1
EXHIBIT 4.1
-----------------------------------------------------------------------
ALCATEL USA, INC., ISSUER
(FORMERLY, DSC COMMUNICATIONS CORPORATION)
ALCATEL, GUARANTOR
AND
THE BANK OF NEW YORK, TRUSTEE
----------------
INDENTURE
DATED AS OF AUGUST 12, 1997
AS SUPPLEMENTED BY THE FIRST SUPPLEMENTAL INDENTURE, DATED AS OF
SEPTEMBER 4, 1998 AND AS FURTHER SUPPLEMENTED BY THE SECOND
SUPPLEMENTAL INDENTURE, DATED AS OF APRIL 1, 1999
----------------
U.S.$400,000,000
7% CONVERTIBLE SUBORDINATED NOTES
DUE AUGUST 1, 2004
[RESTATED AS SUPPLEMENTED FOR INFORMATIONAL PURPOSES ONLY]
-----------------------------------------------------------------------
2
TABLE OF CONTENTS
Page
----
RECITALS OF THE COMPANY.........................................................
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION..........................................................
SECTION 1.1. Definitions...................................................... 1
Act.................................................................. 2
Affiliate............................................................ 2
Agent Member......................................................... 2
Alcatel.............................................................. 2
Alcatel ADSs......................................................... 2
Applicable Procedures................................................ 3
Authenticating Agent................................................. 3
Authorized Newspaper................................................. 3
Board of Directors................................................... 3
Board Resolution..................................................... 3
Business Day......................................................... 3
CEDEL................................................................ 3
Change in Control.................................................... 3
Closing Price Per Alcatel ADS........................................ 3
Code................................................................. 3
Commission........................................................... 4
Common Stock......................................................... 4
Common stock......................................................... 4
Company.............................................................. 4
Company Notice....................................................... 4
Company Request or Company Order..................................... 4
Constituent Person................................................... 4
Conversion Agent..................................................... 4
Conversion Price..................................................... 4
Conversion Rate...................................................... 4
Corporate Trust Office............................................... 4
Corporation.......................................................... 4
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
i
3
Page
----
Defaulted Interest................................................... 4
Depositary........................................................... 5
Dollar or U.S.$...................................................... 5
DTC.................................................................. 5
Euroclear............................................................ 5
Event of Default..................................................... 5
Exchange Act......................................................... 5
Exchange Date........................................................ 5
Global Security...................................................... 5
Holder............................................................... 5
Indenture............................................................ 5
Initial Purchasers................................................... 5
Interest Payment Date................................................ 5
Liquidated Damages................................................... 5
Maturity............................................................. 5
Non-electing Alcatel ADS............................................. 6
Notice of Default.................................................... 6
Officers' Certificate................................................ 6
Opinion of Counsel................................................... 6
Outstanding.......................................................... 6
Paying Agent......................................................... 7
Person............................................................... 7
Place of Conversion.................................................. 7
Place of Payment..................................................... 7
Predecessor Security................................................. 7
Purchase Agreement................................................... 7
Record Date.......................................................... 7
Record Date Period................................................... 7
Redemption Date...................................................... 7
Redemption Price..................................................... 7
Registered Security.................................................. 7
Registrable Securities............................................... 7
Regular Record Date.................................................. 8
Regulation S......................................................... 8
Regulation S Certificate............................................. 8
Regulation S Global Security......................................... 8
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
ii
4
Page
----
Regulation S Legend.................................................. 8
Regulation S Securities.............................................. 8
Repurchase Date...................................................... 8
Repurchase Price..................................................... 8
Responsible Officer.................................................. 8
Restricted Global Security........................................... 8
Restricted Period.................................................... 8
Restricted Securities................................................ 8
Restricted Securities Certificate.................................... 8
Restricted Securities Legend......................................... 9
Rule 144A............................................................ 9
Rule 144A Information................................................ 9
Rule 144A Securities................................................. 9
Securities........................................................... 9
Securities Act....................................................... 9
Securities Act Legend................................................ 9
Security Register and Security Registrar............................. 9
Senior Indebtedness.................................................. 9
Shelf Registration Statement........................................ 10
Special Record Date................................................. 10
Stated Maturity..................................................... 10
Subsidiary.......................................................... 10
Successor Security.................................................. 10
Surrender Certificate............................................... 10
Trading Days........................................................ 10
Trust Indenture Act................................................. 11
Trustee............................................................. 11
United States....................................................... 11
Unrestricted Securities Certificate................................. 11
Vice President...................................................... 11
SECTION 1.2.
Compliance Certificates and Opinions................................ 11
SECTION 1.3.
Form of Documents Delivered to the Trustee.......................... 12
SECTION 1.4.
Acts of Holders of Securities....................................... 12
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
iii
5
Page
----
SECTION 1.5.
Notices, Etc., to Trustee and Company............................... 14
SECTION 1.6.
Notice to Holders of Securities; Waiver............................. 15
SECTION 1.7.
Effect of Headings and Table of Contents............................ 15
SECTION 1.8.
Successors and Assigns.............................................. 15
SECTION 1.9.
Separability Clause................................................. 16
SECTION 1.10.
Benefits of Indenture............................................... 16
SECTION 1.11.
Governing Law....................................................... 16
SECTION 1.12.
Legal Holidays...................................................... 16
SECTION 1.13.
Conflict with Trust Indenture Act................................... 16
ARTICLE TWO
SECURITY FORMS...................................................... 17
SECTION 2.1.
Form Generally...................................................... 17
SECTION 2.2.
Form................................................................ 18
SECTION 2.3.
Form of Certificate of Authentication............................... 33
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
iv
6
Page
----
SECTION 2.4.
Form of Conversion Notice........................................... 33
ARTICLE THREE
THE SECURITIES...................................................... 35
SECTION 3.1.
Title and Terms..................................................... 35
SECTION 3.2.
Denominations....................................................... 35
SECTION 3.3.
Execution, Authentication, Delivery and Dating...................... 36
SECTION 3.4.
Global Securities................................................... 36
SECTION 3.5.
Registration, Registration of Transfer and Exchange;
Restrictions on Transfer....................................... 36
SECTION 3.6.
Mutilated, Destroyed, Lost or Stolen Securities..................... 42
SECTION 3.7.
Payment of Interest; Interest Rights Preserved...................... 42
SECTION 3.8.
Persons Deemed Owners............................................... 44
SECTION 3.9.
Cancellation........................................................ 44
SECTION 3.10.
Computation of Interest............................................. 44
SECTION 3.11.
[Reserved].......................................................... 44
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
v
7
Page
----
SECTION 3.12.
CUSIP Numbers....................................................... 44
ARTICLE FOUR
SATISFACTION AND DISCHARGE.......................................... 44
SECTION 4.1.
Satisfaction and Discharge of Indenture............................. 44
SECTION 4.2.
Application of Trust Money.......................................... 46
ARTICLE FIVE
REMEDIES............................................................ 46
SECTION 5.1.
Events of Default................................................... 46
SECTION 5.2.
Acceleration of Maturity; Rescission and Annulment.................. 47
SECTION 5.3.
Collection of Indebtedness and Suits for Enforcement by Trustee..... 48
SECTION 5.4.
Trustee May File Proofs of Claim.................................... 49
SECTION 5.5.
Trustee May Enforce Claims Without Possession of Securities......... 50
SECTION 5.6.
Application of Money Collected...................................... 50
SECTION 5.7.
Limitation on Suits................................................. 51
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture
vi
8
Page
----
SECTION 5.8.
Unconditional Right of Holders to Receive Principal, Premium and
Interest and to Convert............................................. 51
SECTION 5.9.
Restoration of Rights and Remedies.................................. 51
SECTION 5.10.
Rights and Remedies Cumulative...................................... 52
SECTION 5.11.
Delay or Omission Not Waiver........................................ 52
SECTION 5.12.
Control by Holders of Securities.................................... 52
SECTION 5.13.
Waiver of Past Defaults............................................. 52
SECTION 5.14.
Undertaking for Costs............................................... 53
SECTION 5.15.
Waiver of Stay, Usury or Extension Laws............................. 53
ARTICLE SIX
THE TRUSTEE......................................................... 54
SECTION 6.1.
Certain Duties and Responsibilities................................. 54
SECTION 6.2.
Notice of Defaults.................................................. 55
SECTION 6.3.
Certain Rights of Trustee........................................... 55
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture
vii
9
Page
----
SECTION 6.4.
Not Responsible for Recitals or Issuance of Securities.............. 56
SECTION 6.5.
May Hold Securities, Act as Trustee Under Other Indentures.......... 56
SECTION 6.6.
Money Held in Trust................................................. 57
SECTION 6.7.
Compensation and Reimbursement...................................... 57
SECTION 6.8.
Corporate Trustee Required; Eligibility............................. 57
SECTION 6.9.
Resignation and Removal; Appointment of Successor................... 59
SECTION 6.10.
Acceptance of Appointment by Successor.............................. 59
SECTION 6.11.
Merger, Conversion, Consolidation or Succession to Business......... 59
SECTION 6.12.
Authenticating Agents............................................... 60
SECTION 6.13.
Disqualification; Conflicting Interests............................. 61
SECTION 6.14.
Preferential Collection of Claims Against Company................... 61
ARTICLE SEVEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE................ 61
SECTION 7.1.
Company May Consolidate, Etc., Only on Certain Terms................ 62
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture
viii
10
Page
----
SECTION 7.2.
Successor Substituted............................................... 62
ARTICLE EIGHT
SUPPLEMENTAL INDENTURES............................................. 63
SECTION 8.1.
Supplemental Indentures Without Consent of Holders of Securities... 63
SECTION 8.2.
Supplemental Indentures With Consent of Holders of Securities....... 64
SECTION 8.3.
Execution of Supplemental Indentures................................ 65
SECTION 8.4.
Effect of Supplemental Indentures................................... 66
SECTION 8.5.
Reference in Securities to Supplemental Indentures.................. 66
SECTION 8.6.
Notice of Supplemental Indentures................................... 66
ARTICLE NINE
MEETINGS OF HOLDERS OF SECURITIES................................... 66
SECTION 9.1.
Purposes for Which Meetings May Be Called........................... 66
SECTION 9.2.
Call, Notice and Place of Meetings.................................. 66
SECTION 9.3.
Persons Entitled to Vote at Meetings................................ 66
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
ix
11
Page
----
SECTION 9.4.
Quorum; Action...................................................... 66
SECTION 9.5.
Determination of Voting Rights; Conduct and Adjournment of Meetings. 67
SECTION 9.6.
Counting Votes and Recording Action of Meetings..................... 67
ARTICLE TEN
COVENANTS........................................................... 68
SECTION 10.1.
Payment of Principal, Premium and Interest.......................... 68
SECTION 10.2.
Maintenance of Offices or Agencies.................................. 69
SECTION 10.3.
Money for Security Payments To Be Held in Trust..................... 69
SECTION 10.4.
[Reserved].......................................................... 70
SECTION 10.5.
Existence........................................................... 71
SECTION 10.6.
Maintenance of Properties........................................... 71
SECTION 10.7.
Payment of Taxes and Other Claims................................... 71
SECTION 10.8.
Registration and Listing............................................ 71
SECTION 10.9.
Statement by Officers as to Default................................. 72
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
x
12
Page
----
SECTION 10.10.
Delivery of Certain Information..................................... 72
SECTION 10.11.
Resale of Certain Securities; Reporting Issuer...................... 73
SECTION 10.12.
Registration Rights................................................. 73
SECTION 10.13.
Waiver of Certain Covenants......................................... 74
ARTICLE ELEVEN
REDEMPTION OF SECURITIES........................................... 75
SECTION 11.1.
Right of Redemption................................................. 75
SECTION 11.2.
Applicability of Article............................................ 75
SECTION 11.3.
Election to Redeem; Notice to Trustee............................... 75
SECTION 11.4.
Selection by Trustee of Securities To Be Redeemed................... 75
SECTION 11.5.
Notice of Redemption................................................ 76
SECTION 11.6.
Deposit of Redemption Price......................................... 77
SECTION 11.7.
Securities Payable on Redemption Date............................... 77
SECTION 11.8.
Securities Redeemed in Part......................................... 78
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
xi
13
Page
----
ARTICLE TWELVE
CONVERSION OF SECURITIES............................................ 78
SECTION 12.1.
Conversion Privilege and Conversion Price........................... 78
SECTION 12.2.
Exercise of Conversion Privilege.................................... 78
SECTION 12.3.
Fractions of Alcatel ADSs........................................... 80
SECTION 12.4.
Adjustment of Conversion Price...................................... 80
SECTION 12.5.
Notice of Adjustments of Conversion Price........................... 85
SECTION 12.6.
Notice of Certain Corporate Action.................................. 85
SECTION 12.7.
Company to Reserve Common Stock..................................... 86
SECTION 12.8.
Taxes on Conversions................................................ 86
SECTION 12.9.
Covenant as to Alcatel ADSs......................................... 86
SECTION 12.10.
Cancellation of Converted Securities................................ 87
SECTION 12.11.
Provision in Case of Consolidation, Merger or Sale of Assets........ 87
SECTION 12.12.
Responsibility of Trustee for Conversion Provisions................. 88
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
xii
14
Page
----
ARTICLE THIRTEEN
SUBORDINATION OF SECURITIES......................................... 81
SECTION 13.1.
Securities Subordinate to Senior Indebtedness....................... 81
SECTION 13.2.
Payment Over of Proceeds Upon Dissolution, Etc...................... 89
SECTION 13.3.
No Payment When Senior Indebtedness in Default...................... 90
SECTION 13.4.
Payment Permitted If No Default..................................... 90
SECTION 13.5.
Subrogation to Rights of Holders of Senior Indebtedness............. 90
SECTION 13.6.
Provisions Solely to Define Relative Rights......................... 91
SECTION 13.7.
Trustee to Effectuate Subordination................................. 91
SECTION 13.8.
No Waiver of Subordination Provisions............................... 91
SECTION 13.9.
Notice to Trustee................................................... 92
SECTION 13.10.
Reliance on Judicial Order or Certificate of Liquidating Agent...... 93
SECTION 13.11.
Trustee Not Fiduciary for Holders of Senior Indebtedness............ 93
SECTION 13.12.
Reliance by Holders of Senior Indebtedness on Subordination
Provisions..................................................... 93
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
xiii
15
Page
----
SECTION 13.13.
Rights of Trustee as Holder of Senior Indebtedness; Preservation
of Trustee's Rights............................................ 93
SECTION 13.14.
Article Applicable to Paying Agents................................. 93
SECTION 13.15.
Certain Conversions and Repurchases Deemed Payment.................. 94
ARTICLE FOURTEEN
REPURCHASE OF SECURITIES AT THE OPTION OF THE
HOLDER UPON A CHANGE IN CONTROL..................................... 94
SECTION 14.1.
Right to Require Repurchase......................................... 94
SECTION 14.2.
Conditions to the Company's Election to Pay the Repurchase Price
in Alcatel ADSs................................................. 95
SECTION 14.3.
Notices; Method of Exercising Repurchase Right, Etc................. 96
SECTION 14.4.
Certain Definitions................................................. 99
ARTICLE FIFTEEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY;
NON-RECOURSE....................................................... 100
SECTION 15.1.
Company to Furnish Trustee Names and Addresses of Holders.......... 100
SECTION 15.2.
Preservation of Information........................................ 100
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
xiv
16
Page
----
SECTION 15.3.
No Recourse Against Others......................................... 101
SECTION 15.4.
Reports by Trustee................................................. 101
SECTION 15.5.
Reports by Company................................................. 101
ARTICLE SIXTEEN
THE GUARANTY....................................................... 101
SECTION 16.1
Guaranty........................................................... 101
TESTIMONIUM........................................................ 102
SIGNATURES AND SEALS................................................ NA
ACKNOWLEDGMENTS....................................................
ANNEX I............................................................ I-I
ANNEX A............................................................ A-I
ANNEX B............................................................ B-I
ANNEX C............................................................ C-I
ANNEX D............................................................ D-I
Note: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
xv
17
This Indenture is dated as of August 12, 1997, between Alcatel USA, Inc.,
formerly DSC Communications Corporation, a Delaware corporation, having its
principal office at 0000 Xxxx Xxxx, Xxxxx, Xxxxx 00000 (herein called the
"Company"); Alcatel, a French societe anonyme ("Alcatel" or the "Guarantor");
and The Bank of New York, a New York banking corporation as Trustee hereunder
(herein called the "Trustee").
WHEREAS, the Company has heretofore executed and delivered to the
Trustee an Indenture, dated as of August 12, 1997 (the "Initial Indenture"),
providing for the creation and issuance by the Company of 7% Convertible
Subordinated Notes due August 1, 2004, which has been supplemented by the First
Supplemental Indenture, dated as of September 4, 1998, between the Company and
the Trustee (the "First Supplemental Indenture") and the Second Supplemental
Indenture, dated as of April 1, 1999, between the Company, Alcatel and the
Trustee (the "Second Supplemental Indenture", together with the Initial
Indenture and the First Supplemental Indenture, the "Indenture");
WHEREAS, the Company, Alcatel and the Bank of New York have restated
the original indenture for informational purposes only to reflect the
modifications thereto resulting from the execution of the First Supplemental
Indenture and the Second Supplemental Indenture (the "Amended and Restated
Indenture" or the "Indenture");
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its 7%
Convertible Subordinated Notes due August 1, 2004 (herein called the
"Securities") of substantially the tenor and amount hereinafter set forth, and
to provide therefor the Company has duly authorized the execution and delivery
of this Indenture.
All things necessary to make the Securities, when the Securities are
executed by the Company and authenticated and delivered hereunder, the valid
obligations of the Company, and to make this Indenture a valid agreement of the
Company, in accordance with their and its terms, have been done. Further, all
things necessary to duly authorize the delivery of the Alcatel ADSs deliverable
upon the conversion of the Securities have been done.
RECITALS OF ALCATEL
Alcatel has duly executed and delivered the Guaranty dated as of
September 17, 1998, a copy of which is attached hereto as Annex I (the
"Guaranty");
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities, as follows:
18
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1. Definitions.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles in
the United States, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as are
generally accepted at the date of such computation; and
(3) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"Act", when used with respect to any Holder of a Security, has the
meaning specified in Section 1.4.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent Member" means any member of, or participant in, the Depositary.
"Alcatel" means Alcatel, a company organized under the laws of the
Republic of France, and the parent of the Company.
"Alcatel ADSs" means the American depositary shares issued under the
depositary agreement, dated as of March 1, 1991 and amended and restated as of
March 15, 1992, as amended by Amendment No. 1 dated as of January 3, 1997 and as
further amended and restated as of March 10, 1997, among Alcatel, The Bank of
New York, as depositary, and holders of American depositary receipts evidencing
such American depositary shares, each representing one-fifth of one ordinary
share of Alcatel.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of Euroclear and
2
19
CEDEL, and of the Depositary for such Security, in each case to the extent
applicable to such transaction and as in effect from time to time.
"Authenticating Agent" means any Person authorized pursuant to Section
6.12 to act on behalf of the Trustee to authenticate Securities.
"Authorized Newspaper" means a newspaper in the English language,
customarily published on each Monday, Tuesday, Wednesday, Thursday and Friday,
whether or not published on Saturdays, Sundays or holidays, and of general
circulation in a Place of Payment.
"Board of Directors" means either the board of directors of the Company
or any duly authorized committee of that board empowered to act for it with
respect to this Indenture.
"Board Resolution" means a resolution duly adopted by the Board of
Directors, a copy of which, certified by the Secretary or an Assistant Secretary
of the Company to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, shall have been
delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment, Place
of Conversion or any other place, as the case may be, means each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions in such Place of Payment, Place of Conversion or other place, as
the case may be, are authorized or obligated by law or executive order to close;
provided, however, that a day on which banking institutions in New York, New
York are authorized or obligated by law or executive order to close shall not be
a Business Day for purposes of Section 13.9; provided, further, that a day on
which banking institutions in New York, New York are authorized or obligated by
law or executive order to close shall not be a Business Day for purposes of
Section 11.6.
"CEDEL" means Cedel Bank, S.A. (or any successor securities clearing
agency).
"Change in Control" has the meaning specified in Section 14.4(b).
"Closing Price Per Alcatel ADS" means, with respect to the Alcatel
ADSs, for any day, (i) the closing bid price regular way on the Nasdaq National
Market or, (ii) if the Alcatel ADSs are not quoted on the Nasdaq National
Market, the reported last sales price regular way per Alcatel ADS or, in case no
such reported sale takes place on such day, the average of the reported closing
bid and asked prices regular way, in either case, on the principal national
securities exchange on which the Alcatel ADSs are listed or admitted to trading,
or (iii) if the Alcatel ADSs are not quoted on the Nasdaq National Market or
listed or admitted to trading on any national securities exchange, the average
of the closing bid prices in the over-the-counter market as furnished by any New
York Stock Exchange member firm selected from time to time by Alcatel for that
purpose.
"Code" has the meaning specified in Section 2.1.
3
20
"Commission" means the United States Securities and Exchange
Commission, as from time to time constituted, created under the Exchange Act,
or, if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Common Stock", unless otherwise stated, means the Common Stock of
Alcatel, nominal value EUR 10 per share.
"Common stock" includes any stock of any class of capital stock which
has no preference in respect of dividends or of amounts payable in the event of
any voluntary or involuntary liquidation, dissolution or winding up of the
issuer thereof and which is not subject to redemption by the issuer thereof.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Notice" has the meaning specified in Section 14.3.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its Chief Executive Officer, its President or a Vice
President, and by its principal financial officer, Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Constituent Person" has the meaning specified in Section 12.11.
"Conversion Agent" means any Person authorized by the Company to
convert Securities in accordance with Article Twelve. The Company has initially
appointed the Trustee as its Conversion Agent in the Borough of Manhattan, The
City of New York.
"Conversion Price" has the meaning specified in Section 14.4(c).
"Conversion Rate" has the meaning specified in Section 12.1.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally
administered (which at the date of this Indenture is located at 000 Xxxxxxx Xx.,
Xxxxx 00 Xxxx, Xxx Xxxx, Xxx Xxxx 10286).
"Corporation" means a corporation or company, including without
limitation a limited liability company, an association, joint-stock company or
business trust.
"Defaulted Interest" has the meaning specified in Section 3.7.
4
21
"Depositary" means, with respect to any Registered Securities, a
clearing agency that is registered as such under the Exchange Act and is
designated by the Company to act as Depositary for such Registered Securities
(or any successor securities clearing agency so registered).
"Dollar" or "U.S.$" means a dollar or other equivalent unit in such
coin or currency of the United States as at the time shall be legal tender for
the payment of public and private debts.
"DTC" means The Depository Trust Company, a New York corporation.
"Euroclear" means the Euroclear Clearance System (or any successor
securities clearing agency).
"Event of Default" has the meaning specified in Section 5.1.
"Exchange Act" means the United States Securities Exchange Act of 1934
(or any successor statute), as amended from time to time.
"Exchange Date" means the date and day on which the Restricted Period
expires.
"Global Security" means a Registered Security that is registered in the
Security Register in the name of a Depositary or a nominee thereof.
"Holder" means the Person in whose name the Security is registered in
the Security Register.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.
"Initial Purchasers" means Xxxxxxx, Sachs & Co., NationsBanc Capital
Markets, Inc. and Xxxxxxx Xxxxx International, collectively.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.
"Liquidated Damages" has the meaning specified in Section 10.12.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption, exercise of the repurchase right set forth in
Article Fourteen or otherwise.
5
22
"Non-electing Alcatel ADS" has the meaning specified in Section 12.11.
"Notice of Default" has the meaning specified in Section 5.1.
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, a Vice Chairman of the Board, the Chief Executive Officer, the
President or a Vice President and by the principal financial officer, the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
the Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company and who shall be acceptable to the Trustee.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(i) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Securities for the payment or redemption of which money in the
necessary amount has been theretofore deposited with the Trustee or any Paying
Agent (other than the Company) in trust or set aside and segregated in trust by
the Company (if the Company shall act as its own Paying Agent) for the Holders
of such Securities, provided that if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made; and
(iii) Securities which have been paid pursuant to Section 3.6 or in
exchange for or in lieu of which other Securities have been authenticated and
delivered pursuant to this Indenture, other than any such Securities in respect
of which there shall have been presented to the Trustee proof satisfactory to it
that such Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company; provided, however, that in
determining whether the Holders of the requisite principal amount of Outstanding
Securities are present at a meeting of Holders of Securities for quorum purposes
or have given any request, demand, authorization, direction, notice, consent or
waiver hereunder, Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or such other obligor shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such determination as
to the presence of a quorum or upon any such request, demand, authorization,
direction, notice, consent or waiver, only Securities which a Responsible
Officer of the Trustee actually knows to be so owned shall be so disregarded.
Securities so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Securities and that the pledgee
is not the Company or any other obligor upon the Securities or any Affiliate of
the Company or such other obligor.
6
23
"Paying Agent" means any Person authorized by the Company to pay the
principal of or interest on any Securities on behalf of the Company and, except
as otherwise specifically set forth herein, such term shall include the Company
if it shall act as its own Paying Agent. The Company has initially appointed the
Trustee as its Paying Agent in the Borough of Manhattan, The City of New York.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, trust, estate, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Conversion" has the meaning specified in Section 3.1.
"Place of Payment" has the meaning specified in Section 3.1.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.6 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Purchase Agreement" means the Purchase Agreement, dated as of August
7, 1997, between the Company and the Initial Purchasers, as such agreement may
be amended from time to time.
"Record Date" means any Regular Record Date or Special Record Date.
"Record Date Period" means the period from the close of business of any
Regular Record Date next preceding any Interest Payment Date to the opening of
business on such Interest Payment Date.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Registered Security" means any Security issued in substantially the
form set forth in Section 2.2 and registered in the Security Register. A Global
Security is a Registered Security.
"Registrable Securities" has the meaning specified in Section 10.12.
"Registration Default" has the meaning specified in Section 10.12.
"Registration Rights Agreement" has the meaning specified in
Section 2.2.
7
24
"Regular Record Date" for interest payable in respect of any Registered
Security on any Interest Payment Date means the January 15 or July 15 (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date.
"Regulation S" means Regulation S under the Securities Act (or any
successor provision), as it may be amended from time to time.
"Regulation S Certificate" means a certificate substantially in the
form set forth in Annex A.
"Regulation S Global Security" has the meaning specified in
Section 2.1.
"Regulation S Legend" means a legend substantially in the form of the
legend required in the form of Security set forth in Section 2.2 to be placed
upon a Regulation S Global Security.
"Regulation S Securities" means all Securities required pursuant to
Section 3.5(c) to bear a Regulation S Legend. Such term includes the Regulation
S Global Security.
