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EXHIBIT 4.1
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XXX XXXX CORPORATION
AND
[STATE STREET BANK AND TRUST COMPANY]
AS TRUSTEE
$____________
___% [Convertible] Senior [Debentures] [Notes]*
INDENTURE
Dated as of _____, 199_
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* Language in brackets indicates alternative language or
provisions to be supplied. As appropriate, disclosure
will be made in the relevant Prospectus Supplement as to
which alternative has been chosen or provisions added
and a copy of the final Indenture will be filed as an
Exhibit to a Form 8-K, or other appropriate periodic
report.
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CROSS-REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
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310(a)(1)......................................................... 7.10
(a)(2)......................................................... 7.10
(a)(3)......................................................... N.A.
(a)(4)......................................................... N.A.
(b)............................................................ 7.08; 7.10; 10.02
(c)............................................................ N.A.
311(a)............................................................ 7.11
(b)............................................................ 7.12
(c)............................................................ N.A.
312(a)............................................................ 2.05
(b)............................................................ 10.03
(c)............................................................ 10.03
313(a)............................................................ 7.06
(b)(1)......................................................... N.A.
(b)(2)......................................................... 7.06
(c)............................................................ 7.06; 10.02
(d)............................................................ 7.06
314(a)............................................................ 4.01; 10.02
(b)............................................................ N.A.
(c)(1)......................................................... 10.04
(c)(2)......................................................... 10.04
(c)(3)......................................................... N.A.
(d)............................................................ N.A.
(e)............................................................ 10.05
(f)............................................................ N.A.
315(a)............................................................ 7.01(b)
(b)............................................................ 7.05; 10.02
(c)............................................................ 7.01(a)
(d)............................................................ 7.01(c)
(e)............................................................ 6.11
316(a)(last sentence)............................................. 2.09
(a)(1)(A)...................................................... 6.05
(a)(1)(B)...................................................... 6.04
(a)(2)......................................................... N.A.
(b)............................................................ 6.07
317(a)(1)......................................................... 6.08
(a)(2)......................................................... 6.09
(b)............................................................ 2.04
318(a)............................................................ 10.01
N.A. means not applicable.
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*This Cross-Reference Table is not part of the Indenture.
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TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS
Section 1.01. Definitions......................................... 1
"Affiliate".................................... 1
"Agent"........................................ 1
"Board of Directors"........................... 1
"capital stock"................................ 1
"Change of Control"............................ 1
"Company"...................................... 2
"Consolidated Net Earnings".................... 2
"Default"...................................... 2
"Disqualified Stock"........................... 3
"Equity Interests"............................. 3
"Exchange Act"................................. 3
"Holder" or "Securityholder"................... 3
"Indenture".................................... 3
"Material Subsidiary".......................... 3
"Officers' Certificate"........................ 3
"Opinion of Counsel"........................... 3
"person"....................................... 3
"principal".................................... 3
"redemption date".............................. 3
"redemption price"............................. 3
"SEC".......................................... 4
"Securities"................................... 4
"subsidiary"................................... 4
"TIA".......................................... 4
"Trustee"...................................... 4
"Trust Officer"................................ 4
Section 1.02. Other Definitions................................... 4
Section 1.03. Incorporation by Reference of Trust Indenture Act... 5
Section 1.04. Rules of Construction............................... 5
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ARTICLE 2
THE SECURITIES
Section 2.01. Form and Dating................................ 6
Section 2.02. Execution and Authentication................... 6
Section 2.03. Registrar and Paying Agent..................... 7
Section 2.04. Paying Agent to Hold Money in Trust............ 7
Section 2.05. Securityholder Lists........................... 8
Section 2.06. Transfer and Exchange.......................... 8
Section 2.07. Replacement Securities......................... 8
Section 2.08. Outstanding Securities......................... 9
Section 2.09. When Treasury Securities Disregarded........... 9
Section 2.10. Temporary Securities........................... 9
Section 2.11. Cancellation................................... 10
Section 2.12. Defaulted Interest............................. 10
Section 2.13. CUSIP Number................................... 10
ARTICLE 3
REDEMPTION
Section 3.01. Notices to Trustee............................. 10
Section 3.02. Selection of Securities to be Redeemed......... 11
Section 3.03. Notice of Redemption........................... 11
Section 3.04. Effect of Notice of Redemption................. 12
Section 3.05. Deposit of Redemption Price.................... 12
Section 3.06. Securities Redeemed in Part.................... 12
[Section 3.07. Mandatory Redemption........................... 12]
ARTICLE 4
COVENANTS
Section 4.01. Payment of Securities.......................... 13
Section 4.02. SEC Reports.................................... 13
Section 4.03. Compliance Certificate......................... 14
Section 4.04. Maintenance of Office or Agency................ 15
Section 4.05. Restrictions on Dividends and Other Payments... 15
Section 4.06. Continued Existence............................ 17
Section 4.07. Taxes ......................................... 17
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Section 4.08. Maintenance of Properties........................... 17
Section 4.09. Insurance........................................... 17
Section 4.10. Investment Company Act.............................. 18
Section 4.11. Change of Control................................... 18
ARTICLE 5
SUCCESSORS
Section 5.01. When the Company May Merge, etc..................... 20
Section 5.02. Successor Corporation Substituted................... 20
Section 5.03. Purchase Option on Change of Control................ 21
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01. Events of Default................................... 21
Section 6.02. Acceleration........................................ 23
Section 6.03. Other Remedies...................................... 23
Section 6.04. Waiver of Past Defaults............................. 24
Section 6.05. Control by Majority................................. 24
Section 6.06. Limitation on Suits................................. 24
Section 6.07. Rights of Holders to Receive Payment
[and to Convert Securities]....................... 25
Section 6.08. Collection Suit by Trustee.......................... 25
Section 6.09. Trustee May File Proofs of Claim.................... 25
Section 6.10. Priorities.......................................... 25
Section 6.11. Undertaking for Costs............................... 26
ARTICLE 7
THE TRUSTEE
Section 7.01. Duties of the Trustee............................... 26
Section 7.02. Rights of the Trustee............................... 27
Section 7.03. Individual Rights of the Trustee.................... 28
Section 7.04. Trustee's Disclaimer................................ 28
Section 7.05. Notice of Defaults.................................. 28
Section 7.06. Reports by the Trustee to Holders................... 28
Section 7.07. Compensation and Indemnity.......................... 29
Section 7.08. Replacement of the Trustee.......................... 30
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Section 7.09. Successor Trustee by Merger, etc........................ 31
Section 7.10. Eligibility; Disqualification........................... 31
Section 7.11. Preferential Collection of Claims Against Company....... 31
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE
Section 8.01. Termination of Company's Obligations.................... 31
Section 8.02. Application of Trust Money.............................. 34
Section 8.03. Repayment to Company.................................... 35
Section 8.04. Reinstatement........................................... 35
ARTICLE 9
AMENDMENTS
Section 9.01. Without the Consent of Holders.......................... 35
Section 9.02. With the Consent of Holders............................. 36
Section 9.03. Compliance with the Trust Indenture Act................. 37
Section 9.04. Revocation and Effect of Consents....................... 37
Section 9.05. Notation on or Exchange of Securities................... 38
Section 9.06. The Trustee Protected................................... 38
ARTICLE 10
GENERAL PROVISIONS
Section 10.01. Trust Indenture Act Controls............................ 39
Section 10.02. Notices................................................. 39
Section 10.03. Communication by Holders with Other Holders............. 39
Section 10.04. Certificate and Opinion as to Conditions Precedent...... 39
Section 10.05. Statements Required in Certificate or Opinion........... 40
Section 10.06. Rules by Trustee and Agents............................. 40
Section 10.07. Legal Holidays; Business Days........................... 40
Section 10.08. No Recourse Against Others.............................. 41
Section 10.09. Counterparts............................................ 41
Section 10.10. Other Provisions........................................ 41
Section 10.11. Governing Law........................................... 42
Section 10.12. No Adverse Interpretation of Other Agreements........... 42
Section 10.13. Successors.............................................. 42
Section 10.14. Severability............................................ 43
Section 10.15. Table of Contents, Headings, Etc........................ 43
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ARTICLE 11
OMITTED
[ARTICLE 12
CONVERSION
Section 12.01. Conversion Privilege................................ 43
Section 12.02. Conversion Procedures............................... 44
Section 12.03. Fractional Shares................................... 44
Section 12.04. Taxes on Conversion................................. 45
Section 12.05. Company to Provide Stock............................ 45
Section 12.06. Adjustment for Change in Capital Stock.............. 45
Section 12.07. Adjustment for Rights Issue......................... 46
Section 12.08. Adjustment for Other Distributions.................. 47
Section 12.09. Adjustment for [Preferred] [Common] Stock Issue..... 48
Section 12.10. Adjustment for Convertible Stock Issue.............. 49
Section 12.10A. Special Provision Regarding Preferred Stock......... 50
Section 12.11. Current Market Price................................ 51
Section 12.12. Consideration Received.............................. 51
Section 12.13 When Adjustment May Be Deferred..................... 52
Section 12.14. When No Adjustment Required......................... 52
Section 12.15. Notice of Adjustment................................ 53
Section 12.16. Voluntary Reduction................................. 53
Section 12.17. Notice of Certain Transactions...................... 53
Section 12.18. Reorganization of Company........................... 54
Section 12.19. Company Determination Final......................... 54
Section 12.20. Trustee's Disclaimer................................ 55]
SIGNATURES .................................................... 55
EXHIBIT A (FORM OF SECURITY)............................................. A-1
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This Indenture, dated as of ________, 199_, is between Xxx
Xxxx Corporation, a Delaware corporation (the "Company"), and
[State Street Bank and Trust Company] (the "Trustee").
The Company has duly authorized the issuance of its ___%
[Convertible] Senior [Debentures] [Notes] (the "Securities") and
to provide therefor the Company has duly authorized the execution
and delivery of this Indenture. Each party agrees as follows for
the benefit of the other party and for the equal and ratable
benefit of the Holders of the Securities.
ARTICLE 1
DEFINITIONS
SECTION 1.01. DEFINITIONS.
"Affiliate" of any specified person means any other person
directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified person. For
the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlled by" and "under common
control with"), as used with respect to any person, shall mean
the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of such person,
whether through the ownership of voting securities, by agreement
or otherwise.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Board of Directors" means the Board of Directors of the
Company or any authorized committee of the Board of Directors.
"capital stock" means any and all shares, interests,
participations or other equivalents (however designated) of
corporate stock.
"Change of Control" means any of the following: (i) all or
substantially all of the Company's assets are sold as an entirety
to any person or related group of persons or the Company engages
in any merger, consolidation, sale of capital stock, sale of
beneficial ownership interests or any other transactions with any
other person or related group of persons, with the effect that
after such transactions the shareholders of the Company
immediately prior to such transactions own, directly or
indirectly, in the aggregate less than 50% of the total voting
power entitled to vote in the election (a) of directors of the
Company, if the Company is the surviving entity, or (b) of
directors, managers or trustees (1) of such other person, if the
Company is not the surviving entity, or (2) of such other person
that
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purchases all or substantially all of the Company's assets; (ii) any person or
related group of persons acquires more than 50% of the total voting power
entitled to vote for directors of the Company; or (iii) any person or related
group of persons acquires more than 50% of the total voting power entitled to
vote for directors, managers or trustees (a) of such other person surviving the
transaction or (b) of such other person that purchases all or substantially all
of the Company's assets.
"Company" means the party named as such above until a successor replaces it
in accordance with Article 5 and thereafter means the successor.
"Consolidated Net Earnings" with respect to any person means, for any
period, the aggregate of the Net Earnings of such person and its subsidiaries
for such period, on a consolidated basis, determined in accordance with
generally accepted accounting principles consistently applied; provided that the
Net Earnings of any person acquired in a pooling of interests transaction for
any period prior to the date of such acquisition shall be excluded. "Net
Earnings" of any person for any period shall mean the net earnings (loss) of
such person for such period, determined in accordance with generally accepted
accounting principles consistently applied, (i) excluding (a) extraordinary
items recognized in such period, (b) any gain (but including any loss except as
reduced to the extent aggregate gains exceed aggregate losses, with gains in
excess of losses for one period being carried forward to subsequent periods and
back to prior periods for this purpose) realized upon the sale or other
disposition (including, without limitation, dispositions pursuant to leaseback
transactions) of any real property or equipment of such person which is not sold
or otherwise disposed of in the ordinary course of business and (c) any gain
(but including any loss except as reduced to the extent aggregate gains exceed
aggregate losses, with gains in excess of losses for one period being carried
forward to subsequent periods and back to prior periods for this purpose)
realized upon the sale or other disposition of any capital stock of such person
or a subsidiary of such person except when the sale of capital stock is in
substance the sale of the assets of the person whose capital stock is being
sold, provided that, with respect to (b) and (c) above, gains from sales of
developed or undeveloped real property (including without limitation developed
residential lots) from the Company's community, conventional housing and land
development businesses will be deemed ordinary course and (ii) excluding any
write-up in the carrying value of any asset made after ______________, provided
that the application of the equity method of accounting and the translation into
United States dollars of assets or liabilities in foreign currencies in
accordance with generally accepted accounting principles shall not be deemed to
involve any such write-up.
