
conversion at one time by the same Holder, the number of full shares which shall
be issuable upon conversion thereof shall be computed on the basis of the
aggregate principal amount of the Securities (or specified portions thereof) so
surrendered. Instead of any fractional share of Common Stock which would
otherwise be issuable upon conversion of any Security or Securities (or
specified portions thereof), the Company shall calculate and pay a cash
adjustment in respect of such fraction (calculated to the nearest 1/100th of a
share) in an amount equal to the same fraction of the Closing Price Per Share at
the close of business on the day of conversion.
SECTION 11.4. Adjustment of Conversion Rate.
-----------------------------
The Conversion Rate shall be subject to adjustments from time to time as
follows:
(1) In case the Company shall pay or make a dividend or other
distribution on any class of capital stock of the Company payable in shares of
Common Stock, the Conversion Rate in effect at the opening of business on the
day following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be increased by dividing such
Conversion Rate by a fraction of which the numerator shall be the
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number of shares of Common Stock outstanding at the close of business on the
date fixed for such determination and the denominator shall be the sum of such
number of shares and the total number of shares constituting such dividend or
other distribution, such increase to become effective immediately after the
opening of business on the day following the date fixed for such determination.
If, after any such date fixed for determination, any dividend or distribution is
not in fact paid, the Conversion Rate shall be immediately readjusted, effective
as of the date the Board of Directors determines not to pay such dividend or
distribution, to the Conversion Rate that would have been in effect if such
determination date had not been fixed. For the purposes of this paragraph (1),
the number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include shares issuable in
respect of scrip certificates issued in lieu of fractions of shares of Common
Stock. The Company will not pay any dividend or make any distribution on shares
of Common Stock held in the treasury of the Company.
(2) In case the Company shall issue rights, options or warrants to all
holders of its Common Stock entitling them to subscribe for or purchase shares
of Common Stock at a price per share less than the current market price per
share (determined as provided in paragraph (8) of this Section 11.4) of the
------------
Common Stock on the date fixed for the determination of stockholders entitled to
receive such rights, options or warrants (other than any rights, options or
warrants that by their terms will also be issued to any Holder upon conversion
of a Security into shares of Common Stock without any action required by the
Company or any other Person), the Conversion Rate in effect at the opening of
business on the day following the date fixed for such determination shall be
increased by dividing such Conversion Rate by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination plus the
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number of shares of Common Stock which the aggregate of the offering price of
the total number of shares of Common Stock so offered for subscription or
purchase would purchase at such current market price and the denominator shall
be the number of shares of Common Stock outstanding at the close of business on
the date fixed for such determination plus the number of shares of Common Stock
so offered for subscription or purchase, such increase to become effective
immediately after the opening of business on the day following the date fixed
for such determination. If, after any such date fixed for determination, any
such rights, options or warrants are not in fact issued, the Conversion Rate
shall be immediately readjusted, effective as of the date the Board of Directors
determines not to issue such rights, options or warrants, to the Conversion Rate
that would have been in effect if such determination date had not been fixed.
For the purposes of this paragraph (2), the number of shares of Common Stock at
any time outstanding shall not include shares held in the treasury of the
Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of shares of Common Stock. The Company will not
issue any rights, options or warrants in respect of shares of Common Stock held
in the treasury of the Company.
(3) In case outstanding shares of Common Stock shall be subdivided into
a greater number of shares of Common Stock, the Conversion Rate in effect at the
opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately increased, and, conversely, in case
outstanding shares of Common Stock shall each be combined into a smaller number
of shares of Common Stock, the Conversion Rate in effect at the opening of
business on the day following the day upon which such combination becomes
effective shall be proportionately reduced, such increase or reduction, 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.
(4) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock evidences of its indebtedness, shares of any
class of capital stock, or other property (including cash or assets or
securities, but excluding (i) any rights, options or warrants referred to in
paragraph (2) of this Section, (ii) any dividend or distribution paid
exclusively in cash, (iii) any dividend or distribution referred to in paragraph
(1) of this Section and (iv) any merger or consolidation to which Section 11.11
-------------
applies), the Conversion Rate shall be adjusted so that the same shall equal the
rate determined by
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dividing the Conversion Rate in effect immediately prior to the close of
business on the date fixed for the determination of stockholders entitled to
receive such distribution by a fraction of which the numerator shall be the
current market price per share (determined as provided in paragraph (8) of this
Section 11.4) of the Common Stock on the date fixed for such determination less
------------
the then fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution filed with
the Trustee) of the portion of the assets, shares or evidences of indebtedness
so distributed applicable to one share of Common Stock and the denominator shall
be such current market price per share of the Common Stock, such adjustment to
become effective immediately prior to the opening of business on the day
following the date fixed for the determination of stockholders entitled to
receive such distribution. If, after any such date fixed for determination, any
such distribution is not in fact made, the Conversion Rate shall be immediately
readjusted, effective as of the date the Board of Directors determines not to
make such distribution, to the Conversion Rate that would have been in effect if
such determination date had not been fixed.