"Repurchase Date" has the meaning specified in Section 14.1.
"Repurchase Price" has the meaning specified in Section 14.1.
"Responsible Officer", when used with respect to the Trustee, means any
officer within the Corporate Trust Office of the Trustee including without
limitation any vice president, assistant vice president, assistant treasurer,
assistant secretary, corporate trust officer, assistant corporate trust officer
or other employee of the Trustee customarily performing functions similar to
those performed by any of the above designated officers and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of his knowledge and familiarity with the particular
subject.
"Restricted Global Security" has the meaning specified in Section 2.1.
"Restricted Period" means the period of 41 consecutive days beginning
on and including the later of (i) the day on which Securities are first offered
to persons other than distributors (as defined in Regulation S) in reliance on
Regulation S and (ii) the last original issuance date of the Securities.
"Restricted Securities" means all Securities required pursuant to
Section 3.5(c) to bear any Restricted Securities Legend. Such term includes the
Restricted Global Security.
"Restricted Securities Certificate" means a certificate substantially
in the form set forth in Annex B.
8
25
"Restricted Securities Legend" means, collectively, the legends
substantially in the forms of the legends required in the form of Security set
forth in Section 2.2 to be placed upon each Restricted Security.
"Rule 144A" means Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.
"Rule 144A Information" has the meaning specified in Section 10.10.
"Rule 144A Securities" means the Securities purchased by the Initial
Purchaser from the Company pursuant to the Purchase Agreement and resold by the
Initial Purchaser, other than the Regulation S Securities.
"Securities" has the meaning ascribed to it in the first paragraph
under the caption "Recitals of the Company".
"Securities Act" means the United States Securities Act of 1933 (or any
successor statute), as amended from time to time.
"Securities Act Legend" means a Restricted Securities Legend or a
Regulation S Legend.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 3.5.
"Senior Indebtedness" means the principal of (and premium, if any) and
interest (including all interest accruing subsequent to the filing of a petition
initiating any proceeding under city, state, federal or foreign bankruptcy laws,
whether or not allowable as a claim in any such proceeding) on, and all fees and
other amounts payable in connection with, the following, whether absolute or
contingent, secured or unsecured, due or to become due, outstanding on the date
of the Indenture or thereafter created, incurred or assumed: (a) indebtedness of
the Company evidenced by credit or loan agreements, notes, bonds, debentures, or
other written obligations, including, but not limited to as of June 30, 1997 the
Company's five-year, unsecured $160.0 million revolving credit facility with
several banks, $168.8 million outstanding principal amount of the Company's 9.0%
unsecured notes which mature from 1997 to 2003, $10.8 million outstanding
principal amount of the Company's 8.75% unsecured notes which mature from 1997
to 2000 and $83.0 million outstanding principal amount of the Company's variable
rate unsecured notes which mature from 1999 to 2011, (b) all obligations of the
Company for money borrowed, (c) all obligations of the Company evidenced by a
note or similar instrument given in connection with the acquisition of any
businesses, properties or assets of any kind, (d) obligations of the Company as
lessee under leases required to be capitalized on the balance sheet of the
lessee under generally accepted accounting principles, (e) obligations of the
Company under interest rate and currency swaps, caps, floors, collars, hedge
agreements, forward contracts, or similar agreements or arrangements intended to
protect the Company against fluctuations in interest
9
26
or currency exchange rates, (f) all obligations of the type referred to in
clauses (a) through (e) above of another Person and all dividends of another
Person, the payment of which, in either case, the Company has assumed or
guaranteed, or for which the Company is responsible or liable, directly or
indirectly, jointly or severally, as obligor, guarantor or otherwise, or which
is secured by a lien on property of the Company, and (g) renewals, extensions,
modifications, replacements, restatements and refundings of, or any indebtedness
or obligation issued in exchange for, any such indebtedness or obligation
described in clauses (a) through (f) of this paragraph; provided, however, that
Senior Indebtedness shall not include the Securities or any such indebtedness or
obligation (a) if the terms of such indebtedness or obligation (or the terms of
the instrument under which, or pursuant to which it is issued) provide that such
indebtedness or obligation is not superior in right of payment to the
Securities, (b) if such indebtedness or obligation is non-recourse to the
Company or (c) if such indebtedness or obligation is a conditional sale contract
or any account payable or any other indebtedness created or assumed by the
Company in the ordinary course of business in connection with the obtaining of
inventories or services.
"Shelf Registration Statement" has the meaning specified in
Section 10.12.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Company pursuant to Section 3.7.
"Stated Maturity", when used with respect to any Security or any
installment of interest thereon, means the date specified in such Security as
the fixed date on which the principal of such Security or such installment of
interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For the purposes of this definition, "voting stock" means stock or
other similar interests in the corporation which ordinarily has or have voting
power for the election of directors, or persons performing similar functions,
whether at all times or only so long as no senior class of stock or other
interests has or have such voting power by reason of any contingency.
"Successor Security" of any particular Security means every Security
issued after, and evidencing all or a portion of the same debt as that evidenced
by, such particular Security; and, for the purposes of this definition, any
Security authenticated and delivered under Section 3.6 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Surrender Certificate" means a certificate substantially in the form
set forth in Annex D.
"Trading Days" means (i) if the Alcatel ADSs are quoted on the Nasdaq
National Market or any other system of automated dissemination of quotations of
securities prices, days on which trades may be effected through such system;
(ii) if the Alcatel ADSs are listed or admitted for trading on any national
securities exchange, days on which such national
10
27
securities exchange is open for business; or (iii) if the Alcatel ADSs are not
listed or admitted for trading on any national securities exchange or quoted on
the Nasdaq National Market or any other system of automated dissemination of
quotation of securities prices, days on which the Alcatel ADSs are traded
regular way in the over-the-counter market and for which a closing bid and a
closing asked price for the Alcatel ADSs are available.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force
at the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"United States" means the United States of America (including the
States and the District of Columbia), its territories, its possessions and other
areas subject to its jurisdiction (its "possessions" including Puerto Rico, the
U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana
Islands).
"Unrestricted Securities Certificate" means a certificate substantially
in the form set forth in Annex C.
"Vice President", when used with respect to the Company, means any vice
president, whether or not designated by a number or a word or words added before
or after the title "vice president".
SECTION 1.2. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (including certificates
provided for in Section 10.9) shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein relating
thereto;
11
28
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he has made
such examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 1.3. Form of Documents Delivered to the Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which such certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company or any other Person
stating that the information with respect to such factual matters is in the
possession of the Company or such other Person, unless such counsel knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4. Acts of Holders of Securities.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided or permitted by this Indenture to be given or
taken by Holders of Securities may be embodied in and evidenced by (1) one or
more instruments of substantially similar tenor signed by such Holders in person
or by an agent or proxy duly appointed in writing by such Holders or (2) the
record of Holders of Securities voting in favor thereof, either in person or by
proxies duly appointed in writing, at any meeting of Holders of Securities duly
called and held in accordance with the provisions of Article Nine. Such action
shall become effective when such instrument or instruments or record is
delivered to the Trustee and, where it is hereby expressly required, to the
Company. The Trustee shall promptly deliver to the Company copies of all such
instruments and records delivered to the Trustee. Such
12
29
instrument or instruments and record (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
of Securities signing such instrument or instruments and so voting at such
meeting. Proof of execution of any such instrument or of a writing appointing
any such agent or proxy, or of the holding by any Person of a Security, shall be
sufficient for any purpose of this Indenture and (subject to Section 6.1)
conclusive in favor of the Trustee and the Company if made in the manner
provided in this Section. The record of any meeting of Holders of Securities
shall be proved in the manner provided in Section 9.6.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority.
(c) The principal amount and serial number of any Registered Security
held by any Person, and the date of his holding the same, shall be proved by the
Security Register.
(d) The fact and date of execution of any such instrument or writing
and the authority of the Person executing the same may also be proved in any
other manner which the Trustee deems sufficient; and the Trustee may in any
instance require further proof with respect to any of the matters referred to in
this Section 1.4.
(e) The Company may set any day as the record date for the purpose of
determining the Holders entitled to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action, or to vote on
any action, authorized or permitted by this Indenture to be given or taken by
Holders. Promptly and in any case not later than ten days after setting a record
date, the Company shall notify the Trustee and the Holders of such record date.
If not set by the Company prior to the first solicitation of a Holder made by
any Person in respect of any such action, or, in the case of any such vote,
prior to such vote, the record date for any such action or vote shall be the
30th day (or, if later, the date of the most recent list of Holders required to
be provided pursuant to Section 15.1) prior to such first solicitation or vote,
as the case may be. With regard to any record date, the Holders on such date (or
their duly appointed agents or proxies), and only such Persons, shall be
entitled to give or take, or vote on, the relevant action, whether or not such
Holders remain Holders after such record date. Notwithstanding the foregoing,
the Company shall not set a record date for, and the provisions of this
paragraph shall not apply with respect to, any notice, declaration or direction
referred to in the next paragraph.
Upon receipt by the Trustee from any Holder of (i) any notice of
default or breach referred to in Section 5.1(4), if such default or breach has
occurred and is continuing and the Trustee shall not have given such a notice to
the Company, (ii) any declaration of acceleration referred to in Section 5.2, if
an Event of Default has occurred and is continuing and the Trustee shall not
have given such a declaration to the Company, or (iii) any direction referred to
in Section 5.12, if the Trustee shall not have taken the action specified in
such direction,
13
30
then, with respect to clauses (ii) and (iii), a record date shall automatically
and without any action by the Company or the Trustee be set for determining the
Holders entitled to join in such declaration or direction, which record date
shall be the close of business on the tenth day (or, if such day is not a
Business Day, the first Business Day thereafter) following the day on which the
Trustee receives such declaration or direction, and, with respect to clause (i),
the Trustee may set any day as a record date for the purpose of determining the
Holders entitled to join in such notice of default. Promptly after such receipt
by the Trustee of any such declaration or direction referred to in clause (ii)
or (iii), and promptly after setting any record date with respect to clause (i),
and as soon as practicable thereafter, the Trustee shall notify the Company and
the Holders of any such record date so fixed. The Holders on such record date
(or their duly appointed agents or proxies), and only such Persons, shall be
entitled to join in such notice, declaration or direction, whether or not such
Holders remain Holders after such record date; provided that, unless such
notice, declaration or direction shall have become effective by virtue of
Holders of the requisite principal amount of Securities on such record date (or
their duly appointed agents or proxies) having joined therein on or prior to the
90th day after such record date, such notice, declaration or direction shall
automatically and without any action by any Person be canceled and of no further
effect. Nothing in this paragraph shall be construed to prevent a Holder (or a
duly appointed agent or proxy thereof) from giving, before or after the
expiration of such 90-day period, a notice, declaration or direction contrary to
or different from, or, after the expiration of such period, identical to, the
notice, declaration or direction to which such record date relates, in which
event a new record date in respect thereof shall be set pursuant to this
paragraph. In addition, nothing in this paragraph shall be construed to render
ineffective any notice, declaration or direction of the type referred to in this
paragraph given at any time to the Trustee and the Company by Holders (or their
duly appointed agents or proxies) of the requisite principal amount of
Securities on the date such notice, declaration or direction is so given.
(f) Except as provided in Sections 5.12 and 5.13, any request, demand,
authorization, direction, notice, consent, election, waiver or other Act of the
Holder of any Security shall bind every future Holder of the same Security and
the Holder of every Security issued upon the registration of transfer thereof or
in exchange therefor or in lieu thereof in respect of anything done, omitted or
suffered to be done by the Trustee or the Company in reliance thereon, whether
or not notation of such action is made upon such Security.
(g) The provisions of this Section 1.4 are subject to the provisions of
Section 9.5.
SECTION 1.5. Notices, Etc., to Trustee, Company and Alcatel.
Any request, demand, authorization, direction, notice, consent,
election, waiver or other Act of Holders of Securities or other document
provided or permitted by this Indenture to be made upon, given or furnished to,
or filed with,
(1) the Trustee by any Holder of Securities or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or filed in
writing to or with the Trustee and received at its Corporate Trust Office,
ATTENTION: CORPORATE TRUST ADMINISTRATION; facsimile no. (000) 000-0000.
14
31
(2) the Company or Alcatel by the Trustee or by any Holder of
Securities shall be sufficient for every purpose hereunder (unless otherwise
herein expressly provided) if in writing, mailed, first-class postage prepaid,
or telecopied and confirmed by mail, first-class postage prepaid, or delivered
by hand or overnight courier, addressed (i) if to the Company, to Alcatel USA,
Inc. at 0000 Xxxx Xxxx, Xxxxx, Xxxxx 00000, Attention: Treasurer; fascimile no.
(000) 000-0000, or at any other address previously furnished in writing to the
Trustee by the Company; and (ii) if to Alcatel, to Alcatel at 00, xxx xx Xxxxxx,
Xxxxx, Xxxxxx, 00000, Attention: Chief Financial Officer; facsimile no. (331)
40.76.14.91.
Any request, demand, authorization, direction, notice, consent,
election or waiver required or permitted under this Indenture shall be in the
English language, except that any published notice may be in an official
language of the country of publication.
SECTION 1.6. Notice to Holders of Securities; Waiver.
Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of Securities of any event, such notice shall be
sufficiently given to Holders if in writing and mailed, first-class postage
prepaid, to each Holder of a Security affected by such event, at the address of
such Holder as it appears in the Security Register, not earlier than the
earliest date and not later than the latest date prescribed for the giving of
such notice.
Neither the failure to mail such notice, nor any defect in any notice
so mailed, to any particular Holder of a Registered Security shall affect the
sufficiency of such notice with respect to other Holders of Registered
Securities. In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification to Holders of Registered Securities as shall be made with
the approval of the Trustee, which approval shall not be unreasonably withheld,
shall constitute a sufficient notification to such Holders for every purpose
hereunder.
Such notice shall be deemed to have been given when such notice is
mailed.
Where this Indenture provides for notice in any manner, such notice may
be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders of Securities shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
SECTION 1.7. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.8. Successors and Assigns.
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
15
32
SECTION 1.9. Separability Clause.
In case any provision in this Indenture or the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 1.10. Benefits of Indenture.
Except as provided in the next sentence, nothing in this Indenture or
in the Securities, express or implied, shall give to any Person, other than the
parties hereto and their successors and assigns hereunder and the Holders of
Securities, any benefit or legal or equitable right, remedy or claim under this
Indenture. The provisions of Article Thirteen are intended to be for the benefit
of, and shall be enforceable directly by, the holders of Senior Indebtedness.
SECTION 1.11. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, THE UNITED STATES OF AMERICA.
SECTION 1.12. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date,
Repurchase Date or Stated Maturity of any Security or the last day on which a
Holder of a Security has a right to convert his Security shall not be a Business
Day at a Place of Payment or Place of Conversion, as the case may be, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of principal of, premium, if any, or interest on, or the payment of the
Repurchase Price (whether the same is payable in cash or in Alcatel ADSs) with
respect to, or delivery for conversion of, such Security need not be made at
such Place of Payment or Place of Conversion, as the case may be, on or by such
day, but may be made on or by the next succeeding Business Day at such Place of
Payment or Place of Conversion, as the case may be, with the same force and
effect as if made on the Interest Payment Date, Redemption Date or Repurchase
Date, or at the Stated Maturity or by such last day for conversion; provided,
however, that in the case that payment is made on such succeeding Business Day,
no interest shall accrue on the amount so payable for the period from and after
such Interest Payment Date, Redemption Date, Repurchase Date, Stated Maturity or
last day for conversion, as the case may be.
SECTION 1.13. Conflict with Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a provision
of the Trust Indenture Act that is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
Until such time as this Indenture shall be qualified under the Trust Indenture
Act, this
16
33
Indenture, the Company and the Trustee shall be deemed for all purposes hereof
to be subject to and governed by the Trust Indenture Act to the same extent as
would be the case if this Indenture were so qualified on the date hereof.
ARTICLE TWO
SECURITY FORMS
SECTION 2.1. Form Generally.
The Securities shall be in substantially the forms set forth in this
Article, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture, and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange, the Internal Revenue Code of 1986, as amended, and
regulations thereunder (the "Code"), or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof. All Securities shall be Registered Securities.
The Trustee's certificates of authentication shall be in substantially
the form set forth in Section 2.3.
Conversion notices shall be in substantially the form set forth in
Section 2.5.
Repurchase notices shall be substantially in the form set forth in
Section 2.2.
The Securities shall be printed, lithographed, typewritten or engraved
or produced by any combination of these methods on steel engraved borders if so
required by any securities exchange upon which the Securities may be listed, or
may be produced in any other manner permitted by the rules of any such
securities exchange, or, if the Securities are not listed on a securities
exchange, in any other manner approved by the Company all as determined by the
officers executing such Securities, as evidenced by their execution thereof.
Upon their original issuance, Rule 144A Securities shall be issued in
the form of one or more Global Securities without interest coupons and shall be
registered in the name of DTC, as Depositary, or its nominee and deposited with
the Trustee, as custodian for DTC, for credit by DTC to the respective accounts
of beneficial owners of the Securities represented thereby (or such other
accounts as they may direct). Such Global Security, together with its Successor
Securities which are Global Securities other than the Regulation S Global
Security, are collectively herein called the "Restricted Global Security".
Upon their original issuance, Regulation S Securities shall be issued
in the form of one or more Global Securities without interest coupons and shall
be registered in the name of DTC, as Depositary, or its nominee and deposited
with the Trustee, as custodian for DTC for credit to the respective accounts at
DTC of the depositaries for Xxxxxx Guaranty Trust
17
34
Company of New York, Brussels office, as operator of Euroclear, or CEDEL. Such
Global Security, together with its Successor Securities which are Global
Securities other than the Restricted Global Security, are collectively herein
called the "Regulation S Global Security".
SECTION 2.2. Form of Security
[FORM OF FACE]
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH RESTRICTED SECURITY
OTHER THAN ANY RESTRICTED GLOBAL SECURITY:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS SECURITY AND ANY ALCATEL ADSs
DELIVERABLE UPON ITS CONVERSION MAY NOT BE SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLI CABLE EXEMPTION THEREFROM. THIS
SECURITY MAY ONLY BE SOLD IN ACCORDANCE WITH THE INDENTURE, COPIES OF WHICH ARE
AVAILABLE FOR INSPECTION AT THE CORPORATE TRUST OFFICE OF THE TRUSTEE. EACH
PURCHASER OF THIS SECURITY WHICH IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) IS HEREBY NOTIFIED THAT THE SELLER OF
THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF ALCATEL USA, INC.
(THE "COMPANY") THAT (A) THIS SECURITY AND ANY ALCATEL ADSs DELIVERABLE UPON ITS
CONVERSION MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (I) TO A PERSON
WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (II) IN AN OFFSHORE TRANSACTION COMPLYING WITH THE
PROVISIONS OF RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (III) IN THE
CASE OF ANY PURCHASER, OTHER THAN A PURCHASER WHO HAS OTHERWISE AGREED WITH THE
COMPANY IN WRITING, TO AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" WITHIN
THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (IF
AVAILABLE), (IV) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), OR (V) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND IN EACH OF CASES
(I) THROUGH (V) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF THE STATES
AND OTHER JURISDICTIONS OF THE UNITED STATES, AND THAT (B) THE HOLDER WILL, AND
EACH SUBSEQUENT HOLDER OF THIS SECURITY OR ANY ALCATEL ADSs DELIVERABLE UPON ITS
CONVERSION IS
18
35
REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY AND ANY ALCATEL ADSs
DELIVERABLE UPON ITS CONVERSION FROM IT OF THE RESALE RESTRICTIONS REFERRED TO
IN (A) ABOVE.
THIS SECURITY, ANY ALCATEL ADSs DELIVERABLE UPON ITS CONVERSION AND ANY
RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME TO MODIFY
THE RESTRICTIONS ON AND PROCEDURES FOR RESALES AND OTHER TRANSFERS OF THIS
SECURITY AND ANY SUCH ALCATEL ADSs TO REFLECT ANY CHANGE IN APPLICABLE LAW OR
REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE
RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS
SECURITY AND ANY SUCH ALCATEL ADSs SHALL BE DEEMED BY THE ACCEPTANCE OF THIS
SECURITY AND ANY SUCH ALCATEL ADSs TO HAVE AGREED TO ANY SUCH AMENDMENT OR
SUPPLEMENT.]
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH RESTRICTED
GLOBAL SECURITY:
THE SECURITIES EVIDENCED BY THIS GLOBAL SECURITY (OR ITS PREDECESSOR)
WERE ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
SUCH SECURITIES AND ANY ALCATEL ADSs DELIVERABLE UPON THEIR CONVERSION MAY NOT
BE SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. SUCH SECURITIES MAY ONLY BE SOLD IN ACCORDANCE
WITH THE INDENTURE, COPIES OF WHICH ARE AVAILABLE FOR INSPECTION AT THE
CORPORATE TRUST OFFICE OF THE TRUSTEE. EACH PURCHASER OF ANY BENEFICIAL INTEREST
IN THE SECURITIES WHICH IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) IS HEREBY NOTIFIED THAT THE SELLER OF SUCH
BENEFICIAL INTEREST IN THE SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
EACH BENEFICIAL OWNER OF AN INTEREST IN ANY OF THE SECURITIES EVIDENCED
BY THIS RESTRICTED GLOBAL SECURITY (INCLUDING ANY PARTICIPANT IN THE DEPOSITARY
HOLDING THE RESTRICTED GLOBAL SECURITY THAT IS SHOWN AS HOLDING SUCH AN INTEREST
ON THE RECORDS OF SUCH DEPOSITARY AND EACH BENEFICIAL OWNER THAT HOLDS THROUGH
ANY SUCH PARTICIPANT) AGREES FOR THE BENEFIT OF ALCATEL USA, INC. (THE
"COMPANY") THAT (A) ANY BENEFICIAL INTEREST IN THE SECURITIES AND ANY ALCATEL
ADSs DELIVERABLE UPON THEIR CONVERSION MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY (I) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
19
36
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) IN
AN OFFSHORE TRANSACTION COMPLYING WITH THE PROVISIONS OF RULE 904 OF REGULATION
S UNDER THE SECURITIES ACT, (III) IN THE CASE OF ANY PURCHASER, OTHER THAN A
PURCHASER WHO HAS OTHERWISE AGREED WITH THE COMPANY IN WRITING, TO AN
INSTITUTION THAT IS AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE
501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (IF AVAILABLE), (IV)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE), OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT AND IN EACH OF CASES (I) THROUGH (V) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF THE STATES AND OTHER
JURISDICTIONS OF THE UNITED STATES, AND THAT (B) THE BENEFICIAL OWNER WILL, AND
EACH SUBSEQUENT BENEFICIAL OWNER OF THIS SECURITY OR ANY ALCATEL ADSs
DELIVERABLE UPON ITS CONVERSION IS REQUIRED TO, NOTIFY ANY PURCHASER OF ANY
BENEFICIAL INTEREST IN THE SECURITIES AND ANY ALCATEL ADSs DELIVERABLE UPON ITS
CONVERSION FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
THIS SECURITY, ANY ALCATEL ADSs DELIVERABLE UPON ITS CONVERSION AND ANY
RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME TO MODIFY
THE RESTRICTIONS ON AND PROCEDURES FOR RESALES AND OTHER TRANSFERS OF THIS
SECURITY AND ANY SUCH ALCATEL ADSs TO REFLECT ANY CHANGE IN APPLICABLE LAW OR
REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE
RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER AND BENEFICIAL
OWNERS OF AN INTEREST IN ANY OF THE SECURITIES EVIDENCED BY THIS GLOBAL SECURITY
AND ANY SUCH ALCATEL ADSs SHALL BE DEEMED BY THE ACCEPTANCE OF THIS GLOBAL
SECURITY AND THE BENEFICIAL INTERESTS THEREIN AND ANY SUCH ALCATEL ADSs TO HAVE
AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.]
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH GLOBAL SECURITY:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITARY OR A
NOMINEE OF THE DEPOSITARY, WHICH MAY BE TREATED BY THE COMPANY, THE TRUSTEE AND
ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS SECURITY FOR ALL PURPOSES.]
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH GLOBAL SECURITY
FOR WHICH DTC IS TO BE THE DEPOSITARY:
20
37
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ALCATEL USA,
INC. OR ITS AGENT FOR REGISTRATION OR TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR REGISTERED
SECURITIES IN DEFINITIVE REGISTERED FORM IN THE LIMITED CIRCUMSTANCES REFERRED
TO IN THE INDENTURE, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A
WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE
DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH
SUCCESSOR DEPOSITARY.]
[THE FOLLOWING LEGEND SHALL APPEAR ON THE FACE OF EACH REGULATION S
GLOBAL SECURITY:
THE SECURITIES EVIDENCED BY THIS GLOBAL SECURITY (OR ITS PREDECESSOR)
WERE ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON EXCEPT PURSUANT TO AN
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND
ALL APPLICABLE STATE SECURITIES LAWS. TERMS USED ABOVE HAVE THE MEANINGS GIVEN
THEM IN REGULATION S UNDER THE SECURITIES ACT.]
ALCATEL USA, INC.