"Default" means any event which is, or after notice or passage of time
would be, an Event of Default.
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"Disqualified Stock" means any capital stock which, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part, on or prior to the
maturity date of the Securities.
"Equity Interests" means capital stock or warrants, options or other rights
to acquire capital stock (but excluding any debt security which is convertible
into, or exchangeable for, capital stock).
"Exchange Act" means the Securities Exchange Act of 1934, as amended, or
any successor statute.
"Holder" or "Securityholder" means a person in whose name a Security is
registered in the Registrar's books.
"Indenture" means this Indenture as amended or supplemented from time to
time.
"Material Subsidiary" means (i) Xxx Xxxx Communities, Inc., (ii) Xxx Xxxx
California Corp. and (iii) any other subsidiary of the Company, if any, named
[in the final Indenture] [or] [in a supplemental indenture.]
"Officers' Certificate" means a certificate signed by two Officers, one of
whom must be the Chairman of the Board, the President, the Treasurer or an
Executive Vice President, Senior Vice President or other Vice President of the
Company.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company or the Trustee.
"person" means any individual, corporation, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"principal" of a debt security, including the Securities, means the
principal of the security plus the premium, if any, on the security.
"redemption date" when used with respect to any of the Securities to be
redeemed, means the date fixed by the Company for such redemption pursuant to
this Indenture and the Securities.
"redemption price" when used with respect to any of the Securities to be
redeemed, means the price fixed for such redemption pursuant to this Indenture
and the Securities.
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"SEC" means the Securities and Exchange Commission.
"Securities" means the Securities described above issued under this
Indenture.
"subsidiary" of any specified person means (i) a corporation a majority of
whose capital stock with voting power, under ordinary circumstances, to elect
directors is at the time, directly or indirectly, owned by such person or by
such person and a subsidiary or subsidiaries of such person or (ii) any other
person (other than a corporation) in which such person or such person and a
subsidiary or subsidiaries of such person, directly or indirectly, at the date
of determination thereof has at least majority ownership interest or over which
it exercises control.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code Sections
77aaa-77-bbbb) as in effect on the date of execution of this Indenture.
"Trustee" means the party named as such above until a successor replaces it
in accordance with the applicable provisions of this Indenture and thereafter
means the successor.
"Trust Officer" means [the Chairman of the Board, the President or] any
[other] officer or assistant officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
SECTION 1.02. OTHER DEFINITIONS.
Defined in
Term Section
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"Bankruptcy Law"....................................... 6.01
"Business Day"......................................... 10.07
["Common Stock"......................................... 12.01]
["Conversion Agent...................................... 2.03]
"Custodian"............................................ 6.01
"Event of Default"..................................... 6.01
"Indebtedness"......................................... 11.02
"Legal Holiday"........................................ 10.07
"Officer".............................................. 10.10
"Paying Agent"......................................... 2.03
["Preferred Stock"...................................... 12.01]
["Quoted Price"......................................... 12.03]
"Registrar"............................................ 2.03
"Representative"....................................... 11.02
"Restricted Payments".................................. 4.05
"United States Government Obligations"................. 8.01
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SECTION 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC;
"indenture securities" means the Securities;
"indenture security holder" means a Securityholder or Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Securities means the Company or any other obligor on the
Securities.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them.
SECTION 1.04. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined
has the meaning assigned to it in accordance with
generally accepted accounting principles as in effect at
the date hereof;
(3) references to "generally accepted
accounting principles" shall mean generally accepted
accounting principles as in effect at the date hereof;
(4) "or" is not exclusive;
(5) words in the singular include the plural, and in the
plural include the singular; and
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(6) the male, female and neuter genders include one another.
ARTICLE 2
THE SECURITIES
SECTION 2.01. FORM AND DATING.
The Securities and the Trustee's certificate of authentication relating
thereto shall be substantially in the form set forth in Exhibit A, which is part
of this Indenture, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture, provided
that the Securities may be Global Securities and as such may be issued in either
registered or bearer form. The Securities may have notations, legends or
endorsements required by law, stock exchange rule or usage. The Company shall
approve the forms of the Securities and any notation, legend or endorsement on
them. Each Security shall be dated the date of its authentication.
The terms and provisions contained in the Securities shall constitute, and
are hereby expressly made, a part of this Indenture and, to the extent
applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
SECTION 2.02. EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Securities for the Company by manual or
facsimile signature. The Company's seal shall be reproduced on the Securities.
If an Officer whose signature is on a Security no longer holds that office
at the time the Security is authenticated, the Security shall nevertheless be
valid.
A Security shall not be valid until authenticated by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Security has
been authenticated under this Indenture.
Upon a written order of the Company signed by an Officer of the Company,
the Trustee shall authenticate Securities for original issue up to $ in
aggregate principal amount. The aggregate principal amount of Securities
outstanding at any time may not exceed that amount except as provided in Section
2.07.
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The Securities shall be issuable only in registered form without coupons
and only in denominations of $1,000 or any integral multiple thereof.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Securities. An authenticating agent may authenticate Securities
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same right as an Agent to deal with the Company or
an Affiliate.
SECTION 2.03 REGISTRAR AND PAYING AGENT.
The Company shall maintain or cause to be maintained in the Borough of
Manhattan, City of New York (the "New York Office"), State of New York, and in
such other locations as it shall determine: (i) an office or agency where
securities may be presented for registration of transfer or for exchange
("Registrar"); [and] (ii) an office or agency where Securities may be presented
for payment ("Paying Agent")[; and (iii) an office or agency where Securities
may be presented for conversion ("Conversion Agent")]. The Registrar shall keep
a register of the Securities and of their transfer and exchange. The Company may
appoint one or more co-registrars[, and] one or more additional paying agents
[and one or more additional conversion agents]. The term "Paying Agent" includes
any additional paying agent[; and the term "Conversion Agent" includes any
additional conversion agent]. The Company may change any Paying Agent,
Registrar[, or] co-registrar [or Conversion Agent] without prior notice. The
Company shall notify the Trustee of the name and address of any Agent not a
party to this Indenture and shall enter into an appropriate agency agreement
with any Registrar, Paying Agent[, or] co-registrar [or Conversion Agent] not a
party to this Indenture. The agreement shall implement the provisions of this
Indenture that relate to such Agent. The Company or any of its subsidiaries may
act as Paying Agent, Registrar[, or] co-registrar [or Conversion Agent]. If the
Company fails to appoint or maintain another entity as Registrar[, or] Paying
Agent [, or Conversion Agent], the Trustee shall act as such, and the Trustee
shall initially act as such. The Trustee shall cause to be maintained the New
York Office as long as it acts as Registrar[, or] Paying Agent [or Conversion
Agent].
SECTION 2.04. PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent (other than the Trustee, who
hereby so agrees), to agree in writing that the Paying Agent will hold in trust
for the benefit of Securityholders or the Trustee all money held by the Paying
Agent for the payment of principal or interest on the Securities, and will
notify the Trustee of any default by the Company in making any such payment.
While any such default continues, the Trustee may require
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a Paying Agent to pay all money held by it to the Trustee. The Company at any
time may require a Paying Agent to pay all money held by it to the Trustee. Upon
payment over to the Trustee, the Paying Agent (if other than the Company or a
subsidiary) shall have no further liability for the money. If the Company or a
subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust
fund for the benefit of the Securityholders all money held by it as Paying
Agent.
SECTION 2.05. SECURITYHOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee on or before each interest payment date and at such other times
as the Trustee may request in writing a list in such form and as of such date as
the Trustee may reasonably require of the names and addresses of
Securityholders.
SECTION 2.06. TRANSFER AND EXCHANGE.
Where Securities are presented to the Registrar or a co-registrar with a
request to register a transfer or to exchange them for an equal principal amount
of Securities of other denominations, the Registrar shall register the transfer
or make the exchange if its requirements for such transactions are met. To
permit registrations of transfers and exchanges, the Company shall issue and the
Trustee shall authenticate Securities at the Registrar's request. No service
charge shall be made for any registration of transfer or exchange (except as
otherwise expressly permitted herein), but the Company may require payment of a
sum sufficient to cover any transfer tax or similar governmental charge payable
in connection therewith (other than any such transfer tax or similar
governmental charge payable upon exchanges pursuant to Sections 2.10, 3.06[, or]
9.05 [or 12.02]).
The Company shall not be required (i) to issue, register the transfer of or
exchange Securities during a period beginning at the opening of business 15 days
before the day of any selection of Securities for redemption under Section 3.02
and ending at the close of business on the day of selection, or (ii) to register
the transfer or exchange of any Security so selected for redemption in whole or
in part, except the unredeemed portion of any Security being redeemed in part.
SECTION 2.07. REPLACEMENT SECURITIES.
If the Holder of a Security claims that the Security has been lost,
destroyed or wrongfully taken, the Company shall issue and the Trustee shall
authenticate a replacement Security if the Trustee's requirements are met. If
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required by the Trustee or the Company as a condition of receiving a replacement
Security, the Holder must provide an indemnity bond sufficient, in the judgment
of both the Company and the Trustee, to fully protect the Company, the Trustee,
any Agent and any authenticating agent from any loss which any of them may
suffer if the Security is replaced. The Company may charge for its expenses in
replacing any Security.
Every replacement Security is an additional obligation of the Company.
SECTION 2.08. OUTSTANDING SECURITIES.
The Securities outstanding at any time are all the Securities properly
authenticated by the Trustee except for those cancelled by the Trustee, those
delivered to it for cancellation, and those described in this Section as not
outstanding.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If Securities are considered paid under Section 4.01, they cease to be
outstanding and interest on them ceases to accrue.
A Security does not cease to be outstanding because the Company or an
Affiliate of the Company holds the Security.
SECTION 2.09. WHEN TREASURY SECURITIES DISREGARDED.
In determining whether the Holders of the required principal amount of
Securities have concurred in any direction, waiver or consent, Securities owned
by the Company or an Affiliate of the Company shall be considered as though they
are not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Securities which the Trustee knows are so owned shall be so disregarded.
SECTION 2.10. TEMPORARY SECURITIES.
Until definitive Securities are ready for delivery, the Company may prepare
and the Trustee shall authenticate temporary Securities. Temporary Securities
shall be substantially in the form of definitive Securities but may have
variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Securities in exchange for temporary Securities.
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SECTION 2.11. CANCELLATION.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee and no one else shall cancel all Securities surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall dispose of cancelled Securities as the Company directs, provided that the
Trustee shall not be required to destroy such cancelled securities. The Company
may not issue new Securities to replace Securities that it has paid or that have
been delivered to the Trustee for cancellation.
SECTION 2.12. DEFAULTED INTEREST.
If the Company fails to make a payment of interest on the Securities, it
shall pay such defaulted interest plus any interest payable on the defaulted
interest in any lawful manner. It may pay such defaulted interest, plus any such
interest payable on it, to the persons who are Securityholders on a subsequent
special record date. The Company shall fix any such record date and payment
date. At least 15 days before any such record date, the Company shall mail to
Securityholders a notice that states the record date, payment date and amount of
such interest to be paid.
SECTION 2.13. CUSIP NUMBER.
The Company in issuing the Securities may use a "CUSIP" number, and if so,
such CUSIP number shall be included in notices of redemption or exchange as a
convenience to Holders; provided, however, that any such notice may state that
no representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Securities and that reliance may be placed only
on the other identification numbers printed on the Securities. The Company will
promptly notify the Trustee of any change in the CUSIP number.
ARTICLE 3
REDEMPTION
SECTION 3.01. NOTICES TO TRUSTEE.
If the Company elects to redeem Securities pursuant to the optional
redemption provisions of paragraph 5 of the Securities, it shall notify the
Trustee of the redemption date and the principal amount of Securities to be
redeemed.
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The Company shall give each notice provided for in this Section at least 60
days before the redemption date (unless a shorter notice period shall be
satisfactory to the Trustee).
SECTION 3.02. SELECTION OF SECURITIES TO BE REDEEMED.
If less than all the Securities are to be redeemed, the Trustee shall
select the Securities to be redeemed pro rata or by lot, if lawful, or if
required by another method that complies with the requirements of any exchange
on which the Securities are listed and that the Trustee considers fair and
appropriate. The Trustee shall make the selection not more than 75 days and not
less than 45 days before the redemption date from Securities outstanding not
previously called for redemption. The Trustee may select for redemption portions
of the principal of Securities that have denominations larger than $1,000.
Securities and portions of them it selects shall be in amounts of $1,000 or
integral multiples of $1,000. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption. The Trustee shall notify the Company promptly of the Securities or
portions of Securities to be called for redemption.
