Exhibit 4.1
STILLWATER MINING COMPANY
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7% Convertible Subordinated Notes Due 2003
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INDENTURE
Dated as of April 29, 1996
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COLORADO NATIONAL BANK,
as Trustee
TABLE OF CONTENTS
Page
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ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.01. Definitions....................................................-2-
SECTION 1.02. Other Definitions..............................................-7-
SECTION 1.03. Incorporation by Reference of Trust Indenture Act..............-8-
SECTION 1.04. Rules of Construction..........................................-8-
ARTICLE II
The Convertible Notes
SECTION 2.01. Form and Dating............................................... -9-
SECTION 2.02. Execution and Authentication..................................-11-
SECTION 2.03. Registrar, Paying Agent and Conversion Agent..................-12-
SECTION 2.04. Paying Agent to Hold Money in Trust...........................-12-
SECTION 2.05. Noteholder Lists..............................................-12-
SECTION 2.07. Replacement Convertible Notes.................................-20-
SECTION 2.08. Outstanding Convertible Notes.................................-20-
SECTION 2.09. Treasury Convertible Notes....................................-21-
SECTION 2.10. Temporary Convertible Notes; Exchange of Global Note for
Certificated Convertible Note.................................-21-
SECTION 2.11. Cancellation..................................................-22-
SECTION 2.12. Defaulted Interest............................................-22-
ARTICLE III
Redemption
SECTION 3.01. Notices to Trustee............................................-22-
SECTION 3.02. Selection of Convertible Notes to be Redeemed.................-22-
SECTION 3.03. Notice of Redemption..........................................-23-
SECTION 3.04. Effect of Notice of Redemption................................-24-
SECTION 3.05. Deposit of Redemption Price...................................-24-
SECTION 3.06. Convertible Notes Redeemed in Part............................-24-
SECTION 3.07. Optional Redemption...........................................-24-
SECTION 3.08. Designated Event Offer........................................-25-
ARTICLE IV
Covenants
SECTION 4.01. Payment of Convertible Notes..................................-27-
SECTION 4.02. SEC Reports...................................................-27-
SECTION 4.03. Compliance Certificate........................................-27-
SECTION 4.04. Stay, Extension and Usury.....................................-28-
SECTION 4.05. Corporate Existence...........................................-28-
SECTION 4.06. Taxes.........................................................-28-
SECTION 4.07. Designated Event..............................................-29-
SECTION 4.08. Stockholders Rights Plan......................................-29-
-i-
ARTICLE V
Conversion
SECTION 5.01. Conversion Privilege..........................................-29-
SECTION 5.02. Conversion Procedure..........................................-30-
SECTION 5.03. Fractional Shares.............................................-30-
SECTION 5.04. Taxes on Conversion...........................................-30-
SECTION 5.05. Company to Provide Stock......................................-31-
SECTION 5.06. Adjustment of Conversion Price................................-31-
SECTION 5.07. No Adjustment.................................................-34-
SECTION 5.08. Other Adjustments.............................................-34-
SECTION 5.09. Adjustments for Tax Purposes..................................-34-
SECTION 5.10. Adjustments by the Company....................................-35-
SECTION 5.11. Notice of Adjustment..........................................-35-
SECTION 5.12. Notice of Certain Transactions................................-35-
SECTION 5.13. Effect of Reclassifications, Consolidations,
Mergers or Sales on Conversion Privilege..........................-35-
SECTION 5.14. Trustee's Disclaimer..........................................-36-
ARTICLE VI
Subordination
SECTION 6.01. Agreement to Subordinate......................................-37-
SECTION 6.02. No Payment on Convertible Notes if Senior Debt in Default.....-37-
SECTION 6.03. Distribution on Acceleration of Convertible Notes; Dissolution
and Reorganization; Subrogation of Convertible Notes..............-38-
SECTION 6.04. Reliance by Senior Debt on Subordination Provisions...........-40-
SECTION 6.05. No Waiver of Subordination Provisions.........................-41-
SECTION 6.06. Trustee's Relation to Senior Debt.............................-41-
SECTION 6.07. Other Provisions Subject Hereto...............................-42-
ARTICLE VII
Successors
SECTION 7.01. Merger, Consolidation or Sale of Assets.......................-42-
SECTION 7.02. Successor Corporation Substituted.............................-43-
ARTICLE VIII
Defaults and Remedies
SECTION 8.01. Events of Default.............................................-43-
SECTION 8.02. Acceleration..................................................-44-
SECTION 8.03. Other Remedies................................................-44-
SECTION 8.04. Waiver of Past Defaults.......................................-45-
SECTION 8.05. Control by Majority...........................................-45-
SECTION 8.06. Limitation on Suits...........................................-45-
SECTION 8.07. Rights of Noteholders to Receive Payment......................-45-
SECTION 8.08. Collection Suit by Trustee....................................-46-
SECTION 8.09. Trustee May File Proofs of Claim..............................-46-
SECTION 8.10. Priorities....................................................-46-
-ii-
SECTION 8.11. Undertaking for Costs.........................................-46-
ARTICLE IX
Trustee
SECTION 9.01. Duties of Trustee.............................................-47-
SECTION 9.03. Individual Rights of Trustee..................................-48-
SECTION 9.04. Trustee's Disclaimer..........................................-48-
SECTION 9.05. Notice of Defaults............................................-48-
SECTION 9.06. Reports by Trustee to Noteholders.............................-48-
SECTION 9.07. Compensation and Indemnity....................................-48-
SECTION 9.08. Replacement of Trustee........................................-49-
SECTION 9.09. Successor Trustee by Merger, Etc..............................-50-
SECTION 9.10. Eligibility; Disqualification.................................-50-
SECTION 9.11. Preferential Collection of Claims Against Company.............-50-
SECTION 9.12. Sections Applicable to Registrar, Paying Agent and Conversion
Agent.............................................................-50-
ARTICLE X
Discharge of Indenture
SECTION 10.01. Termination of Company's Obligations.........................-50-
SECTION 10.02. Repayment to Company.........................................-51-
ARTICLE XI
Amendments, Supplements and Waivers
SECTION 11.01. Without Consent of Noteholders...............................-51-
SECTION 11.02. With Consent of Noteholders..................................-52-
SECTION 11.03. Compliance with Trust Indenture Act..........................-53-
SECTION 11.04. Revocation and Effect of Consents............................-53-
SECTION 11.05. Notation on or Exchange of Convertible Notes.................-53-
SECTION 11.06. Trustee Protected............................................-54-
ARTICLE XII
Miscellaneous
SECTION 12.01. Trust Indenture Act Controls.................................-54-
SECTION 12.02. Notices......................................................-54-
SECTION 12.03. Communication by Noteholders with Other Noteholders..........-54-
SECTION 12.04. Certificate and Opinion as to Conditions Precedent...........-54-
SECTION 12.05. Statements Required in Certificate or Opinion................-55-
SECTION 12.06. Rules by Trustee and Agents..................................-55-
SECTION 12.07. Legal Holidays...............................................-55-
SECTION 12.08. No Recourse Against Others...................................-55-
SECTION 12.09. Counterparts.................................................-55-
SECTION 12.10. Variable Provisions..........................................-55-
SECTION 12.11. GOVERNING LAW................................................-56-
SECTION 12.12. No Adverse Interpretation of Other Agreements................-56-
SECTION 12.13. Successors...................................................-56-
SECTION 12.14. Severability.................................................-56-
-iii-
SECTION 12.15. Table of Contents, Headings, Etc.............................-56-
EXHIBIT A FORM OF CONVERTIBLE SUBORDINATED NOTES
EXHIBIT B FORMS OF TRANSFER CERTIFICATES
-iv-
CROSS-REFERENCE TABLE*
TRUST INDENTURE INDENTURE
ACT SECTION SECTION
310(a)(1) .............................................. 9.10
(a)(2) .............................................. 12.10
(a)(3) .............................................. N.A
(a)(4) .............................................. N.A
(b) .............................................. 9.08; 9.10
(c) .............................................. N.A.
311(a) .............................................. 9.11
(b) .............................................. 9.11
(c) .............................................. N.A.
312(a) .............................................. 2.05
(b) .............................................. 12.03
(c) .............................................. 12.03
313(a) .............................................. 9.06
(b)(1) .............................................. N.A.
(b)(2) .............................................. 9.06
(c) .............................................. 9.06
(d) .............................................. 9.06
314(a) .............................................. 4.02, 4.03
(b) .............................................. N.A.
(c)(1) .............................................. 12.04
(c)(2) .............................................. 12.04
(c)(3) .............................................. N.A.
(d) .............................................. N.A.
(e) .............................................. 12.05
(f) .............................................. N.A.
315(a) .............................................. 9.01(b)
(b) .............................................. 9.05
(c) .............................................. 9.01(a)
(d) .............................................. 9.01(c)
(e) .............................................. 8.11
316 (a) (last sentence).................................. 2.09
(a) (1) (A).............................................. 8.05
(a) (1) (B).............................................. 8.04
(a) (2) .............................................. N.A.
(b) .............................................. 8.07
(c) .............................................. 11.04
317(a) (1) .............................................. 8.08
(a) (2) .............................................. 8.09
(b) .............................................. 2.04
318(a) .............................................. N.A.
N.A. means not applicable.
_____________________
* This Cross-Reference Table is not part of the Indenture.
-v-
INDENTURE dated as of April 29, 1996 between Stillwater Mining Company, a
Delaware corporation (the "Company") and Colorado National Bank, a national
banking association, as trustee (the "Trustee").
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the Noteholders of the Company's 7% Convertible
Subordinated Notes Due 2003 (the "Convertible Notes"):
ARTICLE I
Definitions and Incorporation by Reference
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SECTION 1.01. Definitions. "Affiliate" of any specified person means
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any other person directly or indirectly controlling or controlled by or under
direct or indirect common control with such specified person. For the purposes
of this definition, "control" (including, with correlative meanings, the terms
"controlling", "controlled by" and "under common control with"), as used with
respect to any person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such
person, whether through the ownership of voting securities or by agreement or
otherwise; provided, however, that beneficial ownership of 10% or more of the
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voting securities of a person shall be deemed to be control.
"Agent" means any Registrar, Paying Agent, Conversion Agent or co-
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registrar.
"Board of Directors" means the Board of Directors of the Company or
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any authorized committee of the Board.
"Board Resolution" means a duly authorized resolution of the Board of
----------------
Directors.
"Business Day" means any day that is not a Legal Holiday.
------------
"Capital Stock" means any and all shares, interests, participations,
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rights or other equivalents (however designated) of equity interests in any
entity, including, without limitation, corporate stock and partnership
interests.
"Change of Control" means any event where: (i) any "person" or "group"
-----------------
(as such terms are used in Section 13(d) and 14(d) of the Exchange Act) is or
becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act) of shares representing more than 50% of the combined voting power
of the then outstanding securities entitled to vote generally in elections of
directors of the Company ("Voting Stock"), (ii) the Company consolidates with or
merges into any other corporation, or conveys, transfers or leases all or
substantially all of its assets (other than to a wholly-owned Subsidiary of the
Company) or any other corporation merges into the Company, and, in the case of
any such transaction, the outstanding Common Stock of the Company is
reclassified into or exchanged for any other property or security, unless the
stockholders of the Company immediately before such transaction own, directly or
indirectly immediately following such transaction, at least a majority of the
combined voting power of the outstanding voting securities of the corporation
resulting from, or to which its assets were conveyed, transferred or leased in
connection with, such transaction in substantially the same proportion as their
ownership of the Voting Stock immediately before such transaction or (iii) any
time the Continuing Directors do not constitute a majority of the Board of
Directors of the Company (or, if applicable, a successor
-2-
corporation to the Company); provided, that a Change of Control shall not be
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deemed to have occurred if either (x) the last sale price of the Common Stock
for any five trading days during the ten trading days immediately preceding the
Change of Control is at least equal to 105% of the Conversion Price in effect on
the date of such Change of Control or (y) at least 90% of the consideration
(excluding cash payments for fractional shares) in the transaction or
transactions constituting the Change of Control consists of shares of common
stock that are, or upon issuance will be, traded on a United States national
securities exchange or approved for trading on an established automated
over-the-counter trading market in the United States.
"Common Stock" means the common stock of the Company as the same
------------
exists at the date of the execution of this Indenture or as such stock may be
constituted from time to time.
"Company" means the party named as such above until a successor
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replaces it in accordance with Article VII and thereafter means the successor.
"Continuing Directors" means, as of any date of determination, any
--------------------
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of this Indenture or (ii) was nominated for
election or elected to such Board of Directors with the approval of a majority
of the Continuing Directors who were members of such Board at the time of such
nomination or election.
"Convertible Notes" means the Convertible Notes described above
-----------------
issued, authenticated and delivered under this Indenture.
"Daily Market Price" means the price of a share of Common Stock on the
------------------
relevant date, determined (a) on the basis of the last reported sale price of
the Common Stock as reported on the Nasdaq National Market, or if the Common
Stock is not then listed on the Nasdaq National Market, as reported on such
national securities exchange upon which the Common Stock is listed, or (b) if
there is no such last reported sale on the day in question, on the basis of the
average of the closing bid and asked quotations as so reported, or (c) if the
Common Stock is not listed on the Nasdaq National Market or on any national
securities exchange, on the basis of the average of the high bid and low asked
quotations on the day in question in the over-the-counter market as reported by
the National Association of Securities Dealers Automated Quotation System, or if
not so quoted, as reported by National Quotation Bureau, Incorporated, or a
similar organization.
"Default" means any event that is or, with the passage of time or the
-------
giving of notice or both would be, an Event of Default.
"Depositary" means The Depository Trust Company, its nominees and
----------
their respective successors.
"Designated Event" means the occurrence of a Change of Control or a
----------------
Termination of Trading.
"Designated Senior Debt" means any Senior Debt which, at the date of
----------------------
determination, has an aggregate principal amount outstanding of, or commitments
to lend (without regard to borrowing base limitations), at least $10,000,000 and
is specifically designated in the instrument, as amended from time to time,
evidencing or governing such Senior Debt as "Designated Senior
-3-
Debt" for purposes of this Indenture (provided, that such instrument may place
--------
limitations and conditions on the right of such Senior Debt to exercise the
rights of Designated Senior Debt).
"Excess Payment" means the excess of (a) the aggregate of the cash and
--------------
fair market value of other consideration paid by the Company or any of its
Subsidiaries with respect to the shares acquired in a tender offer or other
negotiated transaction over (b) the Daily Market Price of such acquired shares
on the Trading Day immediately after giving effect to the completion of such
tender offer or other negotiated transaction.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
------------
"GAAP" means generally accepted accounting principles set forth in the
----
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as approved by a significant segment of the accounting profession,
which are in effect from time to time.
"Global Notes" means, individually and collectively, the Regulation S
------------
Temporary Global Note, the Regulation S Permanent Global Note and the Rule 144A
Global Note.
"Guarantee" means a guarantee (other than by endorsement of negotiable
---------
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness.
"Indebtedness" means, with respect to any person, all Obligations,
------------
whether or not contingent, of such person (i) (a) for borrowed money (including,
but not limited to, any indebtedness secured by a security interest, mortgage or
other lien on the assets of such person which is (1) given to secure all or part
of the purchase price of property subject thereto, whether given to the vendor
of such property or to another, or (2) existing on property at the time of
acquisition thereof), (b) evidenced by a note, debenture, bond or other written
instrument, (c) under a lease required to be capitalized on the balance sheet of
the lessee under GAAP or under any lease or related document (including a
purchase agreement) which provides that such person is contractually obligated
to purchase or to cause a third party to purchase such leased property, (d) in
respect of letters of credit, bank guarantees or bankers' acceptances, (e) with
respect to indebtedness secured by a mortgage, pledge, lien, encumbrance, charge
or adverse claim affecting title or resulting in an encumbrance to which the
property or assets of such person are subject, whether or not the obligation
secured thereby shall have been assumed or Guaranteed by or shall otherwise be
such person's legal liability, (f) in respect of the balance of deferred and
unpaid purchase price of any property or assets, or (g) under interest rate or
currency swap agreements, cap, floor and collar agreements, spot and forward
contracts and similar agreements and arrangements, on a net basis; (ii) with
respect to any obligation of others of the type described in the preceding
clause (i) or under clause (iii) below, assumed by or Guaranteed in any manner
by such person or in effect Guaranteed by such person through an agreement to
purchase (including, without limitation, "take or pay" and similar
arrangements), contingent or otherwise; and (iii) any and all deferrals,
renewals, extensions, refinancings and refundings of, or amendments,
modifications or supplements to, any of the foregoing.
"Indenture" means this Indenture, as amended from time to time.
---------
-4-
"Initial Purchaser" means Salomon Brothers Inc.
-----------------
"Issuance Date" means the date on which the Convertible Notes are
-------------
first authenticated and issued.
"Material Subsidiary" means any Subsidiary of the Company which is a
-------------------
"significant subsidiary" as defined in Rule 1-02(w) of Regulation S-X under the
Securities Act and the Exchange Act (as such Regulation is in effect on the date
hereof).
"Noteholder" or "holder" means a person in whose name a Convertible
---------- ------
Note is registered.
"Obligations" means any principal, interest, penalties, fees,
-----------
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"Offering Memorandum" means the offering memorandum relating to the
-------------------
Convertible Notes dated April 24, 1996.
"Officers' Certificate" means a certificate signed by two Officers,
---------------------
one of whom must be the Chairman, the President, the Chief Financial Officer,
the Treasurer or a Vice-President of the Company. See Sections 12.04 and 12.05
hereof.
"Opinion of Counsel" means a written opinion from legal counsel who is
------------------
acceptable to the Trustee. The counsel may be an employee of or counsel to the
Company or the Trustee. See Sections 12.04 and 12.05 hereof.
"person" means any individual, corporation, partnership, limited
------
liability company, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"principal" of a debt security means the principal of the security
---------
plus the premium, if any, on the security.
"Registration Agreement" means the Registration Agreement relating to
----------------------
the Convertible Notes dated April 29, 1996 between the Company and the Initial
Purchaser.
"Regulation S" means Regulation S, as amended, promulgated under the
------------
Securities Act.
"Regulation S Global Note" means the Regulation S Temporary Global
------------------------
Note or the Regulation S Permanent Global Note, as appropriate.
"Regulation S Permanent Global Note" means a permanent global note
----------------------------------
that contains the paragraph referred to in footnote 1 and the additional
schedule referred to in the form of the Convertible Note attached hereto as
Exhibit A-1, and that is deposited with and registered in the name of the
Depositary, representing the Convertible Notes sold in reliance on Regulation S.
"Regulation S Temporary Global Note" means a single temporary global
----------------------------------
note in the form of the Convertible Note attached hereto as Exhibit A-2 that is
deposited with and registered in the name of the Depositary, representing the
Convertible Notes sold in reliance on Regulation S.
-5-
"Representative" means the trustee, agent or representative (if any)
--------------
for an issue of Senior Debt.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
---------
"Rule 144A Global Note" means a permanent global note that contains
---------------------
the paragraph referred to in footnote 1 and the additional schedule referred to
in the form of the Convertible Note attached hereto as Exhibit A-1, and that is
deposited with and registered in the name of the Depositary, representing the
Convertible Notes sold in reliance on Rule 144A.
"SEC" means the Securities and Exchange Commission.
---
"Securities Act" means the Securities Act of 1933, as amended.
--------------
"Senior Debt" means the Obligations due on Indebtedness of the
-----------
Company, whether outstanding on the date of the Indenture or thereafter created,
incurred, assumed or Guaranteed by the Company; unless, in the instrument (as
amended from time to time) creating or evidencing Indebtedness or pursuant to
which Indebtedness is outstanding, it is expressly provided that such
Indebtedness is not senior in right of payment to the Convertible Notes. Senior
Debt includes, with respect to the Obligations described above, interest
accruing, pursuant to the terms of such Senior Debt, on or after the filing of
any petition in bankruptcy or for reorganization relating to the Company,
whether or not post-filing interest is allowed in such proceeding, at the rate
specified in the instrument governing the relevant obligation. Notwithstanding
anything to the contrary in the foregoing, Senior Debt shall not include: (a)
Indebtedness of or amounts owed by the Company for compensation to employees, or
for goods, services or materials purchased in the ordinary course of business;
(b) Indebtedness of the Company to a Subsidiary of the Company or any officer,
director or employee of the Company or any Subsidiary thereof; or (c) any
liability for Federal, state, local or other taxes, owed or owing by the
Company.
"Shelf Registration Statement" shall have the meaning set forth in the
----------------------------
Registration Agreement.
"Stockholder Rights Plan" shall mean that certain Rights Agreement
-----------------------
adopted by the Board of Directors of the Company in October 1995.
"Subsidiary" means any corporation, association or other business
----------
entity of which more than 50% of the total voting power of shares of Capital
Stock then outstanding entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by any person or one
or more of the other Subsidiaries of that person or a combination thereof.
"Termination of Trading" means an event where the Common Stock (or
----------------------
other common stock into which the Convertible Notes are then convertible) is
neither listed for trading on a United States national securities exchange nor
approved for trading on an established automated over-the-counter trading market
in the United States; provided, that a Termination of Trading shall not be
deemed to have occurred if the Common Stock (or other common stock into which
the Convertible Notes are then convertible) is neither listed or approved for
trading as a result of a transaction that does not constitute a Change of
Control as described under clause (ii) of the definition of "Change of Control."
-6-
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code (S)(S)77aaa-
---
77bbbb) as in effect on the date of execution of this Indenture.
"Trading Day" shall mean (A) if the applicable security is listed or
-----------
admitted for trading on the New York Stock Exchange or another national
securities exchange, a day on which the New York Stock Exchange or another
national securities exchange is open for business, (B) if the applicable
security is quoted on the Nasdaq National Market, a day on which trades may be
made thereon or (c) if the applicable security is not so listed, admitted for
trading or quoted, any day other than a Saturday or Sunday or a day on which
banking institutions in the State of New York are authorized or obligated by law
or executive order to close.
"Trustee" means the party named as such above until a successor
-------
replaces it in accordance with the applicable provisions of this Indenture and
thereafter means the successor.
"Trust Officer" when used with respect to the Trustee, means the
-------------
chairman or any vice chairman of the board of directors, the chairman or any
vice chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any senior vice president, any vice
president, any assistant vice president, the secretary the treasurer, any
assistant treasurer, the cashier, any assistant cashier, any senior trust
officer, any trust officer, the controller, any assistant controller, or any
other officer of the Trustee customarily performing functions similar to those
performed by the persons who at the time are such officers, respectively, and
also means, with respect to a particular corporate trust matter, any officer to
whom such corporate trust matter is referred because of his knowledge of and
familiarity with the particular subject.
"U.S. Person" has the meaning specified in Regulation S.
-----------
SECTION 1.02. Other Definitions.