7% CONVERTIBLE SUBORDINATED NOTE
DUE AUGUST 1, 2004
No. _____________ U.S.$_____
[IF RESTRICTED GLOBAL SECURITY - CUSIP NO. ]
[IF REGULATION S GLOBAL SECURITY - CUSIP NO. ]
21
38
ALCATEL USA, INC., a corporation duly organized and existing under the
laws of the State of Delaware (herein called the "Company", which term includes
any successor Person under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to _______________, or registered
assigns, the principal sum of _____________ United States Dollars (U.S.$ _____)
[IF THIS SECURITY IS A GLOBAL SECURITY, THEN INSERT -- (which principal amount
may from time to time be increased or decreased to such other principal amounts
(which, taken together with the principal amounts of all other Outstanding
Securities, shall not exceed $400,000,000 in the aggregate at any time) by
adjustments made on the records of the Trustee hereinafter referred to in
accordance with the Indenture)] on August 1, 2004 and to pay interest thereon,
from August 12, 1997, or from the most recent Interest Payment Date (as defined
below) to which interest has been paid or duly provided for, semi-annually in
arrears on February 1 and August 1 in each year (each, an "Interest Payment
Date"), commencing February 1, 1998, at the rate of 7% per annum, until the
principal hereof is due, and at the rate of 7% per annum on any overdue
principal and premium, if any, and, to the extent permitted by law, on any
overdue interest. The interest so payable, and punctually paid or duly provided
for, on any Interest Payment Date will, as provided in the Indenture, be paid to
the Person in whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such
interest, which shall be the January 15 or July 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Except as
otherwise provided in the Indenture, any such interest not so punctually paid or
duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Company, notice whereof shall be given to Holders of Registered
Securities not less than 10 days prior to such Special Record Date, or be paid
at any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in the
Indenture. Payments of principal shall be made upon the surrender of this
Security at the option of the Holder at the Corporate Trust Office of the
Trustee, or at such other office or agency of the Company as may be designated
by it for such purpose in the Borough of Manhattan, The City of New York, in
such coin or currency of the United States of America as at the time of payment
shall be legal tender for the payment of public and private debts, or at such
other offices or agencies as the Company may designate, by United States Dollar
check drawn on, or transfer to, a United States Dollar account (such a transfer
to be made only to a Holder of an aggregate principal amount of Registered
Securities in excess of U.S.$2,000,000, and only if such Holder shall have
furnished wire instructions in writing to the Trustee no later than 15 days
prior to the relevant payment date) maintained by the payee with a bank in the
Borough of Manhattan, The City of New York. Payment of interest on this Security
may be made by United States Dollar check drawn on a bank in the Borough of
Manhattan, The City of New York mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register, or, upon written
application by the Holder to the Security Registrar setting forth wire
instructions not later than the relevant Record Date, by transfer to a United
States Dollar account (such a transfer to be made only to a Holder of an
aggregate principal amount of Registered Securities in excess of U.S.$2,000,000
and only if such Holder shall have furnished wire
22
39
instructions in writing to the Trustee no later than 15 days prior to the
relevant payment date) maintained by the payee with a bank in the Borough of
Manhattan, The City of New York.
Except as specifically provided herein and in the Indenture, the
Company shall not be required to make any payment with respect to any tax,
assessment or other governmental charge imposed by any government or any
political subdivision or taxing authority thereof or therein.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof or an Authenticating Agent by the
manual signature of one of their respective authorized signatories, this
Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Security to be duly
executed.
ALCATEL USA, INC.
By:
----------------------------------
Name:
Title:
[Certificate of Authentication]
Dated: [Date of Authentication]
23
40
[FORM OF REVERSE]
This Security is one of a duly authorized issue of securities of the
Company designated as its "7% Convertible Subordinated Notes due August 1, 2004"
(herein called the "Securities"), limited in aggregate principal amount to
U.S.$400,000,000, issued and to be issued under an Indenture, dated as of August
12, 1997 (the "Initial Indenture"), as supplemented by the First Supplemental
Indenture dated as of September 4, 1998, between the Company and The Bank of New
York (the "First Supplemental Indenture") and the Second Supplemental Indenture
dated as of April 1, 1999, between the Company, Alcatel and The Bank of New
York, as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture) (the "Second Supplemental Indenture", together with
the Initial Indenture and the First Supplemental Indenture, the "Indenture"), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee, the holders of Senior
Indebtedness and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. As provided in the
Indenture and subject to certain limitations therein set forth, Registered
Securities are exchangeable for a like aggregate principal amount of Registered
Securities of any authorized denominations as requested by the Holder
surrendering the same upon surrender of the Registered Security or Registered
Securities to be exchanged, at the Corporate Trust Office of the Trustee. The
Trustee upon such surrender by the Holder will issue the new Registered
Securities in the requested denominations.
No sinking fund is provided for the Securities. The Securities are
subject to redemption at the option of the Company at any time on or after
August 1, 2000, in whole or in part, upon not less than 30 nor more than 60
days' notice to the Holders prior to the Redemption Date at the following
Redemption Prices (expressed as percentages of the principal amount) for the
twelve-month period beginning on August 1 of the following years:
Year Redemption Price
---- ----------------
2000 104.0%
2001 103.0%
2002 102.0%
2003 101.0%
and thereafter at a Redemption Price equal to 100% of the principal amount,
together, in each case, with accrued interest to the Redemption Date; provided,
however, that interest installments on Registered Securities whose Stated
Maturity is on or prior to such Redemption Date will be payable to the Holders
of such Securities, or one or more Predecessor Securities, of record at the
close of business on the relevant Record Dates referred to on the face hereof,
all as provided in the Indenture.
24
41
In the event of a redemption of the Securities, the Company will not be
required (a) to register the transfer or exchange of Registered Securities for a
period of 15 days immediately preceding the date notice is given identifying the
serial numbers of the Securities called for such redemption or (b) to register
the transfer or exchange of any Registered Security, or portion thereof, called
for redemption.
Notice to the Holders will be given not less than 30 nor more than 60
days prior to the Redemption Date as provided in the Indenture.
In any case where the due date for the payment of the principal of,
premium, if any, interest, or Liquidated Damages on any Security or the last day
on which a Holder of a Security has a right to convert his Security shall be, at
any Place of Payment or Place of Conversion, as the case may be, a day on which
banking institutions at such Place of Payment or Place of Conversion are
authorized or obligated by law or executive order to close, then payment of
principal, premium, if any, interest, or Liquidated Damages, or delivery for
conversion of such Security need not be made on or by such date at such place
but may be made on or by the next succeeding day at such place which is not a
day on which banking institutions are authorized or obligated by law or
executive order to close, with the same force and effect as if made on the date
for such payment or the date fixed for redemption or repurchase, or by such last
day for conversion, and no interest shall accrue on the amount so payable for
the period after such date.
Subject to and upon compliance with the provisions of the Indenture,
the Holder of this Security is entitled, at his option, at any time on or after
90 days after the last original issue date of the Notes and on or before the
close of business on August 1, 2004, or in case this Security or a portion
hereof is called for redemption or the Holder hereof has exercised his right to
require the Company to repurchase this Security or such portion hereof, then in
respect of this Security until and including, but (unless the Company defaults
in making the payment due upon redemption or repurchase, as the case may be) not
after, the close of business on the fifth Trading Pay prior to Redemption Date
or the second Trading Day prior to Repurchase Date, as the case may be, to
convert this Security (or any portion of the principal amount hereof that is an
integral multiple of U.S.$1,000, provided that the unconverted portion of such
principal amount is U.S.$1,000 or any integral multiple of U.S.$1,000 in excess
thereof) into Alcatel ADSs at an initial Conversion Price of U.S. $61.012 for
each Alcatel ADS (or at the current adjusted Conversion Price if an adjustment
has been made as provided in the Indenture) by surrender of this Security, duly
endorsed or assigned to the Company or in blank and, in case such surrender
shall be made during the period from the close of business on any Regular Record
Date next preceding any Interest Payment Date to the opening of business on such
Interest Payment Date (except if this Security has been called for redemption on
a Redemption Date or is repurchasable on a Repurchase Date occurring, in either
case, during such period and is surrendered for such conversion during such
period), also accompanied by payment in New York Clearing House or other funds
acceptable to the Company of an amount equal to the interest payable on such
Interest Payment Date on the principal amount of this Security then being
converted, and also the conversion notice hereon duly executed, to the Company
at the Corporate Trust Office of the Trustee, or at such other office or agency
of the Company, subject to any laws or
25
42
regulations applicable thereto and subject to the right of the Company to
terminate the appointment of any Conversion Agent (as defined below) as may be
designated by it for such purpose in the Borough of Manhattan, The City of New
York, or at such other offices or agencies as the Company may designate (each a
"Conversion Agent"), provided, further, that if this Security or portion hereof
has been called for redemption on a Redemption Date or is repurchasable on a
Repurchase Date occurring, in either case, during the period from the close of
business on any Regular Record Date next preceding any Interest Payment Date to
the opening of business on such succeeding Interest Payment Date and is
surrendered for conversion during such period, then the Holder of this Security
who converts this Security or a portion hereof during such period will be
entitled to receive the interest accruing hereon from the Interest Payment Date
next preceding the date of such conversion to such succeeding Interest Payment
Date and shall not be required to pay such interest upon surrender of this
Security for conversion. Subject to the provisions of the preceding sentence
and, in the case of a conversion after the close of business on the Regular
Record Date next preceding any Interest Payment Date and on or before the close
of business on such Interest Payment Date, to the right of the Holder of this
Security (or any Predecessor Security of record as of such Regular Record Date)
to receive the related installment of interest to the extent and under the
circumstances provided in the Indenture, no cash payment or adjustment is to be
made on conversion for interest accrued hereon from the Interest Payment Date
next preceding the day of conversion, or for dividends on the Alcatel ADSs
issued on conversion hereof. The Company shall thereafter deliver to the Holder
the fixed number of Alcatel ADSs (together with any cash adjustment, as provided
in the Indenture) into which this Security is convertible and such delivery will
be deemed to satisfy the Company's obligation to pay the principal amount of
this Security. No fractions of Alcatel ADSs or scrip representing fractions of
Alcatel ADSs will be delivered on conversion, but instead of any fractional
interest (calculated to the nearest 1/100th of an Alcatel ADS) the Company shall
pay a cash adjustment as provided in the Indenture. The Conversion Price is
subject to adjustment as provided in the Indenture. In addition, the Indenture
provides that in case of certain consolidations or mergers to which Alcatel is a
party or the conveyance, transfer, sale or lease of all or substantially all of
the property and assets of Alcatel, the Indenture shall be amended, without the
consent of any Holders of Securities, so that this Security, if then
Outstanding, will be convertible thereafter, during the period this Security
shall be convertible as specified above, only into the kind and amount of
securities, cash and other property receivable upon such consolidation, merger,
conveyance, transfer, sale or lease by a holder of the number of Alcatel ADSs
into which this Security could have been converted immediately prior to such
consolidation, merger, conveyance, transfer, sale or lease (assuming such holder
of Alcatel ADSs is not a Constituent Person, failed to exercise any rights of
election and received per Alcatel ADS the kind and amount received per Alcatel
ADS by a plurality of Non-electing Alcatel ADSs and further assuming, if such
consolidation, merger, conveyance, transfer, sale or lease occurs prior to 90
days following the last original issue date of the Securities, that the Security
was convertible at the time of such occurrence at the Conversion Price specified
above as adjusted from the issue date of such Security to such time as provided
in the Indenture). No adjustment in the Conversion Price will be made until such
adjustment would require an increase or decrease of at least one percent of such
price, provided that any adjustment that would otherwise be made will be carried
forward and taken into account in the computation of any subsequent adjustment.
26
43
Subject to certain limitations in the Indenture, at any time when the
Company is not subject to Section 13 or 15(d) of the United States Securities
Exchange Act of 1934, as amended, upon the request of a Holder of a Restricted
Security or the holder of Alcatel ADSs delivered upon conversion thereof, the
Company will promptly furnish or cause to be furnished Rule 144A Information (as
defined below) to such Holder of Restricted Securities or such holder of Alcatel
ADSs delivered upon conversion of Restricted Securities, or to a prospective
purchaser of any such security designated by any such Holder or holder, as the
case may be, to the extent required to permit compliance by such Holder or
holder with Rule 144A under the United States Securities Act of 1933, as amended
(the "Securities Act"), in connection with the resale of any such security.
"Rule 144A Information" shall be such information as is specified pursuant to
Rule 144A(d)(4) under the Securities Act (or any successor provision thereto).
If this Security is a Registrable Security, then the Holder of this
Security [IF THIS SECURITY IS A GLOBAL SECURITY, THEN INSERT-- (including any
Person that has a beneficial interest in this Security)] and the Alcatel ADSs
deliverable upon conversion hereof is entitled to the benefits of a Registration
Rights Agreement, dated as of August 7, 1997 (the "Registration Rights
Agreement"), executed by the Company. Pursuant to the Registration Rights
Agreement, the Company has agreed for the benefit of the Holders from time to
time of Registered Securities and the Alcatel ADSs deliverable upon conversion
thereof, in each case, that are Registrable Securities, at the Company's
expense, (a) to file within 90 days after the first date of original issuance of
the Securities, a shelf registration statement (the "Shelf Registration
Statement") with the Commission with respect to resales of the Registrable
Securities, (b) thereafter to use reasonable efforts to cause such Shelf
Registration Statement to be declared effective by the Commission within 90 days
after the filing of such Shelf Registration Statement, and (c) to use reasonable
efforts to maintain such Shelf Registration Statement continuously effective
under the Securities Act until a period of the two years from the last date of
original issuance of the Securities or, if earlier, until (1) there are no
outstanding Registrable Securities or (2) when, in the written opinion of
independent counsel to the Company, all outstanding Registrable Securities held
by persons that are not "affiliates" of the Company (as defined in Rule
144(a)(1) under the Securities Act) may be resold without registration under the
Securities Act pursuant to Rule 144(k) under the Securities Act (or any
successor provision thereto) and the Company has removed all legends from the
Registrable Securities restricting the transfer thereof (other than any
Registrable Security held by an affiliate).
If (i) on or prior to 90 days following the date of original issuance
of the Registered Securities, a Shelf Registration Statement has not been filed
with the Commission, or (ii) on or prior to the 90th day following such filing,
such Shelf Registration Statement is not declared effective (each, a
"Registration Default"), additional interest ("Liquidated Damages") will accrue
on this Security from and including the day following such Registration Default
to but excluding the day on which such Registration Default has been cured.
Liquidated Damages will be paid semi-annually in arrears, with the first
semi-annual payment due on the first interest payment date in respect of the
Registered Securities following the date on which such Liquidated Damages begin
to accrue, and will accrue at a
27
44
rate per annum equal to an additional one-quarter of one percent (.25%) of the
principal amount of the Registered Securities to and including the 90th day
following such Registration Default and at a rate per annum equal to one-half of
one percent (.50%) thereof from and after the 91st day following such
Registration Default. In the event that the Shelf Registration Statement ceases
to be effective (or the Holders are otherwise prevented or restricted by the
Company from effecting sales pursuant thereto) prior to the third annual
anniversary of the initial effective date of the Shelf Registration Statement or
such earlier date as is provided in the Registration Rights Agreement for a
period in excess of 60 days, whether or not consecutive, during any 12-month
period (an "Effectiveness Failure"), then the interest rate borne by the
Registered Securities shall increase by an additional one-half of one percent
(.50%) per annum from the 61st day of the applicable 12-month period such Shelf
Registration Statement ceases to be effective (or the Holders are otherwise
prevented or restricted by the Company from effecting sales pursuant thereto) to
but excluding the day on which the Effectiveness Failure is cured. For purposes
of determining an Effectiveness Failure, days on which the Company has been
obligated to pay Liquidated Damages in respect of a prior Effectiveness Failure
within the applicable 12 month period will not be included.
Whenever in this Security there is a reference, in any context, to the
payment of the principal of, premium, if any, or interest on, or in respect of,
any Security such mention shall be deemed to include mention of the payment of
Liquidated Damages payable as described in the preceding paragraph to the extent
that, in such context, Liquidated Damages are, were or would be payable in
respect of this Security pursuant to such paragraph, and an express mention of
the payment of Liquidated Damages (if applicable) in any provisions of this
Security shall not be construed as excluding Liquidated Damages in those
provisions of this Security where such express mention is not made.
[If this Security is a Registrable Security and the Holder of this
Security [IF THIS SECURITY IS A GLOBAL SECURITY, THEN INSERT-- (including any
Person that has a beneficial interest in this Security)] elects to sell this
Security pursuant to the Shelf Registration Statement then, by its acceptance
hereof, such Holder of this Security agrees to be bound by the terms of the
Registration Rights Agreement relating to the Registrable Securities which are
the subject of such election.]
If a Change in Control occurs, the Holder of this Security, at the
Holder's option, shall have the right, in accordance with the provisions of the
Indenture, to require the Company to repurchase this Security (or any portion of
the principal amount hereof that is an integral multiple of $1,000, provided
that the portion of the principal amount of this Security to be Outstanding
after such repurchase is at least equal to U.S.$5,000) for cash at a Repurchase
Price equal to 100% of the principal amount thereof plus interest accrued to the
Repurchase Date. At the option of the Company, the Repurchase Price may be paid
in cash or, subject to the conditions provided in the Indenture, by delivery of
Alcatel ADSs having a fair market value equal to the Repurchase Price. For
purposes of this paragraph, the fair market value of Alcatel ADSs shall be
determined by the Company and shall be equal to 95% of the average of the
Closing Prices Per Alcatel ADS for the five consecutive Trading Days ending on
the third Trading Day immediately preceding the Repurchase Date. Whenever in
this Security
28
45
there is a reference, in any context, to the principal of any Security as of any
time, such reference shall be deemed to include reference to the Repurchase
Price payable in respect of such Security to the extent that such Repurchase
Price is, was or would be so payable at such time, and express mention of the
Repurchase Price in any provision of this Security shall not be construed as
excluding the Repurchase Price so payable in those provisions of this Security
when such express mention is not made; provided, however, that, for the purposes
of the second succeeding paragraph, such reference shall be deemed to include
reference to the Repurchase Price only to the extent the Repurchase Price is
payable in cash.
[THE FOLLOWING PARAGRAPH SHALL APPEAR IN EACH REGISTERED SECURITY THAT
IS NOT A GLOBAL SECURITY:
In the event of redemption, repurchase or conversion of this Security
in part only, a new Registered Security or Registered Securities for the
unredeemed, unrepurchased or unconverted portion hereof will be issued in the
name of the Holder hereof.]
[THE FOLLOWING PARAGRAPH SHALL APPEAR IN EACH GLOBAL SECURITY:
In the event of a deposit or withdrawal of an interest in this
Security, including an exchange, transfer, redemption, repurchase or conversion
of this Security in part only, the Trustee, as custodian of the Depositary,
shall make an adjustment on its records to reflect such deposit or withdrawal in
accordance with the Applicable Procedures.]
The indebtedness evidenced by this Security is, to the extent and in
the manner provided in the Indenture, subordinate and subject in right of
payment to the prior payment in full of all Senior Indebtedness of the Company,
and this Security is issued subject to such provisions of the Indenture with
respect thereto. Each Holder of this Security, by accepting the same, (a) agrees
to and shall be bound by such provisions, (b) authorizes and directs the Trustee
on his behalf to take such action as may be necessary or appropriate to
effectuate the subordination so provided and (c) appoints the Trustee his
attorney-in-fact for any and all such purposes.
If an Event of Default shall occur and be continuing, the principal of
all the Securities, together with accrued interest to the date of declaration,
may be declared due and payable in the manner and with the effect provided in
the Indenture. Upon payment (i) of the amount of principal so declared due and
payable, together with accrued interest to the date of declaration, and (ii) of
interest on any overdue principal and, to the extent permitted by applicable
law, overdue interest, all of the Company's obligations in respect of the
payment of the principal of and interest on the Securities shall terminate.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time by the Company and the Trustee with either (a) the written consent of
the Holders of a majority in principal amount of the Securities at the time
Outstanding, or (b) by the adoption of a resolution, at a meeting of
29
46
Holders of the Outstanding Securities at which a quorum is present, by the
Holders of (i) 66-2/3% in aggregate principal amount of the Outstanding
Securities represented and entitled to vote at such meeting or (ii) a majority
in principal amount of the Outstanding Securities. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities at the time Outstanding, on behalf of the Holders of all the
Securities, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Security shall be conclusive
and binding upon such Holder and upon all future Holders of this Security and of
any Security issued in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security or such other
Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default, the Holders of not
less than 25% in principal amount of the Outstanding Securities shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity and the
Trustee shall not have received from the Holders of a majority in principal
amount of the Securities Outstanding a direction inconsistent with such request,
and shall have failed to institute any such proceeding, for 60 days after
receipt of such notice, request and offer of indemnity. The foregoing shall not
apply to any suit instituted by the Holder of this Security for the enforcement
of any payment of principal hereof, premium, if any, or interest hereon
(including Liquidated Damages or additional interest) on or after the respective
due dates expressed herein or for the enforcement of the right to convert this
Security as provided in the Indenture.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of, premium, if any, and
interest on (including Liquidated Damages and additional interest) this Security
at the times, places and rate, and in the coin or currency, herein prescribed or
to convert this Security as provided in the Indenture.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of Registered Securities is registrable on the Security
Register upon surrender of a Registered Security for registration of transfer at
the Corporate Trust Office of the Trustee or at such other office or agency of
the Company as may be designated by it for such purpose in the Borough of
Manhattan, The City of New York, or at such other offices or agencies as the
Company may designate, duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder thereof or his attorney duly authorized in writing, and
thereupon one or more new Registered Securities, of authorized denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees by the Registrar. No service charge shall be made for
any such registration of transfer or exchange, but the Company may
30
47
require payment of a sum sufficient to recover any tax or other governmental
charge payable in connection therewith.
Prior to due presentation of a Registered Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Registered Security is registered, as
the owner thereof for all purposes, whether or not such Security be overdue, and
neither the Company, the Trustee nor any such agent shall be affected by notice
to the contrary.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA,
WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
31
48
ELECTION OF HOLDER TO REQUIRE REPURCHASE
1. Pursuant to Section 14.1 of the Indenture, the undersigned hereby
elects to have this Security repurchased by the Company.
2. The undersigned hereby directs the Trustee or the Company to pay it
or __________________ an amount in cash or, at the Company's election, Alcatel
ADSs valued as set forth in the Indenture, equal to 100% of the principal amount
to be repurchased (as set forth below), plus interest accrued to the Repurchase
Date, as provided in the Indenture.
Dated:
---------------------------------------
---------------------------------------
Signature
---------------------------------------
Signature Guaranteed
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the [Registrar], which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the [Registrar] in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Principal amount to be repurchased
(an integral multiple of U.S.$1,000): ______________________
Remaining principal amount following
such repurchase (not less than U.S.$5,000): ______________________
NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Security in every particular, without alteration
or any change whatsoever.
32
49
SECTION 2.3. Form of Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially
the following form:
This is one of the Securities referred to in the within-mentioned
Indenture.
The Bank of New York
as Trustee
By: ______________________________________
Authorized Signature
Dated: _________________________
SECTION 2.4. Form of Conversion Notice.
CONVERSION NOTICE
The undersigned Holder of this Security hereby irrevocably exercises
the option to convert this Security, or any portion of the principal amount
hereof (which is an integral multiple of U.S.$1,000, provided that the
unconverted portion of such principal amount is U.S.$1,000 or any integral
multiple of U.S.$1,000 in excess thereof) below designated, into Alcatel ADSs in
accordance with the terms of the Indenture referred to in this Security, and
directs that such Alcatel ADSs, together with a check in payment for any
fractional Alcatel ADS and any Securities representing any unconverted principal
amount hereof, be delivered to and be registered in the name of the undersigned
unless a different name has been indicated below. If Alcatel ADSs or Securities
are to be registered in the name of a Person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect thereto. Any amount
required to be paid by the undersigned on account of interest accompanies this
Security.
Dated: _________________________
_________________________
Signature
33
50
If Alcatel ADSs or Registered Securities If only a portion of the Securities is
to be are to be registered in the name of a Person converted, please indicate:
other than the Holder, please print such
Person's name and address:
1. Principal amount to be
converted:
U.S.$ ___________
____________________________
Name 2. Principal amount and
denomination of Registered
Securities representing
unconverted principal amount
____________________________ to be issued:
Address
Amount: U.S.$________
____________________________ Denominations:
Social Security or other U.S.$______
Taxpayer Identification Number, if any (any integral multiple of
U.S.$1,000, provided that the
unconverted portion of such principal
amount is U.S. $1,000 or any integral
multiple of U.S.$1,000 in excess thereof)
__________________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the [Registrar], which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the [Registrar] in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
34
51
ARTICLE THREE
THE SECURITIES
SECTION 3.1. Title and Terms.
The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is limited to U.S.$400,000,000, except for
Securities authenticated and delivered in exchange for, or in lieu of, other
Securities pursuant to Section 3.4, 3.5, 3.6, 8.5, 11.8, 12.2 or 14.3(f).
The Securities shall be known and designated as the "7% Convertible
Subordinated Notes due August 1, 2004" of the Company. Their Stated Maturity
shall be August 1, 2004 and they shall bear interest on their principal amount
from August 12, 1997, payable semi-annually in arrears on February 1 and August
1 in each year, commencing February 1, 1998, at the rate of 7% per annum until
the principal thereof is due and at the rate of 7% per annum on any overdue
principal and, to the extent permitted by law, on any overdue interest;
provided, however, that payments shall only be made on Business Days as provided
in Section 1.12.
The principal of, premium, if any, and interest on the Securities shall
be payable as provided in the form of Securities set forth in Section 2.2, and
the Repurchase Price, whether payable in cash or in Alcatel ADSs, shall be
payable at such places as are identified in the Company Notice given pursuant to
Section 14.3 (any city in which any Paying Agent is located being herein called
a "Place of Payment").
The Registrable Securities are entitled to the benefits of a
Registration Rights Agreement as provided by Sections 2.2 and 10.12. The
Securities are entitled to the payment of Liquidated Damages and additional
interest as provided by Section 10.12.
The Securities shall be redeemable at the option of the Company at any
time on or after August 1, 2000, in whole or in part, as provided in Article
Eleven and in the form of Securities set forth in Section 2.2.
The Securities shall be convertible as provided in Article Twelve (any
city in which any Conversion Agent is located being herein called a "Place of
Conversion").
The Securities shall be subordinated in right of payment to Senior
Indebtedness of the Company as provided in Article Thirteen.
The Securities shall be subject to repurchase by the Company at the
option of the Holders as provided in Article Fourteen.
SECTION 3.2. Denominations.
35
52
The Securities shall be issuable only in registered form, without
coupons, in denominations of U.S.$1,000 and integral multiples of U.S.$1,000 in
excess thereof.
SECTION 3.3. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its Chief Executive
Officer, its President, its Chief Financial Officer or one of its Vice
Presidents. Any such signature may be manual or facsimile.
Securities bearing the manual or facsimile signature of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities executed by the Company to
the Trustee or to its order for authentication, together with a Company Order
for the authentication and delivery of such Securities, and the Trustee in
accordance with such Company Order shall authenticate and make available for
delivery such Securities as in this Indenture provided and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature of an authorized signatory, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
SECTION 3.4. Global Securities.
(a) Each Global Security authenticated under this Indenture shall be
registered in the name of the Depositary designated by the Company for such
Global Security or a nominee thereof and delivered to such Depositary or a
nominee thereof or custodian therefor, and each such Global Security shall
constitute a single Security for all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Security or a nominee
thereof unless (i) such Depositary (A) has notified the Company that it is
unwilling or unable to continue as Depositary for such Global Security or (B)
has ceased to be a clearing agency registered as such under the Exchange Act or
announces an intention permanently to cease business or does in fact do so or
(ii) there shall have occurred and be continuing an Event of Default with
respect to such Global Security.
