EXHIBIT 4.1
Execution Copy
LABORATORY CORPORATION OF AMERICA HOLDINGS
Liquid Yield Option(TM) Notes
due 2021
(Zero Coupon - Subordinated)
----------------------------------------------------------
INDENTURE
Dated as of September 11, 2001
----------------------------------------------------------
THE BANK OF NEW YORK
TRUSTEE
----------------------------------------------------------
(TM)Xxxxxxx Xxxxx & Co., Inc.
CROSS REFERENCE TABLE*
TIA Section............................................ Indenture Section
310(a)(1).............................................. 7.10
(a)(2)............................................ N.A.
(a)(3)............................................ N.A.
(a)(4)............................................ N.A.
(b)............................................... 7.10
(c)............................................... N.A.
311(a)................................................. 7.11
(b)............................................... 7.11
(c)............................................... N.A.
312(a)................................................. N.A.
(b)............................................... 15.03
(c)............................................... 15.03
313(a)................................................. 7.06
(b)............................................... 7.06
(c)............................................... N.A.
(d)............................................... 7.06
314(a)................................................. 4.02
(b)............................................... N.A.
(c)............................................... N.A.
(d)............................................... N.A.
(e)............................................... N.A.
(f)............................................... N.A.
315(a)................................................. 7.01
(b)............................................... 7.05
(c)............................................... N.A.
(d)............................................... 7.01
(e)............................................... 6.11
316(a)(1)(A)........................................... 6.05
(a)(1)(B)......................................... 6.04
(a)(2)............................................ N.A.
(b)............................................... N.A.
N.A. means Not Applicable.
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* Note: This Cross Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
TABLE OF CONTENTS*
Page
Table of Contents
Page
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions....................................................1
Section 1.02 Other Definitions..............................................5
Section 1.03 Incorporation by Reference of Trust Indenture Act..............7
Section 1.04 Rules of Construction..........................................7
Section 1.05 Acts of Holders................................................7
ARTICLE 2
THE SECURITIES
Section 2.01 Form and Dating................................................9
Section 2.02 Execution and Authentication..................................10
Section 2.03 Registrar, Paying Agent, Conversion Agent, Bid
Solicitation Agent and Rate Solicitation Agent................11
Section 2.04 Paying Agent to Hold Money and Securities in Trust............11
Section 2.05 Securityholder Lists..........................................11
Section 2.06 Transfer and Exchange.........................................12
Section 2.07 Replacement Securities........................................13
Section 2.08 Outstanding Securities; Determinations of Holders' Action.....14
Section 2.09 Temporary Securities..........................................15
Section 2.10 Cancellation..................................................15
Section 2.11 Persons Deemed Owners.........................................15
Section 2.12 Global Securities.............................................16
Section 2.13 CUSIP Numbers.................................................18
ARTICLE 3
REDEMPTION AND PURCHASES
Section 3.01 Right to Redeem; Notices to Trustee...........................18
Section 3.02 Selection of Securities to Be Redeemed........................18
Section 3.03 Notice of Redemption..........................................19
Section 3.04 Effect of Notice of Redemption................................19
Section 3.05 Deposit of Redemption Price...................................20
Section 3.06 Securities Redeemed in Part...................................20
Section 3.07 Conversion Arrangement on Call for Redemption.................20
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*Note: This Table of Contents shall not, for any purpose, be deemed to be
part of the Indenture.
i
Section 3.08 Purchase of Securities at Option of the Holder................21
Section 3.09 Purchase of Securities at Option of the Holder
upon Change in Control........................................27
Section 3.10 Effect of Purchase Notice or Change in Control
Purchase Notice...............................................30
Section 3.11 Deposit of Purchase Price or Change in Control Purchase
Price.........................................................31
Section 3.12 Securities Purchased in Part..................................31
Section 3.13 Covenant to Comply with Securities Laws upon Purchase
of Securities.................................................31
Section 3.14 Repayment to the Company......................................32
ARTICLE 4
COVENANTS
Section 4.01 Payment of Securities.........................................32
Section 4.02 SEC and Other Reports.........................................33
Section 4.03 Compliance Certificate........................................33
Section 4.04 Further Instruments and Acts..................................33
Section 4.05 Maintenance of Office or Agency...............................33
Section 4.06 Delivery of Certain Information...............................34
Section 4.07 Tax Matters...................................................34
ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01 When Company May Merge or Transfer Assets.....................35
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default.............................................36
Section 6.02 Acceleration..................................................37
Section 6.03 Other Remedies................................................38
Section 6.04 Waiver of Past Defaults.......................................38
Section 6.05 Control by Majority...........................................38
Section 6.06 Limitation on Suits...........................................39
Section 6.07 Rights of Holders to Receive Payment..........................39
Section 6.08 Collection Suit by Trustee....................................39
Section 6.09 Trustee May File Proofs of Claim..............................39
Section 6.10 Priorities....................................................40
Section 6.11 Undertaking for Costs.........................................41
Section 6.12 Waiver of Stay, Extension or Usury Laws.......................41
ARTICLE 7
TRUSTEE
Section 7.01 Duties of Trustee.............................................41
Section 7.02 Rights of Trustee.............................................42
Section 7.03 Individual Rights of Trustee..................................44
Section 7.04 Trustee's Disclaimer..........................................44
ii
Section 7.05 Notice of Defaults............................................44
Section 7.06 Reports by Trustee to Holders.................................44
Section 7.07 Compensation and Indemnity....................................44
Section 7.08 Replacement of Trustee........................................45
Section 7.09 Successor Trustee by Merger...................................46
Section 7.10 Eligibility; Disqualification.................................46
Section 7.11 Preferential Collection of Claims Against Company.............46
ARTICLE 8
DISCHARGE OF INDENTURE
Section 8.01 Discharge of Liability on Securities..........................46
Section 8.02 Repayment to the Company......................................46
ARTICLE 9
AMENDMENTS
Section 9.01 Without Consent of Holders....................................47
Section 9.02 With Consent of Holders.......................................47
Section 9.03 Compliance with Trust Indenture Act...........................48
Section 9.04 Revocation and Effect of Consents, Waivers and Actions........48
Section 9.05 Notation on or Exchange of Securities.........................48
Section 9.06 Trustee to Sign Supplemental Indentures.......................49
Section 9.07 Effect of Supplemental Indentures.............................49
ARTICLE 10
CONVERSION
Section 10.01 Conversion Privilege.........................................49
Section 10.02 Conversion Procedure.........................................50
Section 10.03 Fractional Shares............................................51
Section 10.04 Taxes on Conversion..........................................52
Section 10.05 Company to Provide Stock.....................................52
Section 10.06 Adjustment for Change in Capital Stock.......................52
Section 10.07 Adjustment for Rights Issue..................................53
Section 10.08 Adjustment for Other Distributions...........................54
Section 10.09 When Adjustment May Be Deferred..............................57
Section 10.10 When No Adjustment Required..................................57
Section 10.11 Notice of Adjustment.........................................57
Section 10.12 Voluntary Increase...........................................57
Section 10.13 Notice of Certain Transactions...............................58
Section 10.14 Reorganization of Company; Special Distributions.............58
Section 10.15 Company Determination Final..................................59
Section 10.16 Trustee's Adjustment Disclaimer..............................59
Section 10.17 Simultaneous Adjustments.....................................59
Section 10.18 Successive Adjustments.......................................59
Section 10.19 Rights Issued in Respect of Common Stock Issued
Upon Conversion..............................................59
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ARTICLE 11
SUBORDINATION
Section 11.01 Securities Subordinate to Senior Indebtedness................60
Section 11.02 Payment over of Proceeds upon Dissolution, Etc...............60
Section 11.03 Acceleration of Securities...................................61
Section 11.04 Default on Senior Indebtedness...............................62
Section 11.05 Payment Permitted if No Default..............................63
Section 11.06 Subrogation to Rights of Holders of Senior Indebtedness......63
Section 11.07 Provisions Solely to Define Relative Rights..................63
Section 11.08 Trustee to Effectuate Subordination..........................64
Section 11.09 No Waiver of Subordination Provisions........................64
Section 11.10 Notice to Trustee............................................64
Section 11.11 Reliance on Judicial Order or Certificate of
Liquidating Agent............................................65
Section 11.12 Trustee Not Fiduciary for Holders of Senior Indebtedness.....65
Section 11.13 Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights.............................65
Section 11.14 Article 11 Applicable to Paying Agents.......................66
ARTICLE 12
PAYMENT OF INTEREST
Section 12.01 Interest Payments............................................66
Section 12.02 Defaulted Interest...........................................66
Section 12.03 Interest Rights Preserved....................................67
ARTICLE 13
CONTINGENT CASH INTEREST
Section 13.01 Contingent Cash Interest.....................................67
Section 13.02 Payment of Contingent Cash Interest; Contingent Cash
Interest Rights Preserved....................................68
Section 13.03 Bid Solicitation Agent.......................................69
ARTICLE 14
CONTINGENT ADDITIONAL PRINCIPAL
Section 14.01 Contingent Additional Principal..............................69
Section 14.02 Payment of Contingent Additional Principal...................71
Section 14.03 Notice.......................................................71
Section 14.04 Rate Solicitation Agent......................................71
ARTICLE 15
MISCELLANEOUS
Section 15.01 Trust Indenture Act Controls.................................72
iv
Section 15.02 Notices......................................................72
Section 15.03 Communication by Holders with Other Holders..................73
Section 15.04 Certificate and Opinion as to Conditions Precedent...........73
Section 15.05 Statements Required in Certificate or Opinion................73
Section 15.06 Separability Clause..........................................73
Section 15.07 Rules by Trustee, Paying Agent, Conversion Agent and
Registrar....................................................73
Section 15.08 Calculations.................................................74
Section 15.09 Legal Holidays...............................................74
Section 15.10 GOVERNING LAW................................................74
Section 15.11 No Recourse Against Others...................................74
Section 15.12 Successors...................................................74
Section 15.13 Multiple Originals...........................................74
v
INDENTURE dated as of September 11, 2001 between LABORATORY
CORPORATION OF AMERICA HOLDINGS, a Delaware corporation ("Company"), and THE
BANK OF NEW YORK, a New York banking corporation ("Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the Holders of the Company's Liquid Yield
Option(TM) Notes due 2021 (Zero Coupon - Subordinated) (each a "Security" and,
collectively, the "Securities"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
"144A Global Security" means a permanent Global Security in the form
of the Security attached hereto as Exhibit A-1, and that is deposited with and
registered in the name of the Depositary, representing Securities sold in
reliance on Rule 144A under the Securities Act.
"Accrued Original Issue Discount" of any Security represents the
accrued portion of Original Issue Discount, including the accrued portion of
CAP-OID.
"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 or cause the direction of 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.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Security, in each case to the
extent applicable to such transaction and as in effect from time to time.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of such board.
"Business Day" means each day of the year other than a Saturday or a
Sunday or other day on which banking institutions in The City of New York are
required or authorized to close.
"Capital Stock" for any corporation means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) stock or other equity
issued by that corporation.
"CAP-OID" means Original Issue Discount in respect of Contingent
Additional Principal.
"Cash" or "cash" means such coin or currency of The United States of
America as at any time of payment is legal tender for the payment of public and
private debts.
"Common Stock" means the shares of Common Stock, $0.10 par value, as
it exists on the date of this Indenture of the Company or any other shares of
Capital Stock of the Company into which the Common Stock shall be reclassified
or changed.
"Company" means the party named as the "Company" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by any two Officers.
"Contingent Additional Principal" means such additional principal
payable on the Securities, if any, as described in Section 14.01.
"Contingent Cash Interest" means such cash interest payable as
described in Section 13.01.
"Corporate Trust Office" means the principal office of the Trustee at
which at any time its corporate trust business shall be administered, which
office at the date hereof is located at 000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust Administration, or such other
address as the Trustee may designate from time to time by notice to the
Company, or the principal corporate trust office of any successor Trustee (or
such other address as a successor Trustee may designate from time to time by
notice to the Company).
"Debt" means with respect to the Company at any date, without
duplication, obligations (other than nonrecourse obligations) for borrowed
money or evidenced by bonds, debentures, notes or similar instruments.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Exchange Act" means the Exchange Act of 1934, as amended from time to
time.
"Global Securities" means Securities that are in the form of the
Securities attached hereto as Exhibit A-1, and to the extent that such
Securities are required to bear the Legend required by Section 2.06, such
Securities will be in the form of a 144A Global Security.
"Holder" or "Securityholder" means a person in whose name a Security
is registered on the Registrar's books.
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof, including the provisions of the
TIA that are deemed to be a part hereof.
"Issue Date" of any Security means the date on which the Security was
originally issued or deemed issued as set forth on the face of the Security.
2
"Issue Price" of any Security means, in connection with the original
issuance of such Security, the initial issue price at which the Security is
sold as set forth on the face of the Security.
"Officer" means the Chairman of the Board, the Vice Chairman, the
Chief Executive Officer, the President, any Executive Vice President, any
Senior Vice President, any Vice President, the Treasurer or the Secretary or
any Assistant Treasurer or Assistant Secretary of the Company.
"Officers' Certificate" means a written certificate containing the
information specified in Sections 15.04 and 15.05, signed in the name of the
Company by any two Officers, and delivered to the Trustee. An Officers'
Certificate given pursuant to Section 3.08 shall be signed by the principal
executive financial or accounting Officer of the Company but need not contain
the information specified in Sections 15.04 and 15.05.
"Opinion of Counsel" means a written opinion containing the
information specified in Sections 15.04 and 15.05, from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of, or counsel to,
the Company or the Trustee.
"Original Issue Discount" of any Security means the amount that
accrues in respect of such Security daily at a rate of 2.0% per year on the
Issue Price plus any previously accrued amounts beginning on the Issue Date,
together with the amount that accrues on any accrued Contingent Additional
Principal daily at such rate. Original Issue Discount will be calculated on a
semi-annual bond equivalent basis, using a 360-day year comprised of twelve
30-day months.
"person" or "Person" means any individual, corporation, limited
liability company, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, or government or any agency or
political subdivision thereof.
"Principal Amount at Maturity" of a Security means the principal
amount at maturity as set forth on the face of the Security.
"Redemption Date" or "redemption date" means the date specified for
redemption of the Securities in accordance with the terms of the Securities and
this Indenture.
"Redemption Price" or "redemption price" has the meaning set forth in
paragraph 6 of the Securities.
"Responsible Officer" means, when used with respect to the Trustee,
any officer within the corporate trust department of the Trustee, including any
vice president, assistant vice president, assistant secretary, trust officer or
any other officer of the Trustee who customarily performs functions similar to
those performed by the Persons who at the time shall be such officers,
respectively, or to whom any corporate trust matter is referred because of such
person's knowledge of and familiarity with the particular subject and who, in
each case, shall have direct responsibility for the administration of this
Indenture.
"Restricted Security" means a Security required to bear the
restrictive Legend set forth in the form of Securities set forth in Exhibit A-1
of this Indenture.
3
"Rule 144A" means Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.
"Sale Price" of Capital Stock on any date means the closing per share
sale price (or, if no closing sale price is reported, the average of the bid
and ask prices or, if more than one in either case, the average of the average
bid and the average ask prices) on such date as reported in composite
transactions for the principal United States securities exchange on which the
Capital Stock is traded or, if the Capital Stock is not listed on a United
States national or regional securities exchange, as reported by the National
Association of Securities Dealers Automated Quotation System or by the National
Quotation Bureau Incorporated. In the absence of such quotation, the Company
shall be entitled to determine the Sale Price on the basis of such quotations
as it considers appropriate.
"SEC" means the Securities and Exchange Commission.
"Securities" means any of the Company's Liquid Yield Option(TM) Notes
due 2021 (Zero Coupon-Subordinated), as amended or supplemented from time to
time, issued under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended from
time to time.
"Securityholder" or "Holder" means a person in whose name a Security
is registered on the Registrar's books.
"Senior Indebtedness" means the principal, premium (if any) and unpaid
interest on all present and future (i) indebtedness of the Company for borrowed
money; (ii) obligations of the Company evidenced by bonds, debentures, notes or
similar instruments; (iii) obligations of the Company under (a) interest rate
swaps, caps, collars, options and similar arrangements, (b) any foreign
exchange contract, currency swap contract, futures contract, currency option
contract, or other foreign currency hedge and (c) credit swaps, caps, floors,
collars and similar arrangements; (iv) indebtedness incurred, assumed or
guaranteed by the Company in connection with the acquisition by it or a
subsidiary of the Company of any business, properties or assets (except
purchase-money indebtedness classified as accounts payable under U.S. generally
accepted accounting principles); (v) all obligations and liabilities
(contingent or otherwise) in respect of leases of the Company required, in
conformity with U.S. generally accepted accounting principles, to be accounted
for as capitalized lease obligations on the balance sheet of the Company and
all obligations and liabilities (contingent or otherwise) under any lease or
related document (including a purchase agreement) in connection with the lease
or real property which provides that the Company is contractually obligated to
purchase or cause a third party to purchase the leased property and thereby
guarantee a minimum residual value of the leased property to the lessor and the
obligations of the Company under such lease or related document to purchase or
to cause a third party to purchase such leased property; (vi) reimbursement
obligations of the Company in respect of letters of credit relating to
indebtedness or other obligations of the Company that qualify as indebtedness
or obligations of the kind referred to in clauses (i) through (v) above; and
(vii) obligations of the Company under direct or indirect guaranties in respect
of, and obligations (contingent or otherwise) to purchase or otherwise acquire,
or otherwise to assure a creditor against loss in respect of, indebtedness or
obligations of
4
others of the kinds referred to in clauses (i) through (vi) above, in each case
unless in the instrument creating or evidencing the indebtedness or obligation
or pursuant to which the same is outstanding it is provided that (x) such
indebtedness or obligation is not senior in right of payment to the Securities
or (y) such indebtedness or obligation is subordinated to any other
indebtedness or obligation of the Company, unless such indebtedness or
obligation expressly provides that such indebtedness or obligations be senior
in right of payment to the Securities.
"Significant Subsidiary", has the meaning set forth in Rule 1-02 of
Regulation S-X under the Securities Act.
"Special Record Date" means for the payment of any Defaulted Interest,
the date fixed by the Trustee pursuant to Section 12.02.
"Stated Maturity", when used with respect to any Security, means the
date specified in such Security as the fixed date on which an amount equal to
the Principal Amount at Maturity and any Contingent Additional Principal (and
CAP-OID) thereon, if any, of such Security is due and payable.
"Subsidiary" means (i) a corporation, a majority of whose Capital
Stock with voting power, under ordinary circumstances, to elect directors is,
at the date of determination, directly or indirectly owned by the Company, by
one or more Subsidiaries of the Company or by the Company and one or more
Subsidiaries of the Company, (ii) a partnership in which the Company or a
Subsidiary of the Company holds a majority interest in the equity capital or
profits of such partnership, or (iii) any other person (other than a
corporation or a partnership) in which the Company, a Subsidiary of the Company
or the Company and one or more Subsidiaries of the Company, directly or
indirectly, at the date of determination, has (x) at least a majority ownership
interest or (y) the power to elect or direct the election of a majority of the
directors or other governing body of such person.
"TIA" means the Trust Indenture Act of 1939 as in effect on the date
of this Indenture, provided, however, that in the event the TIA is amended
after such date, TIA means, to the extent required by any such amendment, the
TIA as so amended.
"trading day" means a day during which trading in securities generally
occurs on the New York Stock Exchange or, if the Common Stock is not listed on
the New York Stock Exchange, on the principal other national or regional
securities exchange on which the Common Stock is then listed or, if the Common
Stock is not listed on a national or regional securities exchange, on the
National Association of Securities Dealers Automated Quotation System or, if
the Common Stock is not quoted on the National Association of Securities
Dealers Automated Quotation System, on the principal other market on which the
Common Stock is then traded.
"Trustee" means the party named as the "Trustee" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
Section 1.02 Other Definitions.
5
Term Defined in Section
---- ------------------
"Adjusted Rate"............................................................14.01
"Act"....................................................................1.05(a)
"Agent Members"..........................................................2.12(e)
"Associate"..............................................................3.09(a)
"Average Sale Price".......................................................10.01
"Bankruptcy Law"............................................................6.01
"beneficial owner".......................................................3.09(a)
"Bid Solicitation Agent"....................................................2.03
"Change in Control"......................................................3.09(a)
"Change in Control Purchase Date"........................................3.09(a)
"Change in Control Purchase Notice"......................................3.09(c)
"Change in Control Purchase Price".......................................3.09(a)
"Common Stock Record Date" ................................................13.01
"Company Notice".........................................................3.08(e)
"Company Notice Date"....................................................3.08(c)
"Contingent Cash Interest Payment Date"....................................13.02
"Contingent Cash Interest Record Date".....................................13.02
"Conversion Agent"..........................................................2.03
"Conversion Date"..........................................................10.02
"Conversion Rate"..........................................................10.01
"Custodian".................................................................6.01
"Defaulted Interest".......................................................12.02
"Depositary".............................................................2.01(a)
"DTC"....................................................................2.01(a)
"Event of Default"..........................................................6.01
"Ex-Dividend Date"......................................................10.08(b)
"Ex-Dividend Time".........................................................10.01
"Extraordinary Cash Dividend"...........................................10.08(a)
"Five-Trading-Day Measurement Period"......................................13.01
"Institutional Accredited Investors".....................................2.01(b)
"Legal Holiday"............................................................15.09
"Legend".................................................................2.06(f)
"XXXXx Market Price".......................................................13.01
"Market Price"...........................................................3.08(d)
"Measurement Period"....................................................10.08(a)
"Notice of Default".........................................................6.01
"Paying Agent"..............................................................2.03
"Post-Distribution Price"...............................................10.08(b)
"Purchase Date"..........................................................3.08(a)
"Purchase Notice"........................................................3.08(a)
"Purchase Price".........................................................3.08(a)
"QIBs"...................................................................2.01(a)
"Rate Solicitation Agent"...................................................2.03
"Registrar".................................................................2.03
"Relevant Cash Dividends"...............................................10.08(a)
6
"Relevant Value"...........................................................13.01
"Rights"...................................................................10.19
"Rights Agreement".........................................................10.19
"Rule 144A Information".....................................................4.06
"Subordinated Debt Rate"...................................................14.01
"Stock Price Factor".......................................................14.01
"Time of Determination"....................................................10.01
Section 1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"Indenture securities" means the Securities.
"Indenture security holder" means a Securityholder.
"Indenture to be qualified" means this Indenture.
"Indenture trustee" or "institutional trustee" means the Trustee.
"Obligor" on the indenture securities means the Company.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have
the meanings assigned to them by such definitions.
Section 1.04 Rules of Construction. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with United States generally accepted accounting
principles as in effect from time to time;
(3) "or" is not exclusive;
(4) "including" means including, without limitation; and
(5) words in the singular include the plural, and words in the plural
include the singular.
Section 1.05 Acts of Holders. (a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture
to be given or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agent xxxx appointed in writing; and, except as herein
7
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and conclusive in favor
of the Trustee and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to such officer the execution thereof.
Where such execution is by a signer acting in a capacity other than such
signer's individual capacity, such certificate or affidavit shall also
constitute sufficient proof of such signer's authority. The fact and date of
the execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner, which the Trustee
deems sufficient.
(c) The ownership of Securities shall be proved by the register
maintained by the Registrar.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future
Holder of the same Security and the holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made
upon such Security.
(e) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company
may, at its option, by or pursuant to a resolution of the Board of Directors,
fix in advance a record date for the determination of Holders entitled to give
such request, demand, authorization, direction, notice, consent, waiver or
other Act, but the Company shall have no obligation to do so. If such a record
date is fixed, such request, demand, authorization, direction, notice, consent,
waiver or other Act may be given before or after such record date, but only the
Holders of record at the close of business on such record date shall be deemed
to be Holders for the purposes of determining whether Holders of the requisite
proportion of outstanding Securities have authorized or agreed or consented to
such request, demand, authorization, direction, notice, consent, waiver or
other Act, and for that purpose the outstanding Securities shall be computed as
of such record date; provided that no such authorization, agreement or consent
by the Holders on such record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later than
six months after the record date.
8
ARTICLE 2
THE SECURITIES
Section 2.01 Form and Dating. The Securities and the Trustee's
certificate of authentication shall be substantially in the form of Exhibits
A-1, which is a part of this Indenture. The Securities may have notations,
legends or endorsements required by law, stock exchange rule or usage (provided
that any such notation, legend or endorsement required by usage is in a form
acceptable to the Company). The Company shall provide any such notations,
legends or endorsements to the Trustee in writing. Each Security shall be dated
the date of its authentication.
(a) 144A Global Securities. Securities offered and sold within the
United States to "qualified institutional buyers" as defined in Rule 144A
("QIBs") in reliance on Rule 144A shall be issued, initially in the form of a
144A Global Security, which shall be deposited with the Trustee at its
Corporate Trust Office, as custodian for the Depositary and registered in the
name of The Depository Trust Company ("DTC") or the nominee thereof (such
depositary, or any successor thereto, and any such nominee being hereinafter
referred to as the "Depositary"), duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate Principal
Amount at Maturity of the 144A Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Trustee and
the Depositary as hereinafter provided.
(b) Certificated Securities. Except as provided in Section 2.12,
owners of beneficial interests in Global Securities will not be entitled to
receive physical delivery of Securities in definitive form.
