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COMVERSE TECHNOLOGY, INC.,
ISSUER
TO
THE CHASE MANHATTAN BANK,
TRUSTEE
INDENTURE
Dated as of October 4, 1996
U.S. $100,000,000
5-3/4% CONVERTIBLE SUBORDINATED DEBENTURES DUE 2006
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TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1 Definitions.................................... 1
SECTION 1.2 Form of Documents Delivered to
Trustee...................................... 11
SECTION 1.3 Acts of Holders of Securities.................. 12
SECTION 1.4 Notices, Etc., to Trustee and Company.......... 13
SECTION 1.5 Notice to Holders of Securities;
Waiver....................................... 14
SECTION 1.6 Effect of Headings and Table of
Contents..................................... 14
SECTION 1.7 Successors and Assigns......................... 15
SECTION 1.8 Separability Clause............................ 15
SECTION 1.9 Benefits of Indenture.......................... 15
SECTION 1.10 GOVERNING LAW................................. 15
SECTION 1.11 Counterparts.................................. 15
SECTION 1.12 Legal Holidays................................ 15
SECTION 1.13 Recourse Against Others....................... 16
ARTICLE 2
THE SECURITIES
SECTION 2.1 Title and Terms................................ 16
SECTION 2.2 Form of Securities............................. 17
SECTION 2.3 Denominations.................................. 18
SECTION 2.4 Execution, Authentication, Delivery
and Dating................................... 18
SECTION 2.5 Registration, Registration of
Transfer and Exchange;
Restrictions on Transfer..................... 19
SECTION 2.6 Mutilated, Destroyed, Lost or Stolen
Securities................................... 32
SECTION 2.7 Payment of Interest, Interest Rights
Preserved.................................... 33
SECTION 2.8 Persons Deemed Owners.......................... 34
SECTION 2.9 Cancellation................................... 35
SECTION 2.10 Computation of Interest....................... 35
SECTION 2.11 Temporary Securities.......................... 35
ARTICLE 3
SATISFACTION AND DISCHARGE
SECTION 3.1 Satisfaction and Discharge of
Indenture.................................... 36
SECTION 3.2 Application of Trust Money..................... 37
ARTICLE 4
REMEDIES
SECTION 4.1 Events of Default.............................. 38
SECTION 4.2 Acceleration of Maturity; Rescission
and Annulment................................ 39
SECTION 4.3 Collection of Indebtedness and Suits
for Enforcement by the
Trustee...................................... 41
SECTION 4.4 Trustee May File Proofs of Claim............... 41
SECTION 4.5 Trustee May Enforce Claims Without
Possession of Securities..................... 42
SECTION 4.6 Application of Money Collected................. 42
SECTION 4.7 Limitation on Suit............................. 43
SECTION 4.8 Unconditional Right of Holders to
Receive Principal, Premium
and Interest and To Convert.................. 44
SECTION 4.9 Restoration of Rights and Remedies............. 44
SECTION 4.10 Rights and Remedies Cumulative................ 44
SECTION 4.11 Delay or Omission Not Waiver.................. 44
SECTION 4.12 Control by Holders of Securities.............. 45
SECTION 4.13 Waiver of Past Default........................ 45
SECTION 4.14 Undertaking for Costs......................... 45
SECTION 4.15 Waiver of Stay or Extension Laws.............. 46
ARTICLE 5
THE TRUSTEE
SECTION 5.1 Certain Duties and Responsibilities............ 46
SECTION 5.2 Notice of Defaults............................. 47
SECTION 5.3 Certain Rights of Trustee...................... 48
SECTION 5.4 Not Responsible for Recitals or
Issuance of Securities....................... 49
SECTION 5.5 May Hold Securities, Act as Trustee
Under Other Indentures....................... 49
SECTION 5.6 Money Held in Trust............................ 50
SECTION 5.7 Compensation and Indemnification of
Trustee and Its Prior
Claims....................................... 50
SECTION 5.8 Corporate Trustee Required;
Eligibility.................................. 51
SECTION 5.9 Resignation and Removal; Appointment
of Successor................................. 51
SECTION 5.10 Acceptance of Appointment by
Successor.................................... 52
SECTION 5.11 Merger, Conversion, Consolidation
or Succession to Business.................... 53
SECTION 5.12 Authenticating Agent.......................... 53
ARTICLE 6
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 6.1 Company May Consolidate, Etc., Only
on Certain Terms............................. 55
SECTION 6.2 Successor Corporation Substituted.............. 56
ARTICLE 7
SUPPLEMENTAL INDENTURES
SECTION 7.1 Supplemental Indentures Without
Consent of Holders of
Securities................................... 56
SECTION 7.2 Supplemental Indentures with Consent
of Holders of Securities..................... 57
SECTION 7.3 Execution of Supplemental Indentures........... 58
SECTION 7.4 Effect of Supplemental Indentures.............. 58
SECTION 7.5 Reference in Securities to
Supplemental Indentures...................... 59
SECTION 7.6 Notice of Supplemental Indentures.............. 59
ARTICLE 8
MEETING OF HOLDERS OF SECURITIES
SECTION 8.1 Purposes for Which Meetings May Be
Called....................................... 59
SECTION 8.2 Call Notice and Place of Meetings.............. 59
SECTION 8.3 Persons Entitled to Vote at Meetings........... 60
SECTION 8.4 Quorum; Action................................. 60
SECTION 8.5 Determination of Voting Rights;
Conduct and Adjournment of
Meetings..................................... 61
SECTION 8.6 Counting Votes and Recording Action
of Meetings.................................. 62
ARTICLE 9
COVENANTS
SECTION 9.1 Payment of Principal, Premium and
Interest..................................... 62
SECTION 9.2 Maintenance of Offices or Agencies............. 62
SECTION 9.3 Money for Security Payments To Be
Held in Trust................................ 63
SECTION 9.4 Corporate Existence............................ 65
SECTION 9.5 Maintenance of Properties...................... 65
SECTION 9.6 Payment of Taxes and Other Claims.............. 65
SECTION 9.7 Statement by Officers as to Default............ 65
SECTION 9.8 Waiver of Certain Covenants.................... 66
SECTION 9.9 Delivery of Certain Information................ 66
SECTION 9.10 Resale of Certain Securities.................. 66
ARTICLE 10
REDEMPTION OF SECURITIES
SECTION 10.1 Right of Redemption........................... 67
SECTION 10.2 Applicability of Article...................... 67
SECTION 10.3 Election to Redeem; Notice to
Trustee...................................... 67
SECTION 10.4 Selection by Trustee of Securities
To Be Redeemed............................... 67
SECTION 10.5 Notice of Redemption.......................... 68
SECTION 10.6 Deposit of Redemption Price................... 69
SECTION 10.7 Securities Payable on Redemption
Date......................................... 69
SECTION 10.8 Securities Redeemed in Part................... 70
ARTICLE 11
REPURCHASE UPON A DESIGNATED EVENT
SECTION 11.1 Repurchase Right.............................. 70
SECTION 11.2 Conditions to the Company's
Election to Pay the Repurchase
Price in Common Stock........................ 71
SECTION 11.3 Notices; Method of Exercising
Repurchase Right, Etc........................ 72
ARTICLE 12
CONVERSION OF SECURITIES
SECTION 12.1 Conversion Privilege and Conversion
Price........................................ 75
SECTION 12.2 Exercise of Conversion Privilege.............. 75
SECTION 12.3 Fractions of Shares........................... 77
SECTION 12.4 Adjustment of Conversion Price................ 77
SECTION 12.5 Notice of Adjustments of Conversion
Price........................................ 86
SECTION 12.6 Notice of Certain Corporate Action............ 86
SECTION 12.7 Company to Reserve Common Stock............... 87
SECTION 12.8 Taxes on Conversions.......................... 87
SECTION 12.9 Covenant as to Common Stock................... 88
SECTION 12.10 Cancellation of Converted
Securities................................... 88
SECTION 12.11 Effect of Reclassification,
Consolidation, Merger or Sale................ 88
SECTION 12.12 Responsibility of Trustee for
Conversion Provisions........................ 89
ARTICLE 13
SUBORDINATION
SECTION 13.1 Securities Subordinated to Senior
Debt......................................... 90
SECTION 13.2 Subrogation................................... 91
SECTION 13.3 Obligation of Company Unconditional........... 92
SECTION 13.4 Maturity of or Default on Senior
Debt......................................... 92
SECTION 13.5 Payments on Securities Permitted.............. 92
SECTION 13.6 Effectuation of Subordination by
Trustee...................................... 92
SECTION 13.7 Knowledge of Trustee.......................... 93
SECTION 13.8 Trustee's Relation to Senior Debt............. 93
SECTION 13.9 Rights of Holders of Senior Debt
Not Impaired................................. 94
SECTION 13.10 Modification of Terms of Senior
Debt......................................... 94
INDENTURE, dated as of October 4, 1996, between COMVERSE
TECHNOLOGY, INC., a corporation duly organized and existing under the laws
of the State of New York, having its principal office at 000 Xxxxxxxxx
Xxxx Xxxxx, Xxxxxxxx, Xxx Xxxx 00000 (herein called the "Company"), and
THE CHASE MANHATTAN BANK, a New York banking corporation, as Trustee
(herein called the "Trustee"), having its principal Corporate Trust
offices at 000 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its
5-3/4% Convertible Subordinated Debentures Due 2006 (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 and
duly issued by the Company, 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.
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:
ARTICLE 1
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
(2) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with U.S. generally accepted
accounting principles prevailing at the time of any relevant
computation hereunder; 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 1.3.
"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 Members" has the meaning specified in Section 2.5(d)(5).
"Applicable Procedures" has the meaning specified in Section
2.5(c)(2).
"Authenticating Agent" means any Person named as Authenticating
Agent pursuant to Section 5.12.
"Authorized Newspaper" means a newspaper, in an official
language of the country of publication or in the English language,
customarily published on each Business Day, whether or not published on
Saturdays, Sundays or holidays, and of general circulation in the place in
connection with which the term is used or in the financial community of
such place. Where successive publications are required to be made in such
newspapers, the successive publications may be made in the same or in
different newspapers in the same city meeting the foregoing requirements
and in each case on any Business Day.
"Board of Directors" means either the board of directors of the
Company or any 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 be in full force and effect on the date of
such certification, shall have been delivered to the Trustee.
3
"Business Day", when used with respect to any Place of Payment
or Place of Conversion, means each Monday, Tuesday, Wednesday, Thursday
and Friday which is not a day on which banking institutions in that Place
of Payment or Place of Conversion, as the case may be, are authorized or
obligated by law to close.
"Capitalized Lease Obligation" means, as applied to any Person,
any lease of any property (whether real, personal or mixed) by that Person
as lessee which, in conformity with U.S. generally accepted accounting
principles prevailing at the time of any relevant determination hereunder,
is required to be accounted for as a capital lease on the balance sheet of
that Person.
"CEDEL" means Cedel Bank, societe anonyme.
"Change in Control" means an event or series of events as a
result of which (i) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Exchange Act) is or becomes the
"beneficial owner" (as defined in Rule 13d-5 under the Exchange Act) of
shares representing more than 50% of the combined voting power of the then
outstanding securities entitled to vote generally in elections of
directors of the Company ("Voting Stock"); (ii) the Company consolidates
with or merges into any other corporation or conveys, transfers or leases
all or substantially all of its assets to any person, or any other
corporation merges into the Company, and in the case of any such
transaction, the outstanding Common Stock of the Company is changed or
exchanged into or for other assets or securities as a result, unless the
stockholders of the Company immediately before such transaction own,
directly or indirectly, immediately following such transaction, at least a
majority of the combined voting power of the outstanding voting securities
of the corporation resulting from such transaction in substantially the
same proportion as their ownership of the Voting Stock immediately before
such transaction; or (iii) at any time Continuing Directors do not
constitute a majority of the Board of Directors of the Company (or, if
applicable, a successor corporation of the Company); provided, however,
that a Change of Control shall not be deemed to have occurred if either
(x) the closing price per share of the Common Stock for any five trading
days within the period of ten consecutive trading days ending immediately
before the Change of Control shall equal or exceed 105% of the conversion
price of the Securities in effect on each such trading day, or (y) at
least 90% of the consideration (excluding cash payments for dissenting and
fractional shares) in the transaction or transactions constituting the
Change of Control consists of shares of common stock or securities
convertible into common stock that are, or immediately upon issuance will
be, listed on a national securities exchange or The Nasdaq Stock Market
and as a result of the transaction or transactions such Securities become
convertible solely into such common stock.
"Closing Date" means October 4, 1996 or such later date on which
the Securities may be delivered pursuant to the Purchase Agreement.
4
"Common Stock" includes any stock of any class of the Company
which has no preference in respect of dividends or of amounts payable in
the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and which is not subject to redemption by the
Company. However, subject to the provisions of Section 12.11, shares
issuable on conversion of Securities shall include only shares of the
class designated as Common Stock, par value $0.10 per share, of the
Company at the date of this Indenture or shares of any class or classes
resulting from any reclassification or reclassifications thereof and which
have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding
up of the Company and which are not subject to redemption by the Company,
provided that if at any time there shall be more than one such resulting
class, the shares of each such class then so issuable shall be
substantially in the proportion which the total number of shares of such
class resulting from all such reclassifications bears to the total number
of shares of all such classes resulting from all such reclassifications.
"Company" means the corporation named as the "Company" in the
first paragraph of this instrument until a successor corporation shall
have become such pursuant to the applicable provisions of this Indenture,
and thereafter "Company" shall mean such successor corporation.
"Company Notice" has the meaning specified in Section 11.2.
"Company Request" or "Company Order" means a written request or
order signed in the name of the Company by the Chairman of the Board, the
Chief Executive Officer, Chief Financial Officer, a Vice Chairman of the
Board, the President or a Vice President, and by the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary of the
Company, and delivered to the Trustee.
"Continuing Director" means at any date a member of the
Company's Board of Directors (i) who was a member of such board on October
1, 1996 or (ii) who was nominated or elected by at least a majority of the
directors who were Continuing Directors at the time of such nomination or
election or whose election to the Company's Board of Directors was
recommended or endorsed by at least a majority of the directors who were
Continuing Directors at the time of such nomination or election. (Under
this definition, if the current Board of Directors of the Company were to
approve a new director or directors and then resign, no Change of Control
would occur even though the current Board of Directors would thereafter
cease to be in office.)
"Conversion Agent" means any Person authorized by the Company
pursuant to Section 9.2 to convert Securities in accordance with Article
12.
"Conversion Price" has the meaning specified in Section 12.1.
5
"Corporate Trust Office" means the office of the Trustee located
in The City of New York at which at any particular time its corporate
trust business shall be administered (which at the date of this Indenture
is located at 450 West 33rd Street, 15th Floor, New York, New York, New
York 10001).
"corporation" includes corporations, associations, companies and
business trusts.
"Custodian" shall mean The Chase Manhattan Bank, as custodian
with respect to the Securities in global form, or any successor entity
thereto.
"Defaulted Interest" has the meaning specified in Section 2.7.
"Depositary" shall mean, with respect to the Securities issuable
or issued in whole or in part in global form, the person specified in
Section 2.5(e) as the Depositary with respect to such Securities, until a
successor shall have been appointed and become such pursuant to the
applicable provisions of this Indenture, and thereafter, "Depositary"
shall mean or include such successor.
"Designated Event" means a Change in Control or a Termination of
Trading.
"Dollar", "U.S. 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.
"EUROCLEAR" means the Euroclear Clearance System.
"Event of Default" has the meaning specified in Section 4.1.
"Exchange Act" means the U.S. Securities Exchange Act of 1934,
as amended.
"Exchange Rate Contract" means, with respect to any Person, any
currency swap agreements, forward exchange rate agreements, foreign
currency futures or options, exchange rate collar agreements, exchange
rate insurance and other agreements or arrangements, or combination
thereof, designed to provide protection against fluctuations in currency
exchange rates.
"Global Security" means any of the Restricted Global Security
and the Regulation S Global Security.
"guarantee" means, as applied to any obligation, (i) a guarantee
(other than by endorsement of negotiable instruments for collection in the
ordinary course of business),
6
direct or indirect, in any manner, of any part or all of such obligation
and (ii) an agreement, direct or indirect, contingent or otherwise, the
effect of which is to assure in any way the payment or performance (or
payment of damages in the event of non-performance) of any part or all of
such obligation, including, without limiting the foregoing, the payment of
amounts drawn down by letters of credit.
"Hedging Agreement" means any Interest Rate Protection Agreement
or Exchange Rate Contract.
"Holder", when used with respect to any Security, means in the
case of a Security in registered form the Person in whose name the
Security is registered in the Security Register and in the case of the
Global Security the bearer thereof.
"IAI Letter" has the meaning specified in Section 2.3.
"Indebtedness", when used with respect to any Person, means (a)
any liability of such Person for borrowed money, or evidenced by an
instrument for the payment of money, or incurred in connection with the
acquisition of any property, services or assets (including securities) or
relating to a Capitalized Lease Obligation; (b) obligations under Hedging
Agreements; (c) any obligation of such Person to reimburse the issuer of a
letter of credit, surety bond, performance bond or other guarantee of
contractual performance and (d) any liability of any other Person of the
type referred to in clauses (a), (b) or (c) which has been assumed or
guaranteed by such Person; provided, however, that Indebtedness shall not
include accounts payable or other obligations of such Person to trade
creditors created or assumed by such Person in the ordinary course of
business in connection with the obtaining of materials or services.
"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.
"Interest Payment Date" means the Stated Maturity of an
installment of interest on the Securities.
"Interest Rate Protection Agreement" means, with respect to any
Person, any interest rate swap agreement, interest rate cap or collar
agreement or other financial agreement or arrangement designed to protect
such person against fluctuations in interest rates, as in effect from time
to time.
"Internal Revenue Code" means the U.S. Internal Revenue Code of
1986, as amended.
7
"Institutional Accredited Investor" means an institutional
accredited investor within the meaning of Rule 501(a)(1), (2), (3) or (7)
of Regulation D under the Securities Act.
"Liquidated Damages" means all liquidated damages, if any,
payable pursuant to Section 3 of the Registration Rights Agreement.
"Maturity" 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 acceleration, conversion, call for redemption,
exercise of a Repurchase Right or otherwise.
"Nasdaq National Market" means the Nasdaq National Market or any
successor national securities exchange or automated over-the-counter
trading market in the United States.
"Non-Electing Share" has the meaning specified in Section 12.11.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the Chief Executive Officer, the President or a
Vice President and by the Chief Financial Officer, the Treasurer or the
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 may include directors or employees of the
Company) and which opinion is acceptable to the Trustee which acceptance
shall not be unreasonably withheld.
"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; and
8
(iii) Securities which have been paid pursuant to Section 2.6 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 such
Securities of which the Trustee has received written notice and are so
owned shall be so disregarded. Securities so owned which have been pledged
in good faith may be regarded as Outstanding if the pledgee establishes to
the satisfaction of the Trustee the pledgee's right so to act with respect
to such Securities and that the pledgee is not the Company or any other
obligor upon the Securities or any Affiliate of the Company or such other
obligor.
"Paying Agent" means any Person authorized by the Company to pay
the principal of, and premium, if any, or interest (including Liquidated
Damages, if any) on any Securities on behalf of the Company.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, estate, unincorporated
organization or government or any agency or political subdivision thereof.
"Place of Conversion" has the meaning specified in Section 2.1.
"Place of Payment" has the meaning specified in Section 2.1.
"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 2.6 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 October
1, 1996, between the Company and Xxxxxx Brothers Inc.
9
"QIB" shall mean a "qualified institutional buyer" as defined in
Rule 144A.
"Quoted Price" of the Common Stock means the last reported sale
price of the Common Stock on the Nasdaq National Market, or, if the Common
Stock is listed on a national securities exchange, then on such exchange,
or if the Common Stock is not quoted on Nasdaq National Market or listed
on an exchange, the average of the last bid and asked price on the
National Association of Securities Dealers Automated Quotation System, in
each case as determined by the Board of Directors.
"Record Date" means either a Regular Record Date or a Special
Record Date, as the case may be.
"Redemption Date", when used with respect to any Security to be
redeemed or repurchased, means the date fixed for such redemption or
repurchase by or pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which such Security is to be redeemed
pursuant to this Indenture.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of October 4, 1996, between the Company and the Xxxxxx
Brothers Inc.
"Regular Record Date" for the interest payable means the March
15 (whether or not a Business Day) next preceding an April 1 Interest
Payment Date and the September 15 (whether or not a Business Day) next
preceding an October 1 Interest Payment Date.
"Regulation S" means Regulation S as promulgated under the
Securities Act.
"Regulation S Global Security" has the meaning specified in
Section 2.2.
"Repurchase Right" has the meaning specified in Section 11.1.
"Responsible Officer", when used with respect to the Trustee,
means any officer within the Corporate Trust Office of the Trustee,
including any vice president, assistant vice president, secretary,
assistant secretary, the treasurer, any assistant treasurer, the managing
director or any other officer 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 such
officer's knowledge of and familiarity with the particular subject.
"Restricted Global Security" has the meaning specified in
Section 2.2.
"Restricted Period" has the meaning specified in Section 2.2.
10
"Restricted Securities" means the Securities defined as such in
Section 2.5(e).
"Rule 144" means Rule 144 under the Securities Act (including
any successor rule thereof), as the same may be amended from time to time.
"Rule 144A" shall mean Rule 144A as promulgated under the
Securities Act (including any successor rule thereof), as the same may be
amended from time to time.
"Rule 144A Information" has the meaning specified in Section
9.9.
"Securities" has the meaning ascribed to it in the first
paragraph under the caption "Recitals of the Company".
"Securities Act" means the U.S. Securities Act of 1933, as
amended.
"Securities Register" and "Security Register" have the
respective meanings specified in Section 2.5(a).
"Senior Debt" means all Indebtedness of the Company outstanding
at any time, except (i) Indebtedness of the Company that by its terms is
expressly pari passu with or subordinate in right of payment to the
Securities; (ii) any indebtedness or other obligations of the Company in
respect of its 5-1/4% Convertible Subordinated Debentures due 2003; (iii)
accounts payable or any other Indebtedness of the Company to trade
creditors created or assumed by the Company in the ordinary course of
business in connection with the obtaining of materials or services; or
(iv) any liability for federal, state, local or other taxes owed or owing
by the Company.
"Significant Subsidiary" means any Subsidiary which is a
"significant subsidiary" within the meaning of Rule 405 under the
Securities Act.
"Special Record Date" for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 2.7.
"Stated Maturity" means the date specified in any Security as
the fixed date for the payment of principal on such Security or on which
an installment of interest on such Security 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 only, "voting
stock" means stock which ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class of
stock has such voting power by reason of any contingency.
11
"Termination of Trading" means such time as the Common Stock (or
other common stock into which the Securities are then convertible) is
neither listed for trading on a U.S. national securities exchange nor
approved for trading on an established automated over- the-counter trading
market in the United States.
"Transfer Agent" means any Person, which may be the Company,
authorized by the Company to exchange or register the transfer of
Securities.
"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.
"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 Form of Documents Delivered to 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 an Opinion of Counsel,
unless such officer knows, or in the exercise of reasonable care should
know, that the Opinion of Counsel with respect to the matters upon which
such certificate or opinion is based is erroneous. Any such Opinion of
Counsel may be based, insofar as it relates to factual matters, upon a
certificate or representations by, an officer or officers of the Company
stating that the information with respect to such factual matters is in
the possession of the Company, unless such counsel knows, or in the
exercise of reasonable care should know, that the certificate 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.