36
53
(c) If any Global Security is to be exchanged for other Securities or
canceled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Trustee, as Security Registrar, for exchange or cancellation,
as provided in this Article Three. If any Global Security is to be exchanged for
other Securities or canceled in part, or if another Security is to be exchanged
in whole or in part for a beneficial interest in any Global Security, in each
case, as provided in Section 3.5, then either (i) such Global Security shall be
so surrendered for exchange or cancellation, as provided in this Article Three,
or (ii) the principal amount thereof shall be reduced or increased by an amount
equal to the portion thereof to be so exchanged or canceled, or equal to the
principal amount of such other Security to be so exchanged for a beneficial
interest therein, as the case may be, by means of an appropriate adjustment made
on the records of the Trustee, as Security Registrar, whereupon the Trustee, in
accordance with the Applicable Procedures, shall instruct the Depositary or its
authorized representative to make a corresponding adjustment to its records.
Upon any such surrender or adjustment of a Global Security, the Trustee shall,
subject to Section 3.5(c) and as otherwise provided in this Article Three,
authenticate and deliver any Securities issuable in exchange for such Global
Security (or any portion thereof) to or upon the order of, and registered in
such names as may be directed by, the Depositary or its authorized
representative. Upon the request of the Trustee in connection with the
occurrence of any of the events specified in the preceding paragraph, the
Company shall promptly make available to the Trustee a reasonable supply of
Securities that are not in the form of Global Securities. The Trustee shall be
entitled to rely upon any order, direction or request of the Depositary or its
authorized representative which is given or made pursuant to this Article Three
if such order, direction or request is given or made in accordance with the
Applicable Procedures.
(d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article Three or otherwise, shall be
authenticated and delivered in the form of, and shall be, a registered Global
Security, unless such Security is registered in the name of a Person other than
the Depositary for such Global Security or a nominee thereof, in which case such
Registered Security shall be authenticated and delivered in definitive, fully
registered form, without interest coupons.
(e) The Depositary or its nominee, as registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under the
Indenture and the Registered Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security will be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members and
such owners of beneficial interests in a Global Security will not be considered
the owners or holders thereof.
SECTION 3.5. Registration, Registration of Transfer and Exchange; Restrictions
on Transfer.
37
54
(a) The Company shall cause to be kept at the Corporate Trust Office of
the Trustee a register (the register maintained in such office and in any other
office or agency of the Company designated pursuant to Section 10.2 being herein
sometimes collectively referred to as the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall provide
for the registration of Registered Securities and of transfers of Registered
Securities. The Trustee is hereby appointed "Security Registrar" for the purpose
of registering Registered Securities and transfers and exchanges of Registered
Securities as herein provided.
Upon surrender for registration of transfer of any Security at an
office or agency of the Company designated pursuant to Section 10.2 for such
purpose, the Company shall execute, and the Trustee shall authenticate and make
available for delivery, in the name of the designated transferee or transferees,
one or more new Securities of any authorized denominations and of a like
aggregate principal amount and bearing such restrictive legends as may be
required by this Indenture.
At the option of the Holder, and subject to the other provisions of
this Section 3.5, Securities may be exchanged for other Securities of any
authorized denomination and of a like aggregate principal amount, upon surrender
of the Securities to be exchanged at any such office or agency. Whenever any
Securities are so surrendered for exchange, and subject to the other provisions
of this Section 3.5, the Company shall execute, and the Trustee shall
authenticate and make available for delivery, the Securities which the Holder
making the exchange is entitled to receive. Every Security presented or
surrendered for registration of transfer or for exchange shall (if so required
by the Company or the Security Registrar) be duly endorsed, or be accompanied by
a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed, by the Holder thereof or his attorney duly
authorized in writing.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and subject to the other provisions of this Section 3.5, entitled to the
same benefits under this Indenture, as the Securities surrendered upon such
registration of transfer or exchange.
No service charge shall be made for any registration of transfer or
exchange of Securities except as provided in Section 3.6, but the Company may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Securities, other than exchanges pursuant to Section 3.4, 8.5, 11.8,
12.2 or 14.3 (other than where Alcatel ADSs are to be delivered in a name other
than that of the Holder of the Security) not involving any transfer and other
than any stamp and other duties, if any, which may be imposed in connection with
any such transfer or exchange by the United States or any political subdivision
thereof or therein, which shall be paid by the Company.
In the event of a redemption of the Securities, the Company will not be
required (a) to register the transfer of or exchange Securities for a period of
15 days immediately preceding the date notice is given identifying the serial
numbers of the Securities called for such
38
55
redemption or (b) to register the transfer of or exchange any Security, or
portion thereof, called for redemption.
(b) Certain Transfers and Exchanges. Notwithstanding any other
provision of this Indenture or the Securities, transfers and exchanges of
Securities and beneficial interests in a Global Security of the kinds specified
in this Section 3.5(b) shall be made only in accordance with this Section
3.5(b).
(i) Restricted Global Security to Regulation S Global Security. If the
owner of a beneficial interest in the Restricted Global Security wishes at any
time to transfer such interest to a Person who wishes to acquire the same in the
form of a beneficial interest in the Regulation S Global Security, such transfer
may be effected only in accordance with the provisions of this Clause (b)(i) and
Clause (b)(v) below and subject to the Applicable Procedures. Upon receipt by
the Trustee, as Security Registrar, of (A) an order given by the Depositary or
its authorized representative directing that a beneficial interest in the
Regulation S Global Security in a specified principal amount be credited to a
specified Agent Member's account and that a beneficial interest in the
Restricted Global Security in an equal principal amount be debited from another
specified Agent Member's account and (B) a Regulation S Certificate,
satisfactory to the Trustee and duly executed by the owner of such beneficial
interest in the Restricted Global Security or his attorney duly authorized in
writing, then the Trustee, as Security Registrar but subject to Clause (b)(v)
below, shall reduce the principal amount of the Restricted Global Security and
increase the principal amount of the Regulation S Global Security by such
specified principal amount as provided in Section 3.4(A)(c).
(ii) Regulation S Global Security to Restricted Global Security. If the
owner of a beneficial interest in the Regulation S Global Security wishes at any
time to transfer such interest to a Person who wishes to acquire the same in the
form of a beneficial interest in the Restricted Global Security, such transfer
may be effected only in accordance with this Clause (b)(ii) and subject to the
Applicable Procedures. Upon receipt by the Trustee, as Security Registrar, of
(A) an order given by the depositary or its authorized representative directing
that a beneficial interest in the Restricted Global Security in a specified
principal amount be credited to a specified Agent Member's account and that a
beneficial interest in the Regulation S Global Security in an equal principal
amount be debited from another specified Agent Member's account and (B) if such
transfer is to occur during the Restricted Period, a Restricted Securities
Certificate, satisfactory to the Trustee and duly executed by the owner of such
beneficial interest in the Regulation S Global Security or his attorney duly
authorized in writing, then the Trustee, as Security Registrar, shall reduce the
principal amount of the Regulation S Global Security and increase the principal
amount of the Restricted Global Security by such specified principal amount as
provided in Section 3.4(A)(c).
(iii) Restricted Non-Global Security to Restricted Global Security or
Regulation S Global Security. If the Holder of a Restricted Security (other than
a Global Security) wishes at any time to transfer all or any portion of such
Restricted Security to a Person who wishes to take delivery thereof in the form
of a beneficial interest in the Restricted Global Security or the Regulation S
Global Security, such transfer may be effected only in accordance with the
39
56
provisions of this Clause (b)(iii) and Clause (b)(v) below and subject to the
Applicable Procedures. Upon receipt by the Trustee, as Security Registrar, of
(A) such Restricted Security as provided in Section 3.5(a) and instructions
satisfactory to the Trustee directing that a beneficial interest in the
Restricted Global Security or Regulation S Global Security in a specified
principal amount not greater than the principal amount of such Security be
credited to a specified Agent Member's account and (B) a Restricted Securities
Certificate, if the specified account is to be credited with a beneficial
interest in the Restricted Global Security, or a Regulation S Certificate, if
the specified account is to be credited with a beneficial interest in the
Regulation S Global Security, in either case satisfactory to theTrustee and duly
executed by such Holder or his attorney duly authorized in writing, then the
Trustee, as Security Registrar but subject to Clause (b)(v) below, shall cancel
such Restricted Security (and issue a new Restricted Security in respect of any
untransferred portion thereof) as provided in Section 3.5(a) and increase the
principal amount of the Restricted Global Security or the Regulation S Global
Security, as the case may be, by the specified principal amount as provided in
Section 3.4(c).
(iv) Exchanges between Global Security and Non-Global Security. A
beneficial interest in a Global Security may be exchanged for a Security that is
not a Global Security as provided in Section 3.4, provided that, if such
interest is a beneficial interest in the Restricted Global Security, or if such
interest is a beneficial interest in the Regulation S Global Security and such
exchange is to occur during the Restricted Period, then such interest shall be
exchanged for a Restricted Security (subject in each case to Section 3.5(c)). A
Security that is not a Global Security may be exchanged for a beneficial
interest in a Global Security only if (A) such exchange occurs in connection
with a transfer effected in accordance with Clause (b)(iii) above.
(v) Regulation S Global Security to be Held Through Euroclear or CEDEL
during Restricted Period. The Company shall use its best efforts to cause the
Depositary to ensure that, until the expiration of the Restricted Period,
beneficial interests in the Regulation S Global Security may be held only in or
through accounts maintained at the Depositary by Euroclear or CEDEL (or by Agent
Members acting for the account thereof), and no person shall be entitled to
effect any transfer or exchange that would result in any such interest being
held otherwise than in or through such an account; provided that this Clause
(b)(v) shall not prohibit any transfer or exchange of such an interest in
accordance with Clause (b)(ii) or (iv) above.
(c) Securities Act Legends. Rule 144A Securities, Regulation D
Securities and their respective Successor Securities shall bear the applicable
Restricted Securities Legend, and the Regulation S Securities and their
Successor Securities shall bear a Regulation S Legend, subject to the following:
(i) subject to the following Clauses of this Section 3.5(c), a Security
or any portion thereof which is exchanged, upon transfer or otherwise, for a
Global Security or any portion thereof shall bear the Securities Act Legend
borne by such Global Security while represented thereby;
40
57
(ii) subject to the following Clauses of this Section 3.5(c), a new
Security which is not a Global Security and is issued in exchange for another
Security (including a Global Security) or any portion thereof, upon transfer or
otherwise, shall bear the Securities Act Legend borne by such other Security,
provided that, if such new Security is required pursuant to Section 3.5(b)(iv)
to be issued in the form of a Restricted Security, it shall bear a Restricted
Securities Legend and, if such new Security is so required to be issued in the
form of a Regulation S Security, it shall bear a Regulation S Legend;
(iii) any Securities which are sold or otherwise disposed of pursuant
to an effective registration statement under the Securities Act (including the
Shelf Registration Statement), together with their Successor Securities shall
not bear a Securities Act Legend; the Company shall inform the Trustee in
writing of the effective date of any such registration statement registering the
Securities under the Securities Act and shall notify the Trustee at any time
when prospectuses may not be delivered with respect to Securities to be sold
pursuant to such registration statement. The Trustee shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
aforementioned registration statement;
(iv) at any time after the Securities may be freely transferred without
registration under the Securities Act or without being subject to transfer
restrictions pursuant to the Securities Act, a new Security which does not bear
a Securities Act Legend may be issued in exchange for or in lieu of a Security
(other than a Global Security) or any portion thereof which bears such a legend
if the Trustee has received an Unrestricted Securities Certificate, satisfactory
to the Trustee and duly executed by the Holder of such legended Security or his
attorney duly authorized in writing, and after such date and receipt of such
certificate, the Trustee shall authenticate and deliver such a new Security in
exchange for or in lieu of such other Security as provided in this Article
Three; (v) a new Security which does not bear a Securities Act Legend may be
issued in exchange for or in lieu of a Security (other than a Global Security)
or any portion thereof which bears such a legend if, in the Company's judgment,
placing such a legend upon such new Security is not necessary to ensure
compliance with the registration requirements of the Securities Act, and the
Trustee, at the direction of the Company, shall authenticate and deliver such a
new Security as provided in this Article Three; and
(vi) notwithstanding the foregoing provisions of this Section 3.5(c), a
Successor Security of a Security that does not bear a particular form of
Securities Act Legend shall not bear such form of legend unless the Company has
reasonable cause to believe that such Successor Security is a "restricted
security" within the meaning of Rule 144, in which case the Trustee, at the
direction of the Company, shall authenticate and deliver a new Security bearing
a Restricted Securities Legend in exchange for such Successor Security as
provided in this Article Three.
(d) Neither the Trustee, the Paying Agent nor any of their agents shall
(1) have any duty to monitor compliance with or with respect to any federal or
state or other securities or tax laws or (2) have any duty to obtain
documentation on any transfers or exchanges other than as specifically required
hereunder.
41
58
SECTION 3.6. Mutilated, Destroyed, Lost or Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and make available for delivery
in exchange therefor a new Security of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there be delivered to the Company and to the Trustee:
(1) evidence to their satisfaction of the destruction, loss or theft of
any Security, and
(2) such security or indemnity as may be satisfactory to the Company
and the Trustee to save each of them and any agent of either of them harmless,
then, in the absence of actual notice to the Company or the Trustee
that such Security has been acquired by a bona fide purchaser, the
Company shall execute and the Trustee shall authenticate and deliver,
in lieu of any such destroyed, lost or stolen Security, a new Security
of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion, but
subject to any conversion rights, may, instead of issuing a new Security, pay
such Security, upon satisfaction of the conditions set forth in the preceding
paragraph.
Upon the issuance of any new Security under this Section 3.6, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto (other than any
stamp and other duties, if any, which may be imposed in connection therewith by
the United States or any political subdivision thereof or therein, which shall
be paid by the Company) and any other expenses (including the fees and expenses
of the Trustee) connected therewith.
Every new Security issued pursuant to this Section 3.6 in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and such new Security shall be entitled to all the benefits of this Indenture
equally and proportionately with any and all other Securities duly issued
hereunder.
The provisions of this Section 3.6 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies of any Holder with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.7. Payment of Interest; Interest Rights Preserved.
42
59
Interest on any Security which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Security (or one or more Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest.
Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in the following
manner. The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security, the date of the
proposed payment and the Special Record Date, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of
the proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this Clause
provided. The Special Record Date for the payment of such Defaulted Interest
shall be not more than 15 days and not less than 10 days prior to the date of
the proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to each Holder at such Holder's address as it
appears in the Security Register, not less than 10 days prior to such Special
Record Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been so mailed, such Defaulted Interest
shall be paid to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on such Special
Record Date and shall no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, if, after notice given by the Company to the Trustee of the
proposed payment pursuant to this Clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section and Section 3.5,
each Security delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
43
60
Interest on any Security which is converted in accordance with Section
12.2 during a Record Date Period shall be payable in accordance with the
provisions of Section 12.2.
SECTION 3.8. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of, premium, if any,
and (subject to Section 3.7) interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
SECTION 3.9. Cancellation.
All Securities surrendered for payment, redemption, repurchase,
registration of transfer or exchange or conversion shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee. All Securities so
delivered to the Trustee shall be canceled promptly by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
canceled as provided in this Section 3.9. The Trustee shall return all canceled
Securities to the Company.
SECTION 3.10. Computation of Interest.
Interest on the Securities (including any Liquidated Damages and
additional interest) shall be computed on the basis of a 360-day year of twelve
30-day months.
SECTION 3.11. [Reserved].
SECTION 3.12. CUSIP Numbers.
The Company in issuing Securities may use "CUSIP" numbers (if then
generally in use) in addition to serial numbers, in which case the Trustee shall
use such CUSIP numbers in addition to serial numbers in notices of redemption
and repurchase as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such CUSIP numbers
either as printed on the Securities or as contained in any notice of a
redemption or repurchase and that reliance may be placed only on the serial or
other identification numbers printed on the Securities, and any such redemption
or repurchase shall not be affected by any defect in or omission of such CUSIP
numbers.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 4.1. Satisfaction and Discharge of Indenture.
44
61
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of conversion, or registration of transfer or
exchange, or replacement of Securities herein expressly provided for and any
right to receive Liquidated Damages as provided in the form of Securities set
forth in Section 2.2 and the Company's obligations to the Trustee pursuant to
Section 6.7), and the Trustee, at the expense of the Company, shall execute
proper instruments in form and substance satisfactory to the Trustee
acknowledging satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other than
(i) Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 3.6 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or discharged from
such trust, as provided in Section 10.3) have been delivered to the Trustee for
cancellation; or
(B) all such Securities not theretofore delivered to the Trustee or its
agent for cancellation (other than Securities referred to in clauses (i) and
(ii) of clause (1)(A) above)
(i) have become due and payable, or
(ii) will have become due and payable at their Stated Maturity within
one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of redemption
by the Trustee in the name, and at the expense, of the Company, and the Company,
in the case of clause (i), (ii) or (iii) above, has deposited or caused to be
deposited with the Trustee as trust funds (immediately available to the Holders
in the case of clause (i) in trust for the purpose an amount sufficient to pay
and discharge the entire indebtedness on such Securities not theretofore
delivered to the Trustee for cancellation, for principal, premium, if any, and
interest (including any Liquidated Damages) to the date of such deposit (in the
case of Securities which have become due and payable) or to the Stated Maturity
or Redemption Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.7, the obligations of
the Company to any Authenticating Agent under Section 6.12, the obligation of
the Company to pay Liquidated Damages, if money shall have been deposited with
the Trustee pursuant to clause (1)(B) of this Section 4.1, the obligations of
the Trustee under Section 4.2 and the last paragraph of
45
62
Section 10.3 and the obligations of the Company and the Trustee under Section
3.5 and Article Twelve shall survive. Funds held in trust pursuant to this
Section are not subject to the provisions of Article Thirteen.
SECTION 4.2. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 10.3, all
money deposited with the Trustee pursuant to Section 4.1 shall be held in trust
and applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent), to the Persons entitled
thereto, of the principal, premium, if any, and interest for whose payment such
money has been deposited with the Trustee.
All monies deposited with the Trustee pursuant to Section 4.1 (and held
by it or any Paying Agent) for the payment of Securities subsequently converted
shall be returned to the Company upon Company Request.
ARTICLE FIVE
REMEDIES
SECTION 5.1. Events of Default.
"Event of Default", wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be occasioned by the provisions of Article Thirteen or be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) default in the payment of the principal of or premium, if any, on
any Security at its Maturity; or
(2) default in the payment of any interest (including any Liquidated
Damages) upon any Security when it becomes due and payable, and continuance of
such default for a period of 30 days; or
(3) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a default in
the performance or breach of which is specifically dealt with elsewhere in this
Section), and continuance of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the Holders of at least 10% in
principal amount of the Outstanding Securities a written notice specifying such
default or breach and requiring it to be remedied and stating that such notice
is a "Notice of Default" hereunder; or
46
63
(4) a default under any bond, debenture, note or other evidence of
indebtedness for money borrowed by the Company or 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 with a principal
amount then outstanding in excess of U.S.$20,000,000, whether such indebtedness
now exists or shall hereafter be created, which default shall have resulted in
such indebtedness becoming or being declared due and payable prior to the date
on which it would otherwise have become due and payable, without such
indebtedness having been discharged, or such acceleration having been rescinded
or annulled, within a period of 30 days after there shall have been given, by
registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the Holders of at least 10% in principal amount of the
Outstanding Securities a written notice specifying such default and requiring
the Company to cause such indebtedness to be discharged or cause such default to
be cured or waived or such acceleration to be rescinded or annulled and stating
that such notice is a "Notice of Default" hereunder; or
(5) the entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Company under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or order for relief or any such other decree or order unstayed
and in effect for a period of 60 consecutive days; or
(6) the commencement by the Company of a voluntary case or proceeding
under any applicable Federal or State bankruptcy, insolvency, reorganization or
other similar law or of any other case or proceeding to be adjudicated a
bankrupt or insolvent, or the consent by it to the entry of a decree or order
for relief in respect of the Company in an involuntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by it of a petition or answer or consent
seeking reorganization or similar relief under any applicable Federal or State
law, or the consent by it to the filing of such petition or to the appointment
of or taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any substantial part
of its property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its debts
generally as they become due, or the taking of corporate action by the Company
in furtherance of any such action.
SECTION 5.2. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in
Section 5.1(5) or 5.1(6)) occurs and is continuing, then in every such case the
Trustee or the Holders of not less
47
64
than 25% in principal amount of the Outstanding Securities may, subject to the
provisions of Article Thirteen, declare the principal of all the Securities to
be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by the Holders), and upon any such declaration such
principal and all accrued interest thereon shall become immediately due and
payable. If an Event of Default specified in Section 5.1(5) or 5.1(6) occurs,
the principal of, and accrued interest on, all the Securities shall, subject to
the provisions of Article Thirteen, ipso facto become immediately due and
payable without any declaration or other Act of the Holder or any act on the
part of the Trustee.
At any time after such declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article Five provided, the Holders of a
majority in principal amount of the Outstanding Securities, by written notice to
the Company and the Trustee, may rescind and annul such declaration and its
consequences if
(1) the Company has paid or deposited with the Trustee a sum sufficient
to pay
(A) all overdue interest on all Securities,
(B) the principal of and premium, if any, on any Securities
which have become due otherwise than by such declaration of acceleration and any
interest thereon at the rate borne by the Securities,
(C) to the extent permitted by applicable law, interest upon
overdue interest at a rate of 7% per annum, and
(D) all sums paid or advanced by the Trustee hereunder and
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel; and
(2) all Events of Default, other than the nonpayment of the principal
of, and any premium and interest on, Securities which have become due solely by
such declaration of acceleration, have been cured or waived as provided in
Section 5.13.
No rescission or annulment referred to above shall affect any
subsequent default or impair any right consequent thereon.
SECTION 5.3. Collection of Indebtedness and Suits for Enforcement by Trustee.
The Company covenants that if
(1) default is made in the payment of any interest (including any
Liquidated Damages) on any Security when it becomes due and payable and such
default continues for a period of 30 days, or
48
65
(2) default is made in the payment of the principal of or premium, if
any, on any Security at the Maturity thereof,
the Company will, upon demand of the Trustee but subject to the
provisions of Article Thirteen, pay to it, for the benefit of the
Holders of such Securities the whole amount then due and payable on
such Securities for principal and interest (including any Liquidated
Damages) and interest on any overdue principal and premium, if any,
and, to the extent permitted by applicable law, on any overdue interest
(including any Liquidated Damages), at a rate of 7% per annum, and in
addition thereto, such further amount as shall be sufficient to cover
the reasonable costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Securities and collect the
monies adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any such rights, whether for
the specific enforcement of any covenant or agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy.
SECTION 5.4. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or the
creditors of either, the Trustee (irrespective of whether the principal of, and
any interest on, the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company for the payment of overdue principal
or interest) shall be entitled and empowered, by intervention in such proceeding
or otherwise,
(1) to file and prove a claim for the whole amount of principal,
premium, if any, and interest owing and unpaid in respect of the Securities and
take such other actions, including participating as a member, voting or
otherwise, of any official committee of creditors appointed in such matter, and
to file such other papers or documents, in each of the foregoing cases, as may
be necessary or advisable in order to have the claims of the Trustee (including
any claim for the reasonable compensation, expenses, disbursements and advances
of the
49
66
Trustee, its agents and counsel) and of the Holders of Securities allowed in
such judicial proceeding, and
(2) to collect and receive any monies or other property payable or
deliverable on any such claim and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Holder of
Securities to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders of
Securities to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel and any other amounts due the Trustee under Section 6.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a Security
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder of a Security in any such proceeding;
provided, however, that the Trustee may, on behalf of such Holders, vote for the
election of a trustee in bankruptcy or similar official.
SECTION 5.5. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the Trustee without the possession of any of
the Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which judgment
has been recovered.
SECTION 5.6. Application of Money Collected.
Subject to Article Thirteen, any money collected by the Trustee
pursuant to this Article Five shall be applied in the following order, at the
date or dates fixed by the Trustee and, in case of the distribution of such
money on account of principal, premium, if any, or interest, upon presentation
of the Securities and the notation thereon of the payment if only partially paid
and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 6.7;
SECOND: To the payment of the amounts then due and unpaid for principal
of, premium, if any, or interest on, the Securities in respect of which or for
the benefit of which such money has been collected, ratably, without preference
or priority of any kind, according to the amounts due and payable on such
Securities for principal, premium, if any, and interest, respectively; and
THIRD: Any remaining amounts shall be repaid to the Company.
50
67
SECTION 5.7. Limitation on Suits.
No Holder of any Security shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless:
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities; it being understood and intended
that no one or more of such Holders shall have any right in any manner whatever
by virtue of, or by availing of, any provision of this Indenture to affect,
disturb or prejudice the rights of any other of such Holders, or to obtain or
seek to obtain priority or preference over any other of such Holders or to
enforce any right under this Indenture, except in the manner herein provided and
for the equal and ratable benefit of all such Holders.
SECTION 5.8. Unconditional Right of Holders to Receive Principal, Premium and
Interest and to Convert.
Notwithstanding any other provision in this Indenture, but subject to
the provisions of Article Thirteen, the Holder of any Security shall have the
right, which is absolute and unconditional, to receive payment of the principal
of, premium, if any, and (subject to Section 3.7) interest on such Security on
the respective Stated Maturities expressed in such Security (or, in the case of
redemption or repurchase, on the Redemption Date or Repurchase Date, as the case
may be), and to convert such Security in accordance with Article Twelve, and to
institute suit for the enforcement of any such payment and right to convert, and
such rights shall not be impaired without the consent of such Holder.
SECTION 5.9. Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security has instituted any
proceeding to enforce any right or remedy under this Indenture and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then and in every such
case, subject to any determination in such proceeding, the Company,
51
68
the Trustee and the Holders of Securities shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and such Holders shall continue as though no such
proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities in the last paragraph of
Section 3.6, no right or remedy herein conferred upon or reserved to the Trustee
or to the Holders of Securities is intended to be exclusive of any other right
or remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any Holder of any Security to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or any
acquiescence therein. Every right and remedy given by this Article Five or by
law to the Trustee or to the Holders of Securities may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or (subject to the
limitations contained in this Indenture) by the Holders of Securities as the
case may be.
SECTION 5.12. Control by Holders of Securities.
The Holders of a majority in principal amount of the Outstanding
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 5.13. Waiver of Past Defaults.