(c) Global Securities in General. Each Global Security shall represent
such of the outstanding Securities as shall be specified therein and each shall
provide that it shall represent the aggregate Principal Amount at Maturity of
outstanding Securities from time to time endorsed thereon and that the
aggregate Principal Amount at Maturity of outstanding Securities represented
thereby may from time to time be reduced or increased, as appropriate, to
reflect exchanges, redemptions and conversions.
Any adjustment of the aggregate Principal Amount at Maturity of a
Global Security to reflect the amount of any increase or decrease in the
Principal Amount at Maturity of outstanding Securities represented thereby
shall be made by the Trustee in accordance with instructions given by the
Holder thereof as required by Section 2.12 hereof and shall be made on the
records of the Trustee and the Depositary.
(d) Book-Entry Provisions. This Section 2.01(d) shall apply only to
Global Securities deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.01(d), authenticate and deliver initially one or more Global
Securities that (a) shall be registered in the name of the Depositary, (b)
shall be delivered by the Trustee to the Depositary or pursuant to the
Depositary's instructions and (c) shall bear legends substantially to the
following effect:
9
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS, IN
WHOLE BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR
TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF."
Section 2.02 Execution and Authentication. The Securities shall be
executed on behalf of the Company by any Officer. The signature of the Officer
on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of an individual
who was at the time of the execution of the Securities the proper Officer of
the Company shall bind the Company, notwithstanding that such individual has
ceased to hold such office prior to the authentication and delivery of such
Securities or did not hold such office at the date of authentication of such
Securities.
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
duly executed by the Trustee by manual signature of an authorized Officer, and
such certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
The Trustee shall authenticate and deliver Securities for original
issue in an aggregate Principal Amount at Maturity of up to $650,000,000
(744,000,000 aggregate Principal Amount at Maturity, if the over-allotment
option granted to the initial purchaser of the Securities is exercised in full)
upon a Company Order without any further action by the Company. The aggregate
Principal Amount at Maturity of Securities outstanding at any time may not
exceed the amount set forth in the foregoing sentence, except as provided in
Section 2.07.
The Securities shall be issued only in registered form without coupons
and only in denominations of $1,000 of Principal Amount at Maturity and any
integral multiple thereof.
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Section 2.03 Registrar, Paying Agent, Conversion Agent, Bid
Solicitation Agent and Rate Solicitation Agent. The Company shall maintain an
office or agency where Securities may be presented for registration of transfer
or for exchange ("Registrar"), an office or agency where Securities may be
presented for purchase or payment ("Paying Agent") and an office or agency
where Securities may be presented for conversion ("Conversion Agent"). The
Company shall also appoint a bid solicitation agent (the "Bid Solicitation
Agent") to act pursuant to Section 13.03 hereof and paragraph 3 of the
Securities and a rate solicitation agent ("Rate Solicitation Agent") to act
pursuant to Section 14.04 and paragraph 5.B of the Securities. The Registrar
shall keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars, one or more additional paying
agents and one or more additional conversion agents. The term Paying Agent
includes any additional paying agent, including any named pursuant to Section
4.05. The term Conversion Agent includes any additional conversion agent,
including any named pursuant to Section 4.05.
The Company shall enter into an appropriate agency agreement with any
Registrar or co-registrar, Paying Agent, Conversion Agent, Bid Solicitation
Agent or Rate Solicitation Agent (other than the Trustee). The agreement shall
implement the provisions of this Indenture that relate to such agent. The
Company shall notify the Trustee of the name and address of any such agent. If
the Company fails to maintain a Registrar, Paying Agent, Conversion Agent, Rate
Solicitation Agent, or Bid Solicitation Agent, the Trustee shall act as such
and shall be entitled to appropriate compensation therefor pursuant to Section
7.07. The Company or any Subsidiary or an Affiliate of either of them may act
as Paying Agent, Registrar, Conversion Agent or co-registrar. None of the
Company or any Subsidiary or any Affiliate of any of them may act as Bid
Solicitation Agent or Rate Solicitation Agent.
The Company initially appoints the Trustee as Registrar, Conversion
Agent, Paying Agent, Rate Solicitation Agent and Bid Solicitation Agent in
connection with the Securities.
Section 2.04 Paying Agent to Hold Money and Securities in Trust.
Except as otherwise provided herein, not later than 10:00 a.m., New York City
time, on each due date of payments in respect of any Security, the Company
shall deposit with the Paying Agent a sum of money (in immediately available
funds if deposited on the due date) or Common Stock sufficient to make such
payments when so becoming due. The Company shall require each Paying Agent
(other than the Trustee) to agree in writing that the Paying Agent shall hold
in trust for the benefit of Securityholders or the Trustee all money and Common
Stock held by the Paying Agent for the making of payments in respect of the
Securities and shall notify the Trustee of any default by the Company in making
any such payment. At any time during the continuance of any such default, the
Paying Agent shall, upon the written request of the Trustee, forthwith pay to
the Trustee all money and Common Stock so held in trust. If the Company, a
Subsidiary or an Affiliate of either of them acts as Paying Agent, it shall
segregate the money and Common Stock held by it as Paying Agent and hold it as
a separate trust fund. The Company at any time may require a Paying Agent to
pay all money and Common Stock held by it to the Trustee and to account for any
funds and Common Stock disbursed by it. Upon doing so, the Paying Agent shall
have no further liability for the money or Common Stock.
Section 2.05 Securityholder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to
it of the names and addresses of
11
Securityholders. If the Trustee is not the Registrar, the Company shall cause
to be furnished to the Trustee at least semi-annually on September 1 and March
1 a listing of Securityholders dated within 15 days of the date on which the
list is furnished and at such other times as the Trustee may request in writing
a list in such form and as of such date as the Trustee may reasonably require
of the names and addresses of Securityholders.
Section 2.06 Transfer and Exchange. Subject to Section 2.12 hereof,
(a) Upon surrender for registration of transfer of any Security,
together with a written instrument of transfer satisfactory to the Registrar
duly executed by the Securityholder or such Securityholder's attorney duly
authorized in writing, at the office or agency of the Company designated as
Registrar or co-registrar pursuant to Section 2.03, the Company shall execute,
and the Trustee upon receipt of a Company Order shall authenticate and deliver,
in the name of the designated transferee or transferees, one or more new
Securities of any authorized denomination or denominations, of a like aggregate
Principal Amount at Maturity. The Company shall not charge a service charge for
any registration of transfer or exchange, but the Company may require payment
of a sum sufficient to pay all taxes, assessments or other governmental charges
that may be imposed in connection with the registration of transfer or exchange
of the Securities from the Securityholder requesting such registration of
transfer or exchange.
At the option of the Holder, Certificated Securities may be exchanged
for other Securities of any authorized denomination or denominations, of a like
aggregate Principal Amount at Maturity, upon surrender of the Securities to be
exchanged, together with a written instrument of transfer satisfactory to the
Registrar duly executed by the Securityholder or such Securityholder's attorney
duly authorized in writing, at such office or agency. Whenever any Securities
are so surrendered for exchange, the Company shall execute, and the Trustee
upon receipt of a Company Order shall authenticate and deliver, the Securities
which the Holder making the exchange is entitled to receive.
The Company shall not be required to make, and the Registrar need not
register, transfers or exchanges of Securities selected for redemption (except,
in the case of Securities to be redeemed in part, the portion thereof not to be
redeemed) or any Securities in respect of which a Purchase Notice or Change in
Control Purchase Notice has been given and not withdrawn by the Holder thereof
in accordance with the terms of this Indenture (except, in the case of
Securities to be purchased in part, the portion thereof not to be purchased) or
any Securities for a period of 15 days before the mailing of a notice of
redemption of Securities to be redeemed.
(b) Notwithstanding any provision to the contrary herein, so long as a
Global Security remains outstanding and is held by or on behalf of the
Depositary, transfers of a Global Security, in whole or in part, shall be made
only in accordance with Section 2.12 and this Section 2.06(b). Transfers of a
Global Security shall be limited to transfers of such Global Security in whole,
or in part, to nominees of the Depositary or to a successor of the Depositary
or such successor's nominee.
(c) Successive registrations and registrations of transfers and
exchanges as aforesaid may be made from time to time as desired, and each such
registration shall be noted on the register for the Securities.
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(d) Any Registrar appointed pursuant to Section 2.03 hereof shall
provide to the Trustee such information as the Trustee may reasonably require
in connection with the delivery by such Registrar of Securities upon
registration of transfer or exchange of Securities.
(e) No Registrar shall be required to make registrations of transfer
or exchange of Securities during any periods designated in the text of the
Securities or in this Indenture as periods during which such registration of
transfers and exchanges need not be made.
(f) If Securities are issued upon the registration of transfer,
exchange or replacement of Securities subject to restrictions on transfer and
bearing the legends set forth on the form of Security attached hereto as
Exhibits A-1 setting forth such restrictions (collectively, the "Legend"), or
if a request is made to remove the Legend on a Security, the Securities so
issued shall bear the Legend, or the Legend shall not be removed, as the case
may be, unless there is delivered to the Company and the Registrar such
satisfactory evidence, which shall include an Opinion of Counsel, as may be
reasonably required by the Company and the Registrar, that neither the Legend
nor the restrictions on transfer set forth therein are required to ensure that
transfers thereof comply with the provisions of Rule 144A or Rule 144 under the
Securities Act or that such Securities are not "restricted" within the meaning
of Rule 144 under the Securities Act. Upon (i) provision of such satisfactory
evidence, or (ii) notification by the Company to the Trustee and Registrar of
the sale of such Security pursuant to a registration statement that is
effective at the time of such sale, the Trustee, at the written direction of
the Company, shall authenticate and deliver a Security that does not bear the
Legend.
The Trustee and the Registrar shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any Security (including any transfers between
or among Depositary participants or beneficial owners of interests in any
Global Security) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and
when expressly required by the terms of, this Indenture, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof.
Section 2.07 Replacement Securities. If (a) any mutilated Security is
surrendered to the Trustee, or (b) the Company and the Trustee receive evidence
to their satisfaction of the destruction, loss or theft of any Security, and
there is delivered to the Company and the Trustee such security or indemnity as
may be required by them to save each 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 its written request the
Trustee shall authenticate and deliver, in exchange for any such mutilated
Security or in lieu of any such destroyed, lost or stolen Security, a new
Security of like tenor and Principal Amount at Maturity, 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, or is about to be purchased by
the Company pursuant to Article 3 hereof, the Company in its discretion may,
instead of issuing a new Security, pay or purchase such Security, as the case
may be.
13
Upon the issuance of any new Securities 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
mutilated, 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 shall
be entitled to all 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.
Section 2.08 Outstanding Securities; Determinations of Holders'
Action. Securities outstanding at any time are all the Securities authenticated
by the Trustee, except for those cancelled by it, those paid pursuant to
Section 2.07 delivered to it for cancellation and those described in this
Section 2.08 as not outstanding. A Security does not cease to be outstanding
because the Company or an Affiliate thereof holds the Security; provided,
however, that in determining whether the Holders of the requisite Principal
Amount at Maturity of Securities have given or concurred in 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 request, demand, authorization, direction,
notice, consent or waiver, only Securities which a Responsible Officer of the
Trustee actually knows to be so owned shall be so disregarded. Subject to the
foregoing, only Securities outstanding at the time of such determination shall
be considered in any such determination (including, without limitation,
determinations pursuant to Articles 6 and 9).
If a Security is replaced pursuant to Section 2.07, the replaced
Security ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced Security is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture, on a
Redemption Date, or on the Business Day following the Purchase Date or a Change
in Control Purchase Date, or on Stated Maturity, money or securities, if
permitted hereunder, sufficient to pay Securities payable on that date, then
immediately after such Redemption Date, Purchase Date, Change in Control
Purchase Date or Stated Maturity, as the case may be, such Securities shall
cease to be outstanding and Original Issue Discount, Contingent Cash Interest
and Contingent Additional Principal, if applicable, on such Securities shall
cease to accrue; provided, that if such Securities are to be redeemed, notice
of such redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been given pursuant to this Indenture.
If a Security is converted in accordance with Article 10, then from
and after the time of conversion on the Conversion Date, such Security shall
cease to be outstanding and Original
14
Issue Discount, Contingent Cash Interest, if any, and Contingent Additional
Principal, if any, shall cease to accrue on such Security.
Section 2.09 Temporary Securities. Subject to Article 12 hereof,
pending the preparation of definitive Securities, the Company may execute, and
upon Company Order the Trustee shall authenticate and deliver, temporary
Securities which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as conclusively evidenced by
their execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Company designated for such purpose pursuant to Section 2.03,
without charge to the Holder. Upon surrender for cancellation of any one or
more temporary Securities the Company shall execute and upon Company Order the
Trustee shall authenticate and deliver in exchange therefor a like Principal
Amount at Maturity of definitive Securities of authorized denominations. Until
so exchanged the temporary Securities shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities.
Section 2.10 Cancellation. All Securities surrendered for payment,
purchase by the Company pursuant to Article 3, conversion, redemption or
registration of transfer or exchange shall, if surrendered to any person other
than the Trustee, be delivered to the Trustee and shall be promptly cancelled
by it. The Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and all Securities so delivered
shall be promptly cancelled by the Trustee. The Company may not issue new
Securities to replace Securities it has paid or delivered to the Trustee for
cancellation or that any Holder has converted pursuant to Article 10. No
Securities shall be authenticated in lieu of or in exchange for any Securities
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Securities held by the Trustee shall be disposed of by
the Trustee in accordance with the Trustee's customary procedure.
Section 2.11 Persons Deemed Owners. Prior to due presentment of a
Security for registration of transfer, the Company, the Trustee and any agent
of the Company or the Trustee may treat the Person in whose name such Security
is registered as the owner of such Security for the purpose of receiving
payment of principal of the Security or the payment of any Redemption Price,
Purchase Price or Change in Control Purchase Price, Contingent Cash Interest,
if any, and Contingent Additional Principal and CAP-OID thereon, if any, for
the purpose of conversion and for all other purposes whatsoever, whether or not
such Security be overdue, and neither the Company, the Trustee nor any agent of
the Company or the Trustee shall be affected by notice to the contrary.
15
Section 2.12 Global Securities.
(a) Transfer of Global Security. Notwithstanding any other provisions
of this Indenture or the Securities, transfers of a Global Security, in whole
or in part, shall be made only in accordance with Section 2.06 and Section
2.12(a)(i). A Global Security may not be transferred, in whole or in part, to
any Person other than the Depositary or a nominee or any successor thereof, and
no such transfer to any such other Person may be registered; provided that this
clause (a) 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.
(b) Subject to the succeeding paragraph, every Security shall be
subject to the restrictions on transfer provided in the Legend including the
delivery of an Opinion of Counsel, if so provided.
(c) The restrictions imposed by the Legend upon the transferability of
any Security shall cease and terminate when such Security has been sold
pursuant to an effective registration statement under the Securities Act or
transferred in compliance with Rule 144 under the Securities Act (or any
successor provision thereto) or, if earlier, upon the expiration of the holding
period applicable to sales thereof under Rule 144(k) under the Securities Act
(or any successor provision). Any Security as to which such restrictions on
transfer shall have expired in accordance with their terms or shall have
terminated may, upon a surrender of such Security for exchange to the Registrar
in accordance with the provisions of this Section 2.12 (accompanied, in the
event that such restrictions on transfer have terminated by reason of a
transfer in compliance with Rule 144 or any successor provision, by an Opinion
of Counsel from legal counsel having substantial experience in practice under
the Securities Act and otherwise reasonably acceptable to the Company,
addressed to the Company, the Trustee and the Registrar and in form acceptable
to the Company, to the effect that the transfer of such Security has been made
in compliance with Rule 144 or such successor provision), be exchanged for a
new Security, of like tenor and aggregate Principal Amount at Maturity, which
shall not bear the restrictive Legend. The Company shall inform the Trustee of
the effective date of any registration statement registering the transfer or
sale of the Securities under the Securities Act. The Trustee and the Registrar
shall not be liable for any action taken or omitted to be taken by it in good
faith in accordance with the aforementioned Opinion of Counsel or registration
statement.
(d) As used in the preceding two paragraphs of this Section 2.12, the
term "transfer" encompasses any sale, pledge, transfer, hypothecation or other
disposition of any Security.
(e) The provisions of clauses (1), (2), (3) and (4) below shall apply
only to Global Securities:
(1) Notwithstanding any other provisions of this Indenture or the
Securities, except as provided in Section 2.12(a)(ii), a Global Security
shall not be exchanged in whole or in part for a Security registered in
the name of any Person other than the
16
Depositary or one or more nominees thereof, provided that a Global
Security may be exchanged for Securities registered in the names of any
person designated by the Depositary in the event that (i) the Depositary
has notified the Company that it is unwilling or unable to continue as
Depositary for such Global Security or such Depositary has ceased to be a
"clearing agency" registered under the Exchange Act, and a successor
Depositary is not appointed by the Company within 90 days, (ii) an Event
of Default has occurred and is continuing with respect to the Securities
or (iii) the Company discontinues the use of a book entry transfer through
DTC (or a successor thereof). Any Global Security exchanged pursuant to
clause (i) above shall be so exchanged in whole and not in part, and any
Global Security exchanged pursuant to clause (ii) 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 such Security so issued that
is registered in the name of a Person other than the Depository or a
Nominee thereof shall not be a Global Security.
(2) Securities issued in exchange for a Global Security or any
portion thereof shall be issued in definitive, fully registered form,
without interest coupons, shall have an aggregate Principal Amount at
Maturity 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 the
applicable legends provided for herein. Any Global Security to be
exchanged in whole shall be surrendered by the Depositary to the Trustee,
as 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 Amount at Maturity 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 deliver the Security issuable on such exchange to or upon
the order of the Depositary or an authorized representative thereof.
(3) Subject to the provisions of clause (5) below, the registered
Holder may grant proxies and otherwise authorize any Person, including
Agent Members (as defined below) and persons that may hold interests
through Agent Members, to take any action which a holder is entitled to
take under this Indenture or the Securities.
(4) In the event of the occurrence of any of the events specified in
clause (1) 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
(collectively, the "Agent Members") nor any other Persons on whose behalf
Agent Members may act shall have any rights under this Indenture with
respect to any Global Security registered in the name of the Depositary or
any nominee thereof, or under any such 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
17
Company or the 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.
Section 2.13 CUSIP Numbers. The Company in issuing the Securities may
use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall
use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to
the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Trustee of any change in the CUSIP
numbers.
ARTICLE 3
REDEMPTION AND PURCHASES
Section 3.01 Right to Redeem; Notices to Trustee. The Company, at its
option, may at any time on or after September 11, 2006 redeem the Securities in
accordance with the provisions of paragraphs 6 and 8 of the Securities. If the
Company elects to redeem Securities pursuant to paragraph 6 of the Securities,
it shall notify the Trustee in writing of the Redemption Date, the Principal
Amount at Maturity of Securities to be redeemed and the Redemption Price.
The Company shall give the notice to the Trustee provided for in this
Section 3.01 by a Company Order, at least 35 days before the Redemption Date
(unless a shorter notice shall be satisfactory to the Trustee).
Section 3.02 Selection of Securities to Be Redeemed. If less than all
the Securities are to be redeemed, the Trustee shall select the Securities to
be redeemed pro rata or by lot or by any other method the Trustee considers
fair and appropriate (so long as such method is not prohibited by the rules of
any stock exchange or quotation system on which the Securities are then listed
or quoted). The Trustee shall make the selection at least 30 days but not more
than 60 days before the Redemption Date from outstanding Securities not
previously called for redemption. The Trustee may select for redemption
portions of the Principal Amount at Maturity of Securities that have
denominations larger than $1,000.
Securities and portions of them the Trustee selects shall be in
Principal Amounts at Maturity of $1,000 or an integral multiple of $1,000.
Provisions of this Indenture that apply to Securities called for redemption
also apply to portions of Securities called for redemption. The Trustee shall
notify the Company promptly of the Securities or portions of Securities to be
redeemed.
If any Security selected for partial redemption is converted in part
before termination of the conversion right with respect to the portion of the
Security so selected, the converted portion of such Security shall be deemed
(so far as may be) to be the portion selected for redemption.
18
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.
Section 3.03 Notice of Redemption. At least 30 days but not more than
60 days before a Redemption Date, the Company shall mail a notice of redemption
by first-class mail, postage prepaid, to each Holder of Securities to be
redeemed.
The notice shall identify the Securities to be redeemed and shall
state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the Conversion Rate;
(4) the name and address of the Paying Agent and Conversion Agent;
(5) that Securities called for redemption may be converted at any
time before the close of business on the second Business Day immediately
preceding the Redemption Date;
(6) that Holders who want to convert Securities must satisfy the
requirements set forth in paragraph 9 of the Securities;
(7) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(8) if fewer than all the outstanding Securities are to be redeemed,
the certificate number and Principal Amounts at Maturity of the particular
Securities to be redeemed;
(9) that, unless the Company defaults in making payment of such
Redemption Price or Securities called for redemption, Original Issue
Discount, Contingent Cash Interest, if any, and Contingent Additional
Principal, if any, on Securities called for redemption will cease to
accrue on and after the Redemption Date;
(10) the CUSIP number of the Securities; and
(11) any other information the Company wants to present.
At the Company's request, the Trustee shall give the notice of
redemption to Holders in the Company's name and at the Company's expense,
provided that the Company makes such request at least five Business Days
(unless a shorter period shall be satisfactory to the Trustee) prior to the
date such notice of redemption must be mailed.
Section 3.04 Effect of Notice of Redemption. Once notice of redemption
is given, Securities called for redemption become due and payable on the
Redemption Date and at the Redemption Price stated in the notice except for
Securities which are converted in accordance
19
with the terms of this Indenture. Upon surrender to the Paying Agent, such
Securities shall be paid at the Redemption Xxxxx stated in the notice.
Section 3.05 Deposit of Redemption Price. Prior to 10:00 a.m. (New
York City time), on the Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company or a Subsidiary or an Affiliate of either of
them is the Paying Agent, shall segregate and hold in trust) money sufficient
to pay the Redemption Price for all Securities to be redeemed on that date
other than Securities or portions of Securities called for redemption which on
or prior thereto have been delivered by the Company to the Trustee for
cancellation or have been converted. The Paying Agent shall as promptly as
practicable return to the Company any money not required for that purpose
because of conversion of Securities pursuant to Article 10. If such money is
then held by the Company in trust and is not required for such purpose it shall
be discharged from such trust.
Section 3.06 Securities Redeemed in Part. Upon surrender of a Security
that is redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Security in an authorized
denomination equal in Principal Amount at Maturity to the unredeemed portion of
the Security surrendered.
Section 3.07 Conversion Arrangement on Call for Redemption. In
connection with any redemption of Securities, the Company may arrange for the
purchase and conversion of any Securities called for redemption by an agreement
with one or more investment banks or other purchasers to purchase such
Securities by paying to the Trustee in trust for the Securityholders, on or
prior to 10:00 a.m. New York City time on the Redemption Date, an amount that,
together with any amounts deposited with the Trustee by the Company for the
redemption of such Securities, is not less than the Redemption Price of such
Securities. Notwithstanding anything to the contrary contained in this Article
3, the obligation of the Company to pay the Redemption Price of such Securities
shall be deemed to be satisfied and discharged to the extent such amount is so
paid by such purchasers. If such an agreement is entered into, any Securities
not duly surrendered for conversion by the Holders thereof may, at the option
of the Company, be deemed, to the fullest extent permitted by law, acquired by
such purchasers from such Holders and (notwithstanding anything to the contrary
contained in Article 11) surrendered by such purchasers for conversion, all as
of immediately prior to the close of business on the Business Day prior to the
Redemption Date, subject to payment of the above amount as aforesaid. The
Trustee shall hold and pay to the Holders whose Securities are selected for
redemption any such amount paid to it for purchase and conversion in the same
manner as it would moneys deposited with it by the Company for the redemption
of Securities. Without the Trustee's prior written consent, no arrangement
between the Company and such purchasers for the purchase and conversion of any
Securities shall increase or otherwise affect any of the powers, duties,
responsibilities or obligations of the Trustee as set forth in this Indenture,
and the Company agrees to indemnify the Trustee from, and hold it harmless
against, any loss, liability or expense arising out of or in connection with
any such arrangement for the purchase and conversion of any Securities between
the Company and such purchasers, including the costs and expenses incurred by
the Trustee in the defense of any claim or liability arising out of or in
connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
20
Section 3.08 Purchase of Securities at Option of the Holder. (a)
General. Securities shall be purchased by the Company, at the option of the
Holder thereof, pursuant to paragraph 7 of the Securities on September 11,
2004, September 11, 2006 and September 11, 2011 (each, a "Purchase Date"), at
the purchase prices of $712.97, $741.92 and $819.54, respectively, per $1,000
of Principal Amount at Maturity plus, in each case, if applicable, Contingent
Additional Principal accrued thereon (and any accrued CAP-OID thereon) (each in
the aggregate, a "Purchase Price"), upon:
(1) delivery to the Paying Agent, by the Holder of a written notice
of purchase (a "Purchase Notice") at any time from the opening of business
on the date that is 20 Business Days prior to a Purchase Date until the
close of business on the first business day immediately preceding such
Purchase Date stating:
(A) the certificate numbers of the Security which the Holder
will deliver to be purchased,
(B) the portion of the Principal Amount at Maturity of the
Security which the Holder will deliver to be purchased, which portion
must be a Principal Amount at Maturity of $1,000 or an integral
multiple thereof,
(C) that such Security shall be purchased as of the Purchase
Date pursuant to the terms and conditions specified in paragraph 7 of
the Securities and in this Indenture, and
(D) in the event the Company elects, pursuant to Section
3.08(b), to pay the Purchase Price to be paid as of such Purchase
Date, in whole or in part, in shares of Common Stock but such portion
of the Purchase Price shall ultimately be payable to such Holder
entirely in cash because any of the conditions to payment of the
Purchase Price in Common Stock is not satisfied prior to the close of
business on such Purchase Date, as set forth in Section 3.08(d),
whether such Holder elects (i) to withdraw such Purchase Notice as to
some or all of the Securities to which such Purchase Notice relates
(stating the Principal Amount at Maturity and certificate numbers of
the Securities as to which such withdrawal shall relate), or (ii) to
receive cash in respect of the entire Purchase Price for all
Securities (or portions thereof) to which such Purchase Notice
relates; and
(2) delivery of such Security to the Paying Agent prior to, on or
after the Purchase Date (together with all necessary endorsements) at the
offices of the Paying Agent, such delivery being a condition to receipt by
the Holder of the Purchase Price therefor; provided, however, that such
Purchase Price shall be so paid pursuant to this Section 3.08 only if the
Security so delivered to the Paying Agent shall conform in all respects to
the description thereof in the related Purchase Notice, as determined by
the Company.