-----------------
Defined in
Term Section
---- ----------
"Agent Members"...........................................................2.01
"Bankruptcy Law"..........................................................8.01
"Cedel"...................................................................2.01
"Commencement Date".......................................................3.08
"Conversion Agent"........................................................2.03
"Conversion Date".........................................................5.02
"Conversion Price"........................................................5.01
"Conversion Shares".......................................................5.06
"Custodian"...............................................................8.01
"Designated Event Offer"..................................................4.07
"Designated Event Payment"................................................4.07
"Designated Event Payment Date"...........................................3.08
"Distribution Date".......................................................5.06
"Distribution Record Date"................................................5.06
"Euroclear"...............................................................2.01
"Event of Default"........................................................8.01
"Institutional Accredited Investors"......................................2.01
-7-
"Legal Holiday"...........................................................12.07
"Offer Amount"............................................................ 3.08
"Officer".................................................................12.10
"Paying Agent"............................................................ 2.03
"Payment Blockage Notice"................................................. 6.02
"Payment Blockage Period"................................................. 6.02
"Payment Default"......................................................... 8.01
"Purchase Agreement"...................................................... 2.01
"Purchase Date"........................................................... 5.06
"QIBs".................................................................... 2.01
"Registrar"............................................................... 2.03
"Restricted Convertible Notes"........................................... 2.01
"Rights".................................................................. 5.06
"Tender Period"........................................................... 3.08
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:
"indenture securities" means the Convertible Notes;
--------------------
"indenture security holder" means a Noteholder;
-------------------------
"indenture qualified" means this Indenture;
-------------------
"indenture trustee" or "institutional trustee" means the Trustee; and
----------------- ---------------------
"obligor" on the Convertible Notes means the Company or any other
-------
obligor on the Convertible Notes.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
SECTION 1.04. Rules of Construction. Unless the context otherwise
---------------------
requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP consistently applied;
(c) references to "GAAP" shall mean GAAP in effect as of the time when
and for the period as to which such accounting principles are to be
applied;
(d) "or" is not exclusive;
-8-
(e) words in the singular include the plural, and words in the plural
include the singular; and
(f) provisions apply to successive events and transactions.
ARTICLE II
The Convertible Notes
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SECTION 2.01. Form and Dating. The Convertible Notes and the
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Trustee's certificate of authentication shall be substantially in the form of
Exhibit A-1 attached hereto. The Convertible Notes may have notations, legends
or endorsements required by law, stock exchange rule or usage. Each Convertible
Note shall be dated the date of its authentication. The Convertible Notes shall
be issued in minimum denominations of $1,000 and integral multiples of $1,000 in
excess thereof. The terms and provisions contained in the Convertible Notes
shall constitute, and are hereby expressly made, a part of this Indenture and
the Company and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and to be bound thereby.
(a) Global Notes. The Convertible Notes are being offered and sold by
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the Company pursuant to a purchase agreement relating to the Convertible Notes
dated April 23, 1996 between the Company and the Initial Purchaser (the
"Purchase Agreement").
Convertible Notes offered and sold to qualified institutional buyers
as defined in Rule 144A ("QIBs") in reliance on Rule 144A shall be issued
initially in the form of Rule 144A Global Notes, which shall be deposited on
behalf of the purchasers of the Convertible Notes represented thereby with the
Depositary at its office in The City of New York, and registered in the name of
the Depositary or a nominee of the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the Rule 144A Global Notes may from time to time be increased or
decreased by adjustments made on the records of the Trustee and the Depositary
or its nominee as hereinafter provided. The Trustee shall not be liable for any
error or omission by the Depositary in making such record adjustments and the
records of the Trustee shall be controlling with regard to outstanding principal
amount of Convertible Notes hereunder.
Convertible Notes offered and sold in reliance on Regulation S shall
be issued initially in the form of the Regulation S Temporary Global Note, which
shall be deposited on behalf of the purchasers of the Convertible Notes
represented thereby with the Trustee, at its office in St. Xxxx, Minnesota, as
custodian for the Depositary, and registered in the name of the Depositary or
the nominee of the Depositary for the investors' respective accounts at Xxxxxx
Guaranty Trust Company of New York, Brussels office, as operator of the
Euroclear System ("Euroclear") or Cedel Bank Societe Anonyme ("Cedel") duly
executed by the Company and authenticated by the Trustee as hereinafter
provided. The "40-day restricted period" (as defined in Regulation S) shall be
terminated upon the receipt by the Trustee of (i) a written certificate from the
Depositary, together with copies of certificates from Euroclear and Cedel,
certifying that they have received certification of non-United States beneficial
ownership of 100% of the aggregate principal amount of the Regulation S
Temporary Global Note (except to the extent of any beneficial owners thereof who
acquired an interest therein pursuant to another exemption from registration
under the Securities Act and who will take delivery of a beneficial ownership
interest in a Rule 144A Global Note, all as contemplated by Section 2.06(a)(ii)
hereof), and (ii) an Officers' Certificate from the Company.
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Following the termination of the 40-day restricted period, beneficial interests
in the Regulation S Temporary Global Note shall be exchanged for beneficial
interests in Regulation S Permanent Global Notes which will be deposited with a
custodian and registered in the name of a nominee of the Depositary.
Simultaneously with the authentication of Regulation S Permanent Global Notes,
the Trustee shall cancel the Regulation S Temporary Global Note. The aggregate
principal amount of the Regulation S Temporary Global Note and the Regulation S
Permanent Global Notes may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or its
nominee, as the case may be, in connection with transfers of interest as
hereinafter provided. The Trustee shall incur no liability for any error or
omission of the Depositary in making such record adjustments and the records of
the Trustee shall be controlling with regard to outstanding principal amount of
Regulation S Global Notes hereunder.
Each Global Note shall represent such of the outstanding Convertible
Notes as shall be specified therein and each shall provide that it shall
represent the aggregate amount of outstanding Convertible Notes from time to
time endorsed thereon and that the aggregate amount of outstanding Convertible
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges and redemptions. Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the amount of
outstanding Convertible Notes represented thereby shall be made by the Trustee
or the custodian, at the direction of the Trustee, in accordance with
instructions given by the holder thereof as required by Section 2.06 hereof.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "Management
Regulations" and "Instructions to Participants" of Cedel shall be applicable to
interests in the Regulation S Temporary Global Note and the Regulation S
Permanent Global Notes that are held by the Agent Member through Euroclear or
Cedel.
Except as set forth in Section 2.06 hereof, the Global Notes may be
transferred, in whole and not in part, only to another nominee of the Depositary
or to a successor of the Depositary or its nominee.
(b) Book-Entry Provisions. This Section 2.01(b) shall apply only to
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the Rule 144A Global Note and the Regulation S Permanent Global Note deposited
with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.01(b), authenticate and deliver the Rule 144A Global Note and the
Regulation S Permanent Global Note which (i) shall be registered in the name of
the Depositary or the nominee of the Depositary and (ii) shall be delivered by
the Trustee to the Depositary or pursuant to the Depositary's instructions or
held by the Trustee as custodian for the Depositary.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights either under this Indenture with respect to any Global Note held
on their behalf by the Depositary or by the Trustee as custodian for the
Depositary or under such Global Note, and the Depositary may be treated by the
Company, the Trustee and any agent of the Company or the Trustee as the absolute
owner of such Global Note for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee or any agent of
the Company or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by the Depositary or impair, as between
the Depositary and its Agent Members, the operation of
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customary practices of such Depositary governing the exercise of the rights of
an owner of a beneficial interest in any Global Note.
(c) Certificated Convertible Notes. Except as provided in Sections
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2.06(f) and 2.10, owners of beneficial interests in Global Notes will not be
entitled to receive physical delivery of certificated Convertible Notes.
Purchasers of Notes who are institutional "accredited investors" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act and
referred to as "Institutional Accredited Investors") who are not QIBs will
receive certificated Convertible Notes bearing the Restricted Convertible Notes
Legend set forth in Exhibit A-1 hereto ("Restricted Convertible Notes").
Restricted Convertible Notes will bear the Restricted Convertible Notes Legend
set forth on Exhibit A-1 unless removed in accordance with Section 2.06(b)
hereof and may not be exchanged for a Global Note, or interest therein, at any
time.
Upon a transfer of any Convertible Note during the period of the
effectiveness of a Shelf Registration Statement with respect to the Convertible
Notes, all requirements pertaining to legends on such Convertible Note will
cease to apply, the requirements requiring any such Convertible Note issued to
certain holders be issued in global form will cease to apply, and a certificated
Convertible Note without legends will be available to the holder of such
Convertible Notes.
SECTION 2.02. Execution and Authentication. Two officers shall sign
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the Convertible Notes for the Company by manual or facsimile signature. The
Company's seal shall be reproduced, either manually or by facsimile, on the
Convertible Notes.
If an officer whose signature is on a Convertible Note no longer holds
that office at the time the Convertible Note is authenticated, the Convertible
Note shall nevertheless be valid.
A Convertible Note shall not be valid until authenticated by the
manual signature of an authorized officer of the Trustee. The signature shall
be conclusive evidence that the Convertible Note has been authenticated under
this Indenture.
Upon a written order of the Company signed by two Officers, the
Trustee shall authenticate the Convertible Notes for original issue up to an
aggregate principal amount of $50,000,000 (plus up to $7,500,000 aggregate
principal amount of Convertible Notes that may be sold by the Company pursuant
to the over-allotment option granted pursuant to the Purchase Agreement). The
aggregate principal amount of Convertible Notes outstanding at any time shall
not exceed such amount except as provided in Section 2.07.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Convertible Notes. An authenticating agent may
authenticate Convertible Notes whenever the Trustee may do so. Each reference
in this Indenture to authentication by the Trustee includes authentication by
such agent. An authenticating agent has the same rights as an Agent to deal
with the Company or an Affiliate.
SECTION 2.03. Registrar, Paying Agent and Conversion Agent. The
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Company shall maintain in the Borough of Manhattan in The City of New York (i)
an office or agency where Convertible Notes may be presented for registration of
transfer or for exchange ("Registrar"), (ii) an office or agency where
Convertible Notes may be presented for payment ("Paying Agent") and (iii) an
office or agency where Convertible Notes may be presented for conversion
("Conversion
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Agent"). The Registrar shall keep a register of the Convertible Notes and of
their transfer and exchange. The Company may appoint the Registrar, the Paying
Agent and the Conversion Agent and may appoint one or more co-registrars, one or
more additional paying agents and one or more additional conversion agents in
such other locations as it shall determine. The term "Paying Agent" includes any
additional paying agent and the term "Conversion Agent" includes any additional
conversion agent. The Company may change any Paying Agent, Registrar, co-
registrar or Conversion Agent without prior notice to any Noteholder. The
Company shall notify the Trustee of the name and address of any Agent not a
party to this Indenture. If the Company fails to appoint or maintain another
entity as Registrar, Paying Agent or Conversion Agent, the Trustee shall act as
such. The Company or any of its Affiliates may act as Paying Agent, Registrar,
co-registrar or Conversion Agent.
SECTION 2.04. Paying Agent to Hold Money in Trust. The Company shall
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require each Paying Agent other than the Trustee to agree in writing that the
Paying Agent will hold in trust for the benefit of Noteholders or the Trustee
all money held by the Paying Agent for the payment of principal or interest on
the Convertible Notes, and will notify the Trustee of any default by the Company
in making any such payment. While any such default continues, the Trustee may
require a Paying Agent to pay all money held by it to the Trustee. The Company
at any time may require a Paying Agent to pay all money held by it to the
Trustee and to account for any money disbursed by it. Upon payment over to the
Trustee, the Paying Agent (if other than the Company or an Affiliate of the
Company) shall have no further liability for the money. If the Company or an
Affiliate of the Company acts as Paying Agent, it shall segregate and hold in a
separate trust fund for the benefit of the Noteholders all money held by it as
Paying Agent.
SECTION 2.05. Noteholder Lists. The Trustee shall preserve in as
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current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Noteholders. If the Trustee is not the Registrar,
the Company shall furnish to the Trustee on or before each interest payment date
and at such other times as the Trustee may request in writing a list in such
form and as of such date as the Trustee may reasonably require of the names and
addresses of Noteholders.
SECTION 2.06. Transfer and Exchange.
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(a) Transfer and Exchange of Global Notes. The transfer and exchange
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of Global Notes or beneficial interests therein shall be effected through the
Depositary, in accordance with this Indenture and the procedures of the
Depositary therefor, which shall include restrictions on transfer comparable to
those set forth herein to the extent required by the Securities Act. Beneficial
interests in a Global Note may be transferred to persons who take delivery
thereof in the form of a beneficial interest in the same Global Note in
accordance with the transfer restrictions set forth in the legend in subsection
(g) of this Section 2.06. Transfers of beneficial interests in the Global Notes
to persons required to take delivery thereof in the form of an interest in
another Global Note shall be permitted as follows:
(i) Rule 144A Global Note to Regulation S Global Note. If, at
any time, an owner of a beneficial interest in a Rule 144A
Global Note deposited with the Depositary (or the Trustee as
custodian for the Depositary) wishes to transfer its
interest in such Rule 144A Global Note to a person who is
required or permitted to take delivery thereof in the form
of an interest in a Regulation S Global Note, such owner
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shall, subject to compliance with the applicable procedures
described herein (the "Applicable Procedures"), exchange or
cause the exchange of such interest for an equivalent
beneficial interest in a Regulation S Global Note as
provided in this Section 2.06(a)(i). Upon receipt by the
Trustee of (1) instructions given in accordance with the
Applicable Procedures from an Agent Member directing the
Trustee to credit or cause to be credited a beneficial
interest in the Regulation S Global Note in an amount equal
to the beneficial interest in the Rule 144A Global Note to
be exchanged, (2) a written order given in accordance with
the Applicable Procedures containing information regarding
the participant account of the Depositary and the Euroclear
or Cedel account to be credited with such increase, and (3)
a certificate in the form of Exhibit B-1 hereto given by the
owner of such beneficial interest stating that the transfer
of such interest has been made in compliance with the
transfer restrictions applicable to the Global Notes and
pursuant to and in accordance with Rule 903 or Rule 904 of
Regulation S, then the Trustee, as Registrar, shall instruct
the Depositary to reduce or cause to be reduced the
aggregate principal amount at maturity of the applicable
Rule 144A Global Note and to increase or cause to be
increased the aggregate principal amount at maturity of the
applicable Regulation S Global Note by the principal amount
at maturity of the beneficial interest in the Rule 144A
Global Note to be exchanged, to credit or cause to be
credited to the account of the person specified in such
instructions a beneficial interest in the Regulation S
Global Note equal to the reduction in the aggregate
principal amount at maturity of the Rule 144A Global Note,
and to debit, or cause to be debited, from the account of
the person making such exchange or transfer the beneficial
interest in the Rule 144A Global Note that is being
exchanged or transferred.
(ii) Regulation S Global Note to Rule 144A Global Note. If, at
any time, an owner of a beneficial interest in a Regulation
S Global Note deposited with the Depositary or with the
Trustee as custodian for the Depositary wishes to transfer
its interest in such Regulation S Global Note to a person
who is required or permitted to take delivery thereof in the
form of an interest in a Rule 144A Global Note, such owner
shall, subject to the Applicable Procedures, exchange or
cause the exchange of such interest for an equivalent
beneficial interest in a Rule 144A Global Note as provided
in this Section 2.06(a)(ii). Upon receipt by the Trustee of
(1) instructions from Euroclear or Cedel, if applicable, and
the Depositary, directing the Trustee, as Registrar, to
credit or cause to be credited a beneficial interest in the
Rule 144A Global Note equal to the beneficial interest in
the Regulation S Global Note to be exchanged, such
instructions to contain information regarding the
participant account with the Depositary to be credited with
such increase, (2) a written order given in accordance with
the Applicable Procedures containing information regarding
the participant account of the Depositary and (3) if such
transfer is being effected prior to the expiration of the
"40 day restricted period" (as
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defined by Regulation S under the Securities Act), a
certificate in the form of Exhibit B-2 attached hereto given
by the owner of such beneficial interest stating (A) if the
transfer is pursuant to Rule 144A, that the person
transferring such interest in a Regulation S Global Note
reasonably believes that the person acquiring such interest
in a Rule 144A Global Note is a QIB and is obtaining such
beneficial interest in a transaction meeting the
requirements of Rule 144A and any applicable blue sky or
securities laws of any state of the United States, (B) that
the transfer complies with the requirements of Rule 144A
under the Securities Act and any applicable blue sky or
securities laws of any state of the United States or (C) if
the transfer is pursuant to any other exemption from the
registration requirements of the Securities Act, that the
transfer of such interest has been made in compliance with
the transfer restrictions applicable to the Global Notes and
pursuant to and in accordance with the requirements of the
exemption claimed, such statement to be supported by an
Opinion of Counsel from the transferee or the transferor in
form reasonably acceptable to the Company and to the
Registrar, then the Trustee, as Registrar, shall instruct
the Depositary to reduce or cause to be reduced the
aggregate principal amount at maturity of such Regulation S
Global Note and to increase or cause to be increased the
aggregate principal amount at maturity of the applicable
Rule 144A Global Note by the principal amount at maturity of
the beneficial interest in the Regulation S Global Note to
be exchanged, and the Trustee, as Registrar, shall instruct
the Depositary, concurrently with such reduction, to credit
or cause to be credited to the account of the person
specified in such instructions a beneficial interest in the
applicable Rule 144A Global Note equal to the reduction in
the aggregate principal amount at maturity of such
Regulation S Global Note and to debit or cause to be debited
from the account of the person making such transfer the
beneficial interest in the Regulation S Global Note that is
being transferred.
(b) Transfer and Exchange of Certificated Convertible Notes. When
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certificated Convertible Notes are presented by a holder to the Registrar with a
request:
(x) to register the transfer of the Certificated Notes; or
(y) to exchange such certificated Convertible Notes for an equal
principal amount of certificated Convertible Notes of other
authorized denominations,
the Registrar shall register the transfer or make the exchange as requested;
provided, however, that the certificated Convertible Notes presented or
surrendered for register of transfer or exchange:
(i) shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the
Registrar duly executed by such holder or by his attorney,
duly authorized in writing; and
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(ii) in the case of a certificated Convertible Note that is
a Restricted Convertible Note, such request shall be
accompanied by the following additional information and
documents, as applicable:
(A) if such Restricted Convertible Note is being
delivered to the Registrar by a holder for
registration in the name of such holder, without
transfer, or such Restricted Convertible Note is
being transferred to the Company, no certification
is required;
(B) if such Restricted Convertible Note is being
transferred to a QIB in accordance with Rule 144A
under the Securities Act or pursuant to an
exemption from registration in accordance with Rule
144 under the Securities Act or pursuant to an
effective registration statement under the
Securities Act, a certification to that effect from
such holder (in substantially the form of Exhibit
B-3 hereto); or
(C) if such Restricted Convertible Note is being
transferred in reliance on any other exemption from
the registration requirements of the Securities
Act, a certification to that effect from such
holder (in substantially the form of Exhibit B-3
hereto) and an Opinion of Counsel from such holder
or the transferee reasonably acceptable to the
Company and to the Registrar to the effect that
such transfer is in compliance with the Securities
Act.
(c) Transfer of a Beneficial Interest in a Rule 144A Global Note or
Regulation S Permanent Global Note for a certificated
Convertible Note.
(i) Any person having a beneficial interest in a Rule 144A
Global Note or Regulation S Permanent Global Note may
upon request, subject to the Applicable Procedures,
exchange such beneficial interest for a certificated
Convertible Note. Upon receipt by the Trustee of
written instructions or such other form of instructions
as is customary for the Depositary (or Euroclear or
Cedel, if applicable), from the Depositary or its
nominee on behalf of any person having a beneficial
interest in a Rule 144A Global Note or Regulation S
Permanent Global Note, and, in the case of a Restricted
Convertible Note, the following additional information
and documents (all of which may be submitted by
facsimile):
(A) if such beneficial interest is being transferred to
the person designated by the Depositary as being
the beneficial owner, a certification to that
effect from such person (in substantially the form
of Exhibit B-4 hereto);
(B) if such beneficial interest is being transferred to
a QIB in accordance with Rule 144A under the
Securities Act or
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pursuant to an exemption from registration in
accordance with Rule 144 under the Securities Act or
pursuant to an effective registration statement under
the Securities Act, a certification to that effect from
the transferor (in substantially the form of Exhibit B-
4 hereto); or
(C) if such beneficial interest is being transferred in
reliance on any other exemption from the registration
requirements of the Securities Act, a certification to
that effect from the transferor (in substantially the
form of Exhibit B-4 hereto) and an Opinion of Counsel
from the transferee or the transferor reasonably
acceptable to the Company and to the Registrar to the
effect that such transfer is in compliance with the
Securities Act,
in which case the Trustee or the custodian, at the direction
of the Trustee, shall, in accordance with the standing
instructions and procedures existing between the Depositary
and the custodian, cause the aggregate principal amount of
Rule 144A Global Notes or Regulation S Permanent Global
Notes, as applicable, to be reduced accordingly and,
following such reduction, the Company shall execute and, the
Trustee shall authenticate and deliver to the transferee a
certificated Convertible Note in the appropriate principal
amount.
(ii) Certificated Convertible Notes issued in exchange for a
beneficial interest in a Rule 144A Global Note or Regulation
S Permanent Global Note, as applicable, pursuant to this
Section 2.06(c) shall be registered in such names and in
such authorized denominations as the Depositary, pursuant to
instructions from its direct or indirect participants or
otherwise, shall instruct the Trustee. The Trustee shall
deliver such certificated Convertible Notes to the persons
in whose names such Convertible Notes are so registered.
Following any such issuance of certificated Convertible
Notes, the Trustee, as Registrar, shall instruct the
Depositary to reduce or cause to be reduced the aggregate
principal amount at maturity of the applicable Global Note
to reflect the transfer.
(d) Restrictions on Transfer and Exchange of Global Notes.
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Notwithstanding any other provision of this Indenture (other than the provisions
set forth in subsection (f) of this Section 2.06 or Section 2.10), a Global Note
may not be transferred as a whole except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
(e) Transfer and Exchange of a Certificated Convertible Note for a
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Beneficial Interest in a Global Note. A certificated Convertible Note may not
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be transferred or exchanged for a beneficial interest in a Global Note.
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(f) Authentication of Certificated Convertible Note in Absence of
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Depositary. If at any time:
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(i) the Depositary for the Convertible Notes notifies the
Company that the Depositary is unwilling or unable to
continue as Depositary for the Global Notes and a successor
Depositary for the Global Notes is not appointed by the
Company within 90 days after delivery of such notice; or
(ii) the Company, at its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of certificated
Convertible Notes under this Indenture,
then the Company shall execute, and the Trustee shall, upon receipt of an
authentication order in accordance with Section 2.02 hereof, authenticate and
deliver, certificated Convertible Notes in an aggregate principal amount equal
to the principal amount of the Global Notes in exchange for such Global Notes.