SECTION 3.03. NOTICE OF REDEMPTION.
Except as provided in Section 4.11, at least 30 days but not more than 60
days before a redemption date, the Company shall mail a notice of redemption to
each Holder whose Securities are to be redeemed.
The notice shall identify the Securities to be redeemed and
shall state:
(1) the redemption date;
(2) the redemption price;
(3) if any Security is being redeemed in part,
the portion of the principal amount of such Security to
be redeemed and that, after the redemption date, upon
surrender of such Security, a new Security or Securities
in principal amount equal to the unredeemed portion will
be issued;
(4) that Securities called for redemption must be surrendered
to the Paying Agent to collect the redemption price;
(5) that interest on Securities called for redemption ceases
to accrue on and after the redemption date;
(6) the paragraph of the Securities pursuant to which the
Securities are being redeemed;
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(7) the aggregate principal amount of Securities that are
being redeemed;
(8) the CUSIP number of the Securities (provided that the
disclaimer permitted by Section 2.13 may be made); [and]
(9) the name and address of the Paying Agent [and Conversion
Agent] [.][;]
[(10) that Securities called for redemption may be converted
at any time before the close of business on the redemption date;
(11) that Holders who want to convert Securities must satisfy
the requirements in paragraph 17 of the Securities; and
(12) the current conversion price.]
At the Company's request, the Trustee shall give notice of redemption in
the Company's name and at its expense.
SECTION 3.04. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed, Securities called for redemption
become due and payable on the redemption date at the price set forth in the
Security.
SECTION 3.05. DEPOSIT OF REDEMPTION PRICE.
On or before the redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money in immediately available funds sufficient
to pay the redemption price of and accrued interest on all Securities to be
redeemed on that date. The Trustee or the Paying Agent shall return to the
Company any money not required for that purpose.
SECTION 3.06. SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is redeemed in part, the Company shall
issue and the Trustee shall authenticate for the Holder at the expense of the
Company a new Security equal in principal amount to the unredeemed portion of
the Security surrendered.
[SECTION 3.07. MANDATORY REDEMPTION.
To the extent lawful, the Company shall redeem ___ percent of the [initial]
principal amount of the Securities [outstanding] as set forth in
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paragraph 5B of the Securities, which amount shall be rounded to the next
highest integral multiple of $1,000, annually on each of the dates, upon the
terms and subject to the conditions set forth in paragraph 6 of the Securities.]
ARTICLE 4
COVENANTS
SECTION 4.01. PAYMENT OF SECURITIES.
The Company shall pay the principal of and interest on the Securities on
the dates and in the manner provided in the Securities. Principal and interest
shall be considered paid on the date due if the Trustee or Paying Agent (other
than the Company or a subsidiary) holds on that date money designated for and
sufficient to pay all principal and interest then due.
To the extent lawful, the Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on (i)
overdue principal, at the rate borne by the Securities, compounded semiannually;
and (ii) overdue installments of interest (without regard to any applicable
grace period) at the same rate, compounded semiannually.
SECTION 4.02. SEC REPORTS.
The Company shall deliver to the Trustee, within 15 days after it files
them with the SEC, copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) which the Company is required
to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act. The
Company also shall comply with the other provisions of TIA Section 314(a). The
Company shall timely comply with its reporting and filing obligations under the
applicable federal securities law.
If the Company is at any time not required to file annual or quarterly
reports pursuant to Section 13 or 15(d) of the Exchange Act, the Company will
file with the Trustee, within 15 days after the last date on which it would have
been required to make such a filing with the SEC, and will upon request of a
Holder mail to that Holder (as soon as practical after receipt of such request)
at his or her address as it appears on the register of Securities kept by the
Registrar, audited annual financial statements prepared in accordance with
generally accepted accounting principles and unaudited quarterly financial
statements. Such financial statements shall be accompanied by a Management's
Discussion and Analysis of Financial Condition and Results of Operations of the
Company for the period reported upon in substantially the form required under
the rules and regulations of the SEC, or any successor
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form of similar disclosure then required under the rules and regulations of the
SEC.
SECTION 4.03. COMPLIANCE CERTIFICATE.
The Company shall deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company, an Officers' Certificate, one of the
signatories to which shall be the principal executive officer, principal
financial officer or principal accounting officer of the Company, stating that a
review of the activities of the Company and its subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Company has fully performed its
obligations under this Indenture and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in
this Indenture and is not in default in the performance or observance of any of
the terms and conditions hereof (or, if a Default or Events of Default shall
have occurred, describing all such Defaults or Events of Default of which he or
she may have knowledge) and that to the best of his or her knowledge no event
has occurred and remains in existence by reason of which payments on account of
the principal of or interest, if any, on the Securities are prohibited.
The Company will, so long as any of the Securities are outstanding, deliver
to the Trustee, forthwith upon becoming aware of (i) any Default, Event of
Default or default in the performance of any term or condition in this Indenture
or (ii) any event of default under any other mortgage, indenture or instrument
as that term is used in Section 6.01(4), an Officers' Certificate specifying
such Default, Event of Default or default.
So long as not contrary to the then current recommendations of the American
Institute of Certified Public Accountants, at the time the Officers' Certificate
described in the second preceding paragraph is filed, the Company also will file
with the Trustee a letter or statement of the independent accountants who shall
have certified the financial statements of the Company for its preceding fiscal
year in connection with the annual report of the Company to its stockholders for
such year to the effect that, in making the examination necessary for
certification of such financial statements, nothing came to their attention that
would lead them to believe that the Company has violated any of the terms or
conditions contained in this Indenture, which Default remains uncured at the
date of such letter or statement or, if they shall have obtained knowledge of
any such uncured Default, specifying in such letter or statement such Default or
Defaults and the nature thereof, it being understood that such accountants shall
not be liable directly or indirectly for failure to obtain knowledge of any such
Default or Defaults and that their examination was not directed primarily toward
obtaining knowledge of such noncompliance.
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SECTION 4.04. MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain or cause to be maintained in the
City of New York an office or agency where Securities may be
presented or surrendered for payment, 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 of the location, and
any change in the location, of such office or agency not
maintained by the Trustee. If at any time the Company shall fail
to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 10.10.
The Company may also from time to time designate one or more
other offices or agencies where the Securities may be presented
or surrendered for any or all such purposes and may from time to
time rescind such designation; provided, however, that no such
designation or rescission shall in any manner relieve the Company
of its obligation to maintain or cause to be maintained an office
or agency in the City of New York for such purpose.
SECTION 4.05. RESTRICTIONS ON DIVIDENDS AND OTHER PAYMENTS.
The Company shall not, directly or indirectly:
(1) declare or pay any dividend on, or make any
distribution to the holders (as such) of, any shares of
its capital stock (other than dividends or distributions
payable in Equity Interests (other than Disqualified
Stock) of the Company);
(2) purchase, redeem or otherwise acquire or
retire for value any Equity Interests of the Company
(other than any such Equity Interests owned by any
subsidiary); or
(3) permit any subsidiary to purchase, redeem
or otherwise retire for value any Equity Interests of
the Company (other than any such Equity Interests owned
by any subsidiary) (such dividends, distributions,
purchases, redemptions or other acquisitions or
retirements referred to in clauses (1), (2) or (3) being
collectively referred to as "Restricted Payments"), if
at the time of such Restricted Payment:
(i) a Default or an Event of Default shall have
occurred and be continuing, or would occur as a consequence
thereof, or
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(ii) if, upon giving effect to such Restricted
Payment, the aggregate amount expended (determined as set
forth below) for all such Restricted Payments subsequent to
the date hereof, shall exceed the sum of:
(a) a percentage of the aggregate
Consolidated Net Earnings of the Company (or, in the
case such aggregate shall be a loss, 100% of such
loss) accrued during fiscal quarters ending
subsequent to a specified date, which percentage and
date will be set forth in a supplemental indenture;
(b) the aggregate net proceeds, including
cash, the fair market value of property other than
cash (as determined by the Board of Directors as
evidenced by a Board resolution) and the amount of
any Indebtedness (including principal, premium and
interest), received by the Company from or in
exchange for the issue or sale (other than to a
subsidiary), subsequent to the date hereof, of
capital stock of the Company (other than Disqualified
Stock), other than in connection with the exchange of
the Securities;
(c) the amount expended for the purchase,
redemption or other acquisition or retirement for
value of any preferred stock of the Company; and
(d) [$_________] [or] [the amount set forth
in a supplemental indenture].
For purposes of any calculation pursuant to the preceding sentence which is
required to be made within 60 days after the declaration of a dividend by the
Company, such dividend shall be deemed to be paid at the date of declaration,
and the subsequent payment of such dividend during such 60-day period shall not
be treated as an additional Restricted Payment. For purposes of determining
under clause (ii) above the amount expended for Restricted Payments, cash
distributed shall be valued at the face amount thereof and property other than
cash shall be valued at its fair market value as determined by the Board of
Directors as evidenced by a Board resolution.
Notwithstanding the foregoing, the provisions of this Section 4.05 will not
prevent: (i) the purchase of Securities by the Company; (ii) the payment of any
dividend within 60 days after the date of declaration when the payment complied
with the foregoing provisions on the date of declaration; (iii) the purchase,
redemption or any acquisition or retirement for value of
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the Preferred Stock; (iv) the retirement of any shares of the Company's capital
stock by exchange for, or out of the proceeds of the substantially concurrent
sale (other than to a subsidiary) of, other shares of its capital stock (other
than any Disqualified Stock), and neither such retirement nor the proceeds of
any such sale or exchange, to the extent used for such retirement, shall be
included in any computation made under this Section 4.05; and (v) the purchase
at a price of not more than $.05 per right of any rights issued or issuable
pursuant to any future rights plan of the Company.
SECTION 4.06. CONTINUED EXISTENCE.
Subject to Article 5, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence as a
corporation and will refrain from taking any action that would cause its
existence as a corporation to cease, including without limitation any action
that would result in its liquidation, winding up or dissolution.
SECTION 4.07. TAXES.
The Company shall, and shall cause each of its Material Subsidiaries to,
pay prior to delinquency all taxes, assessments and governmental levies, except
as contested in good faith and by appropriate proceedings or where the failure
to do so would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
SECTION 4.08. MAINTENANCE OF PROPERTIES.
The Company shall, and shall cause each of its subsidiaries to, take
reasonable action to maintain in appropriate condition each of its principal
properties which in the judgment of management is essential to the business
operations of the Company and its subsidiaries, taken as a whole, and the loss
of which would have a material adverse effect on the financial condition of the
Company and its subsidiaries, taken as a whole. Nothing contained in this
Section 4.08 shall prevent or restrict the sale, abandonment or other
disposition of any property which management shall deem advisable.
SECTION 4.09. INSURANCE.
The Company shall, and shall cause each of its subsidiaries to, take
reasonable action to maintain insurance, with financially sound and reputable
insurers, to the extent and against such hazards as may be deemed appropriate by
management (giving effect to self-insurance), on each of its principal
properties the loss of which, in the judgment of management, would have a
material adverse effect on the financial condition of the Company and its
subsidiaries, taken as a whole.
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SECTION 4.10. INVESTMENT COMPANY ACT.
The Company shall not become an investment company subject to
registration under the Investment Company Act of 1940, as amended.
SECTION 4.11. CHANGE OF CONTROL.
Following the occurrence of any Change of Control, the Company shall
offer (a "Change of Control Offer") to purchase all outstanding Securities at a
purchase price equal to [101%] of the aggregate principal amount of the
Securities, plus accrued and unpaid interest to the date of purchase. The Change
of Control Offer shall be deemed to have commenced upon mailing of the notice
described in the next succeeding paragraph and shall terminate 20 Business Days
after its commencement, unless a longer offering period is required by law.
Promptly after the termination of the Change of Control Offer (the "Change of
Control Payment Date"), the Company shall purchase and mail or deliver payment
for all Securities tendered in response to the Change of Control Offer. If the
Change of Control Payment Date is on or after an interest payment record date
and on or before the related interest payment date, any accrued interest will be
paid to the person in whose name a Security is registered at the close of
business on such record date, and no additional interest will be payable to
Holders who tender Securities pursuant to the Change of Control Offer.