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
12
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 shall include:
(1) a statement that each individual signing such certificate or
opinion on behalf of the Company has read such covenant or condition
and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each 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 Acts of Holders of Securities.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided 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 agent or proxy duly appointed in writing, (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 8 or (3)
a combination of such instruments and any such record. Except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments or record or both are delivered to the Trustee
and, where it is hereby expressly required, to the Company. Such
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 5.1) conclusive in favor of
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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 8.6.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be provided in any manner which the Trustee
reasonably deems sufficient.
(c) The principal amount and serial numbers of Securities held
by any Person, and the date of such Person holding the same, shall be
proved by the Security Register.
(d) Any request, demand, authorization, direction, notice,
consent, election, waiver or other Act of the Holders of any Security
shall bind every future Holder of the same Security and the Holder of
every Security issued upon the registration of transfer thereof or in
exchange therefor or in lieu thereof in respect of anything done, omitted
or suffered to be done by the Trustee or the Company in reliance thereon,
whether or not notation of such action is made upon such Security.
SECTION 1.4 Notices, Etc., to Trustee and Company.
Any request, demand, authorization, direction, notice, consent,
election, waiver or 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 in writing,
mailed, first-class postage prepaid or telecopied at (000) 000-0000
and confirmed by mail, first-class postage prepaid, addressed to it
at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, to the attention
of Global Trust Services, or in the case of notice by telecopy
confirmed at (212) 946- 3082, or at any other address or telecopy
number otherwise furnished in writing to the Company by the Trustee;
or
(2) the Company by the Trustee or by any Holder of Securities
shall be sufficient for every purpose hereunder (unless otherwise
herein expressly provided) if in writing, mailed, first-class postage
prepaid or telecopied at (000) 000-0000 and confirmed by mail,
first-class postage prepaid, addressed to it at 000 Xxxxxxxxx Xxxx
Xxxxx, Xxxxxxxx, Xxx Xxxx 00000, to the attention of its President,
with a copy to its Chief Financial Officer, or at any other address
or telecopy number otherwise furnished in writing to the Trustee by
the Company.
Any request, demand, authorization, direction, notice, consent,
election or waiver required or permitted under this Indenture shall be in
the English language.
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SECTION 1.5 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 of Securities if published
in an Authorized Newspaper in The City of New York on a Business Day at
least twice, the first such publication to be not earlier than the
earliest date and the second not later than the latest date prescribed for
the giving of such notice, and given 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.
In case by reason of the suspension of publication of any
Authorized Newspaper or Authorized Newspapers or by reason of any other
cause it shall be impracticable to publish any notice to Holders of
Securities as provided above, then such notification to Holders of
Securities as shall be given with the approval of the Trustee shall
constitute sufficient notice to such Holders for every purpose hereunder.
In any case where notice to Holders of Securities is given by
mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder of a Security shall affect the
sufficiency of such notice with respect to other Holders of 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 Securities as shall be made with the
approval of the Trustee shall constitute a sufficient notification to such
Holders for every purpose hereunder.
Such notices shall be deemed to have been given on the date of
such publication or mailing or, if published in Authorized Newspapers on
different dates, on the date of the first such publication.
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 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 1.6 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.
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SECTION 1.7 Successors and Assigns.
All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
SECTION 1.8 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 1.9 Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder, the holders of Senior Debt and the Holders of
Securities, any benefit or legal or equitable right, remedy or claim under
this Indenture.
SECTION 1.10 GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REFERENCE TO SUCH STATE'S CONFLICT OF LAWS PRINCIPLES.
SECTION 1.11 Counterparts.
This instrument may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original but all
such counterparts shall together constitute but one and the same
instrument.
SECTION 1.12 Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or
Stated Maturity of any Security or the last day on which a Holder of a
Security has a right to convert such Security shall not be a Business Day at
any Place of Payment or Place of Conversion, then (notwithstanding any other
provision of this Indenture or of the Securities) payment of interest
(including Liquidated Damages, if any) or principal or premium, if any, or
conversion of the Securities, need not be made at such Place of Payment or
Place of Conversion on such day, but may be made on the next succeeding
Business Day at such Place of Payment or Place of Conversion with the same
force and effect as if made on the Interest Payment Date or Redemption Date
or at the Stated Maturity or on such last day for conversion, provided, that
in the case that payment is made on such succeeding Business
16
Day, no interest shall accrue on the amount so payable for the period from
and after such Interest Payment Date, Redemption Date or Stated Maturity, as
the case may be.
SECTION 1.13 Recourse Against Others.
No recourse for the payment of the principal of or premium, if
any, or interest (including Liquidated Damages, if any) on any Security, or
for any claim based thereon or otherwise in respect thereof, shall be had
against any incorporator, shareholder, officer or director, as such, past,
present or future, of the Company or of any successor corporation, whether
by virtue of any constitution, statute or rule of law or by the enforcement
of any assessment or penalty or otherwise, all such liability being, by the
acceptance thereof and as part of the consideration for the issue thereof,
expressly waived and released.
ARTICLE 2
THE SECURITIES
SECTION 2.1 Title and Terms.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is limited to U.S.
$100,000,000 (or $115,000,000 if the over- allotment option set forth in
Section 2(b) of the Purchase Agreement is exercised in full), except for
securities authenticated and delivered upon registration of transfer of, or
in exchange for, or in lieu of other Securities pursuant to Section 2.5,
2.6, 7.5, 10.8, 11.3 or 12.2.
The Securities shall be known and designated as the "5-3/4%
Convertible Subordinated Debentures Due 2006" of the Company. Their Stated
Maturity shall be October 1, 2006 and they shall bear interest from October
4, 1996, payable semiannually in arrears on April 1 and October 1 in each
year, commencing April 1, 1997, at the rate of 5-3/4% per annum until the
principal thereof is paid or made available for payment.
The principal of and premium, if any, and interest (including
Liquidated Damages, if any) on the Securities shall be payable as provided
in the form of Security set forth in Exhibit A hereto (any city in which any
Paying Agent is located being herein called a "Place of Payment").
The Securities shall be redeemable at the option of the Company,
and shall have a Repurchase Right exercisable at the option of Holders, as
provided in the form of Security set forth in Exhibit A hereto and in
Articles 10 and 11.
17
The Securities shall be convertible as provided in Article 12 (any
city in which any Conversion Agent is located being herein called a "Place
of Conversion").
The Securities shall be subordinated in right of payment to Senior
Debt of the Company as provided in Article 13.
SECTION 2.2 Form of Securities.
The Securities and the Trustee's certificate of authentication to
be borne by such Securities shall be substantially in the form set forth in
Exhibit A, which is incorporated in and made a part of this Indenture.
Any of the Securities may have such letters, numbers or other
marks of identification and such notations, legends and endorsements as the
officers executing the same may approve (execution thereof to be conclusive
evidence of such approval) and as are not inconsistent with the provisions
of this Indenture, or as may be required to comply with any law or with any
rule or regulation made pursuant thereto or with any rule or regulation of
any securities exchange or automated quotation system on which the
Securities may be listed or designated for issuance, or to conform to usage.
Securities offered and sold in their initial distribution in
reliance on Regulation S shall be initially represented by one or more
Global Securities (collectively, the "Regulation S Global Security") issued
in fully registered form without interest coupons, substantially in the form
of Security set forth in Exhibit A, with such applicable legends as are
provided for in Exhibit A. Such Regulation S Global Security shall be
registered in the name of the Depositary or its nominee and deposited with
the Custodian, duly executed by the Company and authenticated by the Trustee
as hereinafter provided, for credit to the respective accounts at the
Depositary of the depositories for Xxxxxx Guaranty Trust Company of New
York, Brussels office, as operator of Euroclear, or CEDEL. Until such time
as the Restricted Period shall have terminated, investors may hold
beneficial interests in such Regulation S Global Securities only through
Euroclear and CEDEL, unless delivery of such beneficial interest shall be
made through the Restricted Global Security in accordance with the
certification requirements discussed below in Section 2.5(b)(3) or
2.5(b)(5). After such time as the Restricted Period shall have terminated,
such certification requirements shall no longer be required for such
transfers. As used herein, the term "Restricted Period" means the period up
to (but not including) the 40th day following the later of (i) the date of
the commencement of the offering of Securities and (ii) the last original
issuance date of the Securities.
Securities offered and sold in their initial distribution in
reliance on Rule 144A shall be issued in the form of one or more Global
Securities (collectively, the "Restricted Global Security") in fully
registered form without interest coupons, substantially in the form of
Security set forth in Exhibit A, with such applicable legends as are
provided for in Exhibit
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A. Such Restricted Global Security shall be registered in the name of the
Depositary or its nominee and deposited with the Custodian, duly executed by
the Company and authenticated by the Trustee as hereinafter provided. The
aggregate principal amount of the Restricted Global Security may be
increased or decreased from time to time by adjustments made on the records
of the Custodian in connection with a corresponding decrease or increase in
the aggregate principal amount of the Regulation S Global Security, as
hereinafter provided.
The terms and provisions contained in the form of Security
attached as Exhibit A hereto shall constitute, and is hereby expressly made,
a part of this Indenture and to the extent applicable, the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree
to such terms and provisions and to be bound thereby.
SECTION 2.3 Denominations.
The definitive Securities shall be issuable in fully registered
form, without coupons, in denominations of U.S. $1,000 or integral multiples
of U.S. $1,000 in excess thereof, except that Securities offered other than
in reliance on Regulation S or to QIBs shall be issued only initially in
minimum denominations of $250,000 and integral multiples of $1,000 in excess
thereof. Such Securities (i.e., Securities sold to Institutional Accredited
Investors) will be subject to restrictions on transfer in accordance with a
form of Letter for Institutional Accredited Investors (the "IAI Letter"),
that such investors will be required to sign, the form of which is attached
hereto as Exhibit B.
SECTION 2.4 Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Chief Executive Officer, its President or one of
its Vice Presidents, under a facsimile of its corporate seal reproduced
thereon attested by its Secretary or one of its Assistant Secretaries. Any
such signature may be manual or facsimile.
Securities bearing the manual or facsimile signature of
individuals who were at any time the proper officers of the Company shall
bind the Company, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of such
Securities or did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities executed by the
Company to the Trustee 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 deliver such
Securities as in this Indenture provided and not otherwise.
Each Security in registered form shall be dated the date of its
authentication.
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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 or on behalf of the Trustee by manual signature, 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 2.5 Registration, Registration of Transfer and Exchange;
Restrictions on Transfer.
(a) The Company shall cause to be kept at the Corporate Trust
Office of the Trustee a register (the "Security Register") in which, subject
to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of Securities and of transfers of Securities.
The Trustee is hereby appointed "Security Registrar" for the purpose of
registering Securities and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security at any
office or agency of the Company designated pursuant to Section 9.2 for such
purpose, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or
more new Securities of any authorized denominations and of a like aggregate
principal amount and bearing such restrictive legends as may be required by
this Indenture.
Subject to the other provisions of this Section 2.5(a), Securities
may be exchanged for other Securities of any authorized denominations and of
a like aggregate principal amount, upon surrender of the Securities to be
exchanged at any such office or agency. Whenever any Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the
exchange is entitled to receive, bearing registration numbers not
contemporaneously outstanding.
All Securities issued upon any registration of transfer or
exchange of Securities shall be valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as
the Securities surrendered upon such registration of transfer or exchange.
None of the Company, the Trustee, the Security Registrar or any
co-registrar shall be required to exchange or register a transfer of (i) any
Securities for a period of fifteen (15) days next preceding any selection of
Securities to be redeemed or (ii) any Securities called for redemption or,
if a portion of any Security is selected or called for redemption, such
portion thereof selected or called for redemption or (iii) any Securities
surrendered for
20
conversion or, if a portion of any Security is surrendered for conversion,
such portion thereof surrendered for conversion.
Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the
Trustee) be duly endorsed by, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar and
duly executed by, the Holder thereof or such Holder's attorney duly
authorized in writing.
No service charge shall be made to any Holder for any registration
of transfer or exchange of Securities, but the Company may require payment
of a sum sufficient to cover any tax or other governmental charge that may
be imposed in connection therewith.
(b) Notwithstanding any other provisions of this Indenture or the
Securities (but subject to Section 2.2), transfers of a Global Security, in
whole or in part, transfers and exchanges of interests therein of the kinds
described in clauses (2), (3), (4), (5), (6) and (7) below and exchanges of
interests in Global Securities, and transfers or exchanges of other
Securities as described in clause (8) below, shall be made only in
accordance with this Section 2.5(b). Transfers and exchanges subject to this
Section 2.5 shall also be subject to the other provisions of this Indenture
that are not inconsistent with this Section 2.5.
(1) Limitation on Transfers of a Global Security. A Global
Security may not be transferred, in whole or in part, to any Person
other than the Depositary or a nominee thereof, and no such transfer to
any such other Person may be registered; provided that this clause (1)
shall not prohibit any transfer of a Security that is issued in
exchange for a Global Security but is not itself a Global Security. No
transfer of a Security to any Person shall be effective under this
Indenture or the Securities unless and until such Security has been
registered in the name of such Person. Nothing in this Section
2.5(b)(1) shall prohibit or render ineffective any transfer of a
beneficial interest in a Global Security effected in accordance with
the other provisions of this Section 2.5(b).
(2) Restricted Global Security to Regulation S Global Security. If
the holder of a beneficial interest in the Restricted Global Security
wishes at any time to transfer such interest to a Person who wishes to
take delivery thereof in the form of a beneficial interest in the
Regulation S Global Security, such transfer may be effected, subject to
the rules and procedures of the Depositary, Euroclear and CEDEL, in
each case to the extent applicable (the "Applicable Procedures"), only
in accordance with this Section 2.5(b)(2). Upon receipt by the Trustee,
as Security Registrar, at its office in The City of New York of (A)
written instructions given in accordance with the Applicable Procedures
from an Agent Member directing the Trustee to credit or cause to be
credited to a specified Agent Member's account a beneficial interest in
the Regulation S Global Security in a principal amount equal to that of
the beneficial
21
interest in the Restricted Global Security to be so transferred, (B) a
written order given in accordance with the Applicable Procedures
containing information regarding the account of the Agent Member (and,
if applicable, the Euroclear or CEDEL account, as the case may be) to
be credited with, and the account of the Agent Member to be debited
for, such beneficial interest and (C) a certificate in substantially
the form set forth in Exhibit C given by the holder of such beneficial
interest, the Trustee, as Security Registrar, shall instruct the
Depositary to reduce the principal amount of the Restricted Global
Security, and to increase the principal amount of the Regulation S
Global Security, by the principal amount of the beneficial interest in
the Restricted Global Security to be so transferred, and to credit or
cause to be credited to the account of the Person specified in such
instructions (which during the Restricted Period shall be the Agent
Member for Euroclear or CEDEL or both, as the case may be) a beneficial
interest in the Regulation S Global Security having a principal amount
equal to the amount by which the principal amount of the Restricted
Global Security was reduced upon such transfer.
(3) Regulation S Global Security to Restricted Global Security. If
during the Restricted Period the holder of a beneficial interest in the
Regulation S Global Security wishes to transfer such interest to a
Person who wishes to take delivery thereof in the form of a beneficial
interest in the Restricted Global Security, such transfer may be
effected, subject to the Applicable Procedures, only in accordance with
this Section 2.5(b)(3). Upon receipt by the Trustee, as Security
Registrar, at its office in The City of New York of (A) written
instructions given in accordance with the Applicable Procedures from an
Agent Member directing the Trustee to credit or cause to be credited to
a specified Agent Member's account of a beneficial interest in the
Restricted Global Security in a principal amount equal to that of the
beneficial interest in the Regulation S Global Security to be so
transferred, (B) a written order given in accordance with the
Applicable Procedures containing information regarding the account of
the Agent Member to be credited with, and the account or the Agent
Member (and, if applicable, the Euroclear or CEDEL account, as the case
may be) to be debited for, such beneficial interest and (C) a
certificate in substantially the form set forth in Exhibit D given by
the holder of such beneficial interest, the Trustee, as Security
Registrar, shall instruct the Depositary to reduce the principal amount
of the Regulation S Global Security and to increase the principal
amount of the Restricted Global Security, by the principal amount of
the beneficial interest in the Regulation S Global Security to be so
transferred, and to credit or cause to be credited to the account of
the Person specified in such instructions a beneficial interest in the
Restricted Global Security having a principal amount equal to the
amount by which the principal amount of the Regulation S Global
Security, as the case may be, was reduced upon such transfer.
22
(4) Restricted Global Security to Restricted Global Security. If
the holder of a beneficial interest in the Restricted Global Security
wishes at any time to transfer such interest to a Person who wishes to
take delivery thereof in such form, such transfer may be effected,
subject to the Applicable Procedures, only in accordance with this
Section 2.5(b)(4). Upon receipt by the Trustee, as Security Registrar,
at its office in The City of New York of (A) a written order given in
accordance with the Applicable Procedures containing information
regarding the account of the Agent Member to be credited with, and the
account of the Agent Member to be debited for, such beneficial interest
and (B) a certificate in substantially the form set forth in Exhibit D
given by the holder of such beneficial interest, the Trustee, as
Security Registrar, shall instruct the Depositary to credit or cause to
be credited to the account of the Person specified in such instructions
to be credited a beneficial interest in the Restricted Global Security
having a principal amount equal to the amount specified in such
instructions.
(5) Regulation S Global Security to Regulation S Global Security.
If the holder of a beneficial interest in the Regulation S Global
Security wishes at any time to transfer such interest to a Person who
wishes to take delivery thereof in such form, such transfer may be
effected, subject to the Applicable Procedures, only in accordance with
this Section 2.5(b)(5). Upon receipt by the Trustee, as Security
Registrar, at its office in The City of New York of (A) a written order
given in accordance with the Applicable Procedures containing
information regarding the account of the Agent Member (and, if
applicable, the Euroclear or CEDEL account, as the case may be) to be
credited with, and the account of the Agent Member (and, if applicable,
the Euroclear or CEDEL account, as the case may be) to be debited for,
such beneficial interest and (B) a certificate in substantially the
form set forth in Exhibit C given by the holder of such beneficial
interest, the Trustee, as Security Registrar, shall instruct the
Depositary to credit or cause to be credited to the account of the
Person specified in such instructions (which during the Restricted
Period shall be the Agent Member for Euroclear or CEDEL or both, as the
case may be) to be credited a beneficial interest in the Regulation S
Global Security having a principal amount equal to the amount specified
in such instructions.
(6) Exchanges. In the event that a Restricted Global Security or
any portion thereof is exchanged for a Regulation S Global Security or
Securities other than Global Securities, such Global Security or
Securities may in turn be exchanged (on transfer or otherwise) for
Securities that are not Global Securities or for beneficial interests
in a Global Security (if any is then outstanding) only in accordance
with such procedures, which shall be substantially consistent with the
provisions of clauses (1) through (3) above and (5) below (including
the certification requirements intended to insure that the transfers
and exchanges of beneficial interests in a Global Security comply with
Rule 144A, Rule 144 or Regulation S, as the case may be) and any
23
Applicable Procedures, as may be from time to time adopted by the
Company and the Trustee.
(5) Interests in Regulation S Global Security to be Held Through
Euroclear or CEDEL. Until the termination of the Restricted Period,
interests in the Regulation S Global Security may be held only through
Agent Members acting for and on behalf of Euroclear and CEDEL, provided
that this Clause (7) shall not prohibit any transfer in accordance with
Section 2.5(b)(3) or Section 2.5(b)(5) hereof.
(6) Securities Originally Issued to Institutional Accredited
Investors. Securities may be issued other than in reliance on Rule 144A
or Regulation S, and such Securities will be issued only in definitive
certificated form and, initially, only in minimum denominations of
$250,000 and integral multiples of $1,000 in excess thereof. Such
Securities (i.e., Securities sold to Institutional Accredited
Investors) will be subject to restrictions on transfer in accordance
with the IAI Letter. Furthermore, in case a Security held by an
Institutional Accredited Investor is to be transferred (whether during
or after the Restricted Period) in a transaction exempt (i) pursuant to
Rule 144A, then the transferor shall deliver a certificate
substantially in the form of Exhibit D hereto, or (ii) pursuant to
Regulation S, then the transferor shall deliver a certificate
substantially in the form of Exhibit C hereto, in each case with such
changes in the second paragraph thereof as are appropriate to reflect
the facts and circumstances, including that the Holder will be
transferring a Security in the form of a definitive registered
certificate. (However, a transfer or exchange that does not involve any
change in beneficial ownership shall not be considered to be a transfer
that triggers these certification requirements.) The Company may vary
these procedures or impose other reasonable procedures to ensure
compliance with the agreement of such Holder contained in its IAI
Letter.
(c) Each Restricted Security and Global Security issued hereunder
shall, upon issuance, bear the legends required by Section 2.5(e) to be
applied and such required legends shall not be removed except as provided in
the next sentence or paragraph (d) of this Section 2.5. The legend required
for a Restricted Security may be removed if there is delivered to the
Company such satisfactory evidence, which may include an opinion of
independent counsel licensed to practice law in the State of New York, as
may be reasonably required by the Company that neither such legend nor the
restrictions on transfer set forth therein are required to ensure that
transfers of such Security will not violate the registration requirements of
the Securities Act. Upon provision of such satisfactory evidence, the
Trustee, at the written direction of the Company, shall authenticate and
deliver in exchange for such Securities another Security or Securities
having an equal aggregate principal amount that does not bear such legend.
If such a legend required for a Restricted Security has been removed from a
Security as provided above, no other Security issued in exchange for all or
any part of such Security shall bear such legend, unless the Company has
reasonable cause to
24
believe that such other Security is a "restricted security" within the
meaning of Rule 144 and instructs the Trustee in writing to cause a legend
to appear thereon.
(d) The provisions of clauses (1), (2), (3) and (4) below shall
apply only to Global Securities:
(1) Each Global Security authenticated under this Indenture shall
be registered in the name of the Depositary 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.
(2) Notwithstanding any other provision in this Indenture or the
Securities, 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 or a nominee thereof unless (A) the Depositary (i) has
notified the Company that it is unwilling or unable to continue as
Depositary for such Global Security or (ii) has ceased to be a clearing
agency registered under the Exchange Act, (B) in the case of a Global
Security held for an account of Euroclear or CEDEL, Euroclear or CEDEL,
as the case may be, (i) is closed for business for a continuous period
of 14 days (other than by reason of statutory or other holidays) or
(ii) announces an intention permanently to cease business or does in
fact do so, (C) there shall have occurred and be continuing an Event of
Default with respect to such Global Security or (D) a request for
certificates has been made upon the Trustee in accordance with the
Depositary's customary procedures and a copy of such notice has been
received by the Company from the Trustee. Any Global Security exchanged
pursuant to clause (A) or (B) above shall be so exchanged in whole or
in part and any Global Security exchanged pursuant to clause (C) or (D)
above may be exchanged in whole or from time to time in part as
directed by the Depositary. Any Security issued in exchange for a
Global Security or any portion thereof shall be a Global Security,
provided that any Security so issued that is registered in the name of
a Person other than the Depositary or a nominee thereof shall not be a
Global Security.
