EXHIBIT 4.1
EXECUTION COPY
REGENERON PHARMACEUTICALS, INC.
5-1/2% Convertible Senior Subordinated Notes
due 2008
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INDENTURE
Dated as of October 17, 2001
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AMERICAN STOCK TRANSFER & TRUST COMPANY
TRUSTEE
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CROSS REFERENCE TABLE*
TIA SECTION ......................... INDENTURE SECTION
310(a)(1) ........................... 7.09
(a)(2) ........................... 7.09
(a)(3) ........................... N.A.
(a)(4) ........................... N.A.
(b) .............................. 7.08; 7.10
(c) .............................. N.A.
311(a) .............................. 7.13
(b) .............................. 7.13
(c) .............................. N.A.
312(a) .............................. 2.05
(b) .............................. 12.03
(c) .............................. 12.03
313(a) .............................. 7.14
(b)(1) ........................... N.A.
(b)(2) ........................... 7.14
(c) .............................. 12.02
(d) .............................. 7.14
314(a) .............................. 4.02; 4.03; 12.02
(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) .............................. 7.01
(b) .............................. 7.15; 12.02
(c) .............................. 7.01
(d) .............................. 7.01
(e) .............................. 6.11
316(a) (last sentence) . .... ....... 2.08
(a)(1)(A) ........................ 6.05
(a)(1)(B) ........................ 6.04
(a)(2) ........................... N.A.
(b) .............................. 6.07
317(a)(1) ........................... 6.08
(a)(2) ........................... 6.09
(b) .............................. 2.04
318(a) .............................. 12.01
N.A. means Not Applicable.
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* Note: This Cross Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
TABLE OF CONTENTS*
PAGE
ARTICLE 1 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION.......... 1
SECTION 1.01 Definitions............................................... 1
SECTION 1.02 Other Definitions......................................... 11
SECTION 1.03 Incorporation by Reference of Trust Indenture Act......... 11
SECTION 1.04 Rules of Construction..................................... 12
SECTION 1.05 Acts of Holders........................................... 12
ARTICLE 2 THE NOTES........................................................ 13
SECTION 2.01 Form and Dating........................................... 13
SECTION 2.02 Execution and Authentication.............................. 15
SECTION 2.03 Registrar, Paying Agent and Conversion Agent.............. 15
SECTION 2.04 Paying Agent to Hold Money and Notes in Trust............. 16
SECTION 2.05 Noteholder Lists.......................................... 16
SECTION 2.06 Transfer and Exchange..................................... 17
SECTION 2.07 Replacement Notes......................................... 18
SECTION 2.08 Outstanding Notes; Determinations of Holders' Action...... 19
SECTION 2.09 Temporary Notes........................................... 19
SECTION 2.10 Cancellation.............................................. 20
SECTION 2.11 Persons Deemed Owners..................................... 20
SECTION 2.12 Global Notes.............................................. 20
SECTION 2.13 CUSIP Numbers............................................. 24
SECTION 2.14 Defaulted Interest........................................ 25
ARTICLE 3 REDEMPTION AND PURCHASES......................................... 25
SECTION 3.01 Provisional Redemption.................................... 25
SECTION 3.02 Optional Redemption....................................... 26
SECTION 3.03 Notice of Trustee......................................... 26
SECTION 3.04 Selection of Notes to be Redeemed......................... 26
SECTION 3.05 Notice of Redemption...................................... 27
SECTION 3.06 Effect of Notice of Redemption............................ 27
SECTION 3.07 Deposit of Redemption Price............................... 28
SECTION 3.08 Notes Redeemed in Part.................................... 28
SECTION 3.09 Conversion Arrangement on Call for Redemption............. 29
SECTION 3.10 Repurchase of Notes at Option of the Holder upon Change of
Control................................................... 29
SECTION 3.11 Effect of Change of Control Repurchase Notice............. 33
SECTION 3.12 Deposit of Change of Control Repurchase Price............. 34
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* Note: This Table of Contents shall not, for any purpose, be deemed to be part
of the Indenture.
i
SECTION 3.13 Notes Purchased in Part................................... 34
SECTION 3.14 Covenant to Comply with Securities Laws upon Purchase of
Notes..................................................... 35
SECTION 3.15 Repayment to the Company.................................. 35
ARTICLE 4 COVENANTS........................................................ 35
SECTION 4.01 Payment of Principal, Premium, Interest on the Notes...... 35
SECTION 4.02 SEC and Other Reports..................................... 36
SECTION 4.03 Compliance Certificate.................................... 36
SECTION 4.04 Further Instruments and Acts.............................. 36
SECTION 4.05 Maintenance of Office or Agency........................... 36
SECTION 4.06 Delivery of Certain Information........................... 37
SECTION 4.07 Subordination............................................. 37
ARTICLE 5 SUCCESSOR CORPORATION............................................ 37
SECTION 5.01 When Company May Merge or Transfer Assets................. 37
ARTICLE 6 DEFAULTS AND REMEDIES............................................ 38
SECTION 6.01 Events of Default......................................... 38
SECTION 6.02 Acceleration.............................................. 40
SECTION 6.03 Other Remedies............................................ 40
SECTION 6.04 Waiver of Past Defaults................................... 41
SECTION 6.05 Control by Majority....................................... 41
SECTION 6.06 Limitation on Suits....................................... 41
SECTION 6.07 Rights of Holders to Receive Payment...................... 42
SECTION 6.08 Collection Suit by Trustee................................ 42
SECTION 6.09 Trustee May File Proofs of Claim.......................... 42
SECTION 6.10 Priorities................................................ 43
SECTION 6.11 Undertaking for Costs..................................... 43
SECTION 6.12 Waiver of Stay, Extension or Usury Laws................... 43
ARTICLE 7 TRUSTEE.......................................................... 44
SECTION 7.01 Duties and Responsibilities of the Trustee; During
Default; Prior to Default................................. 44
SECTION 7.02 Certain Rights of the Trustee............................. 45
SECTION 7.03 Trustee Not Responsible for Recitals, Disposition of Notes
or Application of Proceeds Thereof........................ 46
SECTION 7.04 Trustee and Agents May Hold Notes; Collections, etc....... 46
SECTION 7.05 Moneys Held by Trustee.................................... 46
SECTION 7.06 Compensation and Indemnification of Trustee and Its Prior
Claim..................................................... 47
SECTION 7.07 Right of Trustee to Rely on Officers' Certificate, etc.... 47
SECTION 7.08 Conflicting Interests..................................... 47
SECTION 7.09 Persons Eligible for Appointment as Trustee............... 48
SECTION 7.10 Resignation and Removal; Appointment of Successor Trustee. 48
SECTION 7.11 Acceptance of Appointment by Successor Trustee............ 49
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SECTION 7.12 Merger, Conversion, Consolidation or Succession to
Business of Trustee....................................... 50
SECTION 7.13 Preferential Collection of Claims Against the Company..... 50
SECTION 7.14 Reports by the Trustee.................................... 50
SECTION 7.15 Trustee to Give Notice of Default, But May Withhold in
Certain Circumstances..................................... 50
ARTICLE 8 DISCHARGE OF INDENTURE........................................... 51
SECTION 8.01 Termination of the Company's Obligations.................. 51
SECTION 8.02 Defeasance and Discharge of Indenture..................... 52
SECTION 8.03 Defeasance of Certain Obligations......................... 53
SECTION 8.04 Application of Trust Money................................ 53
SECTION 8.05 Reinstatement............................................. 54
SECTION 8.06 Defeasance and Certain Other Events of Default............ 54
SECTION 8.07 Repayment of the Company.................................. 54
SECTION 8.08 Conversion of Notes Upon Discharge........................ 54
ARTICLE 9 AMENDMENTS....................................................... 55
SECTION 9.01 Without Consent of Holders................................ 55
SECTION 9.02 With Consent of Holders................................... 56
SECTION 9.03 Compliance with Trust Indenture Act....................... 57
SECTION 9.04 Revocation and Effect of Consents, Waivers and Actions.... 57
SECTION 9.05 Notation on or Exchange of Notes.......................... 57
SECTION 9.06 Trustee to Sign Supplemental Indentures................... 57
SECTION 9.07 Effect of Supplemental Indentures......................... 57
ARTICLE 10 CONVERSION...................................................... 58
SECTION 10.01 Conversion Right and Conversion Price..................... 58
SECTION 10.02 Exercise of Conversion Right.............................. 58
SECTION 10.03 Fractions of Shares....................................... 59
SECTION 10.04 Adjustment of Conversion Price............................ 59
SECTION 10.05 Notice of Adjustments of Conversion Price................. 70
SECTION 10.06 Notice Prior to Certain Actions........................... 70
SECTION 10.07 Company to Reserve Common Stock........................... 71
SECTION 10.08 Taxes on Conversions...................................... 71
SECTION 10.09 Covenant as to Common Stock............................... 71
SECTION 10.10 Cancellation of Converted Notes........................... 72
SECTION 10.11 Effect of Reclassification, Consolidation, Merger or Sale. 72
SECTION 10.12 Responsibility of Trustee for Conversion Provisions....... 73
ARTICLE 11 SUBORDINATION................................................... 74
SECTION 11.01 Agreement to Subordinate.................................. 74
SECTION 11.02 Liquidation; Dissolution; Bankruptcy...................... 74
SECTION 11.03 Default on Designated Senior Indebtedness................. 74
SECTION 11.04 Acceleration of Notes..................................... 75
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SECTION 11.05 When Distribution Must Be Paid Over....................... 75
SECTION 11.06 Notice by the Company..................................... 76
SECTION 11.07 Subrogation............................................... 76
SECTION 11.08 Relative Rights........................................... 76
SECTION 11.09 Subordination May Not Be Impaired by the Company.......... 77
SECTION 11.10 Distribution or Notice to Representative.................. 77
SECTION 11.11 Rights of Trustee and Paying Agent........................ 77
ARTICLE 12 SECURITY........................................................ 78
SECTION 12.01 Security.................................................. 78
ARTICLE 13 MISCELLANEOUS................................................... 79
SECTION 13.01 Trust Indenture Act Controls.............................. 79
SECTION 13.02 Notices................................................... 79
SECTION 13.03 Communication by Holders with Other Holders............... 80
SECTION 13.04 Certificate and Opinion as to Conditions Precedent........ 80
SECTION 13.05 Statements Required in Certificate or Opinion............. 80
SECTION 13.06 Separability Clause....................................... 81
SECTION 13.07 Rules by Trustee, Paying Agent, Conversion Agent and
Registrar................................................. 81
SECTION 13.08 Legal Holidays............................................ 81
SECTION 13.09 GOVERNING LAW............................................. 81
SECTION 13.10 No Recourse Against Others................................ 81
SECTION 13.11 Successors................................................ 81
SECTION 13.12 Multiple Originals........................................ 82
EXHIBITS
Exhibit A-1 Form of Face of Global Note
Exhibit A-2 Form of Certificated Note
Exhibit B-1 Transfer Certificate
Exhibit B-2 Form of Letter to Be Delivered by Accredited Investors
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INDENTURE dated as of October 17, 2001 between REGENERON
PHARMACEUTICALS, INC., a New York corporation (the "Company"), and AMERICAN
STOCK TRANSFER & TRUST COMPANY, a New York corporation with trust powers, as
Trustee hereunder (the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its
5-1/2% Convertible Senior Subordinated Notes due 2008 (herein called the
"Notes") of substantially the tenor and amount hereinafter set forth, and to
provide therefor the Company has duly authorized the execution and delivery of
this Indenture.
All things necessary to make the Notes, when the Notes are executed
by the Company and authenticated and delivered hereunder, the valid obligations
of the Company, and to make this Indenture a valid agreement of the Company, in
accordance with their and its terms, have been done. Further, all things
necessary to duly authorize the issuance of the Common Stock of the Company
issuable upon the conversion of the Notes, and to duly reserve for issuance the
number of shares of Common Stock issuable upon such conversion, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Notes by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Notes, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01 Definitions. For all purposes of this Indenture, except
as otherwise expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP; and
(3) the words "herein", "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
"Adjusted Interest Rate" means, with respect to any Registration
Default, initially 5.75% but from and after the 91st day following the day on
which a Registration Default has occurred and is continuing it shall be
increased to 6.00%.
1
"Affiliate" of any specified person means any other person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For purposes of this definition, "control"
when used with respect to any specified person means the power to direct or
cause the direction of the management and policies of such person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Note or beneficial interest therein, the rules
and procedures of the Depositary for such Note, in each case to the extent
applicable to such transaction and as in effect from time to time.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of such board.
"Board Resolution" means a resolution duly adopted by the Board of
Directors, a copy of which, certified by the Secretary or an Assistant Secretary
of the Company to be in full force and effect on the date of such certification,
shall have been delivered to the Trustee.
"Business Day" means each day of the year other than a Saturday or a
Sunday on which banking institutions are not required or authorized to close in
the City of New York.
"Capital Stock" of any corporation means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) stock issued by that
corporation.
"Certificated Notes" means Notes that are in the form of the Notes
attached hereto as Exhibit A-2.
"Closing Price" of any security on any date of determination means:
(1) the closing sale price (or, if no closing sale price is
reported, the last reported sale price) of such security on the New York
Stock Exchange on such date;
(2) if such security is not listed for trading on the New York Stock
Exchange on any such date, the closing sale price as reported in the
composite transactions for the principal U.S. securities exchange on which
such security is so listed;
(3) if such security is not so listed on a U.S. national or regional
securities exchange, the closing bid price as reported by the NASDAQ Stock
Market;
(4) if such security is not so reported, the last quoted bid price
for such security in the over-the-counter market as reported by the
National Quotation Bureau or similar organization; or
2
(5) if such bid price is not available, the average of the mid-point
of the last bid and ask prices of such security on such date from at least
three nationally recognized independent investment banking firms retained
for this purpose by the Company.
"Common Stock" means the Common Stock, par value $0.001 per share,
of the Company authorized at the date of this instrument as originally executed,
excluding the Company's Class A Stock. Subject to the provisions of Section
10.11, shares issuable on conversion, redemption or repurchase of Notes shall
include only shares of Common Stock or shares of any class or classes of common
stock resulting from any reclassification or reclassifications thereof;
provided, however, that if at any time there shall be more than one such
resulting class, the shares so issuable on conversion of Notes shall include
shares of all such classes, and the shares of each such class then so issuable
shall be substantially in the proportion which the total number of shares of
such class resulting from all such reclassifications bears to the total number
of shares of all such classes resulting from all such reclassifications.
"common stock" means any stock of any class of Capital Stock which
has no preference in respect of dividends or of amounts payable in the event of
any voluntary or involuntary liquidation, dissolution or winding up of the
issuer.
"Company" means the party named as the "Company" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"Company Request" or "Company Order" means a written request or
order signed in the name of the Company by any two Officers.
"Conversion Agent" means any person authorized by the Company to
convert Notes in accordance with Article 10 hereof.
"Corporate Trust Office" means the principal office of the Trustee
at which at any time its corporate trust business shall be administered, which
office at the date hereof is located at 00 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx,
00000, or such other address as the Trustee may designate from time to time by
notice to the Holders and the Company, or the principal corporate trust office
of any successor Trustee (or such other address as a successor Trustee may
designate from time to time by notice to the Holders and the Company).
"Default" means any event which is, or after notice or passage of
time or both would be, an Event of Default.
"Designated Senior Indebtedness" means any Senior Indebtedness
which, at the time of determination, has an aggregate principal amount
outstanding of at least $25.0 million and that has been specifically designated
in the instrument evidencing such Senior Indebtedness as "Designated Senior
Indebtedness" of the Company.
"Dollar" or "U.S.$" means a dollar or other equivalent unit in such
coin or currency of the United States as at the time shall be legal tender for
the payment of public and private debts.
3
"Exchange Act" means the United States Securities Exchange Act of
1934 (or any successor statute), as amended from time to time.
"GAAP" means United States generally accepted accounting principles
as in effect from time to time.
"Global Notes" means Notes that are in the form of the Notes
attached hereto as Exhibit A-1, and to the extent that such Notes are required
to bear the Legend required by Section 2.06(f), such Notes will be in the form
of a 144A Global Note.
"Government Securities" means the direct obligations of, obligations
fully guaranteed by, or participations in pools consisting solely of obligations
of or obligations guaranteed by the United States of America for the payment of
which guarantee or obligations the full faith and credit of the United States of
America is pledged and which are not callable or redeemable at the option of the
issuer thereof.
"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.
"Holder" or "Noteholder" means a person in whose name a Note is
registered on the Registrar's books.
"Indebtedness" means, with respect to any person, without
duplication:
(a) all liabilities of such person for borrowed money (including
overdrafts) or for the deferred purchase price of property or services,
excluding any trade payables and other accrued current liabilities
incurred in the ordinary course of business, but including, without
limitation, all obligations, contingent or otherwise, of such person in
connection with any letters of credit and acceptances issued under letter
of credit facilities, acceptance facilities or other similar facilities;
(b) all obligations of such person evidenced by bonds, notes,
debentures or other similar instruments;
(c) indebtedness of such person created or arising under any
conditional sale or other title retention agreement with respect to
property acquired by such person (even if the rights and remedies of the
seller or lender under such agreement in the event of default are limited
to repossession or sale of such property), but excluding trade payables
arising in the ordinary course of business;
(d) all capitalized lease obligations of such person;
(e) all obligations of such person under or in respect of interest
rate agreements or currency agreements;
4
(f) all indebtedness referred to in (but not excluded from) the
preceding clauses of other persons and all dividends of other persons, the
payment of which is secured by (or for which the holder of such
indebtedness has an existing right, contingent or otherwise, to be secured
by) any Lien or with respect to property (including, without limitation,
accounts and contract rights) owned by such person, even though such
person has not assumed or become liable for the payment of such
indebtedness (the amount of such obligation being deemed to be the lesser
of the value of such property or asset or the amount of the obligation so
secured);
(g) all Guarantees by such person of indebtedness referred to in
this definition or of any other person;
(h) all Redeemable Capital Stock of such person valued at the
greater of its voluntary or involuntary maximum fixed repurchase price
plus accrued and unpaid dividends; and
(i) the present value of the obligation of such person as lessee for
net rental payments (excluding all amounts required to be paid on account
of maintenance and repairs, insurance, taxes, assessments, water,
utilities and similar charges to the extent included in such rental
payments) during the remaining term of the lease included in such sale and
leaseback transaction including any period for which such lease has been
extended or may, at the option of the lessor, be extended. Such present
value shall be calculated using a discount rate equal to the rate of
interest implicit in such transaction, determined in accordance with GAAP.
"Indenture" means this Indenture, as amended or supplemented from
time to time in accordance with the terms hereof, including the provisions of
the TIA that are deemed to be a part hereof.
"Institutional Accredited Investor" means an institutional
"accredited investor" as described in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Interest Payment Date" means the Stated Maturity of an installment
of interest on the Notes.
"Interest Rate" means 5-1/2% per annum.
"Issue Date" of any Note means the date on which the Note was
originally issued or deemed issued as set forth on the face of the Note.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset
given to secure Indebtedness, whether or not filed, recorded or otherwise
perfected under applicable law (including any conditional sale or other title
retention agreement, any lease in the nature thereof, any option or other
agreement to sell or give a security interest in and any filing of or agreement
to give any financing statement under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction with respect to any such lien, pledge, charge or
security interest).
5
"Notes" has the meaning ascribed to it in the first paragraph under
the caption "Recitals of the Company".
"Officer" means the Chairman of the Board, the Vice Chairman, the
Chief Executive Officer, the President, any Executive Vice President, any Senior
Vice President, any Vice President, the Treasurer or the Secretary or any
Assistant Treasurer or Assistant Secretary of the Company.
"Officers' Certificate" means a written certificate containing the
information specified in Sections 13.04 and 13.05, signed in the name of the
Company by any two Officers, and delivered to the Trustee. An Officers'
Certificate given pursuant to Section 4.03 shall be signed by an authorized
financial or accounting Officer of the Company but need not contain the
information specified in Sections 13.04 and 13.05.
"Optional Redemption" has the meaning specified in Section 3.02.
"Optional Redemption Date" means the date specified for Optional
Redemption of the Notes in accordance with the terms of the Notes and this
Indenture.
"144A Global Note" means a permanent Global Note in the form of the
Note attached hereto as Exhibit A-1, and that is deposited with and registered
in the name of the Depositary, representing Notes sold in reliance on Rule 144A
under the Securities Act.
"Opinion of Counsel" means a written opinion containing the
information specified in Sections 13.04 and 13.05, from legal counsel who is
acceptable to the Trustee and such acceptance shall not be unreasonably
withheld. The counsel may be an employee of, or counsel to, the Company or the
Trustee.
"Permitted Holders" shall mean (i) each of Xxxxxxx X. Xxxxxxxxx,
M.D., Ph.D. and X. Xxx Xxxxxxx, M.D., and their respective spouses, immediate
family members, estates, lineal descendants, executors or administrators, or
(ii) any trust, corporation or other entity, the beneficiaries, stockholders or
other persons beneficially holding an 80% or more controlling interest of which
consist of any persons or entities referred to in clause (i).
"Permitted Payments" shall mean payments on the Notes derived from
the Pledged Securities which are pledged for the benefit of the Holders of the
Notes in accordance with the terms and provisions of the Pledge Agreement.
"Permitted Junior Securities" shall mean any payment or distribution
in the form of equity securities or subordinated securities of the Company or
any successor obligor that, in the case of any such subordinated securities, are
subordinated in right of payment to all Senior Indebtedness that may at the time
be outstanding to at least the same extent as the Notes are so subordinated.
"person" or "Person" means any individual, corporation, limited
liability company, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, or government or any agency or political
subdivision thereof.
6
"Pledge Account" means an account established by the Trustee
pursuant to the terms of the Pledge Agreement for the deposit of the Pledged
Securities purchased by the Company with a portion of the proceeds from the sale
of the Notes.
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, made by the Company in favor of the Trustee, governing the disbursement
of funds from the Pledge Account, as such agreement may be amended, restated,
supplemented or otherwise modified from time to time.
"Pledged Securities" means the Government Securities to be purchased
by the Company and held in the Pledge Account in accordance with the Pledge
Agreement.
"principal" of a Note means the principal amount due on the Stated
Maturity as set forth on the face of the Note.
"Provisional Redemption" has the meaning specified in Section 3.01.
"Provisional Redemption Date" means the date specified for
Provisional Redemption of the Notes in accordance with the terms of the Notes
and this Indenture.
"Redeemable Capital Stock" means any class of the Company's Capital
Stock that, either by its terms, by the terms of any securities into which it is
convertible or exchangeable or by contract or otherwise, is, or upon the
happening of an event or passage of time would be, required to be redeemed
(whether by sinking fund or otherwise) prior to the date that is 91 days after
the final scheduled maturity of the Notes or is redeemable at the option of the
Holder thereof at any time prior to such date, or is convertible into or
exchangeable for debt securities at any time prior to such date (unless it is
convertible or exchangeable solely at the Company's option).
"Redemption Date" or "redemption date" means the date specified for
redemption of the Notes in accordance with the terms of the Notes and this
Indenture.
"Redemption Price" or "redemption price" when used with respect to
any security to be redeemed, means the price at which it is redeemed pursuant to
this Indenture.
"Registration Default" has the meaning given to such term in the
Registration Rights Agreement.
"Registration Rights Agreement" shall mean the registration rights
agreement dated the date hereof between the Company, Xxxxxxx Lynch, Xxxxxx,
Xxxxxx & Xxxxx Incorporated and Xxxxxxxxx Xxxxxxxx, Inc.
"Regular Record Date" means, with respect to the interest payable on
any Interest Payment Date, the close of business on April 2 or October 2
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
"Responsible Officer" means, when used with respect to the Trustee,
any officer within the corporate trust department of the Trustee, including any
vice president, assistant vice
7
president, assistant secretary, assistant treasurer, trust officer or any other
officer of the Trustee who customarily performs functions similar to those
performed by the Persons who at the time shall be such officers, respectively,
or to whom any corporate trust matter is referred because of such person's
knowledge of and familiarity with the particular subject.
"Restricted Note" means a Note required to bear the restrictive
legend set forth in the form of Note set forth in Exhibits A-1 and A-2 of this
Indenture.
"Rule 144A" means Rule 144A under the Securities Act (or any
successor provision), as it may be amended from time to time.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the United States Securities Act of 1933 (or
any successor statute), as amended from time to time.
"Senior Indebtedness" means:
(a) all obligations of the Company, now or hereafter existing, under
or in respect of the documents and instruments executed in connection
therewith, whether for principal, premium, if any, interest (including
interest accruing after the filing of, or which would have accrued but for
the filing of, a petition by or against the Company under bankruptcy law,
whether or not such interest is allowed as a claim after such filing in
any proceeding under such law) and other amounts due in connection
therewith (including, without limitation, any fees, premiums, expenses,
reimbursement obligations with respect to letters of credit and
indemnities), whether outstanding on the date of this Indenture or
thereafter created, incurred or assumed; and
(b) the principal of, premium, if any, and interest on all other
Indebtedness of the Company (other than the Notes), whether outstanding on
the date of this Indenture or thereafter created, incurred or assumed,
unless, in the case of any particular Indebtedness, the instrument
creating or evidencing the same or pursuant to which the same is
outstanding expressly provides that such Indebtedness shall not be senior
in right of payment to the Notes.
Notwithstanding the foregoing, "Senior Indebtedness" shall not
include:
(c) Indebtedness evidenced by the Notes;
(d) Indebtedness of the Company that is expressly subordinated in
right of payment to Senior Indebtedness;
(e) Indebtedness of the Company that by operation of law is
subordinate to any general unsecured obligations of the Company;
(f) any liability for federal, state or local taxes or other taxes,
owed or owing by the Company;
8
(g) accounts payable or other liabilities owed or owing by the
Company to trade creditors (including guarantees thereof or instruments
evidencing such liabilities);
(h) amounts owed by the Company for compensation to employees or for
services rendered to the Company;
(i) Indebtedness of the Company to any Subsidiary or any other
Affiliate of the Company or any of such affiliate's subsidiaries;
(j) Capital Stock of the Company;
(k) Indebtedness evidenced by any guarantee of any Indebtedness
ranking equal or junior in right of payment to the Notes; and
(l) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of Title 11 of the United States Code, is
without recourse to the Company.