(g) Legends.
(i) Except as permitted by the following paragraphs (ii) and
(iii), each Convertible Note certificate evidencing
certificated Convertible Notes (and all Convertible Notes
issued in exchange therefor or substitution thereof) shall
bear legends in substantially the following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT
THIS SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X)
PRIOR TO THE THIRD ANNIVERSARY OF THE ISSUANCE HEREOF (OR ANY
PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT WAS AN
AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING
THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE
COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
WITHIN THE MEANING OF RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (3) IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON
THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
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SECURITY), AND, IF SUCH TRANSFER IS BEING EFFECTED BY CERTAIN
TRANSFERORS SPECIFIED IN THE INDENTURE (AS DEFINED BELOW) PRIOR TO THE
EXPIRATION OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING OF
RULE 903(c)(3) OF REGULATION S UNDER THE SECURITIES ACT), A
CERTIFICATE WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRUSTEE IS
DELIVERED BY THE TRANSFEREE TO THE COMPANY AND THE TRUSTEE, (4) TO AN
INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE
501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT
(AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE
OF TRANSFER ON THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING THIS
SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND A
CERTIFICATE IN THE FORM ATTACHED TO THIS SECURITY IS DELIVERED BY THE
TRANSFEREE TO THE COMPANY AND THE TRUSTEE (PROVIDED THAT CERTAIN
HOLDERS SPECIFIED IN THE INDENTURE MAY NOT TRANSFER THIS SECURITY
PURSUANT TO THIS CLAUSE (4) PRIOR TO THE EXPIRATION OF THE "40 DAY
RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE 903(c)(3) OF REGULATION
S UNDER THE SECURITIES ACT), (5) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF
APPLICABLE) UNDER THE SECURITIES ACT, OR (6) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES. AN INSTITUTIONAL ACCREDITED INVESTOR HOLDING THIS
SECURITY AGREES THAT IT WILL FURNISH TO THE COMPANY AND THE TRUSTEE
SUCH CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE
TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE
FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT
IS (1) A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
OR (2) AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN
RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES
ACT AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND
NOT FOR DISTRIBUTION OR (3) A NON-U.S. PERSON OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE
REQUIREMENTS OF PARAGRAPH (o)(2) OF RULE 902 UNDER) REGULATION S UNDER
THE SECURITIES ACT."
(ii) Upon any sale or transfer of a Restricted Convertible Note
(including any Restricted Convertible Note represented by a
Global Note) pursuant to Rule 144 under the Securities Act
or pursuant to an effective registration statement under the
Securities Act:
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(A) in the case of any Restricted Convertible Note that is
a certificated Convertible Note, the Registrar shall
permit the holder thereof to exchange such Restricted
Convertible Note for a certificated Convertible Note
that does not bear the legend set forth in (i) above
and rescind any restriction on the transfer of such
Restricted Convertible Note upon receipt of a
certification from the transferring holder
substantially in the form of Exhibit B-4 hereto; and
(B) in the case of any Restricted Convertible Note
represented by a Global Note, such Restricted
Convertible Note shall not be required to bear the
legend set forth in (i) above, but shall continue to be
subject to the provisions of Section 2.06(a) and (b)
hereof; provided, however, that with respect to any
request for an exchange of a Restricted Convertible
Note that is represented by a Global Note for a
certificated Convertible Note that does not bear the
legend set forth in (i) above, which request is made in
reliance upon Rule 144 under the Securities Act, the
holder thereof shall certify in writing to the
Registrar that such request is being made pursuant to
Rule 144 under the Securities Act (such certification
to be substantially in the form of Exhibit B-4 hereto).
(iii) Upon any sale or transfer of a Restricted Convertible Note
(including any Restricted Convertible Note represented by a
Global Note) in reliance on any exemption from the
registration requirements of the Securities Act (other than
exemptions pursuant to Rule 144A or Rule 144 under the
Securities Act) in which the holder or the transferee
provides an Opinion of Counsel to the Company and the
Registrar in form and substance reasonably acceptable to the
Company and the Registrar (which Opinion of Counsel shall
also state that the transfer restrictions contained in the
legend are no longer applicable):
(A) in the case of any Restricted Convertible Note that is
a certificated Convertible Note, the Registrar shall
permit the holder thereof to exchange such Restricted
Convertible Note for a certificated Convertible Note
that does not bear the legend set forth in (i) above
and rescind any restriction on the transfer of such
Restricted Convertible Note; and
(B) in the case of any Restricted Convertible Note
represented by a Global Note, such Restricted
Convertible Note shall not be required to bear the
legend set forth in (i) above, but shall continue to be
subject to the provisions of Section 2.06(a) and (b)
hereof.
(h) The Initial Purchaser shall not be required to deliver, and
neither the Company nor the Trustee shall demand therefrom, any of the
certifications or opinions described in this Section 2.06 in connection with the
initial issuance and delivery by the Company of the Convertible
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Notes on the effective date hereof or on the date of any settlement in
connection with the exercise of the over-allotment option granted to the Initial
Purchaser in the Purchase Agreement, including with respect to the issuance and
delivery of Convertible Notes that are Restricted Convertible Notes.
SECTION 2.07. Replacement Convertible Notes. If the holder of a
-----------------------------
Convertible Note claims that the Convertible Note has been lost, destroyed or
wrongfully taken or if such Convertible Note is mutilated and is surrendered to
the Trustee, the Company shall issue and the Trustee shall authenticate a
replacement Convertible Note if the Trustee's and the Company's requirements are
met. If required by the Trustee or the Company, an indemnity bond must be
sufficient in the judgment of both to protect the Company, the Trustee, any
Agent or any authenticating agent from any loss which any of them may suffer if
a Convertible Note is replaced. The Company may charge for its expenses in
replacing a Convertible Note.
In case any such mutilated, destroyed, lost or stolen Convertible Note
has become or is about to become due and payable, or is about to be purchased by
the Company pursuant to Article III hereof, the Company in its discretion may,
instead of issuing a new Convertible Note, pay or purchase such Convertible
Note, as the case may be.
Every replacement Convertible Note is an additional obligation of the
Company.
SECTION 2.08. Outstanding Convertible Notes. The Convertible Notes
-----------------------------
outstanding at any time are all the Convertible Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation,
and those described in this Section as not outstanding.
If a Convertible Note is replaced, paid or purchased pursuant to
Section 2.07 hereof, it ceases to be outstanding unless the Trustee receives
proof satisfactory to it that the replaced, paid or purchased Convertible Note
is held by a bona fide purchaser.
If Convertible Notes are considered paid under Section 4.01 hereof,
they cease to be outstanding and interest on them ceases to accrue.
A Convertible Note does not cease to be outstanding because the
Company or an Affiliate of the Company holds the Convertible Note.
SECTION 2.09. Treasury Convertible Notes. In determining whether the
--------------------------
Noteholders of the required principal amount of Convertible Notes have concurred
in any direction, waiver or consent, Convertible Notes owned by the Company or
an Affiliate of the Company shall be considered as though they are not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Convertible Notes which a Trust Officer of the Trustee actually knows are so
owned shall be so disregarded.
SECTION 2.10. Temporary Convertible Notes; Exchange of Global Note
----------------------------------------------------
for Certificated Convertible Note.
---------------------------------
(a) Until definitive Convertible Notes are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary Convertible
Notes. Temporary Convertible Notes shall be substantially in the form of
definitive Convertible Notes but may have variations that the Company considers
appropriate for temporary Convertible Notes. On or prior to the date the
-20-
Shelf Registration becomes effective, the Company shall prepare and the Trustee
shall authenticate definitive Convertible Notes in exchange for temporary
Convertible Notes.
(b) A Global Note deposited with the Depositary or with the Trustee as
custodian for the Depositary pursuant to Section 2.01 shall be transferred to
the beneficial owners thereof in the form of certificated Convertible Notes only
if such transfer complies with Section 2.06 and (i) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for such Global
Note or if at any time such Depositary ceases to be a "clearing agency"
registered under the Exchange Act and a successor depositary is not appointed by
the Company within 90 days of such notice, or (ii) an Event of Default has
occurred and is continuing.
(c) Any Global Note that is transferable to the beneficial owners
thereof in the form of certificated Convertible Notes pursuant to this Section
2.10 shall be surrendered by the Depositary to the Trustee at an office located
in The City of New York, to be so transferred, in whole or from time to time in
part, without charge, and the Trustee shall authenticate and deliver, upon such
transfer of each portion of such Global Note, an equal aggregate principal
amount at maturity of Convertible Notes of authorized denominations in the form
of certificated Convertible Notes. Any portion of a Global Note transferred
pursuant to this Section shall be executed, authenticated and delivered only in
denominations of $1,000 and any integral multiple thereof and registered in such
names as the Depositary shall direct. Any Convertible Notes in the form of
certificated Convertible Notes delivered in exchange for an interest in the
Global Note shall, except as otherwise provided by Section 2.06(b), bear the
Restricted Convertible Notes Legend set forth in Exhibit A hereto.
(d) The registered holder of a Global Note may grant proxies and
otherwise authorize any person, including Agent Members 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 Convertible Notes.
(e) In the event of the occurrence of either of the events specified
in Section 2.10(b), the Company will as soon as practicable make available to
the Trustee a reasonable supply of certificated Convertible Notes in definitive,
fully registered form without interest coupons.
SECTION 2.11. Cancellation. The Company at any time may deliver
------------
Convertible Notes to the Trustee for cancellation. The Registrar, Paying Agent
and Conversion Agent shall forward to the Trustee any Convertible Notes
surrendered to them for registration of transfer, redemption, conversion,
exchange or payment. The Trustee shall promptly cancel all Convertible Notes
surrendered for registration of transfer, redemption, conversion, exchange,
payment, replacement or cancellation and shall dispose of canceled Convertible
Notes as the Company directs. The Company may not issue new Convertible Notes to
replace Convertible Notes that it has paid or that have been delivered to the
Trustee for cancellation or that any holder has converted.
SECTION 2.12. Defaulted Interest. If the Company fails to make a
------------------
payment of interest on the Convertible Notes, it shall pay such defaulted
interest plus any interest payable on the defaulted interest, in any lawful
manner. It may pay such defaulted interest, plus any such interest payable on
it, to the persons who are Noteholders on a subsequent special record date. The
Company shall fix any such record date and payment date. At least 15 days
before any such record date, the Company shall mail to Noteholders a notice that
states the record date, payment date, and amount of such interest to be paid.
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ARTICLE III
Redemption
----------
SECTION 3.01. Notices to Trustee. If the Company elects to redeem
------------------
Convertible Notes pursuant to the Optional Redemption provision of Section 3.07
hereof, it shall notify the Trustee of the redemption date and the principal
amount of Convertible Notes to be redeemed. The Company shall give such notice
to the Trustee of any event or determination that obligates the Trustee to take
any action or give any notice under this Article III not less than twenty
business days prior to the first day in any period of time specified for the
Trustee to take such action or give such notice (unless a shorter notice period
shall be satisfactory to the Trustee).
SECTION 3.02. Selection of Convertible Notes to be Redeemed. If less
---------------------------------------------
than all the Convertible Notes are to be redeemed, the Trustee shall select the
Convertible Notes to be redeemed (which selection shall include compliance with
the requirements of the principal national securities exchange, if any, on which
the Convertible Notes are listed), on a pro rata basis, by lot or by such method
as the Trustee shall deem fair and appropriate. The Trustee shall make the
selection not more than 60 days and not less than 30 days before the redemption
date from Convertible Notes outstanding not previously called for redemption.
The Trustee may select for redemption portions of the principal of Convertible
Notes that have denominations larger than $1,000. Convertible Notes and
portions of them it selects shall be in amounts of $1,000 or integral multiples
of $1,000. Provisions of this Indenture that apply to Convertible Notes called
for redemption also apply to portions of Convertible Notes called for
redemption. The Trustee shall notify the Company promptly of the Convertible
Notes or portions of Convertible Notes to be called for redemption.
If any Convertible Note selected for partial redemption is converted
in part after such selection, the converted portion of such Convertible Note
shall be deemed (so far as may be) to be the portion to be selected for
redemption. The Convertible Notes (or portions thereof) so selected shall be
deemed duly selected for redemption for all purposes hereof, notwithstanding
that any such Convertible Note is converted in whole or in part before the
mailing of the notice of redemption. Upon any redemption of less than all the
Convertible Notes, the Company and the Trustee may treat as outstanding any
Convertible Notes surrendered for conversion during the period 15 days next
preceding the mailing of a notice of redemption and need not treat as
outstanding any Convertible Note authenticated and delivered during such period
in exchange for the unconverted portion of any Convertible Note converted in
part during such period.
SECTION 3.03. Notice of Redemption. At least 20 days but not more than
---------------------
60 days before a redemption date, the Company shall mail a notice of redemption
to each holder (other than DTC or any nominee thereof, who shall receive notice
from the Company at least 30 days before a redemption date) whose Convertible
Notes are to be redeemed at such holder's registered address.
The notice shall identify the Convertible Notes to be redeemed and
shall state:
(a) the redemption date;
(b) the redemption price;
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(c) if any Convertible Note is being redeemed in part, the portion of
the principal amount of such Convertible Note to be redeemed and that,
after the redemption date, upon cancellation of such Convertible Note, a
new Convertible Note or Convertible Notes in principal amount equal to the
unredeemed portion will be issued in the name of the holder thereof;
(d) the name and address of the Paying Agent;
(e) that Convertible Notes called for redemption must be surrendered
to the Paying Agent to collect the redemption price plus accrued interest;
(f) that, unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment pursuant
to the terms of this Indenture, interest on Convertible Notes called for
redemption ceases to accrue on and after the redemption date; and
(g) the paragraph of the Convertible Notes pursuant to which the
Convertible Notes called for redemption are being redeemed.
Such notice shall also state the current Conversion Price and the date
on which the right to convert such Convertible Notes or portions thereof into
Common Stock of the Company will expire.
At the Company's request, the Trustee shall give notice of redemption
in the Company's name and at its expense.
SECTION 3.04. Effect of Notice of Redemption. Once notice of
------------------------------
redemption is mailed in accordance with Section 3.03, Convertible Notes called
for redemption become due and payable on the redemption date at the redemption
price set forth in the Convertible Notes, including accrued and unpaid interest
up to but not including the redemption date. Upon surrender to the Trustee or
Paying Agent, such Convertible Notes called for redemption shall be paid at the
redemption price in the Convertible Notes, including interest, if any, accrued
and unpaid on the redemption date; provided that if the redemption date is after
--------
a regular record date and on or prior to the interest payment date relating to
such regular record date, the accrued interest shall be payable to the Holder of
the redeemed Convertible Notes registered on the relevant record date; and
provided, further, that if a redemption date is a Legal Holiday, payment shall
-------- -------
be made on the next succeeding Business Day and no interest shall accrue for the
period from such redemption date to such succeeding Business Day.
SECTION 3.05. Deposit of Redemption Price. On or before 2:00 p.m.,
---------------------------
New York City time, of the redemption date, the Company shall deposit with the
Trustee or with the Paying Agent money sufficient to pay the redemption price of
and accrued interest up to but not including the redemption date on all
Convertible Notes to be redeemed on that date unless theretofore converted into
Common Stock pursuant to the provisions hereof. The Trustee or the Paying Agent
shall return to the Company any money not required for that purpose.
If the Company complies with the preceding paragraph and the other
provision of this Article Three and payment of the Convertible Notes called for
redemption is not otherwise prohibited hereunder, interest on the Convertible
Notes to be redeemed will cease to accrue on the
-23-
applicable redemption date, whether or not such Convertible Notes are presented
for payment. Notwithstanding anything herein to the contrary, if any Security
surrendered for redemption in the manner provided in the Convertible Notes shall
not be so paid upon surrender for redemption because of the failure of the
Company to comply with the preceding paragraph, interest shall continue to
accrue and be paid from and including the redemption date until such payment is
made on the unpaid principal, and, to the extent lawful, on any interest not
paid on such unpaid principal, in each case at the rate and in the manner
provided in Section 4.01 hereof and in the Convertible Notes.
SECTION 3.06. Convertible Notes Redeemed in Part. Upon cancellation
----------------------------------
of a Convertible Note that is redeemed in part, the Company shall issue and the
Trustee shall authenticate for the holder at the expense of the Company a new
Convertible Note equal in principal amount to the unredeemed portion of the
Convertible Note surrendered.
SECTION 3.07. Optional Redemption. The Company may redeem all or any
-------------------
portion of the Convertible Notes, upon the terms and at the redemption prices
set forth in each of the Convertible Notes. Any redemption pursuant to this
Section 3.07 shall be made pursuant to the provisions of Section 3.01 through
3.06 hereof.
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SECTION 3.08. Designated Event Offer.
----------------------
(a) In the event that, pursuant to Section 4.07 hereof, the Company
shall commence a Designated Event Offer, the Company shall follow the procedures
in this Section 3.08.
(b) The Designated Event Offer shall remain open for a period
specified by the Company which shall be no less than 20 Business Days and no
more than 40 Business Days following its commencement on the date of the mailing
of notice in accordance with Section 4.07(b) hereof (the "Commencement Date"),
except to the extent that a longer period is required by applicable law (the
"Tender Period"). Upon the expiration of the Tender Period (the "Designated
Event Payment Date"), the Company shall purchase the principal amount of
Convertible Notes required to be purchased pursuant to Section 4.07 hereof (the
"Offer Amount").
(c) If the Designated Event Payment Date is on or after an interest
payment record date and on or before the related interest payment date, any
accrued interest will be paid to the person in whose name a Convertible Note is
registered at the close of business on such record date, and no additional
interest will be payable to Noteholders who tender Convertible Notes pursuant to
the Designated Event Offer.
(d) The Company shall provide the Trustee with notice of the
Designated Event Offer at least 10 calendar days before the Commencement Date.
(e) On or before the Commencement Date, the Company or the Trustee
(at the expense of the Company) shall send, by first class mail, a notice to
each of the Noteholders, which shall govern the terms of the Designated Event
Offer and shall state:
(i) that the Designated Event Offer is being made pursuant to this
Section 3.08 and Section 4.07 hereof and that all Convertible Notes
tendered will be accepted for payment;
(ii) the Offer Amount, the purchase price (as determined in accordance
with Section 4.07 hereof), the length of time the Designated Event Offer
will remain open and the Designated Event Payment Date;
(ii) that any Convertible Note or portion thereof not tendered or
accepted for payment will continue to accrue interest;
(iv) that, unless the Company defaults in the payment of the
Designated Event Payment, any Convertible Note or portion thereof accepted
for payment pursuant to the Designated Event Offer shall cease to accrue
interest after the Designated Event Payment Date;
(v) that Noteholders electing to have a Convertible Note or portion
thereof purchased pursuant to any Designated Event offer will be required
to surrender the Convertible Note, with the form entitled "Option of
Noteholder To Elect Purchase" on the reverse of the Convertible Note
completed, to the Paying Agent at the address specified in the notice prior
to the close of business on the third Business Day preceding the Designated
Event Payment Date;
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(vi) that Noteholders will be entitled to withdraw their election if
the Paying Agent receives, not later than the close of business on the
second Business Day preceding the Designated Event Payment Date, or such
longer period as may be required by law, a letter or a telegram, telex or
facsimile transmission (receipt of which is confirmed and promptly followed
by a letter) setting forth the name of the Noteholder, the principal amount
of the Convertible Note or portion thereof the Noteholder delivered for
purchase and a statement that such Noteholder is withdrawing his election
to have the Convertible Note or portion thereof purchased; and
(vii) that Noteholders whose Convertible Notes are being purchased
only in part will be issued new Convertible Notes equal in principal amount
to the unpurchased portion of the Convertible Notes surrendered, which
unpurchased portion must be equal to $1,000 in principal amount or an
integral multiple thereof.
In addition, the notice shall contain all instructions and materials
that the Company shall reasonably deem necessary to enable such Noteholders to
tender Convertible Notes pursuant to the Designated Event Offer.
(f) At least one Business Day prior to the Designated Event Payment
Date, the Company shall irrevocably deposit with the Trustee or a Paying Agent
in immediately available funds an amount equal to the Offer Amount to be held
for payment in accordance with the terms of this Section 3.08. On the Designated
Event Payment Date, the Company shall, to the extent lawful, (i) accept for
payment the Convertible Notes or portions thereof tendered pursuant to the
Designated Event Offer, (ii) deliver or cause to be delivered to the Trustee
Convertible Notes so accepted and (iii) deliver to the Trustee an Officers'
Certificate stating such Convertible Notes or portions thereof have been
accepted for payment by the Company in accordance with the terms of this Section
3.08. The Paying Agent shall promptly (but in any case not later than ten (10)
calendar days after the Designated Event Payment Date) mail or deliver to each
tendering Noteholder an amount equal to the purchase price of the Convertible
Notes tendered by such Noteholder, and the Trustee shall promptly authenticate
and mail or deliver to such Noteholders a new Convertible Note equal in
principal amount to any unpurchased portion of the Convertible Note surrendered,
if any; provided, that each new Convertible Note shall be in a principal amount
--------
of $1,000 or an integral multiple thereof. Any Convertible Notes not so
accepted shall be promptly mailed or delivered by or on behalf of the Company to
the holder thereof. The Company will publicly announce the results of the
Designated Event Offer on, or as soon as practicable after, the Designated Event
Payment Date.
(g) The Designated Event Offer shall be made by the Company in
compliance with all applicable provisions of the Exchange Act, and all
applicable tender offer rules promulgated thereunder, and shall include all
instructions and materials that the Company shall reasonably deem necessary to
enable such Noteholders to tender their Convertible Notes.
ARTICLE IV
Covenants
---------
SECTION 4.01. Payment of Convertible Notes. The Company shall pay the
----------------------------
principal of and interest on the Convertible Notes on the dates and in the
manner provided in the Convertible Notes. Principal and interest shall be
considered paid on the date due if the Paying Agent (other than the Company or
an Affiliate of the Company) holds on that date money designated for and
sufficient
-26-
to pay all principal and interest then due and such Paying Agent is not
prohibited from paying such money to the Noteholders on that date pursuant to
the terms of this Indenture. To the extent lawful, the Company shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (without regard to any
applicable grace period) at the rate borne by the Convertible Notes, compounded
semiannually.
If the Paying Agent pays out any amount due under the terms of the
Convertible Notes on or after the due date therefor on the assumption that the
corresponding payment for such amount has been or will be made by the Company
and such payment has in fact not been so made by the Company prior to the time
that the Paying Agent makes such payment, then the Company shall on demand
reimburse the Paying Agent for the relevant amount, and pay interest to the
Paying Agent on such amount from the date on which it is paid out to the date of
reimbursement at a rate per annum equal to the cost to the Paying Agent of
funding the amount paid out, as certified by the Paying Agent and expressed as a
rate per annum.