(3) Securities issued in exchange for a Global Security or any
portion thereof pursuant to clause (2) above shall be issued in
definitive, fully registered form, without interest coupons, shall have
an aggregate principal amount equal to that of such Global Security or
portion thereof to be so exchanged, shall be registered in such names
and be in such authorized denominations as the Depositary shall
designate and shall bear any legends required hereunder. Any Global
Security to be exchanged in whole shall be surrendered by the
Depositary to the Trustee, as Security Registrar. With regard to any
Global Security to be exchanged in part, either such Global Security
shall be so surrendered for exchange or, if the Trustee is acting as
custodian for the Depositary or its nominee with respect to such Global
Security, the principal
25
amount thereof shall be reduced, by an amount equal to the portion
thereof to be so exchanged, by means of an appropriate adjustment made
on the records of the Trustee. Upon any such surrender or adjustment,
the Trustee shall authenticate and make available for delivery the
Security issuable on such exchange to or upon the written order of the
Depositary or an authorized representative thereof.
(4) In the event of the occurrence of any of the events specified
in clause (2) above, the Company will promptly make available to the
Trustee a reasonable supply of certificated Securities in definitive,
fully registered form, without interest coupons.
(5) Neither any members of, or participants in, the Depositary
("Agent Members") nor any other Persons on whose behalf Agent Members
may act (including Euroclear and CEDEL and account holders and
participants therein) shall have any rights under this Indenture with
respect to any Global Security, or under any Global Security, and the
Depositary or such nominee, as the case may be, may be treated by the
Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner and holder of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent
the Company, the Trustee or any agent of the Company or Trustee from
giving effect to any written certification, proxy or other
authorization furnished by the Depositary or such nominee, as the case
may be, or impair, as between the Depositary, its Agent Members and any
other person on whose behalf an Agent Member may act, the operation of
customary practices of such Persons governing the exercise of the
rights of a holder of any Security.
(e) Every Security that bears or is required under this Section
2.5(e) to bear the legend set forth in this Section 2.5(e) (together with
any Common Stock issued upon conversion of the Securities and required to
bear the legend set forth in Section 2.5(f), collectively, the "Restricted
Securities") shall be subject to the restrictions on transfer set forth in
this Section 2.5(e) (including the legend set forth below), unless such
restrictions on transfer shall be waived by written consent of the Company,
and the Holder of each such Restricted Security, by such Holder's acceptance
thereof, agreed to be bound by all such restrictions on transfer. As used in
Sections 2.5(e) and 2.5(f), the term "transfer" encompasses any sale,
pledge, transfer or other disposition whatsoever of any Restricted Security.
Until three (3) years after the original issuance date of any
Security, any certificate evidencing such Security (and all securities
issued in exchange therefor or substitution thereof, other than Common
Stock, if any, issued upon conversion thereof which shall bear the legend
set forth in Section 2.5(f), if applicable) shall bear a legend in
substantially the following form (unless such Securities have been
transferred pursuant to a registration statement that has been declared
effective under the Securities Act (and which
26
continues to be effective at the time of such transfer) or unless otherwise
agreed by the Company in writing, with notice thereof to the Trustee):
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE
SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF U.S. PERSONS EXCEPT AS
SET FORTH IN THE FOLLOWING SENTENCE. BY ACQUISITION HEREOF, THE HOLDER
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT) ("INSTITUTIONAL ACCREDITED
INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THE SECURITY
EVIDENCED HEREBY IN AN OFFSHORE TRANSACTION; (2) AGREES THAT IT WILL
NOT WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THE SECURITY
EVIDENCED HEREBY RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED
HEREBY OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITY
EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE
UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH
RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER,
FURNISHES TO THE CHASE MANHATTAN BANK, AS TRUSTEE (OR ANY SUCCESSOR
TRUSTEE, AS APPLICABLE), A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER
OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE
OBTAINED FROM SUCH TRUSTEE), (D) OUTSIDE THE UNITED STATES IN
COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES
ACT (IF AVAILABLE) OR (F) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE ACT (AND WHICH CONTINUES TO BE
EFFECTIVE UNDER THE ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE
TIME OF SUCH TRANSFER); AND (3) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN
A TRANSFER PURSUANT TO CLAUSE 2(F) ABOVE) A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. IN CONNECTION
27
WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY WITHIN THREE YEARS
AFTER THE ORIGINAL ISSUANCE OF SUCH SECURITY (OTHER THAN A TRANSFER
PURSUANT TO CLAUSE 2(F) ABOVE), THE HOLDER MUST CHECK THE APPROPRIATE
BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH
TRANSFER AND SUBMIT THIS CERTIFICATE TO THE CHASE MANHATTAN BANK, AS
TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE). IF THE PROPOSED
TRANSFER IS PURSUANT TO CLAUSE 2(C) OR 2(E) ABOVE, THE HOLDER MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE CHASE MANHATTAN BANK, AS TRUSTEE
(OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS THE COMPANY MAY REASONABLY REQUIRE TO
CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM,
OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE
TRANSFER OF THE SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE 2(F) ABOVE
OR THE EXPIRATION OF THREE YEARS FROM THE ORIGINAL ISSUANCE OF THE
SECURITY EVIDENCED HEREBY. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN
TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
Any Security (or security issued in exchange or substitution
thereof) as to which such restrictions on transfer shall have expired in
accordance with their terms or as to which the conditions for removal of the
foregoing legend as set forth therein have been satisfied may, upon
surrender of such Security for exchange to the Security Registrar in
accordance with the provisions of this Section 2.5, be exchanged for a new
Security or Securities, of like tenor and aggregate principal amount, which
shall not bear the restrictive legend required by this Section 2.5(e).
The Depositary shall be a clearing agency registered under the
Exchange Act. The Company initially appoints The Depository Trust Company to
act as Depositary with respect to the Global Securities. Initially, the
Global Securities shall be issued to the Depositary, registered in the name
of Cede & Co., as the nominee of the Depositary, and deposited with the
Trustee as Custodian for Cede & Co.
If at any time the Depositary for a Global Security notifies the
Company that it is unwilling or unable to continue as Depositary for a
Global Security, the Company may appoint a successor Depositary with respect
to such Global Security. If a successor Depositary for a Global Security is
not appointed by the Company within ninety (90) days
28
after the Company receives such notice, the Company will execute, and the
Trustee, upon receipt of an Officers' Certificate for the authentication and
delivery of Securities, will authenticate and deliver, Securities in
certified form, in an aggregate principal amount equal to the principal
amount of the Global Security in exchange for such Global Security and upon
delivery of such Global Security to the Trustee such Global Security shall
be canceled.
Securities in certificated form issued in exchange for all or a
part of a Global Security pursuant to this Section 2.5 shall be registered
in such names and in such authorized denominations as the Depositary,
pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Trustee. Upon execution and authentication,
the Trustee shall deliver such Securities in certified form to the persons
in whose names such Securities in certificated form are so registered.
At such time as all interests in a Global Security have been
redeemed, converted, canceled, repurchased or transferred, such Security in
global form shall be, upon receipt thereof, canceled by the Trustee in
accordance with standing procedures and instructions existing between the
Depositary and the Custodian. At any time to such cancellation, if any
interest in a Global Security is exchanged for Securities in certificated
form, redeemed, converted, canceled, repurchased or transferred to a
transferee who receives Securities in certificated form therefor or any
Security in certificated form is exchanged or transferred for part of a
Global Security, the principal amount of such Global Security shall, in
accordance with the standing procedures and instructions existing between
the Depositary and the Custodian, be appropriately reduced or increased, as
the case may be, and an endorsement shall be made on such Global Security,
by the Trustee or the Custodian, at the direction of the Trustee, to reflect
such reduction or increase.
(f) Until three (3) years after the original issuance date of any
Security, any stock certificate representing Common Stock issued upon
conversion of such Security shall bear a legend in substantially the
following form (unless such Common Stock has been sold pursuant to a
registration statement that has been declared effective under the Securities
Act (and which continues to be effective at the time of such transfer) or
such Common Stock has been issued upon conversion of Securities that have
been transferred pursuant to a registration statement that has been declared
effective under the Securities Act or unless otherwise agreed by the Company
with written notice thereof to the Trustee and any transfer agent for the
Common Stock):
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE
SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS
SET FORTH IN THE FOLLOWING SENTENCE. THE HOLDER HEREOF AGREES THAT
UNTIL THE EXPIRATION OF THREE YEARS AFTER
29
THE ORIGINAL ISSUANCE OF THE SECURITY UPON THE CONVERSION OF WHICH THE
COMMON STOCK EVIDENCED HEREBY WAS ISSUED, (1) IT WILL NOT RESELL OR
OTHERWISE TRANSFER THE COMMON STOCK EVIDENCED HEREBY EXCEPT (A) TO THE
COMPANY OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN COMPLIANCE WITH RULE 144A, (C) INSIDE THE UNITED
STATES TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT) THAT, PRIOR TO
SUCH TRANSFER, FURNISHES TO AMERICAN STOCK TRANSFER & TRUST COMPANY, AS
TRANSFER AGENT (OR ANY SUCCESSOR TRANSFER AGENT, AS APPLICABLE), A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE RESTRICTIONS ON TRANSFER OF THE COMMON STOCK EVIDENCED
HEREBY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM SUCH TRANSFER
AGENT), (D) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 UNDER
THE SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), OR (F)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE
TIME OF SUCH TRANSFER); (2) PRIOR TO ANY SUCH TRANSFER (OTHER THAN A
TRANSFER PURSUANT TO CLAUSE 1(F) ABOVE), IT WILL FURNISH TO AMERICAN
STOCK TRANSFER & TRUST COMPANY, AS TRANSFER AGENT (OR ANY SUCCESSOR
TRANSFER AGENT, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL OPINIONS OR
OTHER INFORMATION AS THE COMPANY MAY REASONABLY REQUIRE TO CONFIRM THAT
SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT; AND (3) IT WILL DELIVER TO EACH PERSON TO WHOM THE
COMMON STOCK EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER
PURSUANT TO A CLAUSE 1(F) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT
OF THE LEGEND. THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE
TRANSFER OF THE COMMON STOCK EVIDENCED HEREBY PURSUANT TO CLAUSE 1(F)
ABOVE OR THE EXPIRATION OF THREE YEARS FROM THE ORIGINAL ISSUANCE OF
THE SECURITY UPON THE CONVERSION OF WHICH THE COMMON STOCK EVIDENCED
HEREBY WAS ISSUED OR UPON THE EARLIER SATISFACTION OF AMERICAN STOCK
30
TRANSFER & TRUST COMPANY, AS TRANSFER AGENT (OR ANY SUCCESSOR
TRANSFER AGENT, AS APPLICABLE), THAT THE SECURITY EVIDENCED
HEREBY HAS BEEN OR IS BEING OFFERED AND SOLD IN COMPLIANCE
WITH RULE 904 UNDER THE SECURITIES ACT. AS USED HEREIN, THE
TERMS "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.
Any such Common Stock as to which such restrictions on transfer
shall have expired in accordance with their terms or as to which the
conditions for removal of the foregoing legend as set forth therein have
been satisfied may, upon surrender of the certificates representing such
shares of Common Stock for exchange in accordance with the procedures of the
transfer agent for the Common Stock, be exchanged for a new certificate or
certificates for a like aggregate number of shares of Common Stock, which
shall not bear the restrictive legend required by this Section 2.5(f).
(g) Any certificate evidencing a Security that has been
transferred to an Affiliate of the Company within three years after the
original issuance date of the Security, as evidenced by a notation on the
Assignment Form for such transfer or in the representation letter delivered
in respect thereof, for so long as such Security is held by such Affiliate,
shall, until three years after the last date on which the Company or any
Affiliate of the Company was an owner of such Security, in each case, bear a
legend in substantially the following form, unless otherwise agreed by the
Company (with written notice thereof to the Trustee):
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED
STATES OR TO, OR THE ACCOUNT TO BENEFIT OF, U.S. PERSONS EXCEPT
AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION
HEREOF, THE HOLDER AGREES (1) THAT IT WILL NOT RESELL OR
OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR THE COMMON
STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITY EXCEPT (A) TO
THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) IN A TRANSACTION
REGISTERED UNDER THE SECURITIES ACT OR (C) PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) AND (2) THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. THIS LEGEND SHALL BE REMOVED UPON THE TRANSFER OF THE
SECURITY EVIDENCED HEREBY OR THE COMMON STOCK ISSUABLE UPON
31
CONVERSION OF SUCH SECURITY PURSUANT TO THE IMMEDIATELY
PRECEDING SENTENCE. IF THE PROPOSED TRANSFER IS PURSUANT TO THE
EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE CHASE MANHATTAN BANK, AS TRUSTEE (OR ANY
SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS THE COMPANY MAY REASONABLY
REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO
AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS USED
HEREIN, THE TERMS "UNITED STATES" AND "U.S. PERSON" HAVE THE
MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
ACT.
Any stock certificate representing Common Stock issued upon
conversion of such Security shall also bear a legend in
substantially the form indicated above, unless otherwise agreed by
the Company (with written notice thereof to the Trustee).
(h) Notwithstanding any provision of Section 2.5 to the
contrary, in the event Rule 144(k) as promulgated under the
Securities Act (or any successor rule) is amended to shorten the
three-year period under Rule 144(k) (or the corresponding period
under any successor rule), from and after receipt by the Trustee of
the Officers' Certificate and Opinion of Counsel provided for this
Section 2.5(h), (i) the references in the first sentence of the
second paragraph of Section 2.5(e) to "three (3) years" and in the
restrictive legend set forth in such paragraph to "THREE YEARS"
shall be deemed for all purposes hereof to be references to such
shorter period, (ii) the references in the first paragraph of
Section 2.5(f) to "three (3) years" and in the restrictive legend
set forth in such paragraph to "THREE YEARS" shall be deemed for all
purposes hereof to be references to such shorter period and (iii)
all corresponding references in the Securities and the restrictive
legends on the Restricted Securities shall be deemed for all
purposes hereof to be references to such shorter period, provided
that such changes shall not become effective if they are otherwise
prohibited by, or would otherwise cause a violation of, the
then-applicable federal securities laws. As soon as practicable
after the Company has knowledge of the effectiveness of any such
amendment to shorten the three-year period under Rule 144(k) (or the
corresponding period under any successor rule), unless such changes
would otherwise be prohibited by, or would otherwise cause a
violation of, the then-applicable securities law, the Company shall
provided to the Trustee an Officers' Certificate and Opinion of
Counsel informing the Trustee of the effectiveness of such amendment
and the effectiveness of the foregoing changes to Sections 2.5(e)
and 2.5(f) and the restrictive legends on the Restricted Securities.
The provisions of this Section 2.5(h) will not be effective until
such time as the Opinion of Counsel and Officer's Certificate have
been received by the Trustee hereunder. This Section
32
2.5(h) shall apply to successive amendments to Rule 144(k) (or any
successor rule 7) shortening the holding period thereunder.
SECTION 2.6 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
deliver 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 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 required by them
to save each of them and any agent of either of them harmless,
then, in the absence of notice to the Company or the Trustee that
such Security has been acquired by a bona fide purchaser, the
Company shall execute and upon request 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 condition set forth in the preceding paragraph.
Upon the issuance of any new Security under this Section,
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 and any other expenses (including the fees and expenses of
the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu
of any destroyed, lost or stolen Security shall constitute an
original additional contractual obligation of the Company, whether
or not the 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 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost
or stolen Securities.
33
SECTION 2.7 Payment of Interest, Interest Rights
Preserved.
Interest on any Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date
shall be paid to the person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest.
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 and the date of the proposed payment, 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. Thereupon the
Trustee shall fix a Special Record Date of the payment of such
Defaulted Interest which 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 shall promptly
notify the Company of such Special Record Date and, 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
(by airmail in the case of any notice sent to an address
outside the United States), to each Holder of Securities at the
address of such Holder 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
34
such exchange, if, after written notice given by the Company to
the Trustee of the proposed payment pursuant to this clause,
such manner of payment shall be deemed reasonable and
practicable by the Trustee.
Subject to the foregoing provisions of this Section, 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.
The person in whose name any Security (or its Predecessor
Security) is registered at the close of business on any Record Date
(including any Security that is converted after the Record Date and
on or before the relevant Interest Payment Date) shall be entitled
to receive the interest payable on such Interest Payment Date
notwithstanding the cancellation of such Security upon any transfer,
exchange or conversion subsequent to the Record Date and on or prior
to such Interest Payment Date; provided that in the case of any
Security, or portion thereof, called for redemption pursuant to
Article 10 on a Redemption Date or repurchased by the Company
pursuant to Article 11 on a repurchase date during the period from
the close of business on the Record Date to the close of business on
the Business Day next preceding the following Interest Payment Date,
interest shall not be paid to the person in whose name the Security,
or portion thereof, is registered on the close of business of such
Record Date, and the Company shall have no obligation to pay
interest on such Security or portion thereof except to the extent
required to be paid upon such redemption or repurchase in accordance
with Article 10 or Article 11.
In the case of any Security which is converted after any
Regular Record Date and on or prior to the next succeeding Interest
Payment Date (other than any Security whose Maturity is prior to
such Interest Payment Date), the Holder of such Security shall be
required to make a payment to the Company in an amount equal to the
interest payable on such Interest Payment Date on the principal
amount of the Security so converted. Interest on the principal
amount of such Security shall be payable on such Interest Payment
Date notwithstanding such conversion, and such interest (whether or
not punctually paid or duly provided for) 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 such Regular
Record Date.
SECTION 2.8 Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or
the Trustee may treat the bearer of the Global Security as the
absolute owner of such Security for the purpose of receiving payment
thereof or on account thereof and for all other purposes whatsoever,
whether or not such Security be overdue, and notwithstanding any
notice of ownership or writing thereon, or any notice of previous
loss or theft or other interest therein. The Company, the Trustee
and any agent of the Company or the Trustee may treat the Person in
whose name any Security is registered as the owner of such Security
for the purpose of
35
receiving payment of principal of and premium, if any, and (subject
to Section 2.7) interest (including Liquidated Damages, if any) on
such Security and for all other purposes whatsoever, whether or not
such Security be overdue, and notwithstanding any notice of
ownership or writing thereon, or any notice of previous loss or
theft or other interest therein.
SECTION 2.9 Cancellation.
All securities surrendered for payment, redemption,
repurchase, conversion, registration of transfer or exchange shall,
if surrendered to any Person other than the Trustee, be delivered to
the Trustee. All Securities so delivered shall be canceled promptly
by the Trustee, and no Securities shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this
Indenture. Upon written instructions of the Company, the Trustee
shall destroy canceled Securities and, after such destruction, shall
deliver a certificate of such destruction to the Company. If the
Company shall acquire any of the Securities, such acquisition shall
not operate as a redemption or satisfaction of the indebtedness
represented by such Securities unless and until the same are
delivered to the Trustee for cancellation.
SECTION 2.10 Computation of Interest.
Interest shall be calculated on the basis of a 360-day
year. Whenever it is necessary to compute an amount of interest in
respect of any Security for a period of less than a full year, such
interest shall be calculated on the basis of a 360-day year
consisting of 12 months of 30 days each and, in the case of an
incomplete month, the number of days elapsed.
SECTION 2.11 Temporary Securities. Pending the preparation
of Securities in certificated form, the Company may execute and the
Trustee or an Authenticating Agent shall, upon written request of
the Company, authenticate and deliver temporary Securities (printed
or lithographed). Temporary Securities shall be issuable in any
authorized denomination, and substantially in the form of the
Securities in certified form but with such omissions, insertions and
variations as may be appropriate for temporary Securities, all as
may be determined by the Company. Every such temporary Security
shall be executed by the Company and authenticated by the Trustee or
the Authenticating Agent upon the same conditions and in
substantially the same manner, and with the same effect, as the
Securities in certificated form. Without unreasonable delay the
Company will execute and deliver to the Trustee or the
Authenticating Agent Securities in certified form (other than in the
case of Securities in global form) and thereupon any or all
temporary Securities (other than any such Securities in global form)
may be surrendered in exchange therefor, at each office or agency
maintained by the Company pursuant to Section 9.2 and the Trustee or
the Authenticating Agent shall authenticate and deliver in exchange
for such temporary Securities an equal aggregate principal amount of
Securities in certified form. Such exchange shall be made by the
Company at its own expense and without any charge therefor. Until so
exchanged, the
36
temporary Securities shall in all respects be entitled to the same
benefits and subject to the same limitations under this Indenture as
Securities in certificated form authenticated and delivered
hereunder.
ARTICLE 3
SATISFACTION AND DISCHARGE
SECTION 3.1 Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except
as to any surviving rights of conversion, registration of transfer
or exchange or replacement of Securities herein expressly provided
for), and the Trustee, on demand of and at the expense of the
Company, shall execute proper instruments 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 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
37
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
and premium, if any, and interest (including Liquidated
Damages, if any) 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 5.7 shall survive and, if money shall have been deposited
with the Trustee pursuant to clause (1)(B) of this Section, the
obligations of the Trustee under Section 3.2 and the last paragraph
of Section 9.3 shall survive. Funds held in trust pursuant to this
Section are not subject to the provisions of Article 13.
SECTION 3.2 Application of Trust Money.
Subject to the provisions of the last paragraph of Section
9.3, all money deposited with the Trustee pursuant to Section 3.1
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) as the Trustee may determine, to the
Persons entitled thereto, of the principal and premium, if any, and
interest (including Liquidated Damages, if any) for whose payment
such money has been deposited with the Trustee.
All moneys deposited with the Trustee pursuant to Section
3.1 (and held by it or any Paying Agent) for the payment of
Securities subsequently converted shall be returned to the Company
upon Company Request.
38
ARTICLE 4
REMEDIES
SECTION 4.1 Events of Default.
"Event of Default", where 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 13
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) there shall be a failure by the Company to pay when
due the principal of or premium, if any, on any of the
Securities at the Stated Maturity, upon redemption or exercise
of a Repurchase Right or otherwise, whether or not such payment
is prohibited by Article 13 of this Indenture; or
(2) there shall be a failure by the Company to pay an
installment of interest (including Liquidated Damages, if any)
on any of the Securities for 30 days after the date when due,
whether or not such payment is prohibited by Article 13 of this
Indenture; or
(3) the Company shall fail to perform or observe any other
term, covenant or agreement contained in the Securities or this
Indenture for a period of 60 days after written notice of such
failure, requiring the Company to remedy the same, shall have
been given to the Company by the Trustee or to the Company and
the Trustee by the Holders of at least 25% in principal amount
of the Outstanding Securities; or
(4) if any default shall have occurred under any
agreements, indentures or instruments under which the Company
has outstanding Indebtedness in excess of U.S. $25,000,000 in
the aggregate (but excluding for purposes of this clause (4)
any amounts owing under reimbursement or similar obligations to
banks, sureties or other entities which have issued letters of
credit, surety bonds, performance bonds or other guarantees
relating to the performance by the Company or its subsidiaries
of contractual obligations to customers, to the extent any
demands made under any such reimbursement or similar obligation
relates to a draw under the related letter of credit or other
instrument which draw is being contested in good faith through
appropriate proceedings) and, if not already matured in
accordance with its terms, such Indebtedness (as set forth in
this clause (4)) shall have been accelerated, and such
acceleration shall not have been rescinded or annulled within
30 days after notice thereof shall have been given to the
Company by the Trustee or to the Company and the Trustee by the
holders of at least 25% in aggregate principal amount of
Outstanding Securities, provided, that if, prior to the entry
of judgment in favor of
39
the Trustee, such default under such agreement, indenture or
instrument shall be remedied or cured by the Company, or waived
by the holders of such Indebtedness (as set forth in this
clause (4)), then the Event of Default under this Indenture
shall be deemed likewise to have been remedied, cured or
waived; 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 United States 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 United States 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 United States 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 the Company to the entry of a
decree or order for relief in respect of the Company in an
involuntary case or proceeding under any applicable United
States federal or state bankruptcy, insolvency, reorganization
or other similar law or to the commencement of any bankruptcy
or insolvency case or proceeding against the Company, or the
filing by the Company of a petition or answer or consent
seeking reorganization or relief under any applicable United
States federal or state law, or the consent by the Company to
the filing of such petition or to the appointment of or the
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 the Company of an assignment for the benefit of
creditors, or the admission by the Company in writing of its
inability to pay its debts generally as they become due, or the
taking of corporate action by the Company expressly in
furtherance of any such action.
