EXHIBIT 4.5
================================================================================
INDENTURE
BETWEEN
ALLOY, INC.
AND
DEUTSCHE BANK TRUST COMPANY AMERICAS
AS TRUSTEE
5.375% CONVERTIBLE SENIOR DEBENTURES DUE 2023
DATED AS OF JULY 23, 2003
================================================================================
CROSS REFERENCE TABLE*
Trust Indenture Indenture
Act Section Section
----------- -------
310(a)(1).............................................................................. 5.11
(a)(2)............................................................................ 5.11
(a)(3)............................................................................ n/a
(a)(4)............................................................................ n/a
(a)(5)............................................................................ 5.11
(b)............................................................................... 5.3; 5.11
(c)............................................................................... n/a
311(a)................................................................................. 5.12
(b)............................................................................... 5.12
(c)............................................................................... n/a
312(a)................................................................................. 2.5
(b)............................................................................... 13.3
(c)............................................................................... 13.3
313(a)................................................................................. 5.7
(b)(1)............................................................................ n/a
(b)(2)............................................................................ 5.7
(c)............................................................................... 5.7; 13.2
(d)............................................................................... 5.7
314(a)(1), (2), (3).................................................................... 9.4; 13.2
(a)(4)............................................................................ 9.5; 13.6
(b)............................................................................... n/a
(c)(1)............................................................................ 13.5
(c)(2)............................................................................ 13.5
(c)(3)............................................................................ n/a
(d)............................................................................... n/a
(e)............................................................................... 13.6
(f)............................................................................... n/a
315(a)................................................................................. 5.1(a)
(b)............................................................................... 5.6; 13.2
(c)............................................................................... 5.1(b)
(d)............................................................................... 5.1(c)
(e)............................................................................... 4.14
316(a)(last sentence).................................................................. 2.9, 7.2
(a)(1)(A)......................................................................... 4.5
(a)(1)(B)......................................................................... 4.4
(a)(2)............................................................................ n/a
(b)............................................................................... 4.7
(c)............................................................................... 7.4
317(a)(1).............................................................................. 4.8
(a)(2)............................................................................ 4.9
(b)............................................................................... 2.6
318(a)................................................................................. 13.1
(b)............................................................................... n/a
(c)............................................................................... 13.1
---------------
"n/a" means not applicable.
*This Cross Reference Table shall not, for any purpose, be deemed to be a part
of the Indenture.
3
TABLE OF CONTENTS
PAGE
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE.........................................7
Section 1.1. Definitions..............................................................7
Section 1.2. Incorporation by Reference of Trust Indenture Act.......................16
Section 1.3. Rules of Construction...................................................17
ARTICLE 2 THE SECURITIES....................................................................17
Section 2.1. Title and Terms.........................................................17
Section 2.2. Form of Securities......................................................19
Section 2.3. Global Security Legend..................................................20
Section 2.4. Execution, Authentication, Delivery and Dating of the Securities........21
Section 2.5. Registrar and Paying Agent..............................................21
Section 2.6. Paying Agent to Hold Assets in Trust....................................22
Section 2.7. General Provisions Relating to Registration, Transfer and Exchange......23
Section 2.8. Book-Entry Provisions for the Global Securities.........................24
Section 2.9. Holder Lists............................................................25
Section 2.10. Persons Deemed Owners...................................................25
Section 2.11. Mutilated, Destroyed, Lost or Stolen Securities.........................26
Section 2.12. Treasury Securities.....................................................27
Section 2.13. Temporary Securities....................................................27
Section 2.14. Cancellation............................................................27
Section 2.15. CUSIP Numbers...........................................................28
Section 2.16. Defaulted Interest......................................................28
ARTICLE 3 DISCHARGE OF INDENTURE............................................................28
Section 3.1. Discharge of Liability on Securities....................................28
Section 3.2. Repayment to the Company................................................29
ARTICLE 4 DEFAULTS AND REMEDIES.............................................................29
Section 4.1. Events of Default.......................................................29
Section 4.2. Acceleration of Maturity; Rescission and Annulment......................31
Section 4.3. Other Remedies..........................................................32
i
TABLE OF CONTENTS
(CONTINUED)
PAGE
Section 4.4. Waiver of Past Defaults.................................................32
Section 4.5. Control by Majority.....................................................33
Section 4.6. Limitation on Suit......................................................33
Section 4.7. Unconditional Rights of Holders to Receive Payment and to Convert.......34
Section 4.8. Collection of Indebtedness and Suits for Enforcement by the Trustee.....34
Section 4.9. Trustee May File Proofs of Claim........................................35
Section 4.10. Restoration of Rights and Remedies......................................36
Section 4.11. Rights and Remedies Cumulative..........................................36
Section 4.12. Delay or Omission Not Waiver............................................36
Section 4.13. Priorities..............................................................36
Section 4.14. Undertaking for Costs...................................................37
Section 4.15. Waiver of Stay or Extension Laws........................................37
ARTICLE 5 THE TRUSTEE.......................................................................37
Section 5.1. Certain Duties and Responsibilities.....................................37
Section 5.2. Certain Rights of Trustee...............................................39
Section 5.3. Individual Rights of Trustee............................................40
Section 5.4. Money Held in Trust.....................................................40
Section 5.5. Trustee's Disclaimer....................................................40
Section 5.6. Notice of Defaults......................................................41
Section 5.7. Reports by Trustee to Holders...........................................41
Section 5.8. Compensation and Indemnification........................................41
Section 5.9. Replacement of Trustee..................................................42
Section 5.10. Successor Trustee by Merger, Etc........................................43
Section 5.11. Corporate Trustee Required; Eligibility.................................43
Section 5.12. Collection of Claims Against the Company................................43
ARTICLE 6 CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE..............................44
ii
TABLE OF CONTENTS
(CONTINUED)
PAGE
Section 6.1. Company May Consolidate, Etc., Only on Certain Terms....................44
Section 6.2. Successor Corporation Substituted.......................................44
ARTICLE 7 AMENDMENTS, SUPPLEMENTS AND WAIVERS...............................................45
Section 7.1. Without Consent of Holders of Securities................................45
Section 7.2. With Consent of Holders of Securities...................................46
Section 7.3. Compliance with Trust Indenture Act.....................................47
Section 7.4. Revocation of Consents and Effect of Consents or Votes..................47
Section 7.5. Notation on or Exchange of Securities...................................48
Section 7.6. Trustee to Sign Amendment, Etc..........................................48
ARTICLE 8 MEETING OF HOLDERS OF SECURITIES..................................................48
Section 8.1. Purposes for Which Meetings May Be Called...............................48
Section 8.2. Call Notice and Place of Meetings.......................................48
Section 8.3. Persons Entitled to Vote at Meetings....................................49
Section 8.4. Quorum; Action..........................................................49
Section 8.5. Determination of Voting Rights; Conduct and Adjournment of Meetings.....50
Section 8.6. Counting Votes and Recording Action of Meetings.........................51
ARTICLE 9 COVENANTS.........................................................................51
Section 9.1. Payment of Principal, Redemption Price, Change of Control Purchase
Price and Interest......................................................51
Section 9.2. Maintenance of Offices or Agencies......................................51
Section 9.3. Corporate Existence.....................................................52
Section 9.4. Reports.................................................................52
Section 9.5. Compliance Certificate..................................................53
ARTICLE 10 REDEMPTION OF SECURITIES..........................................................53
Section 10.1. Optional Redemption.....................................................53
Section 10.2. Notice to Trustee.......................................................54
Section 10.3. Selection of Securities to Be Redeemed..................................54
iii
TABLE OF CONTENTS
(CONTINUED)
PAGE
Section 10.4. Notice of Redemption....................................................55
Section 10.5. Effect of Notice of Redemption..........................................55
Section 10.6. Deposit and Payment of Redemption Price.................................56
Section 10.7. Securities Redeemed in Part.............................................56
ARTICLE 11 PURCHASE AT THE OPTION OF A HOLDER UPON
SPECIFIC REPURCHASE DATES OR A CHANGE OF CONTROL..................................57
Section 11.1. Purchase Right..........................................................57
Section 11.2. Repurchase Event Notice.................................................58
Section 11.3. Delivery of Repurchase Election Form; Form of Repurchase Election
Form; Withdrawal of Repurchase Election Form............................59
Section 11.4. Exercise of Purchase Rights.............................................60
Section 11.5. Deposit and Payment of the Purchase Price...............................61
Section 11.6. Effect of Delivery of Change of Control Purchase Notice and Purchase....62
Section 11.7. Physical Securities Purchased in Part...................................62
Section 11.8. Covenant to Comply With Securities Laws Upon Purchase of Securities.....62
Section 11.9. Repayment to the Company................................................62
ARTICLE 12 CONVERSION OF SECURITIES..........................................................63
Section 12.1. Conversion Right; Expiration of Conversion Right; Conversion Price......63
Section 12.2. Exercise of Conversion Right............................................65
Section 12.3. Fractions of Shares.....................................................67
Section 12.4. Adjustment of Conversion Price..........................................67
Section 12.5. Notice of Adjustments of Conversion Price...............................77
Section 12.6. Notice Prior to Certain Actions.........................................78
Section 12.7. Company to Reserve Common Stock.........................................79
Section 12.8. Common Stock to be Fully Paid and Nonassessable.........................79
Section 12.9. Taxes on Conversions....................................................79
iv
TABLE OF CONTENTS
(CONTINUED)
PAGE
Section 12.10. Cancellation of Converted Securities....................................79
Section 12.11. Effect of Reclassification, Consolidation, Merger or Sale...............80
Section 12.12. Responsibility of Trustee for Conversion Provisions.....................81
ARTICLE 13 OTHER PROVISIONS OF GENERAL APPLICATION...........................................81
Section 13.1. Trust Indenture Act Controls............................................82
Section 13.2. Notices.................................................................82
Section 13.3. Communication by Holders with Other Holders.............................83
Section 13.4. Acts of Holders of Securities...........................................83
Section 13.5. Certificate and Opinion as to Conditions Precedent......................84
Section 13.6. Statements Required in Certificate or Opinion...........................84
Section 13.7. Effect of Headings and Table of Contents................................85
Section 13.8. Successors and Assigns..................................................85
Section 13.9. Separability Clause.....................................................85
Section 13.10. Benefits of Indenture...................................................85
Section 13.11. Governing Law...........................................................85
Section 13.12. Counterparts............................................................85
Section 13.13. Legal Holidays..........................................................86
Section 13.14. Recourse Against Others.................................................86
EXHIBITS
EXHIBIT A: Form of Global Security.....................................................A-1
EXHIBIT B: Form of Certificated Security...............................................B-1
EXHIBIT D: Form of Transfer Certificate................................................C-1
EXHIBIT D: Form of Conversion Notice...................................................D-1
EXHIBIT E: Form of Repurchase Election Form............................................E-1
v
INDENTURE, dated as of July 23, 2003 (this "INDENTURE"),
between ALLOY, INC., a corporation duly organized and existing under the laws of
the State of Delaware, having its principal office at 000 Xxxx 00xx Xxxxxx, 00xx
Xxxxx, Xxx Xxxx, XX 00000 (the "COMPANY") and DEUTSCHE BANK TRUST COMPANY
AMERICAS, a New York banking corporation, as Trustee (the "TRUSTEE"), having its
principal corporate trust office at Deutsche Bank Trust Company Americas,
Corporate Trust & Agency Services, 00 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX
00000.
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of
its 5.375% Convertible Senior Debentures due 2023 (the "SECURITIES") having the
terms, tenor, amount and other provisions hereinafter set forth, and, to provide
therefor, the Company has duly authorized the execution and delivery of this
Indenture.
All things necessary to make the Securities, when the
Securities are duly executed by the Company and authenticated and delivered
hereunder and duly issued by the Company, the valid obligations of the Company,
and to make this Indenture a valid and binding agreement of the Company, in
accordance with their and its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders (as defined below) thereof, it is mutually
covenanted and agreed, for the equal and proportionate benefit of all Holders of
the Securities, as follows:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 DEFINITIONS.
For all purposes of this Indenture and the Securities, the
following terms are defined as follows:
"144A GLOBAL SECURITY" means a permanent Global Security in
the form of the Security attached hereto as Exhibit A, and that is deposited
with the Trustee as custodian for, and registered in the name of the Depositary
or its nominee, representing Securities sold in reliance on Rule 144A under the
Securities Act.
"ACT", when used with respect to any Holder of a Security, has
the meaning specified in Section 13.4(a).
"AFFILIATE" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this definition,
"control", when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"APPLICABLE PROCEDURES" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Security, in each case to the
extent applicable to such transaction and as in effect from time to time.
"AGENT MEMBER" has the meaning specified in Section
2.12(e)(5).
"BANKRUPTCY LAW" means Title 11 of the U.S. Code or any
similar federal or state law for the relief of
debtors.
"BOARD OF DIRECTORS" means either the board of directors of
the Company or any committee of that board empowered to act for it with respect
to this Indenture.
"BOARD RESOLUTION" means a resolution duly adopted by the
Board of Directors, a copy of which, certified by the Secretary or an Assistant
Secretary of the Company to be in full force and effect on the date of such
certification, shall have been delivered to the Trustee.
"BUSINESS DAY" when used with respect to any Place of Payment
or Place of Conversion, means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in that Place of Payment
or Place of Conversion, as applicable, are authorized or obligated by law to
close.
"CAPITAL STOCK" means, with respect to any Person, any and all
shares, interests, rights to purchase, warrants, options, participations or
other equivalents of or interests (however designated) in equity of such Person,
whether now outstanding or issued after the date of this Indenture, including,
without limitation, all common stock and preferred stock.
"CERTIFICATED SECURITIES" means Securities that are in the
form of the Securities attached hereto as Exhibit B.
"CHANGE OF CONTROL" means the occurrence of any of the
following after the original issuance of the Securities when any of the
following has occurred:
(i) the acquisition by any "person" or "group" (within the
meaning of Sections 13(d) and 14(d)(2), respectively, of the Exchange
Act) deemed to be a "beneficial owner" (as defined in Rule 13d-3 of the
Exchange Act), directly or indirectly, through a purchase, merger or
other acquisition transaction or series of purchase, merger or other
acquisition transactions of shares of the Company's Capital Stock
entitling such person to exercise 50% or more of the total voting power
of all shares of the Company's Capital Stock entitled to vote generally
7
in elections of directors, other than any acquisition by the Company,
any of its Subsidiaries or any of its employee benefit plans (except
that such person shall be deemed to have beneficial ownership of all
securities that such person has the right to acquire, whether such
right is currently exercisable or is exercisable only upon the
occurrence of a subsequent condition);
(ii) the first day on which a majority of the members of the
Board of Directors (which for purposes of this provision shall mean
only the Board of Directors, and not any committee thereof) are not
continuing directors;
(iii) any consolidation or merger of the Company with or into
any other person (which for purposes of this definition has the meaning
set forth in Section 13(d)(3) of the Exchange Act), any merger of
another person into the Company, or any conveyance, transfer, sale,
lease or other disposition of all or substantially all of the
properties and assets of the Company to another person, other than in
each case (x) any transaction (i) that does not result in any
reclassification, conversion, exchange or cancellation of outstanding
shares of Capital Stock of the Company and (ii) pursuant to which
holders of Capital Stock of the Company immediately prior to such
transaction have the entitlement to exercise, directly or indirectly,
50% or more of the total voting power of all shares of Capital Stock of
the Company entitled to vote generally in the election of directors of
the continuing or surviving person immediately after such transaction
or (y) any such merger solely for the purpose of changing the
jurisdiction of incorporation of the Company and resulting in a
reclassification, conversion or exchange of outstanding Common Stock
solely into shares of the common stock of the surviving entity;
provided, however, that a Change of Control shall not be deemed to have occurred
if the (A) Market Price per share of the Common Stock for any five Trading Days
within the period of 10 consecutive Trading Days ending immediately after the
later of the Change of Control or the public announcement of the Change of
Control, in the case of a Change of Control under clause (i) above, or the
period of 10 consecutive Trading Days ending immediately before the Change of
Control, in the case of a Change of Control under clause (ii) or (iii) above,
shall equal or exceed 110% of the Conversion Price of the Securities in effect
on each such Trading Day; or (B) at least 90% of the consideration in the
transaction or transactions constituting a Change of Control consists of shares
of common stock traded or to be traded immediately following such Change of
Control on a national securities exchange or the Nasdaq National Market and, as
a result of the transaction or transactions, the Securities become convertible
solely into such common stock (and any rights attached thereto).