The Holders, either (a) through the written consent of not less than a
majority in principal amount of the Outstanding Securities, or (b) by the
adoption of a resolution, at a meeting of Holders of the Outstanding Securities
at which a quorum is present, by the Holders of (i) at least 66-2/3% in
principal amount of the Outstanding Securities represented at such meeting or
(ii) a majority in principal amount of the Outstanding Securities, may on
52
69
behalf of the Holders of all the Securities waive any past default hereunder and
its consequences, except a default (1) in the payment of the principal of,
premium, if any, or interest on any Security (including any Liquidated Damages),
or (2) in respect of a covenant or provision hereof which under Article Eight
cannot be modified or amended without the consent of the Holder of each
Outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
SECTION 5.14. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security by
his acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 5.14 shall not apply to any suit instituted by the
Company, to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in principal
amount of the Outstanding Securities, or to any suit instituted by any Holder of
any Security for the enforcement of the payment of the principal of, premium, if
any, or interest on any Security on or after the respective Stated Maturity or
Maturities expressed in such Security (or, in the case of redemption or
repurchase, on or after the Redemption Date or Repurchase Date, as the case may
be) or for the enforcement of the right to convert any Security in accordance
with Article Twelve.
SECTION 5.15. Waiver of Stay, Usury or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, usury or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede by reason of such law the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted. The
Company acknowledges and agrees that the Liquidated Damages and the other
additional interest contemplated by Section 10.12 are a reasonable estimate of
the economic harm that would be suffered by Holders of Securities as a result of
the Company's failure to comply with its obligations as set forth in The
Registration Rights Agreement and do not constitute a penalty. The Company
further agrees, to the extent permitted by law, to waive, and not assert, any
claim that the Liquidated Damages or other additional interest is a penalty.
53
70
ARTICLE SIX
THE TRUSTEE
SECTION 6.1. Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustee shall be as provided
by this Indenture and the Trust Indenture Act.
(b) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the Trustee;
and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture; but in the case of
any such certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the requirements of
this Indenture, but not to verify the contents thereof.
(c) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
(d) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(1) this paragraph (d) shall not be construed to limit the effect of
paragraph (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the Trustee
was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
Holders of a majority in principal amount of the Outstanding Securities relating
to the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred upon the
Trustee, under this Indenture; and
54
71
(4) no provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(e) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
SECTION 6.2. Notice of Defaults.
Within 90 days after the occurrence of any default hereunder as to
which the Trustee has received written notice, the Trustee shall give to all
Holders of Securities, in the manner provided in Section 1.6, notice of such
default, unless such default shall have been cured or waived; provided, however,
that, except in the case of a default in the payment of the principal of,
premium, if any, or interest on any Security, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors or Responsible Officers of the
Trustee in good faith determine that the withholding of such notice is in the
interest of the Holders; and provided, further, that in the case of any default
of the character specified in Section 5.1(3), no such notice to Holders of
Securities shall be given until at least 30 days after the occurrence thereof.
For the purpose of this Section, the term "default" means any event which is, or
after notice or lapse of time or both would become, an Event of Default.
SECTION 6.3. Certain Rights of Trustee.
Subject to the provisions of Section 6.1:
(1) the Trustee may rely and shall be protected in acting or refraining
from acting upon any resolution, Officers' Certificate, other certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, coupon, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors shall be sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in
55
72
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders of Securities pursuant to this Indenture, unless such Holders
shall have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities which might be incurred by it in compliance with
such request or direction;
(6) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, coupon, other evidence of indebtedness or other paper or document, but the
Trustee may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Company, personally or by agent or attorney;
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(8) the permissive right of the Trustee to take or refrain from taking
any actions enumerated in this Indenture shall not be construed as a duty and
the Trustee shall not be answerable in such actions other than for its own
negligence or willful misconduct; and
(9) the Trustee shall not be liable for any action taken, suffered or
omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it by the
Indenture.
SECTION 6.4. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities (except the
Trustee's certificates of authentication) shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture, of the Securities or of the Alcatel ADSs deliverable upon the
conversion of the Securities. The Trustee shall not be accountable for the use
or application by the Company of Securities or the proceeds thereof.
SECTION 6.5. May Hold Securities, Act as Trustee Under Other Indentures.
The Trustee, any Authenticating Agent, any Paying Agent, any Conversion
Agent or any other agent of the Company or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Conversion Agent or such other agent.
56
73
The Trustee may become and act as trustee under other indentures under
which other securities, or certificates of interest or participation in other
securities, of the Company are outstanding in the same manner as if it were not
Trustee hereunder.
SECTION 6.6. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed in writing with the Company.
SECTION 6.7. Compensation and Reimbursement.
The Company agrees
(1) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith; and
(3) to indemnify the Trustee (and its directors, officers, employees
and agents) for, and to hold it harmless against, any loss, liability or expense
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of this trust, including the
reasonable costs, expenses and reasonable attorneys' fees of defending itself
against any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder.
When the Trustee incurs expenses or renders services in connection with
an Event of Default specified in Section 5.1(5) or Section 5.1(6), the expenses
(including the reasonable charges of its counsel) and the compensation for the
services are intended to constitute expenses of the administration under any
applicable Federal or state bankruptcy, insolvency or other similar law.
The provisions of this Section shall survive the termination of this
Indenture or the earlier resignation or removal of the Trustee.
SECTION 6.8. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such, having a
combined capital and surplus of at least U.S.$10,000,000 in the case of the
initial Trustee hereunder and US$50,000,000 in the
57
74
case of any successor Trustee, subject to supervision or examination by federal
or state authority, in good standing and having an established place of business
in the Borough of Manhattan, The City of New York. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of said supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation shall be deemed to
be its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article and a
successor shall be appointed pursuant to Section 6.9.
SECTION 6.9. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 6.10.
(b) The Trustee may resign at any time by giving written notice thereof
to the Company. If the instrument of acceptance by a successor Trustee required
by Section 6.10 shall not have been delivered to the Trustee within 30 days
after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Securities, delivered to the
Trustee and the Company. If the instrument of acceptance by a successor Trustee
required by Section 6.10 shall not have been delivered to the Trustee within 30
days after the giving of such notice of removal, the removed Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(d) If at any time:
(1) the Trustee shall cease to be eligible under Section 6.8 and shall
fail to resign after written request therefor by the Company or by any Holder of
a Security who has been a bona fide Holder of a Security for at least six
months, or
(2) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall be
appointed or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation, then, in any such case (i) the Company by a Board Resolution may
remove the Trustee, or (ii) subject to Section 5.14, any Holder of a Security
who has been a bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board
58
75
Resolution, shall promptly appoint a successor Trustee and shall comply with the
applicable requirements of this Section and Section 6.10. If, within one year
after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee shall be appointed by Act of the Holders of a
majority in principal amount of the Outstanding Securities delivered to the
Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 6.10, become the successor Trustee and
supersede the successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders of Securities
and accepted appointment in the manner required by this Section and Section
6.10, any Holder of a Security who has been a bona fide Holder of a Security for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(f) The Company shall give notice of each resignation and each removal
of the Trustee and each appointment of a successor Trustee to all Holders of
Securities in the manner provided in Section 1.6. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.
SECTION 6.10. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute, acknowledge
and deliver to the Company and to the retiring Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee; but, on the request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder. Upon request of any such successor Trustee, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Trustee all such rights, powers and
trusts.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be eligible under this Article.
SECTION 6.11. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee
59
76
then in office, any successor by merger, conversion or consolidation to such
authenticating Trustee may adopt such authentication and deliver the Securities
so authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.
SECTION 6.12. Authenticating Agents.
The Trustee may, with the consent of the Company, appoint an
Authenticating Agent or Agents acceptable to the Company with respect to the
Securities which shall be authorized to act on behalf of the Trustee to
authenticate Securities issued upon exchange or substitution pursuant to this
Indenture.
Securities authenticated by an Authenticating Agent shall be entitled
to the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder, and every reference in
this Indenture to the authentication and delivery of Securities by the Trustee
or the Trustee's certificate of authentication shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be subject to acceptance
by the Company and shall at all times be a corporation organized and doing
business under the laws of the United States of America, any State thereof or
the District of Columbia, authorized under such laws to act as Authenticating
Agent and subject to supervision or examination by government or other fiscal
authority. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 6.12, such Authenticating Agent
shall resign immediately in the manner and with the effect specified in this
Section 6.12.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section 6.12, without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 6.12, the Trustee may appoint a successor
Authenticating Agent which shall be subject to acceptance by the Company. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section 6.12.
60
77
The Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section 6.12.
If an Authenticating Agent is appointed with respect to the Securities
pursuant to this Section 6.12, the Securities may have endorsed thereon, in
addition to or in lieu of the Trustee's certification of authentication, an
alternative certificate of authentication in the following form:
This is one of the Securities referred to in the within-mentioned
Indenture.
The Bank of New York,
as Trustee
By [Authenticating Agent],
as Authenticating Agent
By ______________________________________
Authorized Signature
Dated: __________________________________
SECTION 6.13. Disqualification; Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
SECTION 6.14. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
ARTICLE SEVEN
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
61
78
SECTION 7.1. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease all its properties and assets substantially as an
entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into the Company or convey, transfer or lease all or
substantially all of its properties and assets to the Company, unless:
(1) in case the Company shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially as
an entirety to any Person, the Person formed by such consolidation or into which
the Company is merged, or the Person which acquires by conveyance or transfer,
or which leases the properties and assets of the Company substantially as an
entirety, shall be a corporation, limited liability company, partnership or
trust, shall be organized and validly existing under the laws of the United
States of America, any State thereof or the District of Columbia and shall
expressly assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, the due and punctual payment
of the principal of, premium, if any, and interest (including Liquidated
Damages, if any, payable pursuant to Section 10.12) on all of the Securities as
applicable, and the performance or observance of every covenant of this
Indenture on the part of the Company to be performed or observed and shall have
provided for conversion rights in accordance with Article Twelve;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event that after notice or lapse of time or both, would become
an Event of Default, shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture comply with this
Article and that all conditions precedent herein provided for relating to such
transaction have been complied with, together with any documents required under
Section 8.3.
SECTION 7.2. Successor Substituted.
Upon any consolidation of the Company with, or merger of the Company
into any other Person or any conveyance, transfer or lease of all or
substantially all the properties and assets of the Company in accordance with
Section 7.1, the successor Person formed by such consolidation or into or with
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein, and thereafter, except in
the case of a lease, the predecessor Person shall be relieved of all obligations
and covenants under this Indenture and the Securities.
ARTICLE EIGHT
62
79
SUPPLEMENTAL INDENTURES
SECTION 8.1. Supplemental Indentures Without Consent of Holders of Securities.
Without the consent of any Holders of Securities the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto for any of the
following purposes:
(1) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants and obligations of the Company
herein and in the Securities as permitted by this Indenture; or
(2) to add to the covenants of the Company for the benefit of the
Holders of Securities or to surrender any right or power herein conferred upon
the Company; or
(3) to secure the Securities; or
(4) to make provision with respect to the conversion rights of Holders
of Securities pursuant to Section 12.11; or
(5) to make any changes or modifications to this Indenture necessary in
connection with the registration of any Registrable Securities under the
Securities Act as contemplated by Section 10.12, provided, such action pursuant
to this clause (5) shall not adversely affect the interests of the Holders of
Securities; or
(6) to comply with the requirements of the Trust Indenture Act or the
rules and regulations of the Commission thereunder in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act, as
contemplated by this Indenture or otherwise; or
(7) to evidence and provide for the acceptance of appointment hereunder
by a successor Trustee; or
(8) to make any change in Article Thirteen that would limit or
terminate the benefits available to any holder of Senior Indebtedness under such
Article; or
(9) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein or which is
otherwise defective, or to make any other provisions with respect to matters or
questions arising under this Indenture as the Company and the Trustee may deem
necessary or desirable, provided such action pursuant to this clause (9) shall
not adversely affect the interests of the Holders of Securities in any material
respect.
Upon Company Request, accompanied by a Board Resolution authorizing the
execution of any such supplemental indenture, and subject to and upon receipt by
the Trustee
63
80
of the documents described in Section 8.3 hereof, the Trustee shall join with
the Company in the execution of any supplemental indenture authorized or
permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained.
SECTION 8.2. Supplemental Indentures With Consent of Holders of Securities.
With either (a) the written consent of the Holders of not less than a
majority in principal amount of the Outstanding Securities, by the Act of said
Holders delivered to the Company and the Trustee, or (b) by the adoption of a
resolution, at a meeting of Holders of the Outstanding Securities at which a
quorum is present, by the Holders of (i) 66-2/3% in principal amount of the
outstanding Securities represented at such meeting or (ii) a majority in
principal amount of the Outstanding Securities, the Company, when authorized by
a Board Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders of Securities under this
Indenture; provided, however, that no such supplemental indenture shall, without
the consent or affirmative vote of the Holder of each Outstanding Security
affected thereby,
(1) change the Stated Maturity of the principal of, or any installment
of interest on, any Security, or reduce the principal amount or the rate of
interest payable thereon or any premium payable upon redemption or mandatory
repurchase thereof, or change the obligation of the Company to pay Liquidated
Damages pursuant to Section 10.12 in a manner adverse to the Holders, or change
the coin or currency in which any Security or the interest or any premium
thereon or any other amount in respect thereof is payable, or impair the right
to institute suit for the enforcement of any payment in respect of any Security
on or after the Stated Maturity thereof (or, in the case of redemption or any
repurchase, on or after the Redemption Date or Repurchase Date, as the case may
be) or, except as permitted by Section 12.11, adversely affect the right to
convert any Security as provided in Article Twelve, or modify the provisions of
this Indenture with respect to the subordination of the Securities in a manner
adverse to the Holders of Securities; or
(2) reduce the requirements of Section 9.4 for quorum or voting, or
reduce the percentage in principal amount of the Outstanding Securities the
consent of whose Holders is required for any such supplemental indenture or the
consent of whose Holders is required for any waiver (of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture; or
(3) modify the obligation of the Company to maintain an office or
agency in the Borough of Manhattan, The City of New York, pursuant to Section
10.2; or
(4) modify any of the provisions of this Section or Section 5.13 or
10.13, except to increase any percentage contained herein or therein or to
provide that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Outstanding Security affected
thereby; or
64
81
(5) modify the provisions of Article Fourteen in a manner adverse to
the Holders; or
(6) modify any of the provisions of Section 10.10 or 10.11.
It shall not be necessary for any Act of Holders of Securities under
this Section to approve the particular form of any proposed supplemental
Indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
SECTION 8.3. Execution of Supplemental Indentures.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Sections 6.1 and 6.3) shall be fully protected in relying upon,
an Opinion of Counsel stating that the execution of such supplemental indenture
is authorized or permitted by this Indenture, and that such supplemental
indenture has been duly authorized, executed and delivered by the Company and
constitutes a valid and legally binding obligation of the Company enforceable
against the Company in accordance with its terms. The Trustee may, but shall not
be obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
SECTION 8.4. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
appertaining thereto shall be bound thereby.
SECTION 8.5. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Company and the
Trustee, to any such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities.
SECTION 8.6. Notice of Supplemental Indentures.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of Section 8.2, the Company
shall give notice to all Holders of Securities of such fact, setting forth in
general terms the substance of such supplemental indenture, in the manner
provided in Section 1.6. Any failure of the Company to give such notice, or any
defect therein, shall not in any way impair or affect the validity of any such
supplemental indenture.
65
82
ARTICLE NINE
MEETINGS OF HOLDERS OF SECURITIES
SECTION 9.1. Purposes for Which Meetings May Be Called.
A meeting of Holders of Securities may be called at any time and from
time to time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Securities.
SECTION 9.2. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders of Securities
for any purpose specified in Section 9.1, to be held at such time and at such
place in the Borough of Manhattan, The City of New York, as the Trustee shall
determine. Notice of every meeting of Holders of Securities, setting forth the
time and the place of such meeting and in general terms the action proposed to
be taken at such meeting, shall be given, in the manner provided in Section 1.6,
not less than 21 nor more than 180 days prior to the date fixed for the meeting.
(b) In case at any time the Company, pursuant to a Board Resolution, or
the Holders of at least 10% in principal amount of the Outstanding Securities
shall have requested the Trustee to call a meeting of the Holders of Securities
for any purpose specified in Section 9.1, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee shall not have made the first publication of the notice of such meeting
within 21 days after receipt of such request or shall not thereafter proceed to
cause the meeting to be held as provided herein, then the Company or the Holders
of Securities in the amount specified, as the case may be, may determine the
time and the place in the Borough of Manhattan, The City of New York, for such
meeting and may call such meeting for such purposes by giving notice thereof as
provided in paragraph (a) of this Section.
SECTION 9.3. Persons Entitled to Vote at Meetings.
To be entitled to vote at any meeting of Holders of Securities, a
Person shall be (a) a Holder of one or more Outstanding Securities, or (b) a
Person appointed by an instrument in writing as proxy for a Holder or Holders of
one or more Outstanding Securities by such Holder or Holders. The only Persons
who shall be entitled to be present or to speak at any meeting of Holders shall
be the Persons entitled to vote at such meeting and their counsel, any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.
SECTION 9.4. Quorum; Action.
The Persons entitled to vote a majority in principal amount of the
Outstanding Securities shall constitute a quorum. In the absence of a quorum
within 30 minutes of the
66
83
time appointed for any such meeting, the meeting shall, if convened at the
request of Holders of Securities, be dissolved. In any other case, the meeting
may be adjourned for a period of not less than 10 days as determined by the
chairman of the meeting prior to the adjournment of such meeting. In the absence
of a quorum at any such adjourned meeting, such adjourned meeting may be further
adjourned for a period not less than 10 days as determined by the chairman of
the meeting prior to the adjournment of such adjourned meeting (subject to
repeated applications of this sentence). Notice of the reconvening of any
adjourned meeting shall be given as provided in Section 9.2(a), except that such
notice need be given only once not less than five days prior to the date on
which the meeting is scheduled to be reconvened. Notice of the reconvening of an
adjourned meeting shall state expressly the percentage of the principal amount
of the Outstanding Securities which shall constitute a quorum.
Subject to the foregoing, at the reconvening of any meeting adjourned
for a lack of a quorum, the Persons entitled to vote 25% in principal amount of
the Outstanding Securities at the time shall constitute a quorum for the taking
of any action set forth in the notice of the original meeting.
At a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid, any resolution and all matters (except as
limited by the proviso to Section 8.2 and except to the extent Section 10.13
requires a different vote) shall be effectively passed and decided if passed or
decided by the Persons entitled to vote not less than 66-2/3% in principal
amount of Outstanding Securities represented and entitled to vote at such
meeting.
Any resolution passed or decisions taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all the
Holders of Securities whether or not present or represented at the meeting. The
Trustee shall, in the name and at the expense of the Company, notify all the
Holders of Securities of any such resolutions or decisions pursuant to Section
1.6.
SECTION 9.5. Determination of Voting Rights; Conduct and Adjournment of
Meetings.
(a) Notwithstanding any other provisions of this Indenture, the Trustee
may make such reasonable regulations as it may deem advisable for any meeting of
Holders of Securities in regard to proof of the holding of Securities and of the
appointment of proxies and in regard to the appointment and duties of inspectors
of votes, the submission and examination of proxies, certificates and other
evidence of the right to vote, and such other matters concerning the conduct of
the meeting as it shall deem appropriate. Except as otherwise permitted or
required by any such regulations, the holding of Securities shall be proved in
the manner specified in Section 1.4 and the appointment of any proxy shall be
proved in the manner specified in Section 1.4 or by having the signature of the
Person executing the proxy guaranteed by any bank, broker or other eligible
institution participating in a recognized medallion signature guarantee program.
67
84
(b) The Trustee shall, by an instrument in writing, appoint a temporary
chairman (which may be the Trustee) of the meeting, unless the meeting shall
have been called by the Company or by Holders of Securities as provided in
Section 9.2(b), in which case the Company or the Holders of Securities calling
the meeting, as the case may be, shall in like manner appoint a temporary
chairman. A permanent chairman and a permanent secretary of the meeting shall be
elected by vote of the Persons entitled to vote a majority in principal amount
of the Outstanding Securities represented at the meeting.
(c) At any meeting, each Holder of a Security or proxy shall be
entitled to one vote for each U.S.$1,000 principal amount of Securities held or
represented by him; provided, however, that no vote shall be cast or counted at
any meeting in respect of any Security challenged as not Outstanding and ruled
by the chairman of the meeting to be not Outstanding. The chairman of the
meeting shall have no right to vote, except as a Holder of a Security or proxy.
(d) Any meeting of Holders of Securities duly called pursuant to
Section 9.2 at which a quorum is present may be adjourned from time to time by
Persons entitled to vote a majority in principal amount of the Outstanding
Securities represented at the meeting, and the meeting may be held as so
adjourned without further notice.
SECTION 9.6. Counting Votes and Recording Action of Meetings.
The vote upon any resolution submitted to any meeting of Holders of
Securities shall be by written ballots on which shall be subscribed the
signatures of the Holders of Securities or of their representatives by proxy and
the principal amounts at Stated Maturity and serial numbers of the Outstanding
Securities held or represented by them. The permanent chairman of the meeting
shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all
votes cast at the meeting. A record, at least in duplicate, of the proceedings
of each meeting of Holders of Securities shall be prepared by the secretary of
the meeting and there shall be attached to said record the original reports of
the inspectors of votes on any vote by ballot taken thereat and affidavits by
one or more Persons having knowledge of the facts setting forth a copy of the
notice of the meeting and showing that said notice was given as provided in
Section 9.2 and, if applicable, Section 9.4. Each copy shall be signed and
verified by the affidavits of the permanent chairman and secretary of the
meeting and one such copy shall be delivered to the Company and another to the
Trustee to be preserved by the Trustee, the latter to have attached thereto the
ballots voted at the meeting. Any record so signed and verified shall be
conclusive evidence of the matters therein stated.
ARTICLE TEN
COVENANTS
SECTION 10.1. Payment of Principal, Premium and Interest.
68
85
The Company covenants and agrees that it will duly and punctually pay
the principal of and premium, if any, and interest on the Securities in
accordance with the terms of the Securities and this Indenture. The Company will
deposit or cause to be deposited with the Trustee, no later than one Business
Day prior to the date of the Stated Maturity of any Security or no later than
one Business Day prior to the due date for any installment of interest, all
payments so due, which payments shall be in immediately available funds on the
date of such Stated Maturity or due date, as the case may be.
SECTION 10.2. Maintenance of Offices or Agencies.
The Company hereby appoints the Corporate Trust Office of the Trustee
as its agent in the Borough of Manhattan, The City of New York, where Securities
may be presented or surrendered for payment, where Securities may be surrendered
for registration of transfer or exchange, where Securities may be surrendered
for conversion, and where notices and demands to or upon the Company in respect
of the Securities and this Indenture may be served.
The Company may at any time and from time to time vary or terminate the
appointment of any such agent or appoint any additional agents for any or all of
such purposes; provided, however, that until all of the Securities have been
delivered to the Trustee for cancellation, or monies sufficient to pay the
principal of, premium, if any, and interest on the Securities have been made
available for payment and either paid or returned to the Company pursuant to the
provisions of Section 10.3, the Company will maintain in the Borough of
Manhattan, The City of New York, an office or agency where Securities may be
presented or surrendered for payment and conversion, where Securities may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Company will give prompt written notice to the Trustee, and
notice to the Holders in accordance with Section 1.6, of the appointment or
termination of any such agents and of the location and any change in the
location of any such office or agency.
If at any time the Company shall fail to maintain any such required
office or agency, or shall fail to furnish the Trustee with the address thereof,
presentations and surrenders may be made and notices and demands may be served
on the Corporate Trust Office of the Trustee.
SECTION 10.3. Money for Security Payments To Be Held in Trust.
If the Company shall act as its own Paying Agent, it will, on or before
each due date of the principal of, premium, if any, or interest on any of the
Securities, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal, premium, if any, or interest so
becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and the Company will promptly notify the Trustee of its
action or failure so to act.
69
86
Whenever the Company shall have one or more Paying Agents, it will, no
later than one Business Day prior to each due date of the principal of, premium,
if any, or interest on any Securities, deposit with the Trustee a sum sufficient
to pay the principal, premium, if any, or interest so becoming due, such sum to
be held for the benefit of the Persons entitled to such principal, premium, if
any, or interest, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of any failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of,
premium, if any, or interest on Securities for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any other
obligor upon the Securities) in the making of any payment of principal, premium,
if any, or interest; and
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held by
such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, premium, if any,
or interest on any Security and remaining unclaimed for two years after such
principal, premium, if any, or interest has become due and payable shall be paid
to the Company on Company Request, or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Security shall thereafter, as
an unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to
be published once, in an Authorized Newspaper in each Place of Payment, notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 10.4. [Reserved].
70
87
SECTION 10.5. Existence.
Subject to Article Seven, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence,
rights (charter and statutory) and corporate power and authority; provided,
however, that the Company shall not be required to preserve any such right or
franchise if the Board of Directors shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Company and
that the loss thereof is not disadvantageous in any material respect to the
Holders.
SECTION 10.6. Maintenance of Properties.
The Company will cause all material properties used or useful in the
conduct of its business or the business of any Subsidiary to be maintained and
kept in good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary and not disadvantageous in any
material respect to the Holders.
SECTION 10.7. Payment of Taxes and Other Claims.
The Company will pay or discharge, or cause to be paid or discharged,
before the same may become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, (2) all
claims for labor, materials and supplies which, if unpaid, might by law become a
lien or charge upon the property of the Company or any Subsidiary, and (3) all
stamps and other duties, if any, which may be imposed by the United States or
any political subdivision thereof or therein in connection with the issuance,
transfer, exchange or conversion of any Securities or with respect to this
Indenture; provided, however, that, in the case of clauses (1) and (2), the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim (a) if the failure to do so
will not, in the aggregate, have a material adverse impact on the Company, or
(b) if the amount, applicability or validity is being contested in good faith by
appropriate proceedings.
SECTION 10.8. Registration and Listing.
Prior to the Exchange Date, the Company (i) will effect all
registrations with, and obtain all approvals by, all governmental authorities
that may be necessary under any United States Federal or state law (including
the Securities Act, the Exchange Act and state securities and Blue Sky laws)
before the Alcatel ADSs deliverable upon conversion of Securities may be
lawfully delivered, and qualified or listed as contemplated by clause (ii) (it
being understood that the Company shall not be required to register the
Securities under the
71
88
Securities Act, except pursuant to the Registration Rights Agreement referred to
in Section 10.12); and (ii) will qualify the Alcatel ADSs required to be
delivered upon conversion of Securities, prior to such delivery, for quotation
on the Nasdaq National Market or, if the Alcatel ADSs are not then quoted on the
Nasdaq National Market, list the Alcatel ADSs on each national securities
exchange on which outstanding Alcatel ADSs are listed or quoted at the time of
such delivery. Nothing in this Section 10.8 will limit the application of
Section 10.12.
