EXHIBIT 10.70
TALK AMERICA HOLDINGS, INC.
To
WILMINGTON TRUST COMPANY
Trustee
____________________________
SUPPLEMENTAL INDENTURE NO. 1
----------------------------
Dated as of April 2, 2002
to
INDENTURE
---------
Dated as of April 2, 2002
____________________________
U.S. $2,822,400
8% Convertible Senior Subordinated Notes due August 15, 2007
TALK AMERICA HOLDINGS, INC.
SUPPLEMENTAL INDENTURE NO. 1
Dated as of April 2, 2002
8% Convertible Senior Subordinated Notes due August 15, 2007
SUPPLEMENTAL INDENTURE NO. 1, dated as of April 2, 2002, between TALK AMERICA
HOLDINGS, INC., a corporation duly organized and existing under the laws of the
State of Delaware with executive offices located at 00000 Xxxxxxx Xxxxxx Xxxxx,
Xxxxx 000, Xxxxxx, Xxxxxxxx 00000 (hereinafter sometimes called the "Company")
and Wilmington Trust Company, with offices located at Xxxxxx Square North, 0000
Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000 (hereinafter sometimes called the
"Trustee") as Trustee under an indenture of the Company (the "Indenture") dated
as of April 2, 2002.
RECITALS OF THE COMPANY
Section 301 of the Indenture provides for the issuance from time to time of
debentures, notes, bonds or other evidences of indebtedness (the "Securities")
of the Company in series, issuable for the purposes and subject to the
limitations contained in the Indenture. The Company has duly authorized the
creation of a series of its Securities titled its 8% Convertible Senior
Subordinated Notes Due August 15, 2007 of the tenor and in the amount
hereinafter set forth.
Section 901 of the Indenture provides that the Company, when authorized by
a resolution of its Board of Directors, and the Trustee may from time to time
and at any time enter into one or more indentures supplemental to the Indenture
to establish, among other things, the form and terms of Securities of any series
as permitted by Section 301 of the Indenture and to add to the covenants of the
Company for the benefit of the Holders of all or any series of Securities or to
surrender any right or power therein conferred upon the Company.
The Company has duly authorized the execution and delivery of this
Supplemental Indenture No. 1, and all things necessary have been done to make
the Notes (as defined below), when executed by the Company and authenticated and
delivered hereunder and duly issued by the Company, the valid obligations of the
Company, and to make this Supplemental Indenture No. 1 a valid agreement of the
Company, in accordance with its terms.
NOW, THEREFORE, THIS SUPPLEMENTAL
INDENTURE NO. 1 WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
of the series provided for herein, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Securities of such series,
as follows:
ARTICLE I
The Series of Securities
---------------------------
Section 1.01 There shall be a series of Securities designated the 8%
Convertible Senior Subordinated Notes due August 15, 2007 of the Company
(herein, the "Notes"), limited in aggregate principal amount to $2,822,400
(except for: (i) Notes authenticated and delivered upon registration of transfer
of, or in exchange for, or in lieu of, other Notes of the series pursuant to
Section 304, 305, 306, 906 or 1107 of the Indenture and (ii) any Notes that,
pursuant to Section 303 of the Indenture, are deemed never to have been
authenticated and delivered hereunder).
Section 1.02 Each Note shall be substantially in the form and contain the
terms and provisions set forth in the form of Note attached hereto as Exhibit A
and incorporated by reference herein. The provisions of the Indenture relating
to Book-Entry Securities shall be applicable to the Notes including, without
limitation, the provisions of Sections 202, 305 and 310 of the Indenture. If any
provision of this Supplemental Indenture No. 1 limits, qualifies, or conflicts
with any term or provision of the Notes, such provision in the Notes shall
control.
ARTICLE II
Relation to Indenture; Definitions
-------------------------------------
Section 2.01 This Supplemental Indenture No. 1 constitutes an integral part
of the Indenture and shall be construed in connection with and as part of the
Indenture.