Within 30 days after any Change of Control, the Company (with notice to
the Trustee), or the Trustee upon reasonable notice and at the Company's request
(and at the expense of the Company), will mail or cause to be mailed to all
Holders on the date of the Change of Control a notice of the occurrence of such
Change of Control and of the Holders' rights arising as a result thereof. Such
notice will contain all instructions and materials necessary to enable Holders
to tender their Securities to the Company. Such notice, which shall govern the
terms of the Change of Control Offer, shall state:
(1) that the Change of Control Offer is being made pursuant to
this Section 4.11 and the length of time the Change of Control Offer
will remain open;
(2) the purchase price and the Change of Control Payment
Date;
(3) that any Security not tendered will continue to accrue
interest;
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(4) that any Security accepted for payment pursuant to the
Change of Control Offer shall cease to accrue interest on the Change of
Control Payment Date;
(5) that any Security accepted for payment pursuant to any
Change of Control Offer will be required to surrender the Security,
with the form entitled "Option of Holder to Elect Purchase" on the
reverse of the Security completed, to the Company, a depositary, if
appointed by the Company, or a Paying Agent at the address specified in
the notice prior to termination of the Change of Control Offer;
(6) that Holders will be entitled to withdraw their election
if the Company, depositary or Paying Agent, as the case may be,
receives, not later than the expiration of the Change of Control Offer,
or such longer period as may be required by law, a facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Security the Holder delivered for purchase and
a statement that such Holder is withdrawing his or her election to have
the Security purchased; and
(7) that Holders whose Securities are purchased only in part
will be issued Securities equal in principal amount to the unpurchased
portion of the Securities surrendered.
On or before a Change of Control Payment Date, the Company shall, to the
extent lawful, (i) if the Company appoints a depositary or Paying Agent, deposit
with such depositary or Paying Agent money sufficient to pay the purchase price
of all Securities tendered, (ii) deliver or cause the depositary or Paying Agent
to deliver to the Trustee Securities so tendered and (iii) deliver an Officers'
Certificate identifying the Securities accepted for payment by the Company in
accordance with the terms of this Section 4.11. The depositary, the Paying Agent
or the Company, as the case may be, shall promptly mail or deliver to each
tendering Holder an amount equal to the purchase price of the Securities
tendered by such Holder and accepted by the Company for purchase. The Company
will publicly announce the results of the Change of Control Offer on the Change
of Control Payment Date. Any Change of Control Offer will be conducted in
compliance with applicable tender offer rules, including Section 14(e) of the
Exchange Act and Rule 14e-1 thereunder.*
----------
* Additional substantive covenants may be added.
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ARTICLE 5
SUCCESSORS
SECTION 5.01. WHEN THE COMPANY MAY MERGE, ETC.
The Company shall not consolidate or merge with or into, or sell, lease,
convey or otherwise dispose of all or substantially all of its assets to, any
person unless:
(1) the corporation formed by or surviving any such
consolidation or merger (if other than the Company), or to which such
sale, lease, conveyance or other disposition shall have been made, is a
corporation organized and existing under the laws of the United States,
any state thereof or the District of Columbia;
(2) the corporation formed by or surviving any such
consolidation or merger (if other than the Company), or to which such
sale, lease, conveyance or other disposition shall have been made,
assumes by supplemental indenture all the obligations of the Company
under the Securities and this Indenture; and
(3) immediately after the transaction no Default or Event of
Default exists.
The Company shall deliver to the Trustee prior to the consummation of
the proposed transaction an Officers' Certificate to the foregoing effect and an
Opinion of Counsel stating that the proposed transaction and such supplemental
indenture comply with this Indenture.
SECTION 5.02. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger, or any sale, lease, conveyance or
other disposition of all or substantially all of the assets of the Company in
accordance with Section 5.01, the successor entity formed by such consolidation
or into or with which the Company is merged or to which such sale, lease,
conveyance or other disposition 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 entity had been named as the Company
herein; provided, however, that the predecessor Company in the case of a sale,
lease, conveyance or other disposition shall not be released from the obligation
to pay the principal of and interest on the Securities.
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SECTION 5.03. PURCHASE OPTION ON CHANGE OF CONTROL.
This Article 5 does not affect the obligations of the Company (including
without limitation any successor to the Company) under this Indenture.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT.
An "Event of Default" with respect to any Securities occurs if:
(1) the Company defaults in the payment of interest on any
Security when the same becomes due and payable and the Default
continues for a period of 30 days;
(2) the Company defaults in the payment of the principal of
and premium, if any, on any Security when the same becomes due and
payable at maturity, upon redemption or otherwise;
(3) the Company fails to comply with any of its other
agreements or covenants in, or provisions of, the Securities or this
Indenture and the Default continues for the period and after the notice
specified below;
(4) an event of default occurs under any mortgage, indenture
or instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the Company
or any Material Subsidiary (or the payment of which is guaranteed by
the Company or a Material Subsidiary), whether such Indebtedness or
guarantee now exists or shall be created hereafter, other than
Indebtedness which is or will be non-recourse to the Company or a
Material Subsidiary, if (a) either (i) such event of default results
from the failure to pay any such Indebtedness at maturity or (ii) as a
result of such event of default the maturity of such Indebtedness has
been accelerated prior to its expressed maturity and (b) the principal
amount of such Indebtedness, together with the principal amount of any
other such Indebtedness in default for failure to pay principal at
maturity or the maturity of which has been so accelerated, aggregates
[$_______] [the amount set forth in a supplemental indenture] or more;
provided, however, that if such event of default shall be remedied,
cured or waived, then the Event of Default hereunder by reason of such
event of default shall be
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deemed likewise to have been remedied, cured or waived without further
action by the Trustee or any of the Securityholders; or
(5) a final judgment or final judgments for the payment of
money are entered by a court or courts of competent jurisdiction
against the Company or any Material Subsidiary which remains
undischarged for a period (during which execution shall not be
effectively stayed) of 60 days, provided that the aggregate of all such
judgments exceeds [$__________] [the amount set forth in a supplemental
indenture];
(6) the Company or any Material Subsidiary pursuant to or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief
against it in an involuntary case,
(C) consents to the appointment of a Custodian of it
or for all or substantially all of its property,
(D) makes a general assignment for the benefit of its
creditors, or
(E) generally is unable to pay its debts as the same
become due;
(7) a court of competent jurisdiction enters a judgment, order
or decree under any Bankruptcy Law that:
(A) is for relief against the Company or any Material
Subsidiary in an involuntary case,
(B) appoints a Custodian of the Company or any
Material Subsidiary or for all or substantially all of their
respective properties, or
(C) orders the liquidation of the Company or any
Material Subsidiary,
and the order or decree remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means title 11, U.S. Code or any similar
federal or state law for the relief of debtors. The term "Custodian" means
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any receiver, trustee, assignee, liquidator or similar official under any
Bankruptcy Law.
A Default under clause (3) (other than Defaults under Section 4.05,
4.06 [, or] 5.01 [or, with respect to the right to convert Securities, Article
XII], which Defaults shall be Events of Default with the notice but without the
passage of time specified in this paragraph), (4) or (5) is not an Event of
Default until the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Securities notify the Company of the Default and the
Company does not cure the Default within 60 days after receipt of the notice.
The notice must specify the Default, demand that it be remedied and state that
the notice is a "Notice of Default."
SECTION 6.02. ACCELERATION.
If an Event of Default (other than an Event of Default specified in clauses (6)
and (7) of Section 6.01) occurs and is continuing, the Trustee by notice to the
Company, or the Holders of at least 25% in principal amount of the then
outstanding Securities by notice to the Company and the Trustee, may declare the
unpaid principal of and accrued interest on all the Securities to be due and
payable. Upon such declaration the principal and interest shall be due and
payable immediately. If an Event of Default specified in clause (6) or (7) of
Section 6.01 occurs, such an amount shall ipso facto become and be immediately
due and payable without any declaration or other act on the part of the Trustee
or any Holder. The Holders of a majority in principal amount of the then
outstanding Securities by notice to the Trustee may rescind an acceleration and
its consequences, except nonpayment of principal or interest on the Securities,
if the rescission would not conflict with any judgment or decree.
SECTION 6.03. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy by proceeding at law or in equity to collect the payment of
principal of or interest on the Securities or to enforce the performance of any
provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
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SECTION 6.04. WAIVER OF PAST DEFAULTS.
The Holders of a majority in principal amount of the then outstanding
Securities by notice to the Trustee may waive an existing Default or Event of
Default and its consequences except a continuing Default or Event of Default in
the payment of the principal of or interest on any Security. When a Default is
waived, it is cured and stops continuing.
SECTION 6.05. CONTROL BY MAJORITY.
The Holders of a majority in principal amount of the then outstanding
Securities may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture, is unduly prejudicial to the rights of
other Securityholders or would involve the Trustee in personal liability.
SECTION 6.06. LIMITATION ON SUITS.
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
(1) the Holder gives to the Trustee notice of a continuing
Event of Default;
(2) the Holders of at least 25% in principal amount of the
then outstanding Securities make a request to the Trustee to pursue the
remedy;
(3) such Holder or Holders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60
days after receipt of the request and the offer of indemnity; and
(5) during such 60-day period the Holders of a majority in
principal amount of the then outstanding Securities do not give the
Trustee a direction inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
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SECTION 6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT [AND TO CONVERT SECURITIES].
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Security to receive payment of principal and interest on the
Security, on or after the respective due dates expressed in the Security[, to
convert the Security as and to the extent permitted by this Indenture and the
terms of the Security] or to bring suit for the enforcement of any such payment
[or of the right to convert the Security] on or after such respective dates,
shall not be impaired or affected without the consent of the Holder.
SECTION 6.08. COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.01(1) or (2) occurs and
is continuing, the Trustee may recover judgment in its own name and as trustee
of an express trust against the Company for the whole amount of principal and
interest remaining unpaid on the Securities and interest on overdue principal
and interest and such further amount as shall be sufficient to cover the costs
and, to the extent lawful, expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
SECTION 6.09. TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee and
the Securityholders allowed in any judicial proceedings relative to the Company,
its creditors or its property. Nothing contained herein shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf of
any Securityholder 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 Securityholder in
any such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money pursuant to this Article, it shall
pay out the money in the following order:
First: to the Trustee for amounts due under Section 7.07;
Second: to Securityholders for amounts due and unpaid on the
Securities for principal and interest, ratably, without
preference or priority of any kind, according to the amounts
due and payable on the Securities for principal and interest,
respectively; and
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Third: to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders.
SECTION 6.11. UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as a Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys fees, against any party litigant in the suit, having due regard to the
merits and good faith of the claims or defenses made by the party litigant. This
Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.07 or a suit by Holders of more than 10% in principal amount of the
then outstanding Securities.
ARTICLE 7
THE TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed.
SECTION 7.01. DUTIES OF THE TRUSTEE.
(a) If 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 person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are
specifically set forth in this Indenture and no others; 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. However, 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
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shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b)
of this Section;
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) The Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right or
power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 7.02. RIGHTS OF THE TRUSTEE.
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper person. The Trustee need not
investigate any fact or matter stated in such a document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate, an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
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(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers.
(e) The Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion 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.
(f) 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 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.
SECTION 7.03. INDIVIDUAL RIGHTS OF THE TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or an
Affiliate with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. However, the Trustee is subject to Sections
7.10 and 7.11.
SECTION 7.04. TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities and it shall not be responsible for any
statement in the Indenture or any statement in the Securities other than its
authentication.
SECTION 7.05. NOTICE OF DEFAULTS.
If a Default occurs and is continuing and if it is known to the
Trustee, the Trustee shall mail to each Securityholder a notice of the Default
within 90 days after it occurs. Except in the case of a Default in payment on
any Security, the Trustee may withhold the notice if and so long as a committee
of its Trust Officers in good faith determines that withholding the notice is in
the interests of Securityholders.
SECTION 7.06. REPORTS BY THE TRUSTEE TO HOLDERS.
Within 60 days after the reporting date stated in Section 10.10, the
Trustee shall mail to Securityholders a brief report dated as of such reporting
date that complies with TIA Section 313(a), if such report is required by TIA
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Section 313(a). The Trustee also shall comply with TIA Section 313(b)(2). The
Trustee shall also transmit by mail all reports as required by TIA Section
313(c).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each stock exchange on which the Securities are
listed. The Company shall promptly notify the Trustee when the Securities are
listed on any stock exchange.
SECTION 7.07. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time such
compensation as shall be agreed in writing between the Company and the Trustee
for its services hereunder. The Trustee's compensation shall not be limited by
any law on compensation of a trustee of an express trust. The Company shall
reimburse the Trustee upon request for all reasonable out-of-pocket expenses
incurred by it. Such expenses may include the reasonable compensation and
out-of-pocket expenses of the Trustee's agents and counsel.
The Company shall indemnify each of the Trustee and any successor
Trustee against any loss, damage, claims, liability or out-of-pocket expenses,
including taxes (other than taxes based on the income, revenues or receipts of
the Trustee) incurred by it in connection with the acceptance (with respect to
legal fees and other out-of-pocket expenses of the Trustee in connection with
the acceptance of the trust or trusts hereunder, to the extent provided in the
writing provided for in this Section 7.07) or administration of the trust or
trusts hereunder, except as set forth in the next paragraph. The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity. The
Company shall defend the claim with counsel, who may be outside counsel to the
Company but shall in all events be reasonably satisfactory to the Trustee, and
the Trustee shall cooperate in the defense. In addition, if the Company does not
so defend the Trustee or if at any time the counsel so selected is ethically
prohibited from representing the Trustee (whether because of a conflict of
interest or the provisions of the TIA), then the Trustee may retain one separate
counsel and the Company shall pay the reasonable fees and expenses of such
separate counsel. The indemnification herein extends to any settlement, provided
that the Company will not be liable for any settlement made without its consent,
provided further that such consent will not be unreasonably withheld.