If a Holder, in such Holder's Purchase Notice and in any written
notice of withdrawal delivered by such Holder pursuant to the terms of Section
3.10, fails to indicate such Xxxxxx's choice with respect to the election set
forth in clause (D) of Section 3.08(a)(1), such Holder shall
21
be deemed to have elected to receive cash in respect of the Purchase Price for
all Securities subject to such Purchase Notice in the circumstances set forth
in such clause (D).
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.08, a portion of a Security if the Principal Amount at Maturity of
such portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.08 shall be consummated by the delivery of the consideration to
be received by the Holder promptly following the later of the Purchase Date and
the time of delivery of the Security.
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Purchase Notice contemplated by this Section 3.08(a)
shall have the right to withdraw such Purchase Notice at any time prior to the
close of business on the first business day immediately preceding the Purchase
Date by delivery of a written notice of withdrawal to the Paying Agent in
accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by
it of any Purchase Notice or written notice of withdrawal thereof.
(b) Company's Right to Elect Manner of Payment of Purchase Price. The
Securities to be purchased pursuant to Section 3.08(a) may be paid for, at the
election of the Company, in cash or Common Stock, or in any combination of cash
and Common Stock, subject to the conditions set forth in Sections 3.08(c) and
(d). The Company shall designate, in the Company Notice delivered pursuant to
Section 3.08(e), whether the Company will purchase the Securities for cash or
Common Stock, or, if a combination thereof, the percentages or amounts of the
Purchase Price of Securities in respect of which it will pay in cash or Common
Stock; provided that the Company will pay cash for fractional interests in
Common Stock. For purposes of determining the existence of potential fractional
interests, all Securities subject to purchase by the Company held by a Holder
shall be considered together (no matter how many separate certificates are to
be presented). Each Holder whose Securities are purchased pursuant to this
Section 3.08 shall receive the same percentage of cash or Common Stock in
payment of the Purchase Price for such Securities, except (i) as provided in
Section 3.08(d) with regard to the payment of cash in lieu of fractional shares
of Common Stock and (ii) in the event that the Company is unable to purchase
the Securities of a Holder or Holders for Common Stock because any necessary
qualifications or registrations of the Common Stock under applicable state
securities laws cannot be obtained, the Company may purchase the Securities of
such Holder or Holders for cash. The Company may not change its election with
respect to the consideration (or components or percentages of components
thereof) to be paid once the Company has given its Company Notice to
Securityholders except pursuant to this Section 3.08(b) or pursuant to Section
3.08(d) in the event of a failure to satisfy, prior to the close of business on
the Purchase Date, any condition to the payment of the Purchase Price, in whole
or in part, in Common Stock.
22
At least one Business Day before the Company Notice Date, the Company
shall deliver an Officers' Certificate to the Trustee specifying:
(i) the manner of payment selected by the Company,
(ii) the information required by Section 3.08(e),
(iii) if the Company elects to pay the Purchase Price, or a specified
percentage thereof, in Common Stock, that the conditions to such manner of
payment set forth in Section 3.08(d) have been or will be complied with,
and
(iv) whether the Company desires the Trustee to give the Company
Notice required by Section 3.08(e).
(c) Purchase with Cash. On each Purchase Date, at the option of the
Company, the Purchase Price of Securities in respect of which a Purchase Notice
pursuant to Section 3.08(a) has been given, or a specified percentage thereof,
may be paid by the Company with cash equal to the aggregate Purchase Price of
such Securities. If the Company elects to purchase Securities with cash, the
Company Notice, as provided in Section 3.08(e), shall be sent to Holders (and
to beneficial owners as required by applicable law) not less than 20 Business
Days prior to such Purchase Date (the "Company Notice Date").
(d) Payment by Issuance of Common Stock. On each Purchase Date, at the
option of the Company, the Purchase Price of Securities in respect of which a
Purchase Notice pursuant to Section 3.08(a) has been given, or a specified
percentage thereof, may be paid by the Company by the issuance of a number of
shares of Common Stock equal to the quotient obtained by dividing (i) the
amount of cash to which the Securityholders would have been entitled had the
Company elected to pay all or such specified percentage, as the case may be, of
the Purchase Price of such Securities in cash by (ii) the Market Price of a
share of Common Stock, subject to the next succeeding paragraph.
The Company will not issue a fractional share of Common Stock in
payment of the Purchase Price. Instead the Company will pay cash for the
current market value of the fractional share. The current market value of a
fraction of a share shall be determined by multiplying the Market Price by such
fraction and rounding the product to the nearest whole cent. It is understood
that if a Holder elects to have more than one Security purchased, the number of
shares of Common Stock shall be based on the aggregate amount of Securities to
be purchased.
Upon a payment by Common Stock pursuant to the terms hereof, that
portion of Accrued Original Issue Discount, accrued Contingent Additional
Principal, if any, and accrued unpaid Contingent Cash Interest, if any,
attributable to the period from the Issue Date to the Purchase Date with
respect to the purchased Security shall not be cancelled, extinguished or
forfeited but rather shall be deemed paid in full to the Holder through the
delivery of the Common Stock in exchange for the Security being purchased
pursuant to the terms hereof, and the fair market value of such Common Stock
(together with any cash payments in lieu of fractional shares of Common Stock)
shall be treated as issued, to the extent thereof, first in exchange for the
Accrued Original Issue Discount, Contingent Cash Interest, if any, and accrued
Contingent Additional Principal, through, but not including, the Purchase Date,
and the balance, if any, of the fair market value of
23
such shares of Common Stock shall be treated as issued in exchange for the
Issue Price of the Security being purchased pursuant to the provisions hereof.
If the Company elects to purchase the Securities by the issuance of
shares of Common Stock, the Company Notice, as provided in Section 3.08(e),
shall be sent to the Holders (and to beneficial owners as required by
applicable law) not later than the Company Notice Date.
The Company's right to exercise its election to purchase the
Securities pursuant to Section 3.08 through the issuance of shares of Common
Stock shall be conditioned upon:
(i) the Company's not having given its Company Notice of an election
to pay entirely in cash and its giving of timely Company Notice of
election to purchase all or a specified percentage of the Securities with
Common Stock as provided herein;
(ii) the shares of Common Stock having been admitted for listing or
admitted for listing subject to notice of issuance on the principal United
States securities exchange on which the Common Stock is then listed or, if
the Common Stock is not then listed on a national or regional securities
exchange, as quoted on the National Association of Securities Dealers
Automated Quotation System;
(iii) the registration of the shares of Common Stock to be issued in
respect of the payment of the Purchase Price under the Securities Act or
the Exchange Act, in each case, if required;
(iv) any necessary qualification or registration under applicable
state securities laws or the availability of an exemption from such
qualification and registration; and
(v) the receipt by the Trustee of an Officers' Certificate and an
Opinion of Counsel each stating that (A) the terms of the issuance of the
Common Stock are in conformity with this Indenture and (B) the shares of
Common Stock to be issued by the Company in payment of the Purchase Price
in respect of Securities have been duly authorized and, when issued and
delivered pursuant to the terms of this Indenture in payment of the
Purchase Price in respect of the Securities, will be validly issued, fully
paid and non-assessable and, to the such counsel's knowledge after due
inquiry, free from preemptive rights under law or material contracts, and,
in the case of such Officers' Certificate, stating that conditions (i),
(ii), (iii) and (iv) above and the condition set forth in the second
sentence following this sentence have been satisfied and, in the case of
such Opinion of Counsel, stating that conditions (ii) and (iii) above have
been satisfied.
Such Officers' Certificate shall also set forth the number of shares of Common
Stock to be issued for each $1,000 Principal Amount at Maturity of Securities
and the Sale Price of a share of Common Stock on each trading day during the
period for which the Market Price is calculated. The Company may pay the
Purchase Price (or any portion thereof) in Common Stock only if the information
necessary to calculate the Market Price is published in a daily newspaper of
national circulation. If the foregoing conditions are not satisfied with
respect to a Holder or Holders prior to the close of business on the Purchase
Date and the Company has elected to purchase the Securities pursuant to this
Section 3.08 through the issuance of shares of Common Stock, the
24
Company shall pay the entire Purchase Price of the Securities of such Holder or
Holders to be purchased in cash.
The "Market Price" of the Common Stock means the average of the Sale
Prices of the Common Stock for the five trading day period ending on the third
Business Day (if the third Business Day prior to the applicable Purchase Date
is a trading day or, if not, then on the last trading day) prior to the
applicable Purchase Date, appropriately adjusted to take into account the
occurrence, during the period commencing on the first of such trading days
during such five trading day period and ending on such Purchase Date, of any
events described in Section 10.06, 10.07 or 10.08; subject, however, to the
conditions set forth in Sections 10.09 and 10.10.
(e) Notice of Election. The Company's notice of election to purchase
with cash or Common Stock or any combination thereof shall be sent to the
Holders (and to beneficial owners as required by applicable law) in the manner
provided in Section 15.02 at the time specified in Section 3.08(c) or (d), as
applicable (the "Company Notice"). Such Company Notice shall state the manner
of payment elected and shall contain the following information:
In the event the Company has elected to pay the Purchase Price (or a
specified percentage thereof) with Common Stock, the Company Notice shall:
(1) state that each Holder will receive Common Stock with a Market
Price determined as of a specified date prior to the Purchase Date equal
to such specified percentage of the Purchase Price of the Securities held
by such Holder (except any cash amount to be paid in lieu of fractional
shares);
(2) set forth the method of calculating the Market Price of the
Common Stock; and
(3) state that because the Market Price of Common Stock will be
determined prior to the Purchase Date, Holders will bear the market risk
with respect to the value of the Common Stock to be received from the date
such Market Price is determined to the Purchase Date.
In any case, each Company Notice shall include a form of Purchase
Notice to be completed by a Securityholder and shall state:
(i) the Purchase Price and the Conversion Rate as of the Purchase
Date;
(ii) the name and address of the Paying Agent and the Conversion
Agent;
(iii) that Securities as to which a Purchase Notice has been given
may be converted pursuant to Article 10 hereof only if the applicable
Purchase Notice has been withdrawn in accordance with the terms of this
Indenture;
(iv) that Securities must be surrendered to the Paying Agent to
collect payment of the Purchase Price and accrued and unpaid Contingent
Interest, if any;
25
(v) that the Purchase Price for any Security as to which a Purchase
Notice has been given and not withdrawn will be paid promptly following
the later of the Purchase Date and the time of surrender of such Security
as described in (iv);
(vi) the procedures the Holder must follow to exercise rights under
Section 3.08 and a brief description of those rights;
(vii) briefly, the conversion rights of the Securities;
(viii) the procedures for withdrawing a Purchase Notice (including,
without limitation, for a conditional withdrawal pursuant to the terms of
Section 3.08(a)(1)(D) or Section 3.10);
(ix) that, unless the Company defaults in making payment of such
Purchase Price, Original Issue Discount, Contingent Cash Interest, if
applicable, and Contingent Additional Principal, if applicable, on
Securities surrendered for purchase will cease to accrue on and after the
Purchase Date; and
(x) the CUSIP number of the Securities.
At the Company's request, the Trustee shall give such Company Notice
in the Company's name and at the Company's expense; provided, however, that, in
all cases, the text of such Company Notice shall be prepared by the Company.
Upon determination of the actual number of shares of Common Stock to
be issued for each $1,000 Principal Amount at Maturity of Securities, the
Company will issue a press release and publish such determination on the
Company's Web site or otherwise through such other public medium as the Company
may use at that time.
(f) Covenants of the Company. All shares of Common Stock delivered
upon purchase of the Securities shall be newly issued shares or treasury
shares, shall be duly authorized, validly issued, fully paid and nonassessable
and shall be free from preemptive rights and free of any lien or adverse claim
created by the Company.
As a condition to the Company's right to purchase XXXXx, it shall list
or cause to have quoted any shares of Common Stock to be issued to purchase
Securities on each national securities exchange or over-the-counter or other
domestic market on which the Common Stock is then listed or quoted.
(g) Procedure upon Purchase. The Company shall deposit cash (in
respect of a cash purchase under Section 3.08(c) or for fractional interests,
as applicable) or shares of Common Stock, or a combination thereof, as
applicable, at the time and in the manner as provided in Section 3.11,
sufficient to pay the aggregate Purchase Price of, all Securities to be
purchased pursuant to this Section 3.08. As soon as practicable after the
Purchase Date, the Company shall deliver to each Holder entitled to receive
Common Stock through the Paying Agent, a certificate for the number of full
shares of Common Stock issuable in payment of the Purchase Price and cash in
lieu of any fractional interests. The person in whose name the certificate for
Common Stock is registered shall be treated as a holder of record of shares of
26
Common Stock on the Business Day following the Purchase Date. Subject to
Section 3.08(d), no payment or adjustment will be made for dividends on the
Common Stock the record date for which occurred on or prior to the Purchase
Date.
(h) Taxes. If a Holder of a Security is paid in Common Stock, the
Company shall pay any documentary, stamp or similar issue or transfer tax due
on such issue of shares of Common Stock. However, the Holder shall pay any such
tax which is due because the Holder requests the shares of Common Stock to be
issued in a name other than the Holder's name. The Paying Agent may refuse to
deliver the certificates representing the Common Stock being issued in a name
other than the Holder's name until the Paying Agent receives a sum sufficient
to pay any tax which will be due because the shares of Common Stock are to be
issued in a name other than the Holder's name. Nothing herein shall preclude
any income tax withholding required by law or regulations.
Section 3.09 Purchase of Securities at Option of the Holder upon
Change in Control. (a) If on or prior to September 11, 2006 there shall have
occurred a Change in Control, Securities shall be purchased by the Company, at
the option of the Holder thereof, at a purchase price specified in paragraph 7
of the Securities (the "Change in Control Purchase Price"), as of the date that
is no later than 35 Business Days after the occurrence of the Change in Control
but in no event prior to the date on which such Change in Control occurs (the
"Change in Control Purchase Date"), subject to satisfaction by or on behalf of
the Holder of the requirements set forth in Section 3.09(c).
A "Change in Control" shall be deemed to have occurred at such time as
either of the following events shall occur:
(i) Any person, including its Affiliates and Associates, other than
the Company or its subsidiaries, files on Schedule 13D or Schedule TO (or
any successor schedule, form or report) pursuant to the Exchange Act,
disclosing that such person (for the purposes of this Section 3.09 only,
as the term "person" is used in Section 13(d)(3) or Section 14(d)(2) of
the Exchange Act) has become the beneficial owner (as the term "beneficial
owner" is defined under Rule 13d-3 or any successor rule or regulation
promulgated under the Exchange Act) of 50% or more of the aggregate voting
power of the Common Stock and other Capital Stock of the Company with
equivalent voting rights then outstanding; provided, however, that a
person shall not be deemed beneficial owner of, or to own beneficially,
(A) any securities tendered pursuant to a tender or exchange offer made by
or on behalf of such person or any of such person's Affiliates or
Associates until such tendered securities are accepted for purchase or
exchange thereunder, or (B) any securities if such beneficial ownership
(1) arises solely as a result of a revocable proxy delivered in response
to a proxy or consent solicitation made pursuant to the applicable rules
and regulations under the Exchange Act, and (2) is not also then
reportable on Schedule 13D (or any successor schedule) under the Exchange
Act; or
(ii) There shall be consummated any share exchange, consolidation or
merger of the Company pursuant to which the Common Stock would be
converted into cash, securities or other property, in each case other than
a share exchange, consolidation or merger of the Company in which the
holders of the Common Stock and other capital
27
stock with equivalent voting rights, immediately prior to the share
exchange, consolidation or merger have, directly or indirectly, at least a
majority of the total voting power in the aggregate of all classes of
Capital Stock of the continuing or surviving corporation immediately after
the share exchange, consolidation or merger.
Notwithstanding the foregoing provisions of this Section 3.09, a Change in
Control shall not be deemed to have occurred by virtue of the Company or any
Subsidiary, any employee stock ownership plan or any other employee benefit
plan of the Company or any Subsidiary, or any person holding Common Stock for
or pursuant to the terms of any such employee benefit plan, filing or becoming
obligated to file a report under or in response to Schedule 13D or Schedule TO
(or any successor schedule, form or report) under the Exchange Act disclosing
beneficial ownership by it of shares of Common Stock, whether in excess of 50%
or otherwise.
"Associate" shall have the meaning ascribed to such term in Rule 12b-2
of the General Rules and Regulations under the Exchange Act, as in effect on
the date hereof.
(b) Within 15 days after a Change in Control, the Company shall mail a
written notice, which notice may be delivered in anticipation of a Change of
Control, of Change in Control by first-class mail to the Trustee and to each
Holder (and to beneficial owners as required by applicable law). The notice
shall include a form of Change in Control Purchase Notice to be completed by
the Securityholder and shall state:
(1) briefly, the events causing a Change in Control and the date of
such Change in Control;
(2) the date by which the Change in Control Purchase Notice pursuant
to this Section 3.09 must be given;
(3) the Change in Control Purchase Date;
(4) the Change in Control Purchase Price;
(5) the name and address of the Paying Agent and the Conversion
Agent;
(6) the Conversion Rate and any adjustments thereto;
(7) that Securities as to which a Change in Control Purchase Notice
has been given may be converted pursuant to Article 10 hereof only if the
Change in Control Purchase Notice has been withdrawn in accordance with
the terms of this Indenture;
(8) that Securities must be surrendered to the Paying Agent to
collect payment of the Change in Control Purchase Price;
(9) that the Change in Control Purchase Price for any Security as to
which a Change in Control Purchase Notice has been duly given and not
withdrawn, will be paid promptly following the later of the Change in
Control Purchase Date and the time of surrender of such Security as
described in (8);
28
(10) briefly, the procedures the Holder must follow to exercise
rights under this Section 3.09;
(11) briefly, the conversion rights of the Securities;
(12) the procedures for withdrawing a Change in Control Purchase
Notice;
(13) that, unless the Company defaults in making payment of such
Change in Control Purchase Price, on Securities surrendered for purchase
will cease to accrue Original Issue Discount and Contingent Additional
Principal on and after the Change in Control Purchase Date; and
(14) the CUSIP number of the Securities.
(c) A Holder may exercise its rights specified in Section 3.09(a) upon
delivery of a written notice of purchase (a "Change in Control Purchase
Notice") to the Paying Agent at any time prior to the close of business on the
Business Day prior to the Change in Control Purchase Date, stating:
(1) the certificate numbers of the Securities which the Holder will
deliver to be purchased;
(2) the portion of the Principal Amount at Maturity of the Securities
which the Holder will deliver to be purchased, which portion must be
$1,000 or an integral multiple thereof; and
(3) that such Securities shall be purchased pursuant to the terms and
conditions specified in paragraph 7 of the Securities.
The delivery of such Securities to the Paying Agent prior to, on or
after the Change in Control Purchase Date (together with all necessary
endorsements) at the offices of the Paying Agent shall be a condition to the
receipt by the Holder of the Change in Control Purchase Price therefor;
provided, however, that such Change in Control Purchase Price shall be so paid
pursuant to this Section 3.09 only if the Securities so delivered to the Paying
Agent shall conform in all respects to the description thereof set forth in the
related Change in Control Purchase Notice.
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.09, a portion of a Security if the Principal Amount at Maturity of
such portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.09 shall be consummated by the delivery of the consideration to
be received by the Holder promptly following the later of the Change in Control
Purchase Date and the time of delivery of the Security to the Paying Agent in
accordance with this Section 3.09.
29
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Change in Control Purchase Notice contemplated by this
Section 3.09(c) shall have the right to withdraw such Change in Control
Purchase Notice at any time prior to the close of business on the Business Day
prior to the Change in Control Purchase Date by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by
it of any Change in Control Purchase Notice or written withdrawal thereof.
The Company shall not be required to comply with this Section 3.09 if
a third party mails a written notice of Change in Control in the manner, at the
times and otherwise in compliance with this Section 3.09 and repurchases all
Securities for which a Change in Control Purchase Notice shall be delivered and
not withdrawn.
Section 3.10 Effect of Purchase Notice or Change in Control Purchase
Notice. Upon receipt by the Paying Agent of the Purchase Notice or Change in
Control Purchase Notice specified in Section 3.08(a) or Section 3.09(c), as
applicable, the Holder of the Security in respect of which such Purchase Notice
or Change in Control Purchase Notice, as the case may be, was given shall
(unless such Purchase Notice or Change in Control Purchase Notice is withdrawn
as specified in the following two paragraphs) thereafter be entitled to receive
solely the Purchase Price or Change in Control Purchase Price, as the case may
be, together with accrued and unpaid contingent interest, if any. Such amounts
shall be paid to such Holder, subject to receipts of funds and/or securities by
the Paying Agent, promptly following the later of (x) the Purchase Date or the
Change in Control Purchase Date, as the case may be, with respect to such
Security (provided the conditions in Section 3.08(a) or Section 3.09(c), as
applicable, have been satisfied) and (y) the time of delivery of such Security
to the Paying Agent by the Holder thereof in the manner required by Section
3.08(a) or Section 3.09(c), as applicable. Securities in respect of which a
Purchase Notice or Change in Control Purchase Notice, as the case may be, has
been given by the Holder thereof may not be converted pursuant to Article 10
hereof on or after the date of the delivery of such Purchase Notice or Change
in Control Purchase Notice, as the case may be, unless such Purchase Notice or
Change in Control Purchase Notice, as the case may be, has first been validly
withdrawn as specified in the following two paragraphs.
A Purchase Notice or Change in Control Purchase Notice, as the case
may be, may be withdrawn by means of a written notice of withdrawal delivered
to the office of the Paying Agent in accordance with the Purchase Notice or
Change in Control Purchase Notice, as the case may be, at any time prior to the
close of business on the Business Day prior to the Purchase Date or the Change
in Control Purchase Date, as the case may be, specifying:
(1) the certificate number of the Securities in respect of which such
notice of withdrawal is being submitted,
(2) the Principal Amount at Maturity of the Securities with respect
to which such notice of withdrawal is being submitted, and
30
(3) the Principal Amount at Maturity, if any, of such Securities
which remains subject to the original Purchase Notice or Change in Control
Purchase Notice, as the case may be, and which has been or will be
delivered for purchase by the Company.
A written notice of withdrawal of a Purchase Notice may be in the form
set forth in the preceding paragraph or may be in the form of (i) a conditional
withdrawal contained in a Purchase Notice pursuant to the terms of Section
3.08(a)(1)(D) or (ii) a conditional withdrawal containing the information set
forth in Section 3.08(a)(1)(D) and the preceding paragraph and contained in a
written notice of withdrawal delivered to the Paying Agent as set forth in the
preceding paragraph.
There shall be no purchase of any Securities pursuant to Section 3.08
(other than through the issuance of Common Stock in payment of the Purchase
Price, including cash in lieu of fractional shares) or 3.09 if there has
occurred (prior to, on or after, as the case may be, the giving, by the Holders
of such Securities, of the required Purchase Notice or Change in Control
Purchase Notice, as the case may be) and is continuing an Event of Default
(other than a default in the payment of the Purchase Price or Change in Control
Purchase Price, as the case may be). The Paying Agent will promptly return to
the respective Holders thereof any Securities (x) with respect to which a
Purchase Notice or Change in Control Purchase Notice, as the case may be, has
been withdrawn in compliance with this Indenture, or (y) held by it during the
continuance of an Event of Default (other than a default in the payment of the
Purchase Price or Change in Control Purchase Price, as the case may be, with
respect to the Securities in which case), upon such return, the Purchase Notice
or Change in Control Purchase Notice with respect thereto shall be deemed to
have been withdrawn.