"Significant Subsidiary" means a Subsidiary of the Company,
including its Subsidiaries, which meets any of the following conditions:
(m) the Company's and its other Subsidiaries' investments in and
advances to the Subsidiary exceed 10 percent of the total assets of the
Company and its Subsidiaries consolidated as of the end of any two of the
three most recently completed fiscal years; or
(n) the Company's and its other Subsidiaries' proportionate share of
the total assets of the Subsidiary exceeds 10 percent of the total assets
of the Company and its Subsidiaries consolidated as of the end of any two
of the three most recently completed fiscal years; or
(o) the Company's and its other Subsidiaries' equity in the income
from continuing operations before income taxes, extraordinary items and
cumulative effect of a change in accounting principles of the Subsidiary
exceeds 10 percent of such income of the Company and its Subsidiaries
consolidated as of the end of any two of the three most recently completed
fiscal years.
"Stated Maturity" when used with respect to any Note or any
installment of interest thereon, means the date specified in such Note as the
fixed date on which the principal of such Note or such installment of interest
is due and payable.
"Subsidiary" means (i) a corporation, a majority of whose Capital
Stock with voting power, under ordinary circumstances, to elect directors is, at
the date of determination, directly or indirectly owned by the Company, by one
or more Subsidiaries of the Company or by the Company and one or more
Subsidiaries of the Company, (ii) a partnership in which the Company or a
Subsidiary of the Company holds a majority interest in the equity capital or
profits of such partnership, or (iii) any other person (other than a
corporation) in which the Company, a Subsidiary of the Company or the Company
and one or more Subsidiaries of the Company, directly or indirectly, at the date
of determination, has (x) at least a majority ownership interest
9
or (y) the power to elect or direct the election of a majority of the directors
or other governing body of such person.
"TIA" means the Trust Indenture Act of 1939 as in effect on the date
of this Indenture, provided, however, that in the event the TIA is amended after
such date, TIA means, to the extent required by any such amendment, the TIA as
so amended.
"Trading Day" means a day during which trading in Notes generally
occurs on the New York Stock Exchange or, if the Common Stock is not listed on
the New York Stock Exchange, on the principal other national or regional
securities exchange on which the Common Stock is then listed or, if the Common
Stock is not listed on a national or regional securities exchange, on the
National Association of Notes Dealers Automated Quotation System or, if the
Common Stock is not quoted on the National Association of Securities Dealers
Automated Quotation System, on the principal other market on which the Common
Stock is then traded.
"Trustee" means the party named as the "Trustee" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"United States" means the United States of America (including the
States and the District of Columbia), its territories, its possessions and other
areas subject to its jurisdiction (its "possessions" including Puerto Rico, the
U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana
Islands).
"U.S. Government Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof at any time prior
to the Stated Maturity of the Notes, and shall also include depository receipts
issued by a bank or trust company as custodian with respect to any such U.S.
Government Obligation or a specific payment of interest on or principal of any
such U.S. Government Obligation held by such custodian for the account of the
holder of a depository receipt; provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or the specific payment of interest on
or principal of the U.S. Government Obligation evidenced by such depository
receipt.
10
SECTION 1.02 Other Definitions.
Defined in
Term Section
---- -------
"Act"................................................. 1.05(a)
"Agent Members"....................................... 2.12(f)
"Bankruptcy Law"...................................... 6.01
"Change of Control"................................... 3.08(a)
"Change of Control Repurchase Date"................... 3.08(a)
"Change of Control Repurchase Notice"................. 3.08(d)
"Change of Control Repurchase Price".................. 3.08(a)
"Conversion Price".................................... 10.01
"Current Market Price"................................ 10.04(g)
"Custodian"........................................... 6.01
"Depositary".......................................... 2.01(a)
"DTC"................................................. 2.01(a)
"Event of Default".................................... 6.01
"Exchange Act"........................................ 3.08(a)
"excluded securities"................................. 10.04(d)
"Expiration Time"..................................... 10.04(f)
"fair market value"................................... 10.04(g)
"Institutional Accredited Investors".................. 2.01(b)
"Legal Holiday"....................................... 12.08
"Legend".............................................. 2.06(f)
"Non-Electing Share".................................. 10.11
"Non-Payment Default"................................. 11.03(b)
"Notice of Default"................................... 6.01
"Paying Agent"........................................ 2.03
"Payment Blockage Period"............................. 11.03(b)
"Payment Default"..................................... 11.03(a)
"Purchased Shares".................................... 10.04(f)
"Permitted Junior Securities" ........................ 11.02
"QIB"................................................. 2.01(a)
"Record Date"......................................... 10.04(g)
"Reference Period".................................... 10.04(d)
"Registrar"........................................... 2.03
"Rule 144A Information"............................... 4.06
"Trigger Event"....................................... 10.04(d)
SECTION 1.03 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture Notes" means the Notes.
"indenture Note holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
11
"obligor" on the indenture Notes means the Company.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
SECTION 1.04 Rules of Construction. Unless the context otherwise
requires:
(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 generally accepted accounting principles
as in effect from time to time;
(c) "or" is not exclusive;
(d) "including" means including, without limitation; and
(e) words in the singular include the plural, and words in the
plural include the singular.
SECTION 1.05 Acts of Holders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such Holders
in person or by their agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and conclusive in favor of the
Trustee and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to such officer the execution thereof.
Where such execution is by a signer acting in a capacity other than such
signer's individual capacity, such certificate or affidavit shall also
constitute sufficient proof of such signer's authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient.
The ownership of Notes shall be proved by the register for the Notes
or by a certificate of the Registrar.
Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Note shall bind every future Holder of
the same Note and the holder of
12
every Note issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustee or the Company in reliance thereon, whether or not
notation of such action is made upon such Note.
If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at its option, by or pursuant to a resolution of the Board of Directors, fix in
advance a record date for the determination of Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other Act,
but the Company shall have no obligation to do so. If such a record date is
fixed, such request, demand, authorization, direction, notice, consent, waiver
or other Act may be given before or after such record date, but only the Holders
of record at the close of business on such record date shall be deemed to be
Holders for purposes of determining whether Holders of the requisite proportion
of outstanding Notes have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other Act, and for
that purpose the outstanding Notes shall be computed as of such record date;
provided that no such authorization, agreement or consent by the Holders on such
record date shall be deemed effective unless it shall become effective pursuant
to the provisions of this Indenture not later than six months after the record
date.
ARTICLE 2
THE NOTES
SECTION 2.01 Form and Dating. The Notes and the Trustee's
certificate of authentication to be borne by such Notes shall be substantially
in the form annexed hereto as Exhibits A-1 and A-2, which are incorporated in
and made a part of this Indenture. The terms and provisions contained in the
form of Note shall constitute, and are hereby expressly made, a part of this
Indenture and to the extent applicable, the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
Any of the Notes may have such letters, numbers or other marks of
identification and such notations, legends and endorsements as the officers
executing the same may approve (execution thereof to be conclusive evidence of
such approval) and as are not inconsistent with the provisions of this
Indenture, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
securities exchange or automated quotation system on which the notes may be
listed or designated for issuance, or to conform to usage.
(a) 144A Global Notes. Notes offered and sold within the United
States to qualified institutional investors as defined in Rule 144A ("QIBs") in
reliance on Rule 144A shall be issued, initially in the form of one or more 144A
Global Notes, which shall be deposited with the Trustee at its Corporate Trust
Office, as custodian for the Depositary and registered in the name of The
Depository Trust Company ("DTC") or the nominee thereof (such depositary, or any
successor thereto, and any such nominee being hereinafter referred to as the
"Depositary"), duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The aggregate principal amount of the 144A Global Notes
may from time to time be increased or
13
decreased by adjustments made on the records of the Trustee and the Depositary
as hereinafter provided.
(b) Certificated Notes. Notes not issued as interests in the Global
Notes will be issued in certificated form substantially in the form of Exhibit
A-2 attached hereto. Except as provided in this Section 2.01, 2.06 or 2.12,
owners of beneficial interests in Global Notes will not be entitled to receive
physical delivery of Certificated Notes. Notes offered and sold within the
United States to institutional accredited investors as defined in Rule
501(a)(1), (2), (3) and (7) under the Securities Act ("Institutional Accredited
Investors") shall be issued, initially in the form of a Certificated Note, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided.
(c) Global Notes in General. Each Global Note shall represent such
of the outstanding Notes as shall be specified therein and each shall provide
that it shall represent the aggregate amount of outstanding Notes from time to
time endorsed thereon and that the aggregate amount of outstanding Notes
represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and conversions.
Any adjustment of the aggregate principal amount of a Global Note to
reflect the amount of any increase or decrease in the amount of outstanding
Notes represented thereby shall be made by the Trustee in accordance with
instructions given by the Holder thereof as required by Section 2.12 hereof and
shall be made on the records of the Trustee and the Depositary.
(d) Book-Entry Provisions. This Section 2.01(d) shall apply only to
Global Notes deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.01(d), authenticate and deliver initially one or more Global
Notes that (a) shall be registered in the name of the Depositary, (b) shall be
delivered by the Trustee to the Depositary or pursuant to the Depositary's
instructions and (c) shall bear legends substantially to the following effect:
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF THE
14
DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE
TWO OF THE INDENTURE REFERRED TO ON THE REVERSE HEREOF."
SECTION 2.02 Execution and Authentication. The Notes shall be
executed on behalf of the Company by any Officer, under its corporate seal
reproduced thereon. The signature of the Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signatures of individuals who
were at the time of the execution of the Notes the proper Officers of the
Company shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and delivery
of such Notes or did not hold such offices at the date of authentication of such
Notes.
No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Note a
certificate of authentication substantially in the form provided for herein duly
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Note shall be conclusive evidence, and the only evidence,
that such Note has been duly authenticated and delivered hereunder.
The Trustee shall authenticate and deliver Notes for original issue
in an aggregate principal amount of up to $250,000,000 upon a Company Order
without any further action by the Company. The aggregate principal amount of
Notes outstanding at any time may not exceed the amount set forth in the
foregoing sentence, except as provided in Section 2.07.
The Notes shall be issued only in registered form without coupons
and only in denominations of $1,000 in principal amount and any integral
multiple thereof.
SECTION 2.03 Registrar, Paying Agent and Conversion Agent. The
Company shall maintain an office or agency where Notes may be presented for
registration of transfer or for exchange ("Registrar"), an office or agency
where Notes may be presented for purchase or payment ("Paying Agent") and an
office or agency where Notes may be presented for conversion ("Conversion
Agent"). The Registrar shall keep a register of the Notes and of their transfer
and exchange. The Company may have one or more co-registrars, one or more
additional paying agents and one or more additional conversion agents. The term
Paying Agent includes any additional paying agent, including any named pursuant
to Section 4.05. The term Conversion Agent includes any additional conversion
agent, including any named pursuant to Section 4.05.
The Company shall enter into an appropriate agency agreement with
any Registrar, Paying Agent, Conversion Agent or co-registrar (other than the
Trustee). The agreement shall implement the provisions of this Indenture that
relate to such agent. The Company shall notify the Trustee of the name and
address of any such agent. If the Company fails to maintain a Registrar, Paying
Agent or Conversion Agent, the Trustee shall act as such and shall be entitled
to appropriate compensation therefor pursuant to Section 7.06. The
15
Company or any Subsidiary or an Affiliate of either of them may act as Paying
Agent, Registrar, Conversion Agent or co-registrar.
The Company initially appoints the Trustee as Registrar, Conversion
Agent and Paying Agent in connection with the Notes.
SECTION 2.04 Paying Agent to Hold Money and Notes in Trust. Except
as otherwise provided herein, on or prior to each due date of payments in
respect of any Note, the Company shall deposit with the Paying Agent a sum of
money (in immediately available funds if deposited on the due date) or Common
Stock (pursuant to Section 3.10 hereof) sufficient to make such payments when so
becoming due. The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Noteholders or the Trustee all money and Common Stock held by the
Paying Agent for the making of payments in respect of the Notes and shall notify
the Trustee of any default by the Company in making any such payment. At any
time during the continuance of any such default, the Paying Agent shall, upon
the written request of the Trustee, forthwith pay to the Trustee all money and
Common Stock so held in trust. If the Company, a Subsidiary or an Affiliate of
either of them acts as Paying Agent, it shall segregate the money and Common
Stock held by it as Paying Agent and hold it as a separate trust fund. The
Company at any time may require a Paying Agent to pay all money and Common Stock
held by it to the Trustee and to account for any funds and Common Stock
disbursed by it. Upon doing so, the Paying Agent shall have no further liability
for the money or Common Stock.
SECTION 2.05 Noteholder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Noteholders. If the Trustee is not the Registrar,
the Company shall cause to be furnished to the Trustee at least semiannually on
April 2 and October 2 a listing of Noteholders dated within 15 days of the date
on which the list is furnished and at such other times as the Trustee may
request in writing a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of Noteholders.
SECTION 2.06 Transfer and Exchange. Subject to Section 2.12 hereof,
(a) upon surrender for registration of transfer of any Note, together with a
written instrument of transfer satisfactory to the Registrar duly executed by
the Noteholder or such Noteholder's attorney duly authorized in writing, at the
office or agency of the company designated as Registrar or co-registrar pursuant
to Section 2.03, the Company shall execute, and the Trustee shall authenticate
and deliver, in the name of the designated transferee or transferees, one or
more new Notes of any authorized denomination or denominations, of a like
aggregate principal amount. The Company shall not charge a service charge for
any registration of transfer or exchange, but the Company may require payment of
a sum sufficient to pay all taxes, assessments or other governmental charges
that may be imposed in connection with the transfer or exchange of the Notes
from the Noteholder requesting such transfer or exchange.
At the option of the Holder, Notes may be exchanged for other Notes
of any authorized denomination or denominations, of a like aggregate principal
amount, upon surrender of the Notes to be exchanged, together with a written
instrument of transfer satisfactory to the Registrar duly executed by the
Noteholder or such Noteholder's attorney duly authorized in
16
writing, at such office or agency. Whenever any Notes are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Notes which the Holder making the exchange is entitled to receive.
The Company shall not be required to make, and the Registrar need
not register, transfers or exchanges of Notes selected for redemption (except,
in the case of Notes to be redeemed in part, the portion thereof not to be
redeemed) or any Notes in respect of which a Change of Control Repurchase Notice
(as defined in Section 3.08(d)) has been given and not withdrawn by the Holder
thereof in accordance with the terms of this Indenture (except, in the case of
Notes to be purchased in part, the portion thereof not to be purchased) or any
Notes for a period of 15 days before the mailing of a notice of redemption of
Notes to be redeemed.
(b) Notwithstanding any provision to the contrary herein, so long as
a Global Note remains outstanding and is held by or on behalf of the Depositary,
transfers of a Global Note, in whole or in part, shall be made only in
accordance with Section 2.12 and this Section 2.06(b). Transfers of a Global
Note shall be limited to transfers of such Global Note in whole, or in part, to
nominees of the Depositary or to a successor of the Depositary or such
successor's nominee.
(c) Successive registrations and registrations of transfers and
exchanges as aforesaid may be made from time to time as desired, and each such
registration shall be noted on the register for the Notes.
(d) Any Registrar appointed pursuant to Section 2.03 hereof shall
provide to the Trustee such information as the Trustee may reasonably require in
connection with the delivery by such Registrar of Notes upon transfer or
exchange of Notes.
(e) No Registrar shall be required to make registrations of transfer
or exchange of Notes during any periods designated in the text of the Notes or
in this Indenture as periods during which such registration of transfers and
exchanges need not be made.
(f) If Notes are issued upon the transfer, exchange or replacement
of Notes subject to restrictions on transfer and bearing the legends set forth
on the form of Note attached hereto as Exhibits A-1 and A-2 setting forth such
restrictions (collectively, the "Legend"), or if a request is made to remove the
Legend on a Note, the Notes so issued shall bear the Legend, or the Legend shall
not be removed, as the case may be, unless there is delivered to the Company and
the Registrar such satisfactory evidence, which shall include an Opinion of
Counsel, as may be reasonably required by the Company and the Registrar, that
neither the Legend nor the restrictions on transfer set forth therein are
required to ensure that transfers thereof comply with the provisions of Rule
144A or Rule 144 under the Securities Act or that such Notes are not
"restricted" within the meaning of Rule 144 under the Securities Act. Upon (i)
provision of such satisfactory evidence, or (ii) notification by the Company to
the Trustee and Registrar of the sale of such Note pursuant to a registration
statement that is effective at the time of such sale, the Trustee, at the
written direction of the Company, shall authenticate and deliver a Note that
does not bear the Legend. If the Legend is removed from the face of a Note and
the Note is subsequently held by an Affiliate of the Company, the Legend shall
be reinstated.
17
SECTION 2.07 Replacement Notes. If (a) any mutilated Note is
surrendered to the Trustee, or (b) the Company and the Trustee receive evidence
to their satisfaction of the destruction, loss or theft of any Note, and there
is delivered to the Company and the Trustee such Note or indemnity as may be
required by them to save each of them harmless, then, in the absence of notice
to the Company or the Trustee that such Note has been acquired by a bona fide
purchaser, the Company shall execute and upon its written request the Trustee
shall authenticate and deliver, in exchange for any such mutilated Note or in
lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and
principal amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Note has
become or is about to become due and payable, or is about to be purchased by the
Company pursuant to Article 3 hereof, the Company in its discretion may, instead
of issuing a new Note, pay or purchase such Note, as the case may be.
Upon the issuance of any new Notes under this Section 2.07, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section 2.07 in lieu of any
mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Note shall be at any time enforceable by anyone, and shall be
entitled to all benefits of this Indenture equally and proportionately with any
and all other Notes duly issued hereunder.
The provisions of this Section 2.07 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.08 Outstanding Notes; Determinations of Holders' Action.
Notes outstanding at any time are all the Notes authenticated by the Trustee
except for those cancelled by it or delivered to it for cancellation, those paid
pursuant to Section 2.07 and those described in this Section 2.08 as not
outstanding. A Note does not cease to be outstanding because the Company or an
Affiliate thereof holds the Note; provided, however, that in determining whether
the Holders of the requisite principal amount of the outstanding Notes have
given or concurred in any request, demand, authorization, direction, notice,
consent or waiver hereunder, Notes owned by the Company or any other obligor
upon the Notes or any Affiliate of the Company or such other obligor shall be
disregarded and deemed not to be outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes which a
Responsible Officer of the Trustee knows to be so owned shall be so disregarded.
Subject to the foregoing, only Notes outstanding at the time of such
determination shall be considered in any such determination (including, without
limitation, determinations pursuant to Articles 6 and 9).
18
If a Note is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture, on a
Redemption Date, or on the Business Day following the Change of Control
Repurchase Date, or on Stated Maturity, money or securities, if permitted
hereunder, sufficient to pay Notes payable on that date, then immediately after
such Redemption Date, Change of Control Repurchase Date or Stated Maturity, as
the case may be, such Notes shall cease to be outstanding and interest on such
Notes shall cease to accrue; provided that, if such Notes are to be redeemed,
notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made.
If a Note is converted in accordance with Article 10, then from and
after the time of conversion on the conversion date, such Note shall cease to be
outstanding and interest shall cease to accrue on such Note.
SECTION 2.09 Temporary Notes. Pending the preparation of definitive
Notes, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Notes which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Notes in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Notes may determine, as conclusively
evidenced by their execution of such Notes.
If temporary Notes are issued, the Company will cause definitive
Notes to be prepared without unreasonable delay. After the preparation of
definitive Notes, the temporary Notes shall be exchangeable for definitive Notes
upon surrender of the temporary Notes at the office or agency of the Company
designated for such purpose pursuant to Section 2.03, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Notes the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a like principal amount of definitive Notes of authorized
denominations. Until so exchanged the temporary Notes shall in all respects be
entitled to the same benefits under this Indenture as definitive Notes.
SECTION 2.10 Cancellation. All Notes surrendered for payment,
purchase by the Company pursuant to Article 3, conversion, redemption or
registration of transfer or exchange shall, if surrendered to any person other
than the Trustee, be delivered to the Trustee and shall be promptly cancelled by
it. The Company may at any time deliver to the Trustee for cancellation any
Notes previously authenticated and delivered hereunder which the Company may
have acquired in any manner whatsoever, and all Notes so delivered shall be
promptly cancelled by the Trustee. The Company may not issue new Notes to
replace Notes it has paid or delivered to the Trustee for cancellation or that
any Holder has converted pursuant to Article 10. No Notes shall be authenticated
in lieu of or in exchange for any Notes cancelled as provided in this Section
2.10, except as expressly permitted by this Indenture. All cancelled Notes held
by the Trustee shall be destroyed by the Trustee and the Trustee shall deliver a
certificate of destruction to the Company.
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SECTION 2.11 Persons Deemed Owners. Prior to due presentment of a
Note for registration of transfer, the Company, the Trustee and any agent of the
Company or the Trustee may treat the Person in whose name such Note is
registered as the owner of such Note for the purpose of receiving payment of
principal of the Note or the payment of any Redemption Price or Change of
Control Repurchase Price in respect thereof, and interest thereon, for the
purpose of conversion and for all other purposes whatsoever, whether or not such
Note be overdue, and neither the Company, the Trustee nor any agent of the
Company or the Trustee shall be affected by notice to the contrary.
SECTION 2.12 Global Notes. (a) Notwithstanding any other provisions
of this Indenture or the Notes, (A) transfers of a Global Note, in whole or in
part, shall be made only in accordance with Section 2.06 and Section 2.12(a)(i),
(B) transfer of a beneficial interest in a Global Note for a Certificated Note
shall comply with Section 2.06 and Section 2.12(a)(ii) below, and (C) transfers
of a Certificated Note shall comply with Section 2.06 and Section 2.12(a)(iii)
and (iv) below.
(i) Transfer of Global Note. A Global Note may not be transferred,
in whole or in part, to any Person other than the Depositary or a nominee
or any successor thereof, and no such transfer to any such other Person
may be registered; provided that this clause (i) shall not prohibit any
transfer of a Note that is issued in exchange for a Global Note but is not
itself a Global Note. No transfer of a Note to any Person shall be
effective under this Indenture or the Notes unless and until such Note has
been registered in the name of such Person. Nothing in this Section
2.12(a)(i) shall prohibit or render ineffective any transfer of a
beneficial interest in a Global Note effected in accordance with the other
provisions of this Section 2.12(a).
(ii) Restrictions on Transfer of a Beneficial Interest in a Global
Note for a Certificated Note. A beneficial interest in a Global Note may
not be exchanged for a Certificated Note except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a transfer of
a beneficial interest in a Global Note in accordance with Applicable
Procedures for a Certificated Note in the form satisfactory to the
Trustee, together with:
(a) so long as the Notes are Restricted Notes, certification,
in the form set forth in Exhibit B-1, and, if requested by the
Company or the Registrar, certification in the form set forth in
Exhibit B-2, that such beneficial interest in the Global Note is
being transferred to an Institutional Accredited Investor;
(b) written instructions to the Trustee to make, or direct the
Registrar to make, an adjustment on its books and records with
respect to such Global Note to reflect a decrease in the aggregate
principal amount of the Notes represented by the Global Note, such
instructions to contain information regarding the Depositary account
to be credited with such decrease; and
(c) if the Company or Registrar so requests, an opinion of
counsel or other evidence reasonably satisfactory to them as to the
compliance with the restrictions set forth in the Legend,
20
then the Trustee shall cause, or direct the Registrar to cause, in
accordance with the standing instructions and procedures existing between
the Depositary and the Registrar, the aggregate principal amount of Notes
represented by the Global Note to be decreased by the aggregate principal
amount of the Certificated Note to be issued, shall issue such
Certificated Note and shall debit or cause to be debited to the account of
the Person specified in such instructions a beneficial interest in the
Global Note equal to the principal amount of the Certificated Note so
issued.
(iii) Transfer and Exchange of Certificated Notes. When Certificated
Notes are presented to the Registrar with a request:
(x) to register the transfer of such Certificated Notes; or
(y) to exchange such Certificated Notes for an equal principal
amount of Certificated Notes of other authorized denominations,
the Registrar shall register the transfer or make the exchange as
requested if its reasonable requirements for such transaction are met;
provided, however, that the Certificated Notes surrendered for transfer or
exchange:
(a) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the
Company and the Registrar, duly executed by the Holder thereof or
his attorney duly authorized in writing; and
(b) so long as such Notes are Restricted Notes, such Notes are
being transferred or exchanged pursuant to an effective registration
statement under the Securities Act or pursuant to clause (A), (B) or
(C) below, and are accompanied by the following additional
information and documents, as applicable:
(A) if such Certificated Notes are being delivered to
the Registrar by a Holder for registration in the name of such
Holder, without transfer, a certification from such Holder to
that effect; or
(B) if such Certificated Notes are being transferred to
the Company, a certification to that effect; or
(C) if such Certificated Notes are being transferred
pursuant to an exemption from registration, (i) a
certification to that effect (in the form set forth in
Exhibits B-1 and B-2, if applicable) and (ii) if the Company
or Registrar so requests, an opinion of counsel or other
evidence reasonably satisfactory to them as to the compliance
with the restrictions set forth in the Legend.
(iv) Restrictions on Transfer of a Certificated Note for a
Beneficial Interest in a Global Note. A Certificated Note may not be
exchanged for a beneficial interest in a Global Note except upon
satisfaction of the requirements set forth below.