(5) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock cash (excluding any cash that is distributed
upon a merger or consolidation to which Section 11.11 applies or as part of a
-------------
distribution referred to in paragraph (4) of this Section) in an aggregate
amount that, combined together with (I) the aggregate amount of any other cash
distributions to all holders of its Common Stock made exclusively in cash within
the 12 months preceding the date of payment of such distribution and in respect
of which no adjustment pursuant to this paragraph (5) has been made and (II) the
aggregate of any cash plus the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution) of consideration payable in respect of any tender offer by the
Company or any of its subsidiaries for all or any portion of the Common Stock
concluded within the 12 months preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to paragraph (6) of
this Section 11.4 has been made (the "combined cash and tender amount")
------------
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exceeds 10% of the product of the current market price per share (determined as
provided in paragraph (8) of this Section 11.4) of the Common Stock on the date
------------
for the determination of holders of shares of Common Stock entitled to receive
such distribution times the number of shares of Common Stock outstanding on such
date (the "aggregate current market price"), then, and in each such case,
immediately after the close of business on such date for determination, the
Conversion Rate shall be adjusted so that the same shall equal the rate
determined by dividing the Conversion Rate in effect immediately prior to the
close of business on the date fixed for determination of the stockholders
entitled to receive such distribution by a fraction (i) the numerator of which
shall be equal to the current market price per share (determined as provided in
paragraph (8) of this Section) of the Common Stock on the date fixed for such
determination less an amount equal to the quotient of (x) the excess of such
combined cash and tender amount over such aggregate current market price divided
by (y) the number of shares of Common Stock outstanding on such date for
determination and (ii) the denominator of which shall be equal to the current
market price per share (determined as provided in paragraph (8) of this Section
-------
11.4) of the Common Stock on such date for determination.
----
(6) In case a tender offer made by the Company or any Subsidiary for all
or any portion of the Common Stock shall expire and such tender offer (as
amended upon the expiration thereof) shall require the payment to stockholders
(based on the acceptance (up to any maximum specified in the terms of the tender
offer) of Purchased Shares (as defined below)) of an aggregate consideration
having a fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution) that
combined together with (I) the aggregate of the cash plus the fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution), as of the expiration of such
tender offer, of consideration payable in respect of any other tender offer by
the Company or any Subsidiary for all or any portion of the Common Stock
expiring within the 12 months preceding the expiration of such tender offer and
in respect of which no adjustment pursuant to this paragraph
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(6) has been made and (II) the aggregate amount of any cash distributions to all
holders of the Company's Common Stock within 12 months preceding the expiration
of such tender offer and in respect of which no adjustment pursuant to paragraph
(5) of this Section has been made (the "combined tender and cash amount")
exceeds 10% of the product of the current market price per share of the Common
Stock (determined as provided in paragraph (8) of this Section 11.4) as of the
------------
last time (the "Expiration Time") tenders could have been made pursuant to such
tender offer (as it may be amended) times the number of shares of Common Stock
outstanding (including any tendered shares) as of the Expiration Time, then, and
in each such case, immediately prior to the opening of business on the day after
the date of the Expiration Time, the Conversion Rate shall be adjusted so that
the same shall equal the rate determined by dividing the Conversion Rate
immediately prior to close of business on the date of the Expiration Time by a
fraction (i) the numerator of which shall be equal to (A) the product of (I) the
current market price per share of the Common Stock (determined as provided in
paragraph (8) of this Section 11.4) on the date of the Expiration Time
------------
multiplied by (II) the number of shares of Common Stock outstanding (including
any tendered shares) on the Expiration Time less (B) the combined tender and
cash amount, and (ii) the denominator of which shall be equal to the product of
(A) the current market price per share of the Common Stock (determined as
provided in paragraph (8) of this Section 11.4) as of the Expiration Time
------------
multiplied by (B) the number of shares of Common Stock outstanding (including
any tendered shares) as of the Expiration Time less the number of all shares
validly tendered and not withdrawn as of the Expiration Time (the shares deemed
so accepted up to any such maximum, being referred to as the "Purchased
Shares").
(7) The reclassification of Common Stock into securities including other
than Common Stock (other than any reclassification upon a consolidation or
merger to which Section 11.11 applies) shall be deemed to involve (a) a
-------------
distribution of such securities other than Common Stock to all holders of Common
Stock (and the effective date of such reclassification shall be deemed to be
"the date fixed for the determination of stockholders entitled to receive such
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distribution" and "the date fixed for such determination" within the meaning of
paragraph (4) of this Section), and (b) a subdivision or combination, as the
case may be, of the number of shares of Common Stock outstanding immediately
prior to such reclassification into the number of shares of Common Stock
outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be "the day upon which such subdivision
becomes effective" or "the day upon which such combination becomes effective",
as the case may be, and "the day upon which such subdivision or combination
becomes effective" within the meaning of paragraph (3) of this Section 11.4).
------------
(8) For the purpose of any computation under paragraphs (2), (4), (5) or
(6) of this Section 11.4, the current market price per share of Common Stock on
------------
any date shall be calculated by the Company and be deemed to be the average of
the daily Closing Prices Per Share for the five consecutive Trading Days
selected by the Company commencing not more than 10 Trading Days before, and
ending not later than, the earlier of the day in question and the day before the
"ex" date with respect to the issuance or distribution requiring such
computation. For purposes of this paragraph, the term "'ex' date", when used
with respect to any issuance or distribution, means the first date on which the
Common Stock trades regular way in the applicable securities market or on the
applicable securities exchange without the right to receive such issuance or
distribution.