Section 3.11 Deposit of Purchase Price or Change in Control Purchase
Price. Prior to 10:00 a.m., New York City time, on the Business Day following
the Purchase Date or the Change in Control Purchase Date, as the case may be,
the Company shall deposit with the Trustee or with the Paying Agent (or, if the
Company or a Subsidiary or an Affiliate of either of them is acting as the
Paying Agent, shall segregate and hold in trust as provided in Section 2.04) an
amount of money (in immediately available funds if deposited on such Business
Day) or Common Stock, if permitted hereunder, sufficient to pay the aggregate
Purchase Price or Change in Control Purchase Price, as the case may be, of all
the Securities or portions thereof which are to be purchased as of the Purchase
Date or Change in Control Purchase Date, as the case may be.
Section 3.12 Securities Purchased in Part. Any Security which is to be
purchased only in part shall be surrendered at the office of the Paying Agent
(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 such Xxxxxx'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 Xxxxxx in aggregate Principal Amount at Maturity equal to,
and in exchange for, the portion of the Principal Amount at Maturity of the
Security so surrendered which is not purchased.
Section 3.13 Covenant to Comply with Securities Laws upon Purchase of
Securities. In connection with any offer to purchase or purchase of Securities
under Section 3.08 or 3.09 hereof
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(provided that such offer or purchase constitutes an "issuer tender offer" for
purposes of Rule 13e-4 (which term, as used herein, includes any successor
provision thereto) under the Exchange Act at the time of such offer or purchase
or is otherwise subject to tender offer or other rules under the Federal or
state securities laws), the Company shall (i) comply with Rule 13e-4, Rule
14e-1 and any other tender offer rules under the Exchange Act which may then be
applicable, (ii) file the related Schedule TO (or any successor schedule, form
or report) or any other schedule required under the Exchange Act, and (iii)
otherwise comply with all Federal and state securities laws so as to permit the
rights and obligations under Sections 3.08 and 3.09 to be exercised in the time
and in the manner specified in Sections 3.08 and 3.09.
Section 3.14 Repayment to the Company. The Trustee and the Paying
Agent shall promptly return to the Company any cash or shares of Common Stock
that remain unclaimed as provided in paragraph 17 of the Securities, together
with interest or dividends, if any, thereon (subject to the provisions of
Section 7.01(f)), held by them for the payment of the Purchase Price or Change
in Control Purchase Price, as the case may be; provided, however, that to the
extent that the aggregate amount of cash or shares of Common Stock deposited by
the Company pursuant to Section 3.11 exceeds the aggregate Purchase Price or
Change in Control Purchase Price, as the case may be, of, the Securities or
portions thereof which the Company is obligated to purchase as of the Purchase
Date or Change in Control Purchase Date, as the case may be, whether as a
result of withdrawal or otherwise, then promptly after the Business Day
following the Purchase Date or Change in Control Purchase Date, as the case may
be, the Trustee shall return any such excess to the Company together with
interest or dividends, if any, thereon (subject to the provisions of Section
7.01(f)).
ARTICLE 4
COVENANTS
Section 4.01 Payment of Securities. The Company shall promptly make
all payments in respect of the Securities on the dates and in the manner
provided in the Securities or pursuant to this Indenture. Any amounts to be
given to the Trustee or Paying Agent, shall be deposited with the Trustee or
Paying Agent by 10:00 a.m., New York City time, by the Company. Principal
Amount at Maturity, Issue Price plus Accrued Original Issue Discount,
Redemption Price, Purchase Price, Change in Control Purchase Price, Contingent
Cash Interest, if any, and Contingent Additional Principal, if any, shall be
considered paid on the applicable date due if on such date (or, in the case of
a Purchase Price or Change in Control Purchase Price, on the Business Day
following the applicable Purchase Date or Change in Control Purchase Date, as
the case may be) the Trustee or the Paying Agent holds, in accordance with this
Indenture, money or securities, if permitted hereunder, sufficient to pay all
such amounts then due.
The Company shall, to the extent permitted by law, pay interest on
overdue amounts at the rate per annum set forth in paragraph 1 of the
Securities, compounded Semi-annually, which interest shall accrue from the date
such overdue amount was originally due to the date payment of such amount,
including interest thereon, has been made or duly provided for. All such
interest shall be payable on demand. The accrual of such interest on overdue
amounts shall be in lieu of, and not in addition to, the continued accrual of
Original Issue Discount, Contingent Cash Interest, if any, and Contingent
Additional Principal, if any.
32
Section 4.02 SEC and Other Reports. If requested by the Trustee, the
Company shall deliver to the Trustee, within 15 days after it files such annual
and quarterly reports, information, documents and other reports with the SEC,
copies of its annual report and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the SEC may by rules and
regulations prescribe) which the Company is required to file with the SEC
pursuant to Section 13 or 15(d) of the Exchange Act. The Company shall send to
the Trustee all reports required pursuant to the provisions of TIA Section
314(a). Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of the same shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 4.03 Compliance Certificate. The Company shall deliver to the
Trustee within 120 days after the end of each fiscal year of the Company
(beginning with the fiscal year ending on December 31, 2001) an Officers'
Certificate, stating whether or not to the best knowledge of the signers
thereof the Company is in default in the performance and observance of any of
the terms, provisions and conditions of this Indenture (without regard to any
period of grace or requirement of notice provided hereunder) and if the Company
shall be in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge.
Section 4.04 Further Instruments and Acts. Upon request of the
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
Section 4.05 Maintenance of Office or Agency. The Company will
maintain in the Borough of Manhattan, The City of New York, an office or agency
of the Trustee, Registrar, Paying Agent and Conversion Agent where Securities
may be presented or surrendered for payment, where Securities may be
surrendered for registration of transfer, exchange, purchase, redemption or
conversion and where notices and demands to or upon the Company in respect of
the Securities and this Indenture may be served. The office of The Bank of New
York, located at 000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx, Xxx Xxxx, Xxx Xxxx 00000
(Attention: Corporate Trust Administration-Trustee Administration), shall
initially be such office or agency for all of the aforesaid purposes. The
Company shall give prompt written notice to the Trustee of the location, and of
any change in the location, of any such office or agency (other than a change
in the location of the office of the Trustee). If at any time the Company shall
fail to maintain any such required office or agency or shall fail to furnish
the Trustee with the address thereof, such presentations, surrenders, notices
and demands may be made or served at the address of the Trustee set forth in
Section 15.02.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes.
33
Section 4.06 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 or any beneficial holder of Securities or shares of Common
Stock which are restricted securities issued upon conversion thereof, the
Company will promptly furnish or cause to be furnished Rule 144A Information
(as defined below) to such Holder or any beneficial holder of Securities or
holder of shares of Common Stock issued upon conversion of Securities, or to a
prospective purchaser of any such security designated by any such holder, as
the case may be, to the extent required to permit compliance by such Holder or
holder with Rule 144A under the Securities Act in connection with the resale of
any such security. "Rule 144A Information" shall be such information as is
specified pursuant to Rule 144A(d)(4) under the Securities Act.
Section 4.07 Tax Matters. The parties hereto hereby agree, and each
Holder (or other person that acquires a beneficial interest in a Security) by
its purchase of a Security (or a beneficial interest therein) hereby agrees:
(1) to treat the Securities as indebtedness of the Company for all tax
purposes;
(2) to treat the Securities as indebtedness that is subject to the
special regulations governing contingent payment debt instruments
that are contained in U.S. Treasury Regulation Section 1.1275-4;
(3) to treat any payment to and receipt by a holder of shares of Common
Stock (or of any cash in lieu of fractional shares) upon the
conversion of a Security as a contingent payment under U.S. Treasury
Regulation Section 1.1275-4(b) that will result in an adjustment
under U.S. Treasury Regulation Section 1.1275-4(b)(3)(iv) and U.S.
Treasury Regulation Section 1.1275-4(b)(6);
(4) solely for U.S. federal income tax purposes, the Company shall accrue
interest with respect to outstanding Securities as original issue
discount according to the "noncontingent bond method," as set forth
in U.S. Treasury Regulation Section 1.1275-4(b);
(5) the Company has determined that the comparable yield, as defined in
U.S. Treasury Regulation Section 1.1275-4(b)(4)(i), for the
Securities is 8.68%, compounded semiannually;
(6) (i) the comparable yield and the projected payment schedule are not
determined for any purpose other than for the purpose of applying
U.S. Treasury Regulation Section 1.1275-4(b)(4) to the Securities and
(ii) the comparable yield and the projected payment schedule do not
constitute a projection or representation regarding the actual
amounts payable on the Securities; and
(7) the projected payment schedule, as defined in U.S. Treasury
Regulation Section 1.1275-4(b)(4)(ii) for the Securities is as set
forth in Annex C hereto.
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ARTICLE 5
SUCCESSOR CORPORATION
Section 5.01 When Company May Merge or Transfer Assets. The Company
shall not consolidate with or merge with or into any other person or convey,
transfer or lease all or substantially all of its properties and assets as an
entirety to any person, unless:
(a) either (1) the Company shall be the continuing corporation or (2)
the person (if other than the Company) formed by such consolidation or
into which the Company is merged or the person which acquires by
conveyance, transfer or lease the properties and assets of the Company
substantially as an entirety (i) shall be a corporation organized and
validly existing under the laws of the United States or any State thereof
or the District of Columbia and (ii) shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Trustee, in
form reasonably satisfactory to the Trustee, all of the obligations of the
Company under the Securities and this Indenture;
(b) immediately after giving effect to such transaction, no Default
shall have occurred and be continuing; and
(c) 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 5 and that all
conditions precedent herein provided for relating to such transaction have
been satisfied.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise) of the properties and assets of one or more Subsidiaries
(other than to the Company or another Subsidiary), which, if such assets were
owned by the Company, would constitute all or substantially all of the
properties and assets of the Company, shall be deemed to be the transfer of all
or substantially all of the properties and assets of the Company.
The successor person formed by such consolidation or into which the
Company is merged or the successor person 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 had been named as the Company herein; and thereafter, except in
the case of a lease and any obligations the Company may have under a
supplemental indenture pursuant to Section 10.14, the Company shall be
discharged from all obligations and covenants under this Indenture and the
Securities. Subject to Section 9.06, the Company, the Trustee and the successor
person shall enter into a supplemental indenture to evidence the succession and
substitution of such successor person and such discharge and release of the
Company.
35
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.01 Events of Default. An "Event of Default" means the
occurrence of any one of the following events:
(1) the Company defaults in the payment of the Principal Amount at
Maturity, Issue Price plus Accrued Original Issue Discount, Contingent
Additional Principal, Redemption Price, Purchase Price, or Change in
Control Purchase Price on any Security when the same becomes due and
payable at its Stated Maturity, upon redemption, upon declaration, when
due for purchase by the Company or otherwise, whether or not such payment
is prohibited by the provisions of this Indenture;
(2) failure by the Company to pay any Contingent Cash Interest on any
Security when the same becomes due and payable, and such failure continues
unremedied for a period of 30 or more days, whether or not such payment is
prohibited by the provisions of this Indenture;
(3) the failure of the Company to comply with any of its agreements
in the Notes or this Indenture (other than those referred to in clauses
(1) or (2) above) upon the receipt of notice of such default from the
Trustee or from Holders of not less than 25% in aggregate Principal Amount
at Maturity of the Securities then outstanding (a "Notice of Default") and
such failure (or the failure to obtain a waiver thereof) continues uncured
for 60 days after receipt by the Company of a Notice of Default;
(4) (a) failure of the Company to make any payment by the end of any
applicable grace period after maturity of Debt in an amount (taken
together with amounts in (b) below) in excess of $25,000,000 and
continuance of such failure, or (b) the acceleration of Debt in an amount
in excess of $25,000,000 because of a default with respect to such Debt
without such Debt having been discharged or such acceleration having been
cured, waived, rescinded or annulled, in the case of (a) above, for a
period of 30 days after receipt by the Company of a Notice of Default from
the Trustee or to the Company and Trustee from the holders of not less
than 25% in Aggregate Principal Amount at Maturity of the Securities then
outstanding; provided, however, that if any such failure or acceleration
referred to in (a) or (b) above shall cease or be cured, waived, rescinded
or annulled, then the Event of Default by reason thereof shall be deemed
not to have occurred;
(5) the Company or any Significant Subsidiary pursuant to or under or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding;
(B) consents to the entry of an order for relief against it in
an involuntary case or proceeding or the commencement of any case
against it;
(C) consents to the appointment of a Custodian of it or for any
substantial part of its property;
36
(D) makes a general assignment for the benefit of its creditors;
(E) files a petition in bankruptcy or answer or consent seeking
reorganization or relief; or
(F) consents to the filing of such petition or the appointment
of or taking possession by a Custodian; or
(6) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary in an involuntary case or proceeding, or adjudicates the
Company or any Significant Subsidiary insolvent or bankrupt;
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its property; or
(C) orders the winding-up or liquidation of the Company or any
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 days.
"Bankruptcy Law" means Title 11, United States Code, or any similar
federal or state law for the relief of debtors.
"Custodian" means any receiver, trustee, assignee, liquidator,
custodian or similar official under any Bankruptcy Law.
A Default under clause (3) or clause (4) above is not an Event of
Default until the Trustee notifies the Company, or the Holders of at least 25%
in aggregate Principal Amount at Maturity of the Securities at the time
outstanding notify the Company and the Trustee, of the Default and the Company
does not cure such Default (and such Default is not waived) within the time
specified in clause (3) or clause (4) above after actual receipt of such
notice. Any such notice must specify the Default, demand that it be remedied
and state that such notice is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after it
becomes aware of the occurrence thereof, written notice of any event which with
the giving of notice or the lapse of time, or both, would become an Event of
Default under clause (3) or clause (4) above, its status and what action the
Company is taking or proposes to take with respect thereto.
Section 6.02 Acceleration . If an Event of Default (other than an
Event of Default specified in Section 6.01(5) or (6) in respect of the Company)
occurs and is continuing, the Trustee by Notice to the Company, or the Holders
of at least 25% in aggregate Principal Amount at Maturity of the Securities at
the time outstanding by notice to the Company and the Trustee, may declare the
Issue Price plus Accrued Original Issue Discount, accrued and unpaid Contingent
Cash Interest, if any, and Contingent Additional Principal, if any, through the
date of
37
such declaration, on all the Securities to be immediately due and payable. Upon
such a declaration, such Issue Price plus Accrued Original Issue Discount,
accrued and unpaid Contingent Cash Interest, if any, and accrued Contingent
Additional Principal, if any, shall be due and payable immediately. If an Event
of Default specified in Section 6.01(4) or (5) occurs in respect of the Company
and is continuing, the Issue Price plus Accrued Original Issue Discount,
accrued and unpaid Contingent Cash Interest, if any, and accrued Contingent
Additional Principal, if any, on all the Securities shall become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Securityholders. The Holders of a majority in aggregate
Principal Amount at Maturity of the Securities at the time outstanding, by
notice to the Trustee (and without notice to any other Securityholder) may
rescind an acceleration and its consequences if the rescission would not
conflict with any judgment or decree and if all existing Events of Default have
been cured or waived except nonpayment of the Issue Price plus Accrued Original
Issue Discount and accrued Contingent Additional Principal, if any, plus
accrued and unpaid Contingent Cash Interest that have become due solely as a
result of acceleration and if all amounts due to the Trustee under Section 7.07
have been paid. No such rescission shall affect any subsequent Default or
impair any right consequent thereto.
Section 6.03 Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of the Issue Price plus Accrued Original Issue Discount, accrued and unpaid
Contingent Cash Interest and Contingent Additional Principal, if any, on the
Securities or to enforce the performance of any provision of the Securities or
this Indenture.
The Trustee may maintain a proceeding even if the Trustee does not
possess any of the Securities or does not produce any of the Securities in the
proceeding. A delay or omission by the Trustee or any Securityholder in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of, or acquiescence in, the
Event of Default. No remedy is exclusive of any other remedy. All available
remedies are cumulative.
Section 6.04 Waiver of Past Defaults. Subject to Section 6.02, the
Holders of a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding, by notice to the Trustee (and without
notice to any other Securityholder), may waive an existing Default and its
consequences except (a) an Event of Default described in Section 6.01(1) or
Section 6.01(2), a Default in respect of a provision that under Section 9.02
cannot be amended without the consent of each Securityholder affected or (b) a
Default which constitutes a failure to convert any Security in accordance with
the terms of Article 10. When a Default is waived, it is deemed cured, but no
such waiver shall extend to any subsequent or other Default or impair any
consequent right. This Section 6.04 shall be in lieu of Section 316(a)1(B) of
the TIA and such Section 316(a)1(B) is hereby expressly excluded from this
Indenture, as permitted by the TIA.
Section 6.05 Control by Majority. The Holders of a majority in
aggregate Principal Amount at Maturity of the Securities at the time
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or of exercising any trust or power
conferred on the Trustee. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture or that the Trustee
determines in good faith is unduly prejudicial to the rights of other
Securityholders or would involve the Trustee in personal
38
liability unless the Trustee is offered indemnity satisfactory to it. This
Section 6.05 shall be in lieu of Section 316(a)1(A) of the TIA and such Section
316(a)1(A) is hereby expressly excluded from this Indenture, as permitted by
the TIA.
Section 6.06 Limitation on Suits. A Securityholder may not pursue any
remedy with respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(2) the Holders of at least 25% in aggregate Principal Amount at
Maturity of the Securities at the time outstanding make a written request
to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee security or indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of such notice, request and offer of security or indemnity; and
(5) the Holders of a majority in aggregate Principal Amount at
Maturity of the Securities at the time outstanding do not give the Trustee
a direction inconsistent with the request during such 60-day period.
A Securityholder may not use this Indenture to prejudice the rights of
any other Securityholder or to obtain a preference or priority over any other
Securityholder.
Section 6.07 Rights of Holders to Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Holder to receive payment
of the Principal Amount at Maturity, Issue Price, Accrued Original Issue
Discount, Redemption Price, Purchase Price, Change in Control Purchase Price,
Contingent Cash Interest, if any, and accrued Contingent Additional Principal,
if any, in respect of the Securities held by such Holder, on or after the
respective due dates expressed in the Securities or any Redemption Date, and to
convert the Securities in accordance with Article 10, or to bring suit for the
enforcement of any such payment on or after such respective dates or the right
to convert, shall not be impaired or affected adversely without the consent of
such Holder.
Section 6.08 Collection Suit by Trustee. If an Event of Default
described in Section 6.01(1) or Section 6.01(2) occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against the Company for the whole amount owing with respect to the Securities
and the amounts provided for in Section 7.07.
Section 6.09 Trustee May File Proofs of Claim. In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Securities or the property of the
Company or of such other obligor or their creditors, the Trustee (irrespective
of whether the Principal Amount at Maturity, Issue Price, Accrued Original
Issue Discount, Redemption Price, Purchase Price, Change in Control Purchase
Price, Contingent Cash
39
Interest, if any, or Contingent Additional Principal, if any, in respect of the
Securities shall then be due and payable as therein expressed or by declaration
or otherwise and irrespective of whether the Trustee shall have made any demand
on the Company for the payment of any such amount) shall be entitled and
empowered, by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of the Principal
Amount at Maturity, Issue Price, Accrued Original Issue Discount,
Redemption Price, Purchase Price, Change in Control Purchase Price,
Contingent Cash Interest, if any, or accrued Contingent Additional
Principal, if any, as the case may be, 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 or any other amounts due the Trustee under Section 7.07) and of
the Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder 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, to pay
the Trustee any amount due 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 7.07.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder 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 in any such proceeding.
Section 6.10 Priorities. If the Trustee collects any money pursuant to
this Article 6, it shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for the Principal Amount at Maturity, Issue Price, Accrued
Original Issue Discount, Redemption Price, Purchase Price, Change in
Control Purchase Price, Contingent Cash Interest, if any, and accrued
Contingent Additional Principal, if any, as the case may be, ratably,
without preference or priority of any kind, according to such amounts due
and payable on the Securities; and
THIRD: the balance, if any, to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section 6.10. At least 15 days before such
record date, the Trustee shall mail to each Securityholder and the Company a
notice that states the record date, the payment date and the amount to be paid.
40
Section 6.11 Undertaking for Costs. In any suit for the enforcement of
any right or remedy under this Indenture or in any suit against the Trustee for
any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant (other than the Trustee) in the suit
of an undertaking to pay the costs of the suit, and the court in its discretion
may assess reasonable costs, including reasonable attorneys' fees and expenses,
against any party litigant in the suit, having due regard to the merits and
good faith of the claims or defenses made by the party litigant. This Section
6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to
Section 6.07 or a suit by Holders of more than 25% in aggregate Principal
Amount at Maturity of the Securities at the time outstanding. This Section 6.11
shall be in lieu of Section 315(e) of the TIA and such Section 315(e) is hereby
expressly excluded from this Indenture, as permitted by the TIA.
Section 6.12 Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury or other law
wherever enacted, now or at any time hereafter in force, which would prohibit
or forgive the Company from paying all or any portion of the Principal Amount
at Maturity, Issue Price, Accrued Original Issue Discount, Redemption Price,
Purchase Price, Change in Control Purchase Price, Contingent Cash Interest, if
any, and accrued Contingent Additional Principal, if any, in respect of
Securities, or any interest on such amounts, as contemplated herein, or 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 7
TRUSTEE
Section 7.01 Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in its
exercise as a prudent person would exercise or use under the circumstances in
the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties that are specifically
set forth in this Indenture and no others; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture, but
in case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee
shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture, but need not confirm
or investigate the accuracy of mathematical calculations or other facts
stated therein.
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This Section 7.01(b) shall be in lieu of Section 315(a) of the TIA and
such Section 315(a) is hereby expressly excluded from this Indenture, as
permitted by the TIA.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph (c) does not limit the effect of paragraph (b) of
this Section 7.01;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer unless it is proved that the Trustee
was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
Subparagraphs (c)(1), (2) and (3) shall be in lieu of Sections 315(d)(1),
315(d)(2) and 315(d)(3) of the TIA and such Sections 315(d)(1), 315(d)(2) and
315(d)(3) are hereby expressly excluded from this Indenture, as permitted by
the TIA.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (e) of this Section 7.01.
(e) The Trustee may refuse to perform any duty or exercise any right
or power or extend or risk its own funds or otherwise incur any financial
liability unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
(acting in any capacity hereunder) shall be under no liability for interest on
any money received by it hereunder unless otherwise agreed in writing with the
Company.
Section 7.02 Rights of Trustee. Subject to its duties and
responsibilities under the provisions of Section 7.01, and, except as expressly
excluded from this Indenture pursuant to said Section 7.01, under the TIA:
(a) the Trustee may conclusively rely and shall be protected in
acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, 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;
(b) 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, conclusively rely upon an Officers' Certificate;
42
(c) 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;
(d) the Trustee shall not be liable for any action taken, suffered,
or omitted to be taken by it in good faith which it believes to be
authorized or within its rights or powers conferred under this Indenture;
(e) the Trustee may consult with counsel selected by it and any
advice or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or Opinion of
Counsel;
(f) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this
Indenture, unless such Holders shall have offered to the Trustee security
or indemnity satisfactory to it against the costs, expenses and
liabilities which may be incurred therein or thereby;
(g) 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
resolution of the Board of Directors;
(h) 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, other evidence of indebtedness or other paper or
document, but the Trustee, in its 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 at the sole
cost of the Company and shall incur no liability or additional liability
of any kind by reason of such inquiry or investigation;
(i) the Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact
such a default is received by the Trustee at the Corporate Trust Office of
the Trustee, and such notice references the Securities and this Indenture;
(j) the rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in
each of its capacities hereunder, and to each agent, custodian and other
Person employed to act hereunder; and
(k) the Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to
43
take specified actions pursuant to this Indenture, which Officers'
Certificate may be signed by any person authorized to sign an Officers'
Certificate, including any person specified as so authorized in any such
certificate previously delivered and not superseded.
Section 7.03 Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, Conversion
Agent or co-registrar may do the same with like rights. However, the Trustee
must comply with Sections 7.10 and 7.11.
Section 7.04 Trustee's Disclaimer. The Trustee makes no representation
as to the validity or adequacy of this Indenture or the Securities, it shall
not be accountable for the Company's use or application of the proceeds from
the Securities, it shall not be responsible for any statement in the
registration statement for the Securities under the Securities Act or in the
Indenture or the Securities (other than its certificate of authentication), or
the determination as to which beneficial owners are entitled to receive any
notices hereunder.
Section 7.05 Notice of Defaults. If a Default occurs and if it is
known to the Trustee, the Trustee shall give to each Securityholder notice of
the Default within 90 days after it occurs unless such Default shall have been
cured or waived before the giving of such notice. Except in the case of a
Default described in Section 6.01(1) or 6.01(2), the Trustee may withhold the
notice if and so long as a committee of its Responsible Officers in good faith
determines that withholding the notice is in the interests of Securityholders.
The second sentence of this Section 7.05 shall be in lieu of the proviso to
Section 315(b) of the TIA and such proviso is hereby expressly excluded from
this Indenture, as permitted by the TIA. The Trustee shall not be deemed to
have knowledge of a Default unless a Responsible Officer of the Trustee has
received written notice of such Default.
Section 7.06 Reports by Trustee to Holders. Within 60 days after each
May 15 beginning with the May 15 following the date of this Indenture, the
Trustee shall mail to each Securityholder a brief report dated as of such May
15 that complies with TIA Section 313(a), if required by such Section 313(a).
The Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each securities exchange, if any, on which the
Securities are listed. The Company agrees to promptly notify the Trustee
whenever the Securities become listed on any securities exchange and of any
delisting thereof.