21
Upon receipt by the Trustee of a Certificated Note, duly endorsed or
accompanied by appropriate instruments of transfer, in form satisfactory
to the Trustee, together with:
(a) so long as the Notes are Restricted Notes, certification,
in the form set forth in Exhibit B-1, that such Certificated Note is
being transferred to a Qualified Institutional Buyer in accordance
with Rule 144A; and
(b) written instructions directing the Trustee to make, or to
direct the Registrar to make, an adjustment on its books and records
with respect to such Global Note to reflect an increase in the
aggregate principal amount of the Notes represented by the Global
Note, such instructions to contain information regarding the
Depositary account to be credited with such increase, then the
Trustee shall cancel such Certificated Note and cause, or direct the
Registrar to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Registrar, the
aggregate principal amount of Notes represented by the Global Note
to be increased by the aggregate principal amount of the
Certificated Note to be exchanged, and shall credit or cause to be
credited to the account of the Person specified in such instructions
a beneficial interest in the Global Note equal to the principal
amount of the Certificated Note so cancelled. If no Global Notes are
then outstanding, the Company shall issue and the Trustee shall
authenticate, upon written order of the Company in the form of an
Officers' Certificate, a new Global Note in the appropriate
principal amount.
(c) Subject to the succeeding paragraph, every Note shall be subject
to the restrictions on transfer provided in the Legend including the delivery of
an opinion of counsel, if so provided. Whenever any Restricted Note is presented
or surrendered for registration of transfer or for exchange for a Note
registered in a name other than that of the Holder, such Note must be
accompanied by a certificate in substantially the form set forth in Exhibit B-1,
dated the date of such surrender and signed by the Holder of such Note, as to
compliance with such restrictions on transfer. The Registrar shall not be
required to accept for such registration of transfer or exchange any Note not so
accompanied by a properly completed certificate.
(d) The restrictions imposed by the Legend upon the transferability
of any Note shall cease and terminate when such Note has been sold pursuant to
an effective registration statement under the Securities Act or transferred in
compliance with Rule 144 under the Securities Act (or any successor provision
thereto) or, if earlier, upon the expiration of the holding period applicable to
sales thereof under Rule 144(k) under the Securities Act (or any successor
provision). Any Note as to which such restrictions on transfer shall have
expired in accordance with their terms or shall have terminated may, upon a
surrender of such Note for exchange to the Registrar in accordance with the
provisions of this Section 2.12 (accompanied, in the event that such
restrictions on transfer have terminated by reason of a transfer in compliance
with Rule 144 or any successor provision, by an opinion of counsel having
substantial experience in practice under the Securities Act and otherwise
reasonably acceptable to the Company, addressed to the Company and in form
acceptable to the Company, to the effect that the transfer of such Note has been
made in compliance with Rule 144 or such successor provision), be exchanged for
a new Note, of like tenor and aggregate principal amount, which shall not bear
the restrictive Legend. The Company shall inform the Trustee of the effective
date
22
of any registration statement registering the Notes under the Securities Act.
The Trustee shall not be liable for any action taken or omitted to be taken by
it in good faith in accordance with the aforementioned opinion of counsel or
registration statement.
(e) As used in the preceding two paragraphs of this Section 2.12,
the term "transfer" encompasses any sale, pledge, transfer, hypothecation or
other disposition of any Note.
(f) The provisions of clauses (1), (2), (3) and (4) below shall
apply only to Global Notes:
(1) Notwithstanding any other provisions of this Indenture or the
Notes, except as provided in Section 2.12(a)(ii), a Global Note shall not
be exchanged in whole or in part for a Note registered in the name of any
Person other than the Depositary or one or more nominees thereof, provided
that a Global Note may be exchanged for Notes registered in the names of
any person designated by the Depositary in the event that (i) the
Depositary has notified the Company that it is unwilling or unable to
continue as Depositary for such Global Note or such Depositary has ceased
to be a "clearing agency" registered under the Exchange Act, and a
successor Depositary is not appointed by the Company within 90 days or
(ii) an Event of Default has occurred and is continuing with respect to
the Notes. Any Global Note exchanged pursuant to clause (i) above shall be
so exchanged in whole and not in part, and any Global Note exchanged
pursuant to clause (ii) above may be exchanged in whole or from time to
time in part as directed by the Depositary. Any Note issued in exchange
for a Global Note or any portion thereof shall be a Global Note; provided
that any such Note so issued that is registered in the name of a Person
other than the Depositary or a nominee thereof shall not be a Global Note.
(2) Notes issued in exchange for a Global Note or any portion
thereof shall be issued in definitive, fully registered form, without
interest coupons, shall have an aggregate principal amount equal to that
of such Global Note or portion thereof to be so exchanged, shall be
registered in such names and be in such authorized denominations as the
Depositary shall designate and shall bear the applicable legends provided
for herein. Any Global Note to be exchanged in whole shall be surrendered
by the Depositary to the Trustee, as Registrar. With regard to any Global
Note to be exchanged in part, either such Global Note shall be so
surrendered for exchange or, if the Trustee is acting as custodian for the
Depositary or its nominee with respect to such Global Note, the principal
amount thereof shall be reduced, by an amount equal to the portion thereof
to be so exchanged, by means of an appropriate adjustment made on the
records of the Trustee. Upon any such surrender or adjustment, the Trustee
shall authenticate and deliver the Note issuable on such exchange to or
upon the order of the Depositary or an authorized representative thereof.
(3) Subject to the provisions of clause (5) below, the registered
Holder may grant proxies and otherwise authorize any Person, including
Agent Members (as defined below) and persons that may hold interests
through Agent Members, to take any action which a holder is entitled to
take under this Indenture or the Notes.
23
(4) In the event of the occurrence of any of the events specified in
clause (1) above, the Company will promptly make available to the Trustee
a reasonable supply of Certificated Notes in definitive, fully registered
form, without interest coupons.
(5) Neither any members of, or participants in, the Depositary
(collectively, the "Agent Members") nor any other Persons on whose behalf
Agent Members may act shall have any rights under this Indenture with
respect to any Global Note registered in the name of the Depositary or any
nominee thereof, or under any such Global Note, and the Depositary or such
nominee, as the case may be, may be treated by the Company, the Trustee
and any agent of the Company or the Trustee as the absolute owner and
holder of such Global 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
such nominee, as the case may be, or impair, as between the Depositary,
its Agent Members and any other person on whose behalf an Agent Member may
act, the operation of customary practices of such Persons governing the
exercise of the rights of a holder of any Note.
SECTION 2.13 CUSIP Numbers. The Company in issuing the Notes may use
"CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use
"CUSIP" numbers in notices of redemption as a convenience to Holders; provided
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Notes or as contained in
any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the CUSIP numbers.
SECTION 2.14 Defaulted Interest. If the Company defaults in a
payment of interest on the Notes, it shall pay, or shall deposit with the Paying
Agent money in immediately available funds sufficient to pay, the defaulted
interest, plus (to the extent lawful) any interest payable on the defaulted
interest, to the Persons who are Holders on a subsequent special record date. A
special record date, as used in this Section 2.14 with respect to the payment of
any defaulted interest, shall mean the 15th day next preceding the date fixed by
the Company for the payment of defaulted interest, whether or not such day is a
Business Day. At least 15 days before the subsequent special record date, the
Company shall mail to each Holder and to the Trustee a notice that states the
subsequent special record date, the payment date and the amount of defaulted
interest to be paid.
ARTICLE 3
REDEMPTION AND PURCHASES
SECTION 3.01 Provisional Redemption. Any time prior to October 17,
2004, the Company may, at its option, redeem the Notes in whole or in part on
any date from time to time, upon notice as set forth in Section 3.05, at a
redemption price equal to $1,000 per $1,000 principal amount of the Notes
redeemed plus accrued and unpaid interest, if any (such amount, together with
the Make-Whole Payment described below, the "Provisional Redemption
24
Price"), to but excluding the date of redemption (the "Provisional Redemption
Date") if (i) the Closing Price of the Common Stock has exceeded 150% of the
Conversion Price (as defined in Article 10 and as such may be adjusted from time
to time) then in effect for at least 20 Trading Days in any consecutive
30-Trading Day period ending on the Trading Day prior to the date of mailing of
the provisional notice of redemption pursuant to Section 3.05 (the "Notice
Date") and (ii) during the period that the Company is obligated, under the
Registration Rights Agreement, to keep a registration statement covering resales
of the Notes and the Common Stock issuable upon conversion thereof effective,
such registration statement is effective (the "Registration Period") and
available for use as of, and including, the Notice Date through and including
the Provisional Redemption Date provided that this date is within the
Registration Period (such redemption, a "Provisional Redemption").
Upon any such Provisional Redemption, the Company shall make an
additional payment (the "Make-Whole Payment") in cash with respect to the Notes
called for redemption to Holders on the Notice Date in an amount equal to $165
per $1,000 principal amount of the Notes less the amount of any interest
actually paid on such Notes prior to or on the Provisional Redemption Date. The
Company shall make the Make-Whole Payment on all Notes called for Provisional
Redemption, including those Notes converted into Common Stock between the Notice
Date and the Provisional Redemption Date.
SECTION 3.02 Optional Redemption. Except as set forth under Section
3.01, the Notes are not redeemable prior to October 17, 2004. On and after
October 17, 2004, the Company may, at its option, redeem the Notes in whole at
any time or in part from time to time, on any date prior to maturity, upon
notice as set forth in Section 3.05, at a redemption price equal to $1,000 per
$1,000 principal amount (the "Optional Redemption Price"), plus any interest
accrued but not paid prior to the date of redemption (the "Optional Redemption
Date"), subject to the right of Holders of record on the immediately preceding
Regular Record Date to receive the interest due on the succeeding Interest
Payment Date if the Closing Price of the Common Stock has exceeded 140% of the
Conversion Price (as defined in Article 10 and as such may be adjusted from time
to time) then in effect for at least 20 Trading Days in any consecutive
30-Trading Day period ending on the Trading Day prior to the date of mailing of
the notice of optional redemption pursuant to Section 3.05.
SECTION 3.03 Notice of Trustee. If the Company elects to redeem
Notes pursuant to the redemption provisions of Section 3.01 or Section 3.02
hereof, it shall notify the Trustee at least 30 days prior but not more than 60
days prior to the Redemption Date of such intended Redemption Date, the
principal amount of Notes to be redeemed and the CUSIP numbers of the Notes to
be redeemed.
SECTION 3.04 Selection of Notes to be Redeemed. If fewer than all
the Notes are to be redeemed, the Trustee shall select the particular Notes to
be redeemed from the Outstanding Notes by a method that complies with the
requirements of any exchange on which the Notes are listed, or, if the Notes are
not listed on an exchange, on a pro rata basis or by lot or in accordance with
any other method of Trustee considers fair and appropriate. Notes and portions
thereof that the Trustee selects shall be in principal amounts equal to $1,000
or any whole multiple thereof.
25
If any Note selected for partial redemption is converted in part
before termination of the conversion right with respect to the portion of the
Note so selected, the converted portion of such Note shall be deemed to be the
portion selected for redemption (provided, however, that the Holder of such Note
so converted and deemed redeemed shall not be entitled to any additional
interest payment as a result of such deemed redemption than such Holder would
have otherwise been entitled to receive upon conversion of such Note). Notes
which have been converted during a selection of Notes to be redeemed may be
treated by the Trustee as Outstanding for the purpose of such selection.
The Trustee shall promptly notify the Company and the Registrar in
writing of the Notes selected for redemption and, in the case of any Notes
selected for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Notes shall relate, in
the case of any Notes redeemed or to be redeemed only in part, to the portion of
the principal amount of such Notes which has been or is to be redeemed.
SECTION 3.05 Notice of Redemption. Notice of redemption shall be
given in the manner provided in Section 13.02 hereof to the Holders of Notes to
be redeemed. Such notice shall be given not less than 30 nor more than 60 days
prior to the Redemption Date for redemption pursuant to Section 3.01 or Section
3.02.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price and interest accrued and unpaid to the
Redemption Date, if any, and, with respect to Notes called for Provisional
Redemption, the Make-Whole Payment;
(3) if fewer than all the outstanding Notes are to be redeemed, the
aggregate principal amount of Notes to be redeemed and the aggregate
principal amount of Notes which will be outstanding after such partial
redemption;
(4) that on the Redemption Date the Redemption Price and interest
accrued and unpaid to the Redemption Date, if any, and, with respect to
Notes called for Provisional Redemption, the Make-Whole Payment, will
become due and payable upon each such Note to be redeemed, and that
interest thereon shall cease to accrue on and after such date;
(5) the Conversion Price, the date on which the right to convert the
principal of the Notes to be redeemed will terminate and the places where
such Notes may be surrendered for conversion;
(6) the place or places where such Notes are to be surrendered for
payment of the Redemption Price and accrued and unpaid interest, if any;
and
26
(7) the CUSIP number of the Notes.
The notice given shall specify the last date on which exchanges or
transfers of Notes may be made pursuant to Section 2.06 hereof, and shall
specify the serial numbers of Notes and the portions thereof called for
redemption.
Notice of redemption of Notes to be redeemed at the election of the
Company shall be given by the Company.
SECTION 3.06 Effect of Notice of Redemption. Notice of redemption
having been given as provided in Section 3.05 hereof, the Notes so to be
redeemed shall, on the Redemption Date, become due and payable at the Redemption
Price therein specified and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued and unpaid interest)
such Notes shall cease to bear interest. Upon surrender of any such Note for
redemption in accordance with such notice, such Note shall be paid by the
Company at the Redemption Price plus accrued and unpaid interest, if any;
provided, however, that the installments of interest on Notes whose Stated
Maturity is prior to or on the Redemption Date shall be payable to the Holders
of such Notes, or one or more Predecessor Notes, registered as such on the
relevant Record Date according to their terms and the provisions of Section 2.01
hereof and, with respect to a Provisional Redemption, the Holder on the Notice
Date of any Note converted into Common Stock between the Notice Date and the
Provisional Redemption Date shall have the right to receive the Make-Whole
Payment regardless of the conversion of such Note.
If any Note called for redemption shall not be so paid upon
surrender thereof for redemption, the principal and premium, if any, shall,
until paid, bear interest from the Redemption Date at the Interest Rate.
SECTION 3.07 Deposit of Redemption Price. Prior to or on any
Redemption Date, the Company shall deposit with the Trustee or with a Paying
Agent an amount of money sufficient to pay the Redemption Price of all the Notes
to be redeemed on that Redemption Date (including, with respect to a Provisional
Redemption, Make-Whole Payments due on the Provisional Redemption Date with
respect to the Notes), other than any Notes called for redemption on that date
which have been converted prior to the date of such deposit (except with respect
to a Provisional Redemption as provided in Sections 3.01 and 3.06 hereof), and
accrued and unpaid interest, if any, on such Notes.
If any Note called for redemption is converted, any money deposited
with the Trustee or with a Paying Agent or so segregated and held in trust for
the redemption of such Note shall (subject to any right of the Holder of such
Note or any Predecessor Note to receive interest as provided in Section 4.01
hereof or Make-Whole Payments as provided in Section 3.01) be paid to the
Company on a Company Request or, if then held by the Company, shall be
discharged from such trust.
SECTION 3.08 Notes Redeemed in Part. Any Note which is to be
redeemed only in part shall be surrendered at an office or agency of the Company
designated for that purpose pursuant to Section 4.05 hereof (with, if the
Company or the Trustee so requires,
27
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or the Holder's
attorney duly authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Note without
service charge, a new Note or Notes of any authorized denomination as requested
by such Holder in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Note so surrendered.
SECTION 3.09 Conversion Arrangement on Call for Redemption. In
connection with any redemption of Notes, the Company may arrange for the
purchase and conversion of any Notes called for redemption by an agreement with
one or more investment banks or other purchasers to purchase such Notes by
paying to the Trustee in trust for the Noteholders, on or prior to 10:00 a.m.
New York City time on the Redemption Date, an amount that, together with any
amounts deposited with the Trustee by the Company for the redemption of such
Notes, is not less than the Redemption Price of such Notes. Notwithstanding
anything to the contrary contained in this Article 3, the obligation of the
Company to pay the Redemption Price of such Notes shall be deemed to be
satisfied and discharged to the extent such amount is so paid by such
purchasers. If such an agreement is entered into, any Notes not duly surrendered
for conversion by the Holders thereof may, at the option of the Company, be
deemed, to the fullest extent permitted by law, acquired by such purchasers from
such Holders and (notwithstanding anything to the contrary contained in Article
10) surrendered by such purchasers for conversion, all as of immediately prior
to the close of business on the Redemption Date, subject to payment of the above
amount as aforesaid. The Trustee shall hold and pay to the Holders whose Notes
are selected for redemption any such amount paid to it for purchase and
conversion in the same manner as it would moneys deposited with it by the
Company for the redemption of Notes. Without the Trustee's prior written
consent, no arrangement between the Company and such purchasers for the purchase
and conversion of any Notes shall increase or otherwise affect any of the
powers, duties, responsibilities or obligations of the Trustee as set forth in
this Indenture, and the Company agrees to indemnify the Trustee from, and hold
it harmless against, any loss, liability or expense arising out of or in
connection with any such arrangement for the purchase and conversion of any
Notes between the Company and such purchasers, including the costs and expenses
incurred by the Trustee in the defense of any claim or liability arising out of
or in connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
SECTION 3.10 Repurchase of Notes at Option of the Holder upon Change
of Control. (a) If there shall have occurred a Change of Control, all or any
portion of the Notes of any Holder equal to $1,000 or a whole multiple of
$1,000, not previously called for redemption, shall be repurchased by the
Company, at the option of such Holder, at a repurchase price equal to 100% of
the principal amount of the Notes to be repurchased, together with interest
accrued and unpaid to, but excluding, the repurchase date (the "Change of
Control Repurchase Price"), on the date (the "Change of Control Repurchase
Date") that is 30 days after the Change of Control Repurchase Notice; provided,
however, that installments of interest on Notes whose Stated Maturity is prior
to or on the Change of Control Repurchase Date shall be payable to the Holders
of such Notes, or one or more predecessor Notes, registered as such on the
relevant Regular Record Date according to their terms. Such right to require the
repurchase of the Notes shall not continue after a discharge of the Company from
its obligations with respect
28
to the Notes in accordance with Article 8, unless a Change of Control shall have
occurred prior to such discharge.
Subject to the fulfillment by the Company of the conditions set
forth in this Section 3.10(b), the Company may elect to pay the Change of
Control Repurchase Price by delivering the number of shares of Common Stock
equal to (i) the Change of Control Repurchase Price divided by (ii) 95% of the
average of the Closing Prices per share of Common Stock for the five consecutive
Trading Days ending on the third Trading Day prior to the Change of Control
Repurchase Date.
Whenever in this Indenture (including Sections 2.01, 6.01(a) and
6.07 hereof) or Exhibit A-1 annexed hereto there is a reference, in any context,
to the principal of any Note as of any time, such reference shall be deemed to
include reference to the Change of Control Repurchase Price payable in respect
to such Note to the extent that such Change of Control Repurchase Price is, was
or would be so payable at such time, and express mention of the Change of
Control Repurchase Price in any provision of this Indenture shall not be
construed as excluding the Change of Control Repurchase Price in those
provisions of this Indenture when such express mention is not made; provided,
however, that, for the purposes of Article 11 hereof, such reference shall be
deemed to include reference to the Change of Control Repurchase Price only to
the extent the Change of Control Repurchase Price is payable in cash.
A "Change of Control" of the Company shall be deemed to have
occurred at such time as either of the following events shall occur:
(i) the acquisition by any person, including any syndicate or group
deemed to be a "person" under Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), (other than Permitted
Holders) of beneficial ownership, directly or indirectly, through a
purchase, merger or other acquisition transaction or series of
transactions of shares of the Capital Stock of the Company entitling that
person to exercise 50% or more of the total voting power of all shares of
Capital Stock entitled to vote generally in elections of directors, other
than any acquisition by the Company, any of its subsidiaries or any of the
employee benefit plans;
(ii) any Permitted Holder files a schedule, form or report in
connection with a transaction or event disclosing that such person has
become the beneficial owner of 50% or more of the total voting power of
all shares of Capital Stock entitled to vote generally in elections of
directors, as a result of which (i) the Common Stock ceases (or, upon
consummation of or immediately following such transaction or event, will
cease) to be listed on a United States national securities exchange or
approved for quotation on the Nasdaq National Market or any similar United
States system for automated dissemination of quotations of securities
prices or (ii) less than 5 million shares of the Company's Common Stock
remain held by persons other than Permitted Holders; or
(iii) any consolidation or merger of the Company with or into any
other person, any merger of another person into the Company, or any
conveyance, transfer, sale, lease or other disposition of all or
substantially all of the Company's properties and assets to another
person, other than:
29
(A) any transaction pursuant to which holders of the Capital
Stock immediately prior to the transaction have the entitlement to
exercise, directly or indirectly, 50% or more of the total voting
power of all shares of the Capital Stock entitled to vote generally
in the election of directors of the continuing or surviving person
immediately after the transaction; and
(B) any merger solely for the purpose of changing the
Company's jurisdiction of incorporation and resulting in a
reclassification, conversion or exchange of outstanding shares of
Common Stock solely into shares of Common Stock of the surviving
entity.
(b) The following are conditions to the Company's election to pay
for the Change of Control Repurchase Price in Common Stock:
(i) The shares of Common Stock to be issued upon repurchase of Notes
hereunder:
(A) shall not require registration under any federal
securities law before such shares may be freely transferable without
being subject to any transfer restrictions under the Securities Act
upon repurchase or, if such registration is required, such
registration shall be completed and shall become effective prior to
the Change of Control Repurchase Date; and
(B) shall not require registration with, or approval of, any
governmental authority under any state law or any other federal law
before shares may be validly issued or delivered upon repurchase or
if such registration is required or such approval must be obtained,
such registration shall be completed or such approval shall be
obtained prior to the Change of Control Repurchase Date.
(ii) The shares of Common Stock to be listed upon repurchase of
Notes hereunder are, or shall have been, approved for listing on the
Nasdaq National Market or the New York Stock Exchange or listed on another
national securities exchange, in any case, prior to the Change of Control
Repurchase Date.
(iii) All shares of Common Stock which may be issued upon repurchase
of Notes will be issued out of the Company's authorized but unissued
Common Stock and will, upon issue, be duly and validly issued and fully
paid and nonassessable and free of any preemptive or similar rights.
(iv) If any of the conditions set forth in clauses (i) through (iii)
of this Section 3.10(b) are not satisfied in accordance with the terms
thereof, the Change of Control Repurchase Price shall be paid by the
Company only in cash.
(c) Unless the Company shall have theretofore called for redemption
all of the outstanding Notes, prior to or on the 30th day after the occurrence
of a Change of Control, the Company, or, at the written request and expense of
the Company, the Trustee, shall give to all Noteholders, in the manner provided
in Section 13.02 hereof, notice of the occurrence of the Change of Control and
of the repurchase right set forth herein arising as a result thereof. If the
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Trustee is requested to give such notice the Company will provide the written
request at least 1 day prior. The Company shall also deliver a copy of such
notice of a repurchase right to the Trustee. The notice shall include a form of
Change of Control Repurchase Notice (as defined in Section 3.10(d)) to be
completed by the Noteholder and shall state:
(1) briefly, the events causing a Change of Control and the date of
such Change of Control;
(2) the date by which the Change of Control Repurchase Notice
pursuant to this Section 3.10 must be given;
(3) the Change of Control Repurchase Date;
(4) the Change of Control Repurchase Price and the form of payment;
(5) the name and address of the Paying Agent and the Conversion
Agent;
(6) the Conversion Price and any adjustments thereto;
(7) that Notes as to which a Change of Control Repurchase Notice has
been given may be converted pursuant to Article 10 hereof only if the
Change of Control Repurchase Notice has been withdrawn in accordance with
the terms of this Indenture;
(8) that Notes must be surrendered to the Paying Agent to collect
payment;
(9) that the Change of Control Repurchase Price for any Note as to
which a Change of Control Repurchase Notice has been duly given and not
withdrawn will be paid promptly following the later of the Change of
Control Repurchase Date and the time of surrender of such Note as
described in (8) above;
(10) briefly, the procedures the Holder must follow to exercise
rights under this Section 3.10;
(11) briefly, the conversion rights of the Notes;
(12) the procedures for withdrawing a Change of Control Repurchase
Notice;
(13) that, unless the Company defaults in making payment of such
Redemption Price, interest on Notes called for redemption will cease to
accrue on and after the Redemption Date; and
(14) the CUSIP number of the Notes.
(d) A Holder may exercise its rights specified in Section 3.10(a)
hereof upon delivery of a written notice of purchase (a "Change of Control
Repurchase Notice") to the Paying Agent at any time prior to the close of
business on the Change of Control Repurchase Date, stating:
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(1) the certificate number of the Note which the Holder will deliver
to be purchased;
(2) the portion of the principal amount of the Note which the Holder
will deliver to be purchased, which portion must be $1,000 or an integral
multiple thereof; and
(3) that such Note shall be purchased pursuant to the terms and
conditions specified in paragraph 6 of the Notes.
The delivery of such Note to the Paying Agent prior to, on or after
the Change of Control Repurchase Date (together with all necessary endorsements)
at the offices of the Paying Agent shall be a condition to the receipt by the
Holder of the Change of Control Repurchase Price therefor; provided, however,
that such Change of Control Repurchase Price shall be so paid pursuant to this
Section 3.10 only if the Note so delivered to the Paying Agent shall conform in
all respects to the description thereof set forth in the related Change of
Control Repurchase Notice.
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.10, a portion of a Note if the principal amount of such portion is
$1,000 or an integral multiple of $1,000. Provisions of this Indenture that
apply to the purchase of all of a Note also apply to the purchase of such
portion of such Note.
Any purchase by the Company contemplated pursuant to the provisions
of this Section 3.10 shall be consummated by the delivery of the consideration
to be received by the Holder promptly following the later of the Change of
Control Repurchase Date and the time of delivery of the Note to the Paying Agent
in accordance with this Section 3.10.