"CHANGE OF CONTROL PURCHASE DATE" has the meaning specified
in Section 11.1(b) hereof.
8
"COMMISSION" means the Securities and Exchange Commission or
any successor agency.
"COMMON STOCK" means any stock of any class of the Company
which has no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which is not subject to redemption by the Company. However,
subject to the provisions of Section 12.11 hereof, shares issuable on conversion
of the Securities shall include only shares of the class designated as common
stock, par value $.01 per share, of the Company at the date of execution of this
Indenture or shares of any class or classes resulting from any reclassification
or reclassifications thereof and which have no preference in respect of
dividends or of amounts payable in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Company and which are not subject
to redemption by the Company, provided that if at any time there shall be more
than one such resulting class, the shares of each such class then so issuable
shall be substantially in the proportion which the total number of shares of
such class resulting from all such reclassifications bears to the total number
of shares of all such classes resulting from all such reclassifications.
"COMPANY" means the corporation named as the "Company" in the
first paragraph of this instrument until a successor Person shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"COMPANY ORDER" means a written order signed in the name of
the Company by any Officer.
"CONTINUING DIRECTOR" means, as of any date of determination,
any member of the Board of Directors who: (i) was a member of the Board of
Directors on the date of this Indenture or (ii) was nominated for election or
elected to the Board of Directors with a majority of the continuing directors
who were members of the Board at the time of the new director's nomination or
election.
"CONVERSION AGENT" means any Person authorized by the Company
to convert Securities in accordance with Article 12. Initially, the Conversion
Agent shall be Deutsche Bank Trust Company Americas.
"CONVERSION DATE" means, with respect to any Holder, the date
on which such Holder has satisfied all the requirements to convert its
Securities pursuant to Section 12.2.
"CONVERSION PERIOD" has the meaning specified Section 12.1(b).
"CONVERSION PRICE" has the meaning specified in Section
12.1(c).
"CONVERSION RATE" has the meaning specified in Section
12.1(b).
9
"CONVERSION RECORD DATE" has the meaning specified in Section
12.4(g).
"CONVERSION VALUE" has the meaning specified in Section
12.1(b).
"CORPORATE TRUST OFFICE" means for purposes of presentation or
surrender of Securities for payment, registration, transfer, exchange or
conversion or for service of notices or demands upon the Company or for any
other purpose of this Indenture, the office of the Trustee located in the
Borough of Manhattan, The City of New York at which at any particular time its
corporate trust business shall be administered, which at the date of this
Indenture is located at Deutsche Bank Trust Company Americas, Corporate Trust &
Agency Services, 00 Xxxx Xxxxxx, 00xx Xxxxx - Mail Stop NYC60-2710, Xxx Xxxx, XX
00000.
"CORPORATION" means any corporation, association, limited
liability company, company and business trust.
"CURRENT MARKET PRICE" has the meaning set forth in Section
12.4(g).
"DEFAULT" means an event which is, or after notice or lapse of
time or both would be, an Event of Default.
"DEFAULTED PAYMENT" has the meaning specified in Section
4.1(a).
"DEPOSITARY" has the meaning set forth in Section 2.1(a).
"DOLLAR" or "$" means a U.S. 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.
"DTC" has the meaning set forth in Section 2.1(a).
"EVENT OF DEFAULT" has the meaning specified in Section 4.1.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
"EX-DIVIDEND TIME" has the meaning specified in Section
12.1(b).
"EXPIRATION TIME" has the meaning specified in Section
12.4(f).
"FAIR MARKET VALUE" has the meaning set forth in Section
12.4(g).
"FISCAL QUARTER" means the fiscal quarterly period of the
Company ending on April 30, July 31, October 31 or January 31 of each year.
"GAAP" has the meaning set forth in Section 1.3.
10
"GLOBAL SECURITIES" means Securities that are in the form of
the Securities attached hereto as Exhibit A, and that are registered in the
Register in the name of a Depositary or a nominee thereof, and to the extent
such Securities are required to bear the Legend required by Section 2.6, such
Securities will be in the form of a 144A Global Security.
"GUARANTEE" means any obligation, contingent or otherwise, of
any Person directly or indirectly guaranteeing any indebtedness or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to purchase or pay (or advance or supply funds for the purchase or
payment of) such indebtedness or other obligation of such other Person (whether
arising by virtue of partnership arrangements, or by agreements to keep-well, to
purchase assets, goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for purposes
of assuring in any other manner the obligee of such indebtedness or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided that the term "guarantee" shall
not include endorsements for collection or deposit in the ordinary course of
business. The term "guarantee" used as a verb has a corresponding meaning.
"HOLDER", when used with respect to any Security, including
any Global Security, means the Person in whose name the Security is registered
in the Register.
"INDENTURE" means this instrument as originally executed or
as it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.
"INITIAL PURCHASERS" mean Xxxxxx Brothers Inc., CIBC World
Markets Corp., XX Xxxxxx Securities, Inc. and XX Xxxxx Securities Corporation,
as initial purchasers, under the Purchase Agreement.
"INTEREST" means, with respect to any Security, the interest
payable on such Security based upon the Interest Rate.
"INTEREST PAYMENT DATE" means each of February 1 and August 1,
provided, however, that if any such date is not a Business Day, the Interest
Payment Date shall be the next succeeding Business Day.
"INTEREST RATE" means 5.375% per annum.
"ISSUE DATE" of any Security means the date on which the
Security was originally issued or deemed as set forth on the face of the
Security.
"MARKET PRICE" of a security on any date of determination
means:
11
(1) the closing sale price (or, if no closing sale price is
reported, the last reported sale price) of such security (regular way) 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 listed;
(3) if such security is not so listed on a the New York Stock
Exchange or a U.S. national or regional securities exchange, the closing sales
price as reported by the Nasdaq National Market;
(4) if such security is not so listed on the New York Stock
Exchange, a U.S. national or regional stock exchange or reported on the Nasdaq
National Market, the last price quoted by Interactive Data Corporation for such
security on such date or, if Interactive Data Corporation is not quoting such
price, a similar quotation service selected by the Company;
(5) if such security is not so listed on the New York Stock
Exchange, a U.S. national or regional stock exchange or reported on the Nasdaq
National Market or quoted by Interactive Data Corporation or a similar quotation
device, the average of the mid-point of the last bid and ask prices for such
security on such date from at least two dealers recognized as market-makers for
such security selected by the Company for this purpose; or
(6) if none of the foregoing apply to such security, the
average of the last bid and ask prices for such security on such date from a
dealer engaged in the trading of convertible securities selected by the Company
for this purpose.
"MATURITY" means the date on which the Principal with respect
to any Security becomes due and payable as therein or herein provided, whether
at the Stated Maturity or by acceleration, conversion, call for redemption,
exercise of a purchase right or otherwise.
"NASDAQ NATIONAL MARKET" means the National Association of
Securities Dealers Automated Quotation National Market or any successor national
securities exchange or automated over-the-counter trading market in the United
States.
"NON-ELECTING SHARE" has the meaning specified in Section
12.11.
"OFFICER" of the Company means the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Financial Officer, the
Treasurer, any Assistant Treasurer, any Vice President, the Secretary or any
Assistant Secretary of the Company.
"OFFICERS' CERTIFICATE" means, with respect to the Company, a
certificate signed by both (1) the Chairman of the Board, the Chief Executive
Officer, the President or a Vice President and (2) so long as not the same as
12
the officer signing pursuant to clause (1), the Chief Financial Officer, the
Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of
the Company and delivered to the Trustee.
"OPINION OF COUNSEL" means a written opinion of counsel, who
may be counsel to the Company (and may include directors or employees of the
Company) and in form and substance acceptable to the Trustee, which acceptance
shall not be unreasonably withheld.
"OUTSTANDING", when used with respect to Securities, means,
as of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except Securities:
(i) previously canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) for the payment or redemption of which money in the
necessary amount has been previously deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities; provided, however,
that if such Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture; and
(iii) which have been paid in exchange for or in lieu of other
Securities which have been authenticated and delivered pursuant to this
Indenture, other than any such Securities in respect of which there
shall have been presented to the Trustee proof satisfactory to it that
such Securities are held by a protected purchaser in whose hands such
Securities are valid obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities are present at a meeting of Holders
of Securities for quorum purposes or have consented to or voted in favor of any
request, demand, authorization, direction, notice, consent, waiver, amendment or
modification hereunder, Securities held for the account of the Company or of any
of its Affiliates shall be disregarded and deemed not to be Outstanding, except
that in determining whether the Trustee shall be protected in making such a
determination or relying upon any such quorum, consent or vote, only Securities
which a Responsible Officer of the Trustee actually knows to be so owned shall
be so disregarded.
"PAYING AGENT" has the meaning specified in Section 2.3.
"PERSON" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
estate, unincorporated organization or government or any agency or political
subdivision thereof.
13
"PLACE OF CONVERSION" means any city in which any Conversion
Agent is located.
"PLACE OF PAYMENT" means any city in which any Paying Agent is
located.
"PRINCIPAL" means, with respect to any Security, the
principal amount of that Security, including the Redemption Price, if
applicable, and the Repurchase Price, if applicable, payable with respect to
that Security.
"PURCHASE AGREEMENT" means the Purchase Agreement, dated July
17, 2003, among the Company and the Initial Purchasers relating to the offering
and initial sale of the Securities.
"PURCHASE RIGHT" has the meaning provided in Section 11.1(a).
"PURCHASED SHARES" has the meaning assigned to it in Section
12.4(f).
"QIBS" has the meaning set forth in Section 2.1(a).
"REDEMPTION DATE", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"REDEMPTION PRICE", when used with respect to any Security to
be redeemed, means the price per Security at which such Security may be redeemed
pursuant to Section 10.1.
"REFERENCE DEALER" means a dealer engaged in the trading of
convertible securities selected by the Company for the purpose for which such
dealers are quoted or otherwise to which they are referred herein.
"REFERENCE PERIOD" has the meaning set forth in Section
12.4(d).
"REGISTER" has the meaning specified in Section 2.3.
"REGISTRAR" has the meaning specified in Section 2.3.
"REGISTRATION RIGHTS AGREEMENT" means the Resale Registration
Rights Agreement, dated as of the date hereof between the Company and the
Initial Purchasers.
"REGULAR RECORD DATE" for the Interest payable on the
Securities means the January 15 and the July 15 (whether or not a Business Day),
as applicable, next preceding the corresponding Interest Payment Date.
"REPURCHASE DATE" has the meaning specified in Section
11.1(b) hereof.
"REPURCHASE ELECTION FORM" has the meaning specified in
Section 11.2 hereof.
14
"REPURCHASE EVENT NOTICE" has the meaning specified in Section
11.2.
"REPURCHASE EVENTS" has the meaning specified in Section
11.1(b).
"REPURCHASE PRICE" has the meaning specified in Section
11.1(a) hereof.
"RESPONSIBLE OFFICER", when used with respect to the Trustee,
means any officer of the Trustee, including any vice president, assistant vice
president, any treasurer, any assistant treasurer, any trust officer, or any
other officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"RESTRICTED SECURITY" means a Security required to bear the
restrictive legend set forth in the form of Security set forth in Exhibits A and
B of this Indenture.
"SEC" means the Securities and Exchange Commission.
"SECURITIES" has the meaning ascribed to it in the first
paragraph under the caption "Recitals of the Company".
"SECURITIES ACT" means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission thereunder.
"SIGNIFICANT SUBSIDIARY" has the meaning assigned to it under
Rule 405 of the Securities Act.
"SPECIFIC REPURCHASE DATE" has the meaning assigned to in
Section 11.1(a).
"SPIN-OFF" has the meaning set forth in Section 12.4(d).
"STATED MATURITY" has the meaning assigned to it in Section
2.1(b).
"SUBSIDIARY" means a corporation more than 50% of the
outstanding Voting Stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries.
"TIA" means the Trust Indenture Act of 1939, as amended (15
U.S. Code Section 77aaa 77bbbb), 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 such amendment, the Trust Indenture Act of
1939, as so amended, or any successor statute.
"TRADING DAY" means:
15
(1) if the applicable security is listed or admitted for
trading on the New York Stock Exchange, a day on which the New York
Stock Exchange is open for business;
(2) if that security is not listed on the New York Stock
Exchange, a day on which trades may be made on the Nasdaq National
Market;
(3) if that security is not so listed on the New York Stock
Exchange and not quoted on the Nasdaq National Market, a day on which
the principal U.S. securities exchange on which the securities are
listed is open for business; or
(4) if the applicable security is not so listed, admitted for
trading or quoted, any day other than a Saturday or a Sunday or a day
on which banking institutions in the State of New York are authorized
or obligated by law or executive order to close.
"TRIGGER EVENT" has the meaning specified in Section 12.4(d).
"TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"VICE PRESIDENT", when used with respect to the Company,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "vice president".
"VOTING STOCK" means with respect to any Person, Capital Stock
of any class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
SECTION 1.2 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the
following meanings:
"INDENTURE SECURITIES" means the Securities;
"INDENTURE SECURITY HOLDER" means a Holder;
"INDENTURE TO BE QUALIFIED" means this Indenture;
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the
Trustee; and
16
"OBLIGOR" on the Securities means the Company and any other
obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by Commission
rule have the meanings assigned to them by such definitions.
SECTION 1.3 RULES OF CONSTRUCTION.
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 generally
accepted accounting principles in the United States prevailing at the
time of any relevant computation hereunder ("GAAP");
(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;
(4) all references to section and article numbers in
this Indenture shall refer to sections and articles hereof, unless
otherwise specified.
ARTICLE 2
THE SECURITIES
SECTION 2.1 FORM AND DATING.
The Securities and the Trustee's certificate of authentication
shall be substantially in the form of Exhibits A and B, which are a part of this
Indenture. The Securities may have notations, legends or endorsements required
by law, stock exchange rule or usage (provided that any such notation, legend or
endorsement required by usage is in a form acceptable to the Company). The
Company shall provide any such notations, legends or endorsements to the Trustee
in writing. Each Security shall be dated the date of its authentication. The
Securities shall mature on August 1, 2023 (the "STATED MATURITY"), and shall
bear Interest from the Issue Date until the principal amount thereof is paid or
made available for payment, or until such date on which the Securities are
converted, redeemed or purchased as provided herein at the Interest Rate.