Section 2.02 For all purposes of this Supplemental Indenture No. 1,
capitalized terms used herein without definition shall have the meanings
specified in the Indenture. If any term is defined in this Supplemental
Indenture No. 1 and in the Indenture, such term shall have the meaning assigned
to it in this Supplemental Indenture No. 1.
ARTICLE III
Covenants
---------
Section 3.01 The provisions of Article Ten of the Indenture entitled
"Covenants" shall be applicable to the Notes.
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ARTICLE IV
Redemption
----------
Section 4.01 The provisions of Article Eleven of the Indenture entitled
"Redemption of Securities" shall be applicable to the Notes.
Section 4.02 The Notes may be redeemed at any time, in whole or in part (in
any integral multiple of $100), at the option of the Company upon not less than
30 nor more than 60 days' prior notice to the Holders thereof, at par value,
plus accrued and unpaid interest thereon to the Redemption Date (subject to the
right of holders of record on the relevant record date to receive interest due
on an Interest Payment Date).
On or after the redemption date, interest will cease to accrue on the
Notes, or portion thereof, called for redemption.
ARTICLE V
Sinking Funds
--------------
Section 5.01 The provisions of Article Twelve of the Indenture entitled
"Sinking Funds" shall not be applicable to the Notes.
ARTICLE VI
Subordination
-------------
Section 6.01 The provisions of Article Thirteen of the Indenture entitled
"Subordination of Securities" shall be applicable to the Notes.
ARTICLE VII
Conversion
----------
Section 7.01 The provisions of Article Fourteen of the Indenture entitled
"Conversion of Securities" shall be applicable to the Notes.
Section 7.02 A holder of a Note may convert the principal amount thereof
(or any portion thereof that is an integral multiple of $100) into fully paid
and nonassessable shares of Common Stock of the Company as described in Article
Fourteen of the Indenture. The initial Conversion Price for the Notes into
Common Stock is $5.00 per share, subject to certain adjustments as described in
Article Fourteen of the Indenture.
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ARTICLE VIII
Defeasance and Covenant Defeasance
-------------------------------------
Section 8.01 The provisions of Article Fifteen of the Indenture entitled
"Defeasance and Covenant Defeasance" shall not be applicable to the Notes.
ARTICLE IX
Miscellaneous
-------------
Section 9.01 The recitals of fact herein and in the Notes shall be taken as
statements of the Company and shall not be construed as made by the Trustee.
Section 9.02 THIS SUPPLEMENTAL INDENTURE NO. 1 AND THE NOTES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 9.03 In case any one or more of the provisions contained in this
Supplemental Indenture No. 1 or in the Notes should be invalid, illegal, or
unenforceable in any respect, the validity, legality and enforceability of the
remaining provisions contained herein and therein shall not in any way be
affected, impaired, prejudiced or disturbed thereby.
Section 9.04 Wherever in this Supplemental Indenture No. 1 any of the
parties hereto is named or referred to, such reference shall be deemed to
include the successors or assigns of such party, and all the covenants and
agreements in this Supplemental Indenture No. 1 contained by or on behalf of the
Company or the Trustee shall bind and inure to the benefit of the respective
successors and assigns of such parties, whether so expressed or not.
Section 9.05
(a) This Supplemental Indenture No. 1 may be simultaneously executed
in several counterparts, and all such counterparts executed and
delivered, each as an original, shall constitute but one and the
same instrument.
(b) The descriptive headings of the several Articles of this
Supplemental Indenture No. 1 were formulated, used and inserted
in this Supplemental Indenture No. 1 for convenience only and
shall not be deemed to affect the meaning or construction of any
of the provisions hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 1 to be duly executed, all as of the day and year first above
written.
WILMINGTON TRUST COMPANY
as Trustee
By: /s/ Xxxxx X. XxXxxxxx
------------------------
Name: Xxxxx X. XxXxxxxx
Title: Authorized Signer
TALK AMERICA HOLDINGS, INC.