The Company need not reimburse any expense or indemnify against any
loss or liability incurred by the Trustee through negligence or bad faith.
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or property held
or
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collected by the Trustee, except that held in trust to pay principal and
interest on Securities.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(6) or (7) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
The provisions of this Section 7.07 shall survive the termination of
this Indenture.
SECTION 7.08. REPLACEMENT OF THE TRUSTEE.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section.
The Trustee may resign by so notifying the Company. The Holders of a
majority in principal amount of the then outstanding Securities may remove the
Trustee by so notifying the removed Trustee and the Company and may appoint a
successor Trustee with the Company's consent. The Company may remove the Trustee
if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(3) a Custodian or public officer takes charge of the Trustee
or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount of the then outstanding Securities may appoint
a successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of at least 10% in principal amount of the then outstanding Securities
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
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If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The removed or retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, subject to
the lien provided for in Section 7.07. Notwithstanding the replacement of the
Trustee pursuant to this Section 7.08, the Company's obligations under Section
7.07 hereof shall continue for the benefit of the retiring Trustee with respect
to expenses and liabilities incurred by it prior to such replacement.
SECTION 7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1). The Trustee shall always have a combined
capital and surplus as stated in Section 10.10. The Trustee is subject to TIA
Section 310(b), including the optional provision permitted by the second
sentence of TIA Section 310(b)(9).
SECTION 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship set forth in TIA Section 311(b). A Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated therein.
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01. TERMINATION OF COMPANY'S OBLIGATIONS.
(a) This Indenture shall cease to be of further effect (except that the
Company's obligations under Section 7.07 and 8.03 shall survive) when all
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outstanding Securities theretofore authenticated and issued have been delivered
(other than destroyed, lost or stolen Securities that have been replaced or
paid) to the Trustee for cancellation and the Company has paid all sums payable
hereunder. In addition, the Company may elect to have either paragraph (b) or
paragraph (c) below be applied to the outstanding Securities upon compliance
with the conditions set forth in paragraph (d).
(b) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (b), the Company shall be deemed to have been
released and discharged from its obligations with respect to the outstanding
Securities on the date the conditions set forth below are satisfied ("legal
defeasance"). For this purpose, legal defeasance means that the Company shall be
deemed to have paid and discharged the entire indebtedness represented by the
outstanding Securities, which shall thereafter be deemed to be "outstanding"
only for the purposes of the Sections of and matters under this Indenture
referred to in (i) and (ii) below, and to have satisfied all its other
obligations under such Securities and this Indenture insofar as such Securities
are concerned (and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging the same), except for the following, which
shall survive until otherwise terminated or discharged hereunder: (i) the rights
of Holders of outstanding Securities to receive solely from the trust fund
described in paragraph (d) below and as more fully set forth in such paragraph,
payments in respect of the principal of, premium, if any, and interest on such
Securities when such payments are due, (ii) the Company's obligations with
respect to such Securities under Sections 2.06, 2.07 and 4.04, and, with respect
to the Trustee, under Section 7.07, (iii) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and (iv) this Section 8.01. Subject to
compliance with this Section 8.01, the Company may exercise its option under
this paragraph (b) notwithstanding the prior exercise of its option under
paragraph (c) below with respect to the Securities.
(c) Upon the Company's exercise under paragraph (a) of the option
applicable to this paragraph (c), the Company shall be released and discharged
from its obligations under any covenant contained in Article 5 and in Sections
4.02 through 4.12 with respect to the outstanding Securities on and after the
date the conditions set forth below are satisfied ("covenant defeasance"), and
the Securities shall thereafter be deemed to be not "outstanding" for the
purpose of any direction, waiver, consent or declaration or act of Holders (and
the consequences of any thereof) in connection with such covenants, but shall
continue to be deemed "outstanding" for all other purposes hereunder. For this
purpose, such covenant defeasance means that, with respect to the outstanding
Securities, the Company may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such covenant or by reason of any reference in any such covenant to any
other
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provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01 but, except as
specified above, the remainder of this Indenture and such Securities shall be
unaffected thereby.
(d) The following shall be the conditions to the application of either
paragraph (b) or (c) above to the outstanding Securities:
(1) the Company has irrevocably deposited in trust with the
Trustee or, at the option of the Trustee, with a trustee, satisfactory
to the Trustee and the Company under the terms of an irrevocable trust
agreement in form and substance satisfactory to the Trustee, money or
United States Government Obligations (defined below in this Section
8.01) sufficient to pay principal and interest on the Securities to
maturity and all other sums payable by it hereunder; provided that (i)
the trustee of the irrevocable trust shall have been irrevocably
instructed to pay such money or the proceeds of such United States
Government Obligations to the Trustee and (ii) the Trustee shall have
been irrevocably instructed to apply such money or the proceeds of such
United States Government Obligations to the payment of said principal
and interest with respect to the Securities;
(2) the Company has delivered to the Trustee an Officers'
Certificate stating that (A) all conditions precedent provided for
relating to either the legal defeasance under paragraph (b) above or
the covenant defeasance under paragraph (c) above, as the case may be,
have been complied with and (B) if any other Indebtedness of the
Company shall then be outstanding or committed, such legal defeasance
or covenant defeasance will not violate the provisions of the
agreements or instruments evidencing such Indebtedness;
(3) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit;
(4) such legal defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a Default or Event of
Default under, this Indenture or any other agreement or instrument to
which the Company is a party or by which it is bound;
(5) in the case of an election under paragraph (b) above, the
Company shall have delivered to the Trustee an Opinion of Counsel from
nationally recognized counsel acceptable to the Trustee stating that
(x) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling or
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(y) since the date of this Indenture, there has been a change in the
applicable federal income tax law, in either case to the effect that
the Holders of the outstanding Securities will not recognize income,
gain or loss for federal income tax purposes as a result of such legal
defeasance and will be subject to federal income tax on the same amount
and in the same manner and at the same time as would have been the case
if such legal defeasance had not occurred; and
(6) in the case of an election under paragraph (c) above, the
Company shall have delivered to the Trustee an Opinion of Counsel from
nationally recognized counsel acceptable to the Trustee (i) to the
effect that the Holders of the outstanding Securities will not
recognize income, gain or loss for federal income tax on the same
amount and in the same manner and at the same time as would have been
the case if such covenant defeasance had not occurred or (ii) that the
Company has received from, or there has been published by, the Internal
Revenue Service a ruling to the foregoing effect.
After such irrevocable deposit made pursuant to this Section 8.01 and
satisfaction of the other conditions set forth herein, the Trustee upon request
shall acknowledge in writing the discharge of the Company's obligations under
this Indenture except for those surviving obligations specified above.
As used herein, "United States Government Obligations" means direct
obligations of the United States of America for the payment of which the full
faith and credit of the United States of America is pledged. In order to have
money available on a payment date to pay principal or interest on the
Securities, the United States Government Obligations shall be payable as to
principal or interest on or before such payment date in such amounts as will
provide the necessary money. United States Government Obligations shall not be
callable at the issuer's option.
SECTION 8.02. APPLICATION OF TRUST MONEY.
The Trustee shall hold in trust money or United States Government
Obligations deposited with it pursuant to Section 8.01. It shall apply the
deposited money and the money from United States Government Obligations through
the Paying Agent and in accordance with this Indenture to the payment of
principal and interest on the Securities. Money and securities so held in trust
are not subject to Article 11.
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SECTION 8.03. REPAYMENT TO COMPANY.
Subject to Section 8.01(d), the Trustee and the Paying Agent shall
promptly pay to the Company upon written request any excess money or securities
held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon written
request any money held by them for the payment of principal or interest that
remains unclaimed for two years after the date upon which such payment shall
have become due; provided, however, that the Company shall have first caused
notice of such payment to the Company to be mailed to each Securityholder
entitled thereto no less than 30 days prior to such payment. After payment to
the Company, Securityholders entitled to the money must look to the Company for
payment as general creditors unless an applicable abandoned property law
designates another person.
SECTION 8.04. REINSTATEMENT.
If (i) the Trustee or Paying Agent is unable to apply any money in
accordance with Section 8.02 by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application and (ii) the Holders of at least a majority in principal amount of
the then outstanding Securities so request by written notice to the Trustee, the
Company's obligations under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to Section 8.01 until
such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 8.02; provided, however, that if the Company makes any
payment of interest on or principal of any Security following the reinstatement
of its obligations, the Company shall be subrogated to the rights of the Holders
of such Securities to receive such payment from the money held by the Trustee or
Paying Agent.
ARTICLE 9
AMENDMENTS
SECTION 9.01. WITHOUT THE CONSENT OF HOLDERS.
The Company and the Trustee may amend this Indenture or the Securities
without notice to or the consent of any Securityholder:
(1) to cure any ambiguity, defect or inconsistency;
(2) to comply with Section[s] 5.01 [and 12.18];
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(3) to provide for uncertificated Securities in addition to
certificated Securities;
(4) to make any change that does not adversely affect the
legal rights hereunder of any Securityholder;
(5) to add to the covenants of the Company such further
covenants, restrictions, conditions or provisions as the Company and
the Trustee shall consider to be for the protection of the
Securityholders, and to make the occurrence, or the occurrence and
continuance, of a default in any such additional covenants,
restrictions, conditions or provisions an Event of Default permitting
the enforcement of all or any of the several remedies provided in this
Indenture as herein set forth; provided that in respect of any such
additional covenant, restriction, condition or provision, such
supplemental indenture may provide for a particular period of grace
after default (which period may be shorter or longer than that allowed
in the case of other defaults) or may provide for an immediate
enforcement upon such an Event of Default or may limit the remedies
available to the Trustee upon such an Event of Default or may limit the
right of the Securityholders to waive such an Event of Default;
(6) to surrender any right or power herein conferred upon the
Company;
(7) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the
qualification of the Indenture under the TIA, or under any similar
federal statute hereafter enacted; or
(8) before any Securities are issued, to make any other change
in this Indenture not prohibited by the TIA.
SECTION 9.02. WITH THE CONSENT OF HOLDERS.
Subject to Section 6.07, the Company and the Trustee may amend this
Indenture or the Securities with the written consent of the Holders of at least
a majority in principal amount of the then outstanding Securities.
Subject to Sections 6.04 and 6.07, the Holders of a majority in
principal amount of the Securities then outstanding may also waive compliance in
a particular instance by the Company with any provision of this Indenture or the
Securities.
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However, without the consent of each Securityholder affected, an
amendment or waiver under this Section may not:
(1) reduce the amount of Securities whose Holders must consent
to an amendment, supplement or waiver;
(2) reduce the rate of or change the time for payment of
interest on any Security;
(3) reduce the principal of or change the fixed maturity of
any Security or alter the redemption provisions with respect thereto;
(4) make any Security payable in money other than that stated
in the Security;
(5) make any change in Section 6.04, 6.07 or 9.02 (this
sentence); [or]
(6) waive a default in the payment of the principal of, or
interest on, any Security [or any default under Article 12; or]
(7) make any change that adversely affects the right to
convert any Security].
To secure a consent of the Holders under this Section, it shall not be
necessary for the Holders to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment or waiver under this Section becomes effective, the
Company shall mail to Securityholders a notice briefly describing the amendment
or waiver.
SECTION 9.03. COMPLIANCE WITH THE TRUST INDENTURE ACT.
Every amendment to this Indenture or the Securities shall be set forth
in a supplemental indenture that complies with the TIA as then in effect.
SECTION 9.04. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment or waiver becomes effective, a consent to it by a
Holder of a Security is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent
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Holder may revoke the consent as to his or her Security or portion of a Security
if the Trustee receives the notice of revocation before the date on which the
Trustee receives an Officers' Certificate certifying that the Holders of the
requisite principal amount of Securities have consented to the amendment or
waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment or
waiver. If a record date is fixed, then notwithstanding the provisions of the
immediately preceding paragraph, those persons who were Holders at such record
date (or their duly designated proxies), and only those persons, shall be
entitled to consent to such amendment or waiver or to revoke any consent
previously given, whether or not such persons continue to be Holders after such
record date. No consent shall be valid or effective for more than 90 days after
such record date unless consents from Holders of the principal amount of
Securities required hereunder for such amendment or waiver to be effective shall
have also been given and not revoked within such 90-day period.
After an amendment or waiver becomes effective it shall bind every
Securityholder, unless it is of the type described in any of clauses (1) through
(7) of Section 9.02. In such case, the amendment or waiver shall bind each
Holder of a Security who has consented to it.
SECTION 9.05. NOTATION ON OR EXCHANGE OF SECURITIES.