SECTION 4.02. SEC Reports. Whether or not required by the rules and
-----------
regulations of the SEC, so long as any Convertible Notes are outstanding, the
Company will furnish to the Trustee and to the holders of Convertible Notes all
quarterly and annual financial information required to be contained in a filing
with the SEC on Forms 10-Q and 10-K, including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and, with respect to
annual information only, a report thereon by the Company's certified independent
accountants.
SECTION 4.03. Compliance Certificate. The Company shall deliver to
----------------------
the Trustee, within 120 days after the end of each fiscal year of the Company,
an Officers' Certificate stating that a review of the activities of the Company
and its Subsidiaries, if any, during the preceding fiscal year has been made
under the supervision of the signing officers with a view to determining whether
the Company has kept, observed, performed and fulfilled its obligations under,
and complied with the covenants and conditions contained in, this Indenture, and
further stating, as to each such Officer signing such certificate, that to the
best of his knowledge the Company has kept, observed, performed and fulfilled
each and every covenant, and complied with the covenants and conditions
contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions hereof (or, if a
Default or Event of Default shall have occurred, describing all such Defaults or
Events of Default of which he may have knowledge) and that to the best of his
knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal or of interest, if any, on the Convertible
Notes are prohibited.
One of the Officers signing such Officers' Certificate shall be either
the Company's principal executive officer, principal financial officer or
principal accounting officer.
The Company will, so long as any of the Convertible Notes are
outstanding, deliver to the Trustee, forthwith upon becoming aware of:
(a) any Default, Event of Default or default in the performance of any
covenant, agreement or condition contained in this Indenture; or
(b) any event of default under any other mortgage, indenture or
instrument which event of default would likely result in an Event of
Default under Section 8.01(e),
-27-
an Officers' Certificate specifying such Default, Event of Default or default.
Immediately upon the occurrence of any event giving rise to additional
interest in respect of the Convertible Notes in accordance with Section 11
thereof or the termination of such additional interest, the Company shall give
the Trustee notice of such additional interest or termination thereof and of the
event giving rise to such additional interest or termination thereof (such
notice to be contained in an Officers' Certificate), and prior to receipt of
such Officers' Certificate the Trustee shall be entitled to assume that no such
additional interest is owing or that no termination thereof has occurred, as the
case may be.
SECTION 4.04. Stay, Extension and Usury Laws. The Company covenants
------------------------------
(to the extent that it may lawfully do so) that it will not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company (to the extent it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not, by resort to any such law, 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 has been enacted.
SECTION 4.05. Corporate Existence. Subject to Article VII hereof, the
-------------------
Company will do or cause to be done all things necessary to preserve and keep in
full force and effect its corporate existence and the corporate, partnership or
other existence of each Subsidiary of the Company in accordance with the
respective organizational documents of each Subsidiary and the rights (charter
and statutory), licenses and franchises of the Company and its Subsidiaries;
provided, however, that the Company shall not be required to preserve any such
-------- -------
right, license or franchise, or the corporate, partnership or other existence of
any Subsidiary, if the Board of Directors (as evidenced by a Board Resolution
certified by the Secretary of the Company) shall determine in good faith that
the preservation thereof is no longer desirable in the conduct of the business
of the Company and its Subsidiaries taken as a whole and that the loss thereof
is not adverse in any material respect to the Noteholders. Notwithstanding the
foregoing, the corporate existence or ownership of any Subsidiary may be
terminated or changed in connection with any Board-approved corporate
restructuring or reorganization.
SECTION 4.06. Taxes. The Company shall, and shall cause each of its
-----
Subsidiaries to, pay prior to delinquency all taxes, assessments and
governmental levies, except as contested in good faith and by appropriate
proceedings.
-28-
SECTION 4.07. Designated Event.
----------------
(a) Upon the occurrence of a Designated Event, each holder of
Convertible Notes shall have the right, in accordance with this Section 4.07 and
Section 3.08 hereof, to require the Company to repurchase all or any part (equal
to $1,000 or an integral multiple thereof) of such holder's Convertible Notes
pursuant to the terms of Section 3.08 (the "Designated Event Offer") at a
purchase price equal to 101% of the principal amount thereof, plus accrued and
unpaid interest thereon to the Designated Event Payment Date (the "Designated
Event Payment").
(b) Within 30 days following any Designated Event, the Company shall
mail to each holder the notice provided by Section 3.08(e).
SECTION 4.08. Stockholders Rights Plan. The Company shall take any
------------------------
and all action with respect to the Stockholders Rights Plan required to provide
the holders of Common Stock issuable upon conversion of the Convertible Notes
with the rights and other benefits such holder would have received if such
holder's Common Stock were issued and outstanding on the date of the Indenture
up to and including the date of determination. In the event that the Company
implements a new stockholder rights plan, such rights plan shall provide that
upon conversion of the Convertible Notes the holders will receive, in addition
to the Common Stock issuable upon such conversion, the rights issued under such
rights plan (whether or not such rights have separated from the Common Stock at
the time of such conversion), provided that a holder of Convertible Notes and
the Common Stock issuable upon conversion thereof shall be subject to all of the
terms and conditions of any such rights plan.
ARTICLE V
Conversion
----------
SECTION 5.01. Conversion Privilege. A holder of a Convertible Note
--------------------
may convert the principal amount thereof (or any portion thereof that is an
integral multiple of $1,000) into fully paid and nonassessable shares of Common
Stock of the Company at any time after 90 days following the date of original
issuance thereof and prior to the close of business (New York City time) on the
date of the Convertible Note's maturity at the Conversion Price then in effect,
except that, with respect to any Convertible Note called for redemption, such
conversion right shall terminate at the close of business on the third Business
Day immediately preceding the redemption date (unless the Company shall default
in making the redemption payment when it becomes due, in which case the
conversion right shall terminate on the date such default is cured). The number
of shares of Common Stock issuable upon conversion of a Convertible Note is
determined by dividing the principal amount of the Convertible Note converted by
the conversion price in effect on the Conversion Date (the "Conversion Price").
The initial Conversion Price is stated in paragraph 10 of the
Convertible Notes and is subject to adjustment as provided in this Article V.
Provisions of this Indenture that apply to conversion of all of a
Convertible Note also apply to conversion of a portion of it. A holder of
Convertible Notes is not entitled to any rights of a holder of Common Stock
(other than as provided in Section 4.08 hereof) until such holder of Convertible
Notes has converted such Convertible Notes into Common Stock, and only to the
extent
-29-
that such Convertible Notes are deemed to have been converted into Common Stock
under this Article V.
SECTION 5.02. Conversion Procedure. To convert a Convertible Note, a
--------------------
holder must satisfy the requirements in paragraph 10 of the Convertible Notes.
The date on which the holder satisfies all of those requirements is the
conversion date (the "Conversion Date"). As soon as practicable after the
Conversion Date, the Company shall deliver to the holder through the Conversion
Agent a certificate for the number of whole shares of Common Stock issuable upon
the conversion and a check for any fractional share determined pursuant to
Section 5.03. The person in whose name the certificate is registered shall
become the shareholder of record on the Conversion Date and, as of such date,
such person's rights as a Noteholder shall cease; provided, however, that no
-------- -------
surrender of a Convertible Note on any date when the stock transfer books of the
Company shall be closed shall be effective to constitute the person entitled to
receive the shares of Common Stock upon such conversion as the shareholder of
record of such shares of Common Stock on such date, but such surrender shall be
effective to constitute the person entitled to receive such shares of Common
Stock as the shareholder of record thereof for all purposes at the close of
business on the next succeeding day on which such stock transfer books are open;
provided further, however, that such conversion shall be at the Conversion Price
-------- ------- -------
in effect on the date that such Convertible Note shall have been surrendered for
conversion, as if the stock transfer books of the Company had not been closed.
No payment or adjustment will be made for accrued and unpaid interest
on a converted Convertible Note or for dividends or distributions on shares of
Common Stock issued upon conversion of a Convertible Note, but if any holder
surrenders a Convertible Note for conversion after the close of business on the
record date for the payment of an installment of interest and prior to the
opening of business on the next interest payment date, then, notwithstanding
such conversion, the interest payable on such interest payment date shall be
paid to the holder of such Convertible Note on such record date. In such event,
any such Convertible Note not called for redemption, when surrendered for
conversion, must be accompanied by payment in funds acceptable to the Company of
an amount equal to the interest payable on such interest payment date on the
portion so converted.
If a holder converts more than one Convertible Note at the same time,
the number of whole shares of Common Stock issuable upon the conversion shall be
based on the total principal amount of Convertible Notes converted.
Upon surrender of a Convertible Note that is converted in part, the
Trustee shall authenticate for the holder a new Convertible Note equal in
principal amount to the unconverted portion of the Convertible Note surrendered.
SECTION 5.03. Fractional Shares. The Company will not issue
-----------------
fractional shares of Common Stock upon conversion of a Convertible Note. In
lieu thereof, the Company will pay an amount in cash based upon the Daily Market
Price of the Common Stock on the trading day prior to the date of conversion.
SECTION 5.04. Taxes on Conversion. The issuance of certificates for
-------------------
shares of Common Stock upon the conversion of any Convertible Note shall be made
without charge to the converting Noteholder for such certificates or for any tax
in respect of the issuance of such certificates, and such certificates shall be
issued in the respective names of, or in such names as may
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be directed by, the holder or holders of the converted Convertible Note;
provided, however, that in the event that certificates for shares of Common
-------- -------
Stock are to be issued in a name other than the name of the holder of the
Convertible Note converted, such Convertible Note, when surrendered for
conversion, shall be accompanied by an instrument of transfer, in form
satisfactory to the Company, duly executed by the registered holder thereof or
his duly authorized attorney; and provided further, however, that the Company
-------- ------- -------
and Conversion Agent shall not be required to pay any tax which may be payable
in respect of any transfer involved in the issuance and delivery of any such
certificates in a name other than that of the holder of the converted
Convertible Note, and the Company shall not be required to issue or deliver such
certificates unless or until the person or persons requesting the issuance
thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been paid or is
not applicable.
SECTION 5.05. Company to Provide Stock. The Company shall at all
------------------------
times reserve and keep available, free from preemptive rights, out of its
authorized but unissued Common Stock, solely for the purpose of issuance upon
conversion of Convertible Notes as herein provided, a sufficient number of
shares of Common Stock to permit the conversion of all outstanding Convertible
Notes for shares of Common Stock.
All shares of Common Stock which may be issued upon conversion of the
Convertible Notes shall be duly authorized, validly issued, fully paid and
nonassessable when so issued.
Until such time as a Shelf Registration Statement becomes effective
with respect to shares of Common Stock issued upon conversion of the Convertible
Notes, any such shares of Common Stock shall be subject to the restrictions on
transfer, and may only be transferred or exchanged in accordance with
procedures, as are substantially consistent with the provisions of Section 2.06,
including, without limitation, with respect to certificated shares of such
Common Stock, the restrictive legend requirements of Section 2.06(g).
SECTION 5.06. Adjustment of Conversion Price. The Conversion Price
------------------------------
shall be subject to adjustment from time to time as follows:
(a) In case the Company shall (1) pay a dividend in shares of Common
Stock to holders of Common Stock, (2) make a distribution in shares of Common
Stock to holders of Common Stock, (3) subdivide its outstanding shares of Common
Stock into a greater number of shares of Common Stock or (4) combine its
outstanding shares of Common Stock into a smaller number of shares of Common
Stock, the Conversion Price in effect immediately prior to such action shall be
adjusted so that the holder of any Convertible Note thereafter surrendered for
conversion shall be entitled to receive the number of shares of Common Stock
which he would have owned immediately following such action had such Convertible
Notes been converted immediately prior thereto. Any adjustment made pursuant to
this subsection (a) shall become effective immediately after the record date in
the case of a dividend, or distribution and shall become effective immediately
after the effective date in the case of a subdivision or combination.
(b) In case the Company shall issue rights or warrants to
substantially all holders of Common Stock entitling them (for a period
commencing no earlier than the record date for the determination of holders of
Common Stock entitled to receive such rights or warrants and expiring not more
than 45 days after such record date) to subscribe for or purchase shares of
Common Stock (or securities convertible into Common Stock) at a price per share
less than the current market price
-31-
(as determined pursuant to subsection (f) below) of the Common Stock on such
record date, the Conversion Price shall be adjusted so that the same shall equal
the price determined by multiplying the Conversion Price in effect immediately
prior to such record date by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding on such record date, plus the
number of shares of Common Stock which the aggregate offering price of the
offered shares of Common Stock (or the aggregate conversion price of the
convertible securities so offered) would purchase at such current market price,
and of which the denominator shall be the number of shares of Common Stock
outstanding on such record date plus the number of additional shares of Common
Stock offered (or into which the convertible securities so offered are
convertible). Such adjustments shall become effective immediately after such
record date.
(c) In case the Company shall distribute to all holders of Common
Stock shares of any class of Capital Stock of the Company (other than Common
Stock), evidences of indebtedness or other assets (including securities, but
excluding those rights, warrants, dividends and distributions referred to in the
preceding clauses (a) and (b) and dividends and distributions in connection with
the liquidation, dissolution or winding up of the Company or paid exclusively
in cash out of current or retained earnings), or shall distribute to
substantially all holders of Common Stock rights or warrants to subscribe for
securities (other than those securities referred to in subsection (b) above),
then in each such case the Conversion Price shall be adjusted so that the same
shall equal the price determined by multiplying the Conversion Price in effect
immediately prior to the date of such distribution by a fraction of which the
numerator shall be the current market price (determined as provided in
subsection (f) below) of the Common Stock on the record date mentioned below
less the then fair market value (as determined by the Board of Directors, whose
determination shall be conclusive evidence of such fair market value and
described in a Board Resolution) of the portion of the assets so distributed or
of such subscription rights or warrants applicable to one share of Common Stock,
and of which the denominator shall be such current market price of the Common
Stock. Such adjustment shall become effective immediately after the record date
for the determination of the holders of Common Stock entitled to receive such
distribution. Notwithstanding the foregoing, in the event that the Company shall
distribute rights or warrants to subscribe for additional shares of the
Company's Capital Stock (other than the Common Stock referred to in subsection
(b) above) ("Rights") pro rata to holders of Common Stock, the Company may, in
lieu of making any adjustment pursuant to this Section 5.06, make proper
provision so that each holder of a Convertible Note who converts such
Convertible Note (or any portion thereof) after the record date for such
distribution and prior to the expiration or redemption of the Rights shall be
entitled to receive upon such conversion, in addition to the shares of Common
Stock issuable upon such conversion (the "Conversion Shares"), a number of
Rights to be determined as follows: (i) if such conversion occurs on or prior to
the date for the distribution to the holders of Rights of separate certificates
evidencing such Rights (the "Distribution Date"), the same number of Rights to
which a holder of a number of shares of Common Stock equal to the number of
Conversion Shares is entitled at the time of such conversion in accordance with
the terms and provisions of and applicable to the Rights; and (ii) if such
conversion occurs after the Distribution Date, the same number of Rights to
which a holder of the number of shares of Common Stock into which the principal
amount of the Convertible Note so converted was convertible immediately prior to
the Distribution Date would have been entitled on the Distribution Date in
accordance with the terms and provisions of and applicable to the Rights.
(d) In case the Company shall, by dividend or otherwise, at any time
distribute to all holders of its Common Stock cash (including any distributions
of cash out of current or retained earnings of the Company but excluding any
cash that is distributed as part of a distribution
-32-
requiring a Conversion Price adjustment pursuant to paragraph (c) of this
Section) in an aggregate amount that, together with the sum of (x) the aggregate
amount of any other distributions to all holders of its Common Stock made in
cash plus (y) all Excess Payments, in each case made within the 12 months
preceding the date fixed for determining the shareholders entitled to such
distribution (the "Distribution Record Date") and in respect of which no
Conversion Price adjustment pursuant to paragraphs (c) or (e) of this Section or
this paragraph (d) has been made, exceeds 15% of the product of the current
market price per share (determined as provided in paragraph (f) of this Section)
of the Common Stock on the Distribution Record Date times the number of shares
of Common Stock outstanding on the Distribution Record Date (excluding shares
held in the treasury of the Company), the Conversion Price shall be reduced so
that the same shall equal the price determined by multiplying such Conversion
Price in effect immediately prior to the effectiveness of the Conversion Price
reduction contemplated by this paragraph (d) by a fraction of which the
numerator shall be the current market price per share (determined as provided in
paragraph (f) of this Section) of the Common Stock on the Distribution Record
Date less the amount of such cash and other consideration (including any Excess
Payments) so distributed applicable to one share (based on the pro rata portion
of the aggregate amount of such cash and other consideration (including any
Excess Payments), divided by the shares of Common Stock outstanding on the
Distribution Record Date) of Common Stock and the denominator shall be such
current market price per share (determined as provided in paragraph (f) of this
Section) of the Common Stock on the Distribution Record Date, such reduction to
become effective immediately prior to the opening of business on the day
following the Distribution Record Date.
(e) In case a tender offer or other negotiated transaction made by the
Company or any Subsidiary of the Company for all or any portion of the Common
Stock shall be consummated, if an Excess Payment is made in respect of such
tender offer or other negotiated transaction and the amount of such Excess
Payment, together with the sum of (x) the aggregate amount of all Excess
Payments plus (y) the aggregate amount of all distributions to all holders of
the Common Stock made in cash (specifically including distributions of cash out
of retained earnings), in each case made within the 12 months preceding the date
of payment of such current negotiated transaction consideration or expiration of
such current tender offer, as the case may be (the "Purchase Date"), and as to
which no adjustment pursuant to paragraph (c) or paragraph (d) of this Section
or this paragraph (e) has been made, exceeds 15% of the product of the current
market price per share (determined as provided in paragraph (f) of this Section)
of the Common Stock on the Purchase Date times the number of shares of Common
Stock outstanding (including any tendered shares but excluding any shares held
in the treasury of the Company) on the Purchase Date, the Conversion Price shall
be reduced so that the same shall equal the price determined by multiplying such
Conversion Price in effect immediately prior to the effectiveness of the
Conversion Price reduction contemplated by this paragraph (e) by a fraction of
which the numerator shall be the current market price per share (determined as
provided in paragraph (f) of this Section) of the Common Stock on the Purchase
Date less the amount of such Excess Payments and such cash distributions, if
any, applicable to one share (based on the pro rata portion of the aggregate
amount of such Excess Payments and such cash distributions, divided by the
shares of Common Stock outstanding on the Purchase Date) of Common Stock and the
denominator shall be such current market price per share (determined as provided
in paragraph (f) of this Section) of the Common Stock on the Purchase Date, such
reduction to become effective immediately prior to the opening of business on
the day following the Purchase Date.
(f) The current market price per share of Common Stock on any date
shall be deemed to be the average of the Daily Market Prices for the shorter of
(i) 30 consecutive Business
-33-
Days ending on the last full trading day on the exchange or market referred to
in determining such Daily Market Prices prior to the time of determination or
(ii) the period commencing on the date next succeeding the first public
announcement of the issuance of such rights or such warrants or such other
distribution or such negotiated transaction through such last full trading day
on the exchange or market referred to in determining such Daily Market Prices
prior to the time of determination.
(g) In any case in which this Section 5.06 shall require that an
adjustment be made immediately following a record date for an event, the Company
may elect to defer, until such event, issuing to the holder of any Convertible
Note converted after such record date the shares of Common Stock and other
Capital Stock of the Company issuable upon such conversion over and above the
shares of Common Stock and other Capital Stock of the Company issuable upon such
conversion only on the basis of the Conversion Price prior to adjustment; and,
in lieu of the shares the issuance of which is so deferred, the Company shall
issue or cause its transfer agents to issue due bills or other appropriate
evidence of the right to receive such shares.
SECTION 5.07. No Adjustment. No adjustment in the Conversion Price
-------------
shall be required until cumulative adjustments amount to 1% or more of the
Conversion Price as last adjusted; provided, however, that any adjustments which
-------- -------
by reason of this Section 5.07 are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article V shall be made to the nearest cent or to the nearest one-
hundredth of a share, as the case may be. No adjustment need be made for 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.
SECTION 5.08. Other Adjustments. (a) In the event that, as a result of
-----------------
an adjustment made pursuant to Section 5.06 above, the holder of any Convertible
Note thereafter surrendered for conversion shall become entitled to receive any
shares of Capital Stock of the Company other than shares of its Common Stock,
thereafter the Conversion Price of such other shares so receivable upon
conversion of any Convertible Notes shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to Common Stock contained in this Article V.
(b) In the event that shares of Common Stock are not delivered after
the expiration of any of the rights or warrants referred to in Section 5.06(b)
and Section 5.06(c) hereof, the Conversion Price shall be readjusted to the
Conversion Price which would otherwise be in effect had the adjustment made upon
the issuance of such rights or warrants been made on the basis of delivery of
only the number of shares of Common Stock actually delivered.
SECTION 5.09. Adjustments for Tax Purposes. The Company may, at its
----------------------------
option, make such reductions in the Conversion Price, in addition to those
required by Section 5.06 above, as it determines to be advisable in order that
any stock dividend, subdivision of shares, distribution of rights to purchase
stock or securities or distribution of securities convertible into or
exchangeable for stock made by the Company to its shareholders will not be
taxable to the recipients thereof.
SECTION 5.10. Adjustments by the Company. The Company from time to
--------------------------
time may, to the extent permitted by law, reduce the Conversion Price by any
amount for any period of at least 20 days, in which case the Company shall give
at least 15 days' notice of such reduction in accordance with Section 5.11, if
the Board of Directors has made a determination that such reduction would be in
the best interests of the Company, which determination shall be conclusive.
-34-
SECTION 5.11. Notice of Adjustment. Whenever the Conversion Price is
--------------------
adjusted, the Company shall promptly mail to Noteholders at the addresses
appearing on the Registrar's books and the Conversion Agent a notice of the
adjustment and file with the Trustee an Officers Certificate briefly stating the
facts requiring the adjustment and the manner of computing it. The certificate
shall be conclusive evidence of the correctness of such adjustment.
SECTION 5.12. Notice of Certain Transactions. In the event that:
------------------------------
(1) the Company takes any action which would require an adjustment in
the Conversion Price;
(2) the Company takes any action that would require a supplemental
indenture pursuant to Section 5.13; or
(3) there is a dissolution or liquidation of the Company;
a holder of a Convertible Note may wish to convert such Convertible Note into
shares of Common Stock prior to the record date for or the effective date of the
transaction so that he may receive the rights, warrants, securities or assets
which a holder of shares of Common Stock on that date may receive. Therefore,
the Company shall mail to Noteholders at the addresses appearing on the
Registrar's books and the Conversion Agent and the Trustee a notice stating the
proposed record or effective date, as the case may be. The Company shall mail
the notice on or about the time notice is mailed to the shareholders of the
Company regarding such transaction or, if no notice is being mailed to the
shareholders of the Company, at least 10 days before the proposed record date or
effective date, as the case may be, regarding such transaction; however, failure
to mail such notice or any defect therein shall not affect the validity of any
transaction referred to in clause (1), (2) or (3) of this Section 5.12.