(9) No adjustment in the Conversion Rate shall be required unless such
adjustment (plus any adjustments not previously made by reason of this paragraph
(9)) would require an increase or decrease of at least one percent in such rate;
provided, however, that any adjustments which by reason of this paragraph (9)
-------- -------
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Article shall be made to
the nearest cent or to the nearest one-hundredth of a share, as the case may be.
(10) The Company may make such increases in the Conversion Rate, for the
remaining term of the Securities or any shorter term, in addition to those
required by paragraphs (1), (2), (3), (4), (5) and (6) of this Section 11.4, as
------------
it considers to be advisable in order to
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avoid or diminish any income tax liability to any holders of shares of Common
Stock resulting from any dividend or distribution of Common Stock or issuance of
rights or warrants to purchase or subscribe for Common Stock or from any event
treated as such for income tax purposes.
To the extent permitted by applicable law, the Company from time to time
may increase the Conversion Rate by any amount for any period of time if the
period is at least twenty (20) days and the Board of Directors shall have made a
determination that such increase would be in the best interests of the Company,
which determination shall be conclusive; provided, however, that such increase
-------- -------
shall not be taken into account for purposes of determining whether the Closing
Price Per Share of the Common Stock exceeds the Conversion Price by 105% in
connection with an event which would otherwise be a Change in Control. Whenever
the Conversion Rate is increased pursuant to the preceding sentence, the Company
shall give notice of the increase to the Holders of Securities in the manner
provided in Section 1.6 at least fifteen (15) days prior to the date the
increased Conversion Rate takes effect, and such notice shall state the
increased Conversion Rate and the period during which it will be in effect.
(11) Notwithstanding the foregoing provisions of this Section, no
adjustment of the Conversion Rate shall be required to be made (a) upon the
issuance of shares of Common Stock pursuant to any present or future plan for
the reinvestment of dividends or (b) because of a tender or exchange offer of
the character described in Rule 13e-4(h)(5) under the Exchange Act or any
successor rule thereto.
SECTION 11.5. Notice of Adjustments of Conversion Rate.
----------------------------------------
Whenever the Conversion Rate is adjusted as herein provided:
(1) the Company shall compute the adjusted Conversion Rate in accordance
with Section 11.4 and shall prepare a certificate signed by the Chief
------------
Financial Officer of the Company setting forth the adjusted Conversion Rate
and showing in reasonable
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detail the facts upon which such adjustment is based, and such certificate
shall promptly be filed with the Trustee and with each Conversion Agent;
and
(2) upon each such adjustment, a notice stating that the Conversion Rate
has been adjusted and setting forth the adjusted Conversion Rate shall be
required, and as soon as practicable after it is required, such notice
shall be provided by the Company to all Holders in accordance with Section
-------
1.6.
---
Neither the Trustee nor any Conversion Agent shall be under any duty or
responsibility with respect to any such certificate or the information and
calculations contained therein, except to exhibit the same to any Holder of
Securities desiring inspection thereof at its office during normal business
hours.
SECTION 11.6. Notice of Certain Corporate Action.
----------------------------------
In case:
(a) the Company shall declare a dividend (or any other distribution) on
its Common Stock payable (i) otherwise than exclusively in cash or (ii)
exclusively in cash in an amount that would require any adjustment pursuant
to Section 11.4; or
------------
(b) the Company shall authorize the granting to the holders of its Common
Stock of rights, options or warrants to subscribe for or purchase any
shares of capital stock of any class or of any other rights; or
(c) of any reclassification of the Common Stock of the Company, or of any
consolidation, merger or share exchange to which the Company is a party and
for which approval of any stockholders of the Company is required, or of
the conveyance, sale, transfer or lease of all or substantially all of the
assets of the Company; or
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(d) of the voluntary or involuntary dissolution, liquidation or winding
up of the Company;
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Securities pursuant to Section 9.2, and shall cause
-----------
to be provided to all Holders in accordance with Section 1.6, at least 20 days
-----------
(or 10 days in any case specified in clause (a) or (b) above) prior to the
applicable record or effective date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend,
distribution, rights, options or warrants, or, if a record is not to be taken,
the date as of which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights, options or warrants are to be determined or
(y) the date on which such reclassification, consolidation, merger, conveyance,
transfer, sale, lease, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such reclassification,
consolidation, merger, conveyance, transfer, sale, lease, dissolution,
liquidation or winding up. Neither the failure to give such notice or the
notice referred to in the following paragraph nor any defect therein shall
affect the legality or validity of the proceedings described in clauses (a)
through (d) of this Section 11.6. If at the time the Trustee shall not be the
------------
Conversion Agent, a copy of such notice shall also forthwith be filed by the
Company with the Trustee.
The Company shall cause to be filed at each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 9.2, and shall
-----------
cause to be provided to all Holders in accordance with Section 1.6, notice of
-----------
any tender offer by the Company or any Subsidiary for all or any portion of the
Common Stock at or about the time that such notice of tender offer is provided
to the public generally.
SECTION 11.7. Company to Reserve Common Stock.