SECTION 4.2 Acceleration of Maturity; Rescission and
Annulment.
If an Event of Default specified in Section 4.1(5) or
4.1(6) occurs and is continuing, then automatically the principal of
all the Securities and the interest thereon shall become immediately
due and payable. If any other Event of Default occurs and is
continuing, then and in every such case the Trustee or the Holders
of not less than 25% in principal amount of the Outstanding
Securities may declare the Securities to be due and payable
immediately at their principal amount together with accrued
interest, by a notice in
40
writing to the Company (and to the Trustee if given by the Holders),
and upon any such declaration such principal amount and accrued
interest shall become immediately due and payable.
At any time after an acceleration and before a judgment or
decree for payment of the money due has been obtained by the Trustee
as hereinafter in this Article provided, the Holders of a majority
in principal amount of the Outstanding Securities (or such lesser
amount as shall have acted at a meeting pursuant to the provisions
of this Indenture), by written notice to the Company and the
Trustee, may rescind and annul such acceleration and its
consequences if:
(1) the Company has paid or deposited with the Trustee a
sum sufficient to pay
(A) all overdue interest (including Liquidated
Damages, if any) on all Securities,
(B) the principal of and premium, if any, on any
Securities which has become due otherwise than by such
declaration of acceleration and interest thereon at the
rate borne by the Securities,
(C) to the extent that payment of such interest is
lawful, interest upon overdue interest (including
Liquidated Damages, if any) at the rate borne by the
Securities, 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 non-payment of
the principal of Securities which have become due solely by
such acceleration, have been cured or waived as provided in
Section 4.13;
provided, however, that in the event such declaration of
acceleration has been made based on the existence of an Event of
Default under Section 4.1(4) and such Event of Default has, pursuant
to the proviso to such Section 4.1(4), been remedied, cured or
waived, then without any further action by the Holders such
declaration of acceleration shall be rescinded automatically and the
consequences of such declaration shall be annulled.
No such rescission or annulment shall affect any
subsequent default or impair any right consequent thereon.
41
SECTION 4.3 Collection of Indebtedness and Suits for
Enforcement by the Trustee.
The Company covenants that if
(1) default is made in the payment of any interest
(including Liquidated Damages, if any) on any Security when
such interest (including Liquidated Damages, if any) becomes
due and payable and such default continues for a period of 30
days, or
(2) default is made in the payment of the principal of or
premium, if any, on any Security at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then due
and payable (as expressed therein or as a result of any acceleration
effected pursuant to Section 4.2) on such Securities for principal
and premium, if any, and interest (including Liquidated Damages, if
any) and, to the extent that payment of such interest shall be
legally enforceable, interest on any overdue principal and premium,
if any, and on any overdue interest (including Liquidated Damages,
if any), at the rate borne by the Securities, and, in addition
thereto, such further amount as shall be sufficient to cover the
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 and collect the moneys adjudged or decreed to be
payable in the manner provided by law out of the property of the
Company, 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 4.4 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
the property of the Company or its creditors, the Trustee
(irrespective of whether the principal of the Securities shall then
be due and payable
42
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 and premium, if any, and interest (including
Liquidated Damages, if any) owing and unpaid in respect of the
Securities and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents
and counsel) and of the Holders of Securities allowed in such
judicial proceeding, and
(2) to collect and receive any moneys or other property
payable or deliverable on any such claim and to distribute the
same;
and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial
proceedings 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.
SECTION 4.5 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 4.6 Application of Money Collected.
Subject to Article 13, any money collected by the Trustee
pursuant to this Article 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 or premium, if
any, or
43
interest (including Liquidated Damages, if any), 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;
SECOND: To the payment of the amounts then due and unpaid
for principal of and premium, if any, and interest (including
Liquidated Damages, if any) on the Securities and coupons 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 and
premium, if any, and interest (including Liquidated Damages, if
any), respectively; and
THIRD: Any remaining amounts shall be repaid to the
Company.
SECTION 4.7 Limitation on Suit.
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
indemnity satisfactory to it 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 (or such amount as shall have acted at a meeting
pursuant to the provisions of this Indenture);
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
44
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 4.8 Unconditional Right of Holders to Receive
Principal, Premium and Interest and To Convert.
Notwithstanding any other provision in this Indenture, the
Holder of any Security (other than the Temporary Global Security)
shall have the right, which is absolute and unconditional, to
receive payment of the principal of and premium, if any, and
(subject to Section 2.7) interest (including Liquidated Damages, if
any) on such Security on the Stated Maturity expressed in such
Security (or, in the case of redemption or exercise of a Repurchase
Right, on the Redemption Date) and to convert such Security in
accordance with Article 12, 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 4.9 Restoration of Rights and Remedies.
If the Trustee or any Holder of a Security has instituted
any proceeding to enforce any right or remedy under this Indenture
and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such
Holder, then and in every such case, subject to any determination in
such proceeding, the Company, the Trustee and the Holders of
Securities shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of
the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
SECTION 4.10 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 2.6, 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 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 4.11 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.
45
Every right and remedy given by this Article 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
by the Holders of Securities, as the case may be.
SECTION 4.12 Control by Holders of Securities.
The Holders of a majority in principal amount of the
Outstanding Securities (or such lesser amount as shall have acted as
a meeting pursuant to the provisions of this Indenture) 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 conflict with any rule of
law or with this Indenture or expose the Trustee to personal
liability, or be unduly prejudicial to the Holders not joining
therein,
(2) the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction.
SECTION 4.13 Waiver of Past Default.
The Holders, either (a) through the written consent of not
less than a majority in principal amount of the Outstanding
Securities, or (b) by the adoption of a resolution, at a meeting of
Holders of the Outstanding Securities at which a quorum is present,
by the Holders of at least a majority in principal amount of the
Outstanding Securities represented at such meeting, may on behalf of
the Holders of all the Securities waive any past default hereunder
and its consequences, except a default (1) in the payment of the
principal of or premium, if any, or interest (including Liquidated
Damages, if any) on any Security or (2) in respect of a covenant or
provision hereof which under Article 7 cannot be modified or amended
without the consent of the Holders 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 4.14 Undertaking for Costs.
All parties to this Indenture agree, and each Holder of
any Security by such Holder's 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
46
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 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 or any Security
for the enforcement of the payment of the principal of or premium,
if any, or interest (including Liquidated Damages, if any) on any
Security on or after the Stated Maturity expressed in such Security
(or, in the case of redemption or exercise of a Repurchase Right, on
or after the Redemption Date) or for the enforcement of the right to
convert any Security in accordance with Article 12.
SECTION 4.15 Waiver of Stay 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 to take the benefit or advantage of, any
stay 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 the execution
of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law had
been enacted.
ARTICLE 5
THE TRUSTEE
SECTION 5.1 Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture,
and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the
case of any such certificates or opinions which by any
provision hereof are specifically required to be furnished to
the Trustee, the Trustee shall be under a duty to examine the
same to determine whether or not they conform to the
requirements to this Indenture.
47
(b) In case an Event of Default actually known to a
Responsible Officer of the Trustee has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own grossly negligent
action, its own grossly negligent failure to act, or its own wilful
misconduct, except that
(1) this paragraph (c) shall not be construed to limit the
effect of paragraph (a) of this Section;
(2) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it
shall be proved that the Trustee was grossly 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 (or such lesser
amount as shall have acted at a meeting pursuant to the
provisions of this Indenture) relating to the time, method and
place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred upon
the Trustee, under this Indenture; and
(4) no provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers,
if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the
liability of or affording protection to the Trustee shall be subject
to the provisions of this Section.
SECTION 5.2 Notice of Defaults.
Within 90 days after the occurrence of any default
hereunder of which the Trustee has received written notice, the
Trustee shall give notice to Holders pursuant to Section 1.5 hereof,
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 or premium, if any, or interest (including Liquidated
Damages, if any), or in the payment of any redemption or repurchase
obligation on any Security, the Trustee shall be protected in
withholding such
48
notice if and so long as 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 4.1(3), no such
notice to Holders 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 5.3 Certain Rights of Trustee.
Subject to the provisions of Section 5.1:
(1) the Trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, Officers'
Certificate, Company Request, Company Order, 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 may
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 and the advice of
such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in
reliance hereon;
(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 security or indemnity satisfactory to it
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, in its
49
discretion, 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 Trustee shall not be deemed to have notice or
actual knowledge of any Event of Default (other than an Event
of Default described in Section 4.1(1) or (2)) unless written
notice thereof is received by a Responsible Officer of the
Trustee at its Corporate Trust Office, including, from Holders
of not less than 25% in principal amount of the Outstanding
Securities;
(9) the Trustee shall not be liable for any action taken
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 this Indenture; and
(10) the rights, protections and immunities afforded to
the Trustee hereunder shall apply with equal force and effect
to any Paying Agent, Authenticating Agent, Conversion Agent or
Security Registrar acting hereunder.
SECTION 5.4 Not Responsible for Recitals or Issuance of
Securities.
The recitals contained herein and in the Securities
(except the Trustee's and Authenticating Agent'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 or of the Securities. The Trustee shall not be
accountable for the use or application by the Company of Securities
or the proceeds thereof.
SECTION 5.5 May Hold Securities, Act as Trustee Under
Other Indentures.
The Trustee, any Paying Agent, any Transfer Agent, any
Conversion Agent, any Security Registrar 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, Paying Agent, Transfer Agent, Conversion Agent, Security
Registrar or such other agent.
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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.
SECTION 5.6 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 expressly agreed with
the Company.
SECTION 5.7 Compensation and Indemnification of Trustee
and Its Prior Claims.
The Company covenants and agrees to pay to the Trustee
from time to time, and the Trustee shall be entitled to, reasonable
compensation (which shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust) and the
Company covenants and agrees to pay or reimburse the Trustee upon
its request for all reasonable expenses, disbursements and advances
incurred or made by or on behalf of it in accordance with any of the
provisions of this Indenture (including the reasonable compensation
and the expenses and disbursements of its counsel and of all agents
and other persons not regularly in its employ), except to the extent
that any such expense, disbursement or advance is due to its gross
negligence or bad faith. When the Trustee incurs expenses or renders
services in connection with an Event of Default specified in Section
4.1, the expenses (including the reasonable charges and expenses of
its counsel) and the compensation for the services are intended to
constitute expenses of administration under any bankruptcy law. The
Company also covenants to indemnify the Trustee and its officers,
directors, employees and agents for, and to hold such Persons
harmless against, any loss, liability or expense incurred by them,
arising out of or in connection with the acceptance or
administration of this Indenture or the trusts hereunder or the
performance of their duties hereunder, including the costs and
expenses of defending themselves against or investigating any claim
of liability in the premises, except to the extent that any such
loss, liability or expense was due to the gross negligence or bad
faith of such Persons. The obligations of the Company under this
Section 5.7 to compensate and indemnify the Trustee and its
officers, directors, employees and agents and to pay or reimburse
such Persons for expenses, disbursements and advances shall
constitute additional indebtedness hereunder and shall survive the
satisfaction and discharge of this Indenture or the earlier
resignation or removal of the Trustee. Such additional indebtedness
shall be a senior claim to that of the Securities upon all property
and funds held or collected by the Trustee as such, except funds
held in trust for the benefit of the Holders of particular
Securities, and the Securities are hereby subordinated to such
senior claim. "Trustee" for purposes of this Section 5.7 shall
include any predecessor Trustee, but the gross negligence or bad
faith of any Trustee shall not affect the indemnification of any
other Trustee.
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SECTION 5.8 Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which
shall 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 exercise corporate trust
powers, having (together with any Person directly or indirectly
controlling the Trustee) a combined capital and surplus of at least
U.S. $50,000,000, subject to supervision or examination by federal
or state authority. If such corporation publishes reports of
conditions 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.
SECTION 5.9 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 5.10.
(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 5.10 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 (or such lesser amount as shall have acted at a meeting
pursuant to the provisions of this Indenture), delivered to the
Trustee and the Company.
(d) If at any time:
(1) the Trustee shall cease to be eligible under Section
5.8 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,
52
then, in any such case (i) the Company by a Board Resolution
may remove the Trustee, or (ii) subject to Section 4.14, any
Holder of a Security who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment
of a successor Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of
Trustee for any cause, the Company, by a Board Resolution, shall
promptly appoint a successor Trustee and shall comply with the
applicable requirements of Section 5.10. 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 (or such lesser amount as shall have acted at a meeting
pursuant to the provisions of this Indenture) 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 5.10, 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 Section 5.10, 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 the Holders of Securities in the manner provided in
Section 1.5. Each notice shall include the name of the successor
Trustee and the address of its Corporate Trust Office.
SECTION 5.10 Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and 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 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.
53
No successor Trustee shall accept its appointment unless
at the time of such acceptance such successor Trustee shall be
eligible under this Article.
The fees, charges and expenses of the retiring Trustee
shall be paid upon the appointment of a successor Trustee hereunder.
The retiring Trustee shall not be liable for any acts or omissions
of a successor hereunder.
SECTION 5.11 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 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 5.12 Authenticating Agent.
The Company may appoint an authenticating agent or agents
reasonably acceptable to the Trustee with respect to the Securities
which shall be authorized to act on behalf of the Trustee to
authenticate Securities issued upon exchange, registration of
transfer, partial redemption thereof or substitution pursuant to
this Indenture. Securities so authenticated 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 herein 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 at all times
be a bank or trust company authorized by law to act as an
authenticating agent, having a combined capital and surplus of not
less than U.S. $50,000,000 and subject to supervision or examination
by a duly constituted banking authority. If such authenticating
agent 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 5.12, the combined
capital and surplus of such authenticating agent 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 an authenticating
agent shall cease to be eligible in accordance with the provisions
of this
54
Section 5.12, such authenticating agent shall resign immediately in
the manner and with the effect specified in this Section 5.12.
The Company hereby appoints The Chase Manhattan Bank as
Authenticating Agent.
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 5.12, 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
Company may at any time terminate the agency of an authenticating
agent by giving written notice thereof to such authenticating agent
and to the Trustee. 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 5.12, the Company may appoint a successor
authenticating agent which shall be acceptable to the Trustee. 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 5.12.
The Company agrees to pay to each authorizing agent from
time to time reasonable compensation for its services under this
Section 5.12.
If an authenticating agent is appointed with respect to
the Securities pursuant to this Section 5.12, the Securities may
have been endorsed thereon, in addition to or in lieu of the
Trustee's certification of authentication, an alternate certificate
of authentication in the following form:
55
This is one of the Securities referred to in the
within-mentioned Indenture:
THE CHASE MANHATTAN BANK
as Trustee
By [Authenticating Agent], as
Authenticating Agent
By-----------------------------
Authorized Signatory
ARTICLE 6
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 6.1 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 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 its properties and assets substantially
as an entirety to the Company, unless:
(1) in the event that 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 organized and validly existing under the laws of
the United States of America, any State thereof or the District
of Columbia and, if the entity surviving such transaction or
transferee entity is not the Company, then such surviving or
transferee entity 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 and premium, if any and interest (including
Liquidated Damages, if any), on all the Securities and the
performance of every covenant of this Indenture on the party of
the Company to be performed or observed and shall have provided
for conversion rights in accordance with Section 12.11;
56
(2) at the time of consummation of such transaction, no
Event of Default, and no event which, after notice or lapse of
time or both, would become an Event of Default, shall have
happened and be continuing; and
(3) the Company shall have 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.
SECTION 6.2 Successor Corporation Substituted.
Upon any consolidation or merger by the Company with or
into any other corporation or any conveyance, transfer or lease of
the properties and assets of the Company substantially as an
entirety to any Person, in accordance with Section 6.1, the
successor corporation formed by such consolidation or into 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 corporation had been named as the
Company herein, and thereafter, except in the case of a lease to
another Person, the predecessor corporation shall be relieved of all
obligations and covenants under this Indenture and the Securities.
ARTICLE 7
SUPPLEMENTAL INDENTURES
SECTION 7.1 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 corporation to
the Company and the assumption by any such successor of the
covenants of the Company herein and in the Securities; 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
57
(3) to modify the restrictive legend set forth on the face
of the form of Security set forth in Exhibit A hereto or modify
the form of certificates set forth in Exhibit A hereto;
provided, however, that any such modification shall not
adversely affect the interest of the Holders of the Securities
in any material respect; or
(4) to make provision with respect to the conversion
rights of Holders of Securities pursuant to Section 12.11; or
(5) to make provision for the establishment of a
book-entry system, in which Holders would have the option to
participate, for the clearance and settlement of transactions
in Securities originally issued in certificated form; or
(6) to reduce the Conversion Price; provided, that such
reduction in the Conversion Price shall not adversely affect
the interest of the Holders of Securities (after taking into
account tax and other consequences of such reduction) in any
material respect; or
(7) to qualify this Indenture under the Trust Indenture
Act of 1939, as amended; or
(8) 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 which shall not be inconsistent
with the provisions of this Indenture, provided, such action
pursuant to this clause (8) shall not adversely affect the
interest of the Holders of Securities in any material respect.
SECTION 7.2 Supplemental Indentures with Consent of
Holders of Securities.
With either (a) the consent of the Holders of not less
than a majority in principal amount of the Outstanding Securities,
by the Act of said Holders delivered to the Company and the Trustee,
or (b) by the adoption of a resolution, at a meeting of Holders of
the Outstanding Securities at which a quorum is present, by the
Holders of a majority in principal amount of the Outstanding
Securities represented at such meeting, the Company, when authorized
by a Board Resolution, and the Trustee may enter into an indenture
or indentures supplemental hereto for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the
rights of the Holders of the Securities under this Indenture;
provided, however, that no such supplemental indenture shall,
without the consent of the Holder of each Outstanding Security
affected thereby,
(1) change the Stated Maturity of the principal of, or any
installment of interest (including Liquidated Damages, if any)
on, any Security, or reduce the
58
principal amount thereof or the rate of interest thereon or any
premium, if any, payable upon the redemption thereof or the
amount payable upon the exercise of a Repurchase Right with
respect thereto, or change the coin or currency in which any
Security or premium, if any, or the interest thereon is
payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity
thereof or, except as permitted by Section 12.11, adversely
affect the Repurchase Right or the right to convert any
Security as provided in Article 12, or change the subordination
provisions of the Securities in a manner adverse to the Holders
of Securities, or
(2) reduce the requirements of Section 8.4 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 provided for in this
Indenture, or
(3) change the obligation of the Company to maintain an
office or agency in The City of New York pursuant to Section
9.2, or
(4) modify any of the provisions of this Section, Section
4.13 or Section 1.10, 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.
It shall not be necessary for any Act of Holders of
Securities under this Section to approve the particular form of any
proposal supplemental indenture, but it shall be sufficient if such
Act shall approve the substance thereof.
SECTION 7.3 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 Section 5.1)
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 an Officer's
Certificate stating that all conditions precedent to the execution
of such supplemental indenture have been fulfilled. 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 7.4 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
59
form a part of this Indenture for all purposes; and every Holder of
Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
SECTION 7.5 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 7.6 Notice of Supplemental Indentures.
Promptly after the execution by the Company and the
Trustee of any supplemental indenture pursuant to the provisions of
Section 7.1 or 7.2, the Company shall give notice, setting forth in
general terms the substance of such supplemental indenture, in the
manner provided in Section 1.5. 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.
ARTICLE 8
MEETING OF HOLDERS OF SECURITIES
SECTION 8.1 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 8.2 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 8.1, to be held
at such time and at such place in The City of New York. 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 1.5, not less than 21 nor more than 180 days prior to the
date fixed for the meeting.
60
(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 8.1, 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 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 8.3 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 8.4 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 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 of not
less than 10 days as determined by the chairman of the meeting prior
to the adjournment of such adjourned meeting. Notice of the
reconvening of any adjourned meeting shall be given as provided in
Section 8.2(a), except that such notice need be given only once and
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.
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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 7.2) shall be
effectively passed and decided if passed or decided by the Persons
entitled to vote not less than a majority in principal amount of
Outstanding Securities represented and voting 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.
SECTION 8.5 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 1.3 and the appointment of any proxy shall be proved in the
manner specified in Section 1.3. Such regulations may provide that
written instruments appointing proxies, regular on their face, may
be presumed valid and genuine without the proof specified in Section
1.3 or other proof.
(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 8.2(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 8.2 at which a quorum is present may be
adjourned from time to time by Persons entitled to
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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 8.6 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 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 8.2 and, if applicable, Section 8.4. 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 9
COVENANTS
SECTION 9.1 Payment of Principal, Premium and Interest.
The Company will duly and punctually pay the principal of
and premium, if any and interest (including Liquidated Damages, if
any) in respect of 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 as directed by the Trustee, one
Business Day prior to the Stated Maturity of any Security or
installment of interest, all payments so due.
SECTION 9.2 Maintenance of Offices or Agencies.
The Company hereby appoints the Corporate Trust Office of
the Trustee as its agent in 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.
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The Company may at any time and from time to time vary or
terminate the appointment of any such agent or appoint any
additional agents for any or all of such purposes; provided,
however, that until all of the Securities have been delivered to the
Trustee for cancellation, or moneys sufficient to pay the principal
of and premium, if any, and interest (including Liquidated Damages,
if any) on the Securities have been made available for payment and
either paid or returned to the Company pursuant to the provisions of
Section 9.3, the Company will maintain in The City of New York, an
office or agency where Securities may be presented or surrendered
for payment, where Securities may be surrendered for registration of
transfer or exchange, 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 will give prompt written notice to the Trustee, and notice
to the Holders in accordance with Section 1.5, 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 in The City of New York, 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 and
Securities may be surrendered for conversion to the Corporate Trust
Office of the Trustee.
SECTION 9.3 Money for Security Payments To Be Held in
Trust.
If the Company shall act as a Paying Agent, it will, on or
before each due date of the principal of and premium, if any, or
interest (including Liquidated Damages, if any) 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 and
premium, if any, or interest (including Liquidated Damages, if any)
so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and the Company will
promptly notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents,
it will, one Business Day prior to each due date of the principal of
and premium, if any, or interest (including Liquidated Damages, if
any) on any Securities (or, if applicable, cash in lieu of
conversion of any Security), deposit with a Paying Agent a sum
sufficient to pay the principal and premium, if any, or interest
(including Liquidated Damages, if any) so becoming due, such sum to
be held in trust for the benefit of the Persons entitled to such
principal, premium, if any, or interest (including Liquidated
Damages, if any), and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of any failure so to act.