Section 7.07 Compensation and Indemnity. The Company agrees:
(a) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited (to
the extent permitted by law) by any provision of law in regard to the
compensation of a trustee of an express trust);
(b) to reimburse the Trustee upon its request for all expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any provision of this Indenture (including the compensation and the expenses,
advances and disbursements of its agents and
44
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(c) to indemnify the Trustee or any predecessor, Trustee and their
agents for, and to hold them harmless against, any loss, damage, claim,
liability, cost or expense (including attorney's fees and taxes (other than
taxes based upon, measured by or determined by the income of the Trustee))
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of this trust, including the
reasonable costs and expenses of defending itself against any claim (whether
asserted by the Company or any Holder or any other Person) or liability in
connection with the exercise or performance of any of its powers or duties
hereunder.
To secure the Company's payment obligations in this Section 7.07, the
Holders shall have been deemed to have granted to the Trustee a lien prior to
the Securities on all money or property held or collected by the Trustee,
except that held in trust to pay the Principal Amount at Maturity, Issue Price,
Accrued Original Issue Discount, Redemption Price, Purchase Price, Change in
Control Purchase Price, Contingent Cash Interest, if any, and Contingent
Additional Principal, if any, as the case may be, on particular Securities.
The Company's payment obligations pursuant to this Section 7.07 shall
survive the discharge of this Indenture and the resignation or removal of the
Trustee. When the Trustee incurs expenses after the occurrence of a Default
specified in Section 6.01(4) or (5), the expenses including the reasonable
charges and expenses of its counsel, are intended to constitute expenses of
administration under any Bankruptcy Law.
Section 7.08 Replacement of Trustee. The Trustee may resign by so
notifying the Company; provided, however, no such resignation shall be
effective until a successor Trustee has accepted its appointment pursuant to
this Section 7.08. The Holders of a majority in aggregate Principal Amount at
Maturity of the Securities at the time outstanding may remove the Trustee by so
notifying the Trustee and the Company. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or public officer takes charge of the Trustee or its
property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint, by
resolution of its Board of Directors, a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company satisfactory in form and
substance to the retiring Trustee and the Company. Thereupon the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Securityholders. The
45
retiring Trustee shall promptly transfer all property held by it as Trustee to
the successor Trustee, subject to the lien provided for in Section 7.07.
If a successor Xxxxxxx does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or
the Holders of a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding may petition any court of competent
jurisdiction at the expense of the Company for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Section 7.09 Successor Trustee by Xxxxxx. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets to, another corporation, the resulting,
surviving or transferee corporation without any further act shall be the
successor Trustee.
Section 7.10 Eligibility; Disqualification. The Trustee shall at all
times satisfy the requirements of TIA Sections 310(a)(1) and 310(b). The
Trustee (or its parent holding company) shall have a combined capital and
surplus of at least $50,000,000 as set forth in its most recent published
annual report of condition. Nothing herein contained shall prevent the Trustee
from filing with the Commission the application referred to in the penultimate
paragraph of TIA Section 310(b).
Section 7.11 Preferential Collection of Claims Against Company. The
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE 8
DISCHARGE OF INDENTURE
Section 8.01 Discharge of Liability on Securities. When (i) the
Company delivers to the Trustee all outstanding Securities (other than
Securities replaced pursuant to Section 2.07) for cancellation or (ii) all
outstanding Securities have become due and payable and the Company deposits
with the Trustee cash or, if expressly permitted by the terms of the Securities
or the Indenture, Common Stock (as applicable in accordance with the terms
hereof) sufficient to pay all amounts due and owing on all outstanding
Securities (other than Securities replaced pursuant to Section 2.07), and if in
either case the Company pays all other sums payable hereunder by the Company,
then this Indenture shall, subject to Section 7.07, cease to be of further
effect. The Trustee shall join in the execution of a document prepared by the
Company acknowledging satisfaction and discharge of this Indenture on demand of
the Company accompanied by an Officers' Certificate and Opinion of Counsel and
at the cost and expense of the Company.
Section 8.02 Repayment to the Company. The Trustee and the Paying
Agent shall return to the Company upon written request any money or securities
held by them for the payment of any amount with respect to the Securities that
remains unclaimed for two years,
46
subject to applicable unclaimed property law. After return to the Company,
Holders entitled to the money or securities must look to the Company for
payment as general creditors unless an applicable abandoned property law
designates another person and the Trustee and the Paying Agent shall have no
further liability to the Securityholders with respect to such money or
securities for that period commencing after the return thereof.
ARTICLE 9
AMENDMENTS
Section 9.01 Without Consent of Holders. The Company and the Trustee
may amend this Indenture or the Securities without the consent of any
Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
provided, however, that such amendment does not materially adversely
affect the rights of any Securityholder;
(2) to comply with Article 5 or Section 10.14;
(3) to secure the Company's obligations under the Securities and this
Indenture;
(4) to add to the Company's covenants for the benefit of the
Securityholders or to surrender any right or power conferred upon the
Company;
(5) to make any change to comply with the TIA, or any amendment
thereto, or to comply with any requirement of the SEC in connection with
the qualification of the Indenture under the TIA, or as necessary in
connection with the registration of the Securities under the Securities
Act; or
(6) to make any change that does not adversely affect the rights of
any Holders.
Section 9.02 With Consent of Holders. With the written consent of the
Holders of at least a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding, the Company and the Trustee may amend this
Indenture or the Securities. However, without the consent of each
Securityholder affected, an amendment to this Indenture or the Securities may
not:
(1) change the provisions of this Indenture that relate to modifying
or amending this Indenture;
(2) make any change in the manner of calculation or rate of accrual
of Original Issue Discount and Contingent Additional Principal, make any
change in the manner of calculation or rate of accrual of, or that
adversely affects the right to receive, Contingent Cash Interest, reduce
the rate of interest referred to in paragraph 1 of the Securities, or
extend the time for payment of Original Issue Discount, Contingent Cash
Interest, Contingent Additional Principal (including CAP-OID thereon) or
interest, if any, on any Security;
47
(3) reduce the Principal Amount at Maturity, the Issue Price, Accrued
Original Issue Discount, Contingent Cash Interest, if any, or accrued
Contingent Additional Principal or CAP-OID, if any, on, or change the
Stated Maturity of, any Security;
(4) reduce the Redemption Price, Purchase Price or Change in Control
Purchase Price of any Security;
(5) make any Security payable in money or securities other than that
stated in the Security;
(6) make any change in Section 6.04, Section 6.07 or this Section
9.02, except to increase any percentage set forth therein;
(7) make any change that adversely affects the right to convert any
Security;
(8) make any change that adversely affects the right to require the
Company to purchase the Securities in accordance with the terms thereof
and this Indenture;
(9) impair the right to institute suit for the enforcement of any
payment with respect to, or conversion of, the Securities;
(10) reduce the amount of principal payable upon acceleration of
maturity of the Securities following a Default.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section 9.02 becomes effective, the
Company shall mail to each Holder a notice briefly describing the amendment.
Section 9.03 Compliance with Trust Indenture Act. Every supplemental
indenture executed pursuant to this Article shall comply with the TIA.
Section 9.04 Revocation and Effect of Consents, Waivers and Actions.
Until an amendment, waiver or other action by Holders becomes effective, a
consent thereto by a Holder of a Security hereunder is a continuing consent by
the Holder and every subsequent Holder of that Security or portion of the
Security that evidences the same obligation as the consenting Xxxxxx's
Security, even if notation of the amendment, waiver or other action is not made
on the Security. However, any such Holder or subsequent Holder may revoke the
consent as to such Holder's Security or portion of the Security if the Trustee
receives the notice of revocation before the date as of which the amendment,
waiver or action is made effective. After an amendment, waiver or action
becomes effective, it shall bind every Securityholder.
Section 9.05 Notation on or Exchange of Securities. 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
48
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Board of
Directors, 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 9.06 Trustee to Sign Supplemental Indentures. The Trustee
shall sign any supplemental indenture authorized pursuant to this Article 9 if
the amendment contained therein does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If it does, the Trustee may, but need
not, sign such supplemental indenture. In signing such supplemental indenture
the Trustee shall receive, and (subject to the provisions of Section 7.01)
shall be fully protected in relying upon, in addition to the documents required
by Section 15.04, an Officers' Certificate and an Opinion of Counsel stating
that such amendment is authorized or permitted by this Indenture.
Section 9.07 Effect of Supplemental Indentures. Upon the execution of
any supplemental indenture under this Article, this Indenture shall be modified
in accordance therewith, and such supplemental indenture shall form a part of
this Indenture for all purposes; and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
ARTICLE 10
CONVERSION
Section 10.01 Conversion Privilege. A Holder of a Security may convert
such Security into shares of Common Stock at any time during the period stated
in paragraph 9 of the Securities, subject to the provisions of this Article 10.
The number of shares of Common Stock issuable upon conversion of a Security per
$1,000 of Principal Amount at Maturity thereof (the "Conversion Rate") shall be
that set forth in paragraph 9 in the Securities, subject to adjustment as
herein set forth.
A Holder may convert a portion of the Principal Amount at Maturity of
a Security if the portion is $1,000 or an integral multiple of $1,000.
Provisions of this Indenture that apply to conversion of all of a Security also
apply to conversion of a portion of a Security.
"Average Sale Price" means the average of the Sale Prices of the
Common Stock for the shorter of
(i) 30 consecutive trading days ending on the last full trading day
prior to the Time of Determination with respect to the rights, warrants or
options or distribution in respect of which the Average Sale Price is
being calculated, or
(ii) the period (x) commencing on the date next succeeding the first
public announcement of (a) the issuance of rights, warrants or options or
(b) the distribution, in each case, in respect of which the Average Sale
Price is being calculated and (y) proceeding through the last full trading
day prior to the Time of Determination with respect to the rights,
warrants or options or distribution in respect of which the Average Sale
Price is being calculated (excluding days within such period, if any,
which are not trading days), or
49
(iii) the period, if any, (x) commencing on the date next succeeding
the Ex-Dividend Time with respect to the next preceding (a) issuance of
rights, warrants or options or (b) distribution, in each case, for which
an adjustment is required by the provisions of Section 10.05(4), 10.06 or
10.07 and (y) proceeding through the last full trading day prior to the
Time of Determination with respect to the rights, warrants or options or
distribution in respect of which the Average Sale Price is being
calculated (excluding days within such period, if any, which are not
trading days).
In the event that the Ex-Dividend Time (or in the case of a subdivision,
combination or reclassification, the effective date with respect thereto) with
respect to a dividend, subdivision, combination or reclassification to which
Section 10.05(1), (2), (3) or (5) applies occurs during the period applicable
for calculating Average Sale Price pursuant to the definition in the preceding
sentence, Average Sale Price shall be calculated for such period in a manner
determined by the Board of Directors to reflect the impact of such dividend,
subdivision, combination or reclassification on the Sale Price of the Common
Stock during such period.
"Time of Determination" means the time and date of the earlier of (i)
the determination of stockholders entitled to receive rights, warrants or
options or a distribution, in each case, to which Section 10.07 or 10.08
applies and (ii) the time ("Ex-Dividend Time") immediately prior to the
commencement of "ex-dividend" trading for such rights, warrants or options or
distribution on the New York Stock Exchange or such other national or regional
exchange or market on which the Common Stock is then listed or quoted.
Section 10.02 Conversion Procedure. To convert a Security, a Holder
must satisfy the requirements in paragraph 9 of the Securities. The date on
which the Holder satisfies all those requirements is the conversion date (the
"Conversion Date"). The Conversion Agent shall notify the Company of the
Conversion Date within one Business Day of the Conversion Date. The Company
shall deliver to the Holder, through the Conversion Agent, no later than the
fifth Business Day following the Conversion Date, a certificate for the number
of full shares of Common Stock issuable upon the conversion and cash in lieu of
any fractional share determined pursuant to Section 10.03. The Person in whose
name the certificate representing such shares is registered shall be treated as
a stockholder of record on and after the Conversion Date; provided, however,
that no surrender of a Security on any date when the stock transfer books of
the Company shall be closed shall be effective to constitute the person or
persons entitled to receive the shares of Common Stock upon such conversion as
the record holder or holders of such shares of Common Stock on such date, but
such surrender shall be effective to constitute the person or persons entitled
to receive such shares of Common Stock as the record holder or holders thereof
for all purposes at the close of business on the next succeeding day on which
such stock transfer books are open; such conversion shall be at the Conversion
Rate in effect on the date that such Security shall have been surrendered for
conversion, as if the stock transfer books of the Company had not been closed.
Upon conversion of a Security, such person shall no longer be a Holder of such
Security.
No payment or adjustment will be made for accrued interest or
dividends on, or other distributions with respect to, any Common Stock except
as provided in this Article 10. On conversion of a Security, that portion of
Accrued Original Issue Discount and original issue discount, as imputed for
United States federal income tax purposes pursuant to
50
Section 1.275-4(b) of the Treasury Regulations and Contingent Additional
Principal, if any, attributable to the period from the Issue Date to, but
excluding, the Conversion Date and (except as provided below) that portion of
accrued Contingent Cash Interest attributable to the period from the last
Contingent Cash Interest Payment Date (or Issue Date, if such date has not
occurred) ("Contingent Cash Interest Payment Date") to but excluding the
Conversion Date with respect to the converted Security shall not be cancelled,
extinguished or forfeited, but rather shall be deemed to be paid in full to the
Holder thereof through delivery of the Common Stock (together with the cash
payment, if any, in lieu of fractional shares) in exchange for the Security
being converted pursuant to the provisions hereof; and the fair market value of
such shares of Common Stock (together with any such cash payment in lieu of
fractional shares) shall be treated as delivered pro rata, to the extent
thereof, first in exchange for Accrued Original Issue Discount and original
issue discount, as imputed for United States federal income tax purposes
pursuant to Section 1.275-4(b) of the Treasury Regulations and accrued
Contingent Additional Principal, if any, to, but excluding the Conversion Date
and accrued Contingent Cash Interest to, but excluding, the Conversion Date,
and the balance, if any, of such cash and/or the fair market value of such
Common Stock (together with any such cash payment in lieu of fractional shares)
shall be treated as delivered in exchange for the Issue Price of the Security
being converted pursuant to the provisions hereof. Notwithstanding the
foregoing, accrued but unpaid Contingent Cash interest will be payable upon
conversion of Securities made concurrently with or after acceleration of
Securities following an Event of Default.
If the Holder converts more than one Security at the same time, the
number of shares of Common Stock issuable upon the conversion shall be based on
the total Principal Amount at Maturity of the Securities converted.
A Security surrendered for conversion by a Holder during the period
from the close of business on any Common Stock Record Date to the opening of
business on the next Contingent Cash Interest Payment Date must be accompanied
by payment of an amount equal to the Contingent Cash Interest that the Holder
is to receive on the Securities surrendered for conversion, unless the Company
has provided such Holder with a notice of redemption with respect to such
Securities pursuant to Section 3.03 herein, in which case no such payment shall
be made.
If the last day on which a Security may be converted is a Legal
Holiday, the Security may be surrendered on the next succeeding day that is not
a Legal Holiday.
Upon surrender of a Security that is converted in part, the Company
shall execute, and the Trustee shall authenticate and deliver to the Holder, a
new Security in an authorized denomination equal in Principal Amount at
Maturity to the unconverted portion of the Security surrendered.
Section 10.03 Fractional Shares. The Company will not issue a
fractional share of Common Stock upon conversion of a Security. Instead, the
Company will deliver cash for the current market value of the fractional share.
The current market value of a fractional share shall be determined, to the
nearest 1/1,000th of a share, by multiplying the Sale Price of the Common
Stock, on the last trading day prior to the Conversion Date, of a full share by
the fractional amount and rounding the product to the nearest whole cent.
51
Section 10.04 Taxes on Conversion. If a Holder converts a Security,
the Company shall pay any documentary, stamp or similar issue or transfer tax
due on the issue of shares of Common Stock upon the conversion. However, the
Holder shall pay any such tax which is due because the Holder requests the
shares to be issued in a name other than the Holder's name. The Conversion
Agent may refuse to deliver the certificates representing the Common Stock
being issued in a name other than the Holder's name until the Conversion Agent
receives a sum sufficient to pay any tax which will be due because the shares
are to be issued in a name other than the Holder's name. Nothing herein shall
preclude any tax withholding required by law or regulations.
Section 10.05 Company to Provide Stock. The Company shall, prior to
issuance of any Securities under this Article 10, and from time to time as may
be necessary, reserve out of its authorized but unissued Common Stock a
sufficient number of shares of Common Stock to permit the conversion of the
Securities.
All shares of Common Stock delivered upon conversion of the Securities
shall be newly issued shares or treasury shares, shall be duly and validly
issued and fully paid and nonassessable and shall be free from preemptive
rights and free of any lien or adverse claim.
The Company will endeavor promptly to comply with all federal and
state securities laws regulating the offer and delivery of shares of Common
Stock upon conversion of Securities, if any, and will list or cause to have
quoted such shares of Common Stock on each national securities exchange or in
the over-the-counter market or such other market on which the Common Stock is
then listed or quoted.
Section 10.06 Adjustment for Change in Capital Stock. If, after the
Issue Date of the Securities, the Company:
(1) pays a dividend or makes a distribution on its Common Stock in
shares of its Common Stock;
(2) subdivides its outstanding shares of Common Stock into a greater
number of shares;
(3) combines its outstanding shares of Common Stock into a smaller
number of shares;
(4) pays a dividend or makes a distribution on its Common Stock in
shares of its Capital Stock (other than Common Stock or rights, warrants
or options for its Capital Stock); or
(5) issues by reclassification of its Common Stock any shares of its
Capital Stock (other than rights, warrants or options for its Capital
Stock),
then the conversion privilege and the Conversion Rate in effect immediately
prior to such action shall be adjusted so that the Holder of a Security
thereafter converted may receive the number of shares of Capital Stock of the
Company which such Holder would have owned immediately
52
following such action if such Xxxxxx had converted the Security immediately
prior to such action.
The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
If after an adjustment a Holder of a Security upon conversion of such
Security may receive shares of two or more classes of Capital Stock of the
Company, the Conversion Rate shall thereafter be subject to adjustment upon the
occurrence of an action taken with respect to any such class of Capital Stock
as is contemplated by this Article 10 with respect to the Common Stock, on
terms comparable to those applicable to Common Stock in this Article 10.
Section 10.07 Adjustment for Rights Issue. If after the Issue Date of the
Securities, the Company distributes any rights, warrants or options to all
holders of its Common Stock entitling them, for a period expiring within 60
days after the record date for such distribution, to purchase shares of Common
Stock at a price per share less than the Sale Price of the Common Stock as of
the Time of Determination, the Conversion Rate shall be adjusted in accordance
with the formula:
(O + N)
R' = R x ---------------
O + (N x P)/M
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
O = the number of shares of Common Stock outstanding on the
record date for the distribution to which this Section 10.07 is
being applied.
N = the number of additional shares of Common Stock offered pursuant
to the distribution.
P = the offering price per share of the additional shares.
M = the Average Sale Price, minus, in the case of (i) a
distribution to which Section 10.06(4) applies or (ii) a
distribution to which Section 10.08 applies, for which, in
each case, (x) the record date shall occur on or before the
record date for the distribution to which this Section 10.07
applies and (y) the Ex-Dividend Time shall occur on or after
the date of the Time of Determination for the distribution to
which this Section 10.07 applies, the fair market value (on
the record date for the distribution to which this Section
10.07 applies) of the:
(1) Capital Stock of the Company distributed in respect of each share
of Common Stock in such Section 10.06(4) distribution; and
53
(2) assets of the Company or Debt securities or any rights, warrants
or options to purchase securities of the Company distributed in respect of
each share of Common Stock in such Section 10.08 distribution.
The Board of Directors shall determine fair market values for the
purposes of this Section 10.07.
The adjustment shall become effective immediately after the record
date for the determination of shareholders entitled to receive the rights,
warrants or options to which this Section 10.07 applies. If all of the shares
of Common Stock subject to such rights, warrants or options have not been
issued when such rights, warrants or options expire, then the Conversion Rate
shall promptly be readjusted to the Conversion Rate which would then be in
effect had the adjustment upon the issuance of such rights, warrants or options
been made on the basis of the actual number of shares of Common Stock issued
upon the exercise of such rights, warrants or options.
No adjustment shall be made under this Section 10.07 if the
application of the formula stated above in this Section 10.07 would result in a
value of R' that is equal to or less than the value of R.
Section 10.08 Adjustment for Other Distributions. (a) If, after the
Issue Date of the Securities, the Company distributes to all holders of its
Common Stock any of its assets excluding distributions of Capital Stock or
equity interests referred to in Section 10.08(b), or evidences of indebtedness
of the Company or any rights, warrants or options to purchase securities of the
Company (including securities or cash, but excluding (x) distributions of
Capital Stock referred to in Section 10.06 and distributions of rights,
warrants or options referred to in Section 10.07 and (y) cash dividends or
other cash distributions that are paid out of consolidated current net earnings
or earnings retained in the business as shown on the books of the Company,
unless such cash dividends or other cash distributions are Extraordinary Cash
Dividends (as defined below)) (except for the above restrictions, "Regular Cash
Dividends") the Conversion Rate shall be adjusted, subject to the provisions of
Section 10.08(c), in accordance with the formula:
R' = R x M
-------
M - F
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the Average Sale Price, minus, in the case of a distribution
to which Section 10.06(4) applies, for which (i) the record
date shall occur on or before the record date for the
distribution to which this Section 10.08(a) applies and (ii)
the Ex-Dividend Time shall occur on or after the date of the
Time of Determination for the distribution to which this
Section 10.08(a) applies, the fair market value (on the record
date for the distribution to which this Section 10.08(a)
applies) of any
54
Capital Stock of the Company distributed in respect of each
share of Common Stock in such Section 10.06(4) distribution.
F = the fair market value (on the record date for the
distribution to which this Section 10.08(a) applies) of the
assets, securities, rights, warrants or options to be
distributed in respect of each share of Common Stock in the
distribution to which this Section 10.08(a) is being applied
(including, in the case of cash dividends or other cash
distributions giving rise to an adjustment, all such cash
distributed concurrently).
The Board of Directors shall determine fair market values for the
purposes of this Section 10.08(a).
The adjustment shall become effective immediately after the record
date for the determination of shareholders entitled to receive the distribution
to which this Section 10.09(a) applies.
For purposes of this Section 10.08(a), the term "Extraordinary Cash
Dividend" shall mean any cash dividend with respect to the Common Stock the
amount of which, together with the aggregate amount of cash dividends on the
Common Stock to be aggregated with such cash dividend in accordance with the
provisions of this paragraph, equals or exceeds the threshold percentage set
forth in item (i) below. For purposes of item (i) below, the "Measurement
Period" with respect to a cash dividend on the Common Stock shall mean the 365
consecutive day period ending on the date prior to the Ex-Dividend Time with
respect to such cash dividend, and the "Relevant Cash Dividends" with respect
to a cash dividend on the Common Stock shall mean the cash dividends on the
Common Stock with Ex-Dividend Times occurring in the Measurement Period.
(i) If, upon the date prior to the Ex-Dividend Time with respect to a
cash dividend on the Common Stock, the aggregate amount of such cash
dividend together with the amounts of all Relevant Cash Dividends equals
or exceeds on a per share basis the sum of (a) 5% of the Sale Price of the
Common Stock on the last Trading Day preceding the date of declaration by
the Board of Directors of the cash dividend or distribution with respect
to which this provision is being applied, and (b) the quotient of the
amount of any contingent interest paid on a Security during the
Ex-Dividend Measurement Period and divided by the conversion rate in
effect on the payment date of such relevant Contingent Interest Payment
Date, then such cash dividend together with all Relevant Cash Dividends,
shall be deemed to be an Extraordinary Cash Dividend and for purposes of
applying the formula set forth above in this Section 10.08(a), the value
of "F" shall be equal to (y) the aggregate amount of such cash dividend
together with the amount of all Relevant Cash Dividends, minus (z) the
aggregate amount of all Relevant Cash Dividends for which a prior
adjustment in the Conversion Rate was previously made under this Section
10.08(a).
In making the determinations required by item (i) above, the amount of
cash dividends paid on a per share basis and the amount of any Relevant
Cash Dividends specified in
55
item (i) above, shall be appropriately adjusted to reflect the occurrence
during such period of any event described in Section 10.06.
(b) If, after the Issue Date of the Securities, the Company pays a
dividend or makes a distribution to all holders of its Common Stock consisting
of Capital Stock of any class or series, or similar equity interests, of or
relating to a Subsidiary or other business unit of the Company, the Conversion
Rate shall be adjusted in accordance with the formula:
R' = R x (1 + F/M)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the average of the Post-Distribution Prices of the Common Stock
for the 10 trading days commencing on and including the fifth trading day after
the date on which "ex-dividend trading" commences for such dividend or
distribution on the principal United States exchange or market which such
securities are then listed or quoted (the "Ex-Dividend Date").
F = the fair market value of the securities distributed in respect of
each share of Common Stock for which this Section 10.08(b) shall mean the
number of securities distributed in respect of each share of Common Stock
multiplied by the average of the Post-Distribution Prices of those securities
distributed for the 10 trading days commencing on and including the fifth
trading day after the Ex-Dividend Date.