Notwithstanding anything herein to the contrary, any Holder
delivering to the Paying Agent the Change of Control Repurchase Notice
contemplated by this Section 3.10(d) shall have the right to withdraw such
Change of Control Repurchase Notice at any time prior to the close of business
on the Change of Control Repurchase Date by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.11.
The Paying Agent shall promptly notify the Company of the receipt by
it of any Change of Control Repurchase Notice or written withdrawal thereof.
SECTION 3.11 Effect of Change of Control Repurchase Notice. Upon
receipt by the Paying Agent of the Change of Control Repurchase Notice specified
in Section 3.10(d), the Holder of the Note in respect of which such Change of
Control Repurchase Notice was given shall (unless such Change of Control
Repurchase Notice is withdrawn as specified in the following two paragraphs)
thereafter be entitled to receive solely the Change of Control Repurchase Price
with respect to such Note. Such Change of Control Repurchase Price shall be paid
to such Holder, subject to receipts of funds and/or Notes by the Paying Agent,
promptly following the later of (x) the Change of Control Repurchase Date with
respect to such Note (provided the conditions in Section 3.10(d) have been
satisfied) and (y) the time of delivery of such Note to the Paying Agent by the
Holder thereof in the manner required by Section 3.10(d). Notes in respect of
which a Change of Control Repurchase Notice, has been given by the Holder
thereof may not be converted pursuant to Article 10 hereof on or after the date
of the delivery of
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such Change of Control Repurchase Notice unless such Change of Control
Repurchase Notice has first been validly withdrawn as specified in the following
two paragraphs.
A Change of Control Repurchase Notice may be withdrawn by means of a
written notice of withdrawal delivered to the office of the Paying Agent in
accordance with the Change of Control Repurchase Notice at any time prior to the
close of business on the Change of Control Repurchase Date specifying:
(1) the certificate number of the Note in respect of which such
notice of withdrawal is being submitted,
(2) the principal amount of the Note with respect to which such
notice of withdrawal is being submitted, and
(3) the principal amount, if any, of such Note which remains subject
to the original Change of Control Repurchase Notice and which has been or
will be delivered for purchase by the Company.
There shall be no repurchase of any Notes pursuant to Section 3.10
if there has occurred (prior to, on or after, as the case may be, the giving, by
the Holders of such Notes, of the required Change of Control Repurchase Notice)
and is continuing an Event of Default (other than a default in the payment of
the Change of Control Repurchase Price with respect to such Notes). The Paying
Agent will promptly return to the respective Holders thereof any Notes (x) with
respect to which a Change of Control Repurchase Notice has been withdrawn in
compliance with this Indenture, or (y) held by it during the continuance of an
Event of Default (other than a default in the payment of the Change of Control
Repurchase Price with respect to such Notes) in which case, upon such return,
the Change of Control Repurchase Notice with respect thereto shall be deemed to
have been withdrawn.
SECTION 3.12 Deposit of Change of Control Repurchase Price. Prior to
10:00 a.m. (New York City time) on the Business Day following the Change of
Control Repurchase Date the Company shall deposit with the Trustee or with the
Paying Agent (or, if the Company or a Subsidiary or an Affiliate of either of
them is acting as the Paying Agent, shall segregate and hold in trust as
provided in Section 2.04) an amount of money (in immediately available funds if
deposited on such Business Day) or Common Stock, if permitted hereunder,
sufficient to pay the aggregate Change of Control Repurchase Price of all the
Notes or portions thereof which are to be purchased as of the Change of Control
Repurchase Date.
SECTION 3.13 Notes Purchased in Part. Any Note which is to be
purchased only in part shall be surrendered at the office of the Paying Agent
(with, if the Company or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or such Xxxxxx's attorney duly
authorized in writing) and the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of such Note, without service charge, a
new Note or Notes, of any authorized denomination as requested by such Holder in
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Note so surrendered which is not purchased.
33
SECTION 3.14 Covenant to Comply with Securities Laws upon Purchase
of Notes. In connection with any offer to purchase or repurchase Notes under
Section 3.10 hereof (provided that such offer or purchase constitutes an "issuer
tender offer" for purposes of Rule 13e-4 (which term, as used herein, includes
any successor provision thereto) under the Exchange Act at the time of such
offer or purchase), the Company shall (i) comply with Rule 13e-4, Rule 14e-1 and
any other tender offer rules under the Exchange Act which may then be
applicable, (ii) file the related Schedule 13E-3 (or any successor schedule,
form or report) or any other schedule required under the Exchange Act, and (iii)
otherwise comply with all federal and state securities laws so as to permit the
rights and obligations under Section 3.10 to be exercised in the time and in the
manner specified in Section 3.10.
SECTION 3.15 Repayment to the Company. The Trustee and the Paying
Agent shall return to the Company any cash or shares of Common Stock that remain
unclaimed as provided in paragraph 12 of the Notes, together with interest or
dividends, if any, thereon, held by them for the payment of the Change of
Control Repurchase Price; provided, however, that to the extent that the
aggregate amount of cash or shares of Common Stock deposited by the Company
pursuant to Section 3.12 exceeds the aggregate Change of Control Repurchase
Price of the Notes or portions thereof which the Company is obligated to
purchase as of the Change of Control Repurchase Date then promptly after the
Business Day following the Change of Control Repurchase Date the Trustee shall
return any such excess to the Company together with interest or dividends, if
any, thereon.
ARTICLE 4
COVENANTS
SECTION 4.01 Payment of Principal, Premium, Interest on the Notes.
The Company will duly and punctually pay the principal of and premium, if any,
and interest in respect of the Notes in accordance with the terms of the Notes
and this Indenture. The Company will deposit or cause to be deposited with the
Trustee as directed by the Trustee, no later than the day of the Stated Maturity
of any Note or installment of interest, all payments so due. Principal amount,
Redemption Price, Change of Control Repurchase Price, and cash interest shall be
considered paid on the applicable date due if on such date (or, in the case of a
Change of Control Repurchase Price on the Business Day following the applicable
Change of Control Repurchase Date) the Trustee or the Paying Agent holds, in
accordance with this Indenture, money or Notes, if permitted hereunder,
sufficient to pay all such amounts then due.
The Company shall, to the extent permitted by law, pay cash interest
on overdue amounts at the rate per annum set forth in paragraph 1 of the Notes,
compounded semiannually, which interest shall accrue from the date such overdue
amount was originally due to the date payment of such amount, including interest
thereon, has been made or duly provided for. All such interest shall be payable
on demand.
SECTION 4.02 SEC and Other Reports. The Company shall file with the
Trustee, within 15 days after it files such annual and quarterly reports,
information, documents and other reports with the SEC, copies of its annual
report and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the SEC may by rules and
34
regulations prescribe) which the Company is required to file with the SEC
pursuant to Section 13 or 15(d) of the Exchange Act. In such event, such reports
shall be provided at the times the Company would have been required to provide
reports had it continued to have been subject to such reporting requirements.
The Company also shall comply with the other provisions of TIA Section 314(a).
SECTION 4.03 Compliance Certificate. The Company shall deliver to
the Trustee within 120 days after the end of each fiscal year of the Company
(beginning with the fiscal year ending on December 31, 2001) an Officer's
Certificate, stating whether or not to the best knowledge of the signer thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
SECTION 4.04 Further Instruments and Acts. Upon request of the
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
SECTION 4.05 Maintenance of Office or Agency. The Company will
maintain in the Borough of Manhattan, the City of New York, an office or agency
of the Trustee, Registrar, Paying Agent and Conversion Agent where Notes may be
presented or surrendered for payment, where Notes may be surrendered for
registration of transfer, exchange, purchase, redemption or conversion and where
notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served. The office of American Stock Transfer & Trust Company,
located at 00 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, xxxxxxxxx: Corporate Trust
Department, shall initially be such office or agency for all of the aforesaid
purposes. The Company shall give prompt written notice to the Trustee of the
location, and of any change in the location, of any such office or agency (other
than a change in the location of the office of the Trustee). If at any time the
Company shall fail to maintain any such required office or agency or shall fail
to furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the address of the Trustee set
forth in Section 13.02.
The Company may also from time to time designate one or more other
offices or agencies where the Notes may be presented or surrendered for any or
all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York, for such purposes.
SECTION 4.06 Delivery of Certain Information. At any time when the
Company is not subject to Section 13 or 15(d) of the Exchange Act, upon the
request of a holder or any beneficial holder of Notes or shares of Common Stock
issued upon conversion thereof, the Company will promptly furnish or cause to be
furnished Rule 144A Information (as defined below) to such Holder or any
beneficial holder of Notes or holder of shares of Common Stock issued upon
conversion of Notes, or to a prospective purchaser of any such security
designated by any such holder, as the case may be, to the extent required to
permit compliance by such Holder or holder with Rule 144A under the Securities
Act in connection with the resale of any
35
such security. "Rule 144A Information" shall be such information as is specified
pursuant to Rule 144A(d)(4) under the Securities Act.
SECTION 4.07 Subordination. The Company shall not and will not
permit its subsidiaries or other business units to incur, create, assume,
guarantee or in any other manner become directly or indirectly liable with
respect to or responsible for, or permit to remain outstanding (other than if
required by law), any Indebtedness that is subordinated or junior in right of
payment to Senior Indebtedness unless such Indebtedness ranks equal or junior in
right of payment to the Notes. It being understood that the Company shall have
the right to incur, create, assume or guarantee or in any other manner become
directly or indirectly liable with respect to or responsible for, or permit to
remain outstanding Senior Indebtedness that may be subordinate to other Senior
Indebtedness.
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01 When Company May Merge or Transfer Assets. The Company
shall not consolidate with, merge with or into any other person or convey,
transfer or lease its properties and assets substantially as an entirety to any
person, unless:
(a) either (1) the Company shall be the continuing corporation or
(2) the person (if other than the Company) formed by such consolidation or into
which the Company is merged or the person which acquires by conveyance, transfer
or lease the properties and assets of the Company substantially as an entirety
(i) shall be organized and validly existing under the laws of the United States
or any State thereof or the District of Columbia and (ii) shall expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Trustee, in form reasonably satisfactory to the Trustee, all of the obligations
of the Company under the Notes and this Indenture;
(b) at the time of such transaction, no Event of Default and no
event which, after notice or lapse of time, would become an Event of Default,
shall have happened and be continuing; and
(c) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, conveyance, transfer or lease and, if a supplemental indenture is
required in connection with such transaction, such supplemental indenture,
comply with this Article 5 and that all conditions precedent herein provided for
relating to such transaction have been satisfied.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise) of the properties and assets of one or more Subsidiaries
(other than to the Company or another Subsidiary), which, if such assets were
owned by the Company, would constitute all or substantially all of the
properties and assets of the Company, shall be deemed to be the transfer of all
or substantially all of the properties and assets of the Company.
36
The successor person formed by such consolidation or into which the
Company is merged or the successor person to which such conveyance, transfer or
lease is made shall succeed to, and be substituted for, and may exercise every
right and power of, the Company under this Indenture with the same effect as if
such successor had been named as the Company herein; and thereafter, except in
the case of a lease and obligations the Company may have under a supplemental
indenture pursuant to Section 10.11, the Company shall be discharged from all
obligations and covenants under this Indenture and the Notes. Subject to Section
9.06, the Company, the Trustee and the successor person shall enter into a
supplemental indenture to evidence the succession and substitution of such
successor person and such discharge and release of the Company.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default. An "Event of Default" occurs if:
(1) the Company fails to pay when due the principal of or premium,
if any, on any of the Notes at maturity, upon redemption or exercise of a
repurchase right or otherwise, whether or not such payment is prohibited
by Article 11 of this Indenture;
(2) the Company fails to pay an installment of interest (including
liquidated damages, if any) on any of the Notes that continues for 30 days
after the date when due, whether or not such payment is prohibited by
Article 11 of this Indenture, provided that a failure to make any of the
first six scheduled interest payments on the Notes within three Business
Days after an Interest Payment Date will constitute an Event of Default
with no additional grace or cure period;
(3) the Company fails to deliver shares of Common Stock, together
with cash in lieu of fractional shares, when such Common Stock or cash in
lieu of fractional shares is required to be delivered upon conversion of a
Note or upon exercise of a repurchase right pursuant to Section 3.10 and
such failure continues for 10 days after such delivery date;
(4) the Company fails to perform or observe any other term, covenant
or agreement contained in the Notes or this Indenture for a period of 60
days after receipt by the Company of a Notice of Default (as defined in
this Section 6.01);
(5) (A) one or more defaults in the payment of principal of or
premium, if any, on any of the Company's Indebtedness aggregating $10.0
million or more, when the same becomes due and payable at the scheduled
maturity thereof, and such default or defaults shall have continued after
any applicable grace period and shall not have been cured or waived within
a 30-day period after the date of such default or (B) any of the Company's
Indebtedness aggregating $10.0 million or more shall have been accelerated
or otherwise declared due and payable, or required to be prepaid or
repurchased (other than by regularly scheduled required prepayment) prior
to the scheduled maturity thereof and such acceleration is not rescinded
or annulled within a 30-day period after the date of such acceleration;
37
(6) the Company, or any Significant Subsidiary pursuant to or under
or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding;
(B) consents to the entry of an order for relief against it in
an involuntary case or proceeding or the commencement of any case
against it;
(C) consents to the appointment of a Custodian of it or for
any substantial part of its property;
(D) makes a general assignment for the benefit of its
creditors;
(E) files a petition in bankruptcy or answer or consent
seeking reorganization or relief; or
(F) consents to the filing of such a petition or the
appointment of or taking possession by a Custodian; and
(7) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary in an involuntary case or proceeding, or adjudicates the
Company or any Significant Subsidiary insolvent or bankrupt;
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its or their properties;
or
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 days.
"Bankruptcy Law" means Title 11, United States Code, or any
similar federal or state law for the relief of debtors.
"Custodian" means any receiver, trustee, assignee, liquidator,
custodian or similar official under any Bankruptcy Law.
(8) the Pledge Agreement shall cease to be in full force and effect
or enforceable in accordance with its terms.
A Default under clause (4) above is not an Event of Default until
the Trustee notifies the Company, or the Holders of at least 25% in aggregate
principal amount of the Notes at the time outstanding notify the Company and the
Trustee, of the Default and the Company does not cure such Default (and such
Default is not waived) within the time specified in clause
38
(4) above after actual receipt of such notice. Any such notice must specify the
Default, demand that it be remedied and state that such notice is a "Notice of
Default".
The Company will deliver to the Trustee, within five Business Days
of becoming aware of the occurrence of an Event of Default, written notice
thereof. In addition, the Company shall deliver to the Trustee, within 30 days
after it becomes aware of the occurrence thereof, written notice of any event
which with the lapse of time would become an Event of Default under clause (4)
above, its status and what action the Company is taking or proposes to take with
respect thereto.
SECTION 6.02 Acceleration. If an Event of Default (other than an
Event of Default specified in Section 6.01(6) or (7)) occurs and is continuing,
the Trustee by Notice to the Company, or the Holders of at least 25% in
aggregate principal amount of the Notes at the time outstanding by notice to the
Company and the Trustee, may declare the notes due and payable at their
principal amount together with accrued and unpaid interest. Upon a declaration
of acceleration, such principal and accrued and unpaid interest to the date of
payment shall be immediately due and payable.
If an Event of Default specified in Section 6.01(6) or (7) above
occurs and is continuing, then the principal and the interest on all the Notes
shall become and be immediately due and payable without any declaration or other
act on the part of the Trustee or any Noteholders.
The Holders of a majority in aggregate principal amount of the Notes
at the time outstanding, by notice to the Trustee (and without notice to any
other Noteholder) may rescind or annul an acceleration and its consequences if
the rescission would not conflict with any judgment or decree and if all
existing Events of Default have been cured or waived except nonpayment of the
principal and any accrued cash interest that have become due solely as a result
of acceleration and if all amounts due to the Trustee under Section 7.06 have
been paid. No such rescission shall affect any subsequent Default or impair any
right consequent thereto.
SECTION 6.03 Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of the principal, the premium, if any, and any accrued cash interest on the
Notes or to enforce the performance of any provision of the Notes or this
Indenture.
The Trustee may maintain a proceeding even if the Trustee does not
possess any of the Notes or produce any of the Notes 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. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04 Waiver of Past Defaults. The Holders of a majority in
aggregate principal amount of the Notes at the time outstanding, by notice to
the Trustee (and without notice to any other Noteholder), may waive an existing
Default and its consequences except (1) an Event of Default described in Section
6.01(1) or (2), (2) a Default in respect of a provision that under Section 9.02
cannot be amended without the consent of each Noteholder
39
affected or (3) a Default which consists of a failure to convert any Note in
accordance with the terms of Article 11. When a Default is waived, it is deemed
cured, but no such waiver shall extend to any subsequent or other Default or
impair any consequent right. This Section 6.04 shall be in lieu of Section
316(a)1(B) of the TIA and such Section 316(a)1(B) is hereby expressly excluded
from this Indenture, as permitted by the TIA.
SECTION 6.05 Control by Majority. The Holders of a majority in
aggregate principal amount of the Notes at the time outstanding may direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or of exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that conflicts with law
or this Indenture or that the Trustee determines in good faith is unduly
prejudicial to the rights of other Noteholders or would involve the Trustee in
personal liability unless the Trustee is offered indemnity satisfactory to it
against loss, liability or expense. This Section 6.05 shall be in lieu of
Section 316(a)1(A) of the TIA and such Section 316(a)1(A) is hereby expressly
excluded from this Indenture, as permitted by the TIA.
SECTION 6.06 Limitation on Suits. A Noteholder may not pursue any
remedy with respect to this Indenture or the Notes unless:
(1) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(2) the Holders of at least 25% in aggregate principal amount of the
Notes at the time outstanding make a written request to the Trustee to
pursue the remedy;
(3) such Holder or Holders offer to the Trustee reasonable security
or indemnity satisfactory to the Trustee against any loss, liability or
expense;
(4) the Trustee does not comply with the request within 60 days
after receipt of such notice, request and offer of security or indemnity;
and
(5) the Holders of a majority in aggregate principal amount of the
Notes at the time outstanding do not give the Trustee a direction
inconsistent with the request during such 60-day period.
A Noteholder may not use this Indenture to prejudice the rights of
any other Noteholder or to obtain a preference or priority over any other
Noteholder.
SECTION 6.07 Rights of Holders to Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder to receive
payment of the principal amount, premium, if any, plus Redemption Price, Change
of Control Repurchase Price or any accrued cash interest in respect of the Notes
held by such Holder, on or after the respective due dates expressed in the Notes
or any Redemption Date, and to convert the Notes in accordance with Article 10,
or to bring suit for the enforcement of any such payment on or after such
respective dates or the right to convert, shall not be impaired or affected
adversely without the consent of such Holder.
40
SECTION 6.08 Collection Suit by Trustee. If an Event of Default
described in Section 6.01(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount owing with respect to the Notes and the amounts
provided for in Section 7.06.
SECTION 6.09 Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon the Notes or the
property of the Company or of such other obligor or their creditors, the Trustee
(irrespective of whether the principal amount, Redemption Price, Change of
Control Repurchase Price or any accrued cash interest in respect of the Notes
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of any such amount) shall be entitled and empowered,
by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of the principal
amount, Redemption Price, Change of Control Repurchase Price or any
accrued cash interest and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel or any
other amounts due the Trustee under Section 7.06) and of the Holders
allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.06.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.
SECTION 6.10 Priorities. If the Trustee collects any money pursuant
to this Article 6, it shall pay out the money in the following order:
(1) to the Trustee for amounts due under Section 7.06;
(2) to Noteholders for amounts due and unpaid on the Notes for the
principal amount, Redemption Price, Change of Control Purchase Price or
any accrued cash interest as the case may be, ratably, without preference
or priority of any kind, according to such amounts due and payable on the
Notes; and
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(3) the balance, if any, to the Company.
The Trustee may fix a record date and payment date for any payment
to Noteholders pursuant to this Section 6.10. At least 15 days before such
record date, the Trustee shall mail to each Noteholder and the Company a notice
that states the record date, the payment date and the amount to be paid.
SECTION 6.11 Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant (other than the Trustee) in the suit of
an undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees and expenses,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.07 or a suit by Holders of more than 10% in aggregate principal amount of the
Notes at the time outstanding. This Section 6.11 shall be in lieu of Section
315(e) of the TIA and such Section 315(e) is hereby expressly excluded from this
Indenture, as permitted by the TIA.
SECTION 6.12 Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury or other law
wherever enacted, now or at any time hereafter in force, which would prohibit or
forgive the Company from paying all or any portion of the principal amount,
Redemption Price, Change of Control Repurchase Price or any accrued cash
interest in respect of Notes, or any interest on such amounts, as contemplated
herein, or which may affect the covenants or the performance of this Indenture;
and the Company (to the extent that it may lawfully do so) hereby expressly
waives all benefit or advantage of any such law, and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
ARTICLE 7
TRUSTEE
SECTION 7.01 Duties and Responsibilities of the Trustee; During
Default; Prior to Default. The Trustee, prior to the occurrence of an Event of
Default hereunder and after the curing or waiving of all such Events of Default
which may have occurred, undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture. In case an Event of Default
hereunder has occurred (which has not been cured or waived), 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.
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No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default hereunder and
after the curing or waiving of all such Events of Default which may have
occurred:
(i) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Indenture, and
the Trustee shall not be liable except for the performance of such
duties and obligations as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be read
into this Indenture against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon any
statements, certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such statements, certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer or Responsible Officers of the
Trustee, unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(c) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the
direction of the Holders pursuant to Section 6.05 relating to the time,
method and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred upon the Trustee,
under this Indenture.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if there shall be reasonable ground for believing that the
repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.
The provisions of this Section 7.01 are in furtherance of and
subject to Sections 315 and 316 of the TIA.
SECTION 7.02 Certain Rights of the Trustee. In furtherance of and
subject to the TIA and subject to Section 7.01:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate or any
other certificate, statement, instrument, opinion, report, notice,
request, consent, order, bond, debenture, note, coupon, Note or
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other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by an Officers' Certificate (unless
other evidence in respect thereof be herein specifically prescribed); and
any resolution of the Board of Directors may be evidenced to the Trustee
by a copy thereof certified by the secretary or an assistant secretary of
the Company;
(c) the Trustee may consult with counsel of its selection and any
advice or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be taken
by it hereunder in good faith and in accordance with such advice or
Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
trusts or powers vested in it by this Indenture with the request, order or
direction of any of the Noteholders pursuant to the provisions of this
Indenture, unless such Noteholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred therein or thereby;
(e) the Trustee shall not be liable for any action taken or omitted
by it in good faith and believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this Indenture;
(f) prior to the occurrence of an Event of Default hereunder and
after the curing or waiving of all such Events of Default, the Trustee
shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, appraisal, bond,
debenture, note, coupon, security, or other paper or document unless
requested in writing to do so by the Holders of not less than a majority
in aggregate principal amount of the Notes then outstanding; provided
that, if the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to
the Trustee by the security afforded to it by the terms of this Indenture,
the Trustee may require reasonable indemnity against such expenses or
liabilities as a condition to proceeding; the reasonable expenses of every
such investigation shall be paid by the Company or, if paid by the Trustee
or any predecessor trustee, shall be repaid by the Company upon demand;
and
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys not regularly in its employ and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent
or attorney appointed with due care by it hereunder.
SECTION 7.03 Trustee Not Responsible for Recitals, Disposition of
Notes or Application of Proceeds Thereof. The recitals contained herein and in
the Notes, except the Trustee's certificates of authentication, shall be taken
as the statements of the Company, and the
44
Trustee assumes no responsibility for the correctness of the same. The Trustee
makes no representation as to the validity or sufficiency of this Indenture or
of the Notes. The Trustee shall not be accountable for the use or application by
the Company of any of the Notes or of the proceeds thereof.
SECTION 7.04 Trustee and Agents May Hold Notes; Collections, etc.
The Trustee or any agent of the Company or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Notes with the same rights it
would have if it were not the Trustee or such agent and, subject to Sections
7.08 and 7.13, if operative, may otherwise deal with the Company and receive,
collect, hold and retain collections from the Company with the same rights it
would have if it were not the Trustee or such agent.
SECTION 7.05 Moneys Held by Trustee. Subject to the provisions of
Section 8.02 hereof, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Trustee nor any agent of
the Company or the Trustee shall be under any liability for interest on any
moneys received by it hereunder.
SECTION 7.06 Compensation and Indemnification of Trustee and Its
Prior Claim. The Company covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to, such compensation (which shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust) to be agreed to in writing by the Trustee and the Company, and
the Company covenants and agrees to pay or reimburse the Trustee and each
predecessor Trustee upon its request for all reasonable expenses, disbursements
and advances incurred or made by or on behalf of it in accordance with any of
the provisions of this Indenture (including (i) the reasonable compensation and
the expenses and disbursements of its counsel and of all agents and other
persons not regularly in its employ and (ii) interest at the prime rate on any
disbursements and advances made by the Trustee and not paid by the Company
within 5 days after receipt of an invoice for such disbursement or advance)
except any such expense, disbursement or advance as may arise from its
negligence or bad faith. The Company also covenants to indemnify the Trustee and
each predecessor Trustee for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of this
Indenture or the trusts hereunder and its duties hereunder, including the costs
and expenses of defending itself against or investigating any claim of liability
in the premises. The obligations of the Company under this Section 7.06 to
compensate and indemnify the Trustee and each predecessor Trustee and to pay or
reimburse the Trustee and each predecessor Trustee for expenses, disbursements
and advances shall constitute additional indebtedness hereunder and shall
survive the satisfaction and discharge of this Indenture. Such additional
indebtedness shall be a senior claim to that of the Notes upon all property and
funds held or collected by the Trustee as such, except funds held in trust for
the benefit of the Holders of particular Notes, and the Notes are hereby
effectively subordinated to such senior claim to such extent. The provisions of
this Section 7.06 shall survive the termination of this Indenture. When the
Trustee incurs expenses or renders services in connection with an Event of
Default specified in Section 6.01 or in connection with Article Six hereof, the
expenses (including the reasonable fees and expenses of its counsel) and the
45
compensation for services in connection therewith are to constitute the expenses
of administration under any bankruptcy law.