The Trustee may place an appropriate notation about an amendment or
waiver on any Security thereafter authenticated. The Company in exchange for all
Securities may issue and the Trustee shall authenticate new Securities that
reflect the amendment or waiver.
SECTION 9.06. THE TRUSTEE PROTECTED.
The Trustee shall sign all supplemental indentures, except that the
Trustee need not sign any supplemental indenture that adversely affects its
rights. The Company may not sign an amendment or supplement until the Board of
Directors approves it. The Trustee, subject to Sections 7.01 and 7.02, shall be
entitled to receive, and shall be fully protected in relying upon, an Opinion of
Counsel stating that any amendment, supplement or waiver is authorized or
permitted by this Indenture and complies with the provisions of this Article 9.
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ARTICLE 10
GENERAL PROVISIONS
SECTION 10.01. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the TIA
as in effect at the date hereof or, to the extent required by law, as amended
after the date hereof, the required provision shall control.
SECTION 10.02. NOTICES.
Any notice or communication by the Company or the Trustee to the other
is duly given if in writing and delivered in person or mailed by first-class
mail to the other's address stated in Section 10.10. The Company or the Trustee
by notice to the other may designate an additional or different address for
subsequent notices or communications.
Any notice or communication to a Securityholder shall be mailed by
first class mail to his or her address shown on the register kept by the
Registrar. Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Securityholders, it
shall mail a copy to the Trustee and each Agent at the same time.
All other notices or communications shall be in writing.
SECTION 10.03. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
SECTION 10.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
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(1) an Officers' Certificate stating that, in the opinion of
the Company, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 10.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:
(1) a statement that the person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of the Company, such
person has made such examination or investigation as is necessary to
enable him or her to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of the
Company, such condition or covenant has been complied with;
provided, however, that with respect to matters of fact an Opinion of Counsel
may rely on an Officers' Certificate.
SECTION 10.06. RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or a meeting of
Securityholders. The Registrar [, or] Paying Agent [or Conversion Agent] may
make reasonable rules and set reasonable requirements for its functions.
SECTION 10.07. LEGAL HOLIDAYS; BUSINESS DAYS.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banking
institutions in the City of New York or in the city in which the principal
office of the Trustee is located are not required to be open, and a "Business
Day" is any day that is not a Legal Holiday. If a payment date is a Legal
Holiday at a place of payment, payment may be made at that place on the
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48
next succeeding day that is not a Legal Holiday, and no interest shall accrue
for the intervening period.
SECTION 10.08. NO RECOURSE AGAINST OTHERS.
No director, officer, employee or shareholder, as such, of the Company
shall have any liability for any obligations of the Company under the Securities
or the Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. Each Securityholder by accepting a Security
waives and releases all such liability. The waiver and release are part of the
consideration for the Securities.
SECTION 10.09. COUNTERPARTS.
This Indenture may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.
SECTION 10.10. OTHER PROVISIONS.
"Officer" means Chairman of the Board, the Chief Executive Officer, the
President, the Chief Financial Officer, the Chief Accounting Officer, any
Executive Vice President, Senior Vice President, any Vice President, the
Treasurer, any other Executive Officer, the Secretary, any Assistant Treasurer
or any Assistant Secretary of the Company.
The Company initially appoints the Trustee as Paying Agent, Registrar
and authenticating agent.
The first certificate pursuant to Section 4.03 shall be for the fiscal
year ending on the first June 30 following the issuance of Securities hereunder,
but in no event later than one year after the date hereof.
The reporting date for Section 7.06 is September 15 of each year. The
first reporting date is the first September 15 following the issuance of
Securities hereunder.
The Trustee shall always have a combined capital and surplus of at
least $10,000,000 as set forth in its most recent published annual report of
condition.
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The Company's address is:
Xxx Xxxx Corporation
0000 00xx Xxxxxx
Xxxxxxx, XX 00000
Attention: General Counsel
The Trustee's address [for purposes of Sections 2.03 and 4.04] is:
[State Street Bank and Trust Company
New York, New York
and for all other purposes hereunder is:
State Street Bank and Trust Company
Attn: Corporate Trust Division.]
SECTION 10.11. GOVERNING LAW.
The internal laws of the State of New York shall govern this Indenture,
the Securities, and all disputes arising under or related to either of them,
without regard to the choice or conflicts of laws provisions thereof. If any
action or proceeding shall be brought by a Holder of any of the Securities or by
the Trustee in order to enforce any right or remedy under this Indenture or
under the Securities, the Company hereby consents and will submit to the
jurisdiction of the courts of the State of New York sitting in the City of New
York or any federal court sitting in the City of New York. The Company hereby
agrees to accept service of process by notice given to it pursuant to the
provisions of Section 10.02.
SECTION 10.12. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or a subsidiary. Any such other indenture, loan or
debt agreement may not be used to interpret this Indenture.
SECTION 10.13. SUCCESSORS.
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
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SECTION 10.14. SEVERABILITY.
In case any provision in this Indenture or in 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 10.15. TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.
ARTICLE 11
OMITTED
[ARTICLE 12
CONVERSION
SECTION 12.01. CONVERSION PRIVILEGE.
For the purpose of this Article XII and paragraph 17 of the Securities,
["Common Stock" means the common stock of the Company as it exists on the date
of this Indenture or as it may be constituted from time to time.] [and]
["Preferred Stock" means the Series __ Preferred Stock of the Company].
A Holder of a Security may convert it into [Preferred] [Common] Stock
at any time during the period stated in paragraph 17 of the Securities. The
number of shares issuable upon conversion of a Security is determined as
follows: (i) divide the principal amount to be converted by the conversion price
in effect on the conversion date; then (ii) round the result to the nearest
1/100th of a share.
The initial conversion price is stated in paragraph 17 of the
Securities. The conversion price is subject to adjustment.
A Holder may convert a portion of a Security if the portion is $1,000
or an integral multiple of $1,000. Provisions of this Indenture that apply to
conversion of all of a Security also apply to conversion of a portion of it.
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SECTION 12.02. CONVERSION PROCEDURE.
To convert a Security a Holder must satisfy the requirements in
paragraph 17 of the Securities. The date on which the Holder satisfies all those
requirements is the conversion date. As soon as practical, the Company shall
deliver through the Conversion Agent a certificate for the number of full shares
of [Preferred] [Common] Stock issuable upon the conversion and a check for any
fractional share. The person in whose name the certificate is registered shall
be treated as a stockholder of record on and after the conversion date.
No payment or adjustment will be made for accrued interest on a
converted Security or dividends on any [Preferred] [Common] Stock issued.
However, interest will be paid on any interest payment date with respect to
Securities surrendered for conversion after a record date for the payment of
interest to the registered Holder on such record date.
If a Holder converts more than one Security at the same time, the
number of full shares issuable upon the conversion shall be based on the total
principal amount of the Securities converted.
Upon a surrender of a Security that is converted in part, the Company
shall issue and the Trustee shall authenticate for the Holder a new Security
equal in principal amount to the unconverted portion of the Security
surrendered.
If the last day on which a Security may be converted is a Legal Holiday
in a place where a Conversion Agent is located, the Security may be surrendered
to that Conversion Agent on the next succeeding day that is not a Legal Holiday.
SECTION 12.03. FRACTIONAL SHARES.
The Company will not issue a fractional share of [Preferred] [Common]
Stock upon conversion of a Security. Instead the Company will deliver its check
for the current market value of the fractional share. The current market value
of a fraction of a share is determined as follows: (i) multiply the current
market price of a full share by the fraction; then (ii) round the result to the
nearest cent.
The current market price of a share of [Preferred] [Common] Stock is
the Quoted Price of the [Preferred] [Common] Stock on the last trading day prior
to the conversion date. As used in Sections 12.03 and 12.11, the "Quoted Price"
of the Common Stock is the last reported sales price of the [Preferred] [Common]
Stock on the New York Stock Exchange or such other securities exchange on which
the [Preferred] [Common] Stock may
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then be listed, or if the Common Stock is not listed on a securities exchange,
the last reported sales price of the [Preferred] [Common] Stock as reported by
NASDAQ, National Market System or if neither so reported or listed, the last
reported bid price of the [Preferred] [Common] Stock. In the absence of such a
quotation, the Company shall determine the current market price on the basis of
such quotations or other information as it considers appropriate.
SECTION 12.04. TAXES ON CONVERSION.
If a Holder of a Security converts it, the Company shall pay any
documentary, stamp or similar issue or transfer tax due on the issue of shares
of [Preferred] [Common] Stock upon the conversion. However, the Holder shall pay
any such tax which is due because the shares are issued in a name other than the
Holder's name.
SECTION 12.05. COMPANY TO PROVIDE STOCK.
The Company has reserved and shall continue to reserve out of its
authorized but unissued [Preferred] [Common] Stock or its [Preferred] [Common]
Stock held in treasury enough shares of [Preferred] [Common] Stock to permit the
conversion of the Securities in full.
All shares of [Preferred] [Common] Stock which may be issued upon
conversion of the Securities shall be fully paid and non-assessable.
The Company will endeavor to comply with all securities laws regulating
the offer and delivery of shares of [Preferred] [Common] Stock upon conversion
of Securities and will endeavor to list such shares on each national securities
exchange on which the [Preferred] [Common] Stock is listed.
SECTION 12.06. ADJUSTMENT FOR CHANGE IN CAPITAL STOCK.
Subject to Section 12.18, if the Company:
(1) pays a dividend or makes a distribution on its [Preferred]
[Common] Stock in shares of its [Preferred] [Common] Stock;
(2) subdivides its outstanding shares of [Preferred] [Common]
Stock into a greater number of shares;
(3) combines its outstanding shares of [Preferred] [Common]
Stock into a smaller number of shares;
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(4) makes a distribution on its [Preferred] [Common] Stock in
shares of its capital stock other than [Preferred] [Common] Stock; or
(5) issues by reclassification of its [Preferred] [Common]
Stock any shares of its capital stock;
then the conversion privilege and the conversion price in effect immediately
prior to such action shall be adjusted so that the Holder of a Security
thereafter converted may receive the number of shares of capital stock of the
Company which he would have owned immediately following such action if he had
converted the Security immediately prior to such action.
The adjustment shall become effective immediately after the record date
in the case of a dividend or distribution and immediately after the effective
date in the case of a subdivision, combination or reclassification.
If after an adjustment a Holder of a Security upon conversion of it may
receive shares of two or more classes of capital stock of the Company, the
Company shall determine the allocation of the adjusted conversion price between
the classes of capital stock. After such allocation, the conversion privilege
and the conversion price of each class of capital stock shall thereafter be
subject to adjustment on terms comparable to those applicable to [Preferred]
[Common] Stock in this Article.
SECTION 12.07. ADJUSTMENT FOR RIGHTS ISSUE.
If the Company distributes any rights or warrants [other than the
Warrants (the "Warrants") which are issued as part of unit consisting of
Warrants and the Securities] to all holders of its [Preferred] [Common] Stock
entitling them for a period expiring within 60 days after the record date
mentioned below to purchase shares of [Preferred] [Common] Stock at a price per
share less than the current market price per share on that record date, the
conversion price shall be adjusted in accordance with the formula set forth
below and the paragraph following such formula:
N x P
------
C' = C x O + M
------------
O + N
where:
C' = the adjusted conversion price.
C = the current conversion price.
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O = the number of shares of [Preferred] [Common] Stock
outstanding on the record date.
N = the number of additional shares of [Preferred] [Common] Stock
offered.
P = the offering price per share of the additional shares.
M = the current market price per share of [Preferred] [Common]
Stock on the record date.
The adjustment shall be made successively whenever any such rights
become exercisable or such warrants are issued and shall become effective
immediately after the rights become exercisable or after the record date for the
determination of stockholders entitled to receive the warrants. If at the end of
the period during which such warrants or rights are exercisable, not all
warrants or rights shall have been exercised, the conversion price shall be
immediately readjusted to what it would have been if "N" in the above formula
had been the number of shares actually issued.
SECTION 12.08. ADJUSTMENT FOR OTHER DISTRIBUTIONS.
If the Company distributes to all holders of its [Preferred] [Common]
Stock (as such) any of its assets or debt securities or any rights or warrants
to purchase assets, debt securities or other securities of the Company, the
conversion price shall be adjusted in accordance with the formula set forth
below and the paragraph following such formula:
C' = C x M - F
-----
M
where:
C' = the adjusted conversion price.
C = the current conversion price.
M = the current market price per share of [Preferred] [Common]
Stock on the record date mentioned below.
F = the fair market value on the record date of the assets,
securities, rights or warrants applicable to one share of
[Preferred] [Common] Stock. The Board of Directors shall
determine the fair market value.
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The adjustment shall be made successively whenever any such rights
become exercisable or any such distribution (other than of such rights) is made
and shall become effective immediately after any such rights become exercisable
(as to rights) or after the record date for the determination of stockholders
entitled to receive the distribution (as to other distributions).