SECTION 5.13. Effect of Reclassifications, Consolidations, Mergers or
-------------------------------------------------------
Sales on Conversion Privilege. If any of the following shall occur, namely: (i)
-----------------------------
any reclassification or change of outstanding shares of Common Stock issuable
upon conversion of Convertible Notes (other than a change in par value, or from
par value to no par value, or from no par value to par value, or as a result of
a subdivision or combination), (ii) any consolidation or merger to which the
Company is a party other than a merger in which the Company is the continuing
corporation and which does not result in any reclassification of, or change
(other than a change in name, or par value, or from par value to no par value,
or from no par value to par value or as a result of a subdivision or
combination) in, outstanding shares of Common Stock or (iii) any sale or
conveyance of all or substantially all of the property or business of the
Company as an entirety, then the Company, or such successor or purchasing
corporation, as the case may be, shall, as a condition precedent to such
reclassification, change, consolidation, merger, sale or conveyance, execute and
deliver to the Trustee a supplemental indenture in form satisfactory to the
Trustee providing that the holder of each Convertible Note then outstanding
shall have the right to convert such Convertible Note into the kind and amount
of shares of stock and other securities and property (including cash) receivable
upon such reclassification, change, consolidation, merger, sale or conveyance by
a holder of the number of shares of Common Stock deliverable upon conversion of
such Convertible Note immediately prior to such reclassification, change,
consolidation, merger, sale or conveyance. Such supplemental indenture shall
provide for adjustments of the Conversion Price which shall be as nearly
equivalent as may be practicable to the adjustments of the Conversion Price
provided for in this Article V. The foregoing, however, shall not in any way
affect the right a holder of a Convertible Note may
-35-
otherwise have, pursuant to clause (ii) of the last sentence of subsection (c)
of Section 5.06, to receive Rights upon conversion of a Convertible Note. If, in
the case of any such consolidation, merger, sale or conveyance, the stock or
other securities and property (including cash) receivable thereupon by a holder
of Common Stock includes shares of stock or other securities and property of a
corporation other than the successor or purchasing corporation, as the case may
be, in such consolidation, merger, sale or conveyance, then such supplemental
indenture shall also be executed by such other corporation and shall contain
such additional provisions to protect the interests of the holders of the
Convertible Notes as the Board of Directors of the Company shall reasonably
consider necessary by reason of the foregoing. The provision of this Section
5.13 shall similarly apply to successive consolidations, mergers, sales or
conveyances.
In the event the Company shall execute a supplemental indenture
pursuant to this Section 5.13, the Company shall promptly file with the Trustee
an Officers' Certificate briefly stating the reasons therefor, the kind or
amount of shares of stock or securities or property (including cash) receivable
by holders of the Convertible Notes upon the conversion of their Convertible
Notes after any such reclassification, change, consolidation, merger, sale or
conveyance and any adjustment to be made with respect thereto.
SECTION 5.14. Trustee's Disclaimer. The Trustee has no duty to
--------------------
determine when an adjustment under this Article V should be made, how it should
be made or what such adjustment should be, but may accept as conclusive evidence
of the correctness of any such adjustment, and shall be protected in relying
upon the Officers' Certificate with respect thereto which the Company is
obligated to file with the Trustee pursuant to Section 5.11. The Trustee makes
no representation as to the validity or value of any securities or assets issued
upon conversion of Convertible Notes, and the Trustee shall not be responsible
for the Company's failure to comply with any provisions of this Article V.
The Trustee shall not be under any responsibility to determine the
correctness of any provisions contained in any supplemental indenture executed
pursuant to Section 5.13, but may accept as conclusive evidence of the
correctness thereof, and shall be protected in relying upon, the Officers'
Certificate with respect thereto which the Company is obligated to file with the
Trustee pursuant to Section 5.13.
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ARTICLE VI
Subordination
-------------
SECTION 6.01. Agreement to Subordinate. The Company, for itself and
------------------------
its successors, and each Noteholder, by his acceptance of Convertible Notes,
agree that the payment of the principal of or interest on or any other amounts
due on the Convertible Notes is subordinated in right of payment, to the extent
and in the manner stated in this Article VI, to the prior payment in full of all
existing and future Senior Debt.
SECTION 6.02. No Payment on Convertible Notes if Senior Debt in
-------------------------------------------------
Default. Anything in this Indenture to the contrary notwithstanding, no payment
-------
on account of principal of or redemption of, interest on or other amounts due on
the Convertible Notes (including the making of a deposit pursuant to Section
8.01), and no redemption, purchase, or other acquisition of the Convertible
Notes, shall be made by or on behalf of the Company (i) unless full payment of
amounts then due for principal and interest and of all other amounts then due on
all Senior Debt has been made or duly provided for pursuant to the terms of the
instrument governing such Senior Debt, (ii) if, at the time of such payment,
redemption, purchase or other acquisition, or immediately after giving effect
thereto, there shall exist under any Senior Debt, or any agreement pursuant to
which any Senior Debt is issued, any default, which default shall not have been
cured or waived and which default shall have resulted in the full amount of such
Senior Debt being declared due and payable or (iii) if, at the time of such
payment, redemption, purchase or other acquisition, the Trustee shall have
received written notice from the Representative of the holders of Designated
Senior Debt (a "Payment Blockage Notice") that there exists under such
Designated Senior Debt, or any agreement pursuant to which such Designated
Senior Debt is issued, any default, which default shall not have been cured or
waived, permitting the holders thereof to declare any amounts of such Designated
Senior Debt due and payable, but only for the period (the "Payment Blockage
Period") commencing on the date of receipt of the Payment Blockage Notice and
ending (unless earlier terminated by notice given to the Trustee by the
Representative of the holders of such Designated Senior Debt) on the earlier of
(a) the date on which such event of default shall have been cured or waived or
(b) 179 days from the receipt of the Payment Blockage Notice (unless the event
of default relates to the failure to pay when due, the principal, premium, if
any or interest on such Designated Senior Debt). Notwithstanding the provisions
described in the immediately preceding sentence (other than in clauses (i) and
(ii)), unless the holders of such Designated Senior Debt or the Representative
of such holders shall have accelerated the maturity of such Designated Senior
Debt (unless the event of default relates to the failure to pay when due, the
principal, premium, if any or interest on such Designated Senior Debt), the
Company may resume payments on the Convertible Notes after the end of such
Payment Blockage Period. Not more than one Payment Blockage Notice may be given
in any consecutive 360-day period, irrespective of the number of defaults with
respect to Senior Debt during such period.
In the event that, notwithstanding the provisions of this Section
6.02, payments are made by or on behalf of the Company in contravention of the
provisions of this Section 6.02, such payments shall be held by the Trustee, any
Paying Agent or the holders, as applicable, in trust for the benefit of, and
shall be paid over to and delivered to, the Representative of the holders of
Senior Debt or the trustee under the indenture or other agreement (if any),
pursuant to which any instruments evidencing any Senior Debt may have been
issued for application to the payment of all Senior Debt ratably according to
the aggregate amounts remaining unpaid to the extent necessary
-37-
to pay all Senior Debt in full in accordance with the terms of such Senior Debt,
after giving effect to any concurrent payment or distribution to or for the
holders of Senior Debt.
The Company shall give prompt written notice to the Trustee and any
Paying Agent of any event of default (after any applicable cure period has
expired) under any Senior Debt or under any agreement pursuant to which any
Senior Debt may have been issued.
SECTION 6.03. Distribution on Acceleration of Convertible Notes;
--------------------------------------------------
Dissolution and Reorganization; Subrogation of Convertible Notes.
----------------------------------------------------------------
(a) If the Convertible Notes are declared due and payable because of
the occurrence of an Event of Default, the Company shall give prompt written
notice to the holders of all Senior Debt or to the trustee(s) for such Senior
Debt of such acceleration. The Company may not pay the principal of or interest
on or any other amounts due on the Convertible Notes until five days after such
holders or trustee(s) of Senior Debt receive such notice and, thereafter, the
Company may pay the principal of or interest on or any other amounts due on the
Convertible Notes only if the provisions of this Article VI permit such payment.
(b) Upon (i) any acceleration of the principal amount due on the
Convertible Notes because of an Event of Default or (ii) any distribution of
assets of the Company upon any dissolution, winding up, liquidation or
reorganization of the Company (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors or any other
dissolution, winding up, liquidation or reorganization of the Company):
(1) the holders of all Senior Debt shall first be entitled to
receive payment in full of the principal thereof, the interest thereon and
any other amounts due thereon before the holders are entitled to receive
payment on account of the principal of or interest on or any other amounts
due on the Convertible Notes;
(2) any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities (other than
securities of the Company as reorganized or readjusted or securities of the
Company or any other corporation provided for by a plan of reorganization
or readjustment the payment of which is subordinate, at least to the extent
provided in this Article with respect to the Convertible Notes, to the
payment in full without diminution or modification by such plan of all
Senior Debt), to which the holders or the Trustee would be entitled except
for the provisions of this Article, shall be paid by the liquidating
trustee or agent or other person making such a payment or distribution,
directly to the holders of Senior Debt (or their representatives(s) or
trustee(s) acting on their behalf), ratably according to the aggregate
amounts remaining unpaid on account of the principal of or interest on and
other amounts due on the Senior Debt held or represented by each, to the
extent necessary to make payment in full of all Senior Debt remaining
unpaid, after giving effect to any concurrent payment or distribution to
the holders of such Senior Debt; and
(3) in the event that, notwithstanding the foregoing, any payment
or distribution of assets of the Company of any kind or character, whether
in cash, property or securities (other than securities of the Company as
reorganized or readjusted, or securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment the
payment of which is subordinate, at least to the extent provided in this
-38-
Article with respect to the Convertible Notes, to the payment in full
without diminution or modification by such plan of Senior Debt), shall be
received by the Trustee or the holders before all Senior Debt is paid in
full, such payment or distribution shall be held in trust for the benefit
of, and be paid over to upon request by a holder of the Senior Debt, the
holders of the Senior Debt remaining unpaid (or their representatives) or
trustee(s) acting on their behalf, ratably as aforesaid, for application to
the payment of such Senior Debt until all such Senior Debt shall have been
paid in full, after giving effect to any concurrent payment or distribution
to the holders of such Senior Debt.
Subject to the payment in full of all Senior Debt, the holders shall
be subrogated to the rights of the holders of Senior Debt to receive payments or
distributions of cash, property or securities of the Company applicable to the
Senior Debt until the principal of and interest on the Convertible Notes shall
be paid in full and, for purposes of such subrogation, no such payments or
distributions to the holders of Senior Debt of cash, property or securities
which otherwise would have been payable or distributable to holders shall, as
between the Company, its creditors other than the holders of Senior Debt, and
the holders, be deemed to be a payment by the Company to or on account of the
Senior Debt, it being understood that the provisions of this Article are and are
intended solely for the purpose of defining the relative rights of the holders,
on the one hand, and the holders of Senior Debt, on the other hand.
Nothing contained in this Article or elsewhere in this Indenture or in
the Convertible Notes is intended to or shall (i) impair, as between the Company
and its creditors other than the holders of Senior Debt, the obligation of the
Company, which is absolute and unconditional, to pay to the holders the
principal of and interest on the Convertible Notes as and when the same shall
become due and payable in accordance with the terms of the Convertible Notes,
(ii) affect the relative rights of the holders and creditors of the Company
other than holders of Senior Debt or, as between the Company and the Trustee,
the obligations of the Company to the Trustee, or (iii) prevent the Trustee or
the holders from exercising all remedies otherwise permitted by applicable law
upon default under this Indenture, subject to the rights, if any, under this
Article of the holders of Senior Debt in respect of cash, property and
securities of the Company received upon the exercise of any such remedy.
Upon distribution of assets of the Company referred to in this
Article, the Trustee, subject to the provisions of Section 9.01 hereof, and the
holders shall be entitled to rely upon a certificate of the liquidating trustee
or agent or other person making any distribution to the Trustee or to the
holders for the purpose of ascertaining the persons entitled to participate in
such distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.
The Trustee, however, shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt. Nothing contained in this Article or elsewhere in this
Indenture, or in any of the Convertible Notes, shall prevent the good faith
application by the Trustee of any moneys which were deposited with it hereunder,
prior to its receipt of written notice of facts which would prohibit such
application, for the purpose of the payment of or on account of the principal of
or interest on, the Convertible Notes unless, prior to the date on which such
application is made by the Trustee, the Trustee shall be charged with actual
notice under Section 6.03(d) hereof of the facts which would prohibit the making
of such application.
(c) The provisions of this Article shall not be applicable to any
cash, properties or securities received by the Trustee or by any holder when
received as a holder of Senior Debt and
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nothing in Section 9.11 hereof or elsewhere in this Indenture shall deprive the
Trustee or such holder of any of its rights as such holder.
(d) The Company shall give prompt written notice to the Trustee of any
fact known to the Company which would prohibit the making of any payment of
money to or by the Trustee in respect of the Convertible Notes pursuant to the
provisions of this Article. The Trustee, subject to the provisions of Section
9.01 hereof, shall be entitled to assume that no such fact exists unless the
Company or any holder of Senior Debt or any trustee therefor has given written
notice thereof to the Trustee. Notwithstanding the provisions of this Article
or any other provisions of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any fact which would prohibit the making of any
payment of moneys to or by the Trustee in respect of the Convertible Notes
pursuant to the provisions in this Article, unless, and until three Business
Days after the Trustee shall have received written notice thereof from the
Company or any holder or holders of Senior Debt or from any trustee therefor;
and, prior to the receipt of any such written notice, the Trustee, subject to
the provisions of Section 9.01 hereof, shall be entitled in all respects
conclusively to assume that no such facts exist; provided that if on a date not
--------
less than three Business Days immediately preceding the date upon which, by the
terms hereof, any such moneys may become payable for any purpose (including,
without limitation, the principal of or interest on any Convertible Note), the
Trustee shall not have received with respect to such moneys the written notice
provided for in this Section 6.03(d), then anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
receive such moneys and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary which may be
received by it on or after such prior date.
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 Debt
(or a trustee on behalf of such holder) to establish that such notice has been
given by a holder of Senior Debt (or a trustee on behalf of any such holder or
holders). In the event that the Trustee determines in good faith that further
evidence is required with respect to the right of any person as a holder of
Senior Debt to participate in any payment or distribution pursuant to this
Article, the Trustee may request such person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of Senior Debt held by
such person, the extent to which such person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
person under this Article, and, if such evidence is not furnished, the Trustee
may defer any payment to such person pending judicial determination as to the
right of such person to receive such payment; nor shall the Trustee be charged
with knowledge of the curing or waiving of any default of the character
specified in Section 6.02 hereof or that any event or any condition preventing
any payment in respect of the Convertible Notes shall have ceased to exist,
unless and until the Trustee shall have received written notice to such effect.
(e) The provisions of this Section 6.03 applicable to the Trustee
shall (unless the context requires otherwise) also apply to any Paying Agent for
the Company.
SECTION 6.04. Reliance by Senior Debt on Subordination Provisions.
---------------------------------------------------
Each holder of any Convertible Note by his acceptance thereof acknowledges and
agrees that the foregoing subordination provisions are, and are intended to be,
an inducement and a consideration for each holder of any Senior Debt, whether
such Senior Debt was created or acquired before or after the issuance of the
Convertible Notes, to acquire and continue to hold, or to continue to hold, such
Senior Debt, and such holder of Senior Debt shall be deemed conclusively to have
relied on such subordination provisions in acquiring and continuing to hold, or
in continuing to hold, such Senior
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Debt. Notice of any default in the payment of any Senior Debt, except as
expressly stated in this Article, and notice of acceptance of the provisions
hereof are hereby expressly waived. Except as otherwise expressly provided
herein, no waiver, forbearance or release by any holder of Senior Debt under
such Senior Debt or under this Article shall constitute a release of any of the
obligations or liabilities of the Trustee or holders of the Convertible Notes
provided in this Article.
SECTION 6.05. No Waiver of Subordination Provisions. Except as
-------------------------------------
otherwise expressly provided herein, no right of any present or future holder of
any Senior Debt to enforce subordination as herein provided shall at any time in
any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Company with the terms, provisions and covenants
of this Indenture, regardless of any knowledge thereof any such holder may have
or be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt may, at any time and from time to time, without the
consent of, or notice to, the Trustee or the holders of the Convertible Notes,
without incurring responsibility to the holders of the Convertible Notes and
without impairing or releasing the subordination provided in this Article VI or
the obligations hereunder of the holders of the Convertible Notes to the holders
of Senior Debt, do any one or more of the following: (i) change the manner,
place or terms of payment of, or renew or alter, Senior Debt, or otherwise amend
or supplement in any manner Senior Debt or any instrument evidencing the same or
any agreement under which Senior Debt is outstanding; (ii) sell, exchange,
release or otherwise dispose of any property pledged, mortgaged or otherwise
securing Senior Debt; (iii) release any person liable in any manner for the
collection of Senior Debt; and (iv) exercise or refrain from exercising any
rights against the Company or any other person.
SECTION 6.06. Trustee's Relation to Senior Debt. The Trustee in its
---------------------------------
individual capacity shall be entitled to all the rights set forth in this
Article in respect of any Senior Debt at any time held by it, to the same extent
as any holder of Senior Debt, and nothing in Section 9.11 hereof or elsewhere in
this Indenture shall deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations, as are
specifically set forth in this Article, and no implied covenants or obligations
with respect to the holders of Senior Debt shall be read into this Indenture
against the Trustee. The Trustee shall not owe any fiduciary duty to the
holders of Senior Debt but shall have only such obligations to such holders as
are expressly set forth in this Article.
Each holder of a Convertible Note by his acceptance thereof authorizes
and directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination provided in this Article and
appoints the Trustee his attorney-in-fact for any and all such purposes,
including, in the event of any dissolution, winding up or liquidation or
reorganization under any applicable bankruptcy law of the Company (whether in
bankruptcy, insolvency or receivership proceedings or otherwise), the timely
filing of a claim for the unpaid balance of such holder's Convertible Notes in
the form required in such proceedings and the causing of such claim to be
approved. If the Trustee does not file a claim or proof of debt in the form
required in such proceedings prior to 30 days before the expiration of the time
to file such claims or proofs, then any holder or holders of Senior Debt or
their representative or representatives shall have the right to demand, xxx for,
collect, receive and receipt for the payments and distributions in respect of
the Convertible Notes which are required to be paid or delivered to the holders
of Senior Debt as
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provided in this Article and to file and prove all claims therefor and to take
all such other action in the name of the holders or otherwise, as such holders
of Senior Debt or representative thereof may determine to be necessary or
appropriate for the enforcement of the provisions of this Article.
SECTION 6.07. Other Provisions Subject Hereto. Expect as expressly
-------------------------------
stated in this Article, notwithstanding anything contained in this Indenture to
the contrary, all the provisions of this Indenture and the Convertible Notes are
subject to the provisions of this Article. However, nothing in this Article
shall apply to or adversely affect the claims of, or payment to, the Trustee
pursuant to Section 9.07. Notwithstanding the foregoing, the failure to make a
payment on account of principal of or interest on the Convertible Notes by
reason of any provision of this Article VI shall not be construed as preventing
the occurrence of an Event of Default under Section 8.01.
ARTICLE VII
Successors
----------
SECTION 7.01. Merger, Consolidation or Sale of Assets. The Company
-------------------------------- ------
may not consolidate or merge with or into any person (whether or not the Company
is the surviving corporation), or sell, assign, transfer, lease, convey or
otherwise dispose of all or substantially all of its properties or assets
unless:
(a) the Company is the surviving corporation or the entity or the
person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, lease,
conveyance or other disposition shall have been made is a corporation
organized or existing under the laws of the United States, any state
thereof or the District of Columbia;
(b) the entity or person formed by or surviving any such
consolidation or merger (if other than the Company) assumes all the
Obligations of the Company, pursuant to a supplemental indenture in a
form reasonably satisfactory to the Trustee, under the Convertible Notes
and the Indenture;
(c) such sale, assignment, transfer, lease, conveyance or other
disposition of all or substantially all of the Company's properties or
assets shall be as an entirety or virtually as an entirety to one person
and such person shall have assumed all the Obligations of the Company,
pursuant to a supplemental indenture in a form reasonably satisfactory to
the Trustee, under the Convertible Notes and the Indenture;
(d) immediately after such transaction no Default or Event of Default
exists; and
(e) the Company or such person shall have delivered to the Trustee an
Officers', Certificate and an Opinion of Counsel, each stating that such
transaction and the supplemental indenture comply with the Indenture and
that all conditions precedent in the Indenture relating to such transaction
have been satisfied.
SECTION 7.02. Successor Corporation Substituted. Upon any
---------------------------------
consolidation or merger, or any sale, assignment, transfer, lease, conveyance or
other disposition of all or substantially all of the assets of the Company in
accordance with Section 7.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company is merged or to which
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such sale, assignment, transfer, lease, conveyance or other disposition is made
shall succeed to, and be substituted for and may exercise every right and power
of, the Company under this Indenture with the same effect as if such successor
person has been named as the Company herein; provided, however, that the
-------- --------
predecessor Company in the case of a sale, assignment, transfer, lease,
conveyance or other disposition shall not be released from the obligation to pay
the principal of and interest on the Convertible Notes.