By: /s/ Xxxxxxxx X. Lawn IV
---------------------------
Name: Xxxxxxxx X. Lawn IV
Title: Executive Vice President-
General Counsel
By: /s/ Xxxxxx X. Xxxxxxxxx, III
--------------------------------
Name: Xxxxxx X. Xxxxxxxxx, III
Title: President and Treasurer
5
STATE OF NEW YORK )
: ss:
COUNTY OF NEW YORK )
On the 4th day of April, 2002, before me personally came Xxxxx X. XxXxxxxx,
to me known, who, being by me duly sworn, did depose and say that he resides at
000 X. 00xx Xxxxxx; that he is a Trust Officer of Wilmington Trust Company, one
of the parties described in and which executed the above instrument; that he
knows the corporate seal of said corporation; that the seal affixed to the said
instrument is such corporate seal; that it was so affixed to the corporate seal
of said corporation; that the seal affixed to the said instrument is such
corporate seal; that it was so affixed by authority of the board of directors of
said corporation; and that he signed his name thereto by like authority.
[NOTARIAL SEAL]
/s/ Xxxxxxxx Xxxxxxx
Notary Public
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STATE OF PENNSYLVANIA )
: ss:
COUNTY OF BUCKS )
On the 4th day of April, 2002, before me personally came Xxxxxxxx X. Lawn
IV, to me known, who, being by me duly sworn, did depose and say that he resides
at 0000 Xxxxxxx Xxxx, Xxxx Xxxxxxx, XX 00000; that he is an Executive Vice
President-General Counsel of Talk America Holdings, Inc., one of the parties
described in and which executed the above instrument; that he knows the
corporate seal of said corporation; that the seal affixed to the said instrument
is such corporate seal; that it was so affixed to the corporate seal of said
corporation; that the seal affixed to the said instrument is such corporate
seal; that it was so affixed by authority of the board of directors of said
corporation; and that he signed his name thereto by like authority.
[NOTARIAL SEAL]
/s/ Xxx XxXxxxxx
Notary Public
7
STATE OF PENNSYLVANIA )
: ss:
COUNTY OF BUCKS )
On the 4th day of April, 2002, before me personally came Xxxxxx X.
Xxxxxxxxx, III, to me known, who, being by me duly sworn, did depose and say
that he resides at 000 Xxxxxxxxx Xxxx, Xxxxxxxxx, XX 00000; that he is
President, Treasurer of Talk America Holdings, Inc., one of the parties
described in and which executed the above instrument; that he knows the
corporate seal of said corporation; that the seal affixed to the said instrument
is such corporate seal; that it was so affixed to the corporate seal of said
corporation; that the seal affixed to the said instrument is such corporate
seal; that it was so affixed by authority of the board of directors of said
corporation; and that he signed his name thereto by like authority.
[NOTARIAL SEAL]
/s/ Xxx XxXxxxxx
Notary Public
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EXHIBIT A
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW YORK, TO
THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.
TALK AMERICA HOLDINGS, INC.
---------------------------
8% CONVERTIBLE SENIOR SUBORDINATED NOTE
---------------------------------------
DUE 2007
--------
No. $
CUSIP Xx.00000XXX0
Xxxx Xxxxxxx Holdings, Inc., a corporation duly organized and existing
under the laws of Delaware (herein called the "Company," which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to Cede & Co., or its registered assigns, the
principal sum of [ ] on August 15, 2007, and to pay interest thereon from the
Issuance Date or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on February 15 and August 15
in each year, commencing August 15, 2002, at the rate of 8% per annum, until the
principal hereof is paid or made available for payment, and (to the extent that
the payment of such interest shall be legally enforceable) on any overdue
installment of interest (including any post-petition interest in any proceeding
under any Bankruptcy Law) (without regard to any applicable grace period) at the
rate borne by the Notes, compounded annually. Interest will be computed on the
basis of a 360-day year of twelve 30-day months. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Note (or
one or more Predecessor Notes) is registered at the close of business
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on the Regular Record Date for such interest, which shall be February 1st or
August 1st preceding any Interest Payment Date, (whether or not a Business Day),
as the case may be, next preceding such Interest Payment Date. Any such interest
not so punctually paid or duly provided for will forthwith cease to be payable
to the Holder on such Regular Record Date and may either be paid to the Person
in whose name this Note (or one or more Predecessor Notes) is registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest to be fixed by the Trustee, notice whereof shall be given to Holders of
Notes of this series not less than 10 days prior to such Special Record Date, or
be paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Notes of this series may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in said Indenture.