Notwithstanding the foregoing, no adjustment shall be made in the event that
rights become exercisable if and to the extent Holders of Securities have
received or are entitled to receive such rights upon conversion. In addition, to
the extent the rights or warrants expire unexercised, then the conversion price
shall be promptly readjusted to the conversion price which would then be in
effect had the adjustment been made based on the number of rights or warrants
exercised.
This Section does not apply to regular cash dividends or cash
distributions paid out of consolidated current earnings as shown on the books of
the Company. Also, this Section does not apply to rights or warrants referred to
in Section 12.07, including the Warrants.
SECTION 12.09. ADJUSTMENT FOR [PREFERRED] [COMMON] STOCK ISSUE.
If the Company issues shares of [Preferred] [Common] Stock for a
consideration per share less than the current market price per share on the date
the Company fixes the offering price of such additional shares, the conversion
price shall be adjusted in accordance with the formula:
O + P
--
C' = C x M
-----
A
where:
C' = the adjusted conversion price.
C = the then current conversion price.
O = the number of shares outstanding immediately prior to the
issuance of such additional shares.
P = the aggregate consideration received for the issuance of
such additional shares.
M = the current market price per share on the date of issuance
of such additional shares.
A = the number of shares outstanding immediately after the
issuance of such additional shares.
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The adjustment shall be made successively whenever any such issuance is
made, and shall become effective immediately after such issuance.
This Section does not apply to (i) any of the transactions described in
Sections 12.07, 12.08 and 12.10, (ii) the conversion of Securities, or the
conversion, exchange or exercise of other securities convertible or exchangeable
for [Preferred] [Common] Stock, (iii) [Preferred] [Common] Stock issued to the
Company's employees under bona fide employee plans adopted by the Board of
Directors and approved by the holders of [Preferred] [Common] Stock when
required by law, if such [Preferred] [Common] Stock would otherwise be covered
by this Section (but only to the extent that the aggregate number of shares
excluded hereby and issued after the date of this Indenture shall not exceed
[5%] of the [Preferred] [Common] Stock outstanding at the time of the adoption
of each such plan, exclusive of antidilution adjustments thereunder), (iv)
[Preferred] [Common] Stock issued to acquire, or in the acquisition of, all or
any portion of a business as a going concern or of developed, undeveloped or
mixed real property, in an arms-length transaction between the Company and an
unaffiliated third party, whether such acquisition shall be effected by purchase
of assets, exchange of securities, merger, consolidation or otherwise, (v)
[Preferred] [Common] Stock issued in a bona fide public offering pursuant to a
firm commitment underwriting or (vi) [Preferred] [Common] Stock issued on
exercise of rights if and to the extent Holders of Securities have received or
are entitled to receive such rights upon conversion.
SECTION 12.10. ADJUSTMENT FOR CONVERTIBLE SECURITIES ISSUE.
If the Company issues any securities convertible into or exchangeable
or exercisable for [Preferred] [Common] Stock (other than the Securities or
securities issued in transactions described in Sections 12.07 and 12.08) for a
consideration per share of [Preferred] [Common] Stock initially deliverable upon
conversion, exchange or exercise of such securities less than the current market
price per share on the date of issuance of such securities, the conversion price
shall be adjusted in accordance with this formula:
O + P
--
C' = C x M
-------
O + D
where:
C' = the adjusted conversion price.
C = the then current conversion price.
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O = the number of shares outstanding immediately prior to the
issuance of such securities.
P = the aggregate consideration received for the issuance of
such securities (including as determined in Section 12.12(3)).
M = the current market price per share on the date of issuance
of such securities.
D = the maximum number of shares deliverable upon conversion
or in exchange for or upon exercise of such securities at the
initial conversion, exchange or exercise rate.
The adjustment shall be made successively whenever any such issuance is
made, and shall become effective immediately after such issuance. If all of the
[Preferred] [Common] Stock deliverable upon conversion, exchange or exercise of
such securities have not been issued when such securities are no longer
convertible, exchangeable or exercisable, then the conversion price shall
promptly be readjusted to the conversion price which would then be in effect had
the adjustment upon the issuance of such securities been made on the basis of
the actual number of shares of [Preferred] [Common] Stock issued upon
conversion, exchange or exercise of such securities.
This Section does not apply to (1) convertible securities issued to
acquire, or in the acquisition of, all or any portion of a business as a going
concern or of developed, undeveloped or mixed real property, in an arms-length
transaction between the Company and an unaffiliated third party, whether such
acquisition shall be effected by purchase of assets, exchange of securities,
merger, consolidation or otherwise, or (ii) convertible securities issued in a
bona fide public offering pursuant to a firm commitment underwriting.
SECTION 12.10A. SPECIAL PROVISION REGARDING PREFERRED STOCK.
In addition to the foregoing adjustments and without duplication, if
(x) prior to the exercise of a Security an event ("Event") occurs which, under
the Certificate of Designations with respect to the Preferred Stock, would have
required an adjustment in the number of share(s) of Common Stock into which the
shares of Preferred Stock acquired on conversion of the Securities would have
been convertible if such Security had previously been converted into Preferred
Stock (but such Preferred Stock acquired on conversion had not been converted
into Common Stock), then (y) after the Event, such share of Preferred Stock
shall, when acquired on conversion of the Security, be convertible into the same
number of share(s) of Common Stock into which it would have been convertible if
such Security had been converted into Preferred Stock (but such Preferred Stock
acquired on conversion had not
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been converted into Common Stock) prior to the Event. The adjustment required by
the foregoing sentence shall be made each time there is an Event, provided that
no adjustment shall be made under this Section 12.10A unless that adjustment
results in a change of 1%, provided further that all adjustments not made by
virtue of the preceding "provided" clause shall be carried forward and made when
the aggregate of all such adjustments results in a change of at least 1%.]*
SECTION 12.11. CURRENT MARKET PRICE.
In Sections 12.07, 12.08, 12.09 and 12.10, the current market price per
share of [Preferred] [Common] Stock on any date is the average of the Quoted
Prices (as defined in Section 12.03) of the [Preferred] [Common] Stock for 20
consecutive trading days commencing 30 trading days before the date in question.
In the absence of one or more such quotations, the Company shall determine the
current market price on the basis of such quotations or other information as it
considers appropriate.
SECTION 12.12. CONSIDERATION RECEIVED.
For purposes of any computation respecting consideration received
pursuant to Sections 12.09 and 12.10, the following shall apply:
(1) in the case of the issuance of shares of [Preferred]
[Common] Stock for cash, the consideration shall be the amount of such
cash, provided that in no case shall any deduction be made for any
commissions, discounts or, without limitation, other expenses incurred
by the Company for any underwriting of the issue or otherwise in
connection therewith,
(2) in the case of the issuance of shares of [Preferred]
[Common] Stock for a consideration in whole or in part other than cash,
the consideration other than cash shall be deemed to be the fair market
value thereof as determined in good faith by the Board of Directors
(irrespective of the accounting treatment thereof), whose determination
shall be conclusive, and described in a Board resolution which shall be
filed with the Trustee; and
----------
* This provision will be used, if at all, if the Securities are exercisable
for Preferred Stock which is convertible into Common Stock.
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(3) in the case of the issuance of securities convertible into
or exchangeable or exercisable for shares, the aggregate consideration
received therefor shall be deemed to be the consideration received by
the Company for the issuance of such securities plus the additional
minimum consideration, if any, to be received by the Company upon the
conversion or exchange thereof (the consideration in each case to be
determined in the same manner as provided in clauses (1) and (2) of
this Section).
SECTION 12.13. WHEN ADJUSTMENT MAY BE DEFERRED.
No adjustment in the conversion price need be made unless the
adjustment would require an increase or decrease of at least 1% in the
conversion price. Any adjustments that are not 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 1/100th of a share, as the case may be.
SECTION 12.14. WHEN NO ADJUSTMENT REQUIRED.
No adjustment need be made for a transaction referred to in Sections
12.06, 12.07, 12.08, 12.09 or 12.10 if all Securityholders are entitled to
participate in the transaction on a basis and with notice that the Board of
Directors determines to be fair and appropriate in light of the basis and notice
on which holders of [Preferred] [Common] Stock participate in the transaction.
No adjustment need be made for rights to purchase [Preferred] [Common]
Stock pursuant to a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value or no par
value of the [Preferred] [Common] Stock.
To the extent the Securities become convertible into cash, no
adjustment need be made thereafter as to the cash. Interest will not accrue or
be deemed to accrue on the cash for this purpose.
In any case in which this Article 12 or the Securities shall require
that an adjustment in the conversion price be made effective as of a record date
for a specified event and notwithstanding anything to the contrary in this
Article 12 of the Securities, the Company may elect to defer until the
occurrence of such event the issuing to the holder of any Security converted
after such record date, the [Preferred] [Common] Stock or other capital stock of
the Company, if any, issuable upon such conversion over and above
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the [Preferred] [Common] Stock or other capital stock of the Company, if any,
issuable upon such conversion on the basis of the conversion price in effect
prior to such adjustment; provided, however, [that the Company shall deliver to
such holder a due xxxx or other appropriate instrument evidencing, subject to
the following proviso, such holder's right to receive such additional shares
upon the occurrence of the event requiring such adjustment and, provided
further,] to the extent such event does not occur, the adjustment made in
respect of such non-occurrence shall be retroactive and affect each conversion
security converted between such Record Date and the date of such non-occurrence.
SECTION 12.15. NOTICE OF ADJUSTMENT.
Whenever the conversion price is adjusted, the Company shall promptly
mail to Securityholders a notice of the adjustment. The Company shall file with
the Trustee a certificate from the Company's independent public accountants
briefly stating the facts requiring the adjustment and the manner of computing
it. The certificate shall be conclusive evidence that the adjustment is correct,
absent manifest error.
SECTION 12.16. VOLUNTARY REDUCTION.
The Company from time to time may reduce the conversion price by any
amount for any period of time if the period is at least [20] days and if the
reduction is irrevocable during the period; provided that in no event may the
conversion price be less than the then par value of a share of [Preferred]
[Common] Stock, if any.
Whenever the conversion price is reduced, the Company shall mail to
Securityholders a notice of the reduction. The Company shall mail the notice at
least 15 days before the date the reduced conversion price takes effect. The
notice shall state the reduced conversion price and the period it will be in
effect.
A reduction of the conversion price does not change or adjust the
conversion price otherwise in effect for purposes of Sections 12.06, 12.07,
12.08, 12.09 and 12.10.
SECTION 12.17. NOTICE OF CERTAIN TRANSACTIONS.
If:
(1) the Company takes any action that would require an
adjustment in the conversion price pursuant to Sections 12.06, 12.07,
12.08, 12.09 or 12.10 and if the Company does not let
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Securityholders participate pursuant to Section 12.14 [or which is
referred to in Section 12.10A];
(2) the Company takes any action that would require a
supplemental indenture pursuant to Section 12.18; or
(3) there is a liquidation or dissolution of the Company,
the Company shall mail to Securityholders and to the Trustee a notice stating
the proposed record date, proposed effective date or other relevant proposed
date of the act in question. The Company shall mail the notice at least [15]
days before such date. Failure to mail the notice or any defect in it shall not
affect the validity of the transaction.
SECTION 12.18. REORGANIZATION OF COMPANY.
If the Company is a party to a transaction subject to Section 5.01, or
a transaction which reclassifies or changes its outstanding [Preferred] [Common]
Stock, upon consummation of such transaction the Securities shall automatically
become convertible into the kind and amount of securities, cash or other assets
which the Holder of a Security would have owned immediately after the
transaction if the Holder had converted the Security immediately before the
effective date of the transaction. Concurrently with the consummation of such
transaction, the person obligated to issue securities or deliver cash or other
assets upon conversion of the Securities shall enter into a supplemental
indenture so providing and further providing for adjustments which shall be as
nearly equivalent as may be practical to the adjustments provided for in this
Article. The Company or, if applicable, the other person shall mail to
Securityholders a notice describing the transaction and supplemental indenture.
If securities deliverable upon conversion of Securities, as provided
above, are themselves convertible into the securities of an Affiliate of the
other person, that Affiliate shall join in the supplemental indenture and the
supplemental indenture shall so provide.
If this Section applies, Section 12.06 does not apply.
SECTION 12.19. COMPANY DETERMINATION FINAL.
Any determination that the Company or the Board of Directors must make
pursuant to Section 12.03, 12.06, 12.08, 12.09, 12.10, 12.11, 12.12 or 12.14 is
conclusive.
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SECTION 12.20. TRUSTEE'S DISCLAIMER.
The Trustee has no duty to determine when an adjustment under this
Article should be made, how it should be made or what it should be. The Trustee
has no duty to determine whether any provisions of a supplemental indenture
under Section 12.18 are correct. The Trustee makes no representation as to the
validity or value of any securities or assets issued upon conversion of
Securities. The Trustee shall not be responsible for the Company's failure to
comply with this Article. Each Conversion Agent other than the Company shall
have the same protection under this Section as the Trustee.]