Interest shall be payable semiannually in arrears on each Interest Payment Date.
(a) 144A Global Securities. Securities offered and sold within
the United States to qualified institutional buyers as defined in Rule 144A
("QIBs") in reliance on Rule 144A shall be issued initially in the form of a
17
144A Global Security, which shall be deposited with the Trustee at its Corporate
Trust Office, as custodian for the Depositary (as defined below) and registered
in the name of The Depository Trust Company ("DTC") or the nominee thereof (DTC,
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
Securities may from time to time be increased or decreased by adjustments made
on the records of the Trustee and the Depositary as hereinafter provided.
(b) Global Securities in General. Each Global Security shall
represent such of the outstanding Securities as shall be specified therein and
each shall provide that it shall represent the aggregate amount of outstanding
Securities from time to time endorsed thereon and that the aggregate amount of
outstanding Securities represented thereby may from time to time be reduced or
increased, as appropriate, to reflect exchanges, redemptions, repurchases and
conversions.
Any adjustment of the aggregate principal amount of a Global
Security to reflect the amount of any increase or decrease in the amount of
outstanding Securities represented thereby shall be made by the Trustee in
accordance with instructions given by the Holder thereof as required by Section
2.12 hereof and shall be made on the records of the Trustee and the Depositary.
(c) Book-Entry Provisions. This Section 2.1(c) shall apply
only to Global Securities deposited with or on behalf of the Depositary. The
Company shall execute and the Trustee shall, in accordance with this Section
2.1(c), authenticate and deliver initially one or more Global Securities that
(a) shall be registered in the name of the Depositary, (b) shall be delivered by
the Trustee to the Depositary or pursuant to the Depositary's instructions and
(c) shall be substantially in the form of Exhibit A attached hereto; provided
that the Legend (other than the first and second paragraphs thereof) may be
removed from such Global Security on satisfaction of the conditions for removal
thereof specified in this Indenture.
(d) Certificated Securities. Securities not issued as
interests in the Global Securities will be issued in certificated form
substantially in the form of Exhibit B attached hereto; provided that the Legend
may be removed from such Securities on satisfaction of the conditions for
removal thereof specified in this Indenture.
SECTION 2.2 EXECUTION AND AUTHENTICATION.
The Securities shall be executed on behalf of the Company by
any Officer. The signature of the Officer on the Securities may be manual or
facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at the time of the execution of the Securities, Officers
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
18
such Securities or did not hold such offices at the date of authentication of
such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities executed by the
Company to the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with such Company Order shall authenticate and deliver such Securities as in
this Indenture provided and not otherwise. No Security shall be entitled to any
benefit under this Indenture or be valid or obligatory for any purpose unless
there appears on such Security a certificate of authentication substantially in
the form provided for herein duly executed by the Trustee by manual signature of
an authorized signatory, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder.
The Trustee shall authenticate and deliver the Securities for
original issue in an aggregate principal amount of $65.0 million (or a maximum
of $78.0 million if the Initial Purchasers' over-allotment option set forth in
the Purchase Agreement is exercised in full) upon one or more Company Orders
without any further action by the Company. The aggregate principal amount of the
Securities due at the Stated Maturity thereof outstanding at any time may not
exceed the amounts set forth in the foregoing sentence.
The Securities shall be issued only in registered form without
coupons and only in denominations of $1,000 of principal amount and any integral
multiple of $1,000.
SECTION 2.3 REGISTRAR, PAYING AGENT AND CONVERSION AGENT.
The Company shall maintain an office or agency where
Securities may be presented for registration of transfer or for exchange
("REGISTRAR"), an office or agency where Securities may be presented for
purchase or payment ("PAYING AGENT") and an office or agency where Securities
may be presented for conversion ("CONVERSION AGENT"). The Registrar shall keep a
register of the Securities and of their transfer and exchange. The Company may
have one or more co-registrars, one or more additional paying agents and one or
more additional conversion agents. The term Paying Agent includes any additional
paying agent. The term Conversion Agent includes any additional conversion
agent. The Company may change any Paying Agent, Registrar or Conversion Agent
without prior notice to any Holder.
The Company shall enter into an appropriate agency agreement
with any Registrar, Paying Agent, Conversion Agent or co-registrar (in each
case, if such Registrar, agent or co-registrar is a Person 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 5.8. The Company or any
19
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,
Paying Agent and Conversion Agent in connection with the Securities.
SECTION 2.4 PAYING AGENT TO HOLD MONEY AND SECURITIES IN
TRUST.
Except as otherwise provided herein, on or prior to each due
date of payments in respect of any Security, the Company shall deposit with the
Paying Agent a sum of money (in immediately available funds if deposited on the
due date) 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 the Holders or the
Trustee all money held by the Paying Agent for the making of payments in respect
of the Securities and shall notify the Trustee of any default by the Company in
making any such payment. At any time during the continuance of any such default,
the Paying Agent shall, upon the written request of the Trustee, forthwith pay
to the Trustee all money so held in trust. If the Company, a Subsidiary or an
Affiliate of either of them acts as Paying Agent, such Person shall segregate
the money 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 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.
SECTION 2.5 HOLDER 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 all Holders. If the Trustee is not the Registrar, the Company shall
cause to be furnished to the Trustee at least semiannually on January 1 and July
1 a listing of all Holders 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 Holders.
SECTION 2.6 TRANSFER AND EXCHANGE.
(a) Subject to Section 2.12 hereof, upon surrender for
registration of transfer of any Security, together with a written instrument of
transfer satisfactory to the Registrar duly executed by the Holder or such
Holder's attorney duly authorized in writing, at the office or agency of the
Company designated as Registrar or co-registrar pursuant to Section 2.3, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
any authorized 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
20
connection with the transfer or exchange of the Securities from the Holder
requesting such transfer or exchange.
At the option of the Holder, Securities may be exchanged for
other Securities of any authorized denomination or denominations, of a like
aggregate principal amount upon surrender of the Securities to be exchanged,
together with a written instrument of transfer satisfactory to the Registrar
duly executed by the Holder or such Holder's attorney duly authorized in
writing, at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.
The Company shall not be required to make, and the Registrar
need not register, transfers or exchanges of Securities selected for redemption
(except, in the case of Securities to be redeemed in part, the portion thereof
not to be redeemed) or any Securities in respect of which a Repurchase Election
Form has been given and not withdrawn by the Holder thereof in accordance with
the terms of this Indenture (except, in the case of Securities to be purchased
in part, the portion thereof not to be purchased) or any Securities for a period
of 15 days before the mailing of a notice of redemption of Securities to be
redeemed.
Notwithstanding any provision to the contrary herein, so long
as a Global Security remains outstanding and is held by or on behalf of the
Depositary, (i) transfers of beneficial interests in a Global Security, in whole
or in part, may be effected only through a book entry system maintained by the
Holder of such Global Security (or its agent) in accordance with Applicable
Procedures, (ii) ownership of a beneficial interest in the Security shall be
required to be reflected solely in book entry and (iii) transfers of Global
Securities or beneficial interests in Global Securities shall be made only in
accordance with Section 2.12 and this Section 2.6(b). Transfers of a Global
Security shall be limited to transfers of such Global Security in whole or in
part, to the Depositary, to nominees of the Depositary or to a successor of the
Depositary or such successor's nominee.
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.
Any Registrar appointed pursuant to Section 2.3 hereof shall
provide to the Trustee such information as the Trustee may reasonably require in
connection with the delivery by such Registrar of Securities upon transfer or
exchange of Securities.
No Registrar shall be required to make registrations of
transfer or exchange of Securities during any periods designated in the text of
the Securities or in this Indenture as periods during which such registration of
transfers and exchanges need not be made.
21
If Securities are issued upon the transfer, exchange or
replacement of Securities subject to restrictions on transfer and bearing the
legends set forth on the forms of Security attached hereto as Exhibits A and B
setting forth such restrictions (collectively, the "LEGEND"), or if a request is
made to remove the Legend on a Security, the Securities so issued shall bear the
Legend, or the Legend shall not be removed, as the case may be, unless there is
delivered to the Company and the Registrar such satisfactory evidence, which
shall include an opinion of counsel 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, as may be
reasonably required by the Company and the Registrar and the Trustee (if not the
same Person as the Trustee), 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 of 1933,
as amended ("Securities Act") or that such Securities are not "restricted"
within the meaning of Rule 144 under the Securities Act. Upon (i) provision of
such satisfactory evidence, or (ii) notification by the Company to the Trustee
and Registrar of the sale of such Security pursuant to a registration statement
that is effective at the time of such sale, the Trustee, at the written
direction of the Company, shall authenticate and deliver a Security that does
not bear the Legend. If the Legend is removed from the face of a Security and
the Security is subsequently held by the Company or an Affiliate of the Company,
the Legend shall be reinstated.
If Rule 144(k) as promulgated under the Securities Act is
amended to shorten the two-year holding period under Rule 144(k), then, the
references in the Legend to "TWO YEARS", and in the corresponding transfer
restrictions described above, will be deemed to refer to such shorter period,
from and after receipt by the Trustee of an Officers' Certificate and an Opinion
of Counsel to that effect. As soon as practicable after the Company knows of the
effectiveness of any such amendment to shorten the two-year holding period under
Rule 144(k), unless such changes would otherwise be prohibited by, or would
cause a violation of, the federal securities laws applicable at the time, the
Company will provide to the Trustee an Officers' Certificate and an Opinion of
Counsel as to the effectiveness of such amendment and the effectiveness of such
change to the restrictive legends and transfer restrictions.
Until the Legend on any Restricted Security has been removed
in compliance with this Section 2.6, all shares of Common Stock (or other
securities issuable upon conversion as a result of the provisions of this
Indenture) issued upon conversion of such Restricted Security shall bear a
legend substantially in the form of the Legend (the "COMMON STOCK RESTRICTIVE
LEGEND") and shall be subject to the same restrictions on transfer as such
Restricted Security. At any time following the time when the restrictions on
transfer set forth in the Common Stock Restrictive Legend shall have expired in
accordance with their terms or shall have terminated under applicable law, the
holder of such Common Stock may, upon a surrender of the certificate
representing such Common Stock exchange to the Company's transfer agent in
accordance with such agent's customary procedures (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
22
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 Common Stock
has been made in compliance with Rule 144 or such successor provision), may
receive a new certificate representing such Common Stock, in like amount, which
shall not bear the Common Stock Restrictive Legend.
SECTION 2.7 REPLACEMENT SECURITIES.
If (a) any mutilated Security is surrendered to the Trustee,
or (b) the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company and the Trustee such security or indemnity as may be required by them to
save each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute and upon its written request the Trustee shall
authenticate and deliver, in exchange for any such mutilated Security or in lieu
of any such destroyed, lost or stolen Security, a new Security of like tenor and
principal amount, bearing a certificate number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, or is about to be purchased by
the Company pursuant to Article 10 or Article 11 hereof, the Company in its
discretion may, instead of issuing a new Security, pay or purchase such
Security, as the case may be.
Upon the issuance, authentication and delivery of any new
Securities under this Section 2.7, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee) connected therewith.
Every new Security issued, authenticated and delivered
pursuant to this Section 2.7 in lieu of any mutilated, destroyed, lost or stolen
Security shall constitute an original additional contractual obligation of the
Company, whether or not the destroyed, lost or stolen Security shall be at any
time enforceable by anyone, and shall be entitled to all benefits of this
Indenture equally and proportionately with any and all other Securities duly
issued hereunder.
The provisions of this Section 2.7 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 2.8 OUTSTANDING SECURITIES; DETERMINATIONS OF HOLDERS'
ACTION.
Securities outstanding at any time are all the Securities
authenticated by the Trustee except for (i) those cancelled by it, (ii) those
paid pursuant to Section 2.7, (iii) those delivered to it for cancellation and
(iv) those described in this Section 2.8 as not outstanding. A Security does not
23
cease to be outstanding because the Company or an Affiliate thereof holds the
Security; provided, however, that in determining whether the Holders of the
requisite principal amount of Securities have given or concurred in any request,
demand, authorization, direction, notice, consent, waiver, or other Act
hereunder, Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company or such other obligor shall be
disregarded and deemed not to be outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent, waiver or other Act, only Securities
which a Responsible Officer of the Trustee actually knows to be so owned shall
be so disregarded. Subject to the foregoing, only Securities outstanding at the
time of such determination shall be considered in any such determination
(including, without limitation, determinations pursuant to Articles 4 and 7).
If a Security is replaced pursuant to Section 2.7, it ceases
to be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture,
on a Redemption Date, or on the Business Day following a Repurchase Date, or on
Stated Maturity, money sufficient to pay Securities payable on that date, then
immediately after such Redemption Date, Repurchase Date or Stated Maturity, as
the case may be, such Securities shall cease to be outstanding and interest on
such Securities shall cease to accrue; provided, that if such Securities are to
be redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made.
If a Security is converted in accordance with Article 12, then
from and after the time of conversion on the date of conversion, such Security
shall cease to be outstanding and interest shall cease to accrue on such
Security.
SECTION 2.9 TEMPORARY SECURITIES.
Pending the preparation of definitive Securities, the Company
may execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as conclusively evidenced
by their execution of such Securities.
If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay. After the
preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for such purpose
pursuant to Section 2.3, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities, the Company shall execute
24
and the Trustee shall authenticate and deliver in exchange therefor a like
principal amount of definitive Securities of authorized denominations. Until so
exchanged the temporary Securities shall in all respects be entitled to the same
benefits under this Indenture as definitive Securities.
SECTION 2.10 CANCELLATION.
If the Company shall acquire any of the Securities, such
acquisition shall not operate as a redemption or satisfaction of the
indebtedness represented by such Securities unless the same are delivered to the
Trustee for cancellation. All Securities surrendered for payment, purchase by
the Company pursuant to conversion, redemption or registration of transfer or
exchange shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee and shall be promptly cancelled by it. The Company may
at any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Securities so delivered shall be promptly cancelled
by the Trustee. The Company may not issue new Securities to replace Securities
it has paid or delivered to the Trustee for cancellation or that any Holder has
converted pursuant to Article 12. No Securities shall be authenticated in lieu
of or in exchange for any Securities cancelled as provided in this Section,
except as otherwise expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of by the Trustee in accordance
with the Trustee's customary procedure.
SECTION 2.11 PERSONS DEEMED OWNERS.
Prior to due presentment of a Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name such Security is registered as the owner of
such Security for the purpose of receiving payment of principal of the Security
or the payment of any Redemption Price or Repurchase Price in respect thereof,
and interest thereon, for the purpose of conversion and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by
notice to the contrary.
SECTION 2.12 GLOBAL SECURITIES.
(a) Notwithstanding any other provisions of this Indenture or
the Securities, (A) transfers of a Global Security, in whole or in part, shall
be made only in accordance with Section 2.6 and Section 2.12(a)(i), (B)
transfers or exchanges of a beneficial interest in a Global Security for an
interest in the same or another Global Security shall comply with Section 2.6
and Section 2.12(a)(iii) below, (C) transfers of a beneficial interest in a
Global Security for a Certificated Security shall comply with Section 2.6,
Section 2.12(a)(ii) below and Section 2.12(e)(1) below, and (D) transfers of a
Certificated Security shall comply with Section 2.6 and Sections 2.12(a)(iv) and
(v) below.