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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 and premium, if any, or interest (including
Liquidated Damages, if any) on Securities in trust 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
in the making of any payment of principal and premium, if any,
or interest (including Liquidated Damages, if any); 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 in trust 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 and premium, if any, or interest on any Security and
remaining unclaimed for two years after such principal and premium,
if any, or interest (including Liquidated Damages, if any) and
redemption or repurchase payments have become due and payable shall
be paid to the Company on Company Request, subject to applicable
abandoned property and escheat laws, 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 (i) 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 or mailed notice as provided in
Section 1.5, except that such notice need be given only once, (ii)
such money remains unclaimed and (iii) after a date specified in
such notice, 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.
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SECTION 9.4 Corporate Existence.
Subject to Article 6, the Company will do or cause to be
done all things necessary to preserve and keep in full force and
effect its corporate existence, rights (charter and statutory) and
franchises; provided, however, that the Company shall not be
required to preserve any such right or franchise if the Company
determines that the preservation thereof is no longer desirable in
the conduct of the business of the Company and that the loss thereof
is not disadvantageous in any material respect to the Holders.
SECTION 9.5 Maintenance of Properties.
The Company will, and will cause each Significant
Subsidiary to, maintain and keep its properties and every part
thereof in such repair, working order and condition, and make or
cause to be made all such needful and proper repairs, renewals and
replacements thereto, as in the judgment of the Company are
necessary in the interests of the Company; provided, however, that
nothing in this Section shall prevent the Company or any Significant
Subsidiary from selling, abandoning or otherwise disposing of any of
their respective properties or discontinuing a part of their
respective businesses from time to time if, in the judgment of the
Company, such sale, abandonment, disposition or discontinuance is
advisable and does not materially adversely affect the interests or
business of the Company or any of its Subsidiaries.
SECTION 9.6 Payment of Taxes and Other Claims.
The Company will, and will cause each Significant
Subsidiary to, promptly pay and discharge or cause to be paid and
discharged all taxes, assessments and governmental charges or levies
lawfully imposed upon it or upon its income or profits or upon any
of its property, real or personal, or upon any part thereof, as well
as all claims for labor, materials and supplies which, if unpaid,
might by law become a lien or charge upon its property; provided,
however, that neither the Company nor any Significant Subsidiary
shall be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge, levy, or claim if the
amount, applicability or validity thereof shall currently be
contested in good faith by appropriate proceedings and if the
Company or such Significant Subsidiary, as the case may be, shall
have set aside on its books reserves deemed by it adequate with
respect thereto.
SECTION 9.7 Statement by Officers as to Default.
The Company will deliver to the Trustee, on or before
October 1 in each year 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
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in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge. In the event an officer of
the Company comes to actually know of such a default, regardless of
the date the Company will deliver an Officers' Certificate to the
Trustee specifying such default and the nature and status thereof.
SECTION 9.8 Waiver of Certain Covenants.
The Company may omit in any particular instance to comply
with any term, provision or condition set forth in Sections 9.3 to
9.5, inclusive, if before the time for such compliance the Holders
of at least a majority in principal amount of the Outstanding
Securities (or such lesser amount as shall have acted at a meeting
pursuant to the provisions of this Indenture) shall, by Act of such
Holders, either waive such compliance in such instance or generally
waive compliance with such term, provision or condition, but no
waiver shall extend to or affect such term, provision 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 in respect of any such term, provision or
condition shall remain in full force and effect.
SECTION 9.9 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
Security, the Company will promptly furnish or cause to be furnished
Rule 144A Information to such Holder or to a prospective purchaser
of such Security designated by such Holder, as the case may be, in
order to permit compliance by such Holder with Rule 144A under the
Securities Act in connection with the resale of such Security by
such Holder; 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 three years from the date such
Security (or any predecessor Security) was acquired from the
Company; and provided further, however, that the Company shall not
be required to furnish such information at any time to a prospective
purchaser located outside the United States who is not a "U.S.
person" within the meaning of Regulation S under the Securities Act
if such Security may then be sold to such prospective purchaser in
accordance with Rule 903 or Rule 904 of Regulation S 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).
SECTION 9.10 Resale of Certain Securities.
During the period of three years after the Closing Date,
the Company shall not, and shall not permit any of its "affiliates"
(as defined under Rule 144 under the Securities Act) to, resell any
Securities, or shares of Common Stock issuable upon conversion of
the Securities, which constitute "restricted securities" under Rule
144, that are acquired by any of them within the United States or to
U.S. persons (as defined in
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Regulation S) except pursuant to an effective registration statement
under the Securities Act or an applicable exemption therefrom. The
Trustee shall have no responsibility or liability in respect of the
Company's performance of its agreement in the preceding sentence.
ARTICLE 10
REDEMPTION OF SECURITIES
SECTION 10.1 Right of Redemption.
The Company may, at its option, redeem all, or from time
to time, any part of the Securities on any date prior to maturity,
upon notice as set forth in Section 10.3, at the Redemption Prices
specified in the form of Security set forth in Exhibit A hereto,
together with accrued interest to the Redemption Date; provided,
however, that prior to October 12, 1999, the Company may not redeem
the Securities.
SECTION 10.2 Applicability of Article.
Redemption of Securities at the election of the Company or
otherwise as permitted or required by any provision of the
Securities or this Indenture, shall be made in accordance with such
provision and this Article.
SECTION 10.3 Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall
be evidenced by a Board Resolution. In case of any redemption at the
election of the Company of all 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 of such Redemption Date. In case of any
redemption at the election of the Company of less than all the
Securities, the Company shall, at least 75 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall
be satisfactory to the Trustee), notify the Trustee of such
Redemption Date and of the principal amount of Securities to be
redeemed.
SECTION 10.4 Selection by Trustee of Securities To Be
Redeemed.
If less than all the Securities are to be redeemed, the
particular Securities to be redeemed shall be selected not more than
75 days prior to the Redemption Date by the Trustee, from the
Outstanding Securities not previously called for redemption, by such
method as the Trustee may deem fair and appropriate. Partial
redemption must be in an amount not less than U.S. $1,000,000
principal amount of Securities. Such method of selection may provide
for the selection for redemption of portions (equal to U.S. $1,000
or
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any integral multiple thereof) of the principal amount of Securities
of a denomination larger than U.S. $1,000.
If any Security selected for partial redemption is
converted in part before termination of the conversion right with
respect to the portion of the Security so selected, the converted
portion of such Security shall be deemed to be the portion selected
for redemption (provided, however, that the Holder of such Security
so converted and deemed redeemed shall not be entitled to any
additional interest payment as a result of such deemed redemption
than such Holder would have otherwise been entitled to receive upon
conversion of such Security). 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 in registered form
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 10.5 Notice of Redemption.
Notice of redemption shall be given in the manner provided
in Section 1.5 to the Holders of Securities to be redeemed. Such
notice shall be given not less than 30 nor more than 60 days prior
to the Redemption Date.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price, and accrued interest, if any,
(3) if less than all the Outstanding Securities are to be
redeemed, the aggregate principal amount of Securities to be
redeemed 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,
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(5) the Conversion Price, the date on which the right to
convert the principal of the Securities to be redeemed will
terminate and the places where such Securities may be
surrendered for conversation,
(6) the place or places that the certificate required by
Section 10.7 and Section 2.2 shall be delivered, and the form
of such certificate, and
(7) the place or places where such Securities are to be
surrendered for payment of the Redemption Price and accrued
interest, if any.
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 2.5, and the second
notice shall specify the serial numbers of Securities 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 request, by the Trustee in the name of and at the expense
of the Company.
SECTION 10.6 Deposit of Redemption Price.
One Business Day prior to any Redemption Date, the Company
shall deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold in
trust as provided in Section 9.3) an amount of money 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 with a Paying Agent 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 2.7) be paid to the Company on Company Request
or, if then held by the Company, shall be discharged from such
trust.
SECTION 10.7 Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the
Securities so to be redeemed shall, on the Redemption Date, become
due and payable at the Redemption Price therein specified and from
and after such date (unless the Company shall default in the payment
of the Redemption Price and accrued interest) such Securities shall
cease to bear interest. Upon surrender of any such Security for
redemption in accordance with said notice,
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such Security shall be paid by the Company at the Redemption Price
together with accrued interest to the Redemption Date; provided,
however, the 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 2.7.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal and premium, if
any, shall, until paid, bear interest from the Redemption Date at
the rate prescribed therefor in the Security.
Upon presentation and surrender of any Security which is
to be purchased in part only, upon its purchase, the Company shall
execute and the Trustee shall authenticate and deliver to the Holder
thereof, at the expense of the Company, a new Security or Securities
in authorized denominations in aggregate principal amount equal to
the portion of the Security not purchased.
SECTION 10.8 Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be
surrendered at an office or agency of the Company designated for
that purpose pursuant to Section 9.2 (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of
transfer in form satisfactory to the Company and the Trustee duly
executed by, the Holder thereof or the Holder's attorney duly
authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities of any
authorized denomination as requested by such Holder in aggregate
principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.
ARTICLE 11
REPURCHASE UPON A DESIGNATED EVENT
SECTION 11.1 Repurchase Right.
(a) If, at any time prior to October 1, 2006 there shall
occur a Designated Event, then each Holder shall have the right (the
"Repurchase Right"), at such Holder's option, but subject to the
provisions of Section 11.2, to require the Company to repurchase all
of such Holder's Securities, or any portion thereof (in principal
amounts of $1,000 or integral multiples thereof), on the repurchase
date fixed by the Company that is not less than 30 days nor more
than 45 days after the date of the Company Notice (as defined in
Section 11.2 below) of such Designated Event (or, if such 45th day
is not a Business Day, the next succeeding Business Day). The
repurchase price shall be equal to 100% of the principal
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amount of Securities, together with accrued interest, if any, to,
but excluding, the repurchase date (the "Repurchase Price");
provided that if such repurchase date is April 1 or October 1, then
the interest payable on such date shall be paid to the holder of
record of the Securities on the next preceding March 15 or September
15, respectively. No Securities may be repurchased at the option of
Holders upon a Designated Event if there has occurred and is
continuing an Event of Default, other than a default in the payment
of the Repurchase Price with respect to such Securities on the
repurchase date. 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 11.2, by delivery of shares of
Common Stock having a fair market value equal to the Repurchase
Price as described in Section 11.2(a). Whenever in this Indenture
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 13, such reference shall be deemed to
include reference to the Repurchase Price only if the Repurchase
Price is payable in cash.
SECTION 11.2 Conditions to the Company's Election to Pay
the Repurchase Price in Common Stock. The Company may elect to pay
the Repurchase Price by delivery of shares of Common Stock pursuant
to Section 11.1 if and only if the following conditions have been
satisfied:
(a) The shares of Common Stock deliverable in payment of
the Repurchase Price shall have a fair market value as of the
repurchase date of not less than the Repurchase Price. For purposes
of this Section 11.2, the fair market value of shares of Common
Stock shall be determined by the Company and shall be equal to 95%
of the average of the Closing Prices of the Common Stock for the
five consecutive trading days ending on and including the third
trading day immediately preceding the repurchase dates;
(b) In the event any shares of Common Stock to be issued
upon repurchase of Securities hereunder 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, such registration shall
have been completed and shall have become effective prior to the
repurchase date;
(c) In the event any shares of Common Stock to be issued
upon repurchase of Securities hereunder require registration with or
approval of any governmental authority under any State law or any
other Federal law before such shares may be validly issued or
delivered upon repurchase, such registration shall have been
completed, have become effective and such approval shall have been
obtained, in each case, prior to the repurchase date;
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(d) The shares of Common Stock deliverable in payment of
the Repurchase Price shall be listed for trading on a U.S. national
securities exchange or approved for trading on an established
automated over-the-counter trading market in the United States, in
either case, immediately prior to the repurchase date; and
(e) All shares of Common Stock deliverable in payment of
the Repurchase Price shall be issued out of the Company's authorized
but unissued Common Stock and will, upon issue, be duly and validly
issued and fully paid and non-assessable and free of any preemptive
rights.
If all of the conditions set forth in this Section 11.2
are not satisfied in accordance with the terms thereof, the
Repurchase Price shall be paid by the Company only in cash.
SECTION 11.3 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
thirtieth (30th) calendar day after the Company becomes aware of the
occurrence of a Designated Event, the Company or, at the request and
expense of the Company, the Trustee, shall mail to all Holders a
notice (the "Company Notice") of the occurrence of the Designated
Event 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 and cause of such notice of a
Repurchase Right, or a summary of the information contained therein,
to be published in a newspaper of general circulation in The City of
New York. The Company Notice shall contain the following
information:
(1) the repurchase date,
(2) the date by which the Repurchase Right must be
exercised,
(3) the last date by which the election to require
repurchase, if submitted, may be revoked,
(4) the Repurchase Price, and whether the Repurchase Price
shall be paid by the Company in cash or by delivery of shares
of Common Stock,
(5) a description of the procedure which a Holder must
follow to exercise a Repurchase Right, and
(6) the Conversion Price 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
Securities may be surrendered for conversion.
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No failure of the Company to give the foregoing notices or
defect therein shall limit any Holder's right to exercise a
Repurchase Right or affect the validity of the proceedings for the
repurchase of Securities.
If any of the foregoing provisions 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 close of business on the second
Business Day preceding the repurchase date (i) written notice to the
Company (or agent designated by the Company for such purpose) 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, a statement that an election to exercise the Repurchase
Right is being made thereby, and, in the event that the Repurchase
Price shall be paid in shares of Common Stock, the name or names
(with addresses) in which the certificate or certificates for shares
of Common Stock shall be issued, and (ii) the Securities with
respect to which the Repurchase Right is being exercised, duly
endorsed for transfer to the Company. Election of repurchase by a
Holder shall be revocable at any time prior to, but excluding, the
repurchase date, by delivering written notice to that effect to the
Trustee prior to the close of business on the second Business Day
prior to the repurchase date.
(c) In the event the Repurchase Right shall be exercised
in accordance with the terms hereof, the Company shall pay or cause
to be paid to the Trustee the Repurchase Price in cash or shares of
Common Stock, as provided above, for payment to the Holder on the
repurchase date or, if shares of Common Stock are to be issued, as
promptly after the repurchase date as practicable.
(d) If the Company fails to repurchase on the repurchase
date any Securities (or portions thereof) as to which the Repurchase
Right has been properly exercised, then the principal of such
Securities shall, until paid, bear interest to the extent permitted
by applicable law from the repurchase date at the rate borne by the
Securities and each such Security shall be convertible into Common
Stock in accordance with this Indenture (without giving effect to
Section 11.2(b)) until the principal of such Security 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, the Holder thereof or its attorney duly authorized in
writing), and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without
service charge a new Security or Securities, containing identical
terms and conditions, of any authorized denomination as requested by
such Holder in aggregate principal amount equal to and in exchange
for the unrepurchased portion of the principal of the Security so
surrendered.
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(f) One Business Day prior to the repurchase date, the
Company shall deposit with the Trustee or with a Paying Agent (or,
if the Company is acting as its own Paying Agent, segregate and hold
in trust as provided in Section 9.3) an amount of money sufficient
to pay the Repurchase Price of the Securities that are to be repaid
on the repurchase date.
(g) Any issuance of shares of Common Stock in respect of
the Repurchase Price shall be deemed to have been effected
immediately prior to the close of business on the repurchase date
and the person or persons in whose name or names any certificate or
certificates for shares of Common Stock shall be issuable upon such
repurchase shall be deemed to have become on the repurchase date the
holder or holders of record of the shares represented thereby;
provided, however, that any surrender for repurchase on a date when
the stock transfer books of the Company shall be closed shall
constitute the person or persons in whose name or names the
certificate or certificates for such shares are to be issued as the
record holder or holders thereof for all purposes at the opening of
business on the next succeeding day on which such stock transfer
books are open. No payment or adjustment shall be made for dividends
or distributions on any Common Stock issued upon repurchase of any
Security declared prior to the repurchase date.
(h) No fractional shares of Common Stock or scrip
representing fractional shares shall be issued upon repurchase of
Securities. If more than one Security shall be repurchased from the
same holder and the Repurchase Price shall be payable in shares of
Common Stock, the number of full shares which shall be issued upon
repurchase shall be computed on the basis of the aggregate principal
amount of the Securities (or specified portions thereof to the
extent permitted hereby) so repurchased. If any fractional share of
stock otherwise would be issuable upon repurchase of any Security or
Securities, the Company shall make an adjustment therefor in cash at
the current market value thereof to the Holder of Securities. For
these purposes, the current market value of a share of Common Stock
shall be the Quoted Price on the first trading day immediately
preceding the repurchase date.
(i) The issue of stock certificates on repurchase of
Securities shall be made without charge to the Holder of Securities
being repurchased for any tax in respect of the issue thereof. The
Company shall not, however, be required to pay any tax which may be
payable in respect of any transfer involved in the issue and
delivery of stock in any name other than that of the Holder of any
Security repurchased, and the Company shall not be required to issue
or deliver any such stock certificate unless and until the person or
persons requesting the issue thereof shall have paid to the Company
the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid.
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ARTICLE 12
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 definitive
Security or any portion of the principal amount thereof which is
U.S. $1,000 or an integral multiple of U.S. $1,000 may be converted
at the principal amount thereof, or of such portion thereof, into
duly authorized, fully paid and nonassessable shares of Common
Stock, at the Conversion Price, determined as hereinafter provided,
in effect at the time of conversion. Such conversion right shall,
with respect to all Securities, commence on the 60th day following
the latest date of original issuance thereof and expire at the close
of business on October 1, 2006. In case a Security or portion
thereof is called for redemption, such conversion right in respect
of the Security or the portion so called, shall expire at the close
of business on the fifth Business Day preceding the Redemption Date,
unless the Company defaults in making the payment due upon
redemption. In the case of a Designated Event for which the Holder
exercises its Repurchase Right with respect to a Security or portion
thereof, such conversion right in respect of the Security or portion
thereof shall expire upon receipt of the written notice of exercise
of such Repurchase Right.
The price at which shares of Common Stock shall be
delivered upon conversion (herein called the "Conversion Price")
shall be initially U.S. $45.75 per share of Common Stock. The
Conversion Price shall be adjusted in certain instances as provided
in paragraphs (1), (2), (3), (4), (5), (6) and (7) of Section 12.4.
SECTION 12.2 Exercise of Conversion Privilege.
In order to exercise the conversion privilege, the Holder
of any definitive Security to be converted shall surrender such
Security duly endorsed or assigned to the Company or in blank, at
the office of any Conversion Agent (as specified and subject to the
terms and limitations set forth in Section 9.2), accompanied by a
duly signed conversion notice substantially in the form hereinbefore
set forth to the Company at such Conversion Agent 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. Securities surrendered for conversion during the
period from the close of business on any Regular Record Date to the
opening of business on the next succeeding Interest Payment Date
(except in the case of any Security whose Maturity is prior to such
Interest Payment Date) shall be accompanied by payment in New York
Clearing House funds or other funds acceptable to the Company of an
amount equal to the interest to be received on such Interest Payment
Date on the principal amount of Securities being surrendered for
conversion.
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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 Common Stock issuable upon conversion shall
be treated for all purposes as the record holder or holders of such
Common Stock at such time. As promptly as practicable on or after
the conversion date, the Company shall cause to be issued and
delivered to such Conversion Agent a certificate or certificates for
the number of full shares of Common Stock issuable upon conversion,
together with payment in lieu of any fraction of a share as provided
in Section 12.3.
In the event that the Company shall have failed to
register the Common Stock into which the Restricted Securities may
be converted pursuant to an effective registration statement under
the Securities Act, all shares of Common Stock delivered upon such
conversion shall bear a restrictive legend substantially in the form
of the legend required to be set forth on the Restricted Securities
pursuant to Sections 2.5 and as set forth in the form of Security in
Exhibit A hereto and shall be subject to the restrictions on
transfer provided in such legend. Neither the Trustee nor the
Conversion Agent shall have any responsibility for the inclusion or
content of any such restrictive legend on such Common Stock;
provided, however, that the Trustee or such Conversion Agent, as the
case may be, shall have provided, to the Company or to the Company's
transfer agent for such Common Stock, prior to or concurrently with
a request to the Company to deliver to the Conversion Agent
certificates of such Common Stock, 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 Security or Securities of authorized
denominations in aggregate principal amount equal to the unconverted
portion of the principal amount of such Securities.
If shares of Common Stock to be issued upon conversion of
a Restricted Security, or 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 Holder of such Restricted Security, then such
Holder must deliver to the Conversion Agent a certificate in
substantially the form set forth in the form of Security set forth
in Exhibit A hereto, dated the date of surrender of such Restricted
Security and signed by such Holder, 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
Holder shares of Common Stock or Securities issued upon conversion
of any such Restricted Security not so accompanied by a properly
completed certificate.
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SECTION 12.3 Fractions of Shares.
No fractional shares of Common Stock shall be issued upon
any conversion of any Security or Securities. If more than one
Security shall be surrendered for conversion at one time by the same
Holder, the number of full shares which shall be issuable upon
conversion thereof shall be computed on the basis of the aggregate
principal amount of the Securities (or specified portions thereof)
so surrendered. Instead of any fractional share of Common Stock
which would otherwise be issuable upon conversion of any Security or
Securities (or specified portions thereof), the Company shall pay a
cash adjustment in respect of such fraction (calculated to the
nearest one-100th of a share) in an amount equal to the same
fraction of the Quoted Price of the Common Stock as of the trading
day before the date of conversion.
SECTION 12.4 Adjustment of Conversion Price.
The Conversion Price shall be subject to adjustments,
calculated by the Company, from time to time as follows:
(a) In case the Company shall hereafter pay a dividend or
make a distribution to all holders of the outstanding Common Stock
in shares of Common Stock, the Conversion Price in effect at the
opening of business on the date following the date fixed for the
determination of 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
Record Date (as defined in Section 12.4(g)) 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 Record Date.
If any dividend or distribution of the type described in this
Section 12.4(a) is declared but not so paid or made, the Conversion
Price shall again be adjusted to the Conversion Price which would
then be in effect if such dividend or distribution had not been
declared.
(b) In case the Company shall issue rights or warrants to
all holders of its outstanding shares of Common Stock entitling them
(for a period expiring within forty-five (45) days after the date
fixed for the determination of stockholders entitled to receive such
rights or warrants) to subscribe for or purchase shares of Common
Stock at a price per share less than the Current Market Price (as
defined in Section 12.4(g)) on the Record Date fixed for the
determination of stockholders entitled to receive such rights or
warrants, the Conversion Price shall be adjusted so that the same
shall equal the price determined by multiplying the Conversion Price
in effect at the opening of business on the date after such Record
Date by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the
Record Date plus the number of shares which the aggregate offering
price of the total number of shares so offered would purchase at
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such Current Market Price, and of which the denominator shall be the
number of shares of Common Stock outstanding on the close of
business on the Record Date plus the total number of additional
shares of Common Stock so offered for subscription or purchase. Such
adjustment shall become effective immediately after the opening of
business on the day following the Record Date fixed for
determination of stockholders entitled to receive such rights or
warrants. To the extent that shares of Common Stock are not
delivered pursuant to such rights or warrants, upon the expiration
or termination of such rights or warrants the Conversion Price shall
be readjusted to the Conversion Price which would then be in effect
had the adjustments made upon the issuance of such rights or
warrants been made on the basis of the delivery of only the number
of shares of Common Stock actually delivered. In the event that such
rights or warrants are not so issued, the Conversion Price shall
again be adjusted to be the Conversion Price which would then be in
effect if such date fixed for the determination of stockholders
entitled to receive such rights or warrants had not been fixed. In
determining whether any rights or warrants entitle the holders to
subscribe for or purchase shares of Common Stock at less than such
Current Market Price, and in determining the aggregate offering
price of such shares of Common Stock, there shall be taken into
account any consideration received for such rights or warrants, the
value of such consideration if other than cash, to be determined by
the Board of Directors.