-------------------------------
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The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock, for the
purpose of effecting the conversion of Securities, the full number of shares of
Common Stock then issuable upon the conversion of all Outstanding Securities.
SECTION 11.8. Taxes on Conversions.
--------------------
Except as provided in the next sentence, the Company will pay any and all
taxes and duties that may be payable in respect of the issue or delivery of
shares of Common Stock on conversion of Securities pursuant hereto. The Company
shall not, however, be required to pay any tax or duty which may be payable in
respect of any transfer involved in the issue and delivery of shares of Common
Stock in a name other than that of the Holder of the Security or Securities to
be converted, and no such issue or delivery shall be made unless and until the
Person requesting such issue has paid to the Company the amount of any such tax
or duty, or has established to the satisfaction of the Company that such tax or
duty has been paid.
SECTION 11.9. Covenant as to Common Stock.
---------------------------
The Company agrees that all shares of Common Stock that may be delivered
upon conversion of Securities, upon such delivery, will be newly issued shares
and will have been duly authorized and validly issued and will be fully paid and
nonassessable and, except as provided in Section 11.8, the Company will pay all
------------
taxes, liens and charges with respect to the issue thereof.
SECTION 11.10. Cancellation of Converted Securities.
------------------------------------
All Securities delivered for conversion shall be delivered to the Trustee
or its agent to be canceled by or at the direction of the Trustee, which shall
dispose of the same as provided in Section 3.9.
-----------
SECTION 11.11. Provision in Case of Consolidation, Merger or Sale of
-----------------------------------------------------
Assets.
------
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In case of any consolidation or merger of the Company with or into any
other Person, any merger of another Person with or into the Company (other than
a merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock of the Company) or any
conveyance, sale, transfer or lease of all or substantially all of the assets of
the Company, the Person formed by such consolidation or resulting from such
merger or which acquires such assets, as the case may be, shall execute and
deliver to the Trustee a supplemental indenture providing that the Holder of
each Security then Outstanding shall have the right thereafter, during the
period such Security shall be convertible as specified in Section 11.1, to
------------
convert such Security only into the kind and amount of securities, cash and
other property receivable upon such consolidation, merger, conveyance, sale,
transfer or lease by a holder of the number of shares of Common Stock of the
Company into which such Security might have been converted immediately prior to
such consolidation, merger, conveyance, sale, transfer or lease, assuming such
holder of Common Stock of the Company (i) is not a Person with which the Company
consolidated or merged with or into or which merged into or with the Company or
to which such conveyance, sale, transfer or lease was made, as the case may be
("Constituent Person"), or an Affiliate of a Constituent Person and (ii) failed
to exercise his rights of election, if any, as to the kind or amount of
securities, cash and other property receivable upon such consolidation, merger,
conveyance, sale, transfer or lease (provided that if the kind or amount of
--------
securities, cash and other property receivable upon such consolidation, merger,
conveyance, sale, transfer, or lease is not the same for each share of Common
Stock of the Company held immediately prior to such consolidation, merger,
conveyance, sale, transfer or lease by others than a Constituent Person or an
Affiliate thereof and in respect of which such rights of election shall not have
been exercised ("Non-electing Share"), then for the purpose of this Section
-------
11.11 the kind and amount of securities, cash and other property receivable upon
-----
such consolidation, merger, conveyance, sale, transfer or lease by the holders
of each Non-electing Share shall be deemed to be the kind and amount so
receivable per share by a plurality of the Non-electing Shares). Such
supplemental indenture shall provide for adjustments which, for events
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subsequent to the effective date of such supplemental indenture, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Article. The above provisions of this Section 11.11 shall similarly apply to
-------------
successive consolidations, mergers, conveyances, sales, transfers or leases.
Notice of the execution of such a supplemental indenture shall be given by the
Company to the Holder of each Security as provided in Section 1.6 promptly upon
-----------
such execution.
Neither the Trustee nor any Conversion Agent shall be under any
responsibility to determine the correctness of any provisions contained in any
such supplemental indenture relating either to the kind or amount of shares of
stock or other securities or property or cash receivable by Holders of
Securities upon the conversion of their Securities after any such consolidation,
merger, conveyance, transfer, sale or lease or to any such adjustment, but may
accept as conclusive evidence of the correctness of any such provisions, and
shall be protected in relying upon, an Officers Certificate or an Opinion of
Counsel with respect thereto, which the Company shall cause to be furnished to
the Trustee upon request.
SECTION 11.12. Responsibility of Trustee for Conversion Provisions.
---------------------------------------------------
The Trustee, subject to the provisions of Section 6.1, and any Conversion
-----------
Agent shall not at any time be under any duty or responsibility to any Holder of
Securities to determine whether any facts exist which may require any adjustment
of the Conversion Rate, or with respect to the nature or extent 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, or
whether a supplemental indenture need be entered into. Neither the Trustee,
subject to the provisions of Section 6.1, nor any Conversion Agent shall be
-----------
accountable with respect to the validity or value (or the kind or amount) of any
Common Stock, or of any other securities or property or cash, which may at any
time be issued or delivered upon the conversion of any Security; and it or they
do not make any representation with respect thereto. Neither the Trustee,
subject to the provisions of
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Section 6.1, nor any Conversion Agent shall be responsible for any failure of
-----------
the Company to make or calculate any cash payment or to issue, transfer or
deliver any shares of Common Stock or share certificates or other securities or
property or cash upon the surrender of any Security for the purpose of
conversion; and the Trustee, subject to the provisions of Section 6.1, and any
-----------
Conversion Agent shall not be responsible for any failure of the Company to
comply with any of the covenants of the Company contained in this Article.