25
(i) Transfer of Global Security. A Global Security
may not be transferred, in whole or in part, to any Person
other than the Depositary or a nominee or any successor
thereof, and no such transfer to any such other Person may be
registered; provided that this clause (i) shall not prohibit
any transfer of a Certificated Security that is issued in
exchange for a Global Security. No transfer of a Global
Security to any Person shall be effective under this Indenture
or the Securities unless and until such Security has been
registered in the name of such Person. Nothing in this Section
2.12(a)(i) shall prohibit or render ineffective any transfer
of a beneficial interest in a Global Security effected in
accordance with the other provisions of this Section 2.12.
(ii) Transfer or Exchange of a Beneficial Interest in
a Global Security for a Beneficial Interest in the Same or
Another Global Security.
(x) A beneficial interest in a Global Security may
not be transferred or exchanged for a beneficial interest
in another Global Security except upon satisfaction of
the requirements set forth below. Upon receipt by the
Trustee of a request to transfer or exchange of a
beneficial interest in a Global Security in accordance
with Applicable Procedures for a beneficial interest in
another Global Security,together with:
(A) so long as the Securities are Restricted
Securities, certification in the form set forth in
Exhibit C;
(B) written instructions to the Trustee to make, or
direct the Registrar to make, in the case of a
transfer or exchange of a beneficial interest in a
Global Security for a beneficial interest in another
Global Security, an adjustment on its books and
records with respect to such Global Securities to
reflect a decrease and increase in the aggregate
principal amount of the Securities represented by
such Global Securities, such instructions to contain
information regarding the Depositary accounts to be
credited with such decrease and increase; and
(C) if the Company or the Trustee so requests, 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, or
other evidence reasonably satisfactory to it as to
the compliance with the restrictions set forth in the
Legend,
then the Trustee, (1) shall cause, or direct the
Registrar to cause, in accordance with the standing
26
instructions and procedures existing between the
Depositary and the Registrar, the aggregate principal
amount of the Securities represented by the appropriate
Global Security to be decreased by the aggregate
principal amount that the other Global Security is
increased and (2) in accordance with the standing
instructions and procedures existing between the
Depositary and the Registrar and Applicable Procedures,
shall debit and credit or cause to be debited or
credited, as appropriate, to the accounts of the persons
specified in such instructions a beneficial interest in
the Global Security or Global Securities, as
appropriate, equal to the amount of the beneficial
interests so transferred or exchanged.
(y) Beneficial interests in a Global Security may be
transferred to Persons who take delivery in the same
Global Security in accordance with the Applicable
Procedures and, if the Global Security is a Restricted
Security, in accordance with the transfer restrictions
set forth in the Legend. No written orders or
instructions shall be required to be delivered to the
Registrar or the Trustee to effect the transactions
described in this Section 2.12(a)(ii)(y).
(z) Other than transfers to the Company or to an
Affiliate of the Company, beneficial interests in a
Global Security that is not a Restricted Security may
not be transferred to Person who takes delivery thereof
in the form a beneficial interest in a Global Security
that is a Restricted Security.
(iii) Transfer or Exchange of a Beneficial Interest in a
Global Security for a Certificated Security. A beneficial interest in a Global
Security may not be exchanged for a Certificated Security except upon
satisfaction of the requirements set forth below and in Section 2.12(e)(1)
below. Upon receipt by the Trustee of a transfer of a beneficial interest in a
Global Security in accordance with Applicable Procedures for a Certificated
Security in the form satisfactory to the Trustee, together with:
(A) so long as the Securities are Restricted Securities,
certification in the form set forth in Exhibit C;
(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 Security to reflect a decrease in the
aggregate principal amount of the Securities represented by
the Global Security, such instructions to contain information
regarding the Depositary account to be credited with such
decrease; and
27
(C) if the Company or the Trustee so requests, 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, or other evidence reasonably satisfactory to it
as to the compliance with the restrictions set forth in the
Legend,
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 the Securities represented
by the Global Security to be decreased by the aggregate principal amount of the
Certificated Security to be issued, shall issue, authenticate and deliver such
Certificated Security and shall debit or cause to be debited to the account of
the person specified in such instructions a beneficial interest in the Global
Security equal to the principal amount of the Certificated Security so issued.
(iv) Transfer and Exchange of Certificated Securities. When
Certificated Securities are presented to the Registrar with a request:
(y) to register the transfer of such Certificated Securities; or
(z) to exchange such Certificated Securities for an equal principal
amount of Certificated Securities 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 Securities surrendered for transfer or exchange:
(1) 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
(2) so long as such Securities are Restricted Securities, such
Securities 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 Securities 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 Securities are being transferred to
the Company, a certification to that effect; or
28
(C) if such Certificated Securities are being transferred
pursuant to an exemption from registration, (i) a certification to
that effect (in the form set forth in Exhibit C, if applicable) and
(ii) if the Company so requests, 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, or other evidence
reasonably satisfactory to it as to the compliance with the
restrictions set forth in the Legend.
(v) Transfer of a Certificated Security for a Beneficial
Interest in a Global Security. A Certificated Security may not be exchanged for
a beneficial interest in a Global Security except upon satisfaction of the
requirements set forth below.
Upon receipt by the Trustee of a Certificated Security, duly
endorsed or accompanied by appropriate instruments of transfer, in form
satisfactory to the Trustee, together with:
(I) so long as the Securities are Restricted Securities,
certification, in the form set forth in Exhibit C, that such
Certificated Security is being transferred to a QIB in
accordance with Rule 144A, or to an institutional accredited
investor within the meaning of Rule 501(a)(1), (2), (3) or (7)
of Regulation D of the Securities Act; and
(II) 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 Security to reflect an
increase in the aggregate principal amount of the Securities
represented by the Global Security, such instructions to
contain information regarding the Depositary account to be
credited with such increase, then the Trustee shall cancel
such Certificated Security 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 Securities represented by
the Global Security to be increased by the aggregate principal
amount of the Certificated Security 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 Security equal to the principal amount of the
Certificated Security so cancelled. If no Global Securities
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 Security in the
appropriate principal amount.
29
(b) Subject to the succeeding Section (c), every Security
shall be subject to the restrictions on transfer provided in the Legend and
herein including the delivery of an opinion of counsel, if so provided. Whenever
any Restricted Security is presented or surrendered for transfer or for
exchange, such Security must be accompanied by a certificate in substantially
the form set forth in Exhibit C, dated the date of such surrender and signed by
the Holder of such Security, as to compliance with such restrictions on
transfer. The Registrar shall not be required to accept for such transfer or
exchange any Security not so accompanied by a properly completed certificate.
(c) The restrictions imposed by the Legend upon the
transferability of any Security shall cease and terminate when such Security has
been sold pursuant to an effective registration statement under the Securities
Act or transferred in compliance with Rule 144 under the Securities Act (or any
successor provision thereto) or, if earlier, upon the expiration of the holding
period applicable to sales thereof under Rule 144(k) under the Securities Act
(or any successor provision). Any Security as to which such restrictions on
transfer shall have expired in accordance with their terms or shall have
terminated may be exchanged for a new Security, of like tenor and aggregate
principal amount, which shall not bear the restrictive Legend, upon a surrender
of such Security for exchange to the Registrar in accordance with the provisions
of this Section 2.12 (accompanied, in the event that such restrictions on
transfer have terminated by reason of a transfer in compliance with Rule 144 or
any successor provision, by an opinion of counsel 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 Security has been made in compliance with Rule
144 or such successor provision). The Company shall inform the Trustee of the
effective date of any registration statement registering the Securities 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.
(d) As used in the preceding two paragraphs of this Section
2.12, the term "transfer" encompasses any sale, pledge, transfer, loan,
hypothecation, or other disposition of any interest in any Security.
(e) The provisions of clauses (1), (2), (3) and (4) below
shall apply only to Global Securities:
(1) Notwithstanding any other provisions of this Indenture or the
Securities, a Global Security shall not be exchanged in whole
or in part for a Security registered in the name of any Person
other than the Depositary or one or more nominees thereof,
provided that a Global Security may be exchanged for
Securities registered in the names of any Person designated by
the Depositary in the event that (i) the Depositary has
notified the Company that it is unwilling or unable to
continue as Depositary for such Global Security or such
30
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
Securities. Any Global Security exchanged pursuant to clause
(i) above shall be so exchanged in whole and not in part, and
any Global Security exchanged pursuant to clause (ii) above
may be exchanged in whole or from time to time in part as
directed by the Depositary. Any Security issued in exchange
for a Global Security or any portion thereof shall be a Global
Security; provided that any such Security so issued that is
registered in the name of a Person other than the Depositary
or a nominee thereof shall not be a Global Security.
(2) Securities issued in exchange for a Global Security or any
portion thereof shall be issued in definitive, fully
registered form, without interest coupons, shall have an
aggregate principal amount equal to that of such Global
Security or portion thereof to be so exchanged, shall be
registered in such names and be in such authorized
denominations as the Depositary shall designate and shall bear
the applicable legends provided for herein. Any Global
Security to be exchanged in whole shall be surrendered by the
Depositary to the Trustee, as Registrar. With regard to any
Global Security to be exchanged in part, either such Global
Security shall be so surrendered for exchange or, if the
Trustee is acting as custodian for the Depositary or its
nominee with respect to such Global Security, the principal
amount thereof shall be reduced, by an amount equal to the
portion thereof to be so exchanged, by means of an appropriate
adjustment made on the records of the Trustee. Upon any such
surrender or adjustment, the Trustee shall authenticate and
deliver the Security issuable on such exchange to or upon the
order of the Depositary or an authorized representative
thereof.
(3) Subject to the provisions of clause (5) below, the registered
Holder may grant proxies and otherwise authorize any Person,
including Agent Members (as defined below) and Persons that
may hold interests through Agent Members, to take any action
which a holder is entitled to take under this Indenture or the
Securities.
(4) In the event of the occurrence of any of the events specified
in clause (1) above, the Company will promptly make available
to the Trustee a reasonable supply of Certificated Securities
in definitive, fully registered form, without interest
coupons.
(5) Neither any members of, or participants in, the Depositary
(collectively, the "Agent Members") nor any other Persons on
whose behalf Agent Members may act shall have any rights under
this Indenture with respect to any Global Security registered
31
in the name of the Depositary or any nominee thereof, or under
any such Global Security, and the Depositary or such nominee,
as the case may be, may be treated by the Company, the Trustee
and any agent of the Company or the Trustee as the absolute
owner and holder of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein
shall prevent the Company, the Trustee or any agent of the
Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the
Depositary or such nominee, as the case may be, or impair, as
between the Depositary, its Agent Members and any other Person
on whose behalf an Agent Member may act, the operation of
customary practices of such Persons governing the exercise of
the rights of a holder of any Security.
(f) By its acceptance of any Security bearing the Legend, each
Holder of such Security acknowledges the restrictions on transfer of such
Security set forth in this Indenture and agrees that it will transfer such
Security only as provided in this Indenture.
SECTION 2.13. CUSIP NUMBERS.
The Company may issue the Securities with one or more "CUSIP" numbers
(if then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Trustee of any change in the CUSIP numbers.
ARTICLE 3
DISCHARGE OF INDENTURE
SECTION 3.1. DISCHARGE OF LIABILITY ON SECURITIES.
When (i) the Company delivers to the Trustee all outstanding
Securities (other than Securities replaced pursuant to Section 2.11) for
cancellation or (ii) all outstanding Securities have become due and payable at
their scheduled maturity within one year or all outstanding Securities are
scheduled for redemption within one year and the Company deposits with the
Trustee cash or, in the event of a conversion pursuant to Article 12, Common
Stock, sufficient to pay all amounts due and owing on all outstanding Securities
on the date of their scheduled maturity or the scheduled date of redemption
(other than Securities replaced pursuant to Section 2.11), and if in either case
the Company pays all other sums payable hereunder by the Company, then this
Indenture shall, subject to Section 5.8, cease to be of further effect. The
Trustee shall join in the execution of a document prepared by the Company
acknowledging satisfaction and discharge of this Indenture on demand of the
32
Company accompanied by an Officers' Certificate and Opinion of Counsel and at
the cost and expense of the Company.
SECTION 3.2. REPAYMENT TO THE COMPANY.
The Trustee and the Paying Agent shall return to the Company
upon written request any money or securities held by them for the payment of any
amount with respect to the Securities that remains unclaimed for two years,
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 Holders with respect to such money or securities for that
period commencing after the return thereof.
ARTICLE 4
DEFAULTS AND REMEDIES
SECTION 4.1. EVENTS OF DEFAULT.
An "Event of Default", wherever used herein, means any one of
the following events (whatever the reason for such Event of Default and whether
it shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(a) the Company defaults in the payment of the Principal
amount (a "DEFAULTED PAYMENT") on any Security when the same becomes due and
payable at its Stated Maturity, upon redemption or exercise of a repurchase
right or otherwise;
(b) the Company defaults in the payment of an installment of
Interest on any Security when it becomes due and payable and such default
continues for a period of 30 days;
(c) the Company fails to perform or observe any other term,
covenant or agreement contained in the Securities or this Indenture and the
default continues 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 Outstanding Securities;
(d) the Company defaults under any indebtedness for money
borrowed by the Company or any of its Subsidiaries that is a Significant
Subsidiary or any group of two or more Subsidiaries that, taken as a whole,
would constitute a Significant Subsidiary, the aggregate outstanding principal
amount of which is in an amount in excess of $15.0 million, for a period of 30
days after written notice to the Company by the Trustee or to the Company and
33
the Trustee by Holders of at least 25% in aggregate principal amount of the
Outstanding Securities, which default (i) is caused by the Company's failure to
pay when due principal or premium of or interest on such indebtedness by the end
of the applicable grace period, if any, unless such indebtedness is discharged
or (ii) results in the acceleration of such indebtedness without such
indebtedness having been discharged or such non-payment or acceleration having
been cured, waived, rescinded or annulled;
(e) the entry by a court having jurisdiction in the premises
of (i) a decree or order for relief in respect of the Company or any of its
Subsidiaries that is a Significant Subsidiary or any group of two or more
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary,
in an involuntary case or proceeding under any applicable U.S. federal or state
bankruptcy, insolvency, reorganization or other similar law or (ii) a decree or
order adjudging the Company or any of its Subsidiaries that is a Significant
Subsidiary or any group of two or more Subsidiaries that, taken as a whole,
would constitute a Significant Subsidiary, a bankrupt or insolvent, or approving
as properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company or any of its Subsidiaries that is a
Significant Subsidiary or any group of two or more Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary, under any applicable U.S.
federal or state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of any
substantial part of its property, or ordering the winding up or liquidation of
its affairs, and the continuance of any such decree or order for relief or any
such other decree or order unstayed and in effect for a period of 60 consecutive
days; or
(f) the commencement by the Company or any of its Subsidiaries
that is a Significant Subsidiary or any group of two or more Subsidiaries that,
taken as a whole, would constitute a Significant Subsidiary, of a voluntary case
or proceeding under any applicable U.S. federal or state bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to be
adjudicated a bankrupt or insolvent, or the consent by the Company or any of its
Subsidiaries that is a Significant Subsidiary or any group of two or more
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary,
to the entry of a decree or order for relief in respect of the Company or any of
its Subsidiaries that is a Significant Subsidiary or any group of two or more
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary,
in an involuntary case or proceeding under any applicable U.S. federal or state
bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against the
Company, or the filing by the Company or any of its Subsidiaries that is a
Significant Subsidiary or any group of two or more Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary, of a petition or answer or
consent seeking reorganization or relief under any applicable U.S. federal or
state law, or the consent by the Company to the filing of such petition or to
the appointment of or the taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official of the
Company or of any substantial part of its property, or the making by the Company
or any of its Subsidiaries that is a Significant Subsidiary or any group of two
or more Subsidiaries that, taken as a whole, would constitute a Significant
34
Subsidiary, of an assignment for the benefit of creditors, or the admission by
the Company or any of its Subsidiaries that is a Significant Subsidiary or any
group of two or more Subsidiaries that, taken as a whole, would constitute a
Significant Subsidiary, in writing of its inability to pay its debts generally
as they become due, or the taking of corporate action by the Company or any of
its Subsidiaries that is a Significant Subsidiary or any group of two or more
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary,
expressly in furtherance of any such action.