SECTION 10.9. Statement by Officers as to Default.
The Company shall deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
The Company will deliver to the Trustee, forthwith upon becoming aware
of any default in the performance or observance of any covenant, agreement or
condition contained in this Indenture, or any Event of Default, an Officers'
Certificate specifying with particularity such default or Event of Default and
further stating what action the Company has taken, is taking or proposes to take
with respect thereto.
Any notice required to be given under this Section 10.9 shall be
delivered to the Trustee at its Corporate Trust Office.
SECTION 10.10. Delivery of Certain Information.
At any time when the Company is not subject to Section 13 or 15(d) of
the Exchange Act, upon the request of a Holder of a Restricted Security or the
holder of Alcatel ADSs delivered upon conversion thereof, the Company will
promptly furnish or cause to be furnished Rule 144A Information (as defined
below) to such Holder of Restricted Securities or such holder of Alcatel ADSs
delivered upon conversion of Restricted Securities, or to a prospective
purchaser of any such security designated by any such Holder or holder, as the
case may be, to the extent required to permit compliance by such Holder or
holder with Rule 144A under the Securities Act (or any successor provision
thereto) in connection with the resale of any such security; provided, however,
that the Company shall not be required to furnish such information in connection
with any request made on or after the date which is two years from the later of
(i) the date such a security (or any such predecessor security) was last
acquired from the Company or (ii) the date such a security (or any such
predecessor security) was last acquired from an "affiliate" of the Company
within the meaning of Rule 144 under the Securities Act (or any successor
provision thereto). "Rule 144A Information" shall be such information as is
specified pursuant to Rule 144A(d)(4) under the Securities Act (or any successor
provision thereto).
72
89
SECTION 10.11. Resale of Certain Securities; Reporting Issuer.
During the period beginning on the last date of original issuance of
the Securities and ending on the date that is two years from such date, the
Company will not, and will not permit any of its subsidiaries or other
"affiliates" (as defined under Rule 144 under the Securities Act or any
successor provision thereto) controlled by it to, resell (x) any Securities
which constitute "restricted securities" under Rule 144 or (y) any securities
into which the Securities have been converted under this Indenture which
constitute "restricted securities" under Rule 144, that in either case have been
reacquired by any of them. The Trustee shall have no responsibility in respect
of the Company's performance of its agreement in the preceding sentence.
SECTION 10.12. Registration Rights.
The Company agrees that the Holders from time to time of Registrable
Securities (as defined below) are entitled to the benefits of a Registration
Rights Agreement, dated as of August 7, 1997 (the "Registration Rights
Agreement"), executed by the Company. Pursuant to the Registration Rights
Agreement, the Company has agreed for the benefit of the Holders from time to
time of Registrable Securities, at the Company's expense, (i) to file within 90
calendar days after the first date of original issuance of the Securities, a
shelf registration statement (the "Shelf Registration Statement") with the
Commission with respect to resales of the Registrable Securities, (ii)
thereafter use reasonable efforts to cause such Shelf Registration Statement to
be declared effective by the Commission within 90 days after the filing of such
Shelf Registration Statement, and (iii) to use reasonable efforts to maintain
such Shelf Registration Statement continuously effective under the Securities
Act of 1933, as amended, until a period of two years from the last date of
original issuance of the Securities or, if earlier, until (1) there are no
outstanding Registrable Securities or (2) when, in the written opinion of
independent counsel to the Company, all outstanding Registrable Securities held
by persons that are not "affiliates" of the Company (as defined in Rule
144(a)(1) under the Securities Act) may be resold without registration under the
Securities Act pursuant to Rule 144(k) under the Securities Act (or any
successor provision thereto) and the Company has removed all legends from the
Registrable Securities restricting the transfer thereof (other than any
Registrable Security held by an affiliate).
If (i) on or prior to 90 days following the date of original issuance
of the Registered Securities, a Shelf Registration Statement has not been filed
with the Commission, or (ii) on or prior to the 90th day following such filing,
such Shelf Registration Statement is not declared effective (each, a
"Registration Default"), additional interest ("Liquidated Damages") will accrue
on the Registered Securities from and including the day following such
Registration Default to but excluding the day on which such Registration Default
has been cured. Liquidated Damages will be paid semi-annually in arrears, with
the first semi-annual payment due on the first Interest Payment Date in respect
of the Registered Securities following the date on which such Liquidated Damages
begin to accrue, and will accrue at a rate per annum equal to an additional
one-quarter of one percent (.25%) of the principal amount of the Registered
Securities to and including the 90th day following such Registration Default and
at a rate per annum equal to one-half of one percent (.50%) thereof
73
90
from and after the 91st day following such Registration Default. In the event
that the Shelf Registration Statement ceases to be effective (or the Holders are
otherwise prevented or restricted by the Company from effecting sales pursuant
thereto) prior to the third annual anniversary of the initial effective date of
the Shelf Registration Statement or such earlier date as is provided in the
Registration Rights Agreement for a period in excess of 60 days, whether or not
consecutive, during any 12-month period (an "Effectiveness Failure"), then the
interest rate borne by the Registered Securities shall increase by an additional
one-half of one percent (.50%) per annum on the 61st day of the applicable
12-month period such Shelf Registration Statement ceases to be effective (or the
Holders are otherwise prevented or restricted by the Company from effecting
sales pursuant thereto) to but excluding the day on which the Effectiveness
Failure is cured. For the purposes of determining an Effectiveness Failure, days
on which the Company has been obligated to pay Liquidated Damages in respect of
a prior Effectiveness Failure within the applicable 12 month period will not be
included.
Whenever in this Indenture there is mentioned, in any context, the
payment of the principal of, premium, if any, or interest on, or in respect of,
any Registered Security, such mention shall be deemed to include mention of the
payment of Liquidated Damages provided for in this Section to the extent that,
in such context, Liquidated Damages are, were or would be payable in respect
thereof pursuant to the provisions of this Section, and express mention of the
payment of Liquidated Damages (if applicable) in any provisions hereof shall not
be construed as excluding Liquidated Damages in those provisions hereof where
such express mention is not made.
For the purposes of the Registration Rights Agreement, "Registrable
Securities" means all or any portion of the Registered Securities issued from
time to time under this Indenture and the Alcatel ADSs deliverable upon
conversion of such Securities provided, however, that a Security or the Alcatel
ADSs deliverable upon conversion of a Security ceases to be a Registrable
Security when it (i) has been effectively registered under the Securities Act
and sold in a manner contemplated by the Shelf Registration Statement or (ii)
has been transferred in compliance with Rule 144 under the Securities Act (or
any successor provisions thereto).
If a Security, or the Alcatel ADSs deliverable upon conversion of a
Security, is a Registrable Security, and the Holder thereof elects to sell such
Registrable Security pursuant to the Shelf Registration Statement then, by its
acceptance thereof, the Holder of such Registrable Security will have agreed to
be bound by the terms of the Registration Rights Agreement relating to the
Registrable Securities which are the subject of such election.
For the purposes of the Registration Rights Agreement, the term
"Holder" includes any Person that has a beneficial interest in any Global
Security or any beneficial interest in a global security representing Alcatel
ADSs deliverable upon conversion of a Security.
SECTION 10.13. Waiver of Certain Covenants.
74
91
The Company may omit in any particular instance to comply with any
covenant or conditions set forth in Sections 10.5 to 10.7, inclusive (other than
a covenant or condition which under Article Eight cannot be modified or amended
without the consent of the Holder of each Outstanding Security affected), if
before the time for such compliance the Holders shall, through the written
consent of, or the adoption of a resolution at a meeting of Holders of the
Outstanding Securities at which a quorum is present by, not less than a majority
in principal amount of the Outstanding Securities, either waive such compliance
in such instance or generally waive compliance with such covenant or condition,
but no such waiver shall extend to or affect such covenant or condition except
to the extent so expressly waived, and, until such waiver shall become
effective, the obligations of the Company and the duties of the Trustee or any
Paying or Conversion Agent in respect of any such covenant or condition shall
remain in full force and effect.
ARTICLE ELEVEN
REDEMPTION OF SECURITIES
SECTION 11.1. Right of Redemption.
The Securities may be redeemed in accordance with the provisions of the
forms of Securities set forth in Section 2.2.
SECTION 11.2. Applicability of Article.
Redemption of Securities at the election of the Company or otherwise,
as permitted or required by any provision of the Securities or this Indenture
(other than a redemption upon a Change in Control), shall be made in accordance
with such provision and this Article Eleven.
SECTION 11.3. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced
by a Board Resolution. In case of any redemption at the election of the Company
of any of the Securities, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee in writing of such Redemption
Date. If the Securities are to be redeemed pursuant to an election of the
Company which is subject to a condition specified in the form of Securities set
forth in Section 2.2, the Company shall furnish the Trustee with an Officers'
Certificate stating that the Company is entitled to effect such redemption and
setting forth a statement of facts showing that the conditions precedent to the
right of the Company so to redeem have occurred.
SECTION 11.4. Selection by Trustee of Securities To Be Redeemed.
75
92
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected by the Trustee within two Business
Days after it receives the notice described in 11.3, from the Outstanding
Securities not previously called for redemption by such method as the Trustee
may deem fair and appropriate.
If any Registered Security selected for partial redemption is converted
in part before termination of the conversion right with respect to the portion
of the Security so selected, the converted portion of such Security shall be
deemed (so far as may be) to be the portion selected for redemption. Securities
which have been converted during a selection of Securities to be redeemed may be
treated by the Trustee as Outstanding for the purpose of such selection.
The Trustee shall promptly notify the Company and each Security
Registrar in writing of the securities selected for redemption and, in the case
of any Securities selected for partial redemption, the principal amount thereof
to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
SECTION 11.5. Notice of Redemption.
Notice of redemption shall be given in the manner provided in Section
1.6 to the Holders of Securities to be redeemed not less than 30 nor more than
60 days prior to the Redemption Date, and such notice shall be irrevocable.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price, and accrued interest, if any,
(3) if less than all Outstanding Securities are to be redeemed, the
aggregate principal amount of Securities to be redeemed and the aggregate
principal amount of Securities which will be outstanding after such partial
redemption,
(4) that on the Redemption Date the Redemption Price, and accrued
interest, if any, will become due and payable upon each such Security to be
redeemed, and that interest thereon shall cease to accrue on and after said
date,
(5) the Conversion Price, the date on which the right to convert the
Securities to be redeemed will terminate and the places where such Securities,
may be surrendered for conversion, and
(6) the place or places where such Securities, are to be surrendered
for payment of the Redemption Price and accrued interest, if any.
76
93
In case of a partial redemption, the first notice given shall specify
the last date on which exchanges or transfers of Securities may be made pursuant
to Section 3.5 and the second notice shall specify the serial and CUSIP numbers
(if any) and the portions thereof called for redemption.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's written request,
by the Trustee in the name of and at the expense of the Company. Notice of
redemption of Securities to be redeemed at the election of the Company received
by the Trustee shall be given by the Trustee to each Paying Agent in the name of
and at the expense of the Company.
SECTION 11.6. Deposit of Redemption Price.
Not less than one Business Day prior to any Redemption Date, the
Company shall deposit with the Trustee (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 10.3) an amount
of money (which shall be in immediately available funds on such Redemption Date)
sufficient to pay the Redemption Price of, and (except if the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Securities which
are to be redeemed on that date other than any Securities called for redemption
on that date which have been converted prior to the date of such deposit.
If any Security called for redemption is converted, any money deposited
with the Trustee or so segregated and held in trust for the redemption of such
Security shall (subject to any right of the Holder of such Security or any
Predecessor Security to receive interest as provided in the last paragraph of
Section 3.7) be paid to the Company on Company Request or, if then held by the
Company, shall be discharged from such trust.
SECTION 11.7. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities so
to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall default in the payment of the Redemption Price, including accrued
interest) such Securities shall cease to bear interest. Upon surrender of any
Security for redemption in accordance with said notice such Security shall be
paid by the Company at the Redemption Price together with accrued and unpaid
interest to the Redemption Date; provided, however, that installments of
interest on Securities whose Stated Maturity is on or prior to the Redemption
Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such on the relevant Record Date according
to their terms and the provisions of Section 3.7.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal amount of, premium, if any, and,
to the extent permitted by applicable law, accrued interest on such Security
shall, until paid, bear interest from the Redemption Date at a rate of 7% per
annum and such Security shall remain convertible until the principal of such
Security (or portion thereof, as the case may be) shall have been paid or duly
provided for.
77
94
SECTION 11.8. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be surrendered
at an office or agency of the Company designated for that purpose pursuant to
Section 10.2 (with, if the Company or the Trustee so requires, due endorsement
by, or a written instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder thereof or his attorney duly authorized
in writing), and the Company shall execute, and the Trustee shall authenticate
and make available for delivery to the Holder of such Security without service
charge, a new Registered Security or Securities, of any authorized denomination
as requested by such Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Security so
surrendered.
ARTICLE TWELVE
CONVERSION OF SECURITIES
SECTION 12.1. Conversion Privilege and Conversion Price.
Subject to and upon compliance with the provisions of this Article, at
the option of the Holder thereof, any Security may be converted into Alcatel
ADSs (calculated as to each conversion to the nearest 1/100th of an Alcatel ADS)
at the Conversion Price, determined as hereinafter provided, in effect at the
time of conversion. Such conversion right shall commence on the 90th day after
the last original issue date of the Notes and expire at the close of business on
August 1, 2004, subject, in the case of conversion of any Global Security, to
any Applicable Procedures. In case a Security or portion thereof is called for
redemption at the election of the Company or the Holder thereof exercises his
right to require the Company to repurchase the Security, such conversion right
in respect of the Security, or portion thereof so called, shall expire at the
close of business on the fifth Trading Day preceding the Redemption Date or the
second Trading Day preceding the Repurchase Date, as the case may be, unless the
Company defaults in making the payment due upon redemption or repurchase, as the
case may be (in each case subject as aforesaid to any Applicable Procedures with
respect to any Global Security).
The price at which Alcatel ADSs shall be delivered upon conversion
(herein called the "Conversion Price") shall be initially U.S.$61.012 per
Alcatel ADS. The Conversion Price shall be adjusted in certain instances as
provided in this Article Twelve.
SECTION 12.2. Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the Holder of any
Security to be converted shall surrender such Security, duly endorsed or
assigned to the Company or in blank, at any office or agency of the Company
maintained for that purpose pursuant to Section 10.2, accompanied by a duly
signed conversion notice substantially in the form set forth in Section 2.5
stating that the Holder elects to convert such Security or, if less than the
entire principal amount thereof is to be converted, the portion thereof to be
converted. Each Security surrendered for conversion (in whole or in part) during
the period from the close of
78
95
business on any Regular Record Date next preceding any Interest Payment Date to
the opening of business on such Interest Payment Date shall (except in the case
of any Security or portion thereof which has been called for redemption or is to
be repurchased and, as a result, the right to convert such Security would
terminate during such period) be accompanied by payment in New York Clearing
House funds or other funds acceptable to the Company of an amount equal to the
interest payable on such Interest Payment Date on the principal amount of such
Security (or part thereof, as the case may be) being surrendered for conversion.
The interest so payable on such Interest Payment Date with respect to any
Security (or portion thereof, if applicable) which has been called for
redemption, or is to be repurchased, and as a result the right to convert such
Security (or portion thereof, if applicable) would terminate during the period
from the close of business on any Record Date next preceding any Interest
Payment Date to the opening of business on such Interest Payment Date, which
Security (or portion thereof, if applicable) is surrendered for conversion
during such period, shall be paid to the Holder of such Security being converted
in an amount equal to the interest that would have been payable on such Security
if such Security had been converted as of the close of business on such Interest
Payment Date. The interest so payable on such Interest Payment Date in respect
of any Security (or portion thereof, as the case may be) which has not been
called for redemption on a Redemption Date, or is not eligible for repurchase on
a Repurchase Date, that, in either case, would cause the right to convert such
Security to terminate during the period from the close of business on any Record
Date next preceding any Interest Payment Date to the opening of business on such
Interest Payment Date, which Security (or portion thereof, as the case may be)
is surrendered for conversion during such period, shall be paid to the Holder of
such Security as of such Regular Record Date. Interest payable in respect of any
Security surrendered for conversion on or after an Interest Payment Date shall
be paid to the Holder of such Security as of the next preceding Regular Record
Date, notwithstanding the exercise of the right of conversion. Except as
provided in this paragraph and subject to the last paragraph of Section 3.7, no
cash payment or adjustment shall be made upon any conversion on account of any
interest accrued from the Interest Payment Date next preceding the conversion
date, in respect of any Security (or part thereof, as the case may be)
surrendered for conversion, or on account of any dividends on the Alcatel ADSs
delivered upon conversion. The Company's delivery to the Holder of the number of
Alcatel ADSs (and cash in lieu of fractions thereof, as provided in this
Indenture) into which a Security is convertible will be deemed to satisfy the
Company's obligation to pay the principal amount of the Security.
Securities shall be deemed to have been converted immediately prior to
the close of business on the day of surrender of such Securities for conversion
in accordance with the foregoing provisions, and at such time the rights of the
Holders of such Securities as Holders shall cease, and the Person or Persons
entitled to receive the Alcatel ADSs deliverable upon conversion shall be
treated for all purposes as the record holder or holders of such Alcatel ADSs at
such time. As promptly as practicable on or after the conversion date, the
Company shall issue and deliver to the Trustee, for delivery to the Holder, a
certificate or certificates for the number of full Alcatel ADSs deliverable upon
conversion, together with payment in lieu of any fraction of an Alcatel ADS, as
provided in Section 12.3.
79
96
All Alcatel ADSs delivered upon such conversion of Restricted
Securities shall bear restrictive legends substantially in the form of the
legends required to be set forth on the Restricted Securities pursuant to
Section 3.5 and shall be subject to the restrictions on transfer provided in
such legends. Neither the Trustee nor any agent maintained for the purpose of
such conversion shall have any responsibility for the inclusion or content of
any such restrictive legends on such Alcatel ADSs; provided, however, that the
Trustee or any agent maintained for the purpose of such conversion shall have
provided, to the Company or to the Company's transfer agent for such Alcatel
ADSs, prior to or concurrently with a request to the Company to deliver such
Alcatel ADSs, written notice that the Securities delivered for conversion are
Restricted Securities.
In the case of any Security which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to the Holder thereof, at the expense of the Company, a new Registered
Security or Securities of authorized denominations in an aggregate principal
amount equal to the unconverted portion of the principal amount of such
Security. A Security may be converted in part, but only if the principal amount
of such Security to be converted is any integral multiple of U.S.$1,000 and the
principal amount of such security to remain Outstanding after such conversion is
equal to U.S.$1,000 or any integral multiple of $1,000 in excess thereof.
If Alcatel ADSs to be delivered upon conversion of a Restricted
Security, or Registered Securities to be issued upon conversion of a Restricted
Security in part only, are to be registered in a name other than that of the
beneficial owner of such Restricted Security, then such Holder must deliver to
the Conversion Agent a Surrender Certificate, dated the date of surrender of
such Restricted Security and signed by such beneficial owner, as to compliance
with the restrictions on transfer applicable to such Restricted Security.
Neither the Trustee nor any Conversion Agent, Registrar or Transfer Agent shall
be required to register in a name other than that of the beneficial owner,
Alcatel ADSs or Securities delivered upon conversion of any such Restricted
Security not so accompanied by a properly completed Surrender Certificate.
SECTION 12.3. Fractions of Alcatel ADSs.
No fractional Alcatel ADSs shall be delivered upon conversion of any
Security or Securities. If more than one Security shall be surrendered for
conversion at one time by the same Holder, the number of full Alcatel ADSs which
shall be deliverable upon conversion thereof shall be computed on the basis of
the aggregate principal amount of the Securities (or specified portions thereof)
so surrendered. Instead of any fractional Alcatel ADSs which would otherwise be
deliverable upon conversion of any Security or Securities (or specified portions
thereof), the Company shall calculate and pay a cash adjustment in respect of
such fraction (calculated to the nearest 1/100th of an Alcatel ADS) in an amount
equal to the same fraction of the Closing Price Per Alcatel ADS at the close of
business on the day of conversion.
SECTION 12.4. Adjustment of Conversion Price.
80
97
The Conversion Price shall be subject to adjustments from time to time
as follows:
(1) In case Alcatel shall pay or make a dividend or other
distribution on any class of capital stock of Alcatel payable in shares
of Common Stock, the Conversion Price in effect at the opening of
business on the day following the date fixed for the determination of
stockholders entitled to receive such dividend or other distribution
shall be reduced by multiplying such Conversion Price by a fraction of
which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such
determination and the denominator shall be the sum of such number of
shares and the total number of shares constituting such dividend or
other distribution, such reduction to become effective immediately
after the opening of business on the day following the date fixed for
such determination. If, after any such date fixed for determination,
any dividend or distribution is not in fact paid, the Conversion Price
shall be immediately readjusted, effective as of the date the
determination is made not to pay such dividend or distribution, to the
Conversion Price that would have been in effect if such determination
date had not been fixed. For the purposes of this paragraph (1), the
number of shares of Common Stock at any time outstanding shall not
include shares held in the treasury of Alcatel but shall include shares
issuable in respect of scrip certificates issued in lieu of fractions
of such shares. Alcatel will not pay any dividend or make any
distribution on shares held in the treasury of Alcatel.
(2) In case Alcatel shall issue rights, options or warrants to
all holders of its Common Stock entitling them to subscribe for or
purchase shares of Common Stock such that the price per Alcatel ADS
would be less than the current market price per Alcatel ADS (determined
as provided in paragraph (8) of this Section 12.4) on the date fixed
for the determination of stockholders entitled to receive such rights,
options or warrants (other than any rights, options or warrants that by
their terms will also be issued to any Holder upon conversion of a
Security into Alcatel ADSs without any action required by the Company
or any other Person), the Conversion Price in effect at the opening of
business on the day following the date fixed for such determination
shall be reduced by multiplying such Conversion Price by a fraction of
which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock which the
aggregate of the offering price of the total number of shares of Common
Stock so offered for subscription or purchase would purchase at such
current market price and the denominator shall be the number of shares
of Common Stock outstanding at the close of business on the date fixed
for such determination plus the number of shares of Common Stock so
offered for subscription or purchase, such reduction to become
effective immediately after the opening of business on the day
following the date fixed for such determination. If, after any such
date fixed for determination, any such rights, options or warrants are
not in fact issued, the Conversion Price shall be immediately
readjusted, effective as of the date the determination is made not to
issue such rights, options or warrants, to the Conversion Price that
would have been in effect if such determination date had not been
fixed. For the purposes of this paragraph (2), the number of shares of
Common
81
98
Stock at any time outstanding shall not include shares held in the
treasury of Alcatel but shall include shares issuable in respect of
scrip certificates issued in lieu of fractions of shares of Common
Stock. Alcatel will not issue any rights, options or warrants in
respect of shares of Common Stock held in the treasury of Alcatel.
(3) In case the ratio of Alcatel ADSs to shares of Common
Stock shall be modified such that each Alcatel ADS no longer represents
one-fifth of one ordinary share of Common Stock, the Conversion Price
in effect at the opening of business on the day following the day upon
which such modification becomes effective shall be proportionally
adjusted, such adjustment to become effective immediately after the
opening of business on the day following the day upon which such
modification becomes effective.
(4) In case Alcatel shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its
indebtedness, shares of any class of capital stock, or other property
(including securities, but excluding (i) any rights, options or
warrants referred to in paragraph (2) of this Section, (ii) any
dividend or distribution paid exclusively in cash, (iii) any dividend
or distribution referred to in paragraph (1) of this Section and (iv)
any merger or consolidation to which Section 12.11 applies), the
Conversion Price shall be adjusted so that the same shall equal the
price determined by dividing the Conversion Price in effect immediately
prior to the close of business on the date fixed for the determination
of stockholders entitled to receive such distribution by a fraction of
which the numerator shall be the current market price per Alcatel ADS
(determined as provided in paragraph (8) of this Section 12.4) on the
date fixed for such determination less the then fair market value (as
determined by the authorized officer of Alcatel, whose determination
shall be conclusive and filed with the Trustee) of the portion of the
assets, shares or evidences of indebtedness so distributed applicable
to one Alcatel ADS and the denominator shall be such current market
price per Alcatel ADS, such adjustment to become effective immediately
prior to the opening of business on the day following the date fixed
for the determination of stockholders entitled to receive such
distribution. If, after any such date fixed for determination, any such
distribution is not in fact made, the Conversion Price shall be
immediately readjusted, effective as of the date the determination is
made not to make such distribution, to the Conversion Price that would
have been in effect if such determination date had not been fixed.
(5) In case Alcatel shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding any cash
that is distributed upon a merger or consolidation to which Section
12.11 applies or as part of a distribution referred to in paragraph (4)
of this Section) in an aggregate amount that, combined together with
(I) the aggregate amount of any other cash distributions to all holders
of its Common Stock made exclusively in cash within the 12 months
preceding the date of payment of such distribution and in respect of
which no adjustment pursuant to this paragraph (5) has been made and
(II) the aggregate of any cash plus the fair market value (as
determined by the authorized officer of Alcatel, whose determination
shall be conclusive) of consideration payable in respect of any tender
offer by Alcatel or any
82
99
of its subsidiaries for all or any portion of the Alcatel ADSs
concluded within the 12 months preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to
paragraph (6) of this Section 12.4 has been made (the "combined cash
and tender amount") exceeds 12.5% of the product of the current market
price per Alcatel ADS (determined as provided in paragraph (8) of this
Section 12.4) on the date for the determination of holders of shares of
Common Stock entitled to receive such distribution times the number of
Alcatel ADSs which would have to be issued to reflect all shares of
Common Stock outstanding on such date (the "aggregate current market
price"), then, and in each such case, immediately after the close of
business on such date for determination, the Conversion Price shall be
adjusted so that the same shall equal the price determined by dividing
the Conversion Price in effect immediately prior to the close of
business on the date fixed for determination of the stockholders
entitled to receive such distribution by a fraction (i) the numerator
of which shall be equal to the current market price per Alcatel ADS
(determined as provided in paragraph (8) of this Section) on the date
fixed for such determination less an amount equal to the quotient of
(x) the excess of such combined cash and tender amount over such
aggregate current market price divided by (y) the number of Alcatel
ADSs which would have to be issued to reflect all shares of Common
Stock outstanding on such date for determination and (ii) the
denominator of which shall be equal to the current market price per
Alcatel ADS (determined as provided in paragraph (8) of this Section
12.4) on such date for determination.