The parties have caused this Indenture to be duly executed and
attested, all as of the date first above written, in _____________,
_____________, signifying their agreements contained in this Indenture.
SIGNATURES
XXX XXXX CORPORATION
By___________________________
Attest:
__________________________
[STATE STREET BANK AND TRUST COMPANY,]
as Trustee
_____________________________
Attest:
__________________________
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EXHIBIT A
(FACE OF SECURITY)*
No. $ CUSIP No. ____
XXX XXXX CORPORATION
promises to pay to
or registered assigns,
the principal sum of Dollars on ________________________
_____% [CONVERTIBLE] SENIOR [DEBENTURE] [NOTE]
DUE ________
Interest Payment Dates: _______________ and _______________
Record Dates: _______________ and _______________
This is one of the Securities Dated:
mentioned in the Indenture
referred to below:
[State Street Bank and Trust XXX XXXX CORPORATION
Company,] as Trustee
By_________________________ By_________________________
Authorized Signatory
By_________________________
------------------------
* Global Securities will have any appropriate modifications and will bear
essentially the following legend:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
REFERRED TO BELOW AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED
OR EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER
THAN THE DEPOSITARY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE
REGISTERED, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
INDENTURE. EVERY SECURITY AUTHENTICATED AND DELIVERED UPON REGISTRATION
OF TRANSFER OF, OR IN EXCHANGE FOR OR IN LIEU OF, THIS SECURITY SHALL
BE A GLOBAL SECURITY SUBJECT TO THE FOREGOING, EXCEPT IN SUCH LIMITED
CIRCUMSTANCES.
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(BACK OF SECURITY)
-------------
___% [Convertible] Senior [Debenture] [Note]
Due __________
1. Interest. Xxx Xxxx Corporation, a Delaware corporation (the
"Company"), promises to pay interest on the principal amount of this Security at
the rate per annum shown above. The Company will pay interest semiannually on
_________ and _________ of each year. Interest on the Securities will accrue
from the most recent date to which interest has been paid or, if no interest has
been paid, from _________, 199_. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
2. Method of Payment. The Company will pay interest on the Securities
(except defaulted interest) to the persons who are registered holders of
Securities at the close of business on the record date for the next interest
payment date even though Securities are cancelled after the record date and on
or before the interest payment date. Holders must surrender Securities to a
Paying Agent to collect principal payments. The Company will pay principal and
interest in money of the United States that at the time of payment is legal
tender for payment of public and private debts. However, the Company may pay
principal and interest by check payable in such money. It may mail an interest
check to a holder's registered address.
3. Paying Agent [, and] Registrar [and Conversion Agent]. [State Street
Bank and Trust Company,] (the "Trustee") will act as Paying Agent [, and]
Registrar [and Conversion Agent]. The Company may change the Paying Agent,
Registrar or co-registrar without prior notice. The Company or any of its
subsidiaries may act in any such capacity.
4. Indenture. The Company issued the Securities under an Indenture
dated as of ___________, 199_ [as modified by a Supplemental Indenture dated as
of ____________ , 199_] ([collectively, ]the "Indenture") between the Company
and the Trustee. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S. Code Sections 77aaa-77bbbb) as in effect on the
date of the Indenture. The Securities are subject to, and qualified by, all
such terms, certain of which are summarized hereon, and Securityholders are
referred to the Indenture and such Act for a statement of such terms. The
Securities are unsecured general obligations of the Company limited to
$__________ in aggregate principal amount [of which $___________ may only be
issued as 'Additional Securities' on or before the 30th day after the date of,
and pursuant to the terms of, that certain Underwriting Agreement dated
_________, 199_ by and between the Company and _________________. The Company
will not originally issue any Additional
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65
Securities except pursuant to the Underwriting Agreement. If no Additional
Securities are issued the Securities will be limited to $____________ in
aggregate principal amount.] Capitalized terms not defined below have the same
meaning as is given to them in the Indenture.
5[A]. Optional Redemption. The Company may not redeem the Securities
prior to ____________. Thereafter, the Company may redeem all the Securities at
any time or some of them from time to time at the redemption prices (expressed
in percentages of principal amount) set forth below plus accrued interest to the
redemption date, if redeemed during the 12-month period beginning _________ of
the years starting with _____ indicated below.
Year Percentage Year Percentage
and
thereafter 100.000
[5B. Mandatory Redemption. The Company will redeem ___% of the [initial]
principal amount of Securities [(including any Additional Securities)] [then
outstanding] on ____________, and on each _________ thereafter through
___________ at a redemption price of 100% of principal amount, plus accrued
interest to the redemption date. The Company may reduce the principal amount of
Securities to be redeemed pursuant to this paragraph 6 by subtracting 100% of
the principal amount (excluding premium) of any Securities that [Securityholders
have converted,] the Company has delivered to the Trustee for cancellation or
the Company has previously purchased, redeemed, retired or acquired other than
pursuant to this paragraph 6, provided that the Company may so subtract the same
Security only once.]
6. Notice of Redemption. Notice of redemption will be mailed at least
30 days but not more than 60 days before the redemption date to each holder of
Securities to be redeemed at his or her registered address. Securities in
denominations larger than $1,000 may be redeemed in part but only in whole
multiples of $1,000. In the event of a redemption of less than all of the
Securities, the Securities will be chosen for redemption by the Trustee,
generally pro rata or by lot. On and after the redemption date interest ceases
to accrue on Securities or portions of them called for redemption.
If this Security is redeemed subsequent to a record date with respect
to any interest payment date specified above and on or prior to such interest
payment
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66
date, then any accrued interest will be paid to the person in whose name this
Security is registered at the close of business on such record date.
7. Change of Control. Upon a Change of Control, the Company shall make
a Change of Control Offer to purchase all outstanding securities at a price
equal to 101% of the aggregate principal amount of the Securities, plus accrued
and unpaid interest to the date of purchase. To accept the Change of Control
Offer, the Holder hereof must comply with the terms thereof, including
surrendering this Security, with the "Option of Holder to Elect Purchase"
portion hereof completed, to the Company, a depositary, if appointed by the
Company, or a Paying Agent, at the address specified in the notice of the Change
of Control Offer mailed to Holders as provided in the Indenture, prior to
termination of the Change of Control Offer.
8. [Omitted.]
9. Denominations, Transfer, Exchange. The Securities are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Securities may be registered and Securities may be
exchanged as provided in the Indenture. As a condition of transfer, the
Registrar may require a holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not exchange or register
the transfer of any Security or portion of a Security selected for redemption.
Also, it need not exchange or register the transfer of any Securities for a
period of 15 days before a selection of Securities to be redeemed.
10. Persons Deemed Owners. The registered holder of a Security may be
treated as its owner for all purposes.
11. Amendments and Waivers. Subject to certain exceptions, the
Indenture or the Securities may be amended with the consent of the holders of at
least a majority in principal amount of the then outstanding Securities and any
existing default may be waived with the consent of the holders of a majority in
principal amount of the then outstanding Securities. Without the consent of any
Securityholder, the Indenture or the Securities may be amended: to cure any
ambiguity, defect or inconsistency; to provide for assumption of the Company's
obligations to Securityholders; to make any change that does not adversely
affect the rights of any Securityholder; to add to the covenants of the Company,
for the benefit of the Securityholders; or to modify the Indenture to effect its
qualification under the TIA.
12. Defaults and Remedies. An Event of Default is: default for 30 days
in payment of interest on the Securities; default in payment of principal of and
premium, if any, on the Securities; failure by the Company for 60 days after
notice to it to comply with any of its other agreements in the Indenture or the
Securities or, in the case of failure by the Company to maintain its corporate
existence or to
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67
comply with the restrictions on payments of dividends and other distributions,
the restrictions on consolidation, merger or transfer or lease of substantially
all its assets [or the provisions regarding conversion of the Securities], with
such notice but without such passage of time; certain defaults under and
accelerations prior to maturity of certain Indebtedness; certain final judgments
which remain undischarged; and certain events of bankruptcy or insolvency. If an
Event of Default occurs and is continuing, the Trustee or the holders of at
least 25% in principal amount of the then outstanding Securities may declare all
the Securities to be due and payable immediately, except that in the case of an
Event of Default arising from certain events of bankruptcy or insolvency, all
outstanding Securities become due and payable without further action or notice.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may require indemnity satisfactory to it
before it enforces the Indenture or the Securities. Subject to certain
limitations, holders of a majority in principal amount of the then outstanding
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing default
(except a default in payment of principal or interest) if it determines that
withholding notice is in their interests. The Company must furnish an annual
compliance certificate to the Trustee.
13. Trustee Dealings with the Company. [The First National Bank of
Boston], the Trustee under the Indenture, or any of its Affiliates, in their
individual or any other capacities, may make or continue loans to or guaranteed
by, accept deposits from and perform services for the Company or its Affiliates
and may otherwise deal with the Company or its Affiliates as if [The First
National Bank of Boston] were not Trustee.
14. No Recourse Against Others. No director, officer, employee or
stockholder, as such, of the Company shall have any liability for any
obligations of the Company under the Securities or the Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. Each Securityholder by accepting a Security waives and releases all
such liability. The waiver and release are part of the consideration for the
Securities.
15. Authentication. This Security shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
16. Abbreviations. Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as: TEN CO = tenants in common, TEN ENT =
tenants by the entireties, JT TEN = joint tenants with right of survivorship and
not as tenants in common, CUST = Custodian and U/G/M/A = Uniform Gifts to Minors
Act.
The Company will furnish to any Securityholder upon written request and
without charge a copy of the Indenture, which has in it the text of this
Security in larger type. Requests may be made to: Treasurer, Xxx Xxxx
Corporation, 0000 Xxxx Xxxxxxxxx Xxxx, X.X. Xxx 00000, Xxxxxxx, XX 00000.
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68
[17. Conversion. A holder of a Security may convert it into [Preferred]
[Common] Stock of the Company at any time before the close of business on
________,_____. If the Security is called for redemption, the holder may convert
it at any time before the close of business on the redemption date (unless the
Company shall default in payment due upon redemption thereof). The initial
conversion price of $__ per share is subject to adjustment in certain events. To
determine the number of shares issuable upon conversion of a Security, divide
the principal amount to be converted by the conversion price in effect on the
conversion date. On conversion, no payment or adjustment for interest will be
made. However, interest will be paid on any interest payment date with respect
to Securities surrendered for conversion after a record date for the payment of
interest to the registered holder on such record date. The Company will deliver
a check for any fractional share.
To convert a Security a holder must (1) complete and sign the
conversion notice on the back of the Security, (2) surrender the Security to a
Conversion Agent, (3) furnish appropriate endorsements and transfer documents if
required by the Registrar or Conversion Agent and (4) pay any transfer or
similar tax if required by the Indenture or applicable law. A holder may convert
a portion of a Security if the portion is $1,000 or an integral multiple of
$1,000.
The conversion price is subject to adjustment as set forth in the
Indenture in certain events. No adjustment in the conversion price will be
required unless such adjustment would require a change of at least 1% in the
price then in effect; but any adjustment that would otherwise be required to be
made shall be carried forward and taken into account in any subsequent
adjustment.
The Company from time to time may voluntarily reduce the conversion
price for a period of time.
If the Company is a party to a consolidation or merger or a transfer or
lease of all or substantially all of its assets, the Securities automatically
become convertible into the kind and amount of securities, cash or other assets
which the Holder of a Security would have owned immediately after such
transaction if the Holder had converted the Security immediately before the
effective date of the transaction.]
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69
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to:
(Insert assignee's soc. sec.
or tax I.D. no.)
________________________________________
________________________________________
________________________________________
________________________________________
(Print or type assignee's name, address
and zip code)
and irrevocably appoint:
________________________________________
agent to transfer this Security on the
books of the Company. The agent may
substitute another to act for him or her.
Date:
Signature Guarantee:
[CONVERSION NOTICE
To convert this Security into [Preferred]
[Common] Stock of the Company, check the box:
To convert only part of this Security, state
the amount:
$
If you want the stock certificate made out in
another person's name, fill in the form below:
(insert other person's soc. sec. or tax I.D. no.)
__________________________________________
__________________________________________
__________________________________________
__________________________________________
(Print or type other person's name, address
and zip code.)
Your signature:
__________________________________________
(Sign exactly as your name appears on the
other side of this Security)]
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70
[OPTION OF HOLDER TO ELECT PURCHASE]
If you want to elect to have this Security purchased by the Company
pursuant to Section 4.11 of the Indenture and paragraph 7 of this Security,
check the box: [ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to Section 4.11 of the Indenture and paragraph 7 of this
Security, state the amount: $___________
Date:_________________ Your Signature:____________________________
(Sign exactly as your name
appears on the other side of
this Security)]
Signature Guarantee:
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