SECTION 7.07 Right of Trustee to Rely on Officers' Certificate, etc.
Subject to Sections 7.01 and 7.02, whenever in the administration of the trusts
of this Indenture the Trustee shall deem it necessary or desirable that a matter
be proved or established prior to taking or suffering or omitting any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of negligence or bad faith on the
part of the Trustee, be deemed to be conclusively proved and established by an
Officers' Certificate delivered to the Trustee, and such certificate, in the
absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the
provisions of this Indenture upon the faith thereof.
SECTION 7.08 Conflicting Interests. If the Trustee has or shall
acquire a conflicting interest within the meaning of the TIA, the Trustee shall
either eliminate such interest or resign, to the extent and in the manner
provided by, and subject to the provisions of, the TIA.
SECTION 7.09 Persons Eligible for Appointment as Trustee. The
Trustee shall at all times be a corporation or banking association having a
combined capital and surplus of at least $10,000,000. If such corporation or
banking association publishes reports of condition at least annually, pursuant
to law or to the requirements of the aforesaid supervising or examining
authority, then, for the purposes of this Section 7.09, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 7.09, the Trustee shall resign immediately in the
manner and with the effect specified in Section 7.10.
SECTION 7.10 Resignation and Removal; Appointment of Successor
Trustee. (a) The Trustee, or any trustee or trustees hereafter appointed, may at
any time resign with respect to one or more or all series of Notes by giving
written notice of resignation to the Company and by mailing notice thereof by
first class mail to the Holders of Notes at their last addresses as they shall
appear on the Note register. Upon receiving such notice of resignation, the
Company shall promptly appoint a successor trustee or trustees by written
instrument in duplicate, executed by authority of the Board of Directors, one
copy of which instrument shall be delivered to the resigning Trustee and one
copy to the successor trustee or trustees. If no successor trustee shall have
been so appointed and have accepted appointment within 30 days after the mailing
of such notice of resignation, the resigning trustee may petition any court of
competent jurisdiction for the appointment of a successor trustee, or any
Noteholder who has been a bona fide Holder of a Note for at least six months
may, subject to the provisions of Section 7.11, on behalf of himself and all
others similarly situated, petition any such court for the appointment of a
successor trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
46
(i) the Trustee shall fail to comply with the provisions of Section
7.08 with respect to any Notes after written request therefor by the
Company or by any Noteholder who has been a bona fide Holder of a Note for
at least six months; or
(ii) the Trustee shall cease to be eligible in accordance with the
provisions of Section 7.09 and shall fail to resign after written request
therefor by the Company or by any Noteholder; or
(iii) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent, or a receiver or liquidator of the
Trustee or of its property shall be appointed, or any public officer shall
take charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation; or
(iv) the Company shall determine that the Trustee has failed to
perform its obligations under this Indenture in any material respect;
then, in any such case, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors of the Company, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor trustee, or,
subject to the provisions of Section 7.11, any Noteholder who has been a bona
fide Holder of a Note for at least six months may on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor trustee. Such court
may thereupon, after such notice, if any, as it may deem proper and prescribe,
remove the Trustee and appoint a successor trustee. If no successor trustee
shall have been appointed and have accepted appointment within 30 days after a
notice of removal has been given, the removed trustee may petition a court of
competent jurisdiction for the appointment of a successor trustee.
(c) The Holders of a majority in aggregate principal amount of the
Notes at the time outstanding may at any time remove the Trustee and appoint a
successor trustee by delivering to the Trustee so removed, to the successor
trustee so appointed and to the Company the evidence provided for in Section
1.05 of the action in that regard taken by the Noteholders.
(d) Any resignation or removal of the Trustee and any appointment of
a successor trustee pursuant to any of the provisions of this Section 7.10 shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 7.11.
SECTION 7.11 Acceptance of Appointment by Successor Trustee. Any
successor trustee appointed as provided in Section 7.10 shall execute and
deliver to the Company and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as trustee hereunder; but, nevertheless, on the written
request of the Company or of the successor trustee, upon payment of its charges
then unpaid, the trustee ceasing to act shall pay over to the successor trustee
all moneys at the time held by it hereunder and shall execute and deliver an
instrument transferring to such successor trustee all such rights, powers,
47
duties and obligations. Upon request of any such successor trustee, the Company
shall execute any and all instruments in writing for more fully and certainly
vesting in and confirming to such successor trustee all such rights and powers.
Any trustee ceasing to act shall, nevertheless, retain a prior claim upon all
property or funds held or collected by such trustee to secure any amounts then
due it pursuant to the provisions of Section 7.06.
No successor trustee shall accept appointment as provided in this
Section 7.11 unless at the time of such acceptance such successor trustee shall
be qualified under the provisions of Section 7.08 and eligible under the
provisions of Section 7.09.
Upon acceptance of appointment by any successor trustee as provided
in this Section 7.11, the Company shall mail notice thereof by first class mail
to the Holders of Notes at their last addresses as they shall appear in the
register. If the acceptance of appointment is substantially contemporaneous with
the resignation, then the notice called for by the preceding sentence may be
combined with the notice called for by Section 7.10. If the Company fails to
mail such notice within ten days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of the Company.
SECTION 7.12 Merger, Conversion, Consolidation or Succession to
Business of Trustee. Any corporation or banking association into which the
Trustee may be merged or converted or with which it may be consolidated, or any
corporation or banking association resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any corporation or
banking association succeeding to all or substantially all of the corporate
trust business of the Trustee, shall be the successor of the Trustee hereunder,
provided that such corporation or banking association shall be qualified under
the provisions of Section 7.08 and eligible under the provisions of Section
7.09, without the execution or filing of any paper or any further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding. In case at the time such successor to the Trustee shall succeed
to the trusts created by this Indenture any of the Notes shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor Trustee and deliver such Notes
so authenticated; and, in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor hereunder or in the name of the successor
Trustee; and in all such cases such certificate shall have the full force and
effect that this Indenture provides for the certificate of authentication of the
Trustee; provided, that the right to adopt the certificate of authentication of
any predecessor Trustee or to authenticate Notes in the name of any predecessor
Trustee shall apply only to its successor or successors by merger, conversion or
consolidation.
SECTION 7.13 Preferential Collection of Claims Against the Company.
The Trustee shall comply with the provisions of Section 311 of the TIA.
SECTION 7.14 Reports by the Trustee. (a) The Trustee shall transmit
to Holders and other persons such reports concerning the Trustee and its actions
under this Indenture as may be required pursuant to the TIA on or before July 15
in each year that such report is required, such reports to be dated as of the
immediately preceding May 15.
48
(b) A copy of each such report shall, at the time of such
transmission to Noteholders, be furnished to the Company and be filed by the
Trustee with each stock exchange upon which the Notes are listed and also with
the SEC. The Company agrees to notify the Trustee when and as the Notes become
admitted to trading on any national securities exchange.
SECTION 7.15 Trustee to Give Notice of Default, But May Withhold in
Certain Circumstances. The Trustee shall transmit to the Noteholders, as the
names and addresses of such Holders appear on the Note register, notice by mail
of all Defaults which have occurred, such notice to be transmitted within 90
days after the occurrence thereof, unless such defaults shall have been cured
before the giving of such notice; provided that, except in the case of Default
in the payment of the principal of, interest on, or other similar obligation
with respect to, any of the Notes, the Trustee shall be protected in withholding
such notice if and so long as the board of directors, the executive committee,
or a trust committee of directors or trustees and/or Responsible Officers of the
Trustee in good faith determines that the withholding of such notice is in the
best interests of the Noteholders.
ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.01 Termination of the Company's Obligations. Except as
otherwise provided in this Section 8.01, the Company may terminate its
obligations under the Notes and this Indenture if:
(i) all Notes previously authenticated and delivered (other than
destroyed, lost or stolen Notes that have been replaced or Notes that are
paid pursuant to Section 2.07 hereof or Notes for whose payment money or
securities have theretofore been held in trust and thereafter repaid to
the Company, as provided in Section 8.05 hereof) have been delivered to
the Trustee for cancellation and the Company has paid all sums payable by
it hereunder; or
(ii) (A) all of the Notes mature within one year or all of them are
to be called for redemption within one year under arrangements
satisfactory to the Trustee for giving the notice of redemption, (B) the
Company deposits in trust with the Trustee during such one-year period,
under the terms of an irrevocable trust agreement in form and substance
satisfactory to the Trustee, as trust funds solely for the benefit of the
Holders for that purpose, money or U.S. Government Obligations sufficient
to pay principal, premium, if, any, and interest on the Notes to maturity
or redemption, as the case may be, and to pay all other sums payable by it
hereunder, (C) no Default or Event of Default with respect to the Notes
shall have occurred and be continuing on the date of such deposit, (D)
such deposit will not result in a breach or violation of, or constitute a
default under, this Indenture or any other agreement or instrument to
which the Company is a party or by which it is bound and (E) the Company
has delivered to the Trustee an Officers' Certificate and an Opinion of
Counsel, in each case stating that all conditions precedent provided for
herein relating to the satisfaction and discharge of this Indenture have
been complied with.
49
With respect to the foregoing clause (i), the Company's obligations
under Section 7.06 hereof shall survive. With respect to the foregoing clause
(ii), the Company's obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07,
4.01, 4.05, 7.06, 7.10 8.04, 8.05 and 8.06 of this Indenture shall survive until
the Notes are no longer outstanding. Thereafter, only the Company's obligations
in Sections 7.06, 8.05 and 8.06 of this Indenture shall survive. After any such
irrevocable deposit, the Trustee upon request shall acknowledge in writing the
discharge of the Company's obligations, as the case may be, under the Notes and
this Indenture, except for those surviving obligations specified above.
SECTION 8.02 Defeasance and Discharge of Indenture. Subject to
Section 8.08, the Company will be deemed to have paid and will be discharged
from any and all obligations in respect of the Notes on the 123rd day after the
deposit referred to below, and the provisions of this Indenture will no longer
be in effect with respect to the Notes (except for, among other matters, certain
obligations to register the transfer or exchange of the Notes, to replace
stolen, lost or mutilated Notes, to maintain paying agencies and to hold monies
for payment in trust) if, among other things:
(A) the Company has deposited with the Trustee, in trust,
money and/or U.S. Government Obligations that through the payment of
interest and principal in respect thereof in accordance with their
terms will provide money in an amount sufficient in the opinion of a
nationally recognized independent public accounting firm to pay the
principal of, premium, if any, and accrued interest on the Notes on
the Stated Maturity of such payments in accordance with the terms of
this Indenture and the Notes;
(B) the Company has delivered to the Trustee (i) either (x) an
Opinion of Counsel to the effect that Holders will not recognize
income, gain or loss for federal income tax purposes as a result of
the Company's exercise of its option under this Section 8.02 and
will be subject to federal income tax on the same amount and in the
same manner and at the same times as would have been the case if
such deposit, defeasance and discharge had not occurred, which
Opinion of Counsel must be based upon (and accompanied by a copy of)
a ruling of the Internal Revenue Service to the same effect unless
there has been a change in applicable federal income tax law after
the Closing Date such that a ruling is no longer required or (y) a
ruling directed to the Trustee received from the Internal Revenue
Service to the same effect as the aforementioned Opinion of Counsel
and (ii) an Opinion of Counsel to the effect that the creation of
the defeasance trust does not violate the Investment Company Act of
1940 and after the passage of 123 days following the deposit, the
trust fund will not be subject to the effect of Section 547 of the
United States Bankruptcy Code or Section 15 of the New York Debtor
and Creditor Law; and
(C) immediately after giving effect to such deposit on a pro
forma basis, no Event of Default, or event that after the giving of
notice or lapse of time or both would become an Event of Default,
shall have occurred and be continuing on the date of such deposit or
during the period ending on the 123rd day after the date of such
deposit, and such deposit shall not result in a breach or violation
of,
50
or constitute a default under, any other agreement or instrument to
which the Company or any of its Subsidiaries is a party or by which
the Company or any of its Subsidiaries is bound.
Notwithstanding the foregoing, prior to the end of the 123-day
period referred to in clause (B)(ii) of this Section 8.02, none of the Company's
obligations under this Indenture shall be discharged. Subsequent to the end of
such 123-day period with respect to this Section 8.02, the Company's obligations
in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 4.01, 4.05, 7.06, 7.10, 8.04,
8.05, 8.06, 8.08 and Article 10 shall survive until the Notes are no longer
outstanding. Thereafter, only the Company's obligations in Sections 7.06, 8.05
and 8.06 shall survive. If and when a ruling from the Internal Revenue Service
or an Opinion of Counsel referred to in clause (B)(i) of this Section 8.02 may
be provided specifically without regard to, and not in reliance upon, the
continuance of the Company's obligations under Section 4.01, then the Company's
obligations under such Section 4.01 shall cease upon delivery to the Trustee of
such ruling or Opinion of Counsel and compliance with the other conditions
precedent provided for herein relating to the defeasance contemplated by this
Section 8.02.
After the 123 day period referred to in clause (B)(ii) of this
Section 8.02, the Trustee upon Company Order shall acknowledge in writing the
discharge of the Company's obligations under the Notes and this Indenture except
for those surviving obligations in the immediately preceding paragraph.
SECTION 8.03 Defeasance of Certain Obligations. The Company may omit
to comply with any term, provision or condition set forth in clause 4.07 upon:
(a) the deposit, in trust, with the Trustee (or another trustee
satisfying the requirements of Section 7.10 hereof) of money and/or U.S.
Government Obligations that, through the payment of interest and principal in
respect thereof in accordance with their terms, will provide money in an amount
sufficient in the opinion of a nationally recognized independent public
accounting firm to pay the principal of, premium, if any, and accrued interest
on the Notes on the Stated Maturity of such payments in accordance with the
terms of this Indenture and the Notes;
(b) the satisfaction of the provisions described in clauses B(ii),
(C) and (D) of Section 8.02 hereof;
(c) delivery by the Company to the Trustee of an Opinion of Counsel
to the effect that, the Holders will not recognize income, gain or loss for
federal income tax purposes as a result of such deposit and defeasance and will
be subject to federal income tax on the same amount and in the same manner and
at the same times as would have been the case if such deposit and defeasance had
not occurred; and
(d) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, in each case stating that all conditions
precedent provided for herein relating to the defeasance contemplated by this
Section 8.03 have been complied with.
SECTION 8.04 Application of Trust Money. Subject to Section 8.06,
the Trustee or Paying Agent shall hold in trust money or U.S. Government
Obligations deposited
51
with it pursuant to Section 8.01, 8.02 or 8.03, as the case may be, and shall
apply the deposited money and the money from U.S. Government Obligations in
accordance with the Notes and this Indenture to the payment of principal of,
premium, if any, and interest on the Notes; but such money need not be
segregated from other funds except to the extent required by law.
SECTION 8.05 Reinstatement. If the Trustee or the Paying Agent is
unable to apply any money or U.S. Government Obligations in accordance with
Section 8.01, 8.02 or 8.03, as the case may be, by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 8.01, 8.02 or
8.03, as the case may be, until such time as the Trustee or Paying Agent is
permitted to apply all such money or U.S. Government Obligations in accordance
with Section 8.01, 8.02 or 8.03, as the case may be; provided that, if the
Company has made any payment of principal of, premium, if any, or interest on
any Notes because of the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Notes to receive such payment
from the money or U.S. Government Obligations held by the Trustee or Paying
Agent.
SECTION 8.06 Defeasance and Certain Other Events of Default. In the
event that the Company exercises its option to omit compliance with certain
covenants and provisions of this Indenture with respect to the Notes pursuant to
Section 8.03 and such Notes are declared due and payable because of the
occurrence of an Event of Default that remains applicable, the amount of money
and/or U.S. Government Obligations on deposit with the Trustee will be
sufficient to pay amounts due on such Notes at the time of their Stated
Maturity. If, in the event the Company exercises its option to omit compliance
with certain covenants and provisions of this Indenture with respect to the
Notes pursuant to Section 8.03 and such Notes are declared due and payable
because of the occurrence of an Event of Default that remains applicable, the
amount of money and/or U.S. Government Obligations on deposit with the Trustee
is insufficient to pay amounts due on the Notes at the time of the acceleration
resulting from such Events of Default pursuant to Section 6.02, the Company will
remain liable for such payments.
SECTION 8.07 Repayment of the Company. The Trustee and the Paying
Agent shall return to the Company upon written request any money or securities
held by them for the payment of any amount with respect to the Notes that
remains unclaimed for two years, subject to applicable unclaimed property law.
After return to the Company, Holders entitled to the money or securities must
look to the Company for payment as general creditors unless an applicable
abandoned property law designates another person and the Trustee and the Paying
Agent shall have no further liability to the Noteholders with respect to such
money or securities for that period commencing after the return thereof.
SECTION 8.08 Conversion of Notes Upon Discharge. Notwithstanding any
satisfaction, defeasance or discharge of this Indenture pursuant to the
provisions of this Article 8, for so long as any of the Notes are outstanding,
the conversion right of Noteholders set forth in this Indenture shall not expire
until the close of business on October 17, 2008 and the Company shall remain
obligated to issue duly authorized, fully paid and nonassessable shares of
Common Stock upon conversion of the Notes in accordance with the terms of this
Indenture.
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ARTICLE 9
AMENDMENTS
SECTION 9.01 Without Consent of Holders. The Company and the Trustee
may amend this Indenture or the Notes without the consent of any Noteholder for
the purposes of, among other things:
(1) adding to the Company's covenants or obligations under this
Indenture for the benefit of the Holders;
(2) surrendering any right, power or option conferred upon the
Company by this Indenture;
(3) providing for conversion rights of Holders if any
reclassification or change of Common Stock or any consolidation, merger or
sale of all or substantially all of the Company's assets occurs;
(4) providing for the assumption of the Company's obligations to the
Holders in the case of a merger, consolidation, conveyance, transfer or
lease;
(5) reducing the Conversion Price, provided that the reduction will
not adversely affect the interests of Holders in any material respect;
(6) complying with the requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA;
(7) making any changes or modifications to this Indenture necessary
in connection with the registration of the Notes under the Securities Act
as contemplated by the registration rights agreement, provided that this
action does not adversely affect the interests of the Holders in any
material respect;
(8) curing any ambiguity or correcting or supplementing any
defective provision contained in this Indenture; provided that such
modification or amendment does not, in the good faith opinion of the Board
of Directors and the Trustee, adversely affect the interests of the
Holders in any material respect;
(9) adding or modifying any other provisions which the Company and
the Trustee may deem necessary or desirable and which will not adversely
affect the interests of the Holders in any material respect; or
(10) to evidence and provide for the acceptance of appointment of a
successor Trustee.
SECTION 9.02 With Consent of Holders. With the written consent of
the Holders of at least a majority in aggregate principal amount of the Notes at
the time outstanding, the Company and the Trustee may amend this Indenture or
the Notes. However, without the consent of each Noteholder affected, an
amendment to this Indenture or the Notes may not:
53
(1) change the maturity of the principal of or any installment of
interest on any Note (including any payment of liquidated damages);
(2) reduce the principal amount of, or any premium or interest on
(including any payment of liquidated damages), any Note;
(3) change the currency of payment of such Note or interest thereon;
(4) impair the right to institute suit for the enforcement of any
payment on or with respect to any Note;
(5) modify the Company's obligations to maintain an office or agency
in New York City;
(6) except as otherwise permitted or contemplated by provisions
concerning corporate reorganizations, adversely affect the repurchase
option of Holders upon a Change of Control or the conversion rights of
Holders;
(7) modify the subordination provisions of the Notes in a manner
adverse to the Holders; or
(8) reduce the percentage in aggregate principal amount of Notes
outstanding necessary to modify or amend this Indenture or to waive any
past default.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section 9.02 becomes effective, the
Company shall mail to each Holder a notice briefly describing the amendment.
SECTION 9.03 Compliance with Trust Indenture Act. Every supplemental
indenture executed pursuant to this Article shall comply with the TIA.
SECTION 9.04 Revocation and Effect of Consents, Waivers and Actions.
Until an amendment, waiver or other action by Holders becomes effective, a
consent thereto by a Holder of a Note hereunder is a continuing consent by the
Holder and every subsequent Holder of that Note or portion of the Note that
evidences the same obligation as the consenting Holder's Note, even if notation
of the consent, waiver or action is not made on the Note. However, any such
Holder or subsequent Holder may revoke the consent, waiver or action as to such
Holder's Note or portion of the Note if the Trustee receives the notice of
revocation before the date the amendment, waiver or action becomes effective.
After an amendment, waiver or action becomes effective, it shall bind every
Noteholder.
SECTION 9.05 Notation on or Exchange of Notes. Notes authenticated
and delivered after the execution of any supplemental indenture pursuant to this
Article may, and shall if required by the Trustee, bear a notation in form
approved by the Trustee as to any matter provided for in such supplemental
indenture. If the Company shall so determine, new Notes so
54
modified as to conform, in the opinion of the Trustee and the Board of
Directors, to any such supplemental indenture may be prepared and executed by
the Company and authenticated and delivered by the Trustee in exchange for
outstanding Notes.
SECTION 9.06 Trustee to Sign Supplemental Indentures. The Trustee
shall sign any supplemental indenture authorized pursuant to this Article 9 if
the amendment contained therein does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If it does, the Trustee may, but need
not, sign such supplemental indenture. In signing such supplemental indenture
the Trustee shall be entitled to receive, and (subject to the provisions of
Section 7.01) shall be fully protected in relying upon, an Officers' Certificate
and an Opinion of Counsel stating that such amendment is authorized or permitted
by this Indenture.
SECTION 9.07 Effect of Supplemental Indentures. Upon the execution
of any supplemental indenture under this Article, this Indenture shall be
modified in accordance therewith, and such supplemental indenture shall form a
part of this Indenture for all purposes; and every Holder of Notes theretofore
or thereafter authenticated and delivered hereunder shall be bound thereby.
ARTICLE 10
CONVERSION
SECTION 10.01 Conversion Right and Conversion Price. Subject to and
upon compliance with the provisions of this Article, at the option of the Holder
thereof, any Note or any portion of the principal amount thereof which is $1,000
or an integral multiple of $1,000 may be converted at the principal amount
thereof, or of such portion thereof, into duly authorized, fully paid and
nonassessable shares of Common Stock, at the Conversion Price, determined as
hereinafter provided, in effect at the time of conversion. Such conversion right
shall expire at the close of business on October 17, 2008.
In case a Note or portion thereof is called for redemption, such
conversion right in respect of the Note or the portion so called, shall expire
at the close of business on the Business Day preceding the Redemption Date,
unless the Company defaults in making the payment due upon redemption. In the
case of a Change of Control for which the Holder exercises its repurchase right
with respect to a Note or portion thereof, such conversion right in respect of
the Note or portion thereof shall expire at the close of business on the
Business Day immediately preceding the Change of Control Repurchase Date.
The price at which shares of Common Stock shall be delivered upon
conversion (the "Conversion Price") shall be initially equal to $30.2512 per
share of Common Stock. The Conversion Price shall be adjusted in certain
instances as provided in paragraphs (a), (b), (c), (d), (e), (f), (h) and (i) of
Section 10.04 hereof.
SECTION 10.02 Exercise of Conversion Right. To exercise the
conversion right, the Holder of any Note to be converted shall surrender such
Note duly endorsed or assigned to the Company or in blank, at the office of any
Conversion Agent, accompanied by a duly signed conversion notice substantially
in the form attached to the Note to the Company
55
stating that the Holder elects to convert such Note or, if less than the entire
principal amount thereof is to be converted, the portion thereof to be
converted.
Notes surrendered for conversion, other than those called for
Provisional Redemption or Optional Redemption, during the period from the close
of business on any Regular Record Date to the opening of business on the next
succeeding Interest Payment Date shall be accompanied by payment in New York
Clearing House funds or other funds acceptable to the Company of an amount equal
to the interest to be received on such Interest Payment Date on the principal
amount of Notes being surrendered for conversion. No such payment will be
required if the Notes are called for Provisional Redemption or Optional
Redemption.
Notes shall be deemed to have been converted immediately prior to
the close of business on the day of surrender of such Notes for conversion in
accordance with the foregoing provisions, and at such time the rights of the
Holders of such Notes as Holders shall cease, and the Person or Persons entitled
to receive the Common Stock issuable upon conversion shall be treated for all
purposes as the record holder or holders of such Common Stock at such time. As
promptly as practicable on or after the conversion date, the Company shall cause
to be issued and delivered to such Conversion Agent a certificate or
certificates for the number of full shares of Common Stock issuable upon
conversion, together with payment in lieu of any fraction of a share as provided
in Section 10.03 hereof.
In the case of any Note which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to the Holder thereof, at the expense of the Company, a new Note or
Notes of authorized denominations in aggregate principal amount equal to the
unconverted portion of the principal amount of such Notes.
If shares of Common Stock to be issued upon conversion of a
Restricted Note, or securities to be issued upon conversion of a Restricted Note
in part only, are to be registered in a name other than that of the Holder of
such Restricted Note, such Holder must deliver to the Conversion Agent a
certificate in substantially the form set forth in the form of Note set forth in
Exhibit A annexed hereto, dated the date of surrender of such Restricted Note
and signed by such Holder, as to compliance with the restrictions on transfer
applicable to such Restricted Note. Neither the Trustee nor any Conversion
Agent, Registrar or Transfer Agent shall be required to register in a name other
than that of the Holder shares of Common Stock or Notes issued upon conversion
of any such Restricted Note not so accompanied by a properly completed
certificate.
The Company hereby initially appoints the Trustee as the Conversion
Agent.