ARTICLE TWELVE
SUBORDINATION OF SECURITIES
SECTION 12.1. Securities Subordinate to Senior Debt.
-------------------------------------
The Company covenants and agrees, and each Holder of a Security, by his
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article (subject to the provisions of
Article Four), the indebtedness represented by the Securities and the payment of
the principal of (and premium, if any) and interest on, and any payment of the
Repurchase Price with respect to, each and all of the Securities are hereby
expressly made subordinate and subject in right of payment to the prior payment
in full of all Senior Debt.
SECTION 12.2. No Payments in Certain Circumstances; Payment Over of Proceeds
--------------------------------------------------------------
Upon Dissolution, Etc.
----------------------
No payment on account of principal of, premium, if any, or interest on,
or redemption or repurchase of, the Securities or any coupons appertaining
thereto shall be made if, at the time of such payment or immediately after
giving effect thereto: (i) a default in the payment of principal, premium, if
any, or interest or other amounts due on any Senior Debt, including any default
under any redemption or repurchase obligation, 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 or lease
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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 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 Person who may give it pursuant to Sections 12.5 and 12.6 hereof.
------------- ----
Notwithstanding the foregoing, the Company may make, and the Trustee may receive
and shall apply, any payment in respect of the Securities (for principal,
premium, if any, or interest or repurchase) if such payment was made prior to
the occurrence of any of the contingencies specified in clauses (i) and (ii)
above.
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 effectiveness of the immediately prior Payment Blockage
Notice, and (B) all scheduled payments of principal, premium, if any, and
interest on the Securities 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 Securities upon the earlier of: (i) the date upon which the default is
cured or waived, or (ii) in the case of a default referred to in clause (ii) of
the second preceding paragraph, 179 days pass after notice is received if the
maturity of such Designated Senior Debt has not been accelerated, unless this
Article otherwise prohibits the payment or distribution at the time of such
payment or distribution.
Upon (i) any acceleration of the principal amount due on the Securities
or (ii) any payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to creditors upon any
dissolution, winding up or total or partial liquidation or reorganization of the
Company, whether voluntary or
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involuntary, or in bankruptcy, insolvency, receivership or other proceedings,
all principal of, premium, if any, sinking fund and interest or other amounts
due or to become due upon all Senior Debt shall first be paid in full, or
payment thereof provided for in money or money's worth in accordance with its
terms, before any payment is made on account of the principal of, premium, if
any, or interest on, or repurchase of, the indebtedness evidenced by the
Securities or any coupon appertaining thereto, and upon any such dissolution or
winding up or liquidation or reorganization any payment or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities, to which the Holders of the Securities or any coupons appertaining
thereto or the Trustee under this Indenture would be entitled, except for the
provisions hereof, shall be paid by the Company or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, or by the Holders of the Securities or any coupons appertaining
thereto or by the Trustee under this Indenture if received by them or it, as the
case may be, directly to the holders of Senior Debt (pro rata to each such
holder on the basis of the respective amounts of Senior Debt held by such
holder) or their representatives, to the extent necessary to pay all Senior Debt
in full, in money or money's worth, after giving effect to any concurrent
payment or distribution to or for the holders of Senior Debt, before any payment
or distribution is made to the Holders of the Securities or any coupons
appertaining thereto or to the Trustee under this Indenture.
In the event that, contrary to the foregoing, any payment or distribution
of assets of the Company of any kind or character, whether in cash, property or
securities, shall be received by the Trustee or the Holders of the Securities
before all Senior Debt is paid in full or provision made for such payment, in
accordance with its terms, such payment or distribution shall be paid over or
delivered to, the holders of such Senior Debt or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any of such Senior Debt have been issued, as
their respective interests may appear, for application to the payment of all
Senior Debt remaining unpaid to the extent necessary to pay
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all such Senior Debt in full in accordance with its terms, after giving effect
to any concurrent payment or distribution to or for the holders of such Senior
Debt.
Subject to the payment in full of all Senior Debt, the Holders of the
Securities and any coupons (together with the holders of any other indebtedness
of the Company which is subordinated in right of payment to the payment in full
of all Senior Debt, which is not subordinated in right of payment to the
Securities and which by its terms grants such right of subrogation to the
holders thereof) shall be subrogated to the rights of the holders of Senior Debt
to receive payments or distribution of assets of the Company made on the Senior
Debt until the principal of, premium, if any, and interest on, or amounts
payable upon repurchase of, the Securities shall be paid in full; and, for the
purposes of such subrogation, no payments or distributions to the holders of
Senior Debt of any cash, property or securities to which the Holders of the
Securities and any coupons appertaining thereto or the Trustee would be entitled
except for the provisions of this Article, and no payment over pursuant to the
provisions of this Article to the holders of Senior Debt by the Holders of the
Securities or any coupon or the Trustee, shall, as between the Company, its
creditors other than the holders of Senior Debt, and the Holders of Securities
and coupons, be deemed to be a payment by the Company to the holders of or on
account of Senior Debt, it being understood that the provisions of this Article
are and are intended solely for the purpose of defining the relative rights of
the Holders of the Securities and coupons, on the one hand, and the holders of
Senior Debt, on the other hand.