A Default under clause (c) or (d) above is not an Event of
Default until the Trustee notifies the Company, or the Holders of at least 25%
of the principal amount of the Outstanding Securities 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 (c) or (d) 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"
under this Indenture.
The Trustee shall, within 90 days of the occurrence of a
Default, give to the Holders of the Securities notice of all uncured Defaults
known to it and written notice of any event which with the giving of notice or
the lapse of time, or both, would become an Event of Default, its status and
what action the Company is taking or proposes to take with respect thereto;
provided, however, the Trustee shall be protected in withholding such notice if
it, in good faith, determines that the withholding of such notice is in the best
interest of such Holders, except in the case of a Default in the payment of the
Principal of or Interest on any of the Securities when due.
SECTION 4.2. ACCELERATION OF MATURITY; RESCISSION AND
ANNULMENT.
If an Event of Default with respect to Outstanding Securities
(other than an Event of Default specified in Section 4.1(e) or 4.1(f) hereof)
occurs and is continuing, the Trustee or the Holders of at least 25% in
aggregate principal amount of the Securities, at the time outstanding by written
notice to the Company (or to the Company and the Trustee in the case of an
action by Holders of Securities), may declare due and payable 100% of the
principal amount plus any accrued and unpaid Interest to the date of payment.
Upon a declaration of acceleration, such Principal amount and accrued and unpaid
Interest to the date of payment shall be immediately due and payable.
If an Event of Default specified in Section 4.1(e) and 4.1(f)
occurs, the Principal and accrued and unpaid Interest on the Securities shall
become and be immediately due and payable, without any declaration or other act
on the part of the Trustee or any Holder.
The Holders either (a) through notice to the Trustee of not
less than a majority of the aggregate principal amount of the Outstanding
Securities, or (b) by the adoption of a resolution, at a meeting of Holders of
the Outstanding Securities at which a quorum is present, by the Holders of at
least a majority of the aggregate principal amount of the Outstanding Securities
represented at such meeting, may, on behalf of the Holders of all of the
Securities, rescind and annul an acceleration and its consequences (including
waiver of any defaults) if:
35
(1) all existing Events of Default, other than the nonpayment
of a Defaulted Payment on the Securities which have become due solely because of
the acceleration, have been remedied, cured or waived, and
(2) the rescission would not conflict with any judgment or
decree of a court of competent jurisdiction;
provided, however, that in the event such declaration of acceleration has been
made based on the existence of an Event of Default under Section 4.1(d) and the
default with respect to indebtedness for money borrowed which gave rise to such
Event of Default has been remedied, cured or waived, then, without any further
action by the Holders, such declaration of acceleration shall be rescinded
automatically and the consequences of such declaration shall be annulled. No
such rescission or annulment shall affect any subsequent Default or impair any
right consequent thereon.
SECTION 4.3. OTHER REMEDIES.
If an Event of Default with respect to Outstanding Securities
occurs and is continuing, the Trustee may pursue any available remedy by
proceeding at law or in equity to collect the payment of the principal amount
plus Interest and Aditional Amounts, if any, due and payable on the Securities
or to enforce the performance of any provision of the Securities.
The Trustee may maintain a proceeding in which it may
prosecute and enforce all rights of action and claims under this Indenture or
the Securities, even if it does not possess any of the Securities or does not
produce any of them in the proceeding.
SECTION 4.4. WAIVER OF PAST DEFAULTS.
The Holders, either (a) through the written consent of not
less than a majority of the aggregate principal amount of the Outstanding
Securities, or (b) by the adoption of a resolution, at a meeting of Holders of
the Outstanding Securities at which a quorum is present, by the Holders of at
least a majority of the aggregate principal amount of the Outstanding Securities
represented at such meeting, may, on behalf of the Holders of all of the
Securities, waive an existing Default or Event of Default, except a Default or
Event of Default:
(1) set forth in Sections 4.1(a) and (b), provided, however,
that subject to Section 4.7, the Holders of a majority of the aggregate
principal amount of the Outstanding Securities may rescind an acceleration and
its consequences, including any related payment Default that resulted from such
acceleration); or
36
(2) in respect of a covenant or provision hereof which, under
Section 7.2 hereof, cannot be modified or amended without the consent of the
Holders of each Security affected.
Upon any such waiver, such Default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; provided, however, that no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereon.
SECTION 4.5. CONTROL BY MAJORITY.
The Holders of a majority of the aggregate principal amount of
the Outstanding Securities (or such lesser amount as shall have acted at a
meeting pursuant to the provisions of this Indenture) shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee. However, the Trustee may refuse to follow any direction that:
(1) conflicts with any law or with this Indenture;
(2) the Trustee determines may be unduly prejudicial to the
rights of the Holders not joining therein; or
(3) may expose the Trustee to personal liability.
The Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 4.6. LIMITATION ON SUIT.
No Holder of any Security shall have any right to pursue any
remedy with respect to this Indenture or the Securities (including, instituting
any proceeding, judicial or otherwise, with respect to this Indenture or for the
appointment of a receiver or trustee) unless:
(1) such Holder has previously given written notice to the
Trustee of an Event of Default that is continuing;
(2) the Holders of at least 25% of the principal amount of the
Outstanding Securities shall have made written request to the Trustee to pursue
the remedy;
(3) such Holder or Holders have offered to the Trustee
indemnity satisfactory to it against any costs, expenses and liabilities
incurred in complying with such request;
37
(4) the Trustee has failed to comply with the request for 60
days after its receipt of such notice, request and offer of indemnity; and
(5) during such 60-day period, no direction inconsistent with
such written request has been given to the Trustee by the Holders of a majority
of the aggregate principal amount of the Outstanding Securities (or such amount
as shall have acted at a meeting pursuant to the provisions of this Indenture);
provided, however, that no one or more of such Holders may use this Indenture to
prejudice the rights of another Holder or to obtain preference or priority over
another Holder.
SECTION 4.7. UNCONDITIONAL RIGHTS OF HOLDERS TO RECEIVE
PAYMENT AND TO CONVERT.
Notwithstanding any other provision in this Indenture, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the Principal on and Interest in respect of
the Securities held by such Holder, on or after the respective due dates, to
convert the Securities in accordance with Article 12 or to bring suit for the
enforcement of any such payment on or after such respective dates or the right
to convert, and such rights shall not be impaired or affected adversely without
the consent of such Holder.
SECTION 4.8. COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY THE TRUSTEE.
The Company covenants that if:
(1) a Default or Event of Default is made in the payment of
Interest on any Security when such Interest becomes due and payable and such
Default or Event of Default continues for a period of 30 days; or
(2) a Default or Event of Default is made in the payment of
the Principal on any Security when the same becomes due and payable at its
Stated Maturity, upon redemption or exercise of the repurchase right or
otherwise,
then the Company will, upon demand of the Trustee, pay to it,
for the benefit of the Holders of such Securities, the entire Principal then due
and payable (as expressed therein or as a result of any acceleration effected
pursuant to Section 4.2 hereof) on such Securities for any such amounts and, to
the extent legally enforceable, Interest on such Securities, and, in addition
thereto, such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
38
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust, may
institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Company and collect the monies adjudged or decreed
to be payable in the manner provided by law out of the property of the Company,
wherever situated.
If an Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights
of the Holders of Securities by such appropriate judicial proceedings as the
Trustee shall deem most effectual to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy.
SECTION 4.9. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or the property of the Company
or its creditors, the Trustee (irrespective of whether the Principal 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:
(1) to file and prove a claim for the whole amount of the
Principal or Interest or Repurchase Price, if any, owing and unpaid in respect
of the Securities and to file such other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee (including any claim for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel) and of the Holders of Securities allowed in
such judicial proceeding and
(2) to collect and receive any monies, Common Stock or other
property payable or deliverable on any such claim and to distribute the same,
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceedings is hereby authorized by
each Holder of Securities to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders of Securities, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel and any other amounts due the Trustee under Section 5.8.
Nothing contained herein shall be deemed to authorize the
Trustee to authorize or consent to or accept, or adopt on behalf of any Holder
of a Security, any plan of reorganization, arrangement, adjustment or
composition affecting the Securities or the rights of any Holder thereof or to
39
authorize the Trustee to vote in respect of the claim of any Holder of a
Security in any such proceeding.
SECTION 4.10. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder of a Security has instituted any
proceeding to enforce any right or remedy under this Indenture and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee or to such Holder, then and in every such
case, subject to any determination in such proceeding, the Company, the Trustee
and the Holders of Securities shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
SECTION 4.11. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities in the last
paragraph of Section 2.7, no right or remedy conferred in this Indenture upon or
reserved to the Trustee or to the Holders of Securities is intended to be
exclusive of any other right or remedy, and every right and remedy shall, to the
extent permitted by law, be cumulative and in addition to every other right and
remedy given hereunder or hereafter existing at law or in equity or otherwise.
The assertion or employment of any right or remedy hereunder, or otherwise,
shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
SECTION 4.12. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Holder of any
Security to exercise any right or remedy accruing upon any Event of Default
shall impair any such right or remedy or constitute a waiver of any such Event
of Default or any acquiescence therein. Every right and remedy given by this
Article or by law to the Trustee or to the Holders of Securities may be
exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by the Holders of Securities, as applicable.
SECTION 4.13. PRIORITIES.
Any money collected by the Trustee pursuant to this Article
shall be applied in the following order, at the date or dates fixed by the
Trustee:
FIRST: to the payment of all amounts due to the Trustee under
Section 5.8;
SECOND: to Holders for amounts due and unpaid on the
Securities for the Principal or Interest as applicable, ratably, without
preference or priority of any kind, according to such amounts due and payable on
the Securities; and
40
THIRD: any remaining amounts shall be repaid to the Company.
The Trustee may fix a special record date and payment date for
any payment to Holders pursuant to this Section 4.13. At least 15 days before
such special record date, the Trustee shall mail to each Holder and the Company
a notice that states the special record date, the payment date and the amount to
be paid.
SECTION 4.14. UNDERTAKING FOR COSTS.
All parties to this Indenture agree, and each Holder of any
Security by such Holder's acceptance thereof shall be deemed to have agreed,
that any court may in its discretion require, in any suit for the enforcement of
any right or remedy under this Indenture, or in any suit against the Trustee for
any action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% of the aggregate principal amount of the Outstanding
Securitiesf, or to any suit instituted by any Holder of any Security for the
enforcement of (i) payments pursuant to Section 4.7, (ii) repurchase rights in
accordance with Article 11 or (iii) conversion rights in accordance with Article
12. This Section 4.14 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 4.15. WAIVER OF STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim to take the benefit or advantage of, any stay or extension law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
ARTICLE 5
THE TRUSTEE
SECTION 5.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) Except during the continuance of an Event of Default,
41
(1) The Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture or the TIA, and no
implied covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) In the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture; provided, however,
that in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the Trustee
shall examine the certificates or opinions to determine whether or not, on their
face, they conform to the requirements to this Indenture (but need not
investigate or confirm the accuracy of any facts stated therein).
(b) In case an Event of Default actually known to a
Responsible Officer of the Trustee has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of such person's
own affairs.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(1) This paragraph (c) shall not be construed to limit the
effect of paragraph (a) of this Section 5.1;
(2) The Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) The Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with a direction
received by it of the Holders of a majority of the aggregate principal amount of
the Outstanding Securities (or such lesser amount as shall have acted at a
meeting pursuant to the provisions of this Indenture) relating to the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee, under this
Indenture.
(d) Whether or not herein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Section 5.1.
(e) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers. The Trustee may refuse to perform any duty or exercise any
right or power unless it receives indemnity reasonably satisfactory to it
42
against any loss, liability, cost or expense (including, without limitation,
reasonable fees and expenses of counsel).
(f) The Trustee shall not be obligated to pay interest on any
money or other assets received by it unless otherwise agreed in writing with the
Company. Assets held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.
(g) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, coupon, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney at the sole cost of the Company and shall incur no
liability or additional liability of any kind by reason of such inquiry or
investigation.
(h) The Trustee shall not be deemed to have notice or actual
knowledge of any Event of Default unless a Responsible Officer of the Trustee
has actual knowledge thereof or unless written notice of any event which is in
fact a Default is received by the Trustee pursuant to Section 13.2 hereof, and
such notice references the Securities and this Indenture.
(i) The rights, privileges, protections, immunities and
benefits given to the Trustee hereunder, including, without limitation, its
right to be indemnified, are extended to, and shall be enforceable by, the
Trustee in each of its capacities hereunder, and each Paying Agent,
authenticating agent, Conversion Agent or Registrar acting hereunder.
(j) The Trustee may request that the Company deliver an
Officers' Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Indenture, which Officers' Certificate may be signed by any person authorized to
sign an Officers' Certificate, including any person specified as so authorized
in any such certificate previously delivered and not superseded.
SECTION 5.2. CERTAIN RIGHTS OF TRUSTEE.
Subject to the provisions of Section 5.1 hereof and subject to
Section 315(a) through (d) of the TIA:
(1) The Trustee may conclusively rely on any document believed
by it to be genuine and to have been signed or presented by the proper person.
The Trustee need not investigate any fact or matter stated in the document.
43
(2) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel, or both. The Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on the Officers' Certificate or Opinion of Counsel.
(3) The Trustee may act through attorneys and agents and shall
not be responsible for the misconduct or negligence of any attorney or agent
appointed with due care.
(4) The Trustee shall not be liable for any action taken or
omitted to be taken by it in good faith which it believed to be authorized or
within the discretion or rights or powers conferred upon it by this Indenture,
unless the Trustee's conduct constitutes negligence.
(5) The Trustee may consult with counsel of its selection and
the advice of such counsel as to matters of law or legal interpretation shall be
full and complete authorization and protection in respect of any action taken,
omitted or suffered by it hereunder in good faith and in accordance with the
advice or opinion of such counsel.
(6) Unless otherwise specifically provided in this Indenture,
any demand, request, direction or notice from the Company shall be sufficient if
signed by an Officer of the Company.
(7) The permissive rights of the Trustee to do things
enumerated in this Indenture shall not be construed as a duty unless so
specified herein.
SECTION 5.3. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become
the owner or pledgee of Securities and may otherwise deal with the Company or
any Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest (as such term is defined in Section 310(b) of the TIA), it must
eliminate such conflict within 90 days, apply to the Commission for permission
to continue as trustee (to the extent permitted under Section 310(b) of the TIA)
or resign. Any agent may do the same with like rights and duties. The Trustee is
also subject to Sections 5.11 and 5.12 hereof.
SECTION 5.4. MONEY HELD IN TRUST.
Money held by the Trustee in trust hereunder shall not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise expressly agreed with the Company.