SECTION 10.03 Fractions of Shares. No fractional shares of Common
Stock shall be issued upon conversion of any Note or Notes. If more than one
Note shall be surrendered for conversion at one time by the same Holder, the
number of full shares which shall be issued upon conversion thereof shall be
computed on the basis of the aggregate principal amount of the Notes (or
specified portions thereof) so surrendered. Instead of any fractional share of
Common Stock which would otherwise be issued upon conversion of any Note or
Notes (or specified portions thereof), the Company shall pay a cash adjustment
in respect of such fraction (calculated to the nearest one-100th of a share) in
an amount equal to the same fraction
56
of the quoted price of the Common Stock as of the Trading Day preceding the date
of conversion.
SECTION 10.04 Adjustment of Conversion Price. The Conversion Price
shall be subject to adjustments, calculated by the Company, from time to time as
follows:
(a) In case the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of
Common Stock, the Conversion Price in effect at the opening of business on
the date following the date fixed for the determination of holders of
Common Stock entitled to receive such dividend or other distribution shall
be reduced by multiplying such Conversion Price by a fraction:
(1) the numerator of which shall be the number of shares of
Common Stock outstanding at the close of business on the Record Date
(as defined in Section 10.4(g)) fixed for such determination, and
(2) the denominator of which shall be the sum of such number
of shares and the total number of shares constituting such dividend
or other distribution payable to the holders of Common Stock.
Such reduction shall become effective immediately after the opening of
business on the day following the Record Date. If any dividend or
distribution of the type described in this Section 10.04(a) is declared
but not so paid or made, the Conversion Price shall again be adjusted to
the Conversion Price which would then be in effect if such dividend or
distribution had not been declared.
(b) In case the outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock, the Conversion
Price in effect at the opening of business on the day following the day
upon which such subdivision becomes effective shall be proportionately
reduced, and conversely, in case outstanding shares of Common Stock shall
be combined into a smaller number of shares of Common Stock, the
Conversion Price in effect at the opening of business on the day following
the day upon which such combination becomes effective shall be
proportionately increased, such reduction or increase, as the case may be,
to become effective immediately after the opening of business on the day
following the day upon which such subdivision or combination becomes
effective.
(c) In case the Company shall issue rights or warrants (other than
any rights or warrants referred to in Section 10.04(d)) to all holders of
its outstanding shares of Common Stock entitling them to subscribe for or
purchase shares of Common Stock (or securities convertible into Common
Stock) at a price per share (or having a conversion price per share) less
than the Current Market Price (as defined in Section 10.04(g)) on the
Record Date fixed for the determination of stockholders entitled to
receive such rights or warrants, the Conversion Price shall be adjusted so
that the same shall equal the price determined by multiplying the
Conversion Price in effect at the opening of business on the date after
such Record Date by a fraction:
57
(1) the numerator of which shall be the number of shares of
Common Stock outstanding at the close of business on the Record Date
plus the number of shares which the aggregate offering price of the
total number of shares so offered for subscription or purchase (or
the aggregate conversion price of the convertible securities so
offered) would purchase at such Current Market Price, and
(2) the denominator of which shall be the number of shares of
Common Stock outstanding on the close of business on the Record Date
plus the total number of additional shares of Common Stock so
offered to the holders of Common Stock for subscription or purchase
(or into which the convertible securities so offered are
convertible).
Such adjustment shall become effective immediately after the opening of
business on the day following the Record Date fixed for determination of
stockholders entitled to receive such rights or warrants. To the extent
that shares of Common Stock (or securities convertible into Common Stock)
are not delivered pursuant to such rights or warrants, upon the expiration
or termination of such rights or warrants the Conversion Price shall be
readjusted to the Conversion Price which would then be in effect had the
adjustments made upon the issuance of such rights or warrants been made on
the basis of the delivery of only the number of shares of Common Stock (or
securities convertible into Common Stock) actually delivered. In the event
that such rights or warrants are not so issued, the Conversion Price shall
again be adjusted to be the Conversion Price which would then be in effect
if such date fixed for the determination of holders of Common Stock
entitled to receive such rights or warrants had not been fixed. In
determining whether any rights or warrants entitle the holders to
subscribe for or purchase shares of Common Stock at less than such Current
Market Price, and in determining the aggregate offering price of such
shares of Common Stock, there shall be taken into account any
consideration received for such rights or warrants, the value of such
consideration if other than cash, to be determined by the Board of
Directors.
(d) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock shares of any class of Capital Stock of
the Company (other than any dividends or distributions to which Section
10.04(a) or Section 10.4(g) applies) or evidences of its indebtedness,
cash or other assets, including securities, but excluding (1) any rights
or warrants referred to in Section 10.04(c), (2) any stock, securities or
other property or assets (including cash) distributed in connection with a
reclassification, merger, consolidation, statutory share exchange,
combination, sale or conveyance to which Section 10.11 hereof applies and
(3) dividends and distributions paid exclusively in cash (the securities
described in foregoing clauses (1), (2) and (3) hereinafter in this
Section 10.04(d) called the "excluded securities"), then, in each such
case, subject to the second succeeding paragraph of this Section 10.04(d),
the Conversion Price shall be adjusted so that the same shall be equal to
the price determined by multiplying the Conversion Price in effect
immediately prior to the close of business on the Record Date (as defined
in Section 10.04(g)) with respect to such distribution by a fraction:
(1) the numerator of which shall be the Current Market Price
(determined as provided in Section 10.04(g)) on such date less the
fair market
58
value (as determined by the Board of Directors, whose determination
shall be conclusive and set forth in a Board Resolution) on such
date of the portion of the securities so distributed (other than
excluded securities) applicable to one share of Common Stock
(determined on the basis of the number of shares of the Common Stock
outstanding on the Record Date), and
(2) the denominator of which shall be such Current Market
Price.
Such reduction shall become effective immediately prior to the opening of
business on the day following the Record Date. However, in the event that
the then fair market value (as so determined) of the portion of the
securities so distributed (other than excluded securities) applicable to
one share of Common Stock is equal to or greater than the Current Market
Price on the Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Holder shall have the right to
receive upon conversion of a Note (or any portion thereof) the amount of
securities so distributed (other than excluded securities) such Holder
would have received had such Holder converted such Note (or portion
thereof) immediately prior to such Record Date. In the event that such
dividend or distribution is not so paid or made, the Conversion Price
shall again be adjusted to be the Conversion Price which would then be in
effect if such dividend or distribution had not been declared.
If the Board of Directors determines the fair market value of any
distribution for purposes of this Section 10.04(d) by reference to the
actual or when issued trading market for any securities comprising all or
part of such distribution (other than excluded securities), it must in
doing so consider the prices in such market over the same period (the
"Reference Period") used in computing the Current Market Price pursuant to
Section 10.04(g) to the extent possible, unless the Board of Directors in
a Board Resolution determines in good faith that determining the fair
market value during the Reference Period would not be in the best interest
of the Holder.
Rights or warrants distributed by the Company to all holders of
Common Stock entitling the holders thereof to subscribe for or purchase
shares of the Company's Capital Stock (either initially or under certain
circumstances), which rights or warrants, until the occurrence of a
specified event or events ("Trigger Event"):
(i) are deemed to be transferred with such shares of Common
Stock;
(ii) are not exercisable; and
(iii) are also issued in respect of future issuances of Common
Stock,
shall be deemed not to have been distributed for purposes of this Section
10.04(d) (and no adjustment to the Conversion Price under this Section
10.04(d) will be required) until the occurrence of the earliest Trigger
Event. If such right or warrant is subject to subsequent events, upon the
occurrence of which such right or warrant shall become exercisable to
purchase different securities, evidences of indebtedness or other assets
or entitle the holder to purchase a different number or amount of the
foregoing or to purchase any of the foregoing at a different purchase
price, then the occurrence of each such event shall
59
be deemed to be the date of issuance and record date with respect to a new
right or warrant (and a termination or expiration of the existing right or
warrant without exercise by the holder thereof). In addition, in the event
of any distribution (or deemed distribution) of rights or warrants, or any
Trigger Event or other event (of the type described in the preceding
sentence) with respect thereto, that resulted in an adjustment to the
Conversion Price under this Section 10.04(d):
(1) in the case of any such rights or warrants which shall all
have been redeemed or repurchased without exercise by any holders
thereof, the Conversion Price shall be readjusted upon such final
redemption or repurchase to give effect to such distribution or
Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price
received by a holder of Common Stock with respect to such rights or
warrant (assuming such holder had retained such rights or warrants),
made to all holders of Common Stock as of the date of such
redemption or repurchase, and
(2) in the case of such rights or warrants all of which shall
have expired or been terminated without exercise, the Conversion
Price shall be readjusted as if such rights and warrants had never
been issued.
For purposes of this Section 10.04(d) and Sections 10.04(a),
10.04(b) and 10.04(c), any dividend or distribution to which this Section
10.04(d) is applicable that also includes shares of Common Stock, a
subdivision or combination of Common Stock to which Section 10.04(b)
applies, or rights or warrants to subscribe for or purchase shares of
Common Stock to which Section 10.04(c) applies (or any combination
thereof), shall be deemed instead to be:
(3) a dividend or distribution of the evidences of
indebtedness, assets, shares of Capital Stock, rights or warrants
other than such shares of Common Stock, such subdivision or
combination or such rights or warrants to which Sections 10.04(a),
10.04(b) and 10.04(c) apply, respectively (and any Conversion Price
reduction required by this Section 10.04(d) with respect to such
dividend or distribution shall then be made), immediately followed
by
(4) a dividend or distribution of such shares of Common Stock,
such subdivision or combination or such rights or warrants (and any
further Conversion Price reduction required by Sections 10.04(a),
10.04(b) and 10.04(c) with respect to such dividend or distribution
shall then be made), except:
(A) the Record Date of such dividend or distribution
shall be substituted as (x) "the date fixed for the
determination of stockholders entitled to receive such
dividend or other distribution", "Record Date fixed for such
determinations" and "Record Date" within the meaning of
Section 10.04(a), (y) "the day upon which such subdivision
becomes effective" and "the day upon which such combination
becomes effective" within the meaning of Section 10.04(b), and
(z) as "the date fixed for the determination of stockholders
entitled to receive such rights or warrants",
60
"the Record Date fixed for the determination of the
stockholders entitled to receive such rights or warrants" and
such "Record Date" within the meaning of Section 10.04(c), and
(B) any shares of Common Stock included in such dividend
or distribution shall not be deemed "outstanding at the close
of business on the date fixed for such determination" within
the meaning of Section 10.04(a) and any reduction or increase
in the number of shares of Common Stock resulting from such
subdivision or combination shall be disregarded in connection
with such dividend or distribution.
With respect to any shareholder rights plan existing on the date
hereof or in the event that the Company implements any other shareholder
rights plan, upon conversion of the Notes the Holders will receive, in
addition to the Common Stock issuable upon such conversion, the rights
issued under such rights plan (notwithstanding the occurrence of an event
causing such rights to separate from the Common Stock at or prior to the
time of conversion); provided, a Holder who is a holder of Common Stock
(or direct or indirect interests therein) at the time of conversion, but
who is not entitled as such a holder to such rights pursuant to the terms
of any such plan, shall not be eligible to receive any such rights
hereunder. Any distribution of rights or warrants pursuant to a
shareholder rights plan complying with the requirements set forth in the
immediately preceding sentence of this paragraph shall not constitute a
distribution of rights or warrants for the purposes of the other
provisions of this section 10.04(d).
(e) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock cash (excluding any cash that is
distributed upon a reclassification, merger, consolidation, statutory
share exchange, combination, sale or conveyance to which Section 10.11
hereof applies or as part of a distribution referred to in Section
10.04(d) hereof), in an aggregate amount that, combined together with: (1)
the aggregate amount of any other such distributions to all holders of
Common Stock made exclusively in cash within the 12 months preceding the
date of payment of such distribution, and in respect of which no
adjustment pursuant to this Section 10.04(e) has been made, and (2) the
aggregate of any cash plus the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and set forth
in a Board Resolution) of consideration payable in respect of any tender
offer by the Company or any of its subsidiaries for all or any portion of
the Common Stock concluded within the 12 months preceding the date of such
distribution, and in respect of which no adjustment pursuant to Section
10.04(f) hereof has been made, exceeds 5% of the product of the Current
Market Price (determined as provided in Section 10.04(g)) on the Record
Date with respect to such distribution times the number of shares of
Common Stock outstanding on such date, then and in each such case,
immediately after the close of business on such date, the Conversion Price
shall be reduced so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the close
of business on such Record Date by a fraction:
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(i) the numerator of which shall be equal to the Current
Market Price on the Record Date less an amount equal to the quotient
of (x) the excess of such combined amount over such 5% and (y) the
number of shares of Common Stock outstanding on the Record Date, and
(ii) the denominator of which shall be equal to the Current
Market Price on such date.
However, in the event that the then fair market value (as so determined)
of the portion of the securities so distributed (other than excluded
securities) applicable to one share of Common Stock is equal to or greater
than the Current Market Price on the Record Date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each Holder shall
have the right to receive upon conversion of a Note (or any portion
thereof) the amount of cash such Holder would have received had such
Holder converted such Note (or portion thereof) immediately prior to such
Record Date. In the event that such dividend or distribution is not so
paid or made, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such dividend or
distribution had not been declared.
(f) In case a tender offer made by the Company or any of its
subsidiaries for all or any portion of the Common Stock shall expire and
such tender offer (as amended upon the expiration thereof) shall require
the payment to stockholders (based on the acceptance (up to any maximum
specified in the terms of the tender offer) of Purchased Shares (as
defined below)) of an aggregate consideration having a fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and set forth in a Board Resolution) that combined together
with:
(1) the aggregate of the cash plus the fair market value (as
determined by the Board of Directors, whose determination shall be
conclusive and set forth in a Board Resolution), as of the
expiration of such tender offer, of consideration payable in respect
of any other tender offers, by the Company or any of its
subsidiaries for all or any portion of the Common Stock expiring
within the 12 months preceding the expiration of such tender offer
and in respect of which no adjustment pursuant to this Section
10.04(f) has been made, and
(2) the aggregate amount of any distributions to all holders
of the Company's Common Stock made exclusively in cash within 12
months preceding the expiration of such tender offer and in respect
of which no adjustment pursuant to Section 10.04(e) has been made,
exceeds 5% of the product of the Current Market Price (determined as
provided in Section 10.04(g)) as of the last time (the "Expiration
Time") tenders could have been made pursuant to such tender offer
(as it may be amended) times the number of shares of Common Stock
outstanding (including any tendered shares) on the Expiration Time,
then, and in each such case, immediately prior to the opening of
business on the day after the date of the Expiration Time, the
Conversion Price shall be adjusted so that the same shall equal the
price determined by multiplying the Conversion Price in effect
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immediately prior to close of business on the date of the Expiration
Time by a fraction:
(i) the numerator of which shall be the number of shares
of Common Stock outstanding (including any tendered shares) at
the Expiration Time multiplied by the Current Market Price of
the Common Stock on the Trading Day next succeeding the
Expiration Time, and
(ii) the denominator shall be the sum of (x) the fair
market value (determined as aforesaid) of the aggregate
consideration payable to stockholders based on the acceptance
(up to any maximum specified in the terms of the tender offer)
of all shares of Common Stock validly tendered and not
withdrawn as of the Expiration Time (the shares of Common
Stock deemed so accepted, up to any such maximum, being
referred to as the "Purchased Shares") and (y) the product of
the number of shares of Common Stock outstanding (less any
Purchased Shares) on the Expiration Time and the Current
Market Price of the Common Stock on the Trading Day next
succeeding the Expiration Time.
Such reduction (if any) shall become effective immediately prior to the
opening of business on the day following the Expiration Time. In the event
that the Company is obligated to purchase shares pursuant to any such
tender offer, but the Company is permanently prevented by applicable law
from effecting any such purchases or all such purchases are rescinded, the
Conversion Price shall again be adjusted to be the Conversion Price which
would then be in effect if such tender offer had not been made. If the
application of this Section 10.04(f) to any tender offer would result in
an increase in the Conversion Price, no adjustment shall be made for such
tender offer under this Section 10.04(f).
(g) If, after the date of issuance of the Notes, the Company pays a
dividend or makes a distribution to all holders of its Common Stock
consisting of Capital Stock of any class or series, or similar equity
interests, of or relating to a subsidiary or other business unit of the
Company, the Conversion Rate shall be adjusted in accordance with the
formula:
R' = R x (1 + F/M)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
"Conversion Rate" means the number of shares of Common Stock issuable upon
conversion of $1,000 aggregate principal amount of Notes, which shall initially
be 33.0565 shares per $1,000 aggregate principal amount of Notes.
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M = the average of the Post-Distribution Prices of the Common Stock for
the 10 trading days commencing on and including the fifth trading day after the
date on which "ex-dividend trading" commences for such dividend or distribution
on the principal United States exchange or market which such securities are then
listed or quoted (the "Ex-Dividend Date").
F = the fair market value of the securities distributed in respect of each
share of Common Stock for which this Section [___] shall mean the number of
securities distributed in respect of each share of Common Stock multiplied by
the average of the Post-Distribution Prices of those securities distributed for
the 10 trading days commencing on and including the fifth trading day after the
Ex-Dividend Date.
"Post-Distribution Price" of Capital Stock or any similar equity interest
on any date means the closing per unit sale price (or, if no closing sale price
is reported, the average of the bid and ask prices or, if more than one in
either case, the average of the average bid and the average ask prices) on such
date for trading of such units on a "when issued" basis without due bills (or
similar concept) as reported in the composite transactions for the principal
United States securities exchange on which such Capital Stock or equity interest
is traded or, if the Capital Stock or equity interest, as the case may be, is
not listed on a United States national or regional securities exchange, as
reported by the National Association of Securities Dealers Automated Quotation
System or by the National Quotation Bureau Incorporated; provided that if on any
date such units have not traded on a "when issued" basis, the Post-Distribution
Price shall be the closing per unit sale price (or, if no closing sale price is
reported, the average of the bid and ask prices or, if more than one in either
case, the average of the average bid and the average ask prices) on such date
for trading of such units on a "regular way" basis without due bills (or similar
concept) as reported in the composite transactions for the principal United
States securities exchange on which such Capital Stock or equity interest is
traded or, if the Capital Stock or equity interest, as the case may be, is not
listed on a United States national or regional securities exchange, as reported
by the National Association of Securities Dealers Automated Quotation System or
by the National Quotation Bureau Incorporated. In the absence of such quotation,
the Company shall be entitled to determine the Post-Distribution Price on the
basis of such quotations that reflect the post-distribution value of the Capital
Stock or equity interests as it considers appropriate.
(h) For purposes of this Section 10.04, the following terms shall
have the meanings indicated:
(1) "Current Market Price" shall mean the average of the daily
Closing Prices per share of Common Stock for the ten consecutive
Trading Days immediately prior to the date in question; provided,
however, that if:
(i) the "ex" date (as hereinafter defined) for any event
(other than the issuance or distribution requiring such
computation) that requires an adjustment to the Conversion
Price pursuant to Section 10.04(a), (b), (c), (d), (e) or (f)
occurs during such ten consecutive Trading Days, the Closing
Price for each Trading Day prior to the "ex" date for such
other event shall be adjusted by multiplying such Closing
Price by the same
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fraction by which the Conversion Price is so required to be
adjusted as a result of such other event;
(ii) the "ex" date for any event (other than the
issuance or distribution requiring such computation) that
requires an adjustment to the Conversion Price pursuant to
Section 10.04(a), (b), (c), (d), (e) or (f) occurs on or after
the "ex" date for the issuance or distribution requiring such
computation and prior to the day in question, the Closing
Price for each Trading Day on and after the "ex" date for such
other event shall be adjusted by multiplying such Closing
Price by the reciprocal of the fraction by which the
Conversion Price is so required to be adjusted as a result of
such other event; and
(iii) the "ex" date for the issuance or distribution
requiring such computation is prior to the day in question,
after taking into account any adjustment required pursuant to
clause (i) or (ii) of this proviso, the Closing Price for each
Trading Day on or after such "ex" date shall be adjusted by
adding thereto the amount of any cash and the fair market
value (as determined by the Board of Directors in a manner
consistent with any determination of such value for purposes
of Section 10.04(d) or (f), whose determination shall be
conclusive and set forth in a Board Resolution) of the
evidences of indebtedness, shares of Capital Stock or assets
being distributed applicable to one share of Common Stock as
of the close of business on the day before such "ex" date.
For purposes of any computation under Section 10.04(f), the Current Market
Price of the Common Stock on any date shall be deemed to be the average of
the daily Closing Prices per share of Common Stock for such day and the
next two succeeding Trading Days; provided, however, that if the "ex" date
for any event (other than the tender offer requiring such computation)
that requires an adjustment to the Conversion Price pursuant to Section
10.04(a), (b), (c), (d), (e) or (f) occurs on or after the Expiration Time
for the tender or exchange offer requiring such computation and prior to
the day in question, the Closing Price for each Trading Day on and after
the "ex" date for such other event shall be adjusted by multiplying such
Closing Price by the reciprocal of the fraction by which the Conversion
Price is so required to be adjusted as a result of such other event. For
purposes of this paragraph, the term "ex" date, when used:
(A) with respect to any issuance or distribution, means the
first date on which the Common Stock trades regular way on the
relevant exchange or in the relevant market from which the Closing
Price was obtained without the right to receive such issuance or
distribution;
(B) with respect to any subdivision or combination of shares
of Common Stock, means the first date on which the Common Stock
trades regular way on such exchange or in such market after the time
at which such subdivision or combination becomes effective, and
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(C) with respect to any tender or exchange offer, means the
first date on which the Common Stock trades regular way on such
exchange or in such market after the Expiration Time of such offer.
Notwithstanding the foregoing, whenever successive adjustments to the
Conversion Price are called for pursuant to this Section 10.04, such
adjustments shall be made to the Current Market Price as may be necessary
or appropriate to effectuate the intent of this Section 10.04 and to avoid
unjust or inequitable results as determined in good faith by the Board of
Directors.
(2) "fair market value" shall mean the amount which a willing
buyer would pay a willing seller in an arm's length transaction.
(3) "Record Date" shall mean, with respect to any dividend,
distribution or other transaction or event in which the holders of
Common Stock have the right to receive any cash, securities or other
property or in which the Common Stock (or other applicable security)
is exchanged for or converted into any combination of cash,
securities or other property, the date fixed for determination of
stockholders entitled to receive such cash, securities or other
property (whether such date is fixed by the Board of Directors or by
statute, contract or otherwise).
(i) The Company may make such reductions in the Conversion Price, in
addition to those required by Section 10.04(a), (b), (c), (d), (e) or (f),
as the Board of Directors considers to be advisable to avoid or diminish
any income tax to holders of Common Stock or rights to purchase Common
Stock resulting from any dividend or distribution of stock (or rights to
acquire stock) or from any event treated as such for income tax purposes.
To the extent permitted by applicable law, the Company from time to
time may reduce the Conversion Price by any amount for any period of time
if the period is at least 20 days and the reduction is irrevocable during
the period and the Board of Directors determines in good faith that such
reduction would be in the best interests of the Company, which
determination shall be conclusive and set forth in a Board Resolution.
Whenever the Conversion Price is reduced pursuant to the preceding
sentence, the Company shall mail to the Trustee and each Holder at the
address of such Holder as it appears in the Register a notice of the
reduction at least 15 days prior to the date the reduced Conversion Price
takes effect, and such notice shall state the reduced Conversion Price and
the period during which it will be in effect.
(j) No adjustment in the Conversion Price shall be required unless
such adjustment would require an increase or decrease of at least 1% in
such price; provided, however, that any adjustments which by reason of
this Section 10.04(j) are not required to be made shall be carried forward
and taken into account in any subsequent adjustment. All calculations
under this Article 10 shall be made by the Company and shall be made to
the nearest cent or to the nearest one hundredth of a share, as the case
may be. No
66
adjustment need be made for a change in the par value or no par value of
the Common Stock.
(k) In any case in which this Section 10.04 provides that an
adjustment shall become effective immediately after a Record Date for an
event, the Company may defer until the occurrence of such event (i)
issuing to the Holder of any Note converted after such Record Date and
before the occurrence of such event the additional shares of Common Stock
issuable upon such conversion by reason of the adjustment required by such
event over and above the Common Stock issuable upon such conversion before
giving effect to such adjustment and (ii) paying to such holder any amount
in cash in lieu of any fraction pursuant to Section 10.03 hereof.
(l) For purposes of this Section 10.04, the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of
scrip certificates issued in lieu of fractions of shares of Common Stock.
The Company will not pay any dividend or make any distribution on shares
of Common Stock held in the treasury of the Company.
(m) If the distribution date for the rights provided in the
Company's rights agreement, if any, occurs prior to the date a Note is
converted, the Holder of the Note who converts such Note after the
distribution date is not entitled to receive the rights that would
otherwise be attached (but for the date of conversion) to the shares of
Common Stock received upon such conversion; provided, however, that an
adjustment shall be made to the Conversion Price pursuant to Section
10.04(b) as if the rights were being distributed to the common
stockholders of the Company immediately prior to such conversion. If such
an adjustment is made and the rights are later redeemed, invalidated or
terminated, then a corresponding reversing adjustment shall be made to the
Conversion Price, on an equitable basis, to take account of such event.
SECTION 10.05 Notice of Adjustments of Conversion Price. Whenever
the Conversion Price is adjusted as herein provided (other than in the case of
an adjustment pursuant to the second paragraph of Section 10.04(i) for which the
notice required by such paragraph has been provided), the Company shall promptly
file with the Trustee and any Conversion Agent other than the Trustee an
Officers' Certificate setting forth the adjusted Conversion Price and showing in
reasonable detail the facts upon which such adjustment is based. Promptly after
delivery of such Officers' Certificate, the Company shall prepare a notice
stating that the Conversion Price has been adjusted and setting forth the
adjusted Conversion Price and the date on which each adjustment becomes
effective, and shall mail such notice to each Holder at the address of such
Holder as it appears in the Register within 20 days of the effective date of
such adjustment. Failure to deliver such notice shall not effect the legality or
validity of any such adjustment.