ARTICLE VIII
Defaults and Remedies
---------------------
SECTION 8.01. Events of Default. An "Event of Default" occurs if:
-----------------
(a) the Company defaults in the payment of interest on any Convertible
Note when the same becomes due and payable, whether or not such payments
shall be prohibited by Article VI, and the Default continues for a period
of 30 days after the date due and payable;
(b) the Company defaults in the payment of the principal of any
Convertible Note when the same becomes due and payable at maturity, upon
redemption or otherwise, whether or not such payment shall be prohibited by
Article VI;
(c) the Company fails to observe or perform any covenant or agreement
contained in Section 4.07 hereof, whether or not such purchase shall be
prohibited by Article VI;
(d) the Company fails to observe or perform any other covenant or
agreement contained in this Indenture or the Convertible Notes, required by
it to be performed and the Default continues for a period of 60 days after
the receipt of written notice from the Trustee to the Company or from the
holders of 25% in aggregate principal amount of the then outstanding
Convertible Notes to the Company and the Trustee stating that such notice
is a "Notice of Default";
(e) there is a default under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or
evidenced any Indebtedness for money borrowed by the Company or any
Material Subsidiary of the Company (or the payment of which is guaranteed
by the Company or any Material Subsidiary of the Company), whether such
Indebtedness or guarantee now exists or is created after the Issuance Date,
which default (i) is caused by a failure to pay when due principal of or
interest on such Indebtedness within the grace period provided for in such
Indebtedness (which failure continues beyond any applicable grace period)
(a "Payment Default") or (ii) results in the acceleration of such
Indebtedness prior to its express maturity and, in each case, the principal
amount of any such Indebtedness, together with the principal amount of any
other such Indebtedness under which there is a Payment Default or the
maturity of which has been so accelerated, aggregates $5,000,000 or more;
(f) a final, non-appealable judgment or final, non-appealable
judgments (other than any judgment as to which a reputable insurance
company has accepted full liability) for the payment of money are entered
by a court or courts of competent jurisdiction against the
-43-
Company or any Material Subsidiary of the Company and remain undischarged
for a (during which execution shall not be effectively stayed) of 60 days,
provided that the aggregate of all such judgments exceeds $5,000,000;
(g) the Company or any Material Subsidiary pursuant to or within the
meaning of any Bankruptcy Law: (i) commences a voluntary case, (ii)
consents to the entry of an order for relief against it in an involuntary
case in which it is the debtor, (iii) consents to the appointment of a
Custodian of it or for all or substantially all of its property, (iv) makes
a general assignment for the benefit of its creditors, or (v) makes the
admission in writing that it generally is unable to pay its debts as the
same become due; or
(h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that: (i) is for relief against the Company or any
Material Subsidiary of the Company in an involuntary case, (ii) appoints a
Custodian of the Company or any Material Subsidiary of the Company or for
all or substantially all of its property, and the order or decree remains
unstayed and in effect for 60 days, or (iii) orders the liquidation of the
Company or any Material Subsidiary of the Company, and the order or decree
remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal or state law for the relief of debtors. The term "Custodian" means any
receiver, trustee, assignee, liquidator or similar official under any Bankruptcy
Law.
SECTION 8.02. Acceleration. If an Event of Default (other than an
------------
Event of Default specified in clauses (g) and (h) of Section 8.01 hereof) occurs
and is continuing, the Trustee by written notice to the Company, or the
Noteholders of at least 25% in principal amount of the then outstanding
Convertible Notes by notice to the Company and the Trustee, may declare all the
Convertible Notes to be due and payable. Upon such declaration, the principal
of, premium, if any, and accrued and unpaid interest on the Convertible Notes
shall be due and payable immediately. If an Event of Default specified in
clause (g) or (h) of Section 8.01 hereof occurs, such an amount shall ipso facto
---- -----
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Noteholder. The Noteholders of a majority in
aggregate principal amount of the then outstanding Convertible Notes by written
notice to the Trustee 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 principal or
interest that has become due solely because of the acceleration.
SECTION 8.03. Other Remedies. If an Event of Default occurs and is
--------------
continuing, the Trustee may pursue any available remedy to collect the payment
of principal or interest on the Convertible Notes or to enforce the performance
of any provision of the Convertible Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Convertible Notes or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Noteholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
-44-
SECTION 8.04. Waiver of Past Defaults. The Noteholders of a majority
-----------------------
in aggregate principal amount of the then outstanding Convertible Notes by
notice to the Trustee may waive an existing Default or Event of Default and its
consequences except a continuing Default or Event of Default in the payment of
the Designated Event Payment or the principal of, or interest on, any
Convertible Note. When a Default or Event of Default is waived, it is cured and
ceases; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
SECTION 8.05. Control by Majority. The Noteholders of a majority in
-------------------
principal amount of the then outstanding Convertible Notes may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on it. However, the Trustee
may refuse to follow any direction that conflicts with law or this Indenture, is
unduly prejudicial to the rights of other Noteholders, or would involve the
Trustee in personal liability.
SECTION 8.06. Limitation on Suits. A Noteholder may pursue a remedy
-------------------
with respect to this Indenture or the Convertible Notes only if:
(a) the Noteholder gives to the Trustee written notice of a continuing
Event of Default;
(b) the Noteholders of at least 25% in principal amount of the then
outstanding Convertible Notes make a request to the Trustee to pursue the
remedy;
(c) such Noteholder or Noteholders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(e) during such 60-day period the Noteholders of a majority in
principal amount of the then outstanding Convertible Notes do not give the
Trustee a direction inconsistent with the request.
A Noteholder may not use this Indenture to prejudice the rights of
another Noteholder or to obtain a preference or priority over another
Noteholder.
SECTION 8.07. Rights of Noteholders to Receive Payment.
----------------------------------------
Notwithstanding any other provision of this Indenture, the right of any
Noteholder of a Convertible Note to receive payment of principal and interest on
the Convertible Note, on or after the respective due dates expressed in the
Convertible Note, or to bring suit for the enforcement of any such payment on or
after such respective dates, shall not be impaired or affected without the
consent of the Noteholder made pursuant to this Section.
SECTION 8.08. Collection Suit by Trustee. If an Event of Default
--------------------------
specified in Section 8.01(a) or (b) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount of principal and interest remaining unpaid on the
Convertible Notes and interest on overdue principal and interest and such
further amount as shall be sufficient to cover the costs and, to the extent
lawful, expenses of
-45-
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
SECTION 8.09. Trustee May File Proofs of Claim. The Trustee may file
--------------------------------
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Noteholders allowed
in any judicial proceedings relative to the Company, its creditors or its
property. Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Noteholder any plan
of reorganization, arrangement, adjustment or composition affecting the
Convertible Notes or the rights of any Noteholder thereof, or to authorize the
Trustee to vote in respect of the claim of any Noteholder in any such
proceeding.
SECTION 8.10. Priorities. If the Trustee collects any money pursuant
----------
to this Article, it shall pay out the money in the following order:
First: to the Trustee for amounts due under Section 9.07 hereof;
-----
Second: to the holders of Senior Debt to the extent required by
------
Article VI;
Third: to Noteholders for amounts due and unpaid on the Convertible
-----
Notes for principal and interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Convertible
Notes for principal and interest, respectively; and
Fourth: to the Company.
------
Except as otherwise provided in Section 2.12 hereof, the Trustee may
fix a record date and payment date for any payment to Noteholders made pursuant
to this Section.
SECTION 8.11. Undertaking for Costs. In any suit for the enforcement
---------------------
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as a Trustee, a court in its discretion
may require the filing by any party litigant in the suit of an undertaking to
pay the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a holder pursuant to Section 8.07 hereof, or a suit by
Noteholders of more than 10% in principal amount of the then outstanding
Convertible Notes.
ARTICLE IX
Trustee
-------
SECTION 9.01. Duties of Trustee. (a) If an Event of Default has
-----------------
occurred and is continuing, the Trustee shall exercise such of the rights and
powers vested in it by this Indenture, and use the same degree of care and skill
in their exercise, as a prudent man would exercise or use under the
circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default: (i) the
Trustee need perform only those duties that are specifically set forth in this
Indenture and no others and (ii) in the
-46-
absence of bad faith on its part, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed therein,
upon certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own wilful
misconduct, except that: (i) this paragraph does not limit the effect of
paragraph (b) of this Section 9.01; (ii) the Trustee shall not be liable for any
error of judgment made in good faith by a Trust Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts and (iii) 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
8.05 hereof.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section 9.01. No
provision of this Indenture shall require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not reasonably assured to
it.
(e) The Trustee may refuse to perform any duty or exercise any right
or power unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held
in trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 9.02. Rights of Trustee. (a) The Trustee may rely on any
-----------------
document reasonably believed by it to be genuine and to have been signed or
presented by the proper person. The Trustee need not investigate any fact or
matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it (unless other
evidence be herein specifically prescribed) may require an Officers' Certificate
or an Opinion of Counsel, or both. The Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on such Officers'
Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and nominees and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
(d) The Trustee shall not be liable for any action that it takes or
omits to take in good faith, without negligence or wilful misconduct, and that
it reasonably believes to be authorized or within its rights or powers.
(e) The Trustee shall not be charged with knowledge of any Event of
Default under subsection (c), (d), (e) or (f) of Section 8.01 or of the identity
of any Material Subsidiary unless either (1) a Trust Officer assigned to its
Institutional Trust Administration shall have actual knowledge thereof, or (2)
the Trustee shall have received notice thereof in accordance with Section 12.02
hereof from the Company or any holder.
-47-
SECTION 9.03. Individual Rights of Trustee. The Trustee in its
----------------------------
individual or any other capacity may become the owner or pledgee of Convertible
Notes and may otherwise deal with the Company or an Affiliate with the same
rights it would have if it were not Trustee. Any Agent may do the same with
like rights. However, the Trustee is subject to Sections 9.10 and 9.11 hereof.
SECTION 9.04. Trustee's Disclaimer. The Trustee makes no
--------------------
representation as to the validity or adequacy of this Indenture or the
Convertible Notes, it shall not be accountable for the Company's use of the
proceeds from any Convertible Notes authenticated and delivered by the Trustee
in conformity with the provisions of this Indenture, and it shall not be
responsible for any statement of the Company in the Indenture or any statement
in the Convertible Notes other than its authentication.
SECTION 9.05. Notice of Defaults. If a Default or Event of Default
------------------
occurs and is continuing and if it is actually known to the Trustee, the Trustee
shall mail to Noteholders a notice of the Default or Event of Default within 90
days after it occurs. Except in the case of a Default or Event of Default in
payment on any Convertible Note, the Trustee may withhold the notice if and so
long as a committee of its Trust Officers in good faith determines that
withholding the notice is in the interests of Noteholders.
SECTION 9.06. Reports by Trustee to Noteholders. Within 60 days after
---------------------------------
the reporting date stated in Section 12.10, the Trustee shall mail to
Noteholders a brief report dated as of such reporting date that complies with
TIA (S) 313(a) if and to the extent required by such (S) 313(a). The Trustee
also shall comply with TIA (S) 313(b)(2). The Trustee shall also transmit by
mail all reports as required by TIA (S) 313(c).
A copy of each report at the time of its mailing to Noteholders shall
be filed with the SEC and each stock exchange on which the Convertible Notes are
listed. The Company shall notify the Trustee when the Convertible Notes are
listed on any stock exchange.
SECTION 9.07. Compensation and Indemnity. The Company shall pay to
--------------------------
the Trustee from time to time reasonable compensation for its services
hereunder. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Company shall reimburse the
Trustee upon request for all reasonable and duly documented disbursements,
expenses and advances incurred or made by it including amounts payable to the
Paying Agent pursuant to the second paragraph of Section 4.01 hereunder. Such
disbursements and expenses may include the reasonable and duly documented
disbursements, compensation and expenses of the Trustee's agents and counsel but
shall not include amounts to be paid to any co-agents appointed by the Company.
The Company shall indemnify the Trustee and its officers, directors,
employees and all other agents against any loss or liability incurred by it
except as set forth in the next paragraph. The Trustee shall notify the Company
promptly of any claim for which it may seek indemnity. The Company shall defend
the claim and the Trustee shall cooperate in the defense. The Trustee may have
separate counsel and the Company shall pay the reasonable and duly documented
fees, disbursements and expenses of such counsel. The Company need not pay for
any settlement made without its consent, which consent shall not be unreasonably
withheld.
The Company need not reimburse any expense or indemnify against any
loss or liability incurred by the Trustee through negligence or bad faith.
-48-
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Convertible Notes on all money or
property held or collected by the Trustee, except money or property held in
trust to pay principal and interest on particular Convertible Notes.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 8.01(g) or (h) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
The provisions of this Section 9.07 shall survive the termination of
this Indenture, and removal or resignation of the Trustee, as provided by
Section 10.01 hereof.
SECTION 9.08. Replacement of Trustee. A resignation or removal of the
----------------------
Trustee and appointment of a Successor Trustee shall become effective only upon
the successor Trustee's acceptance of appointment as provided in this Section.
The Trustee may resign by so notifying the Company. The Noteholders
of a majority in principal amount of the then outstanding Convertible Notes may
remove the Trustee by so notifying the Trustee and the Company. The Company may
remove the Trustee if:
(a) the Trustee fails to comply with Section 9.10 hereof, unless the
Trustee's duty to resign is stayed as provided in TIA (S) 310(b);
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the
Noteholders of a majority in principal amount of the then outstanding
Convertible Notes may appoint a successor Trustee to replace the successor
Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Noteholders of at least 10% in principal amount of the then outstanding
Convertible Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 9.10 hereof, unless the
Trustee's duty to resign is stayed as provided in TIA (S) 310(b), any Noteholder
who has been a bona fide holder of a Convertible Note for at least six months
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, the
Company shall promptly pay all amounts due and payable to the retiring Trustee
pursuant to Section 9.07 hereof and the successor Trustee shall have all the
rights, powers
-49-
and duties of the Trustee under this Indenture. The successor Trustee shall mail
a notice of its succession to Noteholders. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, subject to
the lien provided for in Section 9.07 hereof. Notwithstanding replacement of the
Trustee pursuant to this Section 9.08, the Company's obligations under Section
9.07 hereof shall continue for the benefit of the retiring trustee with respect
to expenses and liabilities incurred by it prior to such replacement.
SECTION 9.09. Successor Trustee by Merger, Etc. If the Trustee
--------------------------------
consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation, the successor corporation
without any further act shall be the successor Trustee.
SECTION 9.10. Eligibility; Disqualification. This Indenture shall
-----------------------------
always have a Trustee who satisfies the requirements of TIA (S) 310(a)(1) and
(5). The Trustee shall always have a combined capital and surplus as stated in
Section 12.10 hereof. The Trustee is subject to TIA (S) 310(b).
SECTION 9.11. Preferential Collection of Claims Against Company. The
-------------------------------------------------
Trustee is subject to TIA (S) 311(a), excluding any creditor relationship listed
in TIA (S) 311(b). A Trustee who has resigned or been removed shall be subject
to TIA (S) 311(a) to the extent indicated therein.
SECTION 9.12. Sections Applicable to Registrar, Paying Agent and
--------------------------------------------------
Conversion Agent. The term "Trustee" as used in Sections 9.01, 9.02, 9.03, 9.04
-----------------
and 9.07 hereof shall (unless the context requires otherwise) be construed as
extending to and including the Trustee acting in its capacity, if any, as
Registrar, Paying Agent and Conversion Agent.
ARTICLE X
Discharge of Indenture
----------------------
SECTION 10.01. Termination of Company's Obligations. This Indenture
------------------------------------
shall cease to be of further effect (except that the Company's obligations under
Sections 9.07 and 10.02 hereof shall survive) when all outstanding Convertible
Notes theretofore authenticated and issued have been delivered to the Trustee
for cancellation and the Company has paid all sums payable hereunder.
Thereupon, the Trustee upon written request of the Company, shall
acknowledge in writing the discharge of the Company's obligations under this
Indenture, except for those surviving obligations specified above.
SECTION 10.02. Repayment to Company. The Trustee and the Paying Agent
--------------------
shall promptly pay to the Company upon written request any excess money or
securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon written
request any money held by them for the payment of principal or interest that
remains unclaimed for two years after the date upon which such payment shall
have become due; provided, however, that the Company shall have first caused
-------- -------
notice of such payment to the Company of such unclaimed money to be mailed to
each Noteholder entitled thereto no less than 30 days prior to such payment.
After payment to the Company, the Trustee and the Paying Agent shall have no
further liability with
-50-
respect to such money and Noteholders entitled to the money must look to the
Company for payment as general creditors unless any applicable abandoned
property law designates another person.
ARTICLE XI
Amendments, Supplements and Waivers
-----------------------------------
SECTION 11.01. Without Consent of Noteholders. The Company and the
------------------------------
Trustee may amend or supplement this Indenture or the Convertible Notes without
the consent of any Noteholder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to comply with Sections 5.13 and 7.01 hereof;
(c) to provide for uncertificated Convertible Notes in addition to
certificated Convertible Notes;
(d) to make any change that does not adversely affect the legal rights
hereunder of any Noteholder;
(e) to qualify this Indenture under the TIA or to comply with the
requirements of the SEC in order to maintain the qualification of the
Indenture under the TIA; or
(f) to make any change that provides any additional rights or benefits
to the holders of Convertible Notes or to reduce the Conversion Price.
An amendment under this Section may not make any change that adversely
affects the rights under Article VI of any holder of Senior Debt then
outstanding unless the holders of such Senior Debt (or any group or
representative thereof authorized to give a consent) consent to such change.
SECTION 11.02. With Consent of Noteholders. Subject to Section 8.07
---------------------------
hereof, the Company and the Trustee may amend or supplement this Indenture or
the Convertible Notes with the written consent (including consents obtained in
connection with any tender offer or exchange offer for Convertible Notes) of the
Noteholders of at least a majority in principal amount of the then outstanding
Convertible Notes. Subject to Sections 8.04 and 8.07 hereof, the Noteholders of
a majority in principal amount of the Convertible Notes then outstanding may
also by their written consent (including consents obtained in connection with
any tender offer or exchange offer for Convertible Notes) waive any existing
Default as provided in Section 8.04 or waive compliance in a particular instance
by the Company with any provision of this Indenture or the Convertible Notes.
However, without the consent of each Noteholder affected, an amendment,
supplement or waiver under this Section may not (with respect to any Convertible
Notes held by a nonconsenting Noteholder):
(a) reduce the amount of Convertible Notes whose Noteholders must
consent to an amendment, supplement or waiver;
-51-
(b) reduce the rate of or change the time for payment of interest on
any Convertible Note;
(c) reduce the principal of or change the fixed maturity of any
Convertible Note or alter the redemption provisions with respect thereto;
(d) make any Convertible Note payable in money other than that stated
in the Convertible Note;
(e) make any change in Section 8.04, 8.07 or 11.02 hereof (this
sentence);
(f) waive a default in the payment of the Designated Event Payment or
the principal of, or interest on, any Convertible Note (other than as
provided in Section 8.04);
(g) waive a redemption payment payable on any Convertible Note;
(h) make any change that adversely affects the right of Noteholders to
convert Convertible Notes into Common Stock of the Company; or
(i) make any change in Articles V or VI hereof that adversely affects
the interests of the Noteholders.
To secure a consent of the Noteholders under this Section 11.02, it
shall not be necessary for the Noteholders to approve the particular form of any
proposed amendment, supplement or waiver, but it shall be sufficient if such
consent approves the substance thereof.
An amendment under this Section may not make any change that adversely
affects the rights under Article VI of any holder of Senior Debt then
outstanding unless the holders of such Senior Debt (or any group or
representative thereof authorized to give a consent) consent to such change.
Neither the Company nor any of its Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any holder of Convertible Notes or as an
inducement to any consent, waiver or amendment of any of the terms or provisions
of this Indenture or the Convertible Notes unless such consideration is offered
to be paid or agreed to be paid to all holders of the Convertible Notes that
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to Noteholders a notice briefly describing the
amendment or waiver.
SECTION 11.03. Compliance with Trust Indenture Act. Every amendment
-----------------------------------
to this Indenture or the Convertible Notes shall be set forth in a supplemental
indenture that complies with the TIA as then in effect.
SECTION 11.04. Revocation and Effect of Consents. Until an amendment,
---------------------------------
supplement or waiver becomes effective, a consent to it by a Noteholder of a
Convertible Note is a continuing consent by the Noteholder and every subsequent
Noteholder of a Convertible Note or
-52-
portion of a Convertible Note that evidences the same debt as the consenting
Noteholder's Convertible Note, even if notation of the consent is not made on
any Convertible Note. However, any such Noteholder or subsequent Noteholder may
revoke the consent as to such Noteholder's Convertible Note or portion of a
Convertible Note if the Trustee receives the notice of revocation before the
date on which the Trustee receives an Officer's Certificate certifying that the
Noteholders of the requisite principal amount of Convertible Notes have
consented to the amendment, supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Noteholders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those persons who were
Noteholders at such record date (or their duly designated proxies), and only
those persons, shall be entitled to consent to such amendment, supplement or
waiver or to revoke any consent previously given, whether or not such persons
continue to be Noteholders after such record date. No consent shall be valid or
effective for more than 90 days after such record date unless consents from
Noteholders of the principal amount of Convertible Notes required hereunder for
such amendment or waiver to be effective shall have also been given and not
revoked within such 90-day period.
After an amendment, supplement or waiver becomes effective it shall
bind every Noteholder, unless it is of the type described in any of clauses (a)
through (i) of Section 11.02 hereof. In such case, the amendment or waiver shall
bind each Noteholder who has consented to it and every subsequent Noteholder
that evidences the same debt as the consenting Noteholder's Convertible Note.
SECTION 11.05. Notation on or Exchange of Convertible Notes. The
--------------------------------------------
Trustee may place an appropriate notation about an amendment or waiver on any
Convertible Note thereafter authenticated. The Company in exchange for all
Convertible Notes may issue and the Trustee shall authenticate new Convertible
Notes that reflect the amendment or waiver.
SECTION 11.06. Trustee Protected. The Trustee shall sign all
-----------------
supplemental indentures, except that the Trustee may, but need not, sign any
supplemental indenture that adversely affects its rights.
ARTICLE XII
Miscellaneous
-------------
SECTION 12.01. Trust Indenture Act Controls. If any provision of this
----------------------------
Indenture limits, qualifies, or conflicts with another provision which is
automatically deemed to be incorporated in this Indenture by the TIA, the
incorporated provision shall control.
SECTION 12.02. Notices. Any notice or communication by the Company or
-------
the Trustee to the other is duly given if in writing and delivered in person or
mailed by first-class mail to the other's address stated in Section 12.10
hereof. The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
-53-
Any notice or communication to a Noteholder shall be mailed by first-
class mail to his address shown on the register kept by the Registrar. Failure
to mail a notice or communication to a Noteholder or any defect in it shall not
affect its sufficiency with respect to other Noteholders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to Noteholders, it
shall mail a copy to the Trustee and each Agent at the same time.
All other notices or communications shall be in writing.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice as required
by the Indenture, then such method of notification as shall be made with the
approval of the Trustee shall constitute a sufficient mailing of such notice.
SECTION 12.03. Communication by Noteholders with Other Noteholders.
---------------------------------------------------
Noteholders may communicate pursuant to TIA (S) 312(b) with other Noteholders
with respect to their rights under this Indenture or the Convertible Notes. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA (S) 312(c).
SECTION 12.04. 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:
(a) 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
(b) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 12.05. Statements Required in Certificate or Opinion. Each
---------------------------------------------
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than pursuant to Section 4.03) shall
include:
(a) a statement that the person signing such certificate or rendering
such opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such person, such person 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
-54-
(d) a statement as to whether or not, in the opinion of such person,
such condition or covenant has been complied with.
SECTION 12.06. Rules by Trustee and Agents. The Trustee may make
---------------------------
reasonable rules for action by, or a meeting of, Noteholders. The Registrar or
Paying Agent may make reasonable rules and set reasonable requirements for its
functions.
SECTION 12.07. Legal Holidays. A "Legal Holiday" is a Saturday, a
--------------
Sunday or a day on which banking institutions in the State of New York are not
required to be open. If a payment date is a Legal Holiday at a place of
payment, payment may be made at that place on the next succeeding day that is
not a Legal Holiday, and no interest shall accrue for the intervening period.