(c) "Post-Distribution Price" of Capital Stock or any similar equity
interest on any date means the closing per unit sale price (or, if no closing
sale price is reported, the average of the bid and ask prices or, if more than
one in either case, the average of the average bid and the average ask prices)
on such date for trading of such units on a "when issued" basis without due
bills (or similar concept) as reported in the composite transactions for the
principal United States securities exchange on which such Capital Stock or
equity interest is traded or, if the Capital Stock or equity interest, as the
case may be, is not listed on a United States national or regional securities
exchange, as reported by the National Association of Securities Dealers
Automated Quotation System or by the National Quotation Bureau Incorporated;
provided that if on any date such units have not traded on a "when issued"
basis, the Post-Distribution Price shall be the closing per unit sale price
(or, if no closing sale price is reported, the average of the bid and ask
prices or, if more than one in either case, the average of the average bid and
the average ask prices) on such date for trading of such units on a "regular
way" basis without due bills (or similar concept) as reported in the composite
transactions for the principal United States securities exchange on which such
Capital Stock or equity interest is traded or, if the Capital Stock or equity
interest, as the case may be, is not listed on a United States national or
regional securities exchange, as reported by the National Association of
Securities Dealers Automated Quotation System or by the National Quotation
Bureau Incorporated. In the absence of such quotation, the Company shall be
entitled to determine the Post-Distribution Price on the basis of such
quotations, which reflect the post-distribution value of the Capital Stock or
equity interests, as it considers appropriate.
56
Section 10.09 When Adjustment May Be Deferred. No adjustment in the
Conversion Rate need be made unless the adjustment would require an increase or
decrease of at least 1% in the Conversion Rate. Any adjustments that are not
made shall be carried forward and taken into account in any subsequent
adjustment.
All calculations under this Article 10 shall be made to the nearest
cent or to the nearest 1/1,000th of a share, as the case may be (with one-half
of a cent and 5/10,000ths of a share being rounded upward).
Section 10.10 When No Adjustment Required. No adjustment need be made
for a transaction referred to in Section 10.06, 10.07, 10.08, 10.14 or 10.19 if
Securityholders are to participate in the transaction on a basis and with
notice that the Board of Directors determines to be fair and appropriate in
light of the basis and notice on which holders of Common Stock participate in
the transaction. Such participation by Securityholders may include
participation upon conversion provided that an adjustment shall be made at such
time as the Securityholders are no longer entitled to participate.
No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value or no par
value of the Common Stock.
The Company is not required to make an adjustment until adjustments
greater 1% have occurred.
To the extent the Securities become convertible pursuant to this
Article 10 into cash, no adjustment need be made thereafter as to the cash.
Interest will not accrue on the cash. The Conversion Rate shall not be adjusted
for any Accrued Original Issue Discount, Contingent Additional Principal, if
any, or Contingent Cash Interest.
Section 10.11 Notice of Adjustment. Whenever the Conversion Rate is
adjusted, the Company shall promptly mail to Securityholders a notice of the
adjustment. The Company shall file with the Trustee and the Conversion Agent
such notice and a certificate from the Company's independent public accountants
briefly stating the facts requiring the adjustment and the manner of computing
it. The certificate shall be conclusive evidence that the adjustment is
correct. Neither the Trustee nor any Conversion Agent shall be under any duty
or responsibility with respect to any such certificate except to exhibit the
same to any Holder desiring inspection thereof.
Section 10.12 Voluntary Increase. The Company from time to time may
increase the Conversion Rate by any amount for any period of time. Whenever the
Conversion Rate is increased, the Company shall mail to Securityholders and
file with the Trustee and the Conversion Agent a notice of the increase. The
Company shall mail the notice at least 15 days before the date the increased
Conversion Rate takes effect. The notice shall state the increased Conversion
Rate and the period it will be in effect.
57
A voluntary increase of the Conversion Rate does not change or adjust
the Conversion Rate otherwise in effect for purposes of Section 10.06, 10.07 or
10.08.
Section 10.13 Notice of Certain Transactions. If:
(1) the Company takes any action that would require an adjustment in
the Conversion Rate pursuant to Section 10.06, 10.07 or 10.08 (unless no
adjustment is to occur pursuant to Section 10.10); or
(2) the Company takes any action that would require a supplemental
indenture pursuant to Section 10.14; or
(3) there is a liquidation or dissolution of the Company;
then the Company shall mail to Securityholders and file with the Trustee and
the Conversion Agent a notice stating the proposed record date for a dividend
or distribution or the proposed effective date of a subdivision, combination,
reclassification, consolidation, merger, binding share exchange, transfer,
liquidation or dissolution. The Company shall file and mail the notice at least
20 days before such date. Failure to file or mail the notice or any defect in
it shall not affect the validity of the transaction.
Section 10.14 Reorganization of Company; Special Distributions. If the
Company is a party to a transaction subject to Section 5.01 (other than a sale
of all or substantially all of the assets of the Company in a transaction in
which the holders of Common Stock immediately prior to such transaction do not
receive securities, cash or other assets of the Company or any other person) or
a merger or binding share exchange which reclassifies or changes the
outstanding Common Stock, the person obligated to deliver securities, cash or
other assets upon conversion of Securities shall enter into a supplemental
indenture. If the issuer of securities deliverable upon conversion of
Securities is an Affiliate of the successor Company, that issuer shall join in
the supplemental indenture.
The supplemental indenture shall provide that the Holder of a Security
may convert it into the kind and amount of securities, cash or other assets
which such Holder would have received immediately after the consolidation,
merger, binding share exchange or transfer if such Holder had converted the
Security immediately before the effective date of the transaction, assuming (to
the extent applicable) that such Holder (i) was not a constituent person or an
Affiliate of a constituent person to such transaction; (ii) made no election
with respect thereto; and (iii) was treated alike with the plurality of
non-electing Holders. The supplemental indenture shall provide for adjustments
which shall be as nearly equivalent as may be practical to the adjustments
provided for in this Article 10. The successor Company shall mail to
Securityholders a notice briefly describing the supplemental indenture.
If this Section applies, neither Section 10.06 nor 10.07 applies.
If the Company makes a distribution to all holders of its Common Stock
of any of its assets, or Debt securities or any rights, warrants or options to
purchase securities of the Company that, but for the provisions of Section
10.08(c), would otherwise result in an adjustment in the Conversion Rate
pursuant to the provisions of Section 10.08, then, from and after the record
date
58
for determining the holders of Common Stock entitled to receive the
distribution, a Holder of a Security that converts such Security in accordance
with the provisions of this Indenture shall upon such conversion be entitled to
receive, in addition to the shares of Common Stock into which the Security is
convertible, the kind and amount of securities, cash or other assets comprising
the distribution that such Holder would have received if such Holder had
converted the Security immediately prior to the record date for determining the
holders of Common Stock entitled to receive the distribution.
Section 10.15 Company Determination Final. Any determination that the
Company or the Board of Directors must make pursuant to Section 10.03, 10.06,
10.07, 10.08, 10.09, 10.10, 10.14 or 10.17 is conclusive.
Section 10.16 Trustee's Adjustment Disclaimer. The Trustee has no duty
to determine when an adjustment under this Article 10 should be made, how it
should be made or what it should be. The Trustee has no duty to determine
whether a supplemental indenture under Section 10.14 need be entered into or
whether any provisions of any supplemental indenture are correct. The Trustee
shall not be accountable for and makes no representation as to the validity or
value of any securities or assets issued upon conversion of Securities. The
Trustee shall not be responsible for the Company's failure to comply with this
Article 10. Each Conversion Agent shall have the same protection under this
Section 10.16 as the Trustee.
Section 10.17 Simultaneous Adjustments. In the event that this Article
10 requires adjustments to the Conversion Rate under more than one of Sections
10.06(4), 10.07 or 10.08, and the record dates for the distributions giving
rise to such adjustments shall occur on the same date, then such adjustments
shall be made by applying, first, the provisions of Section 10.06, second, the
provisions of Section 10.08 and, third, the provisions of Section 10.07.
Section 10.18 Successive Adjustments. After an adjustment to the
Conversion Rate under this Article 10, any subsequent event requiring an
adjustment under this Article 10 shall cause an adjustment to the Conversion
Rate as so adjusted.
Section 10.19 Rights Issued in Respect of Common Stock Issued Upon
Conversion. Each share of Common Stock issued upon conversion of Securities
pursuant to this Article 10 shall be entitled to receive the appropriate number
of rights ("Rights"), if any, and the certificates representing the Common
Stock issued upon such conversion shall bear such legends, if any, in each case
as may be provided by the terms of any shareholder rights agreement adopted by
the Company, as the same may be amended from time to time (in each case, a
"Rights Agreement"). Provided that such Rights Agreement requires that each
share of Common Stock issued upon conversion of Securities at any time prior to
the distribution of separate certificates representing the Rights be entitled
to receive such Rights, then, notwithstanding anything else to the contrary in
this Article 10, there shall not be any adjustment to the conversion privilege
or Conversion Rate as a result of the issuance of Rights, the distribution of
separate certificates representing the Rights, the exercise or redemption of
such Rights in accordance with any such Rights Agreement, or the termination or
invalidation of such Rights.
59
ARTICLE 11
SUBORDINATION
Section 11.01 Securities Subordinate to Senior Indebtedness. The
Company covenants and agrees, and each Holder of a Security, by his acceptance
thereof, likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Article 11, the indebtedness represented by the
Securities and the payment of the Principal Amount at Maturity, Issue Price,
Accrued Original Issue Discount, Redemption Price, Purchase Price, Change in
Control Purchase Price, Contingent Cash Interest and Contingent Additional
Principal, if any, in respect of each and all of the Securities are hereby
expressly made subordinate and subject in right of payment to the prior payment
in full of all Senior Indebtedness of the Company, as the case may be.
Section 11.02 Payment over of Proceeds upon Dissolution, Etc. Upon any
distribution of assets of the Company in the event of:
(a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding
in connection therewith, relative to the Company or to its respective
creditors, as such, or to its respective assets, or
(b) any liquidation, dissolution or other winding-up of the Company,
whether voluntary or involuntary and whether or not involving insolvency or
bankruptcy, or
(c) any assignment for the benefit of creditors or any other
marshalling of assets and liabilities of the Company, or
(d) any other event that would constitute an Event of Default
specified in Section 6.01(5) or 6.01(6),
then, and in any such event, the holders of Senior Indebtedness shall be
entitled to receive:
(1) payment in full in cash of all amounts due or to become due on or
in respect of all Senior Indebtedness in cash or cash equivalents, or
provision shall be made for such payment, before the Holders of the
Securities are entitled to receive any payment on account of the Principal
Amount at Maturity, Issue Price, Accrued Original Issue Discount,
Redemption Price, Purchase Price, Change of Control Purchase Price
Contingent Cash Interest and Contingent Additional Principal, if any, in
respect of the Securities, and
(2) any payment or distribution of any kind or character, whether in
cash, property or securities, which may be payable or deliverable in
respect of the Securities in any such case, proceeding, dissolution,
liquidation or other winding-up or event, including any such payment or
distribution which may be payable or deliverable by reason of the payment
of any other indebtedness of the Company being subordinated to the payment
of the Securities.
In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the
60
Company of any kind or character, whether in cash, property or securities,
including any such payment or distribution which may be payable or deliverable
by reason of the payment of any other indebtedness of the Company being
subordinated to the payment of the Securities, before all Senior Indebtedness
is paid in full in cash or payment thereof provided for, and if such fact
shall, at or prior to the time of such payment or distribution, have been made
known to the Trustee or, as the case may be, such Holder, then, in such event,
such payment or distribution shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, Custodian, assignee,
agent or other Person making payment or distribution of assets of the Company
for application to the payment of all Senior Indebtedness remaining unpaid, to
the extent necessary to pay all Senior Indebtedness in full in cash or as
payment thereof is otherwise provided for (as such phrase is defined below),
after giving effect to any concurrent payment or distribution to or for the
holders of Senior Indebtedness.
For purposes of this Article 11 only, the words "cash, property or
securities" shall not be deemed to include shares of Capital Stock of the
Company, as reorganized or readjusted, or securities of the Company or any
other corporation provided for by a plan or reorganization or readjustment the
payment of which is subordinated, at least to the extent provided in this
Article 11 with respect to the Securities, to the payment of all Senior
Indebtedness which may at the time be outstanding; provided, however, that (i)
Senior Indebtedness is assumed by the new corporation, if any, resulting from
any such reorganization or readjustment, and (ii) the rights of the holders of
the Senior Indebtedness are not, without the consent of such holders, altered
by such reorganization or readjustment.
The consolidation or share exchange of the Company with, or the merger
of the Company into, another person or the liquidation or dissolution of the
Company following the conveyance or transfer of its properties and assets
substantially as an entirety to another person upon the terms and conditions
set forth in Article 5 shall not be deemed a dissolution, winding-up,
liquidation, reorganization, assignment for the benefit of creditors or
marshalling of assets and liabilities of the Company for the purposes of this
Section if the person formed by such consolidation or share exchange or into
which the Company is merged or the person which acquires by conveyance or
transfer such properties and assets of the Company, as the case may be,
substantially as an entirety, as the case may be, shall; as part of such
consolidation, share exchange, merger, conveyance or transfer, comply with the
conditions set forth in Article 5.
Section 11.03 Acceleration of Securities. In the event that any
Securities are declared due and payable before their Stated Maturity pursuant
to Section 6.02, then and in such event the Company shall promptly notify
holders of Senior Indebtedness of such acceleration. The Company may not pay
the Securities until the earlier of (i) 120 days after the date of such
acceleration or (ii) the payment in full of all Senior Indebtedness or as
payment thereof is otherwise provided for (as such phrase is defined below),
and may thereafter pay the Securities if this Indenture permits the payment at
that time.
In the event that, notwithstanding the foregoing, (a) the Company
shall make any payment to the Trustee or the Holder of any Securities
prohibited by the foregoing provisions of this Section 11.03, and (b) with
respect to any payment made before 120 days after the date of such
acceleration, if such facts shall, at or prior to the time of such payment,
have been made known to the Trustee or, as the case may be, such Holder, then
and in such event such payment
61
shall be paid over and delivered forthwith to the Company by or on behalf of
the person holding such payment for the benefit of the holders of Senior
Indebtedness.
The provisions of this Section 11.03 shall not apply to any payment
with respect to which Section 11.04 would be applicable.
Section 11.04 Default on Senior Indebtedness. The Company may not make
any payment of the Principal Amount at Maturity, Issue Price, Accrued Original
Issue Discount, Redemption Price, Change of Control Purchase Price, Contingent
Cash Interest or Contingent Additional Principal, if any, in respect of the
Securities and may not pay cash with respect to the Purchase Price of any
Security (other than for fractional shares) or otherwise acquire any Securities
for cash or property (except as set forth in this Indenture) if:
(1) any payment default on any Senior Indebtedness has occurred and
is continuing beyond any applicable grace period with respect thereto; or
(2) a default (other than a default referred to in the preceding
clause (1)) on any Senior Indebtedness occurs and is continuing that
permits holders of such Senior Indebtedness to accelerate the maturity
thereof and the default is the subject of judicial proceedings or the
Company receives a notice of default thereof from any person who may give
such notice pursuant to the instrument evidencing or document governing
such Senior Indebtedness.
If the Company receives any such notice, then a similar notice received within
nine months thereafter relating to the same default on the same issue of Senior
Indebtedness shall not be effective for purposes of this Section 11.04.
Notwithstanding the foregoing, the Company may resume payment on the
Securities and may acquire Securities if and when:
(a) the default referred to above is cured or waived as provided or
permitted in accordance with the terms of the applicable Senior Indebtedness;
or
(b) in the case of a default referred to in clause (2) of the
preceding paragraph, 179 or more days pass after the receipt by the Company of
the notice described in clause (2) above; and
this Indenture otherwise permits the payment or acquisition at that time;
provided, however, that with respect to payments made after the 179-day period
referred to in clause (b) of this Section 11.04, the Trustee or the Holder of
any Securities shall pay over and deliver forthwith to the Company for the
benefit of the holders of Senior Indebtedness any amounts received by the
Trustee or any such Holder to the extent necessary to pay all holders of Senior
Indebtedness in full in cash or otherwise provide for such payment thereof (as
such phrase is defined above).
In the event that, notwithstanding the foregoing, (a) the Company
shall make any payment to the Trustee or the Holder of any Security prohibited
by the foregoing provisions of this Section, and (b) with respect to any
payment made after the expiration of the 179-day period if such fact shall
then have been made known to the Trustee or, as the case may be, such Holder,
62
then and in such event such payment shall (to the extent permitted by law) be
paid over and delivered forthwith to the Company by or on behalf of the person
holding such payment for the benefit of the holders of the Senior Indebtedness.
The provisions of this Section shall not apply to any payment with
respect to which Section 11.02 would be applicable.
Section 11.05 Payment Permitted if No Default. Nothing contained in
this Article 11 or elsewhere in this Indenture or in any of the Securities
shall prevent (a) the Company at any time except during the pendency of any
case, proceeding, dissolution, liquidation or other winding-up, assignment for
the benefit of creditors or other marshalling of assets and liabilities of the
Company referred to in Section 11.02 or under the conditions described in
Section 11.03 or 11.04, from making payments at any time of Principal Amount at
Maturity, Issue Price, Accrued Original Issue Discount, Redemption Price,
Purchase Price, Change of Control Purchase Price, Contingent Cash Interest or
Contingent Additional Principal, if any, as the case may be, in respect of the
Securities if the Trustee did not, at the time of such application, have actual
knowledge that such payment would have been prohibited by the provisions of
this Article 11 or (b) the application by the Trustee of any money deposited
with it hereunder to payment of or on account of the Principal Amount at
Maturity, Issue Price, Accrued Original Issue Discount, Redemption Price,
Purchase Price, Change in Control Purchase Price, Contingent Cash Interest or
Contingent Additional Principal, if any, as the case may be, in respect of the
Securities, or the retention of such payment by the Holders of the Securities,
if, at the time of such application by the Trustee, the Trustee did not have
actual knowledge that such payment would have been prohibited by the provisions
of this Article 11.
Section 11.06 Subrogation to Rights of Holders of Senior Indebtedness.
Subject to payment in full of all Senior Indebtedness to the extent and in the
manner set forth in this Article 11, the Holders of the Securities shall be
subrogated to the extent of the payments or distributions made to the holders
of such Senior Indebtedness pursuant to the provisions of this Article 11
(equally and ratably with the holders of all indebtedness of the Company which
by its express terms is subordinated to indebtedness of the Company to
substantially the same extent as the Securities are subordinated and is
entitled to like rights of subrogation) to the rights of the holders of such
Senior Indebtedness to receive payments or distributions of cash, property and
securities applicable to the Senior Indebtedness until the Principal Amount at
Maturity, Issue Price, Accrued Original Issue Discount, Redemption Price,
Purchase Price, Change of Control Purchase Price, Contingent Cash Interest or
Contingent Additional Principal, if any, as the case may be, in respect of the
Securities shall be paid in full. For purposes of such subrogation, no payments
or distributions to the holders of the Senior Indebtedness of any cash,
property or securities to which the Holders of the Securities or the Trustee
would be entitled except for the provisions of this Article 11, and no payments
over pursuant to the provisions of this Article 11 to the holders of Senior
Indebtedness by Holders of the Securities or the Trustee, shall, as among the
Company, the creditors of the Company, other than holders of Senior
Indebtedness and the Holders of the Securities, be deemed to be a payment or
distribution by the Company to or on account of the Senior Indebtedness.
Section 11.07 Provisions Solely to Define Relative Rights. The
provisions of this Article 11 are intended solely for the purpose of defining
the relative rights of the Holders of the
63
Securities, on the one hand, and the holders of Senior Indebtedness, on the
other hand. Nothing contained in this Article 11 or elsewhere in this Indenture
or in the Securities is intended to or shall (a) impair, as among the Company,
the creditors of the Company other than holders of Senior Indebtedness and the
Holders of the Securities, the obligation of the Company, which is absolute and
unconditional, to pay to the Holders of the Securities the Principal Amount at
Maturity, Issue Price, Accrued Original Issue Discount, Redemption Price,
Purchase Price, Change of Control Purchase Price, Contingent Cash Interest or
Contingent Additional Principal (or CAP-OID thereon), if any, as the case may
be, in respect of the Securities as and when the same shall become due and
payable in accordance with the terms of the Securities and this Indenture; or
(b) affect the relative rights against the Company of the Holders of the
Securities and creditors of the Company other than the holders of Senior
Indebtedness; or (c) prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article 11 of
the holders of Senior Indebtedness to receive cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder.
Section 11.08 Trustee to Effectuate Subordination. Each Holder of a
Security by his acceptance thereof authorizes and directs the Trustee on his
behalf to take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article 11 and appoints the Trustee his
attorney-in-fact for any and all such purposes.
Section 11.09 No Waiver of Subordination Provisions. No right of any
present or future holder of any Senior Indebtedness to enforce subordination as
herein provided shall at any time in any way be prejudiced or impaired by any
act or failure to act on the part of the Company or by any act or failure to
act by any such holder, or by any non-compliance by the Company with the terms,
provisions and covenants of this Indenture, regardless of any knowledge thereof
any such holder may have or be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article
11 or the obligations hereunder of the Holders of the Securities to the holders
of Senior Indebtedness, do any one or more of the following: (i) change the
manner, place or terms of payment or extend the time of payment of, or renew,
increase or alter, Senior Indebtedness, or otherwise amend or supplement in any
manner Senior Indebtedness or any instrument evidencing the same or any
agreement under which Senior Indebtedness is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Indebtedness; (iii) release any person liable in any manner for
the collection of Senior Indebtedness; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
Section 11.10 Notice to Trustee. The Company shall give prompt written
notice to a Responsible Officer of the Trustee of any facts known to the
Company, which would prohibit the making of any payment to or by the Trustee in
respect of the Securities. Notwithstanding the provisions of this Article 11 or
any other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts which would prohibit the making of any
payment to or by the Trustee in respect of the Securities, unless and until the
Trustee shall have
64
received written notice thereof from the Company, or a holder of Senior
Indebtedness or from any trustee therefor; and, prior to the receipt of any
such written notice, the Trustee shall be entitled in all respects to assume
that no such facts exist.
The Trustee shall be entitled to conclusively rely on the delivery to
it of a written notice by a person representing himself to be a holder of
Senior Indebtedness (or a trustee therefor) to establish that such notice has
been given by a holder of Senior Indebtedness (or a trustee therefor). In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Article 11, the Trustee may request such person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness
held by such person, the extent to which such person is entitled to participate
in such payment or distribution and any other facts pertinent to the rights of
such person under this Article 11, and if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
Section 11.11 Reliance on Judicial Order or Certificate of Liquidating
Agent. Upon any payment or distribution of assets of the Company referred to in
this Article 11, the Trustee and the Holders of the Securities shall be
entitled to rely upon any final, nonappealable order or decree entered by any
court of competent jurisdiction in which such insolvency, bankruptcy,
receivership, liquidation, reorganization, dissolution, winding-up or similar
case or proceeding is pending, or a certificate of the trustee in bankruptcy,
liquidating trustee, Custodian, receiver, assignee for the benefit of
creditors, agent or other Person making such payment or distribution, delivered
to the Trustee or to the Holders of Securities, for the purpose of ascertaining
the persons entitled to participate in such payment or distribution, the
holders of the Senior Indebtedness and other indebtedness of the Company, the
amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article 11.
Section 11.12 Trustee Not Fiduciary for Holders of Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if
it shall in good faith mistakenly pay over or distribute to Holders of
Securities or to the Company or to any other person cash, property or
securities to which any holders of Senior Indebtedness shall be entitled by
virtue of this Article 11 or otherwise. The Trustee shall not be charged with
knowledge of the existence of Senior Indebtedness or of any facts that would
prohibit any payment hereunder or that would permit the resumption of any such
payment unless a Responsible Officer of the Trustee shall have received notice
to that effect at the address of the Trustee set forth in Section 15.02. With
respect to the holders of Senior Indebtedness, the Trustee undertakes to
perform or to observe only such of its covenants or obligations as are
specifically set forth in this Article 11 and no implied covenants or
obligations with respect to holders of Senior Indebtedness shall be read into
this Indenture against the Trustee.
Section 11.13 Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights. The Trustee in its individual capacity shall
be entitled to all the rights set forth in this Article 11 with respect to any
Senior Indebtedness which may at any time be held by it, to
65
the same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 7.07.
Section 11.14 Article 11 Applicable to Paying Agents. In case at any
time any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term "Trustee" as used in this
Article 11 shall in such case (unless the context otherwise requires) be
construed as extending to and including such Paying Agent within its meaning as
fully for all intents and purposes as if such Paying Agent were named in this
Article 11 in addition to or in place of the Trustee; provided, however, that
Sections 11.10 and 11.12 shall not apply to the Company or an Affiliate of the
Company if the Company or any such Affiliate acts as Paying Agent.