44
SECTION 5.5. TRUSTEE'S DISCLAIMER.
The recitals contained herein and in the Securities (except
for those in the certificate of authentication) shall be taken as the statements
of the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity, sufficiency or priority
of this Indenture or of the Securities. The Trustee shall not be accountable for
the use or application by the Company of Securities or the proceeds thereof.
SECTION 5.6. NOTICE OF DEFAULTS.
Within 90 days after the occurrence of any Default or Event of
Default hereunder of which a Responsible Officer of the Trustee has received
written notice, the Trustee shall give notice to Holders, unless such Default or
Event of Default shall have been cured or waived; provided, however, that,
except in the case of a Default or Event of Default described in Sections 4.1(a)
or (b), the Trustee shall be protected in withholding such notice if and so long
as Responsible Officers of the Trustee in good faith determine that the
withholding of such notice is in the interest of the Holders. The second
sentence of this Section 5.6 shall be in lieu of the proviso to Section 315(b)
of the TIA and such proviso is hereby expressly excluded from this Indenture, as
permitted by the TIA. The Trustee shall not be deemed to have knowledge of a
Default unless a Responsible Officer of the Trustee has received written notice
of such Default.
SECTION 5.7. REPORTS BY TRUSTEE TO HOLDERS.
The Trustee shall transmit to Holders such reports concerning
the Trustee and its actions under this Indenture as may be required by Section
313 of the TIA at the times and in the manner provided by the TIA.
A copy of each report at the time of its mailing to Holders
shall be filed with the SEC, if required, and each stock exchange, if any, on
which the Securities and the Common Stock are listed. The Company shall promptly
notify the Trustee when the Securities or the Common Stock become listed on any
stock exchange.
SECTION 5.8. COMPENSATION AND INDEMNIFICATION.
The Company covenants and agrees to pay to the Trustee from
time to time, and the Trustee shall be entitled to, such compensation as agreed
to in writing by the Trustee and the Company (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
and the Company covenants and agrees to pay or reimburse the Trustee upon its
request for all reasonable expenses, disbursements and advances incurred or made
by or on behalf of it in accordance with any of the provisions of this Indenture
(including the reasonable compensation and the expenses and disbursements of its
counsel and of all agents and other persons not regularly in its employ), except
to the extent that any such expense, disbursement or advance is due to its
negligence or bad faith. When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 4.1, the expenses
(including the reasonable charges and expenses of its counsel) and the
45
compensation for the services are intended to constitute expenses of
administration under any bankruptcy law. The Company also covenants to indemnify
the Trustee and its officers, directors, employees and agents for, and to hold
such Persons harmless against, any loss, liability or expense incurred by them,
arising out of or in connection with the acceptance or administration of this
Indenture or the trusts hereunder or the performance of their duties hereunder,
including the costs and expenses of defending themselves against or
investigating any claim of liability in the premises, except to the extent that
any such loss, liability or expense was due to the negligence or willful
misconduct of such Persons. The obligations of the Company under this Section
5.8 to compensate and indemnify the Trustee and its officers, directors,
employees and agents and to pay or reimburse such Persons for expenses,
disbursements and advances shall constitute additional indebtedness hereunder
and shall survive the satisfaction and discharge of this Indenture or the
earlier resignation or removal of the Trustee. Such additional indebtedness
shall be a lien prior to that of the Securities upon all property and funds held
or collected by the Trustee as such, except funds held in trust for the benefit
of the Holders of particular Securities, and the Securities are hereby
subordinated to such senior claim. "Trustee" for purposes of this Section 5.8
shall include any predecessor Trustee, in its capacity as Trustee, but the
negligence or willful misconduct of any Trustee shall not affect the
indemnification of any other Trustee.
SECTION 5.9. REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 5.9.
The Trustee may resign and be discharged from the trust hereby
created by so notifying the Company in writing. The Holders of at least a
majority of the principal amount of Outstanding Securities may remove the
Trustee by so notifying the Trustee and the Company in writing. The Company must
remove the Trustee if:
(i) the Trustee fails to comply with Section 5.11 hereof or
Section 310 of the TIA;
(ii) the Trustee becomes incapable of acting;
(iii) the Trustee is adjudged a bankrupt or an insolvent or an
order for relief is entered with respect to the Trustee under any Bankruptcy
Law; or
(iv) a Custodian or public officer takes charge of the Trustee
or its property.
If the Trustee resigns or is removed or if a vacancy exists in
the office of the Trustee for any reason, the Company shall promptly appoint a
successor Trustee. The Trustee shall be entitled to payment of its fees and
reimbursement of its expenses while acting as Trustee. Within one year after the
successor Trustee takes office, the Holders of at least a majority of the
46
aggregate principal amount of Outstanding Securities may appoint a successor
Trustee to replace the successor Trustee appointed by the Company.
Any Holder may petition any court of competent jurisdiction
for the removal of the Trustee and the appointment of a successor Trustee if the
Trustee fails to comply with Section 5.11.
If an instrument of acceptance by a successor Trustee shall
not have been delivered to the Trustee within 30 days after the giving of such
notice of resignation or removal, the resigning or removed Trustee, as
applicable, may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The Company shall issue a notice of the successor
Trustee's succession to the Holders. Upon payment of its charges, the retiring
Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee, subject nevertheless to its lien, if any, provided for in
Section 5.8 hereof. Notwithstanding replacement of the Trustee pursuant to this
Section 5.9 hereof, the Company's obligations under Section 5.8 hereof shall
continue for the benefit of the retiring Trustee with respect to expenses,
losses and liabilities incurred by it prior to such replacement.
SECTION 5.10. SUCCESSOR TRUSTEE BY MERGER, ETC.
Subject to Section 5.11 hereof, if the Trustee consolidates
with, merges or converts into, or transfers all or substantially all of its
corporate trust business to, another corporation or national banking
association, the successor entity without any further act shall be the successor
Trustee as to the Securities.
SECTION 5.11. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
The Trustee shall at all times satisfy the requirements of
Section 310(a)(1), (2) and (5) of the TIA. The Trustee shall at all times have
(or, in the case of a corporation included in a bank holding company system, the
related bank holding company shall at all times have), a combined capital and
surplus of at least $50 million as set forth in its (or its related bank holding
company's) most recent published annual report of condition. The Trustee is
subject to Section 310(b) of the TIA.
SECTION 5.12. COLLECTION OF CLAIMS AGAINST THE COMPANY.
The Trustee is subject to Section 311(a) of the TIA, excluding
any creditor relationship listed in Section 311(b) of the TIA. A Trustee who has
resigned or been removed shall be subject to Section 311(a) of the TIA to the
extent indicated therein.
47
ARTICLE 6
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 6.1. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN
TERMS.
The Company shall not consolidate with or merge into any other
Person or convey, transfer or lease its properties and assets substantially as
an entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless:
(1) in the event that the Company shall consolidate with or
merge into another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which acquires
by conveyance or transfer, or which leases, the properties and assets of the
Company substantially as an entirety shall be a corporation, organized and
validly existing under the laws of the United States of America, any State
thereof or the District of Columbia;
(2) in the event that the Company shall consolidate with or
merge into another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, and the entity surviving such
transaction or transferee entity is not the Company, then such surviving or
transferee entity shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Trustee, in form reasonably satisfactory to the
Trustee, the due and punctual payment of all and any amounts when due on all the
Securities and the performance of every covenant of this Indenture and the
Securities on the part of the Company to be performed or observed and shall have
provided for the conversion rights provided in Article 12;
(3) immediately after giving effect to such transaction, no
Event of Default, and no Default, shall have occurred and be continuing; and
(4) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a supplemental
indenture is required in connection with such transaction, such supplemental
indenture, comply with this Article and that all conditions precedent herein
provided for relating to such transaction have been complied with.
SECTION 6.2. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger by the Company with or into
any other corporation or any conveyance, transfer or lease of the properties and
assets of the Company substantially as an entirety to any Person, in accordance
with Section 6.1 hereof, the successor corporation formed by such consolidation
48
or into which the Company is merged or to which such conveyance, transfer or
lease is made shall succeed to, and be substituted for, and may exercise every
right and power of, the Company under this Indenture with the same effect as if
such successor corporation had been named as the Company herein. In the event of
any such conveyance or transfer, the Company (which term shall for this purpose
mean the Person named as the "Company" in the first paragraph of this Indenture
or any successor Person which shall theretofore become such in the manner
described in Section 6.1 hereof), except in the case of a lease to another
Person, the predecessor corporation shall be relieved of all obligations and
covenants under this Indenture and the Securities and may be dissolved and
liquidated.
ARTICLE 7
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 7.1. WITHOUT CONSENT OF HOLDERS OF SECURITIES.
Without the consent of any Holders of Securities, the Company,
when authorized by a Board Resolution, and the Trustee, at any time and from
time to time, may amend this Indenture and the Securities to:
(a) add to the covenants of the Company for the benefit of the
Holders of Securities;
(b) surrender any right or power herein conferred upon the
Company;
(c) provide for conversion rights of Holders of Securities if
any reclassification or change of the Company's Common Stock or any
consolidation, merger or sale of all or substantially all of the Company's
assets occurs;
(d) provide for the assumption of the Company's obligations to
the Holders of Securities in the case of a merger, consolidation, conveyance,
transfer or lease pursuant to Article 6 hereof;
(e) reduce the Conversion Price; provided, however, that such
reduction in the Conversion Price shall not adversely affect the interest of the
Holders of Securities (after taking into account tax and other consequences of
such reduction);
(f) comply with the requirements of the Commission in order to
effect or maintain the qualification of this Indenture under the TIA;
(g) make any changes or modifications necessary in connection
with the registration of the Securities under the Securities Act as contemplated
in the Registration Rights Agreement, provided that such change or modification
does not, in the good faith opinion of the Board of Directors and the Trustee,
adversely affect the interest of the Holders in any material respect;
49
(h) cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein or which is
otherwise defective, or to make any other provisions with respect to matters or
questions arising under this Indenture which the Company may deem necessary or
desirable and which shall not be inconsistent with the provisions of this
Indenture; provided, however, that such action pursuant to this clause (h) does
not, in the good faith opinion of the Board of Directors of the Company (as
evidenced by a Board Resolution), adversely affect the interests of the Holders
of Securities in any material respect;
(i) add any guarantees with respect to the Securities; and
(j) add or modify any other provisions herein with respect to
matters or questions arising hereunder which the Company and the Trustee may
deem necessary or desirable and which will not adversely affect in any material
respects the interests of the Holders of Securities.
SECTION 7.2. WITH CONSENT OF HOLDERS OF SECURITIES.
Except as provided below in this Section 7.2, this Indenture
or the Securities may be amended, modified or supplemented, and noncompliance in
any particular instance with any provision of this Indenture or the Securities
may be waived, in each case (i) with the written consent of the Holders of at
least a majority of the aggregate principal amount of the Outstanding Securities
or (ii) by the adoption of a resolution, at a meeting of Holders of the
Outstanding Securities at which a quorum is present, by the Holders of a
majority of the aggregate principal amount of the Outstanding Securities
represented and voting at such meeting pursuant to Section 8.4.
Without the written consent or the affirmative vote of each
Holder of Securities affected thereby, an amendment or waiver under this Section
7.2 may not:
(a) change the Stated Maturity of the principal amount of, or
any installment of Interest on, any Security;
(b) reduce the Principal, Interest, Redemption Price or
Repurchase Price payable on any Security;
(c) change the currency of any amount owed or owing under the
Security or any interest thereon from U.S. Dollars;
(d) alter or otherwise modify the Interest Rate on any
Security, or the manner of calculation thereof, or extend time for payment of
any Interest due and payable to the Holders of the Securities;
(e) impair the right of any Holder to institute suit for the
enforcement of any payment in or with respect to any Security;
50
(f) modify the obligation of the Company to maintain an office
or agency in The City of New York pursuant to Section 9.2;
(g) except as otherwise permitted herein, adversely affect the
purchase right of the Holders of the Securities as provided in Article 11 or the
right of the Holders of the Securities to convert any Security as provided in
Article 12;
(h) modify the provisions of Article 10 in a manner adverse to
the Holders of the Securities; or
(i) modify any of the provisions of this Section, or reduce
the percentage of voting interests required to waive a default, except to
provide that certain other provisions of this Indenture cannot be modified or
waived without the consent of the Holder of each Security affected thereby.
It shall not be necessary for any Act of Holders of Securities
under this Section 7.2 to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act shall approve the
substance thereof.
SECTION 7.3. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment to this Indenture or the Securities shall be
set forth in a supplemental indenture that complies with the TIA as then in
effect.
SECTION 7.4. REVOCATION OF CONSENTS AND EFFECT OF CONSENTS OR
VOTES.
Until an amendment, supplement or waiver becomes effective, a
written consent to it by a Holder is a continuing consent by the Holder and
every subsequent Holder of a Security or portion of a Security that evidences
the same debt as the consenting Holder's Security, even if notation of the
consent is not made on any Security; provided, however, that unless a record
date shall have been established, any such Holder or subsequent Holder may
revoke the consent as to its Security or portion of a Security if the Trustee
receives written notice of revocation before the date the amendment, supplement
or waiver becomes effective.
An amendment, supplement or waiver becomes effective on
receipt by the Trustee of written consents from or affirmative votes by, as
applicable, the Holders of the requisite percentage of the aggregate principal
amount of the Outstanding Securities, and thereafter shall bind every Holder of
Securities; provided, however, if the amendment, supplement or waiver makes a
change described in any of the clauses (a) through (i) of Section 7.2, the
amendment, supplement or waiver shall bind only each Holder of a Security which
has consented to it or voted for it, as applicable, and every subsequent Holder
of a Security or portion of a Security that evidences the same indebtedness as
the Security of the consenting or affirmatively voting Holder, as applicable.
51
SECTION 7.5. NOTATION ON OR EXCHANGE OF SECURITIES.
If an amendment, supplement or waiver changes the terms of a
Security:
(a) the Trustee may require the Holder of a Security to
deliver such Securities to the Trustee, the Trustee may place an appropriate
notation on the Security about the changed terms and return it to the Holder and
the Trustee may place an appropriate notation on any Security thereafter
authenticated; or
(b) if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall authenticate a
new Security that reflects the changed terms.
Failure to make the appropriate notation or issue a new
Security shall not affect the validity and effect of such amendment, supplement
or waiver.
SECTION 7.6. TRUSTEE TO SIGN AMENDMENT, ETC.
The Trustee shall sign any amendment authorized pursuant to
this Article 7 if the amendment does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If the amendment does adversely affect
the rights, duties, liabilities or immunities of the Trustee, the Trustee may
but need not sign it. In signing or refusing to sign any amendment hereunder,
the Trustee shall be entitled to receive and shall be fully protected in relying
upon an Officers' Certificate and an Opinion of Counsel as conclusive evidence
that such amendment is authorized or permitted by this Indenture and that all
conditions precedent relating thereto have been complied with.
ARTICLE 8
MEETING OF HOLDERS OF SECURITIES
SECTION 8.1. PURPOSES FOR WHICH MEETINGS MAY BE CALLED.
A meeting of Holders of Securities may be called at any time
and from time to time pursuant to this Article to make, give or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be made, given or taken by Holders of
Securities.
SECTION 8.2. CALL NOTICE AND PLACE OF MEETINGS.