(6) In case a tender offer made by Alcatel or any Subsidiary
for all or any portion of the Common Stock shall expire and such tender
offer (as amended upon the expiration thereof) shall require the
payment to stockholders (based on the acceptance (up to any maximum
specified in the terms of the tender offer) of Purchased Shares (as
defined below)) of an aggregate consideration having a fair market
value (as determined by the authorized officer of Alcatel, whose
determination shall be conclusive) that combined together with (I) the
aggregate of the cash plus the fair market value (as determined by the
authorized officer of Alcatel, whose determination shall be
conclusive), as of the expiration of such tender offer, of
consideration payable in respect of any other tender offer by Alcatel
or any Subsidiary for all or any portion of the Common Stock expiring
within the 12 months preceding the expiration of such tender offer and
in respect of which no adjustment pursuant to this paragraph (6) has
been made and (II) the aggregate amount of any cash distributions to
all holders of Alcatel's Common Stock within 12 months preceding the
expiration of such tender offer and in respect of which no adjustment
pursuant to paragraph (5) of this Section has been made (the "combined
tender and cash amount") exceeds 12.5% of the product of the current
market price per Alcatel ADS (determined as provided in paragraph (8)
of this Section 12.4) as of the last time (the "Expiration Time")
tenders could have been made pursuant to such tender offer (as it may
be amended) times the number of Alcatel ADSs which would have to be
issued to reflect all shares of Common Stock outstanding (including any
tendered shares) as of the Expiration Time, then, and in each such
case, immediately prior to the opening of business on the day after the
date of the Expiration Time, the Conversion Price shall be adjusted so
that the same shall equal the price determined by dividing the
Conversion Price
83
100
immediately prior to close of business on the date of the Expiration
Time by a fraction (i) the numerator of which shall be equal to (A) the
product of (I) the current market price per Alcatel ADS (determined as
provided in paragraph (8) of this Section 12.4) on the date of the
Expiration Time multiplied by (II) the number of Alcatel ADSs which
would have to be issued to reflect all shares of Common Stock
outstanding (including any tendered shares) on the Expiration Time less
(B) the combined tender and cash amount, and (ii) the denominator of
which shall be equal to the product of (A) the current market price per
Alcatel ADS (determined as provided in paragraph (8) of this Section
12.4) as of the Expiration Time multiplied by (B) the number of Alcatel
ADSs which would have to be issued to reflect all shares of Common
Stock outstanding (including any tendered shares) as of the Expiration
Time less the number of Alcatel ADSs which would have to be issued to
represent all shares of Common Stock validly tendered and not withdrawn
as of the Expiration Time (the shares deemed so accepted up to any such
maximum, being referred to as the "Purchased Shares").
(7) The reclassification of Common Stock into securities other
than Common Stock (other than a reclassification upon a consolidation
or merger to which Section 12.11 applies) shall be deemed to involve
(a) a distribution of such securities other than Common Stock to all
holders of Common Stock (and the effective date of such
reclassification shall be deemed to be "the date fixed for the
determination of stockholders entitled to receive such distribution"
and "the date fixed for such determination" within the meaning of
paragraph (4) of this Section), and (b) a subdivision or combination,
as the case may be, of the number of shares of Common Stock outstanding
immediately prior to such reclassification into the number of shares of
Common Stock outstanding immediately thereafter (and the effective date
of such reclassification shall be deemed to be "the day upon which such
subdivision becomes effective" or "the day upon which such combination
becomes effective", as the case may be, and "the day upon which such
subdivision or combination becomes effective" within the meaning of
paragraph (3) of this Section 12.4).
(8) For the purpose of any computation under paragraphs (2),
(4), (5) or (6) of this Section 12.4, the current market price per
Alcatel ADS on any date shall be calculated by the Company and be
deemed to be the average of the daily Closing Prices Per Alcatel ADS
for the five consecutive Trading Days selected by the Company
commencing not more than 10 Trading Days before, and ending not later
than, the earlier of the day in question and the day before the "ex"
date with respect to the issuance or distribution requiring such
computation. For purposes of this paragraph, the term "'ex' date", when
used with respect to any issuance or distribution, means the first date
on which the Alcatel ADSs trade in a regular way in the applicable
securities market or on the applicable securities exchange without the
right to receive such issuance or distribution.
(9) No adjustment in the Conversion Price shall be required
unless such adjustment (plus any adjustments not previously made by
reason of this paragraph (9)) would require an increase or decrease of
at least one percent in such rate;
84
101
provided, however, that any adjustments which by reason of this
paragraph (9) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations under
this Article shall be made to the nearest cent or to the nearest
one-hundredth of an Alcatel ADS or share, as the case may be.
(10) The Company may make such reductions in the Conversion
Price, for the remaining term of the Securities or any shorter term, in
addition to those required by paragraphs (1), (2), (3), (4), (5) and
(6) of this Section 12.4, as it considers to be advisable in order to
avoid or diminish any income tax to any holders of Alcatel ADSs
resulting from any dividend or distribution of stock or issuance of
rights or warrants to purchase or subscribe for stock or from any event
treated as such for income tax purposes. The Company shall have the
power to resolve any ambiguity or correct any error in this paragraph
(10) and its actions in so doing shall, absent manifest error, be final
and conclusive.
SECTION 12.5. Notice of Adjustments of Conversion Price.
Whenever the Conversion Price is adjusted as herein provided:
(1) The Company shall compute the adjusted Conversion Price in
accordance with Section 12.4 and shall prepare a certificate signed by the Chief
Financial Officer of the Company setting forth the adjusted Conversion Price and
showing in reasonable detail the facts upon which such adjustment is based, and
such certificate shall promptly be filed with the Trustee and with each
Conversion Agent; and (2) upon each such adjustment, a notice stating that the
Conversion Price has been adjusted and setting forth the adjusted Conversion
Price shall be required, and as soon as practicable after it is required, such
notice shall be provided by the Company to all Holders in accordance with
Section 1.6. Neither the Trustee nor any Conversion Agent shall be under any
duty or responsibility with respect to any such certificate or the information
and calculations contained therein, except to exhibit the same to any Holder of
Securities desiring inspection thereof at its office during normal business
hours.
SECTION 12.6. Notice of Certain Corporate Action.
In case:
(a) Alcatel shall declare a dividend (or any other distribution) on its
Common Stock payable (i) otherwise than exclusively in cash or (ii) exclusively
in cash in an amount that would require any adjustment pursuant to Section 12.4;
or
(b) Alcatel shall authorize the granting to the holders of its Common
Stock of rights, options or warrants to subscribe for or purchase any shares of
capital stock of any class or of any other rights; or
(c) of any reclassification of the Common Stock of Alcatel, or of any
consolidation, merger or share exchange to which Alcatel is a party and for
which approval of any
85
102
stockholders of Alcatel is required, or of the conveyance, sale, transfer or
lease of all or substantially all of the assets of Alcatel; or
(d) of the voluntary or involuntary dissolution, liquidation or winding
up of Alcatel ;
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Securities pursuant to Section 10.2, and shall
cause to be provided to all Holders in accordance with Section 1.6, at least 20
days (or 10 days in any case specified in clause (a) or (b) above) prior to the
applicable record or effective date hereinafter specified, a notice stating (x)
the date on which a record is to be taken for the purpose of such dividend,
distribution, rights, options or warrants, or, if a record is not to be taken,
the date as of which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights, options or warrants are to be determined or
(y) the date on which such reclassification, consolidation, merger, conveyance,
transfer, sale, lease, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such reclassification,
consolidation, merger, conveyance, transfer, sale, lease, dissolution,
liquidation or winding up. Neither the failure to give such notice or the notice
referred to in the following paragraph nor any defect therein shall affect the
legality or validity of the proceedings described in clauses (a) through (d) of
this Section 12.6. If at the time the Trustee shall not be the conversion agent,
a copy of such notice shall also forthwith be filed by the Company with the
Trustee.
The Company shall cause to be filed at each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 10.2, and shall
cause to be provided to all Holders in accordance with Section 1.6, notice of
any tender offer by Alcatel or any Subsidiary for all or any portion of the
Common Stock at or about the time that such notice of tender offer is provided
to the public generally.
SECTION 12.7. Company to Reserve Common Stock.
[Deleted Intentionally]
SECTION 12.8. Taxes on Conversions.
Except as provided in the next sentence, the Company will pay any and
all taxes and duties that may be payable in respect of the delivery of Alcatel
ADSs on conversion of Securities pursuant hereto. The Company shall not,
however, be required to pay any tax or duty which may be payable in respect of
any transfer involved in the delivery of Alcatel ADSs in a name other than that
of the Holder of the Security or Securities to be converted, and no such
delivery shall be made unless and until the Person requesting such delivery has
paid to the Company the amount of any such tax or duty, or has established to
the satisfaction of the Company that such tax or duty has been paid.
SECTION 12.9. Covenant as to Alcatel ADSs
86
103
The Company agrees that all Alcatel ADSs which may be delivered upon
conversion of Securities will have been duly purchased on the open market and,
except as provided in Section 12.8, the Company will pay all taxes, liens and
charges with respect to the delivery thereof.
SECTION 12.10. Cancellation of Converted Securities.
All Securities delivered for conversion shall be delivered to the
Trustee or its agent to be canceled by or at the direction of the Trustee, which
shall dispose of the same as provided in Section 3.9.
SECTION 12.11. Provision in Case of Consolidation, Merger or Sale of Assets.
In case of any consolidation or merger of Alcatel with or into any
other Person, any merger of another Person with or into Alcatel (other than a
merger which does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock of Alcatel) or any
conveyance, sale, transfer or lease of all or substantially all of the assets of
Alcatel, the Person formed by such consolidation or resulting from such merger
or which acquires such assets, as the case may be, shall execute and deliver to
the Trustee a supplemental indenture providing that the Holder of each Security
then Outstanding shall have the right thereafter, during the period such
Security shall be convertible as specified in Section 12.1, to convert such
Security only into the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, conveyance, sale, transfer or lease
by a holder of the number of Alcatel ADSs into which such Security might have
been converted immediately prior to such consolidation, merger, conveyance,
sale, transfer or lease, assuming such holder of Alcatel ADSs (i) is not a
Person with which Alcatel consolidated or merged with or into or which merger
into or with Alcatel or to which such conveyance, sale, transfer or lease was
made, as the case may be ("Constituent Person"), or an Affiliate of a
Constituent Person and (ii) failed to exercise his rights of election, if any,
as to the kind or amount of securities, cash and other property receivable upon
such consolidation, merger, conveyance, sale, transfer or lease (provided that
if the kind or amount of securities, cash and other property receivable upon
such consolidation, merger, conveyance, sale, transfer or lease is not the same
for each Alcatel ADS held immediately prior to such consolidation, merger,
conveyance, sale, transfer or lease by others than a Constituent Person or an
Affiliate thereof and in respect of which such rights of election shall not have
been exercised ("Non-electing Alcatel ADSs"), then for the purpose of this
Section 12.11 the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, conveyance, sale, transfer or lease
by the holders of each Non-electing Alcatel ADS shall be deemed to be the kind
and amount so receivable per share by a plurality of the Non-electing Alcatel
ADSs), and further assuming, if such consolidation, merger, conveyance,
transfer, sale or lease occurs prior to the 90th day following the last original
issue date of the Securities, that the Security was convertible at the time of
such occurrence at the Conversion Rate specified in Section 12.1 as adjusted
from the issue date of such Security to such time as provided in this Article
Twelve. Such supplemental indenture shall provide for adjustments which, for
events subsequent to the effective date of such supplemental indenture, shall be
as nearly equivalent as may be practicable to the adjustments provided for in
this Article. The
87
104
above provisions of this Section 12.11 shall similarly apply to successive
consolidations, mergers, conveyances, sales, transfers or leases. Notice of the
execution of such a supplemental indenture shall be given by the Company to the
Holder of each Security as provided in Section 1.6 promptly upon such execution.
Neither the Trustee nor any Conversion Agent shall be under any
responsibility to determine the correctness of any provisions contained in any
such supplemental indenture relating either to the kind or amount of shares of
stock or other securities or property or cash receivable by Holders of
Securities upon the conversion of their Securities after any such consolidation,
merger, conveyance, transfer, sale or lease or to any such adjustment, but may
accept as conclusive evidence of the correctness of any such provisions, and
shall be protected in relying upon, an Opinion of Counsel with respect thereto,
which the Company shall cause to be furnished to the Trustee upon request.
SECTION 12.12. Responsibility of Trustee for Conversion Provisions.
The Trustee, subject to the provisions of Section 6.1, and any
Conversion Agent shall not at any time be under any duty or responsibility to
any Holder of Securities to determine whether any facts exist which may require
any adjustment of the Conversion Rate, or with respect to the nature or extent
of any such adjustment when made, or with respect to the method employed, or
herein or in any supplemental indenture provided to be employed, in making the
same, or whether a supplemental indenture need be entered into. Neither the
Trustee, subject to the provisions of Section 6.1, nor any Conversion Agent
shall be accountable with respect to the validity or value (or the kind or
amount) of any Alcatel ADSs, or of any other securities or property or cash,
which may at any time be delivered upon the conversion of any Security; and it
or they do not make any representation with respect thereto. Neither the
Trustee, subject to the provisions of Section 6.1, nor any Conversion Agent
shall be responsible for any failure of the Company to make or calculate any
cash payment or to issue, transfer or deliver any Alcatel ADSs or Alcatel ADS
certificates or other securities or property or cash upon the surrender of any
Security for the purpose of conversion; and the Trustee, subject to the
provisions of Section 6.1, and any Conversion Agent shall not be responsible for
any failure of the Company to comply with any of the covenants of the Company
contained in this Article.
ARTICLE THIRTEEN
SUBORDINATION OF SECURITIES
SECTION 13.1. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by his
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article (subject to the provisions of
Article Four), the indebtedness represented by the Securities and the payment of
the principal of (and premium, if any) and interest on,
88
105
and any payment of the Repurchase Price with respect to, each and all of the
Securities are hereby expressly made subordinate and subject in right of payment
to the prior payment in full of all Senior Indebtedness.
SECTION 13.2. Payment Over of Proceeds Upon Dissolution, Etc.
In the event of (a) any insolvency or bankruptcy case or proceeding, or
any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relative to the Company or to its creditors,
as such, or to its assets, or (b) any liquidation, dissolution or other winding
up of the Company, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (c) any assignment for the benefit of creditors or
any other marshaling of assets and liabilities of the Company, then and in any
such event the holders of Senior Indebtedness shall be entitled to receive
payment in full of all amounts due or to become due on or in respect of all
Senior Indebtedness in cash before the Holders of the Securities are entitled to
receive any payment on account of principal of (or premium, if any) or interest
(including any Liquidated Damages) on the Securities or on account of the
purchase, redemption or other acquisition of Securities, and to that end the
holders of Senior Indebtedness shall be entitled to receive, for application to
the payment thereof, any payment or distribution of any kind or character,
whether in cash, property or securities, which may be payable or deliverable in
respect of the Securities in any such case, proceeding, dissolution, liquidation
or other winding up or event.
In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the Company of any kind or character,
whether in cash, securities or other property, before all Senior Indebtedness is
paid in full, and if such fact shall, at or prior to the time of such payment or
distribution, have been made known to the Trustee or, as the case may be, such
Holder, then and in such event such payment or distribution shall be paid over
or delivered forthwith to the trustee in bankruptcy, receiver, liquidating
trustee, custodian, assignee, agent or other Person making payment or
distribution of assets of the Company for application to the payment of all
Senior Indebtedness remaining unpaid, to the extent necessary to pay all Senior
Indebtedness in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
For purposes of this Article only, the words "cash, securities or other
property" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, which shares of stock
or securities are subordinated in right of payment to all then outstanding
Senior Indebtedness to substantially the same extent as, or to a greater extent
than, the Securities are so subordinated as provided in this Article. The
consolidation of the Company with, or the merger of the Company into, another
Person or the liquidation or dissolution of the Company following the conveyance
or transfer of its properties and assets substantially as an entirety to another
Person upon the terms and conditions set forth in Article Seven shall not be
deemed a dissolution, winding up, liquidation, reorganization, assignment for
the benefit of creditors or marshaling of assets and liabilities of the Company
for the purposes of this Section if the Person formed by such consolidation or
into which the
89
106
Company is merged or which acquires by conveyance or transfer such properties
and assets substantially as an entirety, as the case may be, shall, as a part of
such consolidation, merger, conveyance or transfer, comply with the conditions
set forth in Article Seven.
SECTION 13.3. No Payment When Senior Indebtedness in Default.
(a) In the event and during the continuation of any default in the
payment of principal of (or premium, if any) or interest on (including a default
under any redemption or repurchase obligation with respect to) any Senior
Indebtedness beyond any applicable grace period with respect thereto or in the
event that any other event of default with respect to any Senior Indebtedness
shall have occurred and be continuing which would then permit the holders of
such Senior Indebtedness to declare such Senior Indebtedness due and payable
prior to the date on which it would otherwise have become due and payable,
unless and until such event of default shall have been cured or waived or shall
have ceased to exist after written notice to the Company and the Trustee by any
holder of such Senior Indebtedness, or any trustee, agent or representative
therefor or (b) in the event any judicial proceeding shall be pending with
respect to any such default in payment or event of default, then no payment
shall be made by the Company on account of principal of (or premium, if any) or
interest (including Liquidated Damages) on the Securities or on account of the
purchase, redemption or other acquisition of Securities.
In the event that, notwithstanding the foregoing, the Company shall
make any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company, in the case of the Trustee, or the Trustee,
in the case of such Holder.
The provisions of this Section shall not apply to any payment with
respect to which Section 13.2 would be applicable.
SECTION 13.4. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this Indenture or in
any of the Securities shall prevent (a) the Company, at any time except during
the pendency of any case, proceeding, dissolution, liquidation or other winding
up, assignment for the benefit of creditors or other marshaling of assets and
liabilities of the Company referred to in Section 13.2 or under the conditions
described in Section 13.3, from making payments at any time of principal of (and
premium, if any) or interest on the Securities, or (b) the application by the
Trustee of any money deposited with it hereunder to the payment of or on account
of the principal of (and premium, if any) or interest on the Securities or the
retention of such payment by the Holders, if, at the time of such application by
the Trustee, it did not have knowledge that such payment would have been
prohibited by the provisions of this Article.
SECTION 13.5. Subrogation to Rights of Holders of Senior Indebtedness.
90
107
Subject to the payment in full of all Senior Indebtedness, the Holders
of the Securities shall be subrogated to the extent of the payments or
distributions made to the holders of such Senior Indebtedness pursuant to the
provisions of this Article to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness until the principal of (and
premium, if any) and interest on the Securities shall be paid in full. For
purposes of such subrogation, no payments or distributions to the holders of the
Senior Indebtedness of any cash, property or securities to which the Holders of
the Securities or the Trustee would be entitled except for the provisions of
this Article, and no payments over pursuant to the provisions of this Article to
the holders of Senior Indebtedness by Holders of the Securities or the Trustee,
shall, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders of the Securities, be deemed to be a payment or
distribution by the Company to or on account of the Senior Indebtedness.
SECTION 13.6. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders of the Securities on the
one hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article or elsewhere in this Indenture or in the Securities is
intended to or shall (a) impair, as among the Company, its creditors other than
holders of Senior Indebtedness and the Holders of the Securities, the obligation
of the Company, which is absolute and unconditional, to pay to the Holders of
the Securities the principal of (and premium, if any) and interest on the
Securities as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against the Company of the
Holders of the Securities and creditors of the Company other than the holders of
Senior Indebtedness; or (c) prevent the Trustee or the Holder of any Security
from exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article of the
holders of Senior Indebtedness to receive cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder.
SECTION 13.7. Trustee to Effectuate Subordination.
Each holder of a Security by his acceptance thereof authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes.
SECTION 13.8. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder of any Senior
Indebtedness, or by any non-compliance by the Company with the terms, provisions
and covenants of this Indenture, regardless of any knowledge thereof any such
holder may have or be otherwise charged with.
91
108
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Senior Indebtedness, do any one or more of the following: (i) change the manner,
place or terms of payment or extend the time of payment of, or renew or alter,
Senior Indebtedness, or otherwise amend or supplement in any manner Senior
Indebtedness or any instrument evidencing the same or any agreement under which
Senior Indebtedness is outstanding; (ii) sell, exchange, release or otherwise
deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (iii) release any Person liable in any manner for the collection
of Senior Indebtedness; and (iv) exercise or refrain from exercising any rights
against the Company and any other Person.
SECTION 13.9. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by the
Trustee in respect of the Securities. Notwithstanding the provisions of this
Article or any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Company or a holder of Senior Indebtedness or from any trustee, agent or
representative therefor; and, prior to the receipt of any such written notice,
the Trustee, subject to the provisions of Section 6.1, shall be entitled in all
respects to assume that no such facts exist; provided, however, that if the
Trustee shall not have received the notice provided for in this Section 13.9
prior to the date upon which by the terms hereof any money may become payable
for any purpose (including, without limitation, the payment of the principal of
(and premium, if any) or interest on any Security), then, anything herein
contained to the contrary notwithstanding, the Trustee shall have full power and
authority to receive such money and to apply the same to the purpose for which
such money was received and shall not be affected by any notice to the contrary
which may be received by it within two Business Days prior to such date.
Subject to the provisions of Section 6.1, the Trustee shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself to be a holder of Senior Indebtedness (or a trustee, agent or
representative therefor) to establish that such notice has been given by a
holder of Senior Indebtedness (or a trustee, agent or representative therefor).
In the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article, the Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such Person, the extent to which such Person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such Person under this Article, and if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
92
109
SECTION 13.10. Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Company referred to
in this Article, the Trustee, subject to the provisions of Section 6.1, and the
Holders of the Securities shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such insolvency,
bankruptcy, receivership, liquidation, reorganization, dissolution, winding up
or similar case or proceeding is pending, or a certificate of the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee for the benefit
of creditors, agent or other Person making such payment or distribution,
delivered to the Trustee or to the Holders of Securities, for the purpose of
ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Indebtedness and other indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article.
SECTION 13.11. Trustee Not Fiduciary for Holders of Senior Indebtedness.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if it
shall in good faith mistakenly pay over or distribute to Holders of Securities
or to the Company or to any other Person cash, property or securities to which
any holders of Senior Indebtedness shall be entitled by virtue of this Article
or otherwise.
SECTION 13.12. Reliance by Holders of Senior Indebtedness on Subordination
Provisions.
Each Holder by accepting a Security acknowledges and agrees that the
foregoing subordination provisions are, and are intended to be, an inducement
and a consideration to each holder of any Senior Indebtedness, whether such
Senior Indebtedness was created or acquired before or after the issuance of the
Securities, to acquire and continue to hold, or to continue to hold, such Senior
Indebtedness and such holder of Senior Indebtedness shall be deemed conclusively
to have relied on such subordination provisions in acquiring and continuing to
hold, or in continuing to hold, such Senior Indebtedness.
SECTION 13.13. Rights of Trustee as Holder of Senior Indebtedness; Preservation
of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article with respect to any Senior Indebtedness which
may at any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 6.7.
SECTION 13.14. Article Applicable to Paying Agents.
93
110
In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company and be then acting hereunder, the term "Trustee"
as used in this Article shall in such case (unless the context otherwise
requires) be construed as extending to and including such Paying Agent within
its meaning as fully for all intents and purposes as if such Paying Agent were
named in this Article in addition to or in place of the Trustee; provided,
however, that Section 13.13 shall not apply to the Company or any Affiliate of
the Company if it or such Affiliate acts as Paying Agent.
SECTION 13.15. Certain Conversions and Repurchases Deemed Payment.
For the purposes of this Article only, (1) the issuance and delivery of
junior securities upon conversion of Securities in accordance with Article
Twelve or upon the repurchase of Securities in accordance with Article Fourteen
shall not be deemed to constitute a payment or distribution on account of the
principal of or premium or interest on Securities or on account of the purchase
or other acquisition of Securities, and (2) the payment, issuance or delivery of
cash, property or securities (other than junior securities) upon conversion of a
Security shall be deemed to constitute payment on account of the principal of
such Security. For the purposes of this Section, the term "junior securities"
means (a) Alcatel ADSs and any cash, property or securities into which the
Securities are convertible pursuant to Article Twelve and (b) securities of the
Company which are subordinated in right of payment to all Senior Indebtedness
which may be outstanding at the time of issuance or delivery of such securities
to substantially the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article. Nothing contained in this
Article or elsewhere in this Indenture or in the Securities is intended to or
shall impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders of the Securities, the right, which is absolute and
unconditional, of the Holder of any Security to convert such Security in
accordance with Article Twelve or to exchange such Security for Alcatel ADSs in
accordance with Article Fourteen if the Company elects to satisfy the
obligations under Article Fourteen by the delivery of Alcatel ADSs.
ARTICLE FOURTEEN
REPURCHASE OF SECURITIES AT THE OPTION OF THE
HOLDER UPON A CHANGE IN CONTROL
SECTION 14.1. Right to Require Repurchase.
In the event that a Change in Control (as hereinafter defined) shall
occur, then each Holder shall have the right, at the Holder's option, but
subject to the provisions of Section 14.2, to require the Company to repurchase,
and upon the exercise of such right the Company shall repurchase, all of such
Holder's Securities not theretofore called for redemption, or any portion of the
principal amount thereof that is equal to U.S.$5,000 or any integral multiple of
U.S.$1,000 in excess thereof (provided that no single Security may be
repurchased in part unless the portion of the principal amount of such Security
to be Outstanding after such repurchase is equal to U.S.$5,000 or integral
multiples of U.S.$1,000 in excess thereof), on the date (the "Repurchase Date")
that is 45 days after the date of the Company Notice (as
94
111
defined in Section 14.3) at a purchase price equal to 100% of the principal
amount of the Securities to be repurchased plus interest accrued to the
Repurchase Date (the "Repurchase Price"); provided, however, that installments
of interest on Securities whose Stated Maturity is on or prior to the Repurchase
Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such on the relevant Record Date according
to their terms and the provisions of Section 3.7. Such right to require the
repurchase of the Securities shall not continue after a discharge of the Company
from its obligations with respect to the Securities in accordance with Article
Four, unless a Change in Control shall have occurred prior to such discharge. At
the option of the Company, the Repurchase Price may be paid in cash or, subject
to the fulfillment by the Company of the conditions set forth in Section 14.2,
by delivery of Alcatel ADSs having a fair market value equal to the Repurchase
Price. Whenever in this Indenture (including Sections 2.2, 3.1, 5.1(1) and 5.8)
there is a reference, in any context, to the principal of any Security as of any
time, such reference shall be deemed to include reference to the Repurchase
Price payable in respect of such Security to the extent that such Repurchase
Price is, was or would be so payable at such time, and express mention of the
Repurchase Price in any provision of this Indenture shall not be construed as
excluding the Repurchase Price in those provisions of this Indenture when such
express mention is not made; provided, however, that for the purposes of Article
Thirteen such reference shall be deemed to include reference to the Repurchase
Price only to the extent the Repurchase Price is payable in cash.