Payment of the principal of (and premium, if any) and any such interest on
this Note will be made at the office or agency of the Company maintained for
that purpose in The City of New York, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided, however, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register or by
wire transfer to an account maintained by the Person entitled thereto as
specified in the Security Register, provided that such Person shall have given
the Trustee written wire instructions at least five Business Days prior to the
applicable Interest Payment Date.
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Note shall
not be entitled to any benefit under the Indenture or be valid or obligatory for
any purpose.
A2
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
or by facsimile by its duly authorized Officers and a facsimile of its corporate
seal to be affixed hereto or imprinted hereon.
TALK AMERICA HOLDINGS, INC.,
by: ______________________
Name:
Title:
by: ______________________
Name:
Title:
[Seal]
Attested by:
---------------------
Name:
Title: Secretary
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
This is one of the
8% Convertible Subordinated Notes
due 2007 described in the within-mentioned
Indenture.
WILMINGTON TRUST COMPANY, as Trustee,
by
Authorized Officer
Dated:
------------------
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This Note is one of a duly authorized issue of securities of the Company
(herein called the "Notes"), issued and to be issued in one or more series under
an Indenture, dated as of April 2, 2002 (herein called the "Indenture"), between
the Company and Wilmington Trust Company, as Trustee (herein called the
"Trustee," which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee, the holders of Senior Debt
and the Holders of the Notes and of the terms upon which the Notes are, and are
to be, authenticated and delivered. This Note is one of the series designated
on the face hereof, limited in aggregate principal amount to $2,822,400.
The Notes of this series are subject to redemption upon not less than 30
nor more than 60 days' notice by mail, such 30 or 60 days, as the case may be,
to be counted from the date notice is mailed, at any time, as a whole or in
part, at the election of the Company, at par value, together in the case of any
such redemption with accrued interest to the Redemption Date, but interest
installments whose Stated Maturity is on or prior to such Redemption Date will
be payable to the Holders of such Notes, or one or more Predecessor Notes, of
record at the close of business on the relevant Regular Record Dates or Special
Record Dates referred to on the face hereof, all as provided in the Indenture.
The Notes do not have the benefit of any sinking fund obligations.
The indebtedness evidenced by this Note is, to the extent provided in the
Indenture, subordinate and subject in right of payment to the prior payment in
full of all Senior Debt, and this Note is issued subject to the provisions of
the Indenture with respect thereto. Each Holder of this Note, by accepting the
same, (a) agrees to and shall be bound by such provisions, (b) authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effect the subordination so provided and (c) appoints the Trustee
his attorney-in-fact for any and all such purposes.
In the event of redemption of this Note in part only, a new Note or Notes
of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.
If an Event of Default with respect to Notes of this series shall occur and
be continuing, the principal of the Notes of this series may be declared due and
payable in the manner and with the effect provided in the Indenture.