(a) The Trustee may at any time call a meeting of Holders of
Securities for any purpose specified in Section 8.1, to be held at such time and
at such place in The City of New York. Notice of every meeting of Holders of
Securities, setting forth the time and the place of such meeting and in general
terms the action proposed to be taken at such meeting, shall be given, in the
manner provided in Section 13.2, not less than 21 nor more than 180 days prior
to the date fixed for the meeting.
52
(b) In case at any time the Company, pursuant to a Board
Resolution, or the Holders of at least 10% of the aggregate principal amount of
the Outstanding Securities shall have requested the Trustee to call a meeting of
the Holders of Securities for any purpose specified in Section 8.1 hereof, by
written request setting forth in reasonable detail the action proposed to be
taken at the meeting, and the Trustee shall not have made the first publication
of the notice of such meeting within 21 days after receipt of such request or
shall not thereafter proceed to cause the meeting to be held as provided herein,
then the Company or the Holders of Securities in the amount specified, as
applicable, may determine the time and the place in The City of New York for
such meeting and may call such meeting for such purposes by giving notice
thereof as provided in paragraph (a) of this Section 8.2.
SECTION 8.3. PERSONS ENTITLED TO VOTE AT MEETINGS.
To be entitled to vote at any meeting of Holders of
Securities, a Person shall be (a) a Holder of one or more Outstanding
Securities, or (b) a Person appointed by an instrument in writing as proxy for a
Holder or Holders of one or more Outstanding Securities by such Holder or
Holders. The only Persons who shall be entitled to be present or to speak at any
meeting of Holders shall be the Persons entitled to vote at such meeting and
their counsel, any representatives of the Trustee and its counsel, and any
representatives of the Company and its counsel.
SECTION 8.4. QUORUM; ACTION.
The Persons entitled to vote a majority of the aggregate
principal amount of the Outstanding Securities shall constitute a quorum. In the
absence of a quorum within 30 minutes of the time appointed for any such
meeting, the meeting shall, if convened at the request of Holders of Securities,
be dissolved. In any other case, the meeting may be adjourned for a period of
not less than 10 days as determined by the chairman of the meeting prior to the
adjournment of such meeting. In the absence of a quorum at any such adjourned
meeting, such adjourned meeting may be further adjourned for a period of not
less than 10 days as determined by the chairman of the meeting prior to the
adjournment of such adjourned meeting. Notice of the reconvening of any
adjourned meeting shall be given as provided in Section 8.2(a), except that such
notice need be given only once and not less than five days prior to the date on
which the meeting is scheduled to be reconvened. Notice of the reconvening of an
adjourned meeting shall state expressly the percentage of the aggregate
principal amount of the Outstanding Securities which shall constitute a quorum.
Subject to the foregoing, at the reconvening of any meeting
adjourned for a lack of a quorum, the Persons entitled to vote 25% of the
aggregate principal amount of the Outstanding Securities shall constitute a
quorum for the taking of any action set forth in the notice of the original
meeting.
At a meeting or an adjourned meeting duly reconvened and at
which a quorum is present as aforesaid, any resolution and all matters (except
as limited by Section 7.2) shall be effectively passed and decided if passed or
53
decided by the Persons entitled to vote not less than a majority of the
aggregate principal amount of Outstanding Securities represented and voting at
such meeting.
Any resolution passed or decisions taken at any meeting of
Holders of Securities duly held in accordance with this Section shall be binding
on all the Holders of Securities, whether or not present or represented at the
meeting.
SECTION 8.5. DETERMINATION OF VOTING RIGHTS; CONDUCT AND
ADJOURNMENT OF MEETINGS.
(a) Notwithstanding any other provisions of this Indenture,
the Trustee may make such reasonable regulations as it may deem advisable for
any meeting of Holders of Securities in regard to proof of the holding of
Securities and of the appointment of proxies and in regard to the appointment
and duties of inspectors of votes, the submission and examination of proxies,
certificates and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall deem appropriate. Except as
otherwise permitted or required by any such regulations, the holding of
Securities shall be proved in the manner specified in Section 13.4 hereof and
the appointment of any proxy shall be proved in the manner specified in Section
13.4 hereof. Such regulations may provide that written instruments appointing
proxies, regular on their face, may be presumed valid and genuine without the
proof specified in Section 13.4 hereof or other proof.
(b) The Trustee shall, by an instrument in writing, appoint a
temporary chairman (which may be the Trustee) of the meeting, unless the meeting
shall have been called by the Company or by Holders of Securities as provided in
Section 8.2(b), in which case the Company or the Holders of Securities calling
the meeting, as applicable, shall in like manner appoint a temporary chairman. A
permanent chairman and a permanent secretary of the meeting shall be elected by
vote of the Persons entitled to vote a majority of the aggregate principal
amount of the Outstanding Securities represented at the meeting.
(c) At any meeting, each Holder of a Security or proxy shall
be entitled to one vote for each $1,000 principal amount of Securities held or
represented by him; provided, however, that no vote shall be cast or counted at
any meeting in respect of any Security challenged as not outstanding and ruled
by the chairman of the meeting to be not outstanding. The chairman of the
meeting shall have no right to vote, except as a Holder of a Security or proxy.
(d) Any meeting of Holders of Securities duly called pursuant
to Section 8.2 at which a quorum is present may be adjourned from time to time
by Persons entitled to vote a majority of the aggregate principal amount of the
Outstanding Securities represented at the meeting, and the meeting may be held
as so adjourned without further notice.
54
SECTION 8.6. COUNTING VOTES AND RECORDING ACTION OF MEETINGS.
The vote upon any resolution submitted to any meeting of
Holders of Securities shall be by written ballots on which shall be subscribed
the signatures of the Holders of Securities or of their representatives by proxy
and the principal amount and serial numbers of the Outstanding Securities held
or represented by them. The permanent chairman of the meeting shall appoint two
inspectors of votes who shall count all votes cast at the meeting for or against
any resolution and who shall make and file with the secretary of the meeting
their verified written reports in duplicate of all votes cast at the meeting. A
record, at least in duplicate, of the proceedings of each meeting of Holders of
Securities shall be prepared by the secretary of the meeting and there shall be
attached to said record the original reports of the inspectors of votes on any
vote by ballot taken thereat and affidavits by one or more Persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was given as provided in Section 8.2 and, if
applicable, Section 8.4. Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to the Company and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting. Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
ARTICLE 9
COVENANTS
SECTION 9.1. PAYMENT OF PRINCIPAL, REDEMPTION PRICE,
REPURCHASE PRICE AND INTEREST.
The Company will duly and punctually make all payments in
respect of the Securities including the Principal of and Interest on the
Securities and the Redemption Price and the Repurchase Price when and if at any
time any such foregoing amounts are due and payable in accordance with the terms
of the Securities and this Indenture. The Company will deposit or cause to be
deposited with the Trustee as directed by the Trustee, on or before the day of
the Stated Maturity of any Security, all payments so due.
SECTION 9.2. MAINTENANCE OF OFFICES OR AGENCIES.
The Company hereby appoints the Trustee's Corporate Trust
Office as its office in the Borough of Manhattan, The City of New York, where
Securities may be:
(i) presented or surrendered for payment;
(ii) surrendered for registration of transfer or exchange;
(iii) surrendered for conversion;
55
and where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served.
The Company will maintain in The City of New York, an office
or agency where Securities may be presented or surrendered for payment, where
Securities may be surrendered for registration of transfer or exchange, where
Securities may be surrendered for conversion and where notices and demands to or
upon the Company in respect of the Securities and this Indenture may be served.
The Company will give prompt written notice to the Trustee, and notice to the
Holders in accordance with Section 13.2 hereof, of the appointment or
termination of any such agents and of the location and any change in the
location of any such office or agency.
If at any time the Company shall fail to maintain any such
required office or agency in The City of New York, or shall fail to furnish the
Trustee with the address thereof, presentations and surrenders may be made at,
and notices and demands may be served on, the Corporate Trust Office of the
Trustee.
SECTION 9.3. CORPORATE EXISTENCE.
Subject to Article 6 hereof, the Company will do or cause to
be done all things necessary to preserve and keep in full force and effect its
corporate existence, rights (charter and statutory) and franchises of the
Company; provided, however, that the Company shall not be required to preserve
any such right or franchise if the Board of Directors shall determine in good
faith that the preservation thereof is no longer desirable in the conduct of the
business of the Company and its Subsidiaries as a whole and that the loss
thereof is not disadvantageous in any material respect to the Holders.
SECTION 9.4. REPORTS.
(a) The Company, shall deliver to the Trustee within 15 days after it files them
with the Commission copies of the annual reports and of the information,
documents and other reports (or copies of such portions of any of the foregoing
as the Commission may by rules and regulations prescribe) which the Company is
required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act; provided, however, the Company shall not be required to deliver to
the Trustee any materials for which the Company has sought and received
confidential treatment by the SEC. The Company also shall comply with the other
provisions of Section 314(a) of the TIA.
SECTION 9.5. COMPLIANCE CERTIFICATE.
The Company shall deliver to the Trustee, within 90 days after
the end of each fiscal year of the Company, an Officers' Certificate stating
that in the course of the performance by the signers of their duties as Officers
of the Company, they would normally have knowledge of any failure by the Company
to comply with all conditions, or Default by the Company with respect to any
covenants, under this Indenture, and further stating whether or not they have
knowledge of any such failure or Default and, if so, specifying each such
56
failure or Default and the nature thereof. In the event an Officer of the
Company comes to have actual knowledge of a Default, regardless of the date, the
Company shall deliver an Officers' Certificate to the Trustee within five
Business Days of obtaining such actual knowledge specifying such Default and the
nature and status thereof.
SECTION 9.6. 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 owner
of Securities or holder or beneficial owner of 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 owner of Securities or holder or beneficial owner of shares of Common
Stock, or to a prospective purchaser of any such security designated by any such
holder, as the case may be, to the extent required to permit compliance by such
Holder or holder with Rule 144A under the Securities Act in connection with the
resale of any such security. "Rule 144A Information" shall be such information
as is specified pursuant to Rule 144A(d)(4) under the Securities Act. Whether a
Person is a beneficial owner shall be determined by the Company to the Company's
reasonable satisfaction.
ARTICLE 10
REDEMPTION OF SECURITIES
SECTION 10.1. OPTIONAL REDEMPTION.
(a) At any time after August 1, 2008, except for Securities
that it is required to purchase pursuant to Section 11.1 or required to convert
pursuant to Section 12.1, the Company may, at its option, redeem the Securities
in whole at any time or in part from time to time, on any date prior to the
Stated Maturity of such Securities, upon notice as set forth in Section 10.4, at
the Redemption Price (expressed in percentages of the principal amount) set
forth below if, but only if, redeemed on a Redemption Date occurring during the
12-month period beginning on August 1 of the years indicated:
During the Twelve Months Commencing Redemption Price
------------------------------------------------ ----------------
2008............................................. 103.000%
2009............................................. 102.000%
2010............................................. 101.000%
2011 and thereafter.............................. 100.000%
(b) If the Company exercises its option to redeem the
Securities pursuant to this Section 10.1, a Holder may nevertheless exercise its
right to have its Securities purchased pursuant to Section 11.1, if applicable,
and to convert such Securities pursuant to Article 12, in each case, until the
close of business two Business Days immediately preceding the Redemption Date.
57
(c) The Company shall pay any Interest to the Holder of the
Securities called for redemption (including those Securities which are converted
into Common Stock after the date the notice of the redemption is mailed and
prior to the Redemption Date) accrued but not paid to, but excluding, the
Redemption Date pursuant to Section 1 of the Global Security; provided, however,
that if the Redemption Date is an Interest Payment Date, the Company shall pay
the Interest to the Holder of the Security at the close of business on such
Interest Payment Date.
SECTION 10.2. NOTICE TO TRUSTEE.
If the Company elects to redeem Securities pursuant to the
provisions of Section 10.1 hereof (such election to be ordered by a Board
Resolution), it shall notify the Trustee at least 45 days prior to the intended
Redemption Date (unless a shorter notice shall be satisfactory to the Trustee)
of (i) such intended Redemption Date, (ii) the principal amount of Securities to
be redeemed and (iii) the CUSIP numbers of the Securities to be redeemed.
SECTION 10.3. SELECTION OF SECURITIES TO BE REDEEMED.
If fewer than all the Securities are to be redeemed, the
Trustee shall select the particular Securities to be redeemed from the
Outstanding Securities by a method that complies with the requirements of any
exchange on which the Securities are listed, or, if the Securities are not
listed on an exchange, on a pro rata basis or by lot or in accordance with any
other method the Trustee considers fair and appropriate. The Trustee may select
for redemption portions of the principal amount of Securities that have
denominations larger than $1,000.
Securities and portions thereof that the Trustee selects shall
be in principal amounts in integral multiples of $1,000. Provisions of this
Indenture that apply to Securities called for redemption also apply to portions
of Securities called for redemption. The Trustee shall notify the Company
promptly of the Securities or portions of Securities to be redeemed.
The Trustee shall promptly notify the Company and the
Registrar in writing of the Securities selected for redemption and, in the case
of any Securities selected for partial redemption, the principal amount thereof
to be redeemed.
If any Security selected for partial redemption is converted
or elected to be purchased in part before termination of the conversion right or
purchase right with respect to the portion of the Security so selected, the
converted or purchased portion of such Security shall be deemed to be the
portion selected for redemption; provided, however, that the Holder of such
Security so converted or purchased 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 or purchase
of such Security subject to Section 1 of the Global Security. Securities which
58
have been converted or purchased during a selection of Securities to be redeemed
may be treated by the Trustee as outstanding for the purpose of such selection.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
SECTION 10.4. NOTICE OF REDEMPTION.
Notice of redemption shall be given in the manner provided in
Section 13.2 to the Holders of Securities to be redeemed. Such notice shall be
given not less than 30 nor more than 60 days prior to the intended Redemption
Date.
All notices of redemption shall state:
(1) such intended Redemption Date;
(2) the Redemption Price and Interest accrued and unpaid to,
but excluding, the Redemption Date, if any;
(3) if fewer than all the Outstanding Securities are to be
redeemed, the principal amount of Securities to be redeemed and the principal
amount of Securities which will be outstanding after such partial redemption;
(4) that on the Redemption Date the Redemption Price and
Interest accrued and unpaid to, but excluding, the Redemption Date, if any, will
become due and payable upon each such Security to be redeemed;
(5) the Conversion Price, the date on which the right to
convert the principal of the Securities to be redeemed will terminate and the
places where such Securities may be surrendered for conversion;
(6) the place or places where such Securities are to be
surrendered for payment of the Redemption Price and accrued and unpaid Interest,
and
(7) the CUSIP number of the Securities.
The notice given shall specify the last date on which
exchanges or transfers of Securities may be made pursuant to Section 2.6, and
shall specify the serial numbers of Securities and the portions thereof called
for redemption.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
written request delivered at least 20 days prior to the date of the mailing of
such Notice (unless a shorter period shall be acceptable to the Trustee), by the
Trustee in the name of and at the expense of the Company.
59
SECTION 10.5. EFFECT OF NOTICE OF REDEMPTION.