ARTICLE 12
PAYMENT OF INTEREST
Section 12.01 Interest Payments. If applicable Contingent Cash
Interest, if any, on any Security that is payable in cash, and is punctually
paid or duly provided for, on the Contingent Cash Interest Payment Date shall
be paid to the person in whose name that Security is registered at the close of
business on the Common Stock Record Date or Contingent Cash Interest Payment
Date, as the case may be, for such interest at the office or agency of the
Company maintained for such purpose. Contingent Cash Interest, if any, on any
Security shall be paid in same-day funds by transfer to an account maintained
by the payee located inside the United States, if the Trustee shall have
received proper wire transfer instructions from such payee not later than the
related Common Stock Record Date or Contingent Cash Interest Record Date
accrual date, as the case may be, or, if no such instructions have been
received, by check drawn on a bank in New York City mailed to the payee at its
address set forth on the Registrar's books. In the case of a permanent Global
Security, Contingent Cash Interest, if any, payable on any applicable payment
date will be paid to the Depositary, with respect to that portion of such
permanent Global Security held for its account by Cede & Co. for the purpose of
permitting such party to credit the interest received by it in respect of such
permanent Global Security to the accounts of the beneficial owners thereof
Section 12.02 Defaulted Interest. Except as otherwise specified with
respect to the Securities, any Contingent Cash Interest on any Security that is
payable, but is not punctually paid or duly provided for, within 30 days
following any applicable Contingent Cash Interest Payment Date (herein called
"Defaulted Interest", which term shall include any accrued and unpaid interest
that has accrued on such defaulted amount in accordance with paragraph 1 of the
Securities), shall forthwith cease to be payable to the registered Holder
thereof on the relevant Common Stock Record Date or Contingent Cash Interest
Record Date, as the case may be, 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 are registered at the close
of business on a special
66
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 (which shall not be less
than 20 days after such notice is received by the Trustee), 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 on or 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 (the "Special Record Date")
for 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, to each Holder of Securities at his address as it appears
on the list of Securityholders maintained pursuant to Section 2.05 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
therefore having been mailed as aforesaid, such Defaulted Interest shall
be paid to the persons in whose names the 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 on the
Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such Securities may be
listed, and upon such notice as may be required by such exchange, if,
after notice given by the Company to the Trustee of the proposed payment
pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
Section 12.03 Interest Rights Preserved. Subject to the foregoing
provisions of this Article 12 and Section 2.06, 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 Contingent Cash Interest
accrued and unpaid and Contingent Additional Principal which were carried by
such other Security.
ARTICLE 13
CONTINGENT CASH INTEREST
Section 13.01 Contingent Cash Interest. Commencing after September 11,
2006, the Company shall make payments of additional interest to the Holders of
Securities ("Contingent Cash Interest"), as set forth in Section 13.02 below,
during any six month period from September 12 to March 11 and from March 12 to
September 11 (each a "Semi-annual Period") if, but only if, the average XXXXx
Market Price of a Security with $1,000 Principal Amount at Maturity for the
five trading days in the relevant Five-Trading-Day Measurement Period (as
defined below) equals 120% or more of the Relevant Value of such Security.
During any Semi-annual Period when Contingent Cash Interest is payable pursuant
to this section, each Contingent
67
Cash Interest payment due and payable on each $1,000 Principal Amount at
Maturity of Security shall be calculated for any quarterly period of the
applicable Semi-annual Period, and in each instance shall equal the greater of
(i) 0.0625% of the average XXXXx Market Price for the relevant Five-Trading-Day
Measurement Period or (ii) the sum of all Regular Cash Dividends paid by the
Company per share on the Common Stock during the applicable quarter of such
Semi-annual Period multiplied by the then applicable Conversion Rate, provided,
however, that if Regular Cash Dividends are not paid in such Semi-annual
Period, the Contingent Cash Interest shall be paid semi-annually at a rate of
0.125% of the average XXXXx Market Price for the Semi-annual Period. Contingent
Cash Interest shall accrue and be payable as of the record date, which shall be
the 15th day preceding the last day of the relevant Semi-annual Period or if
the Company pays a regular cash dividend on its Common Stock during a quarter
within the relevant Semi-annual Period, to holders of Securities as of the
record date for such Common Stock dividend.
As used in this Article 13, "Five-Trading-Day Measurement Period"
means the five trading days ending on the third trading day immediately
preceding the first day of the applicable Semi-annual Period; provided,
however, that if the Company declares a dividend on its Common Stock for which
the record date for such dividend (the "Common Stock Record Date") falls prior
to the first day of the next Semi-annual Period, but the payment date for such
dividend falls within such Semi-annual Period, then, the "Five-Trading-Day
Measurement Period" shall mean the five trading days ending on the third
trading day immediately preceding such Common Stock Record Date. "Relevant
Value" means the sum of the Issue Price, the Accrued Original Issue Discount
and accrued Contingent Additional Principal, if any, on such Security as of the
day immediately preceding the first day of the applicable Semi-annual Period.
"XXXXx Market Price" means, as of any date of determination, the average of the
secondary market bid quotations per $1,000 Principal Amount at Maturity of
Securities obtained by the Bid Solicitation Agent for $10 million Principal
Amount at Maturity of Securities at approximately 4:00 p.m., New York City
time, on such determination date from three independent nationally recognized
securities dealers (none of which shall be an Affiliate of the Company)
selected by the Company; provided, however, that if (a) at least three such
bids are not obtained by the Bid Solicitation Agent or (b) in the Company's
reasonable judgment, the bid quotations are not indicative of the secondary
market value of the Securities as of such determination date, then the XXXXx
Market Price for such determination date shall equal the product of (i) the
Conversion Rate in effect as of such determination date multiplied by (ii) the
average Sale Price of the Common Stock for the five trading days ending on such
determination date, appropriately adjusted to take into account the occurrence,
during the period commencing on the first of such trading days during such five
trading day period and ending on such determination date, of any event
described in Section 10.06, 10.07 or 10.08 (subject to the conditions set forth
in Sections 10.09 and 10.10).
The Original Issue Discount of the Securities will continue to accrue
whether or not Contingent Cash Interest payments are made or are payable.
Section 13.02 Payment of Contingent Cash Interest; Contingent Cash
Interest Rights Preserved. If payable, Contingent Cash Interest shall be
payable as of the record date, which shall be the 15th day preceding the last
day of the relevant Semi-annual Period (in each case, a "Contingent Cash
Interest Payment Date") or, if the Company pays a Regular Cash Dividend on
68
the Common Stock during a quarter within a Semi-annual Period, on the record
date for the related Common Stock dividend. Contingent Cash Interest payments
on any Security that are payable, and are punctually paid or duly provided for,
on any Contingent Cash Interest Payment Date shall be paid to the Person who is
the Holder of that Security on the 15th day preceding the last day of such
Semi-annual Period (the "Contingent Cash Interest Record Date") or, if the
Company pays regular cash dividends on the Common Stock during one quarter
within such Semi-annual Period, the Common Stock Record Date. Each payment of
Contingent Cash Interest on any Security shall be paid (A) if such Security is
held in the form of a Global Security, in same-day funds by transfer to an
account maintained by the payee located inside the United States, or (B) if
such Security is held in the form of a Certificated Note, by check, mailed to
the address of such Holder as set forth in the Security Register. In the case
of a Global Security, interest payable on any Contingent Cash Interest Payment
Date will be paid to the Depositary for the purpose of permitting DTC to credit
the interest received by it in respect of such Global Security to the accounts
of the beneficial owners thereof. If the Company only pays a Regular Cash
Dividend on the Common Stock during one quarter within such Semi-annual Period,
the remaining Contingent Cash Interest payments, if any, will accrue and be
payable as of the 15th day preceding the last day of such Semi-annual Period.
Upon determination that Holders of Securities will be entitled to
receive Contingent Cash Interest during a Semi-annual Period, prior to the
start of such Semi-annual Period, the Company will issue a press release and
publish such information on its Web site or through such other public medium as
the Company may use at that time.
Section 13.03 Bid Solicitation Agent. The Bid Solicitation Agent shall
solicit bids from securities dealers, which the Company indicates that it
believes are willing to bid for the Securities. The Company initially appoints
the Trustee to act as the Bid Solicitation Agent. The Company may change the
Bid Solicitation Agent at its discretion; provided, however, that the Bid
Solicitation Agent may not be an Affiliate of the Company.
ARTICLE 14
CONTINGENT ADDITIONAL PRINCIPAL
Section 14.01 Contingent Additional Principal. On September 11, 2004,
the rate of accrual on the XXXXx will be reset for a period of two years (the
"Adjusted Rate"), if the Company's Stock Price Factor (as defined below) is at
or below the Stock Price Factor thresholds set forth in the table below. The
amount that accrues as a result of the Adjusted Rate of accrual on the XXXXx,
other than Original Issue Discount, is referred to herein as "Contingent
Additional Principal". If Contingent Additional Principal accrues, the Adjusted
Rate on the Securities shall accrue commencing on September 11, 2004. If the
Stock Price Factor is greater than the highest Stock Price Factor threshold in
the applicable column set forth in the table below, no Contingent Additional
Principal shall accrue and Original Issue Discount only shall accrue as
provided herein.
If Contingent Additional Principal accrues, the Adjusted Rate of
accrual per Security will be the rate which results from deducting an amount in
accordance with the left hand column of the table below, from the Company's
Subordinated Debt Rate (as defined below), provided that in no event shall the
Adjusted Rate be greater than 9.0% or less than the initial yield to maturity
69
of 2.0%. In determining the appropriate row in the column in the table below
containing the amount to be deducted from the Company's Subordinated Debt Rate,
reference shall be made only to that corresponding row containing the highest
Stock Price Factor threshold (within the appropriate Subordinated Debt Rate
column), that the actual Stock Price Factor at September 11, 2001 is closest
to, but not greater than, and to no other row.
"Stock Price Factor" is the average of the Sale Prices of the
Company's Common Stock for the 20 consecutive trading days ending on the third
trading day prior to September 11, 2004, expressed as a percentage of $106.33,
subject to adjustment in accordance with Article 10 hereof.
"Subordinated Debt Rate" means the average of the interest rate
quotations for a new issuance of the Company's two-year semi-annual cash-pay
unsecured subordinated debt obtained by the Rate Solicitation Agent for an
issuance in an amount equal to the aggregate Issue Price of the Securities plus
any Accrued Original Issue Discount through September 11, 2004 at approximately
4:00 p.m., New York City time, on the day three Trading Days prior to September
11, 2004 from three independent nationally recognized securities dealers, (each
of which shall be an Affiliate of the Company) selected by the Company;
provided, however, that (a) if the three such quotations cannot be obtained,
then the average of two quotations shall be used in lieu thereof, and (b) if
only one such quotation can be obtained, such quotation shall be used. In the
event that no quotations can be obtained, the Company's Subordinated Debt Rate
will be determined by the good faith determination of the Board of Directors.
70
The table below shows the amount to be deducted from the applicable
Subordinated Debt Rate to determine the aggregate Adjusted Rate of accrual at
which Original Issue Discount and Contingent Additional Principal will accrue
on the XXXXx during the two years commencing September 11:
Stock Price Factor Threshold
If Two Year Unsecured Subordinated Debt Rate at September 11, 2004 is:
----------------------------------------------------------------------------------------
Amount to be Deducted from >4.50% >5.00% >5.50% >6.00% >6.50% >7.00% >7.50% >8.00%
Two Year Unsecured to to to to to to to to
Subordinated Debt Rate to >4.50% 5.00% 5.50% 6.00% 6.50% 7.00% 7.50% 8.00% 8.50% >8.50%
Determine the Adjusted Rate: -
--------------------------- ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
- 6.00%.................. < 74%
-
- 5.50%.................. < 73% < 71%
- -
- 5.00%.................. < 72% < 70% < 69%
- - -
- 4.50%.................. < 69% < 69% < 68% < 66%
- - - -
- 4.00%.................. < 67% < 67% < 67% < 65% < 64%
- - - - -
- 3.50%.................. < 66% < 65% < 64% < 64% < 63% < 62%
- - - - - -
- 3.00%.................. < 64% < 64% < 63% < 61% < 61% < 61% < 59%
- - - - - - -
- 2.50%.................. 62% < 61% < 60% < 60% < 59% < 58% < 58% < 57%
- - - - - - -
- 2.00%.................. < 59% < 58% < 58% < 57% < 56% < 55% < 55% < 54% < 53%
- - - - - - - - -
- 1.50%.................. < 56% < 55% < 54% < 54% < 53% < 53% < 53% < 52% < 51% < 51%
- - - - - - - - - -
- 1.00%.................. < 52% < 51% < 51% < 51% < 50% < 49% < 49% < 48% < 48% < 48%
- - - - - - - - - -
- 0.50%.................. < 47% < 46% < 45% < 45% < 44% < 44% < 44% < 43% < 43% < 43%
- - - - - - - - - -
0.00%.................. < 40% < 40% < 39% < 38% < 38% < 38% < 37% < 37% < 37% < 36%
- - - - - - - - - -
No Contingent Additional Principal will accrue after September 11,
2006, but thereafter Original Issue Discount, including CAP-OID, shall continue
to accrue.
Section 14.02 Payment of Contingent Additional Principal. Contingent
Additional Principal shall be paid on the Stated Maturity of the Securities, or
earlier, as provided herein. Contingent Additional Principal shall accrue on a
Semi-annual bond equivalent basis, using a 360-day year consisting of twelve
30-day months.
Section 14.03 Notice. In the event that any Contingent Additional
Principal accrues on the Securities, the Company shall issue a press release to
that effect which shall include with respect to a Security, the Adjusted Rate,
the amount of Contingent Additional Principal, the revised Redemption Price,
the revised Purchase Price, the revised change in control Purchase Price and
the amount payable at the Stated Maturity. In addition, the Company shall
publish such information on its Web site or through such other public medium as
it may use at that time. The Company shall also notify the Trustee annually in
writing, at such time that the Company files with the Trustee its annual
reports or other information or documents, of any accrual of Contingent
Additional Principal (and CAP-OID thereon). Following its receipt of such
notice, the Trustee shall provide such information to DTC for dissemination to
the participants of DTC.
Section 14.04 Rate Solicitation Agent. The Rate Solicitation Agent
shall solicit quotes from securities dealers, which the Company indicates that
it believes are able to provide quotes for the Company's subordinated debt. The
Company initially appoints the Trustee to act as the Rate Solicitation Agent.
The Company may change the Rate Solicitation Agent at its discretion; provided,
however, that the Rate Solicitation Agent may not be an Affiliate of the
Company.
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ARTICLE 15
MISCELLANEOUS
Section 15.01 Trust Indenture Act Controls. If any provision of this
Indenture limits, qualifies, or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
Section 15.02 Notices. Any request, demand, authorization, notice,
waiver, consent or communication shall be in writing and delivered in person or
delivery by courier guaranteeing overnight delivery or mailed by first-class
mail, postage prepaid, addressed as follows or transmitted by facsimile
transmission (confirmed by guaranteed overnight courier) to the following
facsimile numbers:
if to the Company:
Laboratory Corporation of America Holdings
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Telephone No.: (336) (000-0000)
Facsimile No.: (000) 000-0000
Attention: Xxxxxxxx X. Xxxxx
if to the Trustee:
The Bank of New York
000 Xxxxxxx Xxxxxx,
Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Corporate Trust Administration
with a copy of any notice given pursuant to Article 6 to:
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxxxx, Esq.
The Company or the Trustee by notice given to the other in the manner
provided above may designate additional or different addresses for subsequent
notices or communications.
Any notice or communication given to a Securityholder shall be mailed
to the Securityholder, by first-class mail, postage prepaid, at the
Securityholder's address as it appears on the registration books of the
Registrar and shall be sufficiently given if so mailed within the time
prescribed.
72
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not received by the addressee.
If the Company mails a notice or communication to the Securityholders,
it shall mail a copy to the Trustee and each Registrar, Paying Agent,
Conversion Agent or co-registrar.
Section 15.03 Communication by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar, the Paying Agent, the
Conversion Agent and anyone else shall have the protection of TIA Section
312(c).
Section 15.04 Certificate and Opinion as to Conditions Precedent. Upon
any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
Section 15.05 Statements Required in Certificate or Opinion. Each
Officers' Certificate or Opinion of Counsel with respect to compliance with a
covenant or condition provided for in this Indenture shall include:
(1) a statement that each person making such Officers' Certificate or
Opinion of Counsel has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
Officers' Certificate or Opinion of Counsel are based;
(3) a statement that, in the opinion of each such person, he has made
such examination or investigation as is necessary to enable such person to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement that, in the opinion of such person, such covenant or
condition has been complied with.
Section 15.06 Separability Clause. In case any provision in this
Indenture or in the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 15.07 Rules by Trustee, Paying Agent, Conversion Agent and
Registrar. The Trustee may make reasonable rules for action by or a meeting of
Securityholders. The Registrar,
73
Conversion Agent and the Paying Agent may also make reasonable rules for their
respective functions.
Section 15.08 Calculations. The calculation of the Purchase Price,
Change in Control Purchase Price, Conversion Rate, Market Price, Sale Price of
the Common Stock and each other calculation to be made hereunder (other than
the XXXXx Market Price) shall be the obligation of the Company. All
calculations made by the Company as contemplated pursuant to this Section 15.08
shall be final and binding on the Company and the Holders absent manifest
error. The Trustee, Paying Agent, Conversion Agent, Bid Solicitation Agent and
Rate Solicitation Agent shall not be obligated to recalculate, recompute or
confirm any such calculations.
Section 15.09 Legal Holidays. A "Legal Holiday" is any day other than
a Business Day. If any specified date (including a date for giving notice) is a
Legal Holiday, the action shall be taken on the next succeeding day that is not
a Legal Holiday, and, if the action to be taken on such date is a payment in
respect of the Securities, no Original Issue Discount, Contingent Cash
Interest, or Contingent Additional Principal, if any, shall accrue for the
intervening period.
Section 15.10 GOVERNING LAW. THIS INDENTURE AND THE SECURITIES WILL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
Section 15.11 No Recourse Against Others. A director, officer,
employee, agent, representative, stockholder or equity holder, as such, of the
Company shall not have any liability for any obligations of the Company under
the Securities or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder shall waive and release all such liability. The waiver and
release shall be part of the consideration for the issue of the Securities.
Section 15.12 Successors. All agreements of the Company in this
Indenture and the Securities shall bind its successor. All agreements of the
Trustee in this Indenture shall bind its successor.
Section 15.13 Multiple Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement. One signed copy is enough to prove
this Indenture.
74
IN WITNESS WHEREOF, the undersigned, being duly authorized, have
executed this Indenture on behalf of the respective parties hereto as of the
date first above written.
LABORATORY CORPORATION OF
AMERICA HOLDINGS
By: /s/ Xxxxxxxx X. Xxxxx
---------------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Executive Vice President,
General Counsel, Corporate
Compliance Officer and Secretary
THE BANK OF NEW YORK, as Trustee
By: /s/ Xxxx X. Xxxxxx
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
EXHIBIT A-1
[FORM OF FACE OF GLOBAL SECURITY]
THIS SECURITY WAS ISSUED WITH ORIGINAL ISSUE DISCOUNT FOR U.S. FEDERAL
INCOME TAX PURPOSES. THE HOLDER OF THIS SECURITY MAY CONTACT XXXXXXXX X. XXXXX,
LABORATORY CORPORATION OF AMERICA HOLDINGS, 000 XXXXX XXXX XXXXXX, XXXXXXXXXX,
XX 00000 FOR INFORMATION REGARDING THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE
DISCOUNT, ISSUE DATE, YIELD TO MATURITY, COMPARABLE YIELD AND PROJECTED PAYMENT
SCHEDULE OF THIS SECURITY.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS
GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE REFERRED TO ON THE
REVERSE HEREOF.
THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION
OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY, THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES TO
OFFER, SELL, OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
"RESALE RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF
THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH LABORATORY
CORPORATION OF AMERICA HOLDINGS (THE "COMPANY" OR THE "ISSUER") OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF
A-1-1
THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A) TO THE COMPANY OR
ANY SUBSIDIARY THEREOF, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (C) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT OR (D) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE
OR TRANSFER PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM
APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE
HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
THE FOREGOING LEGEND MAY BE REMOVED FROM THIS SECURITY ON SATISFACTION
OF THE CONDITIONS SPECIFIED IN THE INDENTURE.
A-1-2
LABORATORY CORPORATION OF AMERICA HOLDINGS
Liquid Yield Option(TM) Note due 2021
(Zero Coupon - Subordinated)
No. R- CUSIP: 5055OR AB 8
Issue Date: September 11, 2001 Original Issue Discount
Issue Price: $671.65 (excluding any CAP-OID): $328.35
(for each $1,000 Principal (for each $1,000 Principal
Amount at Maturity) Amount at Maturity)
LABORATORY CORPORATION OF AMERICA HOLDINGS, a Delaware corporation,
promises to pay to Cede & Co. or registered assigns, the Principal Amount at
Maturity of _________________________________________________ DOLLARS
($________________________) on September 11, 2021.
This Security shall not bear interest except as specified on the other
side of this Security. Original Issue Discount will accrue as specified on the
other side of this Security. This Security is convertible as specified on the
other side of this Security.
Additional provisions of this Security are set forth on the other side
of this Security.
Dated: LABORATORY CORPORATION OF
AMERICA HOLDINGS
By:
---------------------------------
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK, as Trustee,
certifies that this is one of
the Securities referred to in the
within-mentioned Indenture.
By:
---------------------------------
Authorized Officer
Dated:
A-1-3
[FORM OF REVERSE SIDE OF LYON]
Liquid Yield Option(TM) Note due 2021
(Zero Coupon - Subordinated)
1. Interest.
This Security shall not bear interest, except as specified in this
paragraph or in paragraph 5. If the Principal Amount at Maturity hereof or any
portion of such Principal Amount at Maturity is not paid when due, or if
Contingent Additional Principal together with CAP-OID thereon, if any, is not
paid when due or any portion of such Contingent Additional Principal, together
with CAP-OID thereon is not paid when due in accordance with paragraph 5.B
hereof, (whether upon acceleration pursuant to Section 6.02 of the Indenture,
upon the date set for payment of the Redemption Price pursuant to paragraph 6
hereof, upon the date set for payment of the Purchase Price or Change in
Control Purchase Price pursuant to paragraph 7 hereof or upon the Stated
Maturity of this Security) or if Contingent Cash Interest, if any, due hereon
or any portion of such interest is not paid when due in accordance with
paragraph 5.A hereof, then in each such case the overdue amount shall, to the
extent permitted by law, bear interest at the rate of 2.0% per annum,
compounded semiannually, which interest shall accrue from the date such overdue
amount was originally due to the date payment of such amount, including
interest thereon, has been made or duly provided for. All such interest shall
be payable on demand. The accrual of such interest on overdue amounts shall be
in lieu of, and not in addition to, the continued accrual of Original Issue
Discount and Contingent Additional Principal.
Original Issue Discount of any Security means the amount that accrues
in respect of such Security daily at a rate of 2.0% per year on the Issue Price
plus any previously accrued amounts beginning on the Issue Date, together with
the amount that accrues on any accrued Contingent Additional Principal daily at
such rate. Original Issue Discount will be calculated on a semi-annual bond
equivalent basis, using a 360-day year comprised of twelve 30-day months
Original Issue Discount will be calculated on a semi-annual bond equivalent
basis, using a 360-day year comprised of twelve 30-day months.
2. Method of Payment.
Subject to the terms and conditions of the Indenture, the Company will
make payments in respect of Redemption Prices, Purchase Prices, Change in
Control Purchase Prices and at Stated Maturity to Holders who surrender
Securities to a Paying Agent to collect such payments in respect of the
Securities. In addition, the Company will pay Contingent Cash Interest and
Contingent Additional Principal (and CAP-OID thereon), if any to the extent not
already included in the calculation of such other amounts. The Company will pay
any cash amounts in Cash. However, the Company may make such cash payments by
check payable in such money.
A-1-4
3. Paying Agent, Conversion Agent, Registrar, Bid Solicitation Agent
and Rate Solicitation Agent.
Initially, The Bank of New York, a New York banking corporation (the
"Trustee"), will act as Paying Agent, Conversion Agent, Registrar, Bid
Solicitation Agent and Rate Solicitation Agent. The Company may appoint and
change any Paying Agent, Conversion Agent, Registrar or co-registrar or Bid
Solicitation Agent or Rate Solicitation Agent without notice, other than notice
to the Trustee except that the Company will maintain at least one Paying Agent
in the State of New York, Borough of Manhattan, which shall initially be an
office or agency of the Trustee. The Company or any of its Subsidiaries or any
of their Affiliates may act as Paying Agent, Conversion Agent, Registrar or
co-registrar. None of the Company, any of its Subsidiaries or any of their
Affiliates shall act as Bid Solicitation Agent or Rate Solicitation Agent.
4. Indenture.
The Company issued the Securities under an Indenture dated as of
September 11, 2001 (the "Indenture"), between the Company and the Trustee. The
terms of the Securities include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939, as in
effect from time to time (the "TIA"). Capitalized terms used herein and not
defined herein have the meanings ascribed thereto in the Indenture. The
Securities are subject to all such terms, and Securityholders are referred to
the Indenture and the TIA for a statement of those terms.
The Securities are general unsecured and subordinated obligations of
the Company limited to $650,000,000 aggregate Principal Amount at Maturity
($744,000,000 aggregate Principal Amount at Maturity, if the over-allotment
option granted to the initial purchaser of the Securities is exercised in full)
(not including Contingent Additional Principal, if any, or CAP-OID thereon and
subject to Section 2.07 of the Indenture). The Indenture does not limit other
indebtedness of the Company, secured or unsecured.