(c) In case the outstanding shares of Common Stock shall
be subdivided into a greater number of shares of Common Stock, the
Conversion Price in effect at the opening of business on the day
following the day upon which such subdivision becomes effective
shall be proportionately reduced, and conversely, in case
outstanding shares of Common Stock shall be combined into a smaller
number of shares of Common Stock, the Conversion Price in effect at
the opening of business on the day following the day upon which such
combination becomes effective shall be proportionately increased,
such reduction or increase, as the case may be, to become effective
immediately after the opening of business on the day following the
day upon which such subdivision or combination becomes effective.
(d) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock shares of any class of
capital stock of the Company (other than any dividends or
distributions to which Section 12.4(a) applies) or evidences of its
indebtedness, cash or other assets (including securities, but
excluding (1) any rights or warrants referred to in Section 12.4(b),
(2) dividends and distributions paid exclusively in cash and (3) any
capital stock, evidences of indebtedness, cash or assets distributed
upon a merger or consolidation to which Section 12.11 applies) (the
foregoing hereinafter in this Section 12.4(d) called the
"securities")) (unless the Company elects to reserve such securities
for distribution to the Holders upon conversion of the Securities so
that any such Holder converting Securities will receive upon such
conversion, in addition to the shares of Common Stock to which such
Holder is entitled, the amount and kind of such securities which
such Holder would have received if such Holder had converted its
Securities into Common Stock immediately prior to the Record Date
(as defined in Section 12.4(g)) for such distribution of
79
the securities)), then, in each such case, the Conversion Price
shall be reduced so that the same shall be equal to the price
determined by multiplying the Conversion Price in effect immediately
prior to the close of business on the Record Date (as defined in
Section 12.4(g)) with respect to such distribution by a fraction of
which the numerator shall be the Current Market Price (determined as
provided in Section 12.4(g)) on such date less the fair market value
(as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) on such date of
the portion of the securities so distributed applicable to one share
of Common Stock and the denominator shall be such Current Market
Price, such reduction to become effective immediately prior to the
opening of business on the day following the Record Date; provided,
however, that in the event the then fair market value (as so
determined) of the portion of the securities so distributed
applicable to one share of Common Stock is equal to or greater than
the Current Market Price on the Record Date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each
Holder shall have the right to receive upon conversion of a Security
(or any portion thereof) the amount of securities such Holder would
have received had such Holder converted such Security (or portion
thereof) immediately prior to such Record Date. In the event that
such dividend or distribution is not so paid or made, the Conversion
Price shall again be adjusted to be the Conversion Price would then
be in effect if such dividend or distribution had not been declared.
If the Board of Directors determines the fair market value of any
distribution for purposes of this Section 12.4(d) by reference to
the actual or when issued trading market for any securities
comprising all or part of such distribution, it must in doing so
consider the prices in such market over the same period (the
"Reference Period") used in computing the Current Market Price
pursuant to Section 12.4(g) to the extent possible, unless the Board
of Directors in a Board Resolution determines in good faith that
determining the fair market value during the Reference Period would
not be in the best interest of the Holder.
Rights or warrants distributed by the Company to all
holders of Common Stock entitling the holders thereof to subscribe
for or purchase shares of the Company's capital stock (either
initially or under certain circumstances), which rights or warrants,
until the occurrence of a specified event or events ("Trigger
Event"); (i) are deemed to be transferred with such shares of Common
Stock; (ii) are not exercisable; and (iii) are also issued in
respect of future issuances of Common Stock, shall be deemed not to
have been distributed for purposes of this Section 12.4(d) (and no
adjustment to the Conversion Price under this Section 12.4(d) will
be required) until the occurrence of the earliest Trigger Event. If
such right or warrant is subject to subsequent events, upon the
occurrence of which such right or warrant shall become exercisable
to purchase different securities, evidences of indebtedness or other
assets or entitle the holder to purchase a different number or
amount of the foregoing or to purchase any of the foregoing at a
different purchase price, then the occurrence of each such event
shall be deemed to be the date of issuance and record date with
respect to a new right or warrant (and a termination or expiration
of the existing right or warrant without exercise by the holder
thereof). In addition, in the event of any distribution (or deemed
distribution) of rights or warrants, or any Trigger Event or other
event (of the type described in the preceding sentence) with respect
thereto, that resulted in
80
an adjustment to the Conversion Price under this Section 12.4(d),
(1) in the case of any such rights or warrants which shall all have
been redeemed or repurchased without exercise by any holders
thereof, the Conversion Price shall be readjusted upon such final
redemption or repurchase to give effect to such distribution or
Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price
received by a holder of Common Stock with respect to such rights or
warrant (assuming such holder had retained such rights or warrants),
made to all holders of Common Stock as of the date of such
redemption or repurchase, and (2) in the case of such rights or
warrants all of which shall have expired or been terminated without
exercise, the Conversion Price shall be readjusted as if such rights
and warrants had never been issued.
For purposes of this Section 12.4(d) and Sections 12.4(a)
and (b), any dividend or distribution to which this Section 12.4(d)
is applicable that also includes shares of Common Stock, or rights
or warrants to subscribe for or purchase shares of Common Stock to
which Section 12.4(b) applies (or both), shall be deemed instead to
be (1) a dividend or distribution of the evidences of indebtedness,
assets, shares of capital stock, rights or warrants other than such
shares of Common Stock or rights or warrants to which Section
12.4(b) applies (and any Conversion Price reduction required by this
Section 12.4(d) with respect to such dividend or distribution shall
then be made) immediately followed by (2) a dividend or distribution
of such shares of Common Stock or such rights or warrants (and any
further Conversion Price reduction required by Sections 12.4(a) and
(b) with respect to such dividend or distribution shall then be
made), except (A) the Record Date of such dividend or distribution
shall be substituted as "the date fixed for the determination of
stockholders entitled to receive such dividend or other
distribution", "Record Date fixed for such determinations" and
"Record Date" within the meaning of Section 12.4(a) and as "the date
fixed for the determination of stockholders entitled to receive such
rights or warrants", "the Record Date fixed for the determination of
the stockholders entitled to receive such rights or warrants" and
such "Record Date" within the meaning of Section 12.4(b) and (B) any
shares of Common Stock included in such dividend or distribution
shall not be deemed "outstanding at the close of business on the
date fixed for such determination" within the meaning of Section
12.4(a).
(e) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding any
cash that is distributed upon a merger or consolidation to which
Section 12.11 applies or as part of a distribution referred to in
Section 12.4(d)), in an aggregate amount that, combined together
with (1) the aggregate amount of any other such distributions to all
holders of Common Stock made exclusively in cash within the twelve
(12) months preceding the date of payment of such distribution, and
in respect of which no adjustment pursuant to this Section 12.4(e)
has been made, and (2) the aggregate of any cash plus the fair
market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board
Resolution) of consideration payable in respect of any tender offer
by the Company or any of its Subsidiaries for all or any portion of
the Common Stock concluded within the twelve (12) months preceding
the
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date of such distribution, and in respect of which no adjustment
pursuant to Section 12.4(f) has been made, exceeds 10.0% of the
product of the Current Market Price (determined as provided in
Section 12.4(g)) on the Record Date with respect to such
distribution times the number of shares of Common Stock outstanding
on such date, then and in each such case, immediately after the
close of business on such date, the Conversion Price shall be
reduced so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the
close of business on such Record Date by a fraction (i) the
numerator of which shall be equal to the Current Market Price on the
Record Date less an amount equal to the quotient of (x) the excess
of such combined amount over such 10.0% and (y) the number of shares
of Common Stock outstanding on the Record Date and (ii) the
denominator of which shall be equal to the Current Market Price on
such date, provided, however, that in the event the portion of the
cash so distributed applicable to one share of Common Stock is equal
to or greater than the Current Market Price of the Common Stock on
the Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Holder shall have the right to
receive upon conversion of a Security (or any portion thereof) the
amount of cash such Holder would have received had such Holder
converted such Security (or portion thereof) immediately prior to
such Record Date. In the event that such dividend or distribution is
not so paid or made, the Conversion Price shall again be adjusted to
be the Conversion Price which would then be in effect if such
dividend or distribution had not been declared. Any cash
distribution to all holders of Common Stock as to which the Company
makes the election permitted by Section 12.4(l) and as to which the
Company has complied with the requirements of such Section shall be
treated as not having been made for all purposes of this Section
12.4(e).
(f) In case a tender offer made by the Company or any of
its Subsidiaries for all or any portion of the Common Stock shall
expire and such tender offer (as amended upon the expiration
thereof) shall require the payment to stockholders (based on the
acceptance (up to any maximum specified in the terms of the tender
offer) of Purchased Shares (as defined below)) of an aggregate
consideration having a fair market value (as determined by the Board
of Directors, whose determination shall be conclusive and described
in a Board Resolution) that combined together with (1) the aggregate
of the cash plus the fair market value (as determined by the Board
of Directors, whose determination shall be conclusive and described
in a Board Resolution), as of the expiration of such tender offer,
of consideration payable in respect of any other tender offers, by
the Company or any of its Subsidiaries for all or any portion of the
Common Stock expiring within the twelve (12) months preceding the
expiration of such tender offer and in respect of which no
adjustment pursuant to this Section 12.4(f) has been made and (2)
the aggregate amount of any distributions to all holders of the
Company's Common Stock made exclusively in cash within twelve (12)
months preceding the expiration of such tender offer and in respect
of which no adjustment pursuant to Section 12.4(e) has been made,
exceeds 10.0% of the product of the Current Market Price (determined
as provided in Section 12.4(g)) as of the last time (the "Expiration
Time") tenders could have been made pursuant to such tender offer
(as it may be amended) times the number of shares of Common Stock
outstanding (including any tendered
82
shares) on 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 multiplying the
Conversion Price in effect immediately prior to close of business on
the date of the Expiration Time by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding (including
any tendered shares) on the Expiration Time multiplied by the
Current Market Price of the Common Stock on the Trading Day next
succeeding the Expiration Time and the denominator shall be the sum
of (x) the fair market value (determined as aforesaid) of the
aggregate consideration payable to stockholders based on the
acceptance (up to any maximum specified in the terms of the tender
offer) of all shares validly tendered and not withdrawn as of the
Expiration Time (the shares deemed so accepted, up to any such
maximum, being referred to as the "Purchased Shares") and (y) the
product of the number of shares of Common Stock outstanding (less
any Purchased Shares) on the Expiration Time and the Current Market
Price of the Common Stock on the Trading Day next succeeding the
Expiration Time, such reduction (if any) to become effective
immediately prior to the opening of business on the day following
the Expiration Time. In the event that the Company is obligated to
purchase shares pursuant to any such tender offer, but the Company
is permanently prevented by applicable law from effecting any such
purchases or all such purchases are rescinded, the Conversion Price
shall again be adjusted to be the Conversion Price which would then
be in effect if such tender offer had not been made. If the
application of this Section 12.4(f) to any tender offer would result
in an increase in the Conversion Price, no adjustment shall be made
for such tender offer under this Section 12.4(f). Any cash
distribution to all holders of Common Stock as to which the Company
has made the election permitted by Section 12.4(m) and as to which
the Company has complied with the requirements of such Section shall
be treated as not having been made for all purposes of this Section
12.4(f).
(g) For purposes of this Section 12.4, the following terms
shall have the meaning indicated:
(1) "Closing Price" with respect to any securities on any
day shall mean the closing sale price regular way on such day
or, in case no such sale takes place on such day, the average
of the reported closing bid and asked prices, regular way, in
each case on the Nasdaq National Market, or, if such security
is not listed or admitted to trading on the Nasdaq National
Market, on the principal national security exchange or
quotation system on which such security is quoted or listed or
admitted to trading, or, if not quoted or listed or admitted to
trading on any national securities exchange or quotation
system, the average of the closing bid and asked prices of such
security on the over-the-counter market on the day in question
as reported by the National Quotation Bureau Incorporated, or a
similar generally accepted reporting service, or if not so
available, in such manner as furnished by any New York Stock
Exchange member firm selected from time to time by the Board of
Directors for that purpose,
83
or a price determined in good faith by the Board of Directors,
whose determination shall be conclusive and described in a
Board Resolution.
(2) "Current Market Price" shall mean the average of the
daily Closing Prices per share of Common Stock for the ten (10)
consecutive Trading Days immediately prior to the date in
question; provided, however, that (1) if the "ex" date (as
hereinafter defined) for any event (other than the issuance or
distribution requiring such computation) that requires an
adjustment to the Conversion Price pursuant to Section 12.4(a),
(b), (c), (d), (e) or (f) occurs during such ten (10)
consecutive Trading Days, the Closing Price for each Trading
Day prior to the "ex" date for such other event shall be
adjusted by multiplying such Closing Price by the same fraction
by which the Conversion Price is so required to be adjusted as
a result of such other event, (2) if the "ex" date for any
event (other than the issuance or distribution requiring such
computation) that requires an adjustment to the Conversion
Price pursuant to Section 12.4(a), (b), (c), (d), (e) or (f)
occurs on or after the "ex" date for the issuance or
distribution requiring such computation and prior to the day in
question, the Closing Price for each Trading Day on and after
the "ex" date for such other event shall be adjusted by
multiplying such Closing Price by the reciprocal of the
fraction by which the Conversion Price is so required to be
adjusted as a result of such other event, and (3) if the "ex"
date for the issuance or distribution requiring such
computation is prior to the day in question, after taking into
account any adjustment required pursuant to clause (1) or (2)
of this proviso, the Closing Price for each Trading Day on or
after such "ex" date shall be adjusted by adding thereto the
amount of any cash and the fair market value (as determined by
the Board of Directors in a manner consistent with any
determination of such value for purposes of Section 12.4(d) or
(f), whose determination shall be conclusive and described in a
Board Resolution) of the evidences of indebtedness, shares of
capital stock or assets being distributed applicable to one
share of Common Stock as of the close of business on the day
before such "ex" date. For purposes of any computation under
Section 12.4(f), the Current Market Price of the Common Stock
on any date shall be deemed to be the average of the daily
Closing Prices per share of Common Stock for such day and the
next two succeeding Trading Days; provided, however, that if
the "ex" date for any event (other than the tender offer
requiring such computation) that requires an adjustment to the
Conversion Price pursuant to Section 12.4(a), (b), (c), (d),
(e) or (f) occurs on or after the Expiration Time for the
tender or exchange offer requiring such computation and prior
to the day in question, the Closing Price for each Trading Day
on and after the "ex" date for such other event shall be
adjusted by multiplying such Closing Price by the reciprocal of
the fraction by which the Conversion Price is so required to be
adjusted as a result of such other event. For purposes of this
paragraph, the term "ex" date, (1) when used with respect to
any issuance or distribution, means the first date on which the
Common Stock trades regular way on the relevant exchange or in
the relevant market from which the Closing Price was obtained
without the right to receive such issuance or distribution, (2)
when used with
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respect to any subdivision or combination of shares of Common
Stock, means the first date on which the Common Stock trades
regular way on such exchange or in such market after the time
at which such subdivision or combination becomes effective, and
(3) when used with respect to any tender or exchange offer
means the first date on which the Common Stock trades regular
way on such exchange or in such market after the Expiration
Time of such offer. Notwithstanding the foregoing, whenever
successive adjustments to the Conversion Price are called for
pursuant to this Section 12.4, such adjustments shall be made
to the Current Market Price as may be necessary or appropriate
to effectuate the intent of this Section 12.4 and to avoid
unjust or inequitable results as determined in good faith by
the Board of Directors.
(3) "fair market value" shall mean the amount which a
willing buyer would pay a willing seller in an arm's length
transaction.
(4) "Record Date" shall mean, with respect to any
dividend, distribution or other transaction or event in which
the holders of Common Stock have the right to receive any cash,
securities or other property or in which the Common Stock (or
other applicable security) is exchanged for or converted into
any combination of cash, securities or other property, the date
fixed for determination of stockholders entitled to receive
such cash, securities or other property (whether such date is
fixed by the Board of Directors or by statute, contract or
otherwise).
(5) "Trading Day" shall mean (x) if the applicable
security is listed or admitted for trading on the New York
Stock Exchange or another national security exchange, a day on
which the New York Stock Exchange or another national security
exchange is open for business or (y) if the applicable security
is quoted on the Nasdaq National Market, a day on which trades
may be made thereon or (z) if the applicable security is not so
listed, admitted for trading or quoted, any day other than a
Saturday or Sunday or a day on which banking institutions in
the State of New York are authorized or obligated by law or
executive order to close.
(h) The Company may make such reductions in the Conversion
Price, in addition to those required by Sections 12.4(a), (b), (c),
(d), (e) or (f), as the Board of Directors considers to be advisable
to avoid or diminish any income tax to holders of Common Stock or
rights to purchase Common Stock resulting from any dividend or
distribution of stock (or rights to acquire stock) or from any event
treated as such for income tax purposes.
To the extent permitted by applicable law, the Company
from time to time may reduce the Conversion Price by any amount for
any period of time if the period is at least twenty (20) days and
the reduction is irrevocable during the period. Whenever the
Conversion Price is reduced pursuant to the preceding sentence, the
Company shall mail to each Holder at the address of such Holder as
it appears in the Security appearing on the
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Register a notice of the reduction at least fifteen (15) days prior
to the date the reduced Conversion Price takes effect, and such
notice shall state the reduced Conversion Price and the period
during which it will be in effect.
(i) No adjustment in the Conversion Price shall be
required unless such adjustment would require an increase or
decrease of at least 1% in such price; provided, however, that any
adjustments which by reason of this Section 12.4(i) are not required
to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Article 12 shall
be made by the Company and shall be made to the nearest cent or to
the nearest one hundredth of a share, as the case may be. No
adjustment need be made for a change in the par value or no par
value of the Common Stock.
(j) In any case in which this Section 12.4 provides that
an adjustment shall become effective immediately after a Record Date
for an event, the Company may defer until the occurrence of such
event (i) issuing to the Holder of any Security converted after such
Record Date and before the occurrence of such event the additional
shares of Common Stock issuable upon such conversion by reason of
the adjustment required by such event over and above the Common
Stock issuable upon such conversion before giving effect to such
adjustment and (ii) paying to such holder any amount in cash in lieu
of any fraction pursuant to Section 12.3.
(k) For purposes of this Section 12.4, the number of
shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company will not pay any
dividend or make any distribution on shares of Common Stock held in
the treasury of the Company.
(l) In lieu of making any adjustment to the Conversion
Price pursuant to Section 12.4(e), the Company may elect to reserve
an amount of cash for distribution to the Holders of the Securities
upon the conversion of the Securities so that any such Holder
converting Securities will receive upon such conversion, in addition
to the shares of Common Stock and other items to which such Holder
is entitled, the full amount of cash which such holder would have
received if such Holder had, immediately prior to the Record Date
for such distribution of cash, converted its Securities into Common
Stock, together with any interest accrued with respect to such
amount, in accordance with this Section 12.4(l). The Company may
make such election by providing an Officers' Certificate to the
Trustee to such effect on or prior to the payment date for any such
distribution and depositing with the Trustee on or prior to such
date an amount of cash equal to the aggregate amount the Holders of
the Securities would have received if such Holders had, immediately
prior to the Record Date for such distribution, converted all of the
Securities into Common Stock. Any such funds so deposited by the
Company with the Trustee shall be invested by the Trustee in
marketable obligations issued or fully guaranteed by the United
States government with a maturity not more than three (3) months
from the date of issuance. Upon conversion of
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Securities by a Holder, the Holder will be entitled to receive, in
addition to the Common Stock issuable upon conversion, an amount of
cash equal to the amount such Holder would have received if such
Holder had, immediately prior to the Record Date for such
distribution, converted its Security into Common Stock, along with
such Holder's pro rata share of any accrued interest earned as a
consequence of the investment of such funds. Promptly after making
an election pursuant to this Section 12.4(l), the Company shall give
or shall cause to be given notice to all Holders of such election,
which notice shall state the amount of cash per $1,000 principal
amount of Securities such Holders shall be entitled to receive
(excluding interest) upon conversion of the Securities as a
consequence of the Company having made such election.
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 an
Officers' 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 Officers' Certificate shall
forthwith promptly be filed with the Trustee and with each
Conversion Agent; and
(2) a notice stating that the Conversion Price has been
adjusted and setting forth the adjusted Conversion Price and
the date on which each adjustment becomes effective shall
forthwith be required, and such notice shall be provided by the
Company to all Holders in accordance with Section 1.5.
Neither the Trustee nor any Conversion Agent shall be under any duty
or responsibility with respect to the validity, accuracy or
sufficiency of any such Officers' Certificate, 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 at any time after the date hereof:
(1) the Company shall declare a dividend (or any other
distribution) on its Common Stock payable otherwise than in
cash out of its capital surplus or the consolidated retained
earnings of the Company and its Subsidiaries; or
(2) the Company shall authorize the granting to the
holders of its Common Stock of rights or warrants to subscribe
for or purchase any shares of capital stock of any class or of
any other rights; or
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(3) there shall occur any reclassification of the Common
Stock of the Company (other than a subdivision or combination
of its outstanding shares of Common Stock), or any
consolidation or merger to which the Company is a party and for
which approval of any shareholders of the Company is required,
or the conveyance, transfer or lease of all or substantially
all of the assets of the Company; or
(4) there shall occur the voluntary or involuntary
dissolution, liquidation or winding up of the Company;
then the Company shall cause to be filed at each office or agency
maintained for the purpose of conversion of securities pursuant to
Section 9.2, and shall cause to be provided to all Holders in
accordance with Section 1.5, at least 20 days (or 10 days in any
case specified in clause (1) or (2) above) prior to the applicable
record or effective date hereinafter specified, a notice stating (A)
the date on which a record is to be taken for the purpose of such
dividend, distribution, rights 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 or
warrants are to be determined, or (B) the date on which such
reclassification, consolidation, merger, conveyance, transfer,
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,
lease, dissolution, liquidation or winding up.
SECTION 12.7 Company to Reserve Common Stock.
The Company shall at all times use its best efforts to
reserve and keep available, free from preemptive rights, out of its
authorized but unissued Common Stock, for the purpose of effecting
the conversion of Securities, the full number of shares of fully
paid and nonassessable Common Stock then issuable upon the
conversion of all Outstanding Securities.
SECTION 12.8 Taxes on Conversions.
Except as provided in the next sentence, the Company will
pay any and all taxes (other than taxes on income) and duties that
may be payable in respect of the issue or delivery of shares of
Common Stock on conversion of Securities pursuant hereto. A Holder
delivering a Security for conversion shall be liable for and will be
required to pay any tax or duty which may be payable in respect of
any transfer involved in the issue and delivery of shares of Common
Stock in a name other than that of the Holder of the Security or
Securities to be converted, and no such issue or delivery shall be
made unless and until the Person requesting such issue has paid to
the Company the amount of any such tax or duty, or has established
to the satisfaction of the Company that such tax or duty has been
paid.
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SECTION 12.9 Covenant as to Common Stock.