If any other operative date for purposes of this Indenture shall occur on a
Legal Holiday then for all purposes the next succeeding day that is not a Legal
Holiday shall be such operative date.
SECTION 12.08. No Recourse Against Others. A director, officer,
--------------------------
employee or shareholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Convertible Notes or the Indenture
or for any claim based on, in respect of or by reason of such obligations or
their creation. Each Noteholder by accepting a Convertible Note waives and
releases all such liability. The waiver and release are part of the
consideration for the issue of the Convertible Notes.
SECTION 12.09. Counterparts. This Indenture may be executed in any
------------
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
SECTION 12.10. Variable Provisions. "Officer" means the Chairman, the
-------------------
President, any Vice-President, the Treasurer, the Secretary, any Assistant
Treasurer or any Assistant Secretary of the Company.
The Company initially appoints the Trustee as Paying Agent, Registrar,
Conversion Agent and authenticating agent and the Trustee hereby accepts such
appointments.
The first certificate pursuant to Section 4.03 hereof shall be for the
fiscal year ending on December 31, 1996.
The reporting date for Section 9.06 hereof is May 1 of each year. The
first reporting date is May 1, 1997.
The Trustee shall always have a combined capital and surplus of at
least $100,000,000 as set forth in its most recent published annual report of
condition.
The Company's address is: Stillwater Mining Company
XX 00
Xxx 000
Xxx, Xxxxxxx 00000
Telephone number: (000) 000-0000
Telefax number: (000) 000-0000
-55-
The Trustee's address is: Colorado National Bank
000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone number: (000) 000-0000
Telefax number: (000) 000-0000
SECTION 12.11. GOVERNING LAW. THE INTERNAL LAWS OF THE STATE OF NEW
-------------
YORK SHALL GOVERN THIS INDENTURE AND THE SECURITIES, WITHOUT REGARD TO THE
CONFLICT OF LAWS PROVISIONS THEREOF.
SECTION 12.12. No Adverse Interpretation of Other Agreements. This
---------------------------------------------
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or an Affiliate. Any such indenture, loan or debt agreement may
not be used to interpret this Indenture.
SECTION 12.13. Successors. All agreements of the Company in this
----------
Indenture and the Convertible Notes shall bind its successor. All agreements of
the Trustee in this Indenture shall bind its successor.
SECTION 12.14. Severability. In case any provision in this Indenture
------------
or in the Convertible Notes 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 12.15. Table of Contents, Headings, Etc. The Table of
--------------------------------
Contents, Cross-Reference Table, and headings of the Articles and Sections of
this Indenture have been inserted for convenience of reference only, are not to
be considered a part hereof, and shall in no way modify or restrict any of the
terms or provisions hereof.
[signature page follows]
-56-
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, all as of the date first written above.
STILLWATER MINING COMPANY
By: /s/ XXXXXXX X. XXXXXX
--------------------------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Chairman and Chief Executive Officer
--------------------------------------
COLORADO NATIONAL BANK,
as Trustee
By: /s/ XXXXXXXX X. XXXXXX
--------------------------------------------
Name: Xxxxxxxx X. Xxxxxx
---------------------------------------
Title: Trust Officer
--------------------------------------
-57-
STATE OF COLORADO )
) ss.:
COUNTY OF DENVER )
Personally appeared before me, the undersigned authority in and for
the said county and state, on this 29th day of April, within my jurisdiction,
the within named Xxxxxxx X. Xxxxxx who acknowledged that he is Chairman and
Chief Executive Officer of Stillwater Mining Company, a Delaware corporation,
and that for and on behalf of the said corporation, and as its act and deed he
executed the above and foregoing instrument, after first having been duly
authorized by said corporation so to do.
/s/ XXXX X. XXXXXXXXX
--------------------------------
NOTARY PUBLIC
My Commission Expires: February 1, 1997.
-00-
XXXXX XX XXXXXXXX )
) ss.:
COUNTY OF DENVER )
Personally appeared before me, the undersigned authority in and for
the said county and state, on this 29th day of April, within my
jurisdiction, the within named Xxxxxxxx X. Xxxxxx who acknowledged that
he/she is Trust Officer of Colorado National Bank, a national banking
association, and that for and on behalf of the said corporation, and as its act
and deed he/she executed the above and foregoing instrument, after first haying
duly authorized by said corporation so to do.
/s/ XXXXXX X. XXXX
-----------------------------
NOTARY PUBLIC
My Commission Expires: February 15, 1997
-59-
EXHIBIT A-1
[FORM OF FACE OF NOTE]
[Global Notes Legend]/1/
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC 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 THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Convertible Notes Legend]/2/
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE THIRD ANNIVERSARY OF
THE ISSUANCE HEREOF (OR ANY PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER
THAT WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS
PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE
COMPANY, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED
BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), (3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER
THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), AND, IF SUCH TRANSFER
IS BEING EFFECTED BY CERTAIN TRANSFERORS SPECIFIED IN THE INDENTURE (AS DEFINED
BELOW) PRIOR TO THE EXPIRATION OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE
MEANING OF RULE 903(c)(3) OF REGULATION S UNDER THE SECURITIES ACT), A
CERTIFICATE WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRUSTEE IS DELIVERED
BY THE TRANSFEREE TO THE COMPANY AND THE TRUSTEE, (4) TO AN INSTITUTION THAT IS
AN "ACCREDITED INVESTOR"
AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING THIS
SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND A CERTIFICATE IN
THE FORM ATTACHED TO THIS SECURITY IS DELIVERED BY THE TRANSFEREE TO THE COMPANY
AND THE TRUSTEE (PROVIDED THAT CERTAIN HOLDERS SPECIFIED IN THE INDENTURE MAY
NOT TRANSFER THIS SECURITY PURSUANT TO THIS CLAUSE (4) PRIOR TO THE EXPIRATION
OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE 903(c)(3) OF
REGULATION S UNDER THE SECURITIES ACT), (5) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER
THE SECURITIES ACT, OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES. AN INSTITUTIONAL ACCREDITED INVESTOR
HOLDING THIS SECURITY AGREES THAT IT WILL FURNISH TO THE COMPANY AND THE TRUSTEE
SUCH CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE TO
CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING
RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND
AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A OR (2) AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY FOR
INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) A NON-U.S. PERSON OUTSIDE
THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE
REQUIREMENTS OF PARAGRAPH (o)(2) OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT."
-------------------------------
/1/ Applicable to Global Notes only
/2/ Applicable to certificated Restricted Convertible Notes only
A1-2
No. ________
CUSIP No. ________
STILLWATER MINING COMPANY
7% CONVERTIBLE SUBORDINATED NOTES
DUE 2003
STILLWATER MINING COMPANY
Stillwater Mining Company, a Delaware corporation (the "Company") promises
to pay to
_________________________________________________________________ or registered
assigns, the principal sum [indicated on Schedule A hereof]* [of _________
Dollars]** on May 1, 2003, and to pay interest thereon beginning November 1,
1996 at the rate of 7% per annum.
Interest Payment Dates: May 1 and November 1,
commencing November 1, 1996
Record Dates: April 15 and October 15
Reference is hereby made to the further provisions of this Convertible
Note set forth on the reverse hereof which further provisions shall for all
purposes have the same effect as if set forth at this place
------------------------
/*/ Applicable to Global Notes only.
/**/ Applicable to certificated Convertible Notes only.
A1-3
IN WITNESS WHEREOF, Stillwater Mining Company has caused this
Convertible Note to be signed manually or by facsimile by its duly authorized
officers and a facsimile of its corporate seal to be affixed hereto or imprinted
hereon.
Dated: _________________
STILLWATER MINING COMPANY
By
-------------------------------------
By
-------------------------------------
[Seal]
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
This is one of the 7%
Convertible Subordinated Notes
due 2003 described in the
within-mentioned Indenture.
COLORADO NATIONAL BANK,
as Trustee
By
----------------------------
Authorized Officer
A1-4
STILLWATER MINING COMPANY
7% Convertible Subordinated Note Due 2003
1. Interest. STILLWATER MINING COMPANY, a Delaware corporation (the
--------
"Company"), is the issuer of this 7% Convertible Subordinated Note Due 2003 (the
"Convertible Note"). The Company promises to pay interest on the Convertible
Notes in cash semiannually on each May 1 and November 1, commencing on November
1, 1996, to holders of record on the immediately preceding April 15 and October
15.
Interest on the Convertible Notes will accrue from the most recent
date to which interest has been paid, or if no interest has been paid, from
April 29, 1996. Interest will be computed on the basis of a 360-day year of
twelve 30-day months. To the extent lawful, the Company shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest (without regard to any applicable grace period)
at the rate borne by the Convertible Notes, compounded annually.
2. Method of Payment. The Company will pay interest on the
-----------------
Convertible Notes (except defaulted interest) to the persons who are registered
holders of the Convertible Notes at the close of business on the record date for
the next interest payment date even though Convertible Notes are canceled after
the record date and on or before the interest payment date. The Noteholder
hereof must surrender Convertible Notes to a Paying Agent to collect principal
payments. The Company will pay principal and interest in money of the United
States that at the time of payment is legal tender for payment of public and
private debts. However, the Company may pay principal and interest by check
payable in such money. It may mail by first class mail an interest check to a
holder's registered address.
3. Paying Agent and Registrar. The Trustee will initially act as
--------------------------
Paying Agent, Registrar and Conversion Agent. The Company may change any Paying
Agent, Registrar, co-registrar or Conversion Agent without prior notice. The
Company or any of its Affiliates may act in any such capacity.
4. Indenture. The Company issued the Convertible Notes under an
---------
indenture, dated as of April 29, 1996 (the "Indenture"), between the Company and
Colorado National Bank, as Trustee. The terms of the Convertible Notes include
those stated in the Indenture and those made part of the Indenture by the Trust
Indenture Act of 1939 (15 U.S. Code (S)(S)77aaa-77bbbb) as in effect on the date
of the Indenture. The Convertible Notes are subject to, and qualified by, all
such terms, certain of which are summarized hereon, and Noteholders are referred
to the Indenture and such Act for a statement of such terms. The Convertible
Notes are unsecured obligations of the Company limited to (except as otherwise
provided in the Indenture) up to an aggregate principal amount of $50,000,000
(plus up to $7,500,000 aggregate principal amount of Convertible Notes that may
be sold by the Company pursuant to the over allotment option granted pursuant to
the Purchase Agreement), and are subordinated in right of payment to all
existing and future Senior Debt of the Company as provided in the Indenture.
Any holder of this Convertible Note shall be deemed to have agreed to and be
bound by all the terms and conditions contained in the Indenture applicable to a
holder of a Convertible Note.
A1-5
5. Optional Redemption. The Convertible Notes are not subject to
-------------------
redemption at the Company's option prior to May 1, 1999. On such date and
thereafter, the Convertible Notes will be subject to redemption at the option of
the Company, in whole or in part (in any integral multiple of $1,000), upon not
less than 20 nor more than 60 days' prior notice by first class mail at the
following redemption prices (expressed as percentages of the principal amount
set forth below), together with accrued interest up to but not including the
redemption date (subject to the right of holders of record on the relevant
record date to receive interest due on an interest payment date), if redeemed
during the 12-month period beginning May 1 of the years indicated:
Redemption
Year Price
---- -----------------
1999.................................... 104%
2000.................................... 103%
2001.................................... 102%
2002.................................... 101%
and 100% at May 1, 2003. On or after the redemption date, interest will cease
to accrue on the Convertible Notes, or portion thereof, called for redemption.
6. Notice of Redemption. Notice of redemption will be mailed by
--------------------
first class mail at least 20 days but not more than 60 days before the
redemption date to each holder of the Convertible Notes to be redeemed at his
address of record. The Convertible Notes in denominations larger than $1,000
may be redeemed in part but only in integral multiples of $1,000. In the event
of a redemption of less than all of the Convertible Notes, the Convertible Notes
will be chosen for redemption by the Trustee in accordance with the Indenture.
Unless the Company defaults in making such redemption payment, or the Paying
Agent is prohibited from making such payment pursuant to the Indenture, interest
ceases to accrue on the Convertible Notes or portions of them called for
redemption on and after the redemption date.
If this Convertible Note is redeemed subsequent to a record date with
respect to any interest payment date specified above and on or prior to such
interest payment date, then any accrued interest will be paid to the person in
whose name this Convertible Note is registered at the close of business on such
record date.
7. Mandatory Redemption. The Company will not be required to make
--------------------
mandatory redemption payments with respect to the Convertible Notes. There are
no sinking fund payments with respect to the Convertible Notes.
8. Repurchase at Option of Holder. If there is a Designated Event,
------------------------------
the Company shall be required to offer to purchase on the Designated Event
Payment Date all outstanding Convertible Notes at a purchase price equal to 101%
of the principal amount thereof on the date of purchase, plus accrued and unpaid
interest to the Designated Event Payment Date. Holders of Convertible Notes
that are subject to an offer to purchase will receive a Designated Event Offer
from the Company prior to any related Designated Event Payment Date and may
elect to have such Convertible Notes or portions thereof in authorized
denominations purchased by completing the form entitled "Option of Noteholder To
Elect Purchase" appearing below. Noteholders have the right to withdraw their
election by delivering a written notice of withdrawal to the Paying Agent in
accordance with the terms of the Indenture.
A1-6
9. Subordination. The payment of the principal of, interest on or
--------------
any other amounts due on the Convertible Notes is subordinated in right of
payment to all existing and future Senior Debt of the Company, as described in
the Indenture. Each Noteholder, by accepting a Convertible Note, agrees to such
subordination and authorizes and directs the Trustee on its behalf to take such
action as may be necessary or appropriate to effectuate the subordination so
provided and appoints the Trustee as its attorney-in-fact for such purpose.
10. Conversion. The holder of any Convertible Note has the right,
----------
exercisable at any time after 90 days following the date of original issuance
thereof and prior to the close of business (New York City time) on the date of
the Convertible Note's maturity, to convert the principal amount thereof (or any
portion thereof that is an integral multiple of $1,000) into shares of Common
Stock at the initial Conversion Price of $26.80 per share, subject to adjustment
under certain circumstances, except that if a Convertible Note is called for
redemption, the conversion right will terminate at the close of business on the
third Business Day immediately preceding the date fixed for redemption.
To convert a Convertible Note, a holder must (1) complete and sign a
notice of election to convert substantially in the form set forth below, (2)
surrender the Convertible Note to a Conversion Agent, (3) furnish appropriate
endorsements or transfer documents if required by the Registrar or Conversion
Agent and (4) pay any transfer or similar tax, if required. Upon conversion, no
adjustment or payment will be made for interest or dividends, but if any
Noteholder surrenders a Convertible Note for conversion after the close of
business on the record date for the payment of an installment of interest and
prior to the opening of business on the next interest payment date, then,
notwithstanding such conversion, the interest payable on such interest payment
date will be paid to the registered holder of such Convertible Note on such
record date. In such event, such Convertible Note not called for redemption
when surrendered for conversion, must be accompanied by payment in funds
acceptable to the Company of an amount equal to the interest payable on such
interest payment date on the portion so converted. The number of shares of
Common Stock issuable upon conversion of a Convertible Note is determined by
dividing the principal amount of the Convertible Note converted by the
Conversion Price in effect on the Conversion Date. No fractional shares will be
issued upon conversion but a cash adjustment will be made for any fractional
interest.
A Note in respect of which a holder has delivered an "Option of Noteholder
to Elect Purchase" form appearing below exercising the option of such holder to
require the Company to purchase such Note may be converted only if the notice of
exercise is withdrawn as provided above and in accordance with the terms of the
Indenture. The above description of conversion of the Convertible Notes is
qualified by reference to, and is subject in its entirety to, the more complete
description thereof contained in the Indenture.
11. Registration Rights. The holder of this Convertible Note is
-------------------
entitled to the benefits of a Registration Agreement, dated April 29, 1996,
between the Company and the Initial Purchaser (the "Registration Agreement").
Pursuant to the Registration Agreement the Company has agreed for the benefit of
the holders of the Convertible Notes, that (i) it will, at its cost, no later
than December 15, 1996, file a shelf registration statement (the "Shelf
Registration Statement") with the Securities and Exchange Commission (the
"Commission") with respect to resales of the Convertible Notes and the Common
Stock issuable upon conversion thereof, (ii) no later than February 15, 1997,
such Shelf Registration Statement shall be declared effective by the Commission
and (iii) the Company will maintain such Shelf Registration Statement
continuously effective under the Securities Act until the third anniversary (or
such shorter period as may then be applicable under
A1-7
the Securities Act regarding the holding period for securities under Rule 144(k)
of the Securities Act or any successor rule) of the date of the closing of the
sale of the Convertible Notes (the "Closing"), or such earlier date as of which
all the Convertible Notes or the Common Stock issuable upon conversion thereof
have been sold pursuant to such Shelf Registration Statement. If the Company
fails to comply with clause (i) above then, at such time, the per annum interest
rate on the Convertible Notes will increase by 25 basis points. Such increase
will remain in effect until the date on which such Shelf Registration Statement
is filed, on which date the interest rate on the Convertible Notes will revert
to the interest rate originally borne by the Convertible Notes plus any increase
in such interest rate pursuant to the following sentence. If the Shelf
Registration Statement is not declared effective as provided in clause (ii)
above, then, at such time and on each date that would have been the successive
30th day following such time, the per annum interest rate on the Convertible
Notes (which interest rate will be the original interest rate on the Convertible
Notes plus any increase or increases in such interest rate pursuant to the
preceding sentence and this sentence) will increase by an additional 25 basis
points; provided that the interest rate will not increase by more than 50 basi s
points pursuant to this sentence and will not increase by more than 75 basis
points pursuant to this sentence and the preceding sentence. Such increase or
increases will remain in effect until the date on which such Shelf Registration
Statement is declared effective, on which date the interest rate on the
Convertible Notes will revert to the interest rate originally borne by the
Convertible Notes. Pursuant to clause (iii) above, however, if the Company
fails to keep the Shelf Registration Statement continuously effective for the
period specified above, then at such time as the Shelf Registration Statement is
no longer effective and on each date thereafter that is the successive 30th day
subsequent to such time and until the earlier of (i) the date that the Shelf
Registration Statement is again deemed effective or (ii) the date that is the
third anniversary of the Closing or (iii) the date as of which all of the
Convertible Notes and/or the Common Stock issuable upon conversion thereof are
sold pursuant to the Shelf Registration Statement, the per annum interest rate
on the Convertible Notes will increase by an additional 25 basis points;
provided, however, that the interest rate will not increase by more than 50
basis points pursuant to this sentence.
Pursuant to the Registration Agreement, the Company may suspend the
use of the prospectus which is a part of the Shelf Registration Statement for a
period not to exceed 45 days in any three month period or two periods not to
exceed an aggregate of 75 days in any twelve month period under certain
circumstances. The holders of Convertible Notes will not be entitled to
additional interest as set forth in the preceding paragraph solely because of
such permitted suspensions.
12. Denominations, Transfer, Exchange. The Convertible Notes are in
---------------------------------
registered form, without coupons, in denominations of $1,000 and integral
multiples of $1,000. The transfer of Convertible Notes may be registered, and
Convertible Notes may be exchanged, as provided in the Indenture. The Registrar
may require a Noteholder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not exchange or register
the transfer of any Convertible Note or portion of a Convertible Note selected
for redemption (except the unredeemed portion of any Convertible Note being
redeemed in part). Also, it need not exchange or register the transfer of any
Convertible Note for a period of 15 days before a selection of Convertible Notes
to be redeemed.
13. Persons Deemed Owners. Except as provided in paragraph 2 of this
---------------------
Convertible Note, the registered Noteholder of a Convertible Note may be treated
as its owner for all purposes.
A1-8
14. Unclaimed Money. If money for the payment of principal or
---------------
interest remains unclaimed for two years, the Trustee and the Paying Agent shall
pay the money back to the Company. After that, Noteholders of Convertible Notes
entitled to the money must look to the Company for payment unless an abandoned
property law designates another person and all liability of the Trustee and such
Paying Agent with respect to such money shall cease.
15. Defaults and Remedies. The Convertible Notes shall have the
---------------------
Events of Default as set forth in Section 8.01 of the Indenture. Subject to
certain limitations in the Indenture, if an Event of Default occurs and is
continuing, the Trustee by notice to the Company or the Noteholders of at least
25% in aggregate principal amount of the then outstanding Convertible Notes by
notice to the Company and the Trustee may declare all the Convertible Notes to
be due and payable immediately, except that in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, all unpaid principal
and interest accrued on the Convertible Notes shall become due and payable
immediately without further action or notice. Upon acceleration as described in
either of the preceding sentences, the subordination provisions of the Indenture
preclude any payment being made to Noteholders for at least 5 days except as
otherwise provided in the Indenture.
The Noteholders of a majority in principal amount of the Convertible
Notes then outstanding by written notice to the Trustee 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 principal or interest that has become due solely
because of the acceleration. Noteholders may not enforce the Indenture or the
Convertible Notes except as provided in the Indenture. Subject to certain
limitations, Noteholders of a majority in principal amount of the then
outstanding Convertible Notes issued under the Indenture may direct the Trustee
in its exercise of any trust or power. The Company must furnish compliance
certificates to the Trustee annually. The above description of Events of
Default and remedies is qualified by reference to, and subject in its entirety
to, the more complete description thereof contained in the Indenture.
16. Amendments, Supplements and Waivers. Subject to certain
-----------------------------------
exceptions, the Indenture or the Convertible Notes may be amended or
supplemented with the consent of the Noteholders of at least a majority in
principal amount of the then outstanding Convertible Notes (including consents
obtained in connection with a tender offer or exchange offer for Convertible
Notes), and any existing default may be waived with the consent of the
Noteholders of a majority in principal amount of the then outstanding
Convertible Notes including consents obtained in connection with a tender offer
or exchange offer for Convertible Notes. Without the consent of any Noteholder,
the Indenture or the Convertible Notes may be amended, among other things, to
cure any ambiguity, defect or inconsistency, to provide for assumption of the
Company's obligations to Noteholders, to make any change that does not adversely
affect the rights of any Noteholder, to qualify the Indenture under the TIA, and
to comply with the requirements of the SEC in order to maintain the
qualification of the Indenture under the TIA.
17. Trustee Dealings with the Company. The Trustee, in its
---------------------------------
individual or any other capacity, may become the owner or pledgee of Convertible
Notes and may otherwise deal with the Company or an Affiliate with the same
rights it would have if it were not Trustee, subject to certain limitations
provided for in the Indenture and in the TIA. Any Agent may do the same with
like rights.
A1-9
18. No Recourse Against Others. A director, officer, employee or
--------------------------
shareholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Convertible Notes or the Indenture or for
any claim based on, in respect of or by reason of such obligations or their
creation. Each Noteholder, by accepting a Convertible Note, waives and releases
all such liability. The waiver and release are part of the consideration for
the issue of the Convertible Notes.