Subject to and upon compliance with the provisions of the Indenture, the
Holder of this Note is entitled, at its option, at any time on or after the
opening of business on the Issuance Date and on or before the close of business
immediately preceding the date of the Note's maturity, or in case this Note or a
portion hereof is called for redemption, then in respect of this Note or such
portion hereof until and including, but (unless the Company defaults in making
the payment due upon redemption) not after, the close of business on the
Redemption Date, to convert this Note (or any portion of the principal amount
hereof which is $100 or an integral multiple thereof), at the principal amount
hereof, or of such portion, into fully paid and nonassessable shares (calculated
as to each conversion to the nearest 1/100 of a share) of Common Stock of the
Company at the initial Conversion Price equal to $5.00 per share, aggregate
principal amount of
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Notes for each share of Common Stock (or at the current adjusted conversion
price if an adjustment has been made as provided in the Indenture) by surrender
of this Note, duly endorsed or assigned to the Company or in blank, to the
Company at its office or agency in The City of New York, accompanied by written
notice to the Company that the Holder hereof elects to convert this Note, or if
less than the entire principal amount hereof is to be converted, the portion
hereof to be converted, and, in case such surrender shall be made during the
period from the close of business on any Regular Record Date next preceding any
Interest Payment Date to the opening of business on such Interest Payment Date
(unless this Note of the portion hereof being converted has been called for
redemption on a Redemption Date within such period), also accompanied by payment
in immediately available funds or other funds acceptable to the Company of an
amount equal to the interest payable on such Interest Payment Date on the
principal amount of this Note then being converted. Subject to the aforesaid
requirement for payment and, in the case of a conversion after the Regular
Record Date next preceding any Interest Payment Date and on or before such
Interest Payment Date, to the right of the Holder of this Note (or any
Predecessor Note) of record at such Regular Record Date to receive an
installment of interest (with certain exceptions provided in the Indenture), no
payment or adjustment is to be made on conversion for interest accrued hereon or
for dividends on the Common Stock issued on conversion. No fractions of shares
or scrip representing fractions of shares will be issued on conversion, but
instead of any fractional interest the Company shall pay a cash adjustment as
provided in the Indenture. The conversion price is subject to adjustment as
provided in the Indenture. In addition, the Indenture provides that in case of
certain consolidations or mergers to which the Company is a party or the
transfer of substantially all of the assets of the Company, the Indenture shall
be amended, without the consent of any Holders of Notes, so that this Note, if
then outstanding, will be convertible thereafter, during the period this Note
shall be convertible as specified above, only into the kind and amount of
securities, cash and other property receivable upon the consolidation, merger or
transfer by a holder of the number of shares of Common Stock into which this
Note might have been converted immediately prior to such consolidation, merger
or transfer (assuming such holder of Common Stock failed to exercise any rights
of election and received per share the kind and amount received per share by a
plurality of non-electing shares), assuming, if such consolidation, merger or
transfer is prior to the opening of business on the Issuance Date, that this
Note was convertible at the time of such consolidation, merger or transfer at
the initial conversion price specified above as adjusted from date of issuance,
to such time pursuant to the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Notes of each series to be
adversely affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of a majority in principal amount of the
Notes at the time Outstanding of each series to be adversely affected. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Notes of each series at the time
Outstanding, on behalf of the Holders of all Notes of such series, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Note shall be conclusive and binding upon such
Holder and upon all future Holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Note.
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No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Note at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Note is registrable in the Security Register, upon
surrender of this Note for registration of transfer at the office or agency of
the Company in any place where the principal of and any premium and interest on
this Note are payable, duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Notes of this series and of like tenor, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
The Notes of this series are issuable only in registered form without
coupons in denominations of $100 and integral multiples of $100. As provided in
the Indenture and subject to certain limitations therein set forth, Notes of
this series are exchangeable for a like aggregate principal amount of Notes of
this series and of like tenor of a different authorized denomination, as
requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
No recourse shall be had for the payment of the principal of (or premium,
if any) or the interest on this Note, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Indenture or any
indenture supplemental thereto, against any incorporator, stockholder, officer,
director or employee, as such, past, present or future, of the Company or any
successor corporation, whether by virtue of any constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance hereof and as part of the consideration for
the issue hereof, expressly waived and released.
Prior to due presentment of this 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 this Note is registered as the owner hereof for all
purposes (subject to Section 307 of the Indenture), whether or not this Note be
overdue, and neither the Company, the Trustee nor any such agent shall be
affected by notice to the contrary.
All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture. The Indenture and this Note
shall be governed by and construed in accordance with the laws of the State of
New York without regard to the conflicts of laws principles thereof.
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