SECTION 10.06 Notice Prior to Certain Actions. In case at any time
after the date hereof:
67
(1) the Company shall declare a dividend (or any other distribution)
on its Common Stock payable otherwise than in cash out of its capital
surplus or its consolidated retained earnings;
(2) the Company shall authorize the granting to the holders of its
Common Stock of rights or warrants to subscribe for or purchase any shares
of Capital Stock of any class (or of securities convertible into shares of
Capital Stock of any class) or of any other rights;
(3) there shall occur any reclassification of the Common Stock of
the Company (other than a subdivision or combination of its outstanding
Common Stock, a change in par value, a change from par value to no par
value or a change from no par value to par value), or any merger,
consolidation, statutory share exchange or combination to which the
Company is a party and for which approval of any shareholders of the
Company is required, or the sale, transfer or conveyance of all or
substantially all of the assets of the Company; or
(4) there shall occur the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
the Company shall cause to be filed at each office or agency maintained for the
purpose of conversion of Notes pursuant to Section 4.05 hereof, and shall cause
to be provided to the Trustee and all Holders in accordance with Section 13.02
hereof, at least 20 days (or 10 days in any case specified in clause (1) or (2)
above) prior to the applicable record or effective date hereinafter specified, a
notice stating:
(A) the date on which a record is to be taken for the
purpose of such dividend, distribution, rights or warrants,
or, if a record is not to be taken, the date as of which the
holders of Common Stock of record to be entitled to such
dividend, distribution, rights or warrants are to be
determined, or
(B) the date on which such reclassification, merger,
consolidation, statutory share exchange, combination, sale,
transfer, conveyance, dissolution, liquidation or winding up
is expected to become effective, and the date as of which it
is expected that holders of Common Stock of record shall be
entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such
reclassification, merger, consolidation, statutory share
exchange, sale, transfer, dissolution, liquidation or winding
up.
Neither the failure to give such notice nor any defect therein shall
affect the legality or validity of the proceedings or actions described in
clauses (1) through (4) of this Section 10.06.
SECTION 10.07 Company to Reserve Common Stock. The Company shall at
all times use its best efforts to reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock, for the
purpose of effecting the conversion of Notes,
68
the full number of shares of fully paid and nonassessable Common Stock then
issuable upon the conversion of all Notes outstanding.
SECTION 10.08 Taxes on Conversions. Except as provided in the next
sentence, the Company will pay any and all taxes (other than taxes on income)
and duties that may be payable in respect of the issue or delivery of shares of
Common Stock on conversion of Notes pursuant hereto. A Holder delivering a Note
for conversion shall be liable for and will be required to pay any tax or duty
which may be payable in respect of any transfer involved in the issue and
delivery of shares of Common Stock in a name other than that of the Holder of
the Note or Notes to be converted, and no such issue or delivery shall be made
unless the Person requesting such issue has paid to the Company the amount of
any such tax or duty, or has established to the satisfaction of the Company that
such tax or duty has been paid.
SECTION 10.09 Covenant as to Common Stock. The Company covenants
that all shares of Common Stock which may be issued upon conversion of Notes
will upon issue be fully paid and nonassessable and, except as provided in
Section 10.08, the Company will pay all taxes, liens and charges with respect to
the issue thereof.
SECTION 10.10 Cancellation of Converted Notes. All Notes delivered
for conversion shall be delivered to the Trustee to be canceled by or at the
direction of the Trustee, which shall dispose of the same as provided in Section
2.10.
SECTION 10.11 Effect of Reclassification, Consolidation, Merger or
Sale. If any of following events occur, namely:
(1) any reclassification or change of the outstanding shares of
Common Stock (other than a change in par value, or from par value to no
par value, or from no par value to par value, or as a result of a
subdivision or combination),
(2) any merger, consolidation, statutory share exchange or
combination of the Company with another corporation as a result of which
holders of Common Stock shall be entitled to receive stock, securities or
other property or assets (including cash or any combination thereof) with
respect to or in exchange for such Common Stock or
(3) any sale or conveyance of the properties and assets of the
Company as, or substantially as, an entirety to any other corporation as a
result of which holders of Common Stock shall be entitled to receive
stock, securities or other property or assets (including cash or any
combination thereof) with respect to or in exchange for such Common Stock,
the Company or the successor or purchasing corporation, as the case may be,
shall execute with the Trustee a supplemental indenture (which shall comply with
the TIA as in force at the date of execution of such supplemental indenture if
such supplemental indenture is then required to so comply) providing that such
Note shall be convertible into the kind and amount of shares of stock and other
securities or property or assets (including cash or any combination thereof)
which such Holder would have been entitled to receive upon such
reclassification, change,
69
merger, consolidation, statutory share exchange, combination, sale or conveyance
had such Notes been converted into Common Stock immediately prior to such
reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance assuming such holder of Common Stock did not
exercise its rights of election, if any, as to the kind or amount of securities,
cash or other property receivable upon such reclassification, change, merger,
consolidation, statutory share exchange, combination, sale or conveyance
(provided that, if the kind or amount of securities, cash or other property
receivable upon such reclassification, change, merger, consolidation, statutory
share exchange, combination, sale or conveyance is not the same for each share
of Common Stock in respect of which such rights of election shall not have been
exercised ("Non-Electing Share"), then for the purposes of this Section 10.11
the kind and amount of securities, cash or other property receivable upon such
reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance for each Non-Electing Share shall be deemed to
be the kind and amount so receivable per share by a plurality of the
Non-Electing Shares). Such supplemental indenture shall provide for adjustments
which shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Article 10. If, in the case of any such reclassification,
change, merger, consolidation, statutory share exchange, combination, sale or
conveyance, the stock or other securities and assets receivable thereupon by a
holder of shares of Common Stock includes shares of stock or other securities
and assets of a corporation other than the successor or purchasing corporation,
as the case may be, in such reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or conveyance, then such
supplemental indenture shall also be executed by such other corporation and
shall contain such additional provisions to protect the interests of the Holders
of the Notes as the Board of Directors shall reasonably consider necessary by
reason of the foregoing, including to the extent practicable the provisions
providing for the repurchase rights set forth in Section 3.10 hereof.
The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each Holder, at the address of such Holder as it
appears on the Register, within 20 days after execution thereof. Failure to
deliver such notice shall not affect the legality or validity of such
supplemental indenture.
The above provisions of this Section 10.11 shall similarly apply to
successive reclassifications, mergers, consolidations, statutory share
exchanges, combinations, sales and conveyances.
If this Section 10.11 applies to any event or occurrence, Section
10.04 hereof shall not apply.
SECTION 10.12 Responsibility of Trustee for Conversion Provisions.
The Trustee, subject to the provisions of Section 7.01 hereof, and any
Conversion Agent shall not at any time be under any duty or responsibility to
any Holder of Notes to determine whether any facts exist which may require any
adjustment of the Conversion Price, or with respect to the nature or intent of
any such adjustments when made, or with respect to the method employed, or
herein or in any supplemental indenture provided to be employed, in making the
same. Neither the Trustee, subject to the provisions of Section 7.01 hereof, nor
any Conversion Agent shall be accountable with respect to the validity or value
(of the kind or amount) of any Common Stock, or of any other securities or
property, which may at any time be issued or delivered upon the conversion of
any Note; and it or they do not make any representation with respect thereto.
Neither the Trustee, subject to the provisions of Section 7.01 hereof, nor any
Conversion Agent
70
shall be responsible for any failure of the Company to make any cash payment or
to issue, transfer or deliver any shares of stock or share certificates or other
securities or property upon the surrender of any Note for the purpose of
conversion; and the Trustee, subject to the provisions of Section 7.01 hereof,
and any Conversion Agent shall not be responsible or liable for any failure of
the Company to comply with any of the covenants of the Company contained in this
Article.
ARTICLE 11
SUBORDINATION
SECTION 11.01 Agreement to Subordinate. The Company agrees, and each
Holder by accepting a Note agrees, that the Indebtedness, interest and other
obligations of any kind evidenced by the Notes and this Indenture (except as set
forth in this Section 11, with respect to Permitted Payments) are subordinated
in right of payment, to the extent and in the manner provided in this Article
11, to the prior payment in full in cash or cash equivalents of all Senior
Indebtedness (whether outstanding on the date hereof or hereafter created,
incurred, assumed or guaranteed), and that the subordination is for the benefit
of the holders of Senior Indebtedness.
SECTION 11.02 Liquidation; Dissolution; Bankruptcy. In the event of
any insolvency or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding in connection
therewith, relating to the Company or to its assets, or any liquidation,
dissolution or other winding-up of the Company, whether voluntary or
involuntary, or any assignment for the benefit of creditors or other marshaling
of assets or liabilities of the Company (except in connection with the
consolidation or merger of the Company or its liquidation or dissolution
following the conveyance, transfer or lease of all or substantially all of its
properties and assets upon the terms and conditions described in Article 5), the
holders of Senior Indebtedness will be entitled to receive payment in full of
all Senior Indebtedness, or provision shall be made for such payment in full,
before the Noteholders will be entitled to receive any payment or distribution
of any kind or character (other than Permitted Payments and Permitted Junior
Securities) on account of principal of, or premium, if any, or additional
interest, if any, or interest on the Notes; and any payment or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities (other than a payment or distribution in the form of Permitted
Payments and Permitted Junior Securities), by set-off or otherwise, to which the
Noteholders or the Trustee would be entitled but for the provisions of this
Article 11 shall be paid by the liquidating trustee or agent or other person
making such payment or distribution, whether a trustee in bankruptcy, a receiver
or liquidating trustee or otherwise, directly to the holders of Senior
Indebtedness or their representative or representatives ratably according to the
aggregate amounts remaining unpaid on account of the Senior Indebtedness to the
extent necessary to make payment in full of all Senior Indebtedness remaining
unpaid, after giving effect to any concurrent payment or distribution to the
holders of such Senior Indebtedness.
SECTION 11.03 Default on Designated Senior Indebtedness. (a) No
payment or distribution of any assets of the Company of any kind or character,
whether in cash, property or securities (other than Permitted Payments and
Permitted Junior Securities), may be made by or on behalf of the Company on
account of principal of, premium, if any, or interest on
71
the Notes or on account of the purchase, redemption or other acquisition of
Notes upon the occurrence of any default in payment (whether at Stated Maturity,
upon scheduled installment, by acceleration or otherwise) of principal of,
premium, if any, or interest on Designated Senior Indebtedness beyond any
applicable grace period (a "Payment Default") until such Payment Default shall
have been cured or waived in writing or shall have ceased to exist or such
Designated Senior Indebtedness shall have been discharged or paid in full in
cash or cash equivalents.
(b) No payment or distribution of any assets of the Company of any
kind or character, whether in cash, property or securities (other than Permitted
Payments and Permitted Junior Securities), may be made by or on behalf of the
Company on account of principal of, premium, if any, or interest on the Notes or
on account of the purchase, redemption or other acquisition of Notes for the
period specified below (a "Payment Blockage Period") upon the occurrence of any
default or event of default with respect to any Designated Senior Indebtedness
other than any Payment Default pursuant to which the maturity thereof may be
accelerated (a "Non-Payment Default") and receipt by the Trustee of written
notice thereof from the Company or the trustee or other representative of
holders of Designated Senior Indebtedness.
The Payment Blockage Period will commence upon the date of receipt
by the Trustee of written notice from the trustee or such other representative
of the holders of the Designated Senior Indebtedness in respect of which the
Non-Payment Default exists and shall end on the earliest of:
(i) 179 days thereafter (provided that any Designated Senior
Indebtedness as to which notice was given shall not theretofore have been
accelerated);
(ii) the date on which such Non-Payment Default is cured, waived or
ceases to exist;
(iii) the date on which such Designated Senior Indebtedness is
discharged or paid in full; or
(iv) the date on which such Payment Blockage Period shall have been
terminated by written notice to the Trustee or the Company from the
trustee or such other representative initiating such Payment Blockage
Period,
after which the Company will resume making any and all required payments in
respect of the Notes, including any missed payments. In any event, not more than
one Payment Blockage Period may be commenced during any period of 365
consecutive days. No Non-Payment Default that existed or was continuing on the
date of the commencement of any Payment Blockage Period will be, or can be made,
the basis for the commencement of a subsequent Payment Blockage Period, unless
such Non-Payment Default has been cured or waived for a period of not less than
90 consecutive days subsequent to the commencement of such initial Payment
Blockage Period.
SECTION 11.04 Acceleration of Notes. If payment of the Notes is
accelerated because of an Event of Default, the Company shall promptly notify
holders of Senior Indebtedness of the acceleration.
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SECTION 11.05 When Distribution Must Be Paid Over. In the event
that, notwithstanding the provisions of Sections 11.02 and 11.03, any payment or
distribution of any kind or character, whether in cash, property or securities,
shall be received by the Trustee or any Noteholder which is prohibited by such
provisions, then and in such event such payment shall be held in trust for the
benefit of, and shall be paid over and delivered by such Trustee or Noteholder
to, the trustee or any other representative of holders of Senior Indebtedness,
as their interest may appear, for application to Senior Indebtedness remaining
unpaid until all such Senior Indebtedness has been paid in full in cash or cash
equivalents after giving effect to any concurrent distribution to or for the
holders of Senior Indebtedness.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform only such obligations on the part of the Trustee as are
specifically set forth in this Article 11, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness, and shall not be
liable to any such holders if the Trustee shall pay over or distribute to or on
behalf of Noteholders or the Company or any other Person money or assets to
which any holders of Senior Indebtedness shall be entitled by virtue of this
Article 11, except if such payment is made as a result of the willful misconduct
or gross negligence of the Trustee.
SECTION 11.06 Notice by the Company. The Company shall promptly
notify the Trustee and the Paying Agent of any facts known to the Company that
would cause a payment of any obligations with respect to the Notes to violate
this Article 11, but failure to give such notice shall not affect the
subordination of the Notes to the Senior Indebtedness as provided in this
Article 11.
SECTION 11.07 Subrogation. After all Senior Indebtedness is paid in
full and until the Notes are paid in full, Noteholders shall be subrogated
(equally and ratably with all other Indebtedness that is equal in right of
payment to the Notes) to the rights of holders of Senior Indebtedness to receive
distributions applicable to Senior Indebtedness to the extent that distributions
otherwise payable to the Noteholders have been applied to the payment of Senior
Indebtedness. A distribution made under this Article 11 to holders of Senior
Indebtedness that otherwise would have been made to Noteholders is not, as
between the Company and Noteholders, a payment by the Company of the Notes.
SECTION 11.08 Relative Rights. This Article 11 defines the relative
rights of Holders and holders of Senior Indebtedness. Nothing in this Indenture
shall: (i) impair, as between the Company and Holders, the obligation of the
Company, which is absolute and unconditional, to pay principal of and interest
on the Notes in accordance with their terms; (ii) affect the relative rights of
Holders and creditors of Holdings other than their rights in relation to holders
of Senior Indebtedness; or (iii) prevent the Trustee or any Holder from
exercising its available remedies upon a Default or Event of Default, subject to
the rights of holders and owners of Senior Indebtedness to receive distributions
and payments otherwise payable to Holders of Notes. If the Company fails because
of this Article 11 to pay principal of or interest on a Note on the due date,
the failure is still a Default or Event of Default.
73
SECTION 11.09 Subordination May Not Be Impaired by the Company. No
right of any holder of Senior Indebtedness to enforce the subordination of the
Indebtedness evidenced by the Notes shall be impaired by any act or failure to
act by the Company or any Holder or by the failure of the Company or any Holder
to comply with this Indenture.
Without in any way limiting the generality of this Section 11.09,
the holders of Senior Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders, without
incurring responsibility to the Trustee or the Holders and without impairing or
releasing the subordination provided in this Article 11 or the obligations
hereunder of the Holders to the holders of Senior Indebtedness, do any one or
more of the following: (a) change the manner, place or terms of payment or
extend the time of payment of, or renew or alter, Senior Indebtedness or any
instrument evidencing the same or any agreement under which Senior Indebtedness
is outstanding or secured; (b) sell, exchange, release, foreclose against or
otherwise deal with any property pledged, mortgaged or otherwise securing Senior
Indebtedness; (c) release any Person liable in any manner for the collection of
Senior Indebtedness; and (d) exercise or refrain from exercising any rights
against the Company, any Subsidiary thereof or any other Person.
SECTION 11.10 Distribution or Notice to Representative. Whenever a
distribution is to be made or a notice given to holders of any Senior
Indebtedness, the distribution may be made and the notice given to their
representative.
Upon any payment or distribution of assets of the Company referred
to in this Article 11, the Trustee and the Holders of Notes shall be entitled to
rely upon any order or decree made by any court of competent jurisdiction or
upon any certificate of such representative(s) or 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, all holders of the Senior Indebtedness and other Indebtedness of
the Company, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this Article
11.
SECTION 11.11 Rights of Trustee and Paying Agent. Notwithstanding
the provisions of this Article 11 or any other provision of this Indenture, the
Trustee shall not be charged with knowledge of the existence of any facts that
would prohibit the making of any payment or distribution by the Trustee, and the
Trustee and the Paying Agent may continue to make payments on the Notes, unless
a Responsible Officer of the Trustee shall have received at its Corporate Trust
Office at least three Business Days prior to the date of such payment written
notice of facts that would cause the payment of any obligations with respect to
the Notes to violate this Article 11. Only the Company or representative may
give the notice. Nothing in this Article 11 shall impair the claims of, or
payments to, the Trustee under or pursuant to Section 7.06.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights.
74
ARTICLE 12
SECURITY
SECTION 12.01 Security. (a) On the Closing Date, the Company shall
(i) enter into the Pledge Agreement and comply with the terms and provisions
thereof and (ii) purchase the Pledged Securities to be pledged to the Trustee
for the benefit of the Holders in such amount as will be sufficient upon receipt
of scheduled interest and/or principal payments of such Pledged Securities to
provide for payment in full of the first six scheduled interest payments due on
the Notes. The Pledged Securities shall be pledged by the Company to the Trustee
for the benefit of the Holders and shall be held by the Trustee in the Pledge
Account pending disposition pursuant to the Pledge Agreement.
(b) Each Holder, by its acceptance of a Note, consents and agrees to
the terms of the Pledge Agreement (including, without limitation, the provisions
providing for foreclosure and release of the Pledged Securities) as the same may
be in effect or may be amended from time to time in accordance with its terms,
and authorizes and directs the Trustee to enter into the Pledge Agreement and to
perform its respective obligations and exercise its respective rights thereunder
in accordance therewith. The Company will do or cause to be done all such acts
and things as may be necessary or reasonably requested by the Trustee, or as may
be required by the provisions of the Pledge Agreement, to assure and confirm to
the Trustee the security interest in the Pledged Securities contemplated hereby,
by the Pledge Agreement or any part thereof, as from time to time constituted,
so as to render the same available for the security and benefit of this
Indenture and of the Notes secured hereby, according to the intent and purposes
herein and therein expressed. The Company shall take, or shall cause to be
taken, upon request of the Trustee, any and all actions reasonably required to
cause the Pledge Agreement to create and maintain, as security for the
obligations of the Company under this Indenture and the Notes, valid and
enforceable first priority liens in and on all the Pledged Securities, in favor
of the Trustee, superior to and prior to the rights of third Persons and subject
to no other Liens.
(c) The release of any Pledged Securities pursuant to the Pledge
Agreement will not be deemed to impair the security under this Indenture in
contravention of the provisions hereof if and to the extent the Pledged
Securities are released pursuant to this Indenture and the Pledge Agreement. To
the extent applicable, the Company shall cause TIA Section 314(d) relating to
the release of property or securities from the Lien and security interest of the
Pledge Agreement and relating to the substitution therefor of any property or
securities to be subjected to the Lien and security interest of the Pledge
Agreement to be complied with. Any certificate or opinion required by TIA
Section 314(d) may be made by an Officer of the Company, except in cases where
TIA Section 314(d) requires that such certificate or opinion be made by an
independent Person, which Person shall be an independent engineer, appraiser or
other expert selected by the Company.
(d) The Company shall cause TIA Section 314(b), relating to opinions
of counsel regarding the Lien under the Pledge Agreement, to be complied with.
The Trustee may accept, to the extent permitted by Sections 4.03 and 7.14 as
conclusive evidence of compliance with the foregoing provisions, the appropriate
statements contained in such instruments.
75
(e) The Trustee may, in its sole discretion and without the consent
of the Holders, on behalf of the Holders, take all reasonable actions in
accordance with the Pledge Agreement necessary or appropriate in order to (i)
enforce any of the terms of the Pledge Agreement and (ii) collect and receive
any and all amounts payable in respect of the obligations of the Company
thereunder. The Trustee shall have power to institute and to maintain such suits
and proceedings as the Trustee may reasonably deem expedient to preserve or
protect its interests and the interests of the Holders in the Pledged Securities
(including power to institute and maintain suits or proceedings to restrain the
enforcement of or compliance with any legislative or other governmental
enactment, rule or order that may be unconstitutional or otherwise invalid if
the enforcement of, or compliance with, such enactment, rule or order would
impair the security interest hereunder or be prejudicial to the interests of the
Holders or of the Trustee).
ARTICLE 13
MISCELLANEOUS
SECTION 13.01 Trust Indenture Act Controls. If any provision of this
Indenture limits, qualifies, or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
SECTION 13.02 Notices. Any request, demand, authorization, notice,
waiver, consent or communication shall be in writing and delivered in person or
mailed by first-class mail, postage prepaid, addressed as follows or transmitted
by facsimile transmission (confirmed by guaranteed overnight courier) to the
following facsimile numbers:
if to the Company:
Regeneron Pharmaceuticals, Inc.
000 Xxx Xxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Telephone No. (000) 000-0000
Facsimile No. (000) 000-0000
Attention: General Counsel
if to the Trustee:
American Stock Transfer & Trust Company
00 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Department
Telephone No. (000) 000-0000
Facsimile No. (000) 000-0000
The Company or the Trustee by notice given to the other in the
manner provided above may designate additional or different addresses for
subsequent notices or communications.
76
Any notice or communication given to a Noteholder shall be mailed to
the Noteholder, by first-class mail, postage prepaid, at the Noteholder's
address as it appears on the registration books of the Registrar and shall be
sufficiently given if so mailed within the time prescribed.
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, it is duly
given, whether or not received by the addressee.
If the Company mails a notice or communication to the Noteholders,
it shall mail a copy to the Trustee and each Registrar, Paying Agent, Conversion
Agent or co-registrar.
SECTION 13.03 Communication by Holders with Other Holders.
Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar, the Paying Agent, the Conversion Agent and
anyone else shall have the protection of TIA Section 312(c).
SECTION 13.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 13.05 Statements Required in Certificate or Opinion. Each
Officers' Certificate or Opinion of Counsel with respect to compliance with a
covenant or condition provided for in this Indenture shall include:
(1) a statement that each person making such Officers' Certificate
or Opinion of Counsel has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
Officers' Certificate or Opinion of Counsel are based;
(3) a statement that, in the opinion of each such person, he has
made such examination or investigation as is necessary to enable such
person to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(4) a statement that, in the opinion of such person, such covenant
or condition has been complied with.
77
SECTION 13.06 Separability Clause. In case any provision in this
Indenture or in the 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 13.07 Rules by Trustee, Paying Agent, Conversion Agent and
Registrar. The Trustee may make reasonable rules for action by or a meeting of
Noteholders. The Registrar, Conversion Agent and the Paying Agent may make
reasonable rules for their functions.
SECTION 13.08 Legal Holidays. A "Legal Holiday" is any day other
than a Business Day. If any specified date (including a date for giving notice)
is a Legal Holiday, the action shall be taken on the next succeeding day that is
not a Legal Holiday, and, if the action to be taken on such date is a payment in
respect of the Notes, no interest, if any, shall accrue for the intervening
period.
SECTION 13.09 GOVERNING LAW. THIS INDENTURE AND THE NOTES WILL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
SECTION 13.10 No Recourse Against Others. A director, officer,
employee or stockholder, as such, of the Company shall not have any liability
for any obligations of the Company under the Notes or this Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Note, each Noteholder shall waive and release all such
liability. The waiver and release shall be part of the consideration for the
issue of the Notes.
SECTION 13.11 Successors. All agreements of the Company in this
Indenture and the Notes shall bind its successor. All agreements of the Trustee
in this Indenture shall bind its successor.
SECTION 13.12 Multiple Originals. The parties may sign any number of
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.
78
IN WITNESS WHEREOF, the undersigned, being duly authorized, have
executed this Indenture on behalf of the respective parties hereto as of the
date first above written.
REGENERON PHARMACEUTICALS, INC.
By:___________________________
Name:
Title:
AMERICAN STOCK TRANSFER &
TRUST COMPANY, as Trustee
By:___________________________
Name:
Title:
EXHIBIT A-1
[FORM OF FACE OF GLOBAL NOTE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY, OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN ARTICLE TWO OF THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE, THE
SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE NOR ANY INTEREST OR
PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER,
SELL, OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH REGENERON PHARMACEUTICALS,
INC. (THE "COMPANY") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE
(OR ANY PREDECESSOR OF SUCH NOTE) ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY
THEREOF, (B) FOR SO LONG AS THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE
UPON CONVERSION OF THIS NOTE ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO AN EXEMPTION
A-1-1
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT, IF AVAILABLE,
(D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT AND CONTINUES TO BE EFFECTIVE AT THE TIME OF TRANSFER OR (E)
IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT. IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSES (C) OR (E)
ABOVE, SUCH TRANSFER IS SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHTS PRIOR
TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM
APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRUSTEE. THE HOLDER AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN PURSUANT TO
CLAUSE D ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND
WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE.