SECTION 14.2. Conditions to the Company's Election to Pay the Repurchase Price
in Alcatel ADSs.
The Company may elect to pay the Repurchase Price by delivery of
Alcatel ADSs pursuant to Section 14.1 if and only if the following conditions
shall have been satisfied:
(a) The Alcatel ADSs deliverable in payment of the Repurchase Price
shall have a fair market value as of the Repurchase Date of not less than the
Repurchase Price. For purposes of Section 14.1 and this Section 14.2, the fair
market value of Alcatel ADSs shall be determined by the Company and shall be
equal to 95% of the average of the Closing Prices Per Alcatel ADS for the five
consecutive Trading Days immediately preceding the second Trading Day prior to
the Repurchase Date;
(b) The Repurchase Price shall be paid only in cash in the event
Alcatel ADS to be delivered upon repurchase of Securities hereunder (i) require
registration under any federal securities law before such shares may be freely
transferrable without being subject to any transfer restrictions under the
Securities Act upon repurchase and if such registration is not completed or does
not become effective prior to the Repurchase Date, and/or (ii) require
registration with or approval of any governmental authority under any state law
or any other federal law before such Alcatel ADSs may be validly delivered upon
repurchase and if such registration is not completed or does not become
effective or such approval is not obtained prior to the Repurchase Date;
95
112
(c) Payment of the Repurchase Price may not be made in Alcatel ADSs
unless such Alcatel ADSs are, or shall have been, approved for quotation on the
Nasdaq National Market or listed on a national securities exchange, in either
case, prior to the Repurchase Date; and
(d) All Alcatel ADSs which may be delivered upon repurchase of
Securities will be purchased by the Company on the open market.
If all of the conditions set forth in this Section 14.2 are not
satisfied in accordance with the terms thereof, the Repurchase Price shall be
paid by the Company only in cash.
SECTION 14.3. Notices; Method of Exercising Repurchase Right, Etc.
(a) Unless the Company shall have theretofore called for redemption all
of the Outstanding Securities, on or before the 30th day after the occurrence of
a Change in Control, the Company or, at the request and expense of the Company
on or before the 15th day after such occurrence, the Trustee, shall give to all
Holders of Securities, in the manner provided in Section 1.6, notice (the
"Company Notice") of the occurrence of the Change of Control and of the
repurchase right set forth herein arising as a result thereof. The Company shall
also deliver a copy of such notice of a repurchase right to the Trustee.
Each notice of a repurchase right shall state:
(1) the Repurchase Date,
(2) the date by which the repurchase right must be exercised,
(3) the Repurchase Price, and whether the Repurchase Price shall be
paid by the Company in cash or by delivery of Alcatel ADSs,
(4) a description of the procedure which a Holder must follow to
exercise a repurchase right, and the place or places where such Securities, are
to be surrendered for payment of the Repurchase Price and accrued interest, if
any,
(5) that on the Repurchase Date the Repurchase Price, and accrued
interest, if any, will become due and payable upon each such Security designated
by the Holder to be repurchased, and that interest thereon shall cease to accrue
on and after said date,
(6) the Conversion Rate then in effect, the date on which the right to
convert the principal amount of the Securities to be repurchased will terminate
and the place or places where such Securities may be surrendered for conversion,
and
(7) the place or places that the certificate required by Section 2.2
shall be delivered, and the form of such certificate and the place or places
that the Surrender Certificate required by Section 14.3(i) shall be delivered.
96
113
In addition, at least two Business Days preceding the Repurchase Date,
the Company shall give to all Holders of the Securities, in the manner provided
in Section 1.6, notice specifying whether the Repurchase Price will be payable
in cash or Alcatel ADSs and shall deliver a copy of such notice to the Trustee.
No failure of the Company to give the foregoing notices or defect
therein shall limit any Holder's right to exercise a repurchase right or affect
the validity of the proceedings for the repurchase of Securities.
If any of the foregoing provisions or other provisions of this Article
Fourteen are inconsistent with applicable law, such law shall govern.
(b) To exercise a repurchase right, a Holder shall deliver to the
Trustee on or before the 30th day after the date of the Company Notice (i)
written notice of the Holder's exercise of such right, which notice shall set
forth the name of the Holder, the principal amount of the Securities to be
repurchased (and, if any Security is to repurchased in part, the serial number
thereof, the portion of the principal amount thereof to be repurchased and the
name of the Person in which the portion thereof to remain Outstanding after such
repurchase is to be registered) and a statement that an election to exercise the
repurchase right is being made thereby, and, in the event that the Repurchase
Price shall be paid in Alcatel ADSs, the name or names (with addresses) in which
the certificate or certificates for Alcatel ADSs shall be issued, and (ii) the
Securities with respect to which the repurchase right is being exercised. Such
written notice shall be irrevocable, except that the right of the Holder to
convert the Securities with respect to which the repurchase right is being
exercised shall continue until the close of business on the Repurchase Date.
(c) In the event a repurchase right shall be exercised in accordance
with the terms hereof, the Company shall pay or cause to be paid to the Trustee
the Repurchase Price in cash or Alcatel ADSs, as provided above, for payment to
the Holder on the Repurchase Date or, if Alcatel ADSs are to be paid, as
promptly after the Repurchase Date as practicable, together with accrued and
unpaid interest to the Repurchase Date payable with respect to the Securities as
to which the purchase right has been exercised; provided, however, that
installments of interest that mature on or prior to the Repurchase Date shall be
payable in cash to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant Regular
Record Date.
(d) If any Security (or portion thereof) surrendered for repurchase
shall not be so paid on the Repurchase Date, the principal amount of such
Security (or portion thereof, as the case may be) shall, until paid, bear
interest to the extent permitted by applicable law from the Repurchase Date at
the rate of 7% per annum, and each Security shall remain convertible into
Alcatel ADSs until the principal of such Security (or portion thereof, as the
case may be) shall have been paid or duly provided for.
(e) Any Security which is to be repurchased only in part shall be
surrendered to the Trustee (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by,
97
114
the Holder thereof or his attorney duly authorized in writing), and the Company
shall execute, and the Trustee shall authenticate and make available for
delivery to the Holder of such Security without service charge, a new Security
or Securities, containing identical terms and conditions, each in an authorized
denomination in aggregate principal amount equal to and in exchange for the
unrepurchased portion of the principal of the Security so surrendered.
(f) Any delivery of Alcatel ADSs in respect of the Repurchase Price
shall be deemed to have been effected immediately prior to the close of business
on the Repurchase Date and the Person or Persons in whose name or names any
certificate or certificates for Alcatel ADSs shall be issuable upon such
repurchase shall be deemed to have become on the Repurchase Date the holder or
holders of record of the Alcatel ADSs represented thereby; provided, however,
that any surrender for repurchase on a date when the stock transfer books of the
Company shall be closed shall constitute the Person or Persons in whose name or
names the certificate or certificates for such Alcatel ADSs are to be issued as
the record holder or holders thereof for all purposes at the opening of business
on the next succeeding day on which such stock transfer books are open. No
payment or adjustment shall be made for dividends or distributions on any
Alcatel ADSs delivered upon repurchase of any Security declared prior to the
Repurchase Date.
(g) No fractions of Alcatel ADSs shall be delivered upon repurchase of
Securities. If more than one Security shall be repurchased from the same Holder
and the Repurchase Price shall be payable in Alcatel ADSs, the number of full
Alcatel ADSs which shall be deliverable upon such repurchase shall be computed
on the basis of the aggregate principal amount of the Securities so repurchased.
Instead of any fractional Alcatel ADSs which would otherwise be deliverable on
the repurchase of any Security or Securities, the Company will deliver to the
applicable Holder its check for the current market value of such fractional
Alcatel ADSs . The current market value of a fraction of an Alcatel ADS is
determined by multiplying the current market price of a full Alcatel ADS by the
fraction, and rounding the result to the nearest cent. For purposes of this
Section, the current market price of an Alcatel ADS is the Closing Price Per
Alcatel ADS on the Trading Day immediately preceding the Repurchase Date.
(h) Any issuance and delivery of certificates for Alcatel ADSs on
repurchase of Securities shall be made without charge to the Holder of
Securities being repurchased for such certificates or for any tax or duty in
respect of the issuance or delivery of such certificates or the securities
represented thereby; provided, however, that the Company shall not be required
to pay any tax or duty which may be payable in respect of (i) income of the
Holder or (ii) any transfer involved in the issuance or delivery of certificates
for Alcatel ADSs in a name other than that of the Holder of the Securities being
repurchased, and no such issuance or delivery shall be made unless and until the
Person requesting such issuance or delivery has paid to the Company the amount
of any such tax or duty or has established, to the satisfaction of the Company,
that such tax or duty has been paid.
(i) If Alcatel ADSs to be delivered upon repurchase of a Security are
to be registered in a name other than that of the beneficial owner of such
Security, then such Holder must deliver to the Trustee a Surrender Certificate,
dated the date of surrender of such Restricted Security and signed by such
beneficial owner, as to compliance with the restrictions on
98
115
transfer applicable to such Restricted Security. Neither the Trustee nor any
Registrar or Transfer Agent or other agents shall be required to register in a
name other than that of the beneficial owner of Alcatel ADSs delivered upon
repurchase of any such Restricted Security not so accompanied by a properly
completed Surrender Certificate.
(j) All Securities delivered for repurchase shall be delivered to the
Trustee to be canceled at the direction of the Trustee, which shall dispose of
the same as provided in Section 3.9.
SECTION 14.4. Certain Definitions.
For purposes of this Article Fourteen,
(a) the term "beneficial owner" shall be determined in accordance with
Rule 13d-3, as in effect on the date of the original execution of this
Indenture, promulgated by the Commission pursuant to the Exchange Act;
(b) a "Change in Control" shall be deemed to have occurred at the time,
after the original issuance of the Securities, of:
(i) the acquisition by any person of beneficial ownership, directly or
indirectly, through a purchase, merger or other acquisition transaction or
series of transactions, of shares of capital stock of the Company entitling such
person to exercise 50% or more of the total voting power of all shares of
capital stock of the Company entitled to vote generally in the elections of
directors (any shares of voting stock of which such person or group is the
beneficial owner that are not then outstanding being deemed outstanding for
purposes of calculating such percentage), other than any such acquisition by the
Company or Alcatel, any Subsidiary of the Company or Alcatel or any employee
benefit plan of the Company or Alcatel existing on the date of this Indenture;
or
(ii) any consolidation or merger of the Company with or into, any other
person, any merger of another person with or into the Company, or any
conveyance, sale, transfer or lease of all or substantially all of the assets of
the Company to another person (other than (a) any such transaction (x) which
does not result in any reclassification, conversion, exchange or cancellation of
outstanding shares of Common stock of the Company or (y) pursuant to which
holders of Common stock of the Company immediately prior to such transaction
have the entitlement to exercise, directly or indirectly, 50% or more of the
total voting power of all shares of capital stock entitled to vote generally in
the election of directors of the continuing or surviving person immediately
after such transaction and (b) any merger which is effected solely to change the
jurisdiction of incorporation of the Company and results in a reclassification,
conversion or exchange of outstanding shares of Common stock of the Company into
solely shares of Common stock);
Provided, however, that a Change in Control shall not be deemed to have
occurred if either (x) the Closing Price Per Alcatel ADS on any five Trading
Days within the period of 10 consecutive Trading Days ending immediately after
the later of the date of the Change in
99
116
Control or the date of the public announcement of the Change in Control (in the
case of a Change in Control under Clause (i) above) or the period of 10
consecutive Trading Days ending immediately prior to the date of the Change in
Control (in the case of a Change in Control under Clause (ii) above) shall equal
or exceed 105% of the Conversion Price of the Securities in effect on each such
Trading Day or (y) in the event that the Change of Control is effected through
the acquisition of the Common Stock of Alcatel, all the consideration (excluding
cash payments for fractional shares) to be paid for the Common Stock in the
transaction or transactions constituting the change in Control consists of
shares of common stock traded on a national securities exchange or quoted on the
Nasdaq National Market and as a result of such transaction or transactions the
Securities become convertible solely into such common stock; and
(c) for purposes of Section 14.4(b)(i), the term "person" shall include
any syndicate or group which would be deemed to be a "person" under Section
13(d)(3) of the Exchange Act, as in effect on the date of the original execution
of this Indenture.
ARTICLE FIFTEEN
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY;
NON-RECOURSE
SECTION 15.1. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not more than 15 days after the Regular Record Date,
a list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders of Securities as of such Regular Record Date, and
(b) at such other times as the Trustee may reasonably request in
writing, within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days prior to the
time such list is furnished; excluding from any such list names and addresses
received by the Trustee in its capacity as Security Registrar.
SECTION 15.2. Preservation of Information.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 15.1 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 15.1 upon receipt of a new list so furnished.
(b) After this Indenture has been qualified under the Trust Indenture
Act, the rights of Holders to communicate with other Holders with respect to
their rights under this Indenture
100
117
or under the Securities, and the corresponding rights and duties of the Trustee,
shall be as provided by the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made pursuant to
the Trust Indenture Act.
SECTION 15.3. No Recourse Against Others.
An incorporator or any past, present or future director, officer,
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Securities or this Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Holder shall waive and release all such
liability. Such waiver and release shall be part of the consideration for the
issue of the Securities.
SECTION 15.4. Reports by Trustee.
(a) After this Indenture has been qualified under the Trust Indenture
Act, the Trustee shall transmit to Holders such reports concerning the Trustee
and its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto.
(b) After this Indenture has been qualified under the Trust Indenture
Act, a copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when the Securities are listed on any stock exchange.
SECTION 15.5. Reports by Company.
After this Indenture has been qualified under the Trust Indenture Act,
the Company shall file with the Trustee and the Commission, and transmit to
Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times and
in the manner provided pursuant to such Act; provided that any such information,
documents or reports required to be filed with the Commission pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 shall be filed with
the Trustee within 15 days after the same is so required to be filed with the
Commission.
ARTICLE 16
THE GUARANTY
SECTION 16.1. Guaranty.
101
118
Alcatel has, pursuant to the Guaranty dated as of September 17, 1998, a
copy of which is attached hereto as Exhibit I, fully and unconditionally
guaranteed the due and punctual payment of the principal of, premium, if any,
and interest (including Liquidated Damages) on the Securities. In case of a
failure of the Company to pay or cause to be paid punctually any such amounts in
accordance with the terms of this Indenture, Alcatel hereby agrees, upon written
notice from the Trustee, to pay or cause to be paid punctually any such amounts
when and as the same become due and payable in accordance with the Guaranty.
---------------------
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
102
119
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, as of the day and year first above written.
Alcatel USA, Inc.
THE BANK OF NEW YORK, Trustee
As Guarantor, ALCATEL
103
120
ANNEX A -- Form of Regulation S Certificate
REGULATION S CERTIFICATE
(For transfers pursuant to ss. 3.5(b)(i), (iii) and (v) of the Indenture)
The Bank of New York
as Trustee
000 Xxxxxxx Xx., Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Re: 7% Convertible Subordinated Notes due August 1, 2004 of Alcatel USA, Inc.
(the "Securities")
Reference is made to the Indenture, dated as of August 12, 1997 (the
"Initial Indenture"), as supplemented by the First Supplemental Indenture dated
as of September 4, 1998, between the Company and The Bank of New York (the
"First Supplemental Indenture") and the Second Supplemental Indenture dated as
of April 1, 1999, between the Company, Alcatel and The Bank of New York, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture) (the "Second Supplemental Indenture", together with the
Initial Indenture and the First Supplemental Indenture, the "Indenture"). Terms
used herein and defined in the Indenture or in Regulation S or Rule 144 under
the U.S. Securities Act of 1933 (the "Securities Act") are used herein as so
defined.
This certificate relates to U.S. $____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s). ___________________________
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Security, they are held
through the Depositary or an Agent Member in the name of the Undersigned, as or
on behalf of the Owner. If the Specified Securities are not represented by a
Global Security, they are registered in the name of the Undersigned, as or on
behalf of the Owner.
The Owner has requested that the Specified Securities be transferred to
a person (the "Transferee") who will take delivery in the form of a Regulation S
Security. In connection with such transfer, the Owner hereby certifies that,
unless such transfer is being effected pursuant to an effective registration
statement under the Securities Act, it is being effected in accordance with Rule
904 or Rule 144 under the Securities Act and with all applicable
A-1
121
securities laws of the states of the United States and other jurisdictions.
Accordingly, the Owner hereby further certifies as follows:
(1) Rule 904 Transfers. If the transfer is being effected in accordance
with Rule 904:
(A) the Owner is not a distributor of the Securities, an affiliate of
the Company or any such distributor or a person acting on behalf of any of the
foregoing;
(B) the offer of the Specified Securities was not made to a person in
the United States;
(C) either:
(i) at the time the buy order was originated, the Transferee was
outside the United States or the Owner and any person acting on its behalf
reasonably believed that the Transferee was outside the United States, or
(ii) the transaction is being executed in, on or through the facilities
of the Eurobond market, as regulated by the Association of International Bond
Dealers, or another designated offshore securities market and neither the Owner
nor any person acting on its behalf knows that the transaction has been
prearranged with a buyer in the United States;
(D) no directed selling efforts have been made in the United States by
or on behalf of the Owner or any affiliate thereof;
(E) if the Owner is a dealer in securities or has received a selling
concession, fee or other remuneration in respect of the Specified Securities,
and the transfer is to occur during the Restricted Period, then the requirements
of Rule 904(c)(1) have been satisfied; and
(F) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
(2) Rule 144 Transfers. If the transfer is being effected pursuant to
Rule 144:
(A) the transfer is occurring after a holding period of at least two
years (computed in accordance with paragraph (d) of Rule 144) has elapsed since
the date the Specified Securities were acquired from the Company or from an
affiliate (as such term is defined in Rule 144) of the Company, whichever is
later, and is being effected in accordance with the applicable amount, manner of
sale and notice requirements of paragraphs (e), (f) and (h) of Rule 144; or
(B) the transfer is occurring after a period of at least three years
has elapsed since the date the Specified Securities were acquired from the
Company or from an affiliate (as such term is defined in Rule 144) of the
Company, whichever is later, and the Owner is not, and during the preceding
three months has not been, an affiliate of the Company.
A-2
122
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Initial Purchaser.
Dated:
_________________________________________________
(Print the name of the Undersigned, as such term is defined in the second
paragraph of this certificate.)
By:
_________________________________________________
Name:
Title:
(If the Undersigned is a corporation, partnership or fiduciary, the title of the
person signing on behalf of the Undersigned must be stated.)
_________________________________________________
Signature Guaranteed
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the [Registrar], which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the [Registrar] in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-3
123
ANNEX B -- Form of Restricted Securities Certificate
RESTRICTED SECURITIES CERTIFICATE
(For transfers pursuant to ss. 3.5(b)(ii), (iii), (iv) and (v)
of the Indenture)
The Bank of New York
as Trustee
000 Xxxxxxx Xx., Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Re: 7% Convertible Subordinated Notes due August 1, 2004 of Alcatel USA, Inc.
(the "Securities")
Reference is made to the Indenture, dated as of August 12, 1997 (the
"Initial Indenture"), as supplemented by the First Supplemental Indenture dated
as of September 4, 1998, between the Company and The Bank of New York (the
"First Supplemental Indenture") and the Second Supplemental Indenture dated as
of April 1, 1999, between the Company, Alcatel and The Bank of New York, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture) (the "Second Supplemental Indenture", together with the
Initial Indenture and the First Supplemental Indenture, the "Indenture"). Terms
used herein and defined in the Indenture or in Regulation S or Rule 144 under
the U.S. Securities Act of 1933 (the "Securities Act") are used herein as so
defined.
This certificate relates to U.S. $_____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s). ___________________________
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so.
B-1
124
Such beneficial owner or owners are referred to herein collectively as
the "Owner". If the Specified Securities are represented by a Global Security,
they are held through the Depositary or an Agent Member in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Security, they are registered in the name of the
Undersigned, as or on behalf of the Owner.
The Owner has requested that the Specified Securities be transferred to
a person (the "Transferee") who will take delivery in the form of a Restricted
Security. In connection with such transfer, the Owner hereby certifies that,
unless such transfer is being effected pursuant
to an effective registration statement under the Securities Act, it is being
effected in accordance with Rule 144A or Rule 144 under the Securities Act and
all applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as:
(1) Rule 144A Transfers. If the transfer is being effected in
accordance with Rule 144A:
(A) the Specified Securities are being transferred to a person that the
Owner and any person acting on its behalf reasonably believe is a "qualified
institutional buyer" within the meaning of Rule 144A, acquiring for its own
account or for the account of a qualified institutional buyer; and
(B) the Owner and any person acting on its behalf have taken reasonable
steps to ensure that the Transferee is aware that the Owner may be relying on
Rule 144A in connection with the transfer; and (2) Rule 144 Transfers. If the
transfer is being effected pursuant to Rule 144:
(A) the transfer is occurring after a holding period of at least two
years (computed in accordance with paragraph (d) of Rule 144) has elapsed since
the date the Specified Securities were acquired from the Company or from an
affiliate (as such term is defined in Rule 144) of the Company, whichever is
later, and is being effected in accordance with the applicable amount, manner of
sale and notice requirements of paragraphs (e), (f) and (h) of Rule 144; or
(B) the transfer is occurring after a period of at least two years has
elapsed since the date the Specified Securities were acquired from the Company
or from an affiliate (as such term is defined in Rule 144) of the Company,
whichever is later, and the Owner is not, and during the preceding three months
has not been, an affiliate of the Company.
B-2
125
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Initial Purchaser.
Dated:
_________________________________________________
(Print the name of the Undersigned, as such term
is defined in the second paragraph of this
certificate.)
By: _____________________________________________
Name:
Title:
(If the Undersigned is a corporation, partnership
or fiduciary, the title of the person signing on
behalf of the Undersigned must be stated.)
_________________________________________________
Signature Guaranteed
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the [Registrar], which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the [Registrar] in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
B-3
126
ANNEX C -- Form of Unrestricted Securities Certificate
UNRESTRICTED SECURITIES CERTIFICATE
For removal of Securities Act Legends pursuant to ss. 3.5(c))
The Bank of New York
as Trustee
000 Xxxxxxx Xx., Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Re: 7% Convertible Subordinated Notes due August 1, 2004 of Alcatel USA, Inc.
(the "Securities")
Reference is made to the Indenture, dated as of August 12, 1997 (the
"Initial Indenture"), as supplemented by the First Supplemental Indenture dated
as of September 4, 1998, between the Company and The Bank of New York (the
"First Supplemental Indenture") and the Second Supplemental Indenture dated as
of April 1, 1999, between the Company, Alcatel and The Bank of New York, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture) (the "Second Supplemental Indenture", together with the
Initial Indenture and the First Supplemental Indenture, the "Indenture"). Terms
used herein and defined in the Indenture or in Regulation S or Rule 144 under
the U.S. Securities Act of 1933 (the "Securities Act") are used herein as so
defined.
This certificate relates to U.S. $_____________ principal amount of
Securities, which are evidenced by the following certificate(s) (the "Specified
Securities"):
CUSIP No(s). ___________________________
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the
"Undersigned") hereby certifies that either (i) it is the sole beneficial owner
of the Specified Securities or (ii) it is acting on behalf of all the beneficial
owners of the Specified Securities and is duly authorized by them to do so.
Such beneficial owner or owners are referred to herein collectively as
the "Owner". If the Specified Securities are represented by a Global Security,
they are held through the Depositary or an Agent Member in the name of the
Undersigned, as or on behalf of the Owner. If the Specified Securities are not
represented by a Global Security, they are registered in the name of the
Undersigned, as or on behalf of the Owner.
C-1
127
The Owner has requested that the Specified Securities be exchanged for
Securities bearing no Securities Act Legend pursuant to Section 3.5(c) of the
Indenture. In connection with such exchange, the Owner hereby certifies that the
exchange is occurring after a period of at least two years has elapsed since the
date the Specified Securities were acquired from the Company or from an
affiliate (as such term is defined in Rule 144) of the Company, whichever is
later, and the Owner is not, and during the preceding three months has not been,
an affiliate of the Company. The Owner also acknowledges that any future
transfers of the Specified Securities must comply with all applicable securities
laws of the states of the United States and other jurisdictions.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company and the Initial Purchaser.
Dated:
_________________________________________________
(Print the name of the Undersigned, as such term is defined in the second
paragraph of this certificate.)
By: _____________________________________________
Name:
Title:
(If the Undersigned is a corporation, partnership or fiduciary, the title of
the person signing on behalf of the Undersigned must be stated.)
_________________________________________________
Signature Guaranteed
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the [Registrar], which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the [Registrar] in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
C-2
128
ANNEX D - Form of Surrender Certificate
In connection with the certification contemplated by Section 12.2 or
14.3(i) relating to compliance with certain restrictions relating to transfers
of Restricted Securities, such certification shall be provided substantially in
the form of the following certificate, with only such changes thereto as shall
be approved by the Company and Xxxxxxx, Sachs & Co.:
CERTIFICATE
ALCATEL USA, INC.
7% CONVERTIBLE SUBORDINATED NOTES DUE AUGUST 1, 2004
This is to certify that as of the date hereof with respect to
U.S.$________ principal amount (as defined in the Indenture) of the
above-captioned securities surrendered on the date hereof (the "Surrendered
Securities") for registration of transfer, or for conversion or repurchase where
the securities issuable upon such conversion or repurchase are to be registered
in a name other than that of the undersigned Holder (each such transaction being
a "transfer"), the undersigned Holder (as defined in the Indenture) certifies
that the transfer of Surrendered Securities associated with such transfer
complies with the restrictive legend set forth on the face of the Surrendered
Securities for the reason checked below:
________ The transfer of the Surrendered Securities complies with Rule
144 under the United States Securities Act of 1933, as amended (the
"Securities Act"); or
________ The transfer of the Surrendered Securities complies with Rule
144A under the Securities Act; or
________ The transfer of the Surrendered Securities complies with Rule
904 under the Securities Act.
________ The transfer of the Surrendered Securities has been made to an
institution that is an "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act in a transaction
exempt from the registration requirements of the Securities Act.
[Name of Holder]
_________________________________________________
Dated: ____________, ____
To be dated the date
of surrender
D-1