SECTION 12.3. Trustee to Effectuate Subordination.
-----------------------------------
Each Holder of a Security by his acceptance thereof authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes.
SECTION 12.4. No Waiver of Subordination Provisions.
-------------------------------------
No right of any present or future holder of any Senior Debt to enforce
subordination as herein provided
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shall at any time in any way be prejudiced or impaired by any act or failure to
act on the part of the Company or by any act or failure to act, in good faith,
by any such holder of any Senior Debt, or by any non-compliance by the Company
with the terms, provisions and covenants of this Indenture, regardless of any
knowledge thereof any such holder may have or be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders of the Securities, without
incurring responsibility to the Holders of the Securities and without impairing
or releasing the subordination provided in this Article or the obligations
hereunder of the Holders of the Securities to the holders of Senior Debt, do any
one or more of the following: (i) change the manner, place or terms of payment
or extend the time of payment of, or renew or alter, Senior Debt, or otherwise
amend or supplement in any manner Senior Debt or any instrument evidencing the
same or any agreement under which Senior Debt is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing Senior Debt; (iii) release any Person liable in any manner
for the collection of Senior Debt; and (iv) exercise or refrain from exercising
any rights against the Company and any other Person.
SECTION 12.5. Notice to Trustee.
-----------------
The Company shall give prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by the
Trustee in respect of the Securities. Notwithstanding the provisions of this
Article or any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Company or a holder of Senior Debt or from any trustee, agent or representative
therefor; and, prior to the receipt of any such written notice, the Trustee,
subject to the provisions of Section 6.1, shall be entitled in all respects to
-----------
assume
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that no such facts exist; provided, however, that if the Trustee shall not have
-------- -------
received the notice provided for in this Section 12.5 prior to the date upon
------------
which by the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of (and premium, if
any) or interest on any Security), then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such money and to apply the same to the purpose for which such money was
received and shall not be affected by any notice to the contrary which may be
received by it within two Business Days prior to such date.
Subject to the provisions of Section 6.1, the Trustee shall be entitled
-----------
to rely on the delivery to it of a written notice by a Person representing
himself to be a holder of Senior Debt (or a trustee, agent or representative
therefor) to establish that such notice has been given by a holder of Senior
Debt (or a trustee, agent or representative therefor). In the event that the
Trustee determines in good faith that further evidence is required with respect
to the right of any Person as a holder of Senior Debt to participate in any
payment or distribution pursuant to this Article, the Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Debt held by such Person, the extent to which such Person
is entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, and if such evidence
is not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
SECTION 12.6. Reliance on Judicial Order or Certificate of Liquidating Agent.
--------------------------------------------------------------
Upon any payment or distribution of assets of the Company referred to in
this Article, the Trustee, subject to the provisions of Section 6.1, and the
-----------
Holders of the Securities shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such insolvency,
bankruptcy, receivership, liquidation, reorganiza tion, dissolution, winding up
or similar case or proceeding is pending, or a certificate of the
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trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee for
the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of Securities, for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.
SECTION 12.7. Trustee Not Fiduciary for Holders of Senior Debt.
------------------------------------------------
The Trustee shall not be deemed to owe any fiduciary duty to the holders
of Senior Debt and shall not be liable to any such holders if it shall in good
faith mistakenly pay over or distribute to Holders of Securities or to the
Company or to any other Person cash, property or securities to which any holders
of Senior Debt shall be entitled by virtue of this Article or otherwise. With
respect to the holders of Senior Debt, the Trustee undertakes to perform or to
observe only such of its covenants or obligations as are specifically set forth
in this Article Twelve, and no implied covenants or obligations with respect to
--------------
holders of Senior Debt shall be read into this Indenture against the Trustee.
SECTION 12.8. Reliance by Holders of Senior Debt on Subordination Provisions.
--------------------------------------------------------------
Each Holder by accepting a Security 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 Securities, 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.
SECTION 12.9. Rights of Trustee as Holder of Senior Debt; Preservation of
-----------------------------------------------------------
Trustee's Rights.
----------------
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The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Debt that 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 6.7.
-----------
SECTION 12.10. 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 12.9 shall not apply to the Company or any Affiliate of
------- ------------
the Company if it or such Affiliate acts as Paying Agent.
SECTION 12.11. Certain Conversions and Repurchases Deemed Payment.