The Company covenants that all shares of Common Stock
which may be issued upon conversion of Securities will upon issue be
fully paid and nonassessable and, except as provided in Section
12.8, the Company will pay all taxes, liens and charges with respect
to the issue thereof.
SECTION 12.10 Cancellation of Converted Securities.
All Securities delivered for conversion shall be delivered
to the Trustee to be canceled by or at the direction of the Trustee,
which shall dispose of the same as provided in Section 2.9.
SECTION 12.11 Effect of Reclassification, Consolidation,
Merger or Sale.
If any of following events occur, namely (i) any
reclassification or change of the outstanding shares of Common Stock
(other than a change in par value, or from par value to no par
value, or from no par value to par value, or as a result of a
subdivision or combination), (ii) any consolidation, merger or
combination of the Company with another corporation as a result of
which holders of Common Stock shall be entitled to receive stock,
securities or other property or assets (including cash) with respect
to or in exchange for such Common Stock or (iii) any sale or
conveyance of the properties and assets of the Company as, or
substantially as, an entirety to any other corporation as a result
of which holders of Common Stock shall be entitled to receive stock,
securities or other property or assets (including cash) with respect
to or in exchange for such Common Stock, then the Company or the
successor or purchasing corporation, as the case may be, shall
execute with the Trustee a supplemental indenture (which shall
comply with the Trust Indenture Act as in force at the date of
execution of such supplemental indenture if such supplemental
indenture is then required to so comply) providing that such
Security shall be convertible into the kind and amount of shares of
stock and other securities or property or assets (including cash)
receivable upon such reclassification, change, consolidation,
merger, combination, sale or conveyance by a holder of a number of
shares of Common Stock issuable upon conversion of such Securities
(assuming, for such purposes, a sufficient number of authorized
shares of Common Stock available to convert all such Securities)
immediately prior to such reclassification, change, consolidation,
merger, combination, sale or conveyance assuming such holder of
Common Stock did not exercise its rights of election, if any, as to
the kind or amount of securities, cash or other property receivable
upon such consolidation, merger, statutory exchange, sale or
conveyance (provided that, if the kind or amount of securities, cash
or other property receivable upon such consolidation, merger,
statutory exchange, sale or conveyance is not the same for each
share of Common Stock in respect of which such rights of election
shall not have been exercised ("Non-Electing Share"), then for the
purposes of this Section 12.11 the kind and amount of securities,
cash or other property receivable upon such consolidation, merger,
statutory exchange, sale or conveyance for each Non-
89
Electing Share shall be deemed to be the kind and amount so
receivable per share by a plurality of the Non-Electing Shares).
Such supplemental indenture shall provide for adjustments which
shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article. If, in the case of any
such reclassification, change, consolidation, merger, combination,
sale or conveyance, the stock or other securities and assets
receivable thereupon by a holder of shares of Common Stock includes
shares of stock or other securities and assets of a corporation
other than the successor or purchasing corporation, as the case may
be, in such reclassification, change, consolidation, merger,
combination, sale or conveyance, then such supplemental indenture
shall also be executed by such other corporation and shall contain
such additional provisions to protect the interests of the Holders
of the Securities as the Board of Directors shall reasonably
consider necessary by reason of the foregoing, including to the
extent practicable the provisions providing for the Repurchase
Rights set forth in Article 11 herein.
The Company shall cause notice of the execution of such
supplemental indenture to be mailed to each Holder, at the address
of such Holder as it appears on the Security Register, within twenty
(20) days after execution thereof. Failure to deliver such notice
shall not affect the legality or validity of such supplemental
indenture.
The above provisions of this Section shall similarly apply
to successive reclassifications, changes, consolidations, mergers,
combinations, sales and conveyances.
If this Section 12.11 applies to any event or occurrence,
Section 12.4 shall not apply.
SECTION 12.12 Responsibility of Trustee for Conversion
Provisions.
The Trustee, subject to the provisions of Section 5.1, 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
Price, or with respect to the nature or intent of any such
adjustments when made, or with respect to the method employed, or
herein or in any supplemental indenture provided to be employed, in
making the same. Neither the Trustee, subject to the provisions of
Section 5.1, nor any Conversion Agent shall be accountable with
respect to the validity or value (of the kind or amount) of any
Common Stock, or of any other securities or property, which may at
any time be issued or delivered upon the conversion of any Security;
and it or they do not make any representation with respect thereto.
Neither the Trustee, subject to the provisions of Section 5.1, nor
any Conversion Agent shall he responsible for any failure of the
Company to make any cash payment or to issue, transfer or deliver
any shares of stock or share certificates or other securities or
property upon the surrender of any Security for the purpose of
conversion; and the Trustee, subject to the provisions of Section
5.1, and any Conversion Agent shall not be responsible or liable for
any failure of the Company to comply with any of the covenants of
the Company contained in this Article.
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ARTICLE 13
SUBORDINATION
SECTION 13.1 Securities Subordinated to Senior Debt.
The Company covenants and agrees, and each Holder of
Securities, by such Holder's acceptance thereof, likewise covenants
and agrees, that the indebtedness represented by the Securities and
the payment of the principal of and premium, if any, and interest
(including Liquidated Damages, if any) on each and all of the
Securities is hereby expressly subordinate and junior, to the extent
and in the manner hereinafter set forth, in right of payment to the
prior payment in full of all Senior Debt.
(a) In the event of any distribution of assets of the
Company upon any dissolution, winding up, liquidation or
reorganization of the Company, whether in bankruptcy, insolvency,
reorganization or receivership proceedings or upon an assignment for
the benefit of creditors or any other marshalling of the assets and
liabilities of the Company or otherwise, then the holders of all
Senior Debt shall first be entitled to receive payment of the full
amount due thereon in respect of principal and premium, if any, and
interest (including interest accruing after the commencement of any
bankruptcy proceeding, regarding of whether such interests is an
allowed claim in such proceeding) and all other amounts due or
provision shall be made for such amount in cash before the Holders
of any of the Securities are entitled to receive any payment or
distribution of any character, whether in cash, securities or other
property, on account of the principal of or premium, if any, or
interest on the indebtedness evidenced by the Securities.
(b) In the event of any default in payment of the
principal of or premium, if any, or interest on any Senior Debt,
then, unless and until all such payments due in respect of such
Senior Debt have been paid in full or such default shall have been
cured or waived or shall have ceased to exist, no payment shall be
made by the Company with respect to the principal of, premium, if
any, or interest (including Liquidated Damages, if any) on the
Securities or to acquire any of the Securities (including any
redemption, cash conversion or repurchase pursuant to the exercise
of the Repurchase Right).
(c) During the continuance of any event of default with
respect to any Senior Debt, as such event of default is defined
under any such Senior Debt or in any agreement pursuant to which any
Senior Debt has been issued (other than a default in payment of the
principal of or premium, if any, or interest on any Senior Debt),
permitting the holder or holders of such Senior Debt to accelerate
the maturity thereof, no payment shall be made by the Company,
directly or indirectly, with respect to principal of, premium, if
any, or interest (including Liquidated Damages, if any) on the
Securities (including any redemption, cash conversion or repurchase
pursuant to the exercise of the Repurchase Right) for 180 days
following notice in writing to the Company, from any holder or
holders of such
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Senior Debt or their representative or representatives or the
trustee or trustees under any indenture or under which any
instrument evidencing any such Senior Debt may have been issued,
that such an event of default has occurred and is continuing, unless
such event of default has been cured or waived or such Senior Debt
has been paid in full; provided, however, if the maturity of such
Senior Debt is accelerated, no payment may be made on the Securities
until such Senior Debt has been paid or such acceleration has been
cured or waived. For purposes of this Section 13.1(c), such notice
shall be deemed to include notice of all other events of default
under such indenture or instrument, which are continuing at the time
of the event of default specified in such notice. The provisions of
this Section 13.1(c) shall apply only to one such notice given in
any period of nine consecutive months with respect to any issue of
Senior Debt and no more than one such notice under this Section
13.1(c) only be given with respect to any such continuing event of
default under any issue of Senior Debt for such nine-month period.
(d) In the event that, notwithstanding the foregoing
provisions of Sections 13.1(a), (b) and (c), any payment on account
of principal, premium, if any, or interest (including Liquidated
Damages, if any) on the Securities shall be made by or on behalf of
the Company and received by the Trustee, by any Holder or by any
Paying Agent (or, if the Company is acting as its own Paying Agent,
money for any such payment shall be segregated and held in trust),
(i) after the occurrence of an event specified in Section 13.1(a),
then, unless and until all Senior Debt is paid in full in cash, or
provision shall he made therefor, (ii) after the happening of an
event of default under any Senior Debt of the type specified in
Section 13.1(b) above, then, unless and until the amount of such
Senior Debt then due shall have been paid in full, or provision made
therefor or such event of default shall have been cured or waived,
or (iii) after the happening of an event of default of the type
specified in Section 13.1(c) above, unless and until such event of
default shall have been cured or waived or the 180-day period
specified in Section 13.1(c) shall have expired, such payment
(subject, in each case, to the provisions of Section 13.7) shall he
held in trust for the benefit of, and shall be immediately paid over
to, the holders of Senior Debt or their representative or
representatives or the trustee or trustees under any indenture under
which any instruments evidencing any of the Senior Debt may have
been issued, as their interests my appear. The Company shall give
prompt written notice to the Trustee of any default under any Senior
Debt or under any agreement pursuant to which Senior Debt may have
been issued.
SECTION 13.2 Subrogation.
Subject to the payment in full of all Senior Debt to which
the indebtedness evidenced by the Securities is in the circumstances
subordinated as provided in Section 13.1, the Holders of the
Securities shall be subrogated to the rights of the holders of such
Senior Debt to receive payments or distributions of cash, property
or securities of the Company applicable to such Senior Debt until
all amounts owing on the Securities shall be paid in full, and, as
between the Company, its creditors other than holders of such Senior
Debt, and the Holders of the Securities, no such payment or
distribution made to the holders of Senior
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Debt by virtue of this Article which otherwise would have been made
to the holders of the Securities shall be deemed to be a payment by
the Company on account of such Senior Debt, it being understood that
the provisions of this Article are and are intended solely for the
purpose of defining the relative rights of the Holders of the
Securities, on the one hand, and the holders of Senior Debt, on the
other hand.
SECTION 13.3 Obligation of Company Unconditional.
Nothing contained in this Article or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as
between the Company, its creditors other than the holders of Senior
Debt, 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
(including Liquidated Damages, if any) on the Securities as and when
the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of the
Holders of the Securities and creditors of the Company other than
the holders of Senior Debt, nor shall anything herein or therein
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 Debt in respect of cash, property
or securities of the Company received upon the exercise of any such
remedy.
SECTION 13.4 Maturity of or Default on Senior Debt.
Upon the maturity of any Senior Debt by lapse of time,
acceleration or otherwise, then all principal of and interest on all
such matured Senior Debt shall first be paid in full, or such
payment shall have been duly provided for, before any payment on
account of principal, or premium, if any, or interest (including
Liquidated Damages, if any) is made upon the Securities.
SECTION 13.5 Payments on Securities Permitted.
Except as expressly provided in this Article, nothing
contained in this Article shall affect the obligation of the Company
to make, or prevent the Company from making, payments of the
principal of, or premium, if any, or interest (including Liquidated
Damages, if any) on the Securities in accordance with the provisions
hereof and thereof, or shall prevent the Trustee or any Paying Agent
from applying any moneys deposited with it hereunder to the payment
of the principal of, or premium, if any, or interest (including
Liquidated Damages, if any) on the Securities.
SECTION 13.6 Effectuation of Subordination by Trustee.
Each Holder of Securities, by such Holder's acceptance
thereof, authorizes and directs the Trustee on such Holder's behalf
to take such action as may be necessary or
93
appropriate to effectuate the subordination provided in this Article
and appoints the Trustee such Holder's attorney-in-fact for any and
all such purposes.
Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee and the Holders of the
Securities shall be entitled to rely upon any order or decree made
by any court of competent jurisdiction in which any such
dissolution, winding up, liquidation or reorganization proceeding
affecting the affairs of the Company is pending or upon a
certificate of the trustee in bankruptcy, receiver, assignee for the
benefit of creditors, liquidating trustee or agent or other Person
making any payment or distribution, delivered to the Trustee or to
the Holders of the Securities, for the purpose of ascertaining the
Persons entitled to participate in such payment or distribution, and
as to other facts pertinent to the right of such Persons under this
Article, and if such evidence is not furnished, the Trustee may
defer any payment to such Persons pending judicial determination as
to the right of such Persons to receive such payment.
SECTION 13.7 Knowledge of Trustee.
Notwithstanding the provision of this Article or any other
provisions of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any Senior Debt, of any default in
payment of principal of, premium, if any, or interest on any Senior
Debt, or of any facts which would prohibit the making of any payment
of moneys to or by the Trustee, or the taking of any other action by
the Trustee, unless and until a Responsible Officer of the Trustee
having responsibility for the administration of the trust
established by this Indenture shall have received written notice
thereof from the Company, any Holder of Securities, any Paying or
Conversion Agent of the Company or the holder or representative of
any class of Senior Debt, and, prior to the receipt of any such
written notice, the Trustee shall be entitled in all respects to
assume that no such default or facts exist; provided, however, that
unless on the third Business Day prior to the date upon which by the
terms hereof any such moneys may become payable for any purpose the
Trustee shall have received the notice provided for in this Section
13.7, then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to
receive such moneys and apply the same to the purpose for which they
were received, and shall not be affected by any notice to the
contrary which may be received by it on or after such date.
SECTION 13.8 Trustee's Relation to Senior Debt.
The Trustee shall be entitled to all the rights set forth
in this Article with respect to any Senior Debt at the time held by
it, to the same extent as any other holder of Senior Debt and
nothing in this Indenture shall deprive the Trustee of any of its
rights as such holder.
Nothing in this Article shall apply to claims of or
payments to the Trustee under or pursuant to Section 5.7.
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With respect to the holders of Senior Debt, the Trustee
undertakes to perform or to observe only such of its covenants and
obligations as are specifically set forth in this Article, and no
implied covenants or obligations with respect to the holders of
Senior Debt shall be read into this Indenture against the Trustee.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt and the Trustee shall not be liable to any
holder of Senior Debt if it shall pay over or deliver to Holders,
the Company or any other Person moneys or assets to which any holder
of Senior Debt shall be entitled by virtue of this Article or
otherwise.
SECTION 13.9 Rights of Holders of Senior Debt Not
Impaired.
No right of any present or future holder of any Senior
Debt to enforce the subordination herein shall at any time or in any
way be prejudiced or impaired by any act or failure to act on the
part of the Company or by any noncompliance 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.
SECTION 13.10 Modification of Terms of Senior Debt.
Any renewal or extension of the time of payment of any
Senior Debt or the exercise by the holders of Senior Debt of any of
their rights under any instrument creating or evidencing Senior
Debt, including without limitation the waiver of default thereunder,
may be made or done all without notice to or assent from the Holders
of the Securities or the Trustee.
No compromise, alteration, amendment, modification,
extension, renewal or other change of, or waiver, consent or other
action in respect of, any liability or obligation under or in
respect of, or of any of the terms, covenants or conditions of any
indenture or other instrument under which any Senior Debt is
outstanding or of such Senior Debt, whether or not such release is
in accordance with the provisions or any applicable document, shall
in any way alter or affect any of the provisions of this Article or
of the Securities relating to the subordination thereof.
95
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, all as of the day and year
first above written.
COMVERSE TECHNOLOGY, INC.
By
Name: Xxxx Xxxxxxxxx
Title: President
Attest:
By
Name: Xxxxxxx X. Xxxxx
Title: Secretary
THE CHASE MANHATTAN BANK, as Trustee
By
Name
Title: Vice President
Attest:
By
Name:
Title: Assistant Xxxxxxxxx
00
XXXXX XX XXX XXXX )
: ss.:
COUNTY OF NEW YORK )
On the 4th day of October 1996, before me personally came
Xxxx Xxxxxxxxx to me known, who, being by me duly sworn, did depose
and say that he is President of Comverse Technology, Inc., one of
the corporations described in and which executed the foregoing
instrument; that he knows the seal of said corporation; that the
seal affixed to said instrument is such corporate seal; that it was
so affixed by authority of the Board of Directors of said
corporation, and that he signed his name thereto by like authority.
Notary Public
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On the 4th day of October 1996, before me personally came
____________________, to me known, who, being by me duly sworn, did
depose and say that he/she is a _________________ of The Chase
Manhattan Bank, a New York banking corporation described in and
which executed the foregoing instrument; that he/she knows the seal
of said national banking association; that the seal affixed to said
instrument is such corporate seal; that it was so affixed by
authority of the Board of Directors of said corporation, and that
he/she signed his name thereto by like authority.
Notary Public
EXHIBIT A - FORM OF SECURITY
[FORM OF FACE OF SECURITY]
[INCLUDE IF SECURITY IS A REGULATION S GLOBAL SECURITY -- THIS
SECURITY IS A REGULATION S GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE REFERRED TO HEREINAFTER. EXCEPT IN THE CIRCUMSTANCES
DESCRIBED IN SECTION 2.5(b) OF THE INDENTURE, NO TRANSFER OR
EXCHANGE OF AN INTEREST IN THIS REGULATION S GLOBAL SECURITY MAY BE
MADE FOR AN INTEREST IN THE RESTRICTED GLOBAL SECURITY DURING THE
RESTRICTED PERIOD.]
[INCLUDE IF SECURITY IS A GLOBAL SECURITY -- UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY
STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD WITHIN THE
UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS
EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ACQUISITION
HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED
IN RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT)
("INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON
AND IS ACQUIRING THE SECURITY EVIDENCED HEREBY IN AN OFFSHORE
TRANSACTION; (2) AGREES THAT IT WILL NOT WITHIN THREE YEARS AFTER
THE ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY RESELL OR
OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR THE COMMON STOCK
ISSUABLE UPON CONVERSION OF SUCH SECURITY EXCEPT (A) TO THE COMPANY
OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A
A-1
UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER,
FURNISHES TO THE CHASE MANHATTAN BANK, AS TRUSTEE (OR ANY SUCCESSOR
TRUSTEE, AS APPLICABLE), A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON
TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER
CAN BE OBTAINED FROM SUCH TRUSTEE), (D) OUTSIDE THE UNITED STATES IN
COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT, (E) PURSUANT TO
THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (F) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT
(AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER);
AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE
SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER
PURSUANT TO 2(F) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED
HEREBY WITHIN THREE YEARS AFTER THE ORIGINAL ISSUANCE OF THE
SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(F) ABOVE), THE
HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE
HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
CERTIFICATE TO THE CHASE MANHATTAN BANK, AS TRUSTEE (OR ANY
SUCCESSOR TRUSTEE, AS APPLICABLE). IF THE PROPOSED TRANSFER IS
PURSUANT TO CLAUSE 2(C) OR 2(E) ABOVE, THE HOLDER MUST, PRIOR TO
SUCH TRANSFER, FURNISH TO THE CHASE MANHATTAN BANK, AS TRUSTEE (OR
ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS THE COMPANY MAY REASONABLY REQUIRE
TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED UPON
THE EARLIER OF THE TRANSFER OF THE SECURITY EVIDENCED HEREBY
PURSUANT TO CLAUSE 2(F) ABOVE OR THE EXPIRATION OF THREE YEARS FROM
THE ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY. AS USED
HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S.
PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
COMVERSE TECHNOLOGY, INC.
5-3/4% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2006
No.-------------------------- $--------------------
A-2
COMVERSE TECHNOLOGY, INC., a corporation duly organized
and existing under the laws of the State of New York (herein called
the "Company," which term includes any successor corporation under
the Indenture referred to on the reverse hereof), for value
received, hereby promises to pay to ____________________, or
registered assigns, the principal sum of ______________________ U.S.
Dollars on October 1, 2006 and to pay interest (including Liquidated
Damages, if any) thereon, from October 4, 1996 or from the most
recent Interest Payment Date to which interest has been paid or duly
provided for, semiannually in arrears on April 1 and October 1 in
each year (each an "Interest Payment Date"), commencing April 1,
1997, at the rate of 5-3/4% per annum, until the principal hereof is
paid or made available for payment. The interest (including
Liquidated Damages, if any) 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 March 15 (whether or not a Business Day) next preceding an
April 1 Interest Payment Date and the September 15 (whether or not a
Business Day) next preceding an October 1 Interest Payment Date.
Except as otherwise provided in the Indenture, any such interest
(including Liquidated Damages, if any) 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 Trustee,
notice whereof shall be given to Holders of Securities not less than
10 days prior to such Special Record Date, or be paid at any time in
any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities may be listed, and
upon such notice as may be required by such exchange, all as more
fully provided in the Indenture. Payments of principal and premium,
if any, 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 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. Payment of interest (including Liquidated Damages, if any) on
this Security may be made by U.S. Dollar check drawn on a bank in
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 application by the Holder to the Security Registrar not later
than the relevant Record Date, by wire transfer to a U.S. Dollar
account (such wire transfers to be made only to Holders of an
aggregate principal amount in excess of U.S. $5,000,000) maintained
by the payee with a bank in The City of New York.
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.
A-3
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee by the manual signature of
an authorized signatory, 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 under its corporate seal.
Dated:
COMVERSE TECHNOLOGY, INC.
[Corporate Seal] By:
Attest:
_______________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities described in the within-named Indenture.
THE CHASE MANHATTAN BANK, as Trustee
By:
Authorized Signatory
A-4
REVERSE OF SECURITY
COMVERSE TECHNOLOGY, INC.
5-3/4% CONVERTIBLE SUBORDINATED DEBENTURE DUE 2006
This Security is one of a duly authorized issue of
Securities of the Company designated as its "5-3/4% Convertible
Subordinated Debentures Due 2006" (herein called the "Securities"),
limited in aggregate principal amount to U.S. $100,000,000 (subject
to increase as provided in the Indenture (as hereinafter defined) of
up to an additional $15,000,000 aggregate principal amount), issued
and to be issued under an Indenture, dated as of October 4, 1996
(herein called the "Indenture"), between the Company and The Chase
Manhattan Bank, as Trustee (herein called the "Trustee," which term
includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is
hereby made for a statement of the respective rights, limitations of
rights, duties and immunities thereunder of the Company, the
Trustee, the holders of Senior Debt, and the Holders of the
Securities and of the terms upon which the Securities are, and are
to be, authenticated and delivered. The Securities are issuable in
registered form, without coupons, in denominations of U.S. $1,000
and integral multiples thereof. As provided in the Indenture and
subject to certain limitations therein set forth, Securities are
exchangeable for a like aggregate principal amount of Securities of
any authorized denominations as requested by the Holder surrendering
the same upon surrender of the Security or Securities to be
exchanged, except as provided below, at the office or agency of the
Company in The City of New York, or at such other offices or
agencies as the Company may designate.
The Securities are subject to redemption any time on or
after October 12, 1999, in whole or in part, at the election of the
Company, at Redemption Prices (expressed as percentages of the
principal amount) set forth below if redeemed during the
twelve-month period beginning October 1 of the years indicated
(October 12 in the case of 1999):
1999........................................102%
2000........................................101%
2001 and thereafter.........................100%
Notice of redemption will be given as provided in the
Indenture.