[THE FOREGOING LEGEND MAY BE REMOVED FROM THIS NOTE ON SATISFACTION OF
THE CONDITIONS SPECIFIED IN THE INDENTURE.]
A-1-2
REGENERON PHARMACEUTICALS, INC.
5-1/2% Convertible Senior Subordinated Notes due 2008
No.: 1 CUSIP: 00000XXX0
Issue Date: October 17, 2001
REGENERON PHARMACEUTICALS, INC., a New York corporation, promises to
pay to Cede & Co. or registered assigns, the principal sum of TWO HUNDRED
MILLION DOLLARS ($200,000,000) on October 17, 2008.
This Note shall bear interest as specified on the other side of this
Note. This Note is convertible as specified on the other side of this Note.
Additional provisions of this Note are set forth on the other side of
this Note.
Dated: October 17, 2001 REGENERON PHARMACEUTICALS, INC.
By
--------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
AMERICAN STOCK TRANSFER
& TRUST COMPANY,
as Trustee, certifies that this
is one of the Notes referred
to in the within-mentioned Indenture (as
defined on the other side of this Note).
By
----------------------------------
Authorized Signatory
Dated:
--------------------------------
A-1-3
[FORM OF REVERSE SIDE OF NOTE]
5-1/2% Convertible Senior Subordinated Note due 2008
1. Cash Interest.
The Company promises to pay interest in cash on the principal amount of
this Note at the rate per annum of 5-1/2%. The Company will pay cash interest
semiannually in arrears on April 17 and October 17 of each year (each an
"Interest Payment Date") to Holders of record at the close of business on April
2 and October 2 (whether or not a business day) (each a "Regular Record Date"),
as the case may be, immediately preceding such Interest Payment Date. Cash
interest on the Notes will accrue from the most recent date to which interest
has been paid or duly provided or, if no interest has been paid, from the Issue
Date. Cash interest will be computed on the basis of a 360-day year of twelve
30-day months.
In accordance with the terms of the Registration Rights Agreement,
during the first 90 days following the day on which an Event (as defined in the
Registration Rights Agreement) has occurred and is continuing, the Interest Rate
borne by the Notes shall be increased by .25% to 5.75%. From and after the 91st
day following the day on which an Event has occurred and such Event is
continuing, the Interest Rate borne by the Notes shall be increased by an
additional .25% to 6.00%. In no event shall the Interest Rate borne by the Notes
exceed 6.00%. Any amount of additional interest will be payable in cash
semiannually, in arrears, on each Interest Payment Date and will cease to accrue
on the date the Event is cured. The Holder of this Security is entitled to the
benefits of the Registration Rights Agreement.
The Holder of this Note is entitled to the benefits of the Pledge
Agreement, dated October 17, 2001, between the Company and the Trustee, pursuant
to which the Company has placed in the Pledge Account cash or Pledged Financial
Assets sufficient to provide for the payment of the first six interest payments
on this Note. The terms capitalized but undefined in this paragraph have the
meanings given to them in the Pledge Agreement.
2. Method of Payment.
Subject to the terms and conditions of the Indenture, the Company will
make payments in respect of the principal of, premium, if any, and cash interest
on this Note to a Paying Agent. In respect of Redemption Prices and Change of
Control Repurchase Prices, the Company will make payments in respect of the
principal of, premium, if any, and cash interest on this Note to Holders who
surrender Notes to a Paying Agent to collect such payments in respect of the
Notes. The Company will pay cash amounts 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 make such cash payments by check payable in such money.
A holder of Notes with an aggregate principal amount in excess of $10,000,000
will be paid by wire transfer in immediately available funds at the election of
such holder. Any payment required to be made on any day that is not a Business
Day will be made on the next succeeding Business Day.
A-1-4
3. Paying Agent, Conversion Agent and Registrar.
Initially, American Stock Transfer & Trust Company (the "Trustee"),
will act as Paying Agent, Conversion Agent and Registrar. The Company may
appoint and change any Paying Agent, Conversion Agent, Registrar or co-registrar
without notice, other than notice to the Trustee, except that the Company will
maintain at least one Paying Agent in the State of New York, City of New York,
Borough of Manhattan, which shall initially be an office or agency of the
Trustee. The Company or any of its Subsidiaries or any of their Affiliates may
act as Paying Agent, Conversion Agent, Registrar or co-registrar.
4. Indenture.
The Company issued the Notes under an Indenture dated as of October 17,
2001 (the Indenture"), between the Company and the Trustee. The terms of the
Notes include those stated in the Indenture and those made part of the Indenture
by reference to the Trust Indenture Act of 1939, as in effect from time to time
(the "TIA"). Capitalized terms used herein and not defined herein have the
meanings ascribed thereto in the Indenture. The Notes are subject to all such
terms, and Noteholders are referred to the Indenture and the TIA for a statement
of those terms.
The Notes are general unsecured obligations of the Company (except as
provided in Article 12 of the Indenture) limited to $200,000,000 aggregate
principal amount. Subject to Section 4.07 of the Indenture, the Indenture does
not limit other indebtedness of the Company, secured or unsecured.
5. Provisional Redemption.
The Notes may be redeemed at the election of the Company, as a whole or
from time to time in part on any date, upon not less than 30 nor more than 60
days' notice, at any time prior to October 17, 2004, at a Redemption Price equal
to $1,000 per $1,000 principal amount of the Notes plus accrued and unpaid
interest, if any, to but excluding the Provisional Redemption Date if (i) the
Closing Price of the Common Stock has exceeded 150% of the Conversion Price (as
defined in Article 10 of the Indenture and as such may be adjusted from time to
time) then in effect for at least 20 Trading Days in any consecutive 30-Trading
Day period ending on the Trading Day prior to the Notice Date and (ii) during
the period that the Company is obligated, under the Registration Rights
Agreement, to keep a registration statement covering resales of the Notes and
the Common Stock issuable upon conversion thereof effective, such registration
statement is effective (the "Registration Period") and available for use as of,
and including, the Notice Date through and including the Provisional Redemption
Date provided this date is within the Registration Period.
Upon any such Provisional Redemption, the Company shall make the
Make-Whole Payment with respect to the Notes called for redemption to Holders on
the Notice Date in an amount equal to $165 per $1,000 principal amount of the
Notes, less the amount of any interest actually paid on such Notes prior to or
on the Provisional Redemption Date. The Company shall make the Make-Whole
Payment in cash on all Notes called for Provisional Redemption, including those
Notes converted into Common Stock between the Notice Date and the Provisional
Redemption Date.
A-1-5
6. Optional Redemption.
At any time on or after October 17, 2004, the Company may
redeem the Notes in whole at any time or in part from time to time upon not less
than 30 nor more than 60 days' notice, at a redemption price equal to $1,000 per
$1,000 principal amount, plus any interest accrued but not paid prior to the
Redemption Date, subject to the right of Holders of record on the immediately
preceding Regular Record Date to receive the interest due on the succeeding
Interest Payment Date if the Closing Price of the Common Stock has exceeded 140%
of the Conversion Price (as such may be adjusted from time to time) then in
effect for at least 20 Trading Days in any consecutive 30-Trading Day period
ending on the Trading Day prior to the date of mailing of the notice of optional
redemption pursuant to Section 3.05 of the Indenture.
If the Company does not redeem all the Notes, the Trustee will select
the Notes to be redeemed in principal amounts of $1,000 or whole multiples of
$1,000 by lot or on a pro rata basis. If any Notes are to be redeemed in part
only, a new Note or Notes in principal amount equal to the unredeemed principal
portion thereof will be issued. If a portion of a Holder's Notes is selected for
partial redemption and the Holder converts a portion of its Notes, the converted
portion will be deemed to be taken from the portion selected for redemption.
No sinking fund is provided for the Notes.
7. Repurchase by the Company at the Option of the Holder.
If a Change of Control occurs, the Holder, at the Holder's option,
shall have the right, in accordance with the provisions of the Indenture, to
require the Company to repurchase the Notes (or any portion of the principal
amount hereof that is at least $1,000 or an integral multiple thereof, provided
that the portion of the principal amount of this Note to be outstanding after
such repurchase is at least equal to $1,000) at the Change of Control Repurchase
Price in cash (or Common Stock subject to the following paragraph), plus any
interest accrued and unpaid to, but excluding, the Change of Control Repurchase
Date.
Subject to the conditions provided in the Indenture, the Company may
elect to pay the Change of Control Repurchase Price by delivering a number of
shares of Common Stock equal to (i) the Change of Control Repurchase Price
divided by (ii) 95% of the average of the Closing Prices per share for the five
consecutive Trading Days ending on the third Trading Day prior to the Change of
Control Repurchase Date.
No fractional shares of Common Stock will be issued upon repurchase of
any Notes. Instead of any fractional share of Common Stock which would otherwise
be issued upon conversion of such Notes, the Company shall pay a cash adjustment
as provided in the Indenture.
A Change of Control Repurchase Notice will be given by the Company to
the Holders as provided in the Indenture. To exercise a repurchase right, a
Holder must deliver to the Trustee a written notice as provided in the
Indenture.
Holders have the right to withdraw any Change of Control Repurchase
Notice by delivering to the Paying Agent a written notice of withdrawal in
accordance with the provisions of the Indenture.
A-1-6
8. Notice of Redemption.
Notice of redemption will be mailed not less than 30 days but not more
than 60 days before the Redemption Date to each Holder of Notes to be redeemed
at the Holder's registered address. If money sufficient to pay the Redemption
Price of all Notes (or portions thereof) to be redeemed on the Redemption Date
is deposited with the Paying Agent prior to or on the Redemption Date,
immediately after such Redemption Date interest ceases to accrue on such Notes
or portions thereof. Notes in denominations larger than $1,000 of principal
amount may be redeemed in part but only in integral multiples of $1,000 of
principal amount.
9. Conversion.
Subject to the next two succeeding sentences, a Holder of a Note may
convert it into Common Stock of the Company at any time before the close of
business on October 17, 2008. If the Note is called for redemption, the Holder
may convert it at any time before the close of business on the Business Day
preceding the Redemption Date. A Note in respect of which a Holder has delivered
a Change of Control Repurchase Notice exercising the option of such Holder to
require the Company to purchase such Note may be converted only if such notice
of exercise is withdrawn in accordance with the terms of the Indenture.
The initial Conversion Price shall be $30.2512 per share of Common
Stock, subject to adjustment in certain events described in the Indenture. The
Company shall pay a cash adjustment as provided in the Indenture in lieu of any
fractional share of Common Stock.
To convert a Note, a Holder must (1) complete and manually sign the
conversion notice below (or complete and manually sign a facsimile of such
notice) and deliver such notice to the Conversion Agent, (2) surrender the Note
duly signed and endorsed to the Conversion Agent, (3) furnish appropriate
endorsements and transfer documents if required by the Conversion Agent, the
Company or the Trustee and (4) pay any transfer or similar tax or payment
detailed below, if required.
Notes surrendered for conversion, other than those called for
Provisional Redemption or Optional Redemption, during the period from the close
of business on any Regular Record Date to the opening of business on the next
succeeding Interest Payment Date shall be accompanied by payment in New York
Clearing House funds or other funds acceptable to the Company of an amount equal
to the interest to be received on such Interest Payment Date on the principal
amount of Notes being surrendered for conversion. No such payment will be
required if the Notes are called for Provisional Redemption or Optional
Redemption.
10. Conversion Arrangement on Call for Redemption.
Any Notes called for redemption, unless surrendered for conversion
before the close of business on the Redemption Date, may be deemed to be
purchased from the Holders of such Notes at an amount not less than the
Redemption Price, by one or more investment bankers or other purchasers who may
agree with the Company to purchase such Notes from the Holders, to convert them
into Common Stock of the Company and to make payment for such Notes to the
Trustee in trust for such Holders.
A-1-7
11. Denominations; Transfer; Exchange.
The Notes are in fully registered form, without coupons, in
denominations of $1,000 of principal amount and integral multiples of $1,000. A
Holder may transfer or exchange Notes in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not transfer or exchange
(i) any Notes selected for redemption (except, in the case of a Note to be
redeemed in part, the portion of the Note not to be redeemed), (ii) any Notes in
respect of which a Change of Control Repurchase Notice has been given and not
withdrawn (except, in the case of a Note to be purchased in part, the portion of
the Note not to be purchased) or (iii) any Notes for a period of 15 days before
the mailing of a notice of redemption of Notes to be redeemed.
12. Persons Deemed Owners.
The registered Holder of this Note may be treated as the owner of this
Note for all purposes.
13. Unclaimed Money or Notes.
The Trustee and the Paying Agent shall return to the Company upon
written request any money or Notes held by them for the payment of any amount
with respect to the Notes that remains unclaimed for two years, subject to
applicable unclaimed property law. After return to the Company, Holders entitled
to the money or Notes must look to the Company for payment as general creditors
unless an applicable abandoned property law designates another person.
14. Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Notes may be amended with the written consent of the Holders of
at least a majority in aggregate principal amount of the Notes at the time
outstanding and (ii) certain Defaults may be waived with the written consent of
the Holders of a majority in aggregate principal amount of the Notes at the time
outstanding. Subject to certain exceptions set forth in the Indenture, without
the consent of any Noteholder, the Company and the Trustee may amend the
Indenture or the Notes to cure any ambiguity, omission, defect or inconsistency,
or to comply with Article 5 of the Indenture, to make any change that does not
adversely affect the rights of any Noteholder, or to comply with any requirement
of the SEC in connection with the qualification of the Indenture under the TIA.
15. Defaults and Remedies.
Under the Indenture, Events of Default include (1) the Company fails to
pay when due the principal of or premium, if any, on any of the Notes at
maturity, upon redemption or exercise of a repurchase right or otherwise,
whether or not such payment is prohibited by Article 11 of the Indenture; (2)
the Company fails to pay an installment of interest (including liquidated
damages, if any) on any of the Notes that continues for 30 days after the date
when due, whether or not such payment is prohibited by Article 11 of the
Indenture, provided that a failure to make any of the first six scheduled
interest payments on the Notes within 3 Business Days after an Interest Payment
Date will constitute an Event of Default with no additional grace or cure
period; (3) the
A-1-8
Company fails to deliver shares of Common Stock, together with cash in lieu of
fractional shares, when such Common Stock or cash in lieu of fractional shares
is required to be delivered upon conversion of a Note and such failure continues
for 10 days after such delivery date; (4) the Company fails to perform or
observe any other term, covenant or agreement contained in the Notes or the
Indenture for a period of 60 days after written notice of such failure,
requiring the Company to remedy the same, shall have been given to the Company
by the Trustee or to the Company and the Trustee by the Holders of at least 25%
in aggregate principal amount of the Notes then outstanding; (5) (A) one or more
defaults in the payment of principal of or premium, if any, on any of the
Company's Indebtedness aggregating $10.0 million or more, when the same becomes
due and payable at the scheduled maturity thereof, and such default or defaults
shall have continued after any applicable grace period and shall not have been
cured or waived within a 30-day period after the date of such default or (B) any
of the Company's Indebtedness aggregating $10.0 million or more shall have been
accelerated or otherwise declared due and payable, or required to be prepaid or
repurchased (other than by regularly scheduled required prepayment) prior to the
scheduled maturity thereof and such acceleration is not rescinded or annulled
within a 30-day period after the date of such acceleration; and (6) certain
events of bankruptcy, insolvency or reorganization with respect to the Company
or any Significant Subsidiary. If an Event of Default (other than an Event of
Default specified in clause (6) above) occurs and is continuing, the Trustee, or
the Holders of at least 25% in aggregate principal amount of the Notes at the
time outstanding, may declare all the Notes to be due and payable immediately.
Certain events of bankruptcy or insolvency are Events of Default which will
result in the Notes becoming due and payable immediately upon the occurrence of
such Events of Default.
Noteholders may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Notes unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in aggregate principal amount of the
Notes at the time outstanding may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Noteholders notice of any
continuing Default (except a Default in payment of amounts specified in clause
(1) or (2) above) if it determines that withholding notice is in their
interests.
16. Subordination
The payment of principal of, premium, if any, and interest on the Notes
will be subordinated (except as provided in Article 12 of the Indenture) in
right of payment, as set forth in the Indenture, to the prior payment in full in
cash or cash equivalents of all Senior Indebtedness whether outstanding on the
date of the Indenture or thereafter incurred.
17. Trustee Dealings with the Company.
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Notes and may otherwise deal with and collect obligations owed to it
by the Company or its Affiliates and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee.
A-1-9
18. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company under the Notes
or the Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Note, each Noteholder waives and
releases all such liability. The waiver and release are part of the
consideration for the issue of the Notes.
19. Authentication.
This Note shall not be valid until an authorized signatory of the
Trustee manually signs the Trustee's Certificate of Authentication on the other
side of this Note.
20. Abbreviations.
Customary abbreviations may be used in the name of a Noteholder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
21. GOVERNING LAW.
THE INDENTURE AND THIS NOTE WILL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
The Company will furnish to any Noteholder upon written request and
without charge a copy of the Indenture which has in it the text of this Note in
larger type. Requests may be made to:
General Counsel
Regeneron Pharmaceuticals, Inc.
000 Xxx Xxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
A-1-10
ASSIGNMENT FORM
To assign this Note, fill in the form below:
I or we assign and transfer this Note to
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax ID no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
_____________________ agent to transfer this Note on the books of the Company.
The agent may substitute another to act for him.
CONVERSION NOTICE
To convert this Note into Common Stock of the Company, check the box:
9
To convert only part of this Note, state the principal amount to be converted
(which must be $1,000 or an integral multiple of $1,000):
$
--------------------------
If you want the stock certificate made out in another person's name, fill in the
form below:
------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Insert other person's soc. sec. or tax ID no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type other person's name, address and zip code)
------------------------------------------------------------------------------
Date: Your Signature:
----------------------- -----------------------------------
------------------------------------------------------------------------------
(Sign exactly as your name appears on the other side of this Note)
A-1-11
EXHIBIT A-2
[Form of Certificated Note]
THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE, THE
SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE NOR ANY INTEREST OR
PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER,
SELL, OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH REGENERON PHARMACEUTICALS,
INC. (THE "COMPANY") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE
(OR ANY PREDECESSOR OF SUCH NOTE) ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY
THEREOF, (B) FOR SO LONG AS THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE
UPON CONVERSION OF THIS NOTE ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO AN EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT, IF AVAILABLE,
(D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT AND CONTINUES TO BE EFFECTIVE AT THE TIME OF TRANSFER OR (E)
IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSES (C) OR (E) ABOVE,
SUCH TRANSFER IS SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHTS PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH
OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE
OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE. THE HOLDER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE
SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN PURSUANT TO CLAUSE D ABOVE)
A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
A-2-1
[THE FOREGOING LEGEND MAY BE REMOVED FROM THIS NOTE ON SATISFACTION OF
THE CONDITIONS SPECIFIED IN THE INDENTURE.]
A-2-2
REGENERON PHARMACEUTICALS, INC.
5-1/2% Convertible Senior Subordinated Notes due 2008
No. CUSIP: 00000XXX0
Issue Date: October 17, 2001
REGENERON PHARMACEUTICALS, INC., a New York corporation, promises to
pay to Cede & Co. or registered assigns, the principal sum of TWO HUNDRED
MILLION DOLLARS ($200,000,000) on October 17, 2008.
This Note shall bear interest as specified on the other side of this
Note. This Note is convertible as specified on the other side of this Note.
Additional provisions of this Note are set forth on the other side of
this Note.
Dated: REGENERON PHARMACEUTICALS, INC.
By
--------------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
AMERICAN STOCK TRANSFER
& TRUST COMPANY,
as Trustee, certifies that this
is one of the Notes referred
to in the within-mentioned Indenture (as
defined on the other side of this Note).
By
-----------------------------------
Authorized Signatory
Dated:
--------------------------------
A-2-3
EXHIBIT B-1
Transfer Certificate
In connection with any transfer of any of the Notes within the period
prior to the expiration of the holding period applicable to the sales thereof
under Rule 144(k) under the Securities Act of 1933, as amended (the "Securities
Act") (or any successor provision), the undersigned registered owner of this
Note hereby certifies with respect to $____________ principal amount of the
above-captioned Notes presented or surrendered on the date hereof (the
"Surrendered Notes") for registration of transfer, or for exchange or conversion
where the Notes issuable upon such exchange or conversion are to be registered
in a name other than that of the undersigned registered owner (each such
transaction being a "transfer"), that such transfer complies with the
restrictive legend set forth on the face of the Surrendered Notes for the reason
checked below:
[ ] A transfer of the Surrendered Notes is made to the Company or
any subsidiaries; or
[ ] The transfer of the Surrendered Notes complies with Rule 144A
under the U.S. Securities Act of 1933, as amended (the
"Securities Act"); or
[ ] The transfer of the Surrendered Notes is to an institutional
accredited investor, as described in Rule 501(a)(1), (2), (3)
or (7) of Regulation D under the Securities Act; or
[ ] The transfer of the Surrendered Notes is pursuant to an
effective registration statement under the Securities Act, or
[ ] The transfer of the Surrendered Notes is pursuant to an
offshore transaction in accordance with Rule 904 of Regulation
S under the Securities Act; or
[ ] The transfer of the Surrendered Notes is pursuant to another
available exemption from the registration requirement of the
Securities Act.
and unless the box below is checked, the undersigned confirms that, to the
undersigned's knowledge, such Notes are not being transferred to an "affiliate"
of the Company as defined in Rule 144 under the Securities Act (an "Affiliate").
[ ] The transferee is an Affiliate of the Company.
DATE:
-------------------- --------------------------------------
Signature(s)
(If the registered owner is a corporation, partnership or
fiduciary, the title of the Person signing on behalf of
such registered owner must be stated.)
B-1-1
EXHIBIT B-2
Form of Letter to Be Delivered by Accredited Investors
Regeneron Pharmaceuticals, Inc.
000 Xxx Xxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx, General Counsel
American Stock Transfer & Trust Company
00 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Department
Telephone No. (000) 000-0000
Facsimile No. (000) 000-0000
Dear Sirs:
We are delivering this letter in connection with the proposed transfer
of $_____________ principal amount of the 5-1/2% Convertible Senior Subordinated
Notes due 2008 (the "Notes") of Regeneron Pharmaceuticals, Inc. (the "Company"),
which are convertible into shares of the Company's Common Stock, $0.001 par
value per share (the "Common Stock").
We hereby confirm that:
(i) we are an "accredited investor" within the meaning of Rule
501(a)(1), (2) or (3) under the Securities Act of 1933, as amended (the
"Securities Act"), or an entity in which all of the equity owners are
accredited investors within the meaning of Rule 501(a)(1), (2) or (3)
under the Securities Act (an "Institutional Accredited Investor");
(ii) the purchase of Notes by us is for our own account or for
the account of one or more other Institutional Accredited Investors or
as fiduciary for the account of one or more trusts, each of which is an
"accredited investor" within the meaning of Rule 501(a)(7) under the
Securities Act and for each of which we exercise sole investment
discretion or (B) we are a "bank," within the meaning of Section
3(a)(2) of the Securities Act, or a "savings and loan association" or
other institution described in Section 3(a)(5)(A) of the Securities Act
that is acquiring Notes fiduciary for the account of one or more
institutions for which we exercise sole investment discretion;
(iii) we have such knowledge and experience in financial and
business matters that we are capable of evaluating the merits and risks
of purchasing Notes; and
(iv) we are not acquiring Notes with a view to distribution
thereof or with any present intention of offering or selling Notes or
the Common Stock issuable upon conversion thereof, except as permitted
below; provided that the disposition of our
B-2-1
property and property of any accounts for which we are acting as
fiduciary shall remain at all times within our control.
We understand that the Notes were originally offered and sold in a
transaction not involving any public offering within the United States within
the meaning of the Securities Act and that the Notes and the shares of Common
Stock (the "Notes") issuable upon conversion thereof have not been registered
under the Securities Act, and we agree, on our own behalf and on behalf of each
account for which we acquire any Notes, that if in the future we decide to
resell or otherwise transfer such Notes prior to the date (the "Resale
Restriction Termination Date") which is two years after the later of the
original issuance of the Notes and the last date on which the Company or an
affiliate of the Company was the owner of the Note, such Notes may be resold or
otherwise transferred only (i) to the Company or any subsidiary thereof, or (ii)
for as long as the Notes are eligible for resale pursuant to Rule 144A, to a
person it reasonably believes is a "qualified institutional buyer" (as defined
in Rule 144A under the Securities Act) that purchases for its own account or for
the account of a qualified institutional buyer to which notice is given that the
transfer is being made in reliance on Rule 144A, or (iii) to an Institutional
Accredited Investor that is acquiring the Note for its own account, or for the
account of such Institutional Accredited Investor for investment purposes and
not with a view to, or for offer or sale in connection with, any distribution in
violation of the Securities Act, or (iv) pursuant to another available exemption
from registration under the Securities Act (if applicable), or (v) pursuant to a
registration statement which has been declared effective under the Securities
Act and, in each case, in accordance with any applicable securities laws of any
State of the United States or any other applicable jurisdiction and in
accordance with the legends set forth on the Notes. We further agree to provide
any person purchasing any of the Notes other than pursuant to clause (v) above
from us a notice advising such purchaser that resales of such Notes are
restricted as stated herein. We understand that the trustee or the transfer
agent, as the case may be, for the Notes will not be required to accept for
registration of transfer any Notes pursuant to (iii) or (iv) above except upon
presentation of evidence satisfactory to the Company that the foregoing
restrictions on transfer have been complied with. We further understand that any
Notes will be in the form of definitive physical certificates and that such
certificates will bear a legend reflecting the substance of this paragraph other
than certificates representing Notes transferred pursuant to clause (v) above.
We acknowledge that the Company, others and you will rely upon our
confirmations, acknowledgments and agreements set forth herein, and we agree to
notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.
B-2-2
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK.
(Name of Purchaser)
By:
----------------------------------
Name:
Title:
Address:
B-2-3