--------------------------------------------------
For the purposes of this Article only, (1) the issuance and delivery of
junior securities upon conversion of Securities in accordance with Article
-------
Eleven or upon the repurchase of Securities in accordance with Article Thirteen
------ ----------------
shall not be deemed to constitute a payment or distribution on account of the
principal of or premium or interest on Securities or on account of the purchase
or other acquisition of Securities, and (2) the payment, issuance or delivery of
cash, property or securities (other than junior securities) upon conversion of a
Security shall be deemed to constitute payment on account of the principal of
such Security. For the purposes of this Section, the term "junior securities"
means (a) shares of any stock of any class of the Company and any cash, property
or securities into which the Securities are convertible pursuant to Article
-------
Eleven and (b) securities of the Company which are subordinated in right of
------
payment to all Senior Debt that may
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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 Securities
are so subordinated as provided in this Article. Nothing contained in this
Article or elsewhere in this Indenture or in the Securities is intended to or
shall impair, as among the Company, its creditors other than holders of Senior
Debt and the Holders of the Securities, the right, which is absolute and
unconditional, of the Holder of any Security to convert such Security in
accordance with Article Eleven or to exchange such Security for Common Stock in
--------------
accordance with Article Thirteen if the Company elects to satisfy the
----------------
obligations under Article Thirteen by the delivery of Common Stock.
----------------
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ARTICLE THIRTEEN
REPURCHASE OF SECURITIES AT THE OPTION OF THE
HOLDER UPON A CHANGE IN CONTROL
SECTION 13.1. Right to Require Repurchase.
---------------------------
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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 13.2, to require the Company to repurchase,
------------
and upon the exercise of such right the Company shall repurchase, all of such
Holder's Securities not theretofore called for redemption, or any portion of the
principal amount thereof that is equal to U.S.$1,000 or any integral multiple of
U.S.$1,000, on the date (the "Repurchase Date") that is 60 days after the date
of the Company Notice (as defined in Section 13.3) at a purchase price equal to
------------
100% of the principal amount of the Securities to be repurchased plus interest
accrued to the Repurchase Date (the "Repurchase Price"); provided, however, that
-------- -------
installments of interest on Securities whose Stated Maturity is on or prior to
the Repurchase Date shall be payable to the Holders of such Securities, or one
or more Predecessor Securities, registered as such on the relevant Record Date
according to their terms and the provisions of Section 3.7. Such right to
-----------
require the repurchase of the Securities shall not continue after a discharge of
the Company from its obligations with respect to the Securities in accordance
with Article Four, unless a Change in Control shall have occurred prior to such
------------
discharge. 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 13.2, by delivery of shares of Common Stock having a fair market value
------------
equal to the Repurchase Price. Whenever in this Indenture (including Sections
--------
2.2, 3.1, 5.1(1) and 5.8) there is a reference, in any context, to the principal
---------------- ---
of any Security as of any time, such reference shall be deemed to include
reference to the Repurchase Price payable in respect of such Security 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 Twelve 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 13.2. 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 13.1 if and only if the following conditions
------------
shall have been satisfied:
(a) 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 13.1 and this Section 13.2, 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 Price Per Share for the
five consecutive Trading Days immediately preceding and including the third
Trading Day prior to the Repurchase Date;
(b) Payment of the Repurchase Price may not be made in Common Stock
unless such stock is, or shall have been, approved for listing on the New York
Stock Exchange or listed or quoted on a national securities exchange or
quotation system, in either case, prior to the Repurchase Date; and
(c) All shares of Common Stock that may be issued upon repurchase of
Securities 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 rights.
If all of the conditions set forth in this Section 13.2 are not satisfied
------------
in accordance with the terms thereof, the Repurchase Price shall be paid by the
Company only in cash.
SECTION 13.3. Notices; Method of Exercising Repurchase Right, Etc.
----------------------------------------------------
(a) Unless the Company shall have theretofore called for redemption all
of the Outstanding Securities, on or before the 30th day after the occurrence of
a Change in Control, the Company or, at the request and expense of the
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Company on or before the 30th day after such occurrence, the Trustee, shall give
to all Holders of Securities, in the manner provided in Section 1.6, 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 deliver a copy of such notice of a repurchase right to the Trustee.
Each notice of a repurchase right shall state:
(1) the Repurchase Date,
(2) the date by which the repurchase right must be exercised,
(3) the Repurchase Price, and whether the Repurchase Price shall be paid
by the Company in cash or by delivery of shares of Common Stock,
(4) a description of the procedure which a Holder must follow to
exercise a repurchase right, and the place or places where such Securities,
are to be surrendered for payment of the Repurchase Price and accrued
interest, if any,
(5) that on the Repurchase Date the Repurchase Price, and accrued
interest, if any, will become due and payable upon each such Security
designated by the Holder to be repurchased, and that interest thereon shall
cease to accrue on and after said date,
(6) the Conversion Rate then in effect, the date on which the right to
convert the principal amount of the Securities to be repurchased will
terminate and the place or places where such Securities may be surrendered
for conversion,
(7) the place or places that the Notice of Election of Holder to Require
Repurchase as provided in Section 2.2, shall be delivered, and the form of
-----------
such notice, and
(8) the CUSIP number or numbers of such Securities.
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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 Securities.
If any of the foregoing provisions or other provisions of this Article
-------
Thirteen are inconsistent with applicable law, such law shall govern.
--------
(b) To exercise a repurchase right, a Holder shall deliver to the
Trustee on or before the 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 Securities to be
repurchased (and, if any Security 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 Securities 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 Securities with respect to which the
repurchase right is being exercised shall continue until the close of business
on the Repurchase Date.
(c) In the event a repurchase right shall be exercised in accordance
with the terms hereof, the Company shall pay or cause to be paid to the 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
Securities as to which the purchase 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 Securities, or one or
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more Predecessor Securities, registered as such at the close of business on the
relevant Regular Record Date.