19. Governing Law. THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL
-------------
GOVERN THE INDENTURE AND THE CONVERTIBLE NOTES WITHOUT REGARD TO CONFLICT OF LAW
PROVISIONS THEREOF.
20. Authentication. The Convertible Notes shall not be valid until
--------------
authenticated by the manual signature of an authorized officer of the Trustee or
an authenticating agent.
21. Abbreviations. Customary abbreviations may be used in the name
-------------
of a Noteholder or an assignee, such as: TEN COM (for tenants in common), TEN
ENT (for tenants by the entireties), JT TEN (for joint tenants with right of
survivorship and not as tenants in common), CUST (for Custodian), and U/G/M/A
(for Uniform Gifts to Minors Act).
22. Definitions. Capitalized terms not defined in this Convertible
-----------
Note have the meaning given to them in the Indenture.
The Company will furnish to any Noteholder of the Convertible Notes
upon written request and without charge a copy of the Indenture. Request may be
made to:
Stillwater Mining Company
XX 00
Xxx 000
Xxx, Xxxxxxx 00000
Attention of: Chief Financial Officer
-----------------------
A1-10
ASSIGNMENT FORM
To assign this Convertible Note, fill in the form below:
(I) or (we) assign and transfer this Convertible Note to
--------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint _______________________________________________ agent to
transfer this Convertible Note on the books of the Company. The agent may
substitute another to act for him.
Your Signature:
-----------------------------------------
(Sign exactly as your name appears on
the other side of this Convertible Note)
Date: Signature Guarantee:***
----------------- ---------------------------------
In connection with any transfer of any of the Convertible Notes evidenced by
this certificate occurring prior to the date that is three years (or such
shorter period as may then be applicable under the Securities Act) after the
later of the date of original issuance of such Convertible Notes and the last
date, if any, on which such Convertible Notes were owned by the Company or any
Affiliate of the Company, the undersigned confirms that such Convertible Notes
are being transferred:
--------------------------
*** Signature must be guaranteed by a commercial bank, trust company or
member firm of the New York Stock Exchange.
A1-11
CHECK ONE BOX BELOW
(1) [_] to the Company; or
(2) [_] pursuant to and in compliance with Rule 144A under the Securities
Act of 1933; or
(3) [_] pursuant to and in compliance with Regulation S under the
Securities Act of 1933; or
(4) [_] to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act of 1933 that has furnished to the Trustee a signed letter
containing certain representations and agreements (the form of
which letter can be obtained from the Trustee); or
(5) [_] pursuant to another available exemption from the registration
requirements of the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any
of the Convertible Notes evidenced by this certificate in the name of any
person other than the registered holder thereof; provided, however, that if
-------- -------
box (3), (4) or (5) is checked, the Trustee may require, prior to
registering any such transfer of the Convertible Notes such legal opinions,
certifications and other information as the Company has reasonably
requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided
by Rule 144 under such Act.
-------------------------------
Signature
Signature Guarantee:/*/
---------------------------- -------------------------------
Signature must be guaranteed Signature
-------------------------------------------------------------------------------
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this
Convertible Note for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule 144A or
has determined not to request such information and that it is
----------------------
/*/ Signature must be guaranteed by a commercial bank, trust company or
member firm of the New York Stock Exchange.
A1-12
aware that the transferor is relying upon the undersigned's foregoing
representations in order to claim the exemption from registration provided by
Rule 144A.
Dated: __________________ _________________________________________________
NOTICE: To be executed by an executive officer
A1-13
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE A
The initial principal amount at maturity of this Global Note shall be
$__________. The following increases or decreases in the principal amount of
this Global Note have been made:
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Amount of increase
in
Principal Amount of
this Global Note Principal Amount of
including upon Amount of decrease this Global Note Signature of
exercise of the over in Principal Amount following such authorized officer of
Date Made allotment option of this Global Note decrease or increase Trustee or Custodian
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A1-14
OPTION OF NOTEHOLDER TO ELECT PURCHASE
If you want to elect to have this Convertible Note or a portion
thereof repurchased by the Company pursuant to Section 3.08 or 4.07 of the
Indenture, check the box: [ ]
If the purchase is in part, indicate the portion (in denominations of
$1,000 or any integral multiple thereof) to be purchased: ________________
Your Signature:__________________________________________
(Sign exactly as your name appears on the
other side of this Convertible Note)
Date:____________________________________________________
Signature Guarantee: /*/_________________________________
___________________
/*/ Signature must be guaraneed by a commercial bank, trust company or member
firm of the New York Stock Exchange.
A1-15
ELECTION TO CONVERT
To Stillwater Mining Company:
The undersigned owner of this Convertible Note hereby irrevocably
exercises the option to convert this Convertible Note, or the portion below
designated, into Common Stock of STILLWATER MINING COMPANY in accordance with
the terms of the Indenture referred to in this Convertible Note, and directs
that the shares issuable and deliverable upon conversion, together with any
check in payment for fractional shares, be issued in the name of and delivered
to the undersigned, unless a different name has been indicated in the assignment
below. If shares are to be issued in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto.
Any Noteholder, upon the exercise of its conversion rights in
accordance with the terms of the Indenture and the Convertible Note, agrees to
be bound by the terms of the Registration Agreement relating to the Common Stock
issuable upon conversion of the Convertible Note.
Date:
in whole [ ]
Portions of Convertible Note to be converted
($1,000 or integral multiples thereof):
$_______________________________________________
_____________________________________________________
Signature (for conversion only)
Please Print or Typewrite Name and Address,
Including Zip Code, and Social Security or Other
Identifying Number
Signature Guarantee: *_______________________________
___________________
* Signature must be guaranteed by a commercial bank, trust company or
member firm of the New York Stock Exchange.
A1-16
EXHIBIT A-2
[FACE OF REGULATION S TEMPORARY GLOBAL NOTE]
================================================================================
No. ________
CUSIP No. ________
STILLWATER MINING COMPANY
7% CONVERTIBLE SUBORDINATED NOTES
DUE 2003
STILLWATER MINING COMPANY
Subject to the provisions hereof, Stillwater Mining Company, a Delaware
corporation (the "Company") promises to pay to
_________________________________________________________________ or registered
assigns, the principal sum indicated on Schedule A hereof on May 1, 2003, and to
pay interest thereon beginning November 1, 1996 at the rate of 7% per annum.
Interest Payment Dates: May 1 and November 1,
commencing November 1, 1996
Record Dates: April 15 and October 15
Reference is hereby made to the further provisions of this Convertible
Note set forth on the reverse hereof which further provisions shall for all
purposes have the same effect as if set forth at this place.
A2-1
IN WITNESS WHEREOF, Stillwater Mining Company has caused this
Convertible Note to be signed manually or by facsimile by its duly authorized
officers and a facsimile of its corporate seal to be affixed hereto or imprinted
hereon.
Dated: _________________
STILLWATER MINING COMPANY
By __________________________________________
By __________________________________________
[Seal]
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
This is one of the 7%
Convertible Subordinated Notes
due 2003 described in the
within-mentioned Indenture.
COLORADO NATIONAL BANK,
as Trustee
By ____________________________
Authorized Officer
================================================================================
A2-2
[Back of Regulation S Temporary Global Note]
7% Convertible Note due 2003
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF DTC 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 THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE THIRD ANNIVERSARY OF THE
ISSUANCE HEREOF (OR ANY PREDECESSOR SECURITY HERETO) OR (Y) BY ANY HOLDER THAT
WAS AN AFFILIATE OF THE COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING
THE DATE OF SUCH TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO
LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT ("RULE 144A") TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A PURCHASING FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (3) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON
THE REVERSE OF THIS SECURITY), AND, IF SUCH TRANSFER IS BEING EFFECTED BY
CERTAIN TRANSFERORS SPECIFIED IN THE INDENTURE (AS DEFINED BELOW) PRIOR TO THE
EXPIRATION OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE
903(C)(3) OF REGULATION S UNDER THE SECURITIES ACT), A CERTIFICATE WHICH MAY BE
OBTAINED FROM THE COMPANY OR THE TRUSTEE IS DELIVERED BY THE TRANSFEREE TO THE
COMPANY AND THE TRUSTEE, (4) TO AN INSTITUTION THAT IS AN "ACCREDITED
A2-3
INVESTOR" AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER
THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING THIS
SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND A CERTIFICATE IN
THE FORM ATTACHED TO THIS SECURITY IS DELIVERED BY THE TRANSFEREE TO THE COMPANY
AND THE TRUSTEE (PROVIDED THAT CERTAIN HOLDERS SPECIFIED IN THE INDENTURE MAY
NOT TRANSFER THIS SECURITY PURSUANT TO THIS CLAUSE (4) PRIOR TO THE EXPIRATION
OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE 903(C)(3) OF
REGULATION S UNDER THE SECURITIES ACT), (5) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER
THE SECURITIES ACT, OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES. AN INSTITUTIONAL ACCREDITED INVESTOR
HOLDING THIS SECURITY AGREES THAT IT WILL FURNISH TO THE COMPANY AND THE TRUSTEE
SUCH CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE TO
CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING
RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND
AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL
BUYER WITHIN THE MEANING OF RULE 144A OR (2) AN INSTITUTION THAT IS AN
"ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY FOR
INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) A NON-U.S. PERSON OUTSIDE
THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE
REQUIREMENTS OF PARAGRAPH (O)(2) OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT."
THE RIGHTS ATTACHING TO THIS REGULATION S TEMPORARY GLOBAL NOTE, AND THE
CONDITIONS AND PROCEDURES GOVERNING ITS EXCHANGE FOR CERTIFICATED NOTES, ARE AS
SPECIFIED IN THE INDENTURE (AS DEFINED HEREIN).
NEITHER THE HOLDER NOR THE BENEFICIAL OWNERS OF THIS REGULATION S TEMPORARY
GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF INTEREST HEREON.
Interest on the Convertible Notes will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the date of
original issuance in accordance with the terms hereof. Interest will be computed
on the basis of a 360-day year comprised of twelve 30-day months.
This Regulation S Temporary Global Note is issued in respect of an issue of
7% Convertible Subordinated Notes due 2003 (the "Convertible Notes") of the
Company, limited to the aggregate principal amount of U.S. $50,000,000 (plus
$7,500,000 aggregate principal amount of Convertible Notes that may be sold by
the Company pursuant to the over allotment option granted pursuant to the
Purchase Agreement) issued pursuant to an Indenture (the "Indenture") dated as
of April 29, 1996, between the Company and Colorado National Bank, as trustee
(the "Trustee"), and is governed by the terms and conditions of the Indenture
governing the Convertible Notes, which terms and conditions are incorporated
herein by reference
A2-4
and, except as otherwise provided herein, shall be binding on the Company and
the holder hereof as if fully set forth herein. Unless the context otherwise
requires, the terms used herein shall have the meanings specified in the
Indenture.
Until this Regulation S Temporary Global Note is exchanged for Regulation S
Permanent Global Notes, the holder hereof shall not be entitled to receive
payments of interest hereon; until so exchanged in full, this Regulation S
Temporary Global Note shall in all other respects be entitled to the same
benefits as other Convertible Notes under the Indenture.
This Regulation S Temporary Global Note is exchangeable in whole or in part
for one or more Regulation S Permanent Global Notes or Rule 144A Global Notes
only (i) on or after the termination of the 40-day restricted period (as defined
in Regulation S) and (ii) upon presentation of certificates (accompanied by an
Opinion of Counsel, if applicable) required by Article 2 of the Indenture. Upon
exchange of this Regulation S Temporary Global Note for one or more Regulation S
Permanent Global Notes or Rule 144A Global Notes, the Trustee shall cancel this
Regulation S Temporary Global Note.
This Regulation S Temporary Global Note shall not become valid or
obligatory until the certificate of authentication hereon shall have been duly
manually signed by the Trustee in accordance with the Indenture. This
Regulation S Temporary Global Note shall be governed by and construed in
accordance with the laws of the State of New York. All references to "$,"
"Dollars," "dollars" or "U.S. $" are to such coin or currency of the United
States of America as at the time shall be legal tender for the payment of public
and private debts therein.
A2-5
EXHIBIT B-1
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM RULE 144A GLOBAL NOTE TO REGULATION S GLOBAL NOTE
(Pursuant to Section 2.06(a)(i) of the Indenture)
Colorado National Bank
000 Xxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Division
Re: 7% Convertible Subordinated Notes due 2003 of Stillwater Mining
Company (the "Convertible Notes")
Reference is hereby made to the Indenture, dated as of April 29, 1996
(the "Indenture"), between Stillwater Mining Company, as issuer (the "Company")
and Colorado National Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
This letter relates to the Convertible Notes which are evidenced by
one or more Rule 144A Global Notes (CUSIP No. 00000XXX0) and held with the
Depositary in the name of Cede & Co. (the "Transferor"). The Transferor has
requested a transfer of such beneficial interest in the Convertible Notes to a
Person who will take delivery thereof in the form of an equal principal amount
of Convertible Notes evidenced by one or more Regulation S Global Notes (SINS
No. X00000XX0), which amount, immediately after such transfer, is to be held
with the Depositary through Euroclear or Cedel or both (Common Code
_____________).
In connection with such request and in respect of such Convertible
Notes, the Transferor hereby certifies that such transfer has been effected in
compliance with the transfer restrictions applicable to the Global Notes and
pursuant to and in accordance with Rule 903 or Rule 904 under the United States
Securities Act of 1933, as amended (the "Securities Act"), and accordingly the
Transferor hereby further certifies that:
(1) The offer of the Convertible Notes was not made to a person in the
United States;
(2) either:
(a) at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person acting
on its behalf reasonably believed and believes that the
transferee was outside the United States; or
(b) the transaction was executed in, on or through the facilities of
a designated offshore securities market and neither the
Transferor nor any person acting on its behalf knows that the
transaction was prearranged with a buyer in the United States;
(3) no directed selling efforts have been made in contravention of the
requirements of Rule 904(b) of Regulation S;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
B1-1
(5) upon completion of the transaction, the beneficial interest being
transferred as described above is to be held with the Depositary
through Euroclear or Cedel or both (Common Code ____________).
Upon giving effect to this request to exchange a beneficial interest
in a Rule 144A Global Note for a beneficial interest in a Regulation S Global
Note, the resulting beneficial interest shall be subject to the restrictions on
transfer applicable to Regulation S Global Notes pursuant to the Indenture and
the Securities Act and, if such transfer occurs prior to the end of the 40-day
restricted period associated with the initial offering of Convertible Notes, the
additional restrictions applicable to transfers of interest in the Regulation S
Temporary Global Note.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and Salomon Brothers Inc, Seven World
Trade Center, New York, New York, the initial purchaser of such Convertible
Notes being transferred. Terms used in this certificate and not otherwise
defined in the Indenture have the meanings set forth in Regulation S under the
Securities Act.
___________________________________________
[Insert Name of Transferor]
By: _______________________________________
Name:
Title:
Dated: ____________________, ____
cc: Stillwater Mining Company
Salomon Brothers Inc
B1-2
EXHIBIT B-2
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM REGULATION S GLOBAL NOTE TO RULE 144A GLOBAL NOTE
(Pursuant to Section 2.06(a)(ii) of the Indenture)
Colorado National Bank
000 Xxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Division
Re: 7% Convertible Subordinated Notes due 2003 of Stillwater Mining
Company (the "Convertible Notes")
Reference is hereby made to the Indenture, dated as of April 29, 1996
(the "Indenture"), between Stillwater Mining Company, as issuer (the "Company")
and Colorado National Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
This letter relates to the Convertible Notes which are evidenced by
one or more Regulation S Global Notes (SINS No. X00000XX0) and held with the
Depositary through [Euroclear] [Cedel] (Common Code ___________________) in the
name of ____________________ (the "Transferor"). The Transferor has requested a
transfer of such beneficial interest in the Notes to a Person who will take
delivery thereof in the form of an equal principal amount of Notes evidenced by
one or more Rule 144A Global Notes (CUSIP No. 00000XXX0), to be held with the
Depositary.
In connection with such request and in respect of such Notes, the
Transferor hereby certifies that:
[CHECK ONE]
[ ] such transfer is being effected pursuant to and in accordance with
Rule 144A under the United States Securities Act of 1933, as amended
(the "Securities Act"), and, accordingly, the Transferor hereby
further certifies that the Notes are being transferred to a Person
that the Transferor reasonably believes is purchasing the Notes for
its own account, or for one or more accounts with respect to which
such Person exercises sole investment discretion, and such Person and
each such account is a "qualified institutional buyer" within the
meaning of Rule 144A in a transaction meeting the requirements of Rule
144A;
or
[ ] such transfer is being effected pursuant to and in accordance with
Rule 144 under the Securities Act;
or
[ ] such transfer is being effected pursuant to an effective registration
statement under the Securities Act;
or
B2-1
[ ] such transfer is being effected pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A
or Rule 144, and the Transferor hereby further certifies that the
Convertible Notes are being transferred in compliance with the
transfer restrictions applicable to the Global Notes and in accordance
with the requirements of the exemption claimed, which certification is
supported by an Opinion of Counsel, provided by the Transferor or the
transferee (a copy of which the Transferor has attached to this
certification) in form reasonably acceptable to the Company and to the
Registrar, to the effect that such transfer is in compliance with the
Securities Act;
and such Convertible Notes are being transferred in compliance with any
applicable blue sky securities laws of any state of the United States.
Upon giving effect to this request to exchange a beneficial interest
in Regulation S Global Notes for a beneficial interest in Rule 144A Global
Notes, the resulting beneficial interest shall be subject to the restrictions on
transfer applicable to Rule 144A Global Notes pursuant to the Indenture and the
Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and Salomon Brothers Inc, Seven World
Trade Center, New York, New York, the initial purchaser of such Convertible
Notes being transferred.
___________________________________________
[Insert Name of Transferor]
By: _______________________________________
Name:
Title:
Dated: _____________, _____
cc: Stillwater Mining Company
Salomon Brothers Inc
B2-2
EXHIBIT B-3
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
OF CERTIFICATED CONVERTIBLE NOTES
(Pursuant to Section 2.06(b) of the Indenture)
Colorado National Bank
000 Xxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Division
Re: 7% Convertible Subordinated Notes due 2003 of Stillwater Mining
Company (the "Convertible Notes")
Reference is hereby made to the Indenture, dated as of April 29, 1996
(the "Indenture"), between Stillwater Mining Company, as issuer (the "Company")
and Colorado Natioanl Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
In connection with such request and in respect of the Convertible
Notes surrendered to the Trustee herewith for exchange (the "Surrendered
Notes"), the holder of such Surrendered Notes hereby certifies that:
[CHECK ONE]
[ ] the Surrendered Notes are being transferred pursuant to and in
accordance with Rule 144A under the United States Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, the
Transferor hereby further certifies that the Surrendered Notes are
being transferred to a Person that the Transferor reasonably believes
is purchasing the Surrendered Notes for its own account, or for one or
more accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A, in
each case in a transaction meeting the requirements of Rule 144A;
or
[ ] the Surrendered Notes are being transferred in a transaction permitted
by Rule 144 under the Securities Act;
or
[ ] the Surrendered Notes are being transferred pursuant to an effective
registration statement under the Securities Act;
or
[ ] such transfer is being effected pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A
or Rule 144, and the Transferor hereby further certifies that the
Notes are being transferred in compliance with the transfer
restrictions applicable to the Global Notes and in accordance with the
requirements of the exemption claimed, which certification is
supported by an Opinion of Counsel, provided by the transferor or the
transferee (a copy of which the Transferor has attached to this
certification)
B3-1
in form reasonably acceptable to the Company and to the Registrar, to
the effect that such transfer is in compliance with the Securities
Act;
and the Surrendered Notes are being transferred in compliance with any
applicable blue sky securities laws of any state of the United States.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and Salomon Brothers Inc, Seven World
Trade Center, New York, New York, the initial purchaser of such Notes being
transferred. Terms used in this certificate and not otherwise defined in the
Indenture have the meanings set forth in Regulation S under the Securities Act.
__________________________
[Insert Name of Transferor]
By:_______________________________
Name:
Title:
Dated: _____________, _____
cc: Stillwater Mining Company
Salomon Brothers Inc
B3-2
EXHIBIT B-4
FORM OF CERTIFICATE FOR EXCHANGE OR REGISTRATION OF TRANSFER
FROM RULE 144A GLOBAL NOTE OR REGULATION S PERMANENT GLOBAL NOTE
TO CERTIFICATED CONVERTIBLE NOTE
(Pursuant to Section 2.06(c) of the Indenture)
Colorado National Bank
000 Xxxxxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Division
Re: 7% Convertible Subordinated Notes due 2003 of Stillwater Mining
Company (the "Convertible Notes")
Reference is hereby made to the Indenture, dated as of April 29, 1996
(the "Indenture"), between Stillwater Mining Company, as issuer (the "Company")
and Colorado National Bank, as trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture.
In connection with such request and in respect of the Notes
surrendered to the Trustee herewith for exchange (the "Surrendered Notes"), the
holder of such Surrendered Notes hereby certifies that:
[CHECK ONE]
[ ] the Surrendered Notes are being transferred to the beneficial owner of
such Notes;
or
[ ] the Surrendered Notes are being transferred pursuant to and in
accordance with Rule 144A under the United States Securities Act of
1933, as amended (the "Securities Act"), and, accordingly, the
Transferor hereby further certifies that the Surrendered Notes are
being transferred to a Person that the Transferor reasonably believes
is purchasing the Surrendered Notes for its own account, or for one or
more accounts with respect to which such Person exercises sole
investment discretion, and such Person and each such account is a
"qualified institutional buyer" within the meaning of Rule 144A, in
each case in a transaction meeting the requirements of Rule 144A;
or
[ ] the Surrendered Notes are being transferred in a transaction permitted
by Rule 144 under the Securities Act;
or
[ ] the Surrendered Notes are being transferred pursuant to an effective
registration statement under the Securities Act;
B4-1
or
[ ] such transfer is being effected pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A
or Rule 144, and the Transferor hereby further certifies that the
Notes are being transferred in compliance with the transfer
restrictions applicable to the Global Notes and in accordance with the
requirements of the exemption claimed, which certification is
supported by an Opinion of Counsel, provided by the transferor or the
transferee (a copy of which the Transferor has attached to this
certification) in form reasonably acceptable to the Company and to the
Registrar, to the effect that such transfer is in compliance with the
Securities Act;
and the Surrendered Notes are being transferred in compliance with any
applicable blue sky securities laws of any state of the United States.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and Salomon Brothers Inc, Seven World
Trade Center, New York, New York, the initial purchaser of such Notes being
transferred. Terms used in this certificate and not otherwise defined in the
Indenture have the meanings set forth in Regulation S under the Securities Act.
__________________________
[Insert Name of Transferor]
By:____________________________________
Name:
Title:
Dated: _____________, _____
cc: Stillwater Mining Company
Salomon Brothers Inc
B4-2