Upon the occurrence of a "Designated Event" prior to
October 1, 2006, the Holder has the right (the Repurchase Right"),
at such Holder's option, to require the Company to repurchase all or
any portion of such Holder's Securities on the repurchase date
established by the Company at a price equal to 100% of the principal
amount of the Securities, together in each case with accrued
interest to, but excluding, the date fixed for redemption; provided
that if such repurchase date is April 1 or October 1, then the
interest payable on such date shall be paid to the Holder on the
next preceding March 15 or
A-5
September 15, respectively. The Company shall mail to all Holders a
notice of the occurrence of a Designated Event, of the repurchase
date (which shall be not less than 30 nor more than 45 days after
the notice) and of the Repurchase Right arising as a result thereof
on or before 30 calendar days after the Company becomes aware of the
occurrence of such Designated Event. At the option of the Company,
the Repurchase Price may be paid in cash or, subject to the
conditions provided in the Indenture, upon a Designated Event which
constitutes a "Change in Control," by delivery of shares of Common
Stock having a fair market value equal to the Repurchase Price. For
purposes of this paragraph, the fair market value of shares of
Common Stock shall be determined by the Company and shall be equal
to 95% of the average of the Quoted Prices of the Common Stock for
the five consecutive trading days ending on and including the third
trading day immediately preceding the repurchase date. Whenever in
this Security 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 eighth succeeding paragraph,
such reference shall be deemed to include reference to the
Repurchase Price only if the Repurchase Price is payable in cash.
Subject to and upon compliance with the provisions of the
Indenture, the Holder of this Security is entitled, at such Holder's
option, at any time on or after the 60th day following the latest
date of original issuance of the Securities and on or before the
close of business on October 1, 2006, or in case this Security or a
portion hereof is called for redemption, then in respect of this
Security or such portion hereof until and including, but (unless the
Company defaults in making the payment due upon redemption) not
after, the close of business on the fifth Business Day preceding the
Redemption Date, or in the case of a Designated Event for which the
Holder exercises its Repurchase Right with respect to this Security
or a portion hereof, then in respect of this Security or such
portion hereof, until, but not after, receipt of the written notice
of exercise of such Repurchase Right, to convert this Security (or
any portion of the principal amount hereof which is U.S. $1,000 or
an integral multiple thereof), at the principal amount hereof, or of
such portion, into newly issued, fully paid and nonassessable shares
of Common Stock of the Company at a Conversion Price equal to U.S.
$45.75 aggregate principal amount of Securities for each share of
Common Stock (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 to the opening
of business on the next succeeding Interest Payment Date (unless
this Security or the portion thereof being converted has been called
for redemption on a Redemption Date within such period), also
accompanied by payment in New
A-6
York Clearing House or other funds acceptable to the Company of an
amount equal to the interest (including Liquidated Damages, if any)
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 as may
be designated by it for such purpose in The City of New York. No
payment or adjustment will be made on conversion of this Security
for interest (including Liquidated Damages, if any) accrued hereon
to the date of conversion or for dividends on the Common Stock
issued on conversion. No fractions of shares or scrip representing
fractions of shares will be issued on conversion, but instead of any
fractional interest (calculated to the nearest 1/100th of a share)
the Company shall pay a cash adjustment as provided in the
Indenture. The Conversion Price is subject to adjustment as provided
in the Indenture. In addition, the Indenture provides that in case
of certain consolidations, mergers or conveyances to which the
Company is a party or certain transfers of all or substantially all
of the assets of the Company, 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 or
transfer by a holder of the number of shares of Common Stock of the
Company into which this Security might have been converted
immediately prior to such consolidation, merger, conveyance or
transfer (assuming such holder of Common Stock failed to exercise
any rights of election, if any, as to the kind or amount of
securities, cash or other property receivable upon consolidation,
merger, conveyance or transfer and received per share the kind and
amount received per share by a plurality of nonelecting shares),
assuming further, if such consolidation, merger, conveyance or
transfer is consummated before the 60th day following the latest
date of original issuance of the Securities, that this Security was
convertible at the time of such consolidation, merger, conveyance or
transfer at the initial Conversion Price specified above as adjusted
from October 4, 1996 to the time of such consolidation, merger,
conveyance or transfer pursuant to the Indenture and the Company
must ensure that appropriate securities, cash or other property are
placed in escrow or otherwise reserved through the 60th day
following the latest date of original issuance of the Securities,
for the benefit of Holders of Securities upon conversion of such
Securities. Adjustments in the Conversion Price of less than one
percent of such price will not be required, but any adjustment that
would otherwise be required to be made will be carried forward and
taken into account in the computation of any subsequent adjustment.
In the event of a redemption in part, the Company will not
be required (a) to register the transfer of, or exchange, Securities
for a period of 15 days immediately preceding the date notice is
given identifying the serial numbers of the Securities called for
such redemption, or (b) to register the transfer of, or exchange,
any such Securities, or portion thereof, called for redemption.
A-7
In the event of redemption of the Securities or conversion
or repurchase of this Security in part only, a new Security or
Securities for the unredeemed or unconverted portion thereof will be
issued in the name of the Holder hereof.
Subject to certain limitations in the Indenture, at any
time when the Company is not subject to Section 13 or 15(d) of the
U.S. Securities Exchange Act of 1934, upon the request of a Holder
of a Security, the Company will promptly furnish or cause to be
furnished Rule 144A Information (as defined below) to such Holder or
to a purchaser of such Security designated by such Holder, as the
case may be, in order to permit compliance by such Holder with Rule
144A under the U.S. Securities Act of 1933, as amended (the
"Securities Act"). "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).
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
amounts then due on all Senior Debt 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 such Holder's behalf to take
such action as may be necessary or appropriate to effectuate the
subordination so provided and (c) appoints the Trustee such Holder's
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 may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights
and obligations of the Company and the rights of the Holders of the
Securities under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of a majority in principal
amount of the Securities at the time Outstanding (or such lesser
amount as shall have acted at a meeting pursuant to the provisions
of the Indenture). The Indenture also contains provisions permitting
the Holders of specified percentages in principal amount of the
Securities at the time Outstanding, on behalf of the Holders of all
the Securities, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any
Security issued upon registration of transfer hereof or in exchange
herefor or in lieu hereof, whether or not notation of such consent
or waiver is made upon this Security or such other Security.
A-8
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 and premium, if any, and interest (including
Liquidated Damages, if any) on this Security at the times, places
and rate, and in the coin or currency, herein prescribed or to
convert this Security (or pay cash in lieu of conversion) as
provided in the Indenture.
Pursuant to the Registration Rights Agreement, upon the
effectiveness of the Shelf Registration Statement, each Holder must
notify the Company not later than three Business Days prior to any
proposed sale by such Holder of Securities pursuant to the Shelf
Registration Statement (a "Sale Notice"), which notice shall be
effective for five Business Days. The Company may, upon written
notice to such Holder, suspend such Holder's use of the prospectus
(which is part of the Shelf Registration Statement) for a reasonable
period not to exceed 60 days if the Company in it reasonable
judgment believes it may possess material non-public information the
disclosure of which would have a material adverse effect on the
Company and its subsidiaries taken as a whole. Each Holder of this
Security, by accepting the same, agrees to hold any communication by
the Company in response to a Sale Notice in confidence.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of Securities is
registrable on the Security Register upon surrender of a Security
for registration of transfer at the office or agency of the Company
in The City of New York or, subject to any laws or regulations
applicable thereto and to the right of the Company to terminate the
appointment of any such Transfer Agent, at the Corporate Trust
Office of the Trustee in The City of New York or at the offices of
the Transfer Agents described herein 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 the Holder's attorney duly authorized in writing,
and thereupon one or more new Securities, of authorized
denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
No service charge shall be made for any such registration
of transfer or exchange, but the Company may require payment of a
sum sufficient to recover any tax or other governmental charge
payable in connection therewith.
The Company, the Trustee and any agent of the Company or
the Trustee may treat the person in whose name this Security is
registered as the owner hereof for all purposes, whether or not this
Security may be overdue, and neither the Company, the Trustee nor
any such agent shall be affected by notice to the contrary.
A-9
The Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York,
without reference to such State's conflict of laws principles.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
ASSIGNMENT
For value received ____________________ hereby sell(s),
assign(s) and transfer(s) unto ____________________ (Please insert
social security or Taxpayer Identification Number of assignee) the
within Security, and hereby irrevocably constitutes and appoints
________________________________ attorney to transfer the said
Security on the books of the Company, with full power of
substitution in the premises.
In connection with any transfer of the within Security
occurring within three years of the original issuance of such
Security (unless such Security is being transferred pursuant to a
registration statement that has been declared effective under the
Securities Act), the undersigned confirms that such Security is
being transferred:
/ / To the Company or a subsidiary thereof; or
/ / Pursuant to and in compliance with Rule 144A
under the Securities Act of 1933, as amended; or
/ / To an Institutional Accredited Investor pursuant to
and in compliance with the Securities Act of 1933, as
amended; or
/ / Pursuant to and in compliance with Regulation S under
the Securities Act of 1933, as amended; or
/ / Pursuant to and in compliance with Rule 144 under the
Securities Act of 1933, as amended;
and unless the box below is checked, the undersigned confirms that
such Security is not being transferred to an "affiliate" of the
Company as defined in Rule 144 under the Securities Act of 1933, as
amended (an "Affiliate"):
/ / The transferee is an Affiliate of the Company.
A-10
Dated:
Signature(s)
Signature(s) must be guaranteed by an eligible
Guarantor Institution (banks, stock brokers,
savings and loan associations and credit unions)
with membership in an approved signature guarantee
medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15 if shares of
Common Stock are to be issued, or Securities to be
delivered, other than to and in the name of the
required holder.
Signature Guarantee
NOTICE: The signature must correspond with the name as written
upon the face of the Security in every particular without
alternation or enlargement or any change whatever.
A-11
[FORM OF CONVERSION NOTICE]
CONVERSION NOTICE
TO: COMVERSE TECHNOLOGY, INC.
The undersigned registered owner of this Security hereby
irrevocably exercises the option to convert this Security, or the
portion hereof (which is $1,000 principal amount or an integral
multiple thereof) below designated, into shares of Common Stock in
accordance with the terms of the Indenture referred to in this
Security, and directs that the shares issuable and deliverable upon
such conversion, together with any check in payment for fractional
shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder
hereof unless a different name has been indicated below. If shares
or any portion of this Security not converted are to be issued in
the name of a person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto. Any amount
required to be paid to the undersigned on account of interest
(including Liquidated Damages, if any) accompanies this Security.
Dated: ------------------------
Signature(s)
Signature(s) must be guaranteed by an eligible
Guarantor Institution (banks, stock brokers,
savings and loan associations and credit unions)
with membership in an approved signature guarantee
medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15 if shares of
Common Stock are to be issued, or Securities to be
delivered, other than to and in the name of the
required holder.
--------------------------------------------
Signature Guarantee
NOTICE: The signature must correspond with the name as written upon the
face of the Security in every particular without alternation or
enlargement or any change whatever.
A-12
Fill in for registration of shares if to be
issued, and Securities if to be delivered,
other than to and in the name of the
registered holder:
(Name)
(Street Address)
(City, State and Zip Code)
Please print name and address
Principal amount to be converted (if less than
all):
$ ,000
Social Security or Other Taxpayer Identification
Number
A-13
[FORM OF OPTION TO ELECT REPAYMENT
UPON A DESIGNATED EVENT]
TO: COMVERSE TECHNOLOGY, INC.
The undersigned registered owner of this Security hereby
acknowledges receipt of a notice from Comverse Technology, Inc. (the
"Company") as to the occurrence of a Designated Event with respect to the
Company and requests and instructs the Company to repay the entire principal
amount of this Security, or the portion thereof (which is $1,000 principal
amount or an integral multiple thereof) below designated, in accordance with
the terms of the Indenture referred to in this Security, together with
accrued interest (including Liquidated Damages, if any) to, but excluding,
such date, to the registered holder hereof, in cash or, at the Company's
election upon a Designated Event which constitutes a Change in Control and
subject to certain conditions contained in the Indenture, in Common Stock.
Dated: ----------------------------
-----------------------------
Signature(s)
Social Security or Other Taxpayer
Identification Number
Principal amount to be repaid (if less than
all): $ ,000
NOTICE: The above signatures of the holder(s)
hereof must correspond with the name as
written upon the face of the Security in every
particular without alternation or enlargement
or any change whatever.
A-14
EXHIBIT B
FORM OF PURCHASER LETTER FOR
INSTITUTIONAL ACCREDITED INVESTORS
Comverse Technology, Inc.
000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxxxx, Xxx Xxxx 00000
Xxxxxx Brothers Inc.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
The undersigned is delivering this letter in connection with an
offering of 5- 3/4% Convertible Senior Subordinated Debentures due 2006 (the
"Debentures"), which are convertible into shares of Common Stock, $.10 par
value (the "Common Stock"), of Comverse Technology, Inc. (the "Company") all
as described in the Offering Memorandum (the "Offering Memorandum") relating
to the offering.
The undersigned hereby confirms that:
(i) The undersigned is an "accredited investor" within the
meaning of Rule 501(a)(1), (2) or (3) under the Securities Act of 1933 (the
"Securities Act") or an entity in which all of the equity owners are
accredited investors within the meaning of Rule 501(a)(1), (2) or (3) under
the Securities Act (an "Institutional Accredited Investor");
(ii) (A) any purchase of Debentures by the undersigned will
be for the undersigned's own account or for the account of one or more other
Institutional Accredited Investors or as fiduciary for the account of one or
more trusts, each of which is an "accredited investor" within the meaning of
Rule 501(a)(7) under the Securities Act and for each of which the
undersigned exercises sole investment discretion or (B) the undersigned is a
"bank," within the meaning of Section 3(a)(2) of the Securities Act, or a
"savings and loan association" or other institution described in Section
3(a)(5)(A) of the Securities Act that is acquiring Debentures as fiduciary
for the account of one or more institutions for which the undersigned
exercises sole investment discretion;
B-1
(iii) In the event that the undersigned purchases any
Debentures, the undersigned will acquire Debentures having a minimum
principal amount of not less than $250,000 for its own account or for any
separate account for which the undersigned is acting;
(iv) The undersigned has such knowledge and experience in
financial and business matters that the undersigned is capable of evaluating
the merits and risk of purchasing Debentures;
(v) The undersigned is not acquiring Debentures with a view
to distribution thereof or with any present intention of offering or selling
Debentures or the Common Stock issuable upon conversion thereof, except as
permitted below; provided that the disposition of the undersigned's property
and property of any accounts for which the undersigned is acting as
fiduciary shall remain at all times within the undersigned's control; and
(vi) The undersigned has received a copy of the Offering
Memorandum and acknowledges that the undersigned has access to such
financial and other information, and has been afforded the opportunity to
ask such questions of representatives of the Company and receive answers
thereto, as the undersigned deems necessary in connection with its decision
to purchase the Debentures.
The undersigned understands that the Debentures are being offered
in a transaction not involving any public offering within the United States
within the meaning of the Securities Act and that the Debentures and the
shares of Common Stock issuable upon conversion thereof (collectively, the
"Securities") have not been registered under the Securities Act or any
applicable state securities laws, and the undersigned agrees, on its own
behalf and on behalf of each account for which the undersigned acquires any
Securities, that if in the future the undersigned decides to resell or
otherwise transfer such Securities, such Securities may be resold or
otherwise transferred only (a) to the Company or any subsidiary thereof, (b)
inside the United States to a person who is a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act) in a transaction
meeting the requirements of Rule 144A, (c) inside the United States to an
Institutional Accredited Investor that, prior to such transfer, furnishes to
the trustee (or transfer agent, as the case may be) for such Securities a
signed letter containing certain representations and agreements relating to
the restrictions on transfer of such Securities (the form of which letter
can be obtained from such trustee, or transfer agent, as the case may be),
(d) outside the United States in a transaction meeting the requirements of
Rule 904 under the Securities Act, (e) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act (if applicable)
or (f) pursuant to a registration statement which has been declared
effective under the Securities Act. The undersigned agrees that any such
transfer of Securities referred to in this paragraph shall be in accordance
with applicable securities laws of any State of the United States or any
B-2
other applicable jurisdiction and in accordance with the legends set forth
on the Securities. The undersigned further agrees to provide any person
purchasing any of the Securities from the undersigned a notice advising such
purchaser that resales of such securities are restricted as stated herein
(unless the sale of securities has been registered under the Securities
Act). The undersigned understands that the registrar and transfer agent for
the Securities will not be required to accept for registration of transfer
any Securities, except upon presentation of evidence satisfactory to the
Company that the foregoing restrictions on transfer have been complied with.
The undersigned further understands that any Securities will be in the form
of definitive physical certificates and that such certificates will bear a
legend (unless the sale of the Securities has been registered under the
Securities Act) reflecting the substance of this paragraph.
The undersigned acknowledges that the Company, others and you will
rely upon the undersigned's confirmations, acknowledgements and agreements
set forth herein, and the undersigned agrees to notify you promptly in
writing if any of its representations or warranties herein ceases to be
accurate and complete.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK.
(Name of Purchaser)
By:
Name:
Title:
Address:
B-3
EXHIBIT C
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM RESTRICTED GLOBAL SECURITY TO REGULATION S GLOBAL SECURITY
(Pursuant to Section 2.5(b)(2), (4) or (8) of the Indenture)
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Global Trust Services
(Comverse Technology, Inc. 5-3/4% Convertible Subordinated
Securities due 2006)
Dear Ladies and Gentlemen:
Reference is hereby made to the Indenture, dated as of October 4,
1996 (the "Indenture"), between Comverse Technology, Inc., as issuer (the
"Company") and The Chase Manhattan Bank, as trustee. Capitalized terms used
but not defined herein shall have the meanings given to them in the
Indenture.
This letter relates to U.S. $______________ principal amount of
Securities which are evidenced by one or more Restricted Global Securities
and held with the Depositary in the name of ________________ (the
"Transferor"). The Transferor has requested a transfer of such beneficial
interest in the Securities to a Person who will take delivery thereof in the
form of an equal principal amount of Securities evidenced by one or more
Regulation S Global Securities, which amount, immediately after such
transfer, is to be held with the Depositary through Euroclear or CEDEL or
both.
In connection with such request and in respect of such Securities,
the Transferor hereby certifies that such transfer has been effected in
compliance with the transfer restrictions applicable to the Securities and
pursuant to and in accordance with Rule 903 or Rule 904 under the United
States Securities Act of 1933, as amended (the "Securities Act"), and
accordingly the Transferor hereby further certifies that:
(1) The offer of the Securities was not made to a person in the
United States;
C-1
(2) either:
(a) at the time the buy order was originated, the transferee
was outside the United States or the Transferor and any
person acting on its behalf reasonably believed and
believes that the transferee was outside the United
States; or
(b) the transaction was executed in, on or through the
facilities of a designated offshore securities market
and neither the Transferor nor any person acting on its
behalf knows that the transaction was prearranged with a
buyer in the United States;
(3) no directed selling efforts have been made in contravention
of the requirements of Rule 904(b) of Regulation S;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
(5) upon completion of the transaction, the beneficial interest
being transferred as described above is to be held with the
Depositary through Euroclear or CEDEL or both.
(6) With respect to transfers made in reliance on Rule 144, the
Securities are being transferred in a transaction permitted
by Rule 144 under the Securities Act; and with respect to
transfer made in reliance on Rule 144A, that such Securities
are being transferred in accordance with Rule 144A under the
Securities Act to a transferee that the Transferor reasonably
believes is purchasing the Securities for its own account or
an account with respect to which the transferee exercises
sole investment discretion and the transferee and any such
account is a "qualified institutional buyer" within the
meaning of Rule 144A, in a transaction meeting the
requirements of Rule 144A and in accordance with applicable
securities laws of any state of the United States or any
other jurisdiction.
In addition, if the sale is made during a restricted period and
the provisions of Rule 903(c)(2) or (3) or Rule 904(c)(1) of Regulation
S are applicable thereto, we confirm that such sale has been made in
accordance with the applicable provisions of Rule 903(c)(2) or (3) or
Rule 904(c)(1), as the case may be.
C-2
Upon giving effect to this request to exchange a beneficial
interest in a Restricted Global Security for a beneficial interest in a
Regulation S Global Security, the resulting beneficial interest shall
be subject to the restrictions on transfer application to Regulation S
Global Securities pursuant to the Indenture and the Securities Act.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company and the Initial Purchaser,
and you and each of them is entitled to rely on the contents of this
certificate. Terms used in this certificate and not otherwise defined
in the Indenture have the meanings set forth in Regulation S under the
Securities Act.
[Insert Name of Transferor]
By:
Name:
Title:
Dated:____________________, __
C-3
EXHIBIT D
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM REGULATION S GLOBAL SECURITY
TO RESTRICTED GLOBAL SECURITY
(Pursuant to Section 2.5(b)(3), (5) or (8) of the Indenture)
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Global Trust Services (Comverse Technology, Inc. 5-3/4%
Convertible Subordinated Securities due 2006)
Dear Ladies and Gentlemen:
Reference is hereby made to the Indenture, dated as of October 4,
1996 (the "Indenture"), between Comverse Technology, Inc., as issuer (the
"Company") and The Chase Manhattan Bank, as trustee. Capitalized terms used
but not defined herein shall have the meanings given to them in the
Indenture.
This letter relates to U.S. $____________________ principal amount
of Securities which are evidenced by one or more Regulation S Global
Securities and held with the Depositary through [Euroclear] [CEDEL] in the
name of __________________ (the "Transferor"). The Transferor has requested
a transfer of such beneficial interest in the Securities to a Person who
will take delivery thereof in the form of an equal principal amount of
Securities evidenced by one or more Restricted Global Securities, to be held
with the Depositary.
In connection with such request and in respect of such Securities,
the Transferor hereby certifies that:
[CHECK ONE]
|_| such transfer is being effected pursuant to and in accordance with
Rule 144A under the United States Securities Act of 1933, as
amended (the "Securities Act"), and, accordingly, the Transferor
hereby further certifies that the Securities are being transferred
to a Person that the Transferor reasonably believes is purchasing
the Securities for its own account, or for one or more
D-1
accounts with respect to which such person exercises sole
investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A in
a transaction meeting the requirements of Rule 144A;
or
|_| such transfer is being effected pursuant to and in accordance with
Rule 144 under the Securities Act;
or
|_| such transfer is being effected pursuant to an effective
registration statement under the Securities Act;
or
|_| such transfer is being effected pursuant to an exemption from the
registration requirements of the Securities Act other than Rule
144A or Rule 144, and the Transferor hereby further certifies that
the Securities are being transferred in compliance with the
transfer restrictions applicable to the Securities and in
accordance with the requirements of the exemption claimed, which
certification is supported by such legal opinions or other
information provided by the Transferor or the transferee (a copy
of which the Transferor has attached to this certification) in
form reasonably acceptable to the Company, to the effect that such
transfer is in compliance with the Securities Act;
and such Securities are being transferred in compliance with any applicable
blue sky securities laws of any state of the United States.
Upon giving effect to this request to exchange a beneficial
interest in Regulation S Global Securities for a beneficial interest in
Restricted Global Securities, the resulting beneficial interest shall be
subject to the restrictions on transfer applicable to Restricted Global
Securities pursuant to the Indenture and the Securities Act.
D-2
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company and the Initial Purchaser, and
you and each of them is entitled to rely on the contents of this
certificate. Terms used in this certificate and not otherwise defined in the
Indenture have the meanings set forth in Regulation S under the Securities
Act.
[Insert Name of Transferor]
By:
Name:
Title:
Dated:____________________, ___
D-3