(d) If any Security (or portion thereof) surrendered for repurchase
shall not be so paid on the Repurchase Date, the principal amount of such
Security (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 __% per annum, and each Security shall remain convertible into
Common Stock until the principal of such Security (or portion thereof, as the
case may be) shall have been paid or duly provided for.
(e) Any Security that 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
Security without service charge, a new Security or Securities, containing
identical terms and conditions, each in an authorized denomination in aggregate
principal amount equal to and in exchange for the unrepurchased portion of the
principal of the Security so surrendered.
(f) 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
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on any Common Stock issued upon repurchase of any Security declared prior to the
Repurchase Date.
(g) No fractions of shares shall be issued upon repurchase of
Securities. If more than one Security 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 Securities so repurchased.
Instead of any fractional share of Common Stock that would otherwise be issuable
on the repurchase of any Security or Securities, 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.
(h) Any issuance and delivery of certificates for shares of Common Stock
on repurchase of Securities shall be made without charge to the Holder of
Securities being repur chased for such certificates or for any tax or duty in
respect of the issuance or delivery of such certificates or the securities
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
Securities 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.
(i) All Securities 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 3.9.
-----------
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SECTION 13.4. Certain Definitions.
-------------------
For purposes of this Article Thirteen,
----------------
(a) 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;
(b) a "Change in Control" shall be deemed to have occurred at the time,
after the original issuance of the Securities, of:
(i) the acquisition by any person of beneficial ownership,
directly or indirectly, through a purchase, merger or other
acquisition transaction or series of transactions, of shares
of capital stock of the Company entitling such person to
exercise 50% or more of the total voting power of all shares
of capital stock of the Company entitled to vote generally
in the elections of directors (any shares of voting stock of
which such person or group is the beneficial owner that are
not then outstanding being deemed outstanding for purposes
of calculating such percentage), other than any such
acquisition by the Company, any Subsidiary of the Company or
any employee benefit plan of the Company existing on the
date of this Indenture; or
(ii) any consolidation or merger of the Company with or into any
other person, or any merger of another person with or into
the Company (other than (a) any such transaction (x) that
does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of Common
Stock and
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(y) pursuant to which holders of Common Stock immediately
prior to such transaction have the entitlement to exercise,
directly or indirectly, 50% or more of the total voting
power of all shares of capital stock entitled to vote
generally in the election of directors of the continuing or
surviving person immediately after such transaction and (b)
any merger that 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);
or
(iii) any conveyance, transfer, sale, lease or similar disposition
of all or substantially all of the Company's assets to
another person;
provided, however, that a Change in Control shall not be deemed to have occurred
-------- -------
if the Closing Price Per Share on any five Trading Days within the period of 10
consecutive Trading Days ending immediately after the later of the date of the
Change in Control or the date of 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 prior to the date of
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 Securities in
effect on each such Trading Day;
(c) the term "Conversion Price" shall equal U.S.$1,000 divided by the
Conversion Rate; and
(d) for purposes of Section 13.4(b)(i), the term "person" shall include
------------------
any syndicate or group that would be deemed to be a "person" under Section
13(d)(3) of the Exchange Act, as in effect on the date of the original execution
of this Indenture.
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ARTICLE FOURTEEN
HOLDERS LISTS AND REPORTS
BY TRUSTEE AND COMPANY; NON-RECOURSE
SECTION 14.1. Company to Furnish Trustee Names and Addresses of Holders.
---------------------------------------------------------
The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not more than 15 days after the Regular Record Date,
a list, in such form as the Trustee may reasonably require, of the names
and addresses of the Holders of Securities as of such Regular Record Date,
and
(b) at such other times as the Trustee may reasonably request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than 15
days prior to the time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
---------
capacity as Security Registrar.
SECTION 14.2. Preservation of Information.
---------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 14.1 and the names and
------------
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 14.1 upon receipt of a new list so furnished.
------------
(b) The rights of Holders to communicate with other Holders with respect
to their rights under this Indenture or under the Securities, and the
corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
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(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made pursuant to
the Trust Indenture Act.
SECTION 14.3. No Recourse Against Others.
--------------------------
An incorporator or any past, present or future director, officer,
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Securities or this Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Holder shall waive and release all such
liability. Such waiver and release shall be part of the consideration for the
issue of the Securities.
SECTION 14.4. Reports by Trustee.
------------------
(a) The Trustee shall transmit to Holders such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto.
(b) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission and with the Company. The Company
will promptly notify the Trustee when the Securities are listed on any stock
exchange.
SECTION 14.5. Reports by Company.
------------------
The Company shall file with the Trustee and the Commission, and transmit
to Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided pursuant to such Act; provided that any such information,
--------
documents or reports required to be filed with the Commission pursuant to
Section
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13 or 15(d) of the Exchange Act shall be filed with the Trustee within 15 days
after the same is so required to be filed with the Commission.
Delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee's receipt thereof shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
_____________________
This instrument 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.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the day and year first above written.
DIGITAL ISLAND, INC.
By ____________________________
Name:
Title:
____________________________
TRUSTEE
By ___________________________
Name:
Title:
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