5. Contingent Payments.
A. Contingent Cash Interest. Subject to the conditions of the
Indenture and the record date provisions specified in this paragraph 5.A, the
Company shall pay Contingent Cash Interest to the Holders during any six-month
period (a "Contingent Cash Interest Period") from September 12 to March 11 and
from March 12 to September 11, with the initial six-month period commencing
after September 11, 2006, if the average XXXXx Market Price for the
Five-Trading-Day Measurement Period preceding the first day of the Contingent
Cash Interest Period equals 120% or more of the sum of the Issue Price of a
Security, Original Issue Discount accrued thereon and Contingent Additional
Principal, if any, for such Security as of the day immediately preceding the
first day of the applicable six-month period; provided, however, that if the
Company declares a Common Stock dividend for which the record date for such
dividend (the "Common Stock Record Date") falls prior to the first day of a
Semiannual Period, but the payment date for such dividend falls within such
Semiannual Period, then the "Five-Trading Day Measurement Period" shall mean
the five Trading Days ending on the third Trading Day immediately preceding
such Common Stock Record Date.
A-1-5
Contingent Cash Interest, if any, will accrue and be payable to
holders of this Security as of the record date, which shall be the 15th day
preceding the last day of the applicable six-month period. Original Issue
Discount will continue to accrue whether or not Contingent Cash Interest is
paid.
During any period when Contingent Cash Interest shall be payable, the
amount of Contingent Cash Interest payable per $1,000 Principal Amount at
Maturity hereof in respect of any quarterly period of the applicable Contingent
Cash Interest Period shall equal the greater of (x) 0.0625% of the average
XXXXx Market Price for the relevant Five-Trading-Day Measurement Period and (y)
the sum of all Regular Cash Dividends paid by the Company per share on its
Common Stock during that quarterly period of the applicable Contingent Cash
Interest Period multiplied by the number of shares of Common Stock into which
$1,000 Principal Amount at Maturity hereof is convertible pursuant to paragraph
9 hereof as of the accrual date for such Contingent Cash Interest; provided
that if the Company does not pay cash dividends during a Semiannual Period, the
Company will pay contingent cash interest semi-annually at a rate of 0.125% of
the XXXXx Market Price for the Five-Trading-Day Measurement Period.
Upon determination that Holders will be entitled to receive Contingent
Cash Interest during a Contingent Cash Interest Period the Company shall issue
a press release and publish such information on its Web site or through such
other public medium as the Company may use at that time.
B. Contingent Additional Principal. Subject to the conditions set
forth in the Indenture, on September 11, 2004 the rate of accrual on the XXXXx
will be reset for a period of two years to the Adjusted Rate if the Company's
Stock Price Factor is at or below the Stock Price Factor threshold (as set
forth in Article 14 of the Indenture) on that date. Contingent Additional
Principal shall be the amount that accrues as a result of the Adjusted Rate,
other than Original Issue Discount. If the Stock Price Factor exceeds the
highest Stock Price Factor threshold in the applicable column (as set forth in
Article 14 of the Indenture), no Contingent Additional Principal (and CAP-OID
thereon) shall accrue and Original Issue Discount shall accrue as provided in
the Indenture.
The rate of accrual of Contingent Additional Principal per Security
will be the rate which results from deducting an amount in accordance with the
table set forth in Section 14.01 of the Indenture, from the Company's
Subordinated Debt Rate, provided that in no event will such rate be greater
than 9.0% or less than 2.0%.
Contingent Additional Principal, if any, shall be payable on the
Stated Maturity date of the Securities. Contingent Additional Principal shall
be calculated on a Semi-annual bond equivalent basis, using a 360-day year
consisting of twelve 30-day months. No Contingent Additional Principal will
accrue after September 11, 2006.
In the event that any Contingent Additional Principal accrues on the
Securities, the Company shall issue a press release to that effect which shall
include with respect to a Security the aggregate adjusted rate at which
Original Issue Discount and Contingent Additional Principal will accrue, the
revised Redemption Prices, the revised Purchase Prices, the revised Change in
A-1-6
Control Purchase Price and the amount payable at the Stated Maturity. In
addition, the Company shall publish such information on its Web site or through
such other public medium it may use at that time. The Company shall also notify
the Trustee on a periodic basis in writing of any accrual of Contingent
Additional Principal. Following its receipt of such notice, the Trustee shall
provide such information to DTC for dissemination to the participants of DTC.
6. Redemption at the Option of the Company.
No sinking fund is provided for the Securities. The Securities are
redeemable as a whole, or from time to time in part, at any time at the option
of the Company in accordance with Article 3 of the Indenture at the Redemption
Prices set forth below, provided that the Securities are not redeemable prior
to September 11, 2006.
The table below shows Redemption Prices of a Security per $1,000
Principal Amount at Maturity on the dates shown below and at Stated Maturity,
which prices reflect the Issue Price plus Accrued Original Issue Discount
calculated to each such date and assumes that no Contingent Additional
Principal has accrued. In addition to the Redemption Price payable with respect
to all Securities or portions thereof to be redeemed as of a Redemption Date,
the Holders of such Securities (or portions thereof) shall be entitled to
receive, and the Redemption Price shall include, any Contingent Additional
Principal accrued on the Securities and any CAP-OID thereon and any Accrued
Original Issue Discount in respect thereof, to the Redemption Date.
(1) (2) (3)
LYON Accrued Original Redemption Price
Redemption Date Issue Price Issue Discount (1) + (2)
--------------- ----------- -------------- ----------------
September 11,
2006..................................... $671.65 $ 70.27 $741.92
2007..................................... 671.65 85.18 756.83
2008..................................... 671.65 100.40 772.05
2009..................................... 671.65 115.91 787.56
2010..................................... 671.65 131.74 803.39
2011..................................... 671.65 147.89 819.54
2012..................................... 671.65 164.37 836.02
2013..................................... 671.65 181.17 852.82
2014..................................... 671.65 198.31 869.96
2015..................................... 671.65 215.80 887.45
2016..................................... 671.65 233.64 905.29
2017..................................... 671.65 251.83 923.48
2018..................................... 671.65 270.39 942.04
2019..................................... 671.65 289.33 960.98
2020..................................... 671.65 308.65 980.30
At Stated Maturity....................... $671.65 $328.35 $1000.00
A-1-7
7. Purchase by the Company at the Option of the Holder.
Subject to the terms and conditions of the Indenture, the Company
shall become obligated to purchase, at the option of the Holder, the Securities
held by such Holder on the following Purchase Dates and at the following
Purchase Prices per $1,000 Principal Amount at Maturity, upon delivery of a
Purchase Notice containing the information set forth in the Indenture, at any
time from the opening of business on the date that is 20 Business Days prior to
such Purchase Date until the close of business on the first business day
immediately preceding such Purchase Date and upon delivery of the Securities to
the Paying Agent by the Holder as set forth in the Indenture:
Purchase Date Purchase Price
------------- --------------
September 11, 2004 $712.97
September 11, 2006 $741.92
September 11, 2011 $819.54
The Purchase Price (equal to the Issue Price plus Accrued Original
Issue Discount for the Purchase Date noted in the above table plus Contingent
Additional Principal, if any, and accrued CAP-OID thereon to the Purchase Date)
may be paid, at the option of the Company, in cash or by the issuance and
delivery of shares of Common Stock of the Company, or in any combination
thereof in accordance with the Indenture.
At the option of the Holder and subject to the terms and conditions of
the Indenture, the Company shall become obligated to purchase the Securities
held by such Holder no later than 35 Business Days after the occurrence of a
Change in Control of the Company on or prior to September 11, 2006, but in no
event prior to the date on which such Change in Control occurs, for a Change in
Control Purchase Price equal to the Issue Price, plus Accrued Original Issue
Discount and, if applicable, Contingent Additional Principal (and accrued
CAP-OID thereon) to but not including the Change in Control Purchase Date,
which Change in Control Purchase Price shall be paid in cash.
A third party may make the offer and purchase of the Securities in
lieu of the Company in accordance with the Indenture.
In addition to the Purchase Price or Change in Control Purchase Price,
as the case may be, payable with respect to all Securities or portions thereof
to be purchased as of the Purchase Date or the Change in Control Purchase Date,
as the case may be, the Holders of such Securities (or portions thereof) shall
be entitled to receive accrued and unpaid Contingent Cash Interest, if any,
with respect thereto, which Contingent Cash Interest shall be paid in cash
promptly following the later of the Purchase Date or the Change in Control
Purchase Date, as the case may be, and the time of delivery of such Securities
to the Paying Agent pursuant to the Indenture.
Holders have the right to withdraw any Purchase Notice or Change in
Control Purchase Notice, as the case may be, by delivering to the Paying Agent
a written notice of withdrawal in accordance with the provisions of the
Indenture.
A-1-8
If cash (and/or securities if permitted under the Indenture)
sufficient to pay the Purchase Price or Change in Control Purchase Price, as
the case may be, of, together with any accrued and unpaid Contingent Cash
Interest with respect to, all Securities or portions thereof to be purchased as
of the Purchase Date or the Change in Control Purchase Date, as the case may
be, is deposited with the Paying Agent on the Business Day following the
Purchase Date or the Change in Control Purchase Date, as the case may be,
Original Issue Discount, Contingent Cash Interest, if any, and Contingent
Additional Principal (and CAP-OID thereon), if any, shall cease to accrue on
such Securities (or portions thereof) on such Purchase Date or Change in
Control Purchase Date, as the case may be, and the Holder thereof shall have no
other rights as such (other than the right to receive the Purchase Price or
Change in Control Purchase Price, as the case may be, and accrued and unpaid
Contingent Cash Interest, if any, upon surrender of such Security).
8. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each Holder of Securities to be redeemed
at the Holder's registered address. If money sufficient to pay the Redemption
Price of, and accrued and unpaid Contingent Cash Interest, if any, with respect
to, all Securities (or portions thereof) to be redeemed on the Redemption Date
is deposited with the Paying Agent prior to or on the Redemption Date, on such
Redemption Date, Original Issue Discount, Contingent Cash Interest, if any, and
Contingent Additional Principal (and CAP-OID thereon) shall cease to accrue on
such Securities or portions thereof. Securities in denominations larger than
$1,000 of Principal Amount at Maturity may be redeemed in part but only in
integral multiples of $1,000 of Principal Amount at Maturity.
9. Conversion.
(a) Conversion Based on Common Stock Price. Subject to the
provisions of this paragraph 9, Holders may convert the Securities into Common
Stock on a Conversion Date in any calendar quarter commencing after December
31, 2001, if, as of the last day of the preceding calendar quarter, the Sale
Price of the Common Stock for at least 20 trading days in a period of 30
consecutive trading days ending on the last trading day of such preceding
calendar quarter is greater than the conversion trigger price. The "conversion
trigger price" for any calendar quarter shall be a reference percentage,
beginning at 120%, and declining 0.1282% per calendar quarter thereafter until
it reaches 110.000% for the calendar quarter beginning July 1, 2021, of the
accreted conversion price per share of Common Stock on the last day of such
preceding calendar quarter.
The "accreted conversion price" per share of Common Stock as of any
day equals the quotient of:
o the Issue Price and Accrued Original Issue Discount and any
accrued Contingent Additional Principal (and CAP-OID thereon) to
that day, divided by
o the number of shares of Common Stock issuable upon conversion of
$1,000 Principal Amount at Maturity of Securities on that day.
A-1-9
(b) Conversion Based on Credit Rating. Subject to the provisions
of this paragraph 9, Holders may convert the Securities into Common Stock on a
Conversion Date during any period in which the credit rating assigned to the
Securities by a Rating Agency is at or below the Applicable Rating. "Rating
Agency" means Standard & Poor's Ratings Services, a division of The XxXxxx-Xxxx
Companies Inc., and its successors ("Standard & Poor's") or if Standard &
Poor's is not making ratings of the Securities publicly available, a nationally
recognized U.S. rating agency or agencies, as the case may be, selected by the
Company, which will be substituted for Standard & Poor's, as the case may be.
"Applicable Rating" means, in the case of Standard & Poor's, BB- (or its
equivalent, under any successor ratings categories of Standard & Poor's) or the
equivalent in respect of ratings categories of any Rating Agencies substituted
for Standard & Poor's.
(c) Conversion Based on Redemption. Subject to the provisions of
this paragraph 9, a Holder may convert into Common Stock a Security or portion
of a Security which has been called for redemption pursuant to paragraph 6
hereof, even if the XXXXx are not otherwise convertible at such time, but such
Securities may be surrendered for conversion until the close of business on the
second Business Day immediately preceding the Redemption Date.
(d) Conversion Upon Occurrence of Certain Corporate Transactions.
Subject to the provisions of this paragraph 9, in the event that the Company
declares a dividend or distribution described in Section 10.07 of the
Indenture, or a dividend or a distribution described in Section 10.08 of the
Indenture where the fair market value of such dividend or distribution per
share of Common Stock, as determined in the Indenture, exceeds 15% of the Sale
Price of the Common Stock on the day immediately preceding the date of
declaration for such dividend or distribution, the Securities may be
surrendered for conversion beginning on the date the Company gives notice to
the Holders of such right, which shall not be less than 20 days prior to the
Ex-Dividend Time for such dividend or distribution, and Securities may be
surrendered for conversion at any time thereafter until the close of business
on the Business Day prior to the Ex-Dividend Time or until the Company
announces that such dividend or distribution will not take place.
Subject to the provisions of this paragraph 9, in the event the
Company is a party to a consolidation, merger or binding share exchange or a
transfer of all or substantially all assets of the Company pursuant to which
the Common Stock would be converted into cash, securities or other property as
set forth in Section 10.14 of the Indenture, the Securities may be surrendered
for conversion at any time from and after the date which is 15 days prior to
the anticipated effective date until 15 days after the actual effective date of
such transaction, and at the effective date of such transaction the right to
convert a Security into Common Stock will be deemed to have changed into a
right to convert it into the kind and amount of cash, securities or other
assets of the Company or another person which the holder would have received if
the holder had converted its Security immediately prior to the transaction.
(e) Conversion Formula and Procedures. Subject to the next two
succeeding sentences, a Holder of a Security may convert it into Common Stock
of the Company at any time before the close of business on September 11, 2021.
If the Security is called for redemption, the Holder may convert it only until
the close of business on the second business day immediately preceding the
Redemption Date. A Security in respect of which a Holder has delivered a
Purchase Notice or Change in Control Purchase Notice exercising the option of
such Holder to
A-1-10
require the Company to purchase such Security may be converted only if such
notice of exercise is withdrawn in accordance with the terms of the Indenture.
The initial Conversion Rate is 6.7054 shares of Common Stock per
$1,000 Principal Amount at Maturity, subject to adjustment upon occurrence of
certain events described in the Indenture. The Company will deliver cash in
lieu of any fractional share of Common Stock.
A Security surrendered for conversion by a Holder during the period
from the close of business on any Common Stock Record Date to the opening of
business on the next Contingent Cash Interest Payment Date must be accompanied
by payment of an amount equal to the Contingent Cash Interest, if any, that the
Holder is to receive on the Securities surrendered for conversion, unless the
Company has provided such Holder with a notice of redemption with respect to
such Securities pursuant to Section 3.03 of the Indenture, in which case no
such payment shall be made.
To convert a Security, a Holder must (1) complete and manually sign
the conversion notice below (or complete and manually sign a facsimile of such
notice) and deliver such notice to the Conversion Agent, (2) surrender the
Security to the Conversion Agent, (3) furnish appropriate endorsements and
transfer documents if required by the Conversion Agent, the Company or the
Trustee and (4) pay any transfer or similar tax, if required.
A Holder may convert a portion of a Security if the Principal Amount
at Maturity of such portion is $1,000 or an integral multiple of $1,000. No
payment or adjustment will be made for dividends on the Common Stock except as
provided in the Indenture.
The Conversion Rate will be adjusted for dividends or distributions on
Common Stock payable in Common Stock or other Capital Stock; subdivisions,
combinations or certain reclassifications of Common Stock; distributions to all
holders of Common Stock of certain rights to purchase Common Stock for a period
expiring within 60 days at less than the Sale Price at the Time of
Determination; and distributions to such holders of assets or Debt securities
of the Company or certain rights to purchase securities of the Company
(excluding certain cash dividends or distributions). However, no adjustment
need be made if Securityholders may participate in the transaction or in
certain other cases. The Company from time to time may voluntarily increase the
Conversion Rate.
In the event that the Company declares a dividend or distribution
described in Section 10.07 of the Indenture, or a dividend or a distribution
described in Section 10.08 of the Indenture where the fair market value of such
dividend or distribution per share of Common Stock, as determined in the
Indenture, exceeds 15% of the Sale Price of the Common Stock on the day
preceding the date of declaration for such dividend or distribution, the
Company shall give notice to the Holders, which shall not be less than 20 days
prior to the Ex-Dividend Date for such dividend or distribution.
If the Company is a party to a consolidation, merger or binding share
exchange or a transfer of all or substantially all of its assets, or upon
certain distributions described in the Indenture, the right to convert a
Security into Common Stock may be changed into a right to convert it into the
kind and amount of securities, cash or other assets of the Company or another
A-1-11
person which the Holder would have received if the Holder had converted its
Securities immediately prior to the transaction.
The Conversion Rate will not be adjusted for any accrued Contingent
Cash Interest, if any, or Contingent Additional Principal (and CAP-OID
thereon), if any.
10. Conversion Arrangement on Call for Redemption.
Any Securities called for redemption, unless surrendered for
conversion before the close of business on the Redemption Date, may be deemed
to be purchased from the Holders of such Securities at an amount not less than
the Redemption Price, by one or more investment banks or other purchasers who
may agree with the Company to purchase such Securities from the Holders, to
convert them into Common Stock and to make payment for such Securities to the
Trustee in trust for such Holders.
11. Subordination.
The Securities are subordinated to the Senior Indebtedness of the
Company. To the extent provided in the Indenture, Senior Indebtedness of the
Company must be paid before the Securities may be paid. The Company and each
Holder of Securities, by accepting a Security, agrees to the subordination
provisions contained in the Indenture and authorizes the Trustee to give it
effect and appoints the Trustee as attorney-in-fact for such purpose.
12. Defaulted Interest.
Except as otherwise specified with respect to the Securities, any
Defaulted Interest on any Security shall forthwith cease to be payable to the
registered Holder thereof on the relevant record date therefor by virtue of
having been such Holder, and such Defaulted Interest may be paid by the Company
as provided for in Section 10.01 of the Indenture.
13. Denominations; Transfer; Exchange.
The Securities are in fully registered form, without coupons, in
denominations of $1,000 of Principal Amount at Maturity and integral multiples
of $1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not transfer
or exchange any Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security not to be
redeemed) or any Securities in respect of which a Purchase Notice or Change in
Control Purchase Notice has been given and not withdrawn (except, in the case
of a Security to be purchased in part, the portion of the Security not to be
purchased) or any Securities for a period of 15 days before the mailing of a
notice of redemption of Securities to be redeemed.
14. Persons Deemed Owners.
The registered Holder of this Security may be treated as the owner of
this Security for all purposes.
A-1-12
15. Unclaimed Money or Securities.
The Trustee and the Paying Agent shall return to the Company upon
written request any money or securities held by them for the payment of any
amount with respect to the Securities that remains unclaimed for two years,
subject to applicable unclaimed property laws. After return to the Company,
Holders entitled to the money or securities must look to the Company for
payment as general creditors unless an applicable abandoned property law
designates another person.
16. Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding and (ii) certain Defaults may be waived with
the written consent of the Holders of a majority in aggregate Principal Amount
at Maturity of the Securities at the time outstanding. Subject to certain
exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company and the Trustee may amend the Indenture or the
Securities to cure any ambiguity, omission, defect or inconsistency, to comply
with Article 5 or Section 10.14 of the Indenture, to secure the Company's
obligations under this Security, to add to the Company's covenants for the
benefit of the Securityholders or to surrender any right or power conferred, to
comply with any requirement of the SEC in connection with the qualification of
the Indenture under the TIA, or as necessary in connection with the
registration of the Securities under the Securities Act or to make any change
that does not adversely affect the rights of any Holders.
17. Defaults and Remedies.
Securityholders may not enforce the Indenture or the Securities except
as provided in the Indenture. The Trustee may refuse to enforce the Indenture
or the Securities unless it receives indemnity or security reasonably
satisfactory to it. Subject to certain limitations, Holders of a majority in
aggregate Principal Amount at Maturity of the Securities at the time
outstanding may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default
(except a Default in payment of amounts specified in Sections 6.01(1) and (2)
of the Indenture if it determines that withholding notice is in their
interests.
18. Trustee Dealings with the Company.
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
19. No Recourse Against Others.
A director, officer, employee, agent, representative, stockholder or
equity holder, as such, of the Company shall not have any liability for any
obligations of the Company under the
A-1-13
Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Securities.
20. Authentication.
This Security shall not be valid until an authorized signatory of the
Trustee manually signs the Trustee's Certificate of Authentication on the other
side of this Security.
21. Abbreviations.
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
22. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES WILL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
----------------------
A-1-14
The Company will furnish to any Securityholder upon written request
and without charge a copy of the Indenture which has in it the text of this
Security in larger type. Requests may be made to:
LABORATORY CORPORATION OF AMERICA HOLDINGS
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
________________________________________________________
________________________________________________________
(Insert assignee's soc. sec. or tax ID no.)
________________________________________________________
________________________________________________________
________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint
_____________________ agent to transfer this Security on the books of the
Company. The agent may substitute another to act for him.
CONVERSION NOTICE
To convert this Security into Common Stock of the Company, check the box:
[ ]
To convert only part of this Security, state the Principal Amount at Maturity
to be converted (which must be $1,000 or an integral multiple of $1,000):
$___________________
If you want the stock certificate made out in another person's name, fill in
the form below:
________________________________________________________
________________________________________________________
(Insert other person's soc. sec. or tax ID no.)
________________________________________________________
________________________________________________________
________________________________________________________
________________________________________________________
(Print or type other person's name, address and zip code)
_______________________________________________________________________________
Date: _____________________ Your Signature:__________________________________
_______________________________________________________________________________
(Sign exactly as your name appears on the other side of this Security)
A-1-15
EXHIBIT B-1
Transfer Certificate
In connection with any transfer of any of the Securities within the
period prior to the expiration of the holding period applicable to the sales
thereof under Rule 144(k) under the Securities Act of 1933, as amended (the
"Securities Act") (or any successor provision), the undersigned registered
owner of this Security hereby certifies with respect to $____________ Principal
Amount at Maturity of the above-captioned securities presented or surrendered
on the date hereof (the "Surrendered Securities") for registration of transfer,
or for exchange or conversion where the securities issuable upon such exchange
or conversion are to be registered in a name other than that of the undersigned
registered owner (each such transaction being a "transfer"), that such transfer
complies with the restrictive legend set forth on the face of the Surrendered
Securities for the reason checked below:
[ ] A transfer of the Surrendered Securities is made to the
Company or any of its subsidiaries; or
[ ] The transfer of the Surrendered Securities complies with
Rule 144A under the Securities Act; or
[ ] The transfer of the Surrendered Securities is pursuant to an
effective registration statement under the Securities Act; or
[ ] The transfer of the Surrendered Securities is pursuant to
another available exemption from the registration requirement
of the Securities Act.
and unless the box below is checked, the undersigned confirms that, to
the undersigned's knowledge, such Securities are not being transferred to an
"affiliate" of the Company as defined in Rule 144 under the Securities Act (an
"Affiliate").
[ ] The transferee is an Affiliate of the Company.
DATE:________________________ _______________________________________
Signature(s)
(If the registered owner is a corporation, partnership or
fiduciary, the title of the Person signing on behalf of
such registered owner must be stated.)
B-1-1
ANNEX C
Projected Payment Schedule*
Semi-annual Period Ending Projected Payment per LYON
------------------------- --------------------------
March 11, 2002 --
September 11, 2002
March 11, 2003 --
September 11, 2003
March 11, 2004 --
September 11, 2004
March 11, 2005 --
September 11, 2005
March 11, 2006 --
September 11, 2006
March 11, 2007 --
September 11, 2007
March 11, 2008
September 11, 2008 $1.24
March 11, 2009 1.31
September 11, 2009 1.37
March 11, 2010 1.44
September 11, 2010 1.51
March 11, 2011 1.59
September 11, 2011 1.67
March 11, 2012 1.75
September 11, 2012 1.84
March 11, 2013 1.94
September 11, 2013 2.03
March 11, 2014 2.13
September 11, 2014 2.24
March 11, 2015 2.35
September 11, 2015 2.47
March 11, 2016 2.60
September 11, 2016 2.73
March 11, 2017 2.86
September 11, 2017 3.01
March 11, 2018 3.16
September 11, 2018 3.32
---------
* The comparable yield and the schedule of projected payments are determined
on the basis of an assumption of linear growth of the stock price and a
constant dividend yield and are not determined for any purpose other than
for the determination of interest accruals and adjustments thereof in
respect of the Securities for United States federal income tax purposes.
The comparable yield and the schedule of projected payments do not
constitute a projected or representation regarding the amounts payable on
Securities.
C-1
Semi-annual Period Ending Projected Payment per LYON
------------------------- --------------------------
March 11, 2019 3.49
September 11, 2019 3.66
March 11, 2020 3.84
September 11, 2020 4.04
March 11, 2021 4.24
September 11, 2021 $3,567.85
C-2