Notice of redemption having been given as provided in Section
10.4 hereof, the Securities so to be redeemed shall, on the Redemption Date,
become due and payable at the Redemption Price therein specified and from and
after such date (unless the Company shall default in the payment of the
Redemption Price and accrued and unpaid Interest) such Securities shall cease to
bear Interest. Upon surrender of any such Security for redemption in accordance
with such notice, such Security shall be paid by the Company at the Redemption
Price; provided, however, the installments of Interest on Securities whose
Stated Maturity is prior to or on the Redemption Date shall be payable to the
Holders of such Securities, registered as such on the relevant Regular Record
Date.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal and premium, if any, shall,
until paid, bear Interest from the Redemption Date at the Interest Rate.
SECTION 10.6. DEPOSIT AND PAYMENT OF REDEMPTION PRICE.
Prior to or on any Redemption Date, the Company shall deposit
with the Trustee or with a 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 2.4) an amount of money in immediately
available funds sufficient to pay the Redemption Price, and accrued and unpaid
Interest in respect of all the Securities to be redeemed on that Redemption Date
from the last Interest Payment Date to but not including the Redemption Date,
other than any Securities called for redemption on that date which have been
converted prior to the date of such deposit, and accrued and unpaid Interest on
such Securities. The Trustee and Paying Agent shall then cause such funds to be
paid to the Holders of the Securities being redeemed in accordance with this
Article.
If any Security delivered for redemption shall not be so
redeemed by payment to the Holders thereof on the Redemption Date, the principal
amount of such Security shall, until it is redeemed, bear Interest on the
Redemption Date to but not including the actual date of redemption at the
Interest Rate, and each such Security shall remain convertible into shares of
Common Stock pursuant to Article 12 until such Security shall have been so
redeemed.
If any Security called for redemption is converted, any money
deposited with the Trustee or with a Paying Agent or so segregated and held in
trust for the redemption of such Security shall be paid to the Company upon
request by the Company or, if then held by the Company, shall be discharged from
such trust.
SECTION 10.7. SECURITIES REDEEMED IN PART.
Any Security which is to be redeemed only in part shall be
surrendered at an office or agency of the Company designated for that purpose
pursuant to Section 9.2 hereof (with, if the Company or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
60
the Company and the Trustee duly executed by, the Holder thereof or the Holder's
attorney duly authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Security without
service charge, a new Security or Securities of any authorized denomination as
requested by such Holder in principal amount equal to and in exchange for the
unredeemed portion of the Security so surrendered.
ARTICLE 11
PURCHASE AT THE OPTION OF A HOLDER UPON SPECIFIC
REPURCHASE DATES OR A CHANGE OF CONTROL
SECTION 11.1. PURCHASE RIGHT.
(a) On August 1 of 2008, 2013 and 2018, (each, a "SPECIFIC
REPURCHASE DATE"), each Holder shall have the right (the "PURCHASE RIGHT"), at
the Holder's option, to require the Company to repurchase for cash, and upon the
exercise of such right the Company shall purchase, all of such Holder's
Securities not theretofore called for redemption, or any portion of the
principal amount thereof that is equal to $1,000 or an integral multiple thereof
as directed by such Holder pursuant to Section 11.3 (provided that no single
Security may be purchased in part unless the portion of the principal amount of
such Security to be outstanding after such purchase is equal to $1,000 or an
integral multiple thereof), at a purchase price equal to 100% of the principal
amount of the Securities to be purchased (the "REPURCHASE PRICE"), plus accrued
and unpaid Interest on those Securities to, but excluding the Specific
Repurchase Date. Holders may submit their Securities for repurchase to the
Paying Agent at any time from the opening of business on the date that is 20
Business Days prior to the applicable Specific Repurchase Date until the close
of business on the Specific Repurchase Date.
(b) In the event that a Change in Control (together with the
specific Repurchase Dates, the "REPURCHASE EVENTS") shall occur, each Holder
shall have the Purchase Right, at the Holder's option, but subject to the
provisions of Section 11.2 hereof, to require the Company to purchase, and upon
the exercise of such right the Company shall purchase, all of such Holder's
Securities not theretofore called for redemption, or any portion of the
principal amount thereof that is equal to $1,000 or an integral multiple thereof
as directed by such Holder pursuant to Section 11.3 (provided that no single
Security may be purchased in part unless the portion of the principal amount of
such Security to be outstanding after such purchase is equal to $1,000 or an
integral multiple thereof), on the date (the "CHANGE OF CONTROL PURCHASE Date"
together with the Specific Repurchase Date, the "REPURCHASE DATE") that is a
Business Day no earlier than 20 days nor later than 60 days after the date of
the Repurchase Election Form (as defined below) at a purchase price equal to the
Repurchase Price, plus accrued and unpaid Interest to, but excluding, the Change
of Control Purchase Date; provided, however, that (i) installments of Interest
on Securities whose Stated Maturity is prior to or on the Change of Control
Purchase Date shall be payable to the Holders of such Securities, registered as
such on the relevant Regular Record Date according to their terms and the
61
provisions of Section 1 of the Form of Global Security attached hereto at
Exhibit A. If the Holders have a Repurchase Right pursuant to this Section
11.2(b), the Company shall issue a press release through Dow Xxxxx & Company,
Inc. or Bloomberg Business News containing the relevant information and make
such information available on the Company's website or through another public
medium as the Company may use at such time.
SECTION 11.2. REPURCHASE EVENT NOTICE.
No later than 20 Business Days after the occurrence of a
Repurchase Event, the Company shall mail a written notice of the Repurchase
Event (the "REPURCHASE EVENT NOTICE") by first class mail to the Trustee and to
each Holder (and to beneficial owners as required by applicable law) pursuant to
Section 13.2. The Repurchase Event Notice shall include a form of notice (the
"REPURCHASE ELECTION FORM") to be completed by the Holder and delivered to the
Paying Agent pursuant to Section 11.3, and shall state the following:
(1) that it is a Repurchase Event Notice pursuant to this
Section;
(2) the events causing a Repurchase Event and the date of such
Repurchase Event;
(3) the procedures with which such Holder must comply to
exercise its right to have its Securities purchased pursuant to Section 11.1,
including the date by which the completed Repurchase Election Form pursuant to
Section 11.3 and the Securities the Holder elects to have purchased pursuant to
Section 11.1 must be delivered to the Paying Agent in order to have such
Securities purchased by the Company pursuant to Section 11.1, the name and
address of the Paying Agent and that the Securities as to which a Repurchase
Election Form has been given may be converted, if they are otherwise convertible
pursuant to Article 12, only if the completed and delivered Repurchase Election
Form has been withdrawn in accordance with the terms of the Indenture, the
Holder's conversion rights pursuant to Article 12 and the Conversion Rate then
in effect and any adjustments thereto;
(4) the Repurchase Date and the Repurchase Price;
(5) that, unless the Company defaults in making payment of
such Repurchase Price, Interest on the Securities surrendered for purchase by
the Company will cease to accrue on and after the Repurchase Date; and
(6) the CUSIP number of the Securities.
No failure by the Company to give the foregoing Repurchase
Election Form shall limit any Holder's right to exercise its rights pursuant to
Section 11.1 or affect the validity of the proceedings for the purchase of its
Securities hereunder.
62
SECTION 11.3. DELIVERY OF REPURCHASE ELECTION FORM; FORM OF
REPURCHASE ELECTION FORM; WITHDRAWAL OF REPURCHASE ELECTION FORM.
(a) The Company shall deliver, or cause the Trustee or Paying
Agent, to deliver, to all Holders (and beneficial holders of the Securities) a
Repurchase Election Form substantially in the form of Exhibit D hereto, which
with respect to Holders purchase rights set forth in Section 11.1(a) or Section
11.1(b) and , shall be delivered to such Holders at least 20 Business Days prior
to the Repurchase Event Purchase Date and, as set forth in Section 11.2, shall
be included in the Repurchase Election Form; provided that the delivery of such
form of Repurchase Election Form to the Holders shall be made in the Company's
name and at the Company's expense and the text of such form of Repurchase
Election Form shall be prepared by the Company pursuant to clause (b) of this
Section.
(b) The form of Repurchase Election Form shall provide
instructions regarding procedures with which holders must comply to exercise
their rights pursuant to Section 11.1 and the completion of the Repurchase
Election Form and also shall state:
(1) that it is the Repurchase Election Form pursuant to
Sections 11.2 and 11.3 of the Indenture and must be completed by the Holder and
delivered to the Paying Agent (and any beneficial holder of securities),
together with the delivery of the holder's Securities for which the holder will
exercise its purchase rights pursuant to Section 11.1, for such holder to
receive the Repurchase Price;
(2) the name and address of the Paying Agent to, and the date
by, which the completed Repurchase Election Form and Securities must be
delivered in order for the holder to receive the applicable purchase price;
(3) the portion of the principal amount of the Security which
the Holder will deliver to be purchased, which portion must be in Principal
Amounts of $1,000 or an integral multiple thereof;
(4) any other procedures then applicable that the Holder must
follow to exercise rights under Article 11 and a brief description of those
rights;
(5) the Repurchase Date and the Repurchase Price;
(6) the procedures with which such Holder must comply to
exercise its right to have its Securities purchased pursuant to Section 11.1,
including the date by which the completed Repurchase Election Form pursuant to
Section 11.3 and the Securities the Holder elects to have purchased pursuant to
Section 11.1 must be delivered to Paying Agent in order to have such Securities
purchased by the Company pursuant to Section 11.1, the name and address of the
Paying Agent and that the Securities as to which a Repurchase Election Form has
been given may be converted, if they are otherwise convertible pursuant to
Article 12, only if the completed and delivered Repurchase Election Form has
been withdrawn in accordance with the terms of the Indenture, the Holder's
63
conversion rights pursuant to Article 12, the Conversion Rate then in effect and
any adjustments thereto;
(7) the Holder's right to withdraw a completed and delivered
Repurchase Election Form, the procedures for withdrawing a Repurchase Election
Form, pursuant to clause (c) below and that Securities as to which a completed
and delivered Repurchase Election Form may be converted, if they are convertible
only in accordance with Article 12, if the applicable completed and delivered
Repurchase Election Form has been withdrawn;
(8) that, unless the Company defaults in making payment on
Securities for which a Repurchase Election Form has been submitted, Interest on
such Securities will cease to accrue on the Repurchase Date; and
(9) the CUSIP number of the Securities.
(c) Notwithstanding anything herein to the contrary, any
Holder which has delivered a completed Repurchase Election Form to the Paying
Agent shall have the right to withdraw such Repurchase Election Form by delivery
of a written notice of withdrawal delivered to the office of the Paying Agent in
accordance with the Repurchase Election Form at any time prior to the close of
business on the day immediately preceding the Repurchase Date specifying:
(1) the certificate number, if any, of the Security in respect
of which such notice of withdrawal is being submitted;
(2) the principal amount of the Security with respect to which
such notice of withdrawal is being submitted; and
(3) the principal amount, if any, of such Security which
remains subject to the original Repurchase Election Form and which has been or
will be delivered for purchase by the Company.
The Paying Agent shall promptly notify the Company of the
receipt by it of any Repurchase Election Form or written notice of withdrawal
thereof.
SECTION 11.4. EXERCISE OF PURCHASE RIGHTS.
To exercise a purchase right pursuant to Section 11.1, a
Holder must deliver to the Trustee at its offices on or prior to the close of
business on the Business Day prior to the Repurchase Date the following:
(a) a completed Repurchase Election Form; and
(b) the Securities or cause such Securities to be delivered
through the facilities of the Depositary, as applicable, with respect to which
the purchase right is being exercised, with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer, in form
64
satisfactory to the Company and the Trustee duly executed by, the Holder thereof
or such Holder's attorney duly authorized in writing.
SECTION 11.5. DEPOSIT AND PAYMENT OF THE PURCHASE PRICE.
(a) If a Holder has exercised its rights pursuant to Section
11.1 and has satisfied the conditions for the exercise of such rights in
accordance with Section 11.4, then the Company shall, prior to 10:00 a.m. (New
York City time) on the Business Day following the Repurchase Date 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 2.4) an amount of money in immediately
available funds, if deposited on such Business Day sufficient to pay the
aggregate Repurchase Price of all the Securities or portions thereof which are
to be purchased on such purchase date, and the Trustee or Paying Agent, as
applicable shall pay the Holder the Repurchase Price, as applicable, multiplied
by the principal amount of Securities for which such rights were exercised and
not withdrawn on or prior to the Purchase Date.
(b) There shall be no purchase of any Securities pursuant to
Section 11.1 if there has occurred (prior to, on or after, as applicable, the
giving, by the Holders of such Securities, of the required Repurchase Election
Form) and is continuing an Event of Default (other than a default in the payment
of the Repurchase Price with respect to such Securities). The Paying Agent will
promptly return to the respective Holders thereof any Securities (x) with
respect to which a Repurchase Election Form 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 Repurchase Price with
respect to such Securities) in which case, upon such return, the Repurchase
Election Form with respect thereto shall be deemed to have been withdrawn.
(c) If any Security delivered for purchase pursuant to Section
11.1 shall not be so paid on the Repurchase Date, the principal amount of such
Security shall, until it is paid, bear Interest from the purchase date to but
not including the date of actual payment hereunder at the Interest Rate, and
each such Security shall remain convertible into shares of Common Stock pursuant
to Article 12 until such Security shall have been paid.
SECTION 11.6. EFFECT OF DELIVERY OF CHANGE OF CONTROL PURCHASE
NOTICE AND PURCHASE.
(a) Upon receipt by the Paying Agent of a Repurchase Election
Form, the Holder of the Security in respect of which such Repurchase Election
Form was delivered shall (unless such Repurchase Election Form is withdrawn
pursuant to Section 11.3(c)) thereafter be entitled to receive solely the
Repurchase Price with respect to such Security, and, if applicable, any accrued
and unpaid Interest. Securities in respect of which a Repurchase Election Form
has been delivered by the Holder thereof may not be converted pursuant to
Article 12 on or after the date of the delivery of such Repurchase Election Form
65
unless such Repurchase Election Form which has been completed and delivered to
the Paying Agent has first been validly withdrawn pursuant to Section 11.3(c).
(b) All Securities delivered for purchase shall be canceled by
the Trustee or Paying Agent, as applicable.
SECTION 11.7. CERTIFICATED SECURITIES PURCHASED IN PART.
Any Certificated Security which is to be purchased only in
part shall be surrendered at the office of the Paying Agent (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or such Holder's attorney duly authorized in writing) and
the Company shall execute and the Trustee shall authenticate and deliver to the
Holder of such Security, without service charge, a new Security or Securities,
of any authorized denomination as requested by such Holder in principal amount
equal to, and in exchange for, the portion of the principal amount of the
Security so surrendered which is not purchased.
SECTION 11.8. COVENANT TO COMPLY WITH SECURITIES LAWS UPON
PURCHASE OF SECURITIES.
When complying with the provisions of this Article 11
(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 (a) comply with Rule 13e-4 and Rule 14e-1 under the
Exchange Act, (b) file the related Schedule TO (or any successor schedule, form
or report) under the Exchange Act and (c) otherwise comply with all federal and
state securities laws so as to permit the rights and obligations under this
Article 11 to be exercised in the time and in the manner specified in this
Article 11.
SECTION 11.9. REPAYMENT TO THE COMPANY. The Trustee and the
Paying Agent shall return to the Company any cash that remains unclaimed,
together with interest or dividends, if any, thereon (subject to the provisions
of Sections 2.3 and 5.4), held by them for the payment of the Repurchase Price;
provided, however, that to the extent that the aggregate amount of cash
deposited by the Company pursuant to Section 11.5 exceeds the aggregate
Repurchase Price of the Securities or portions thereof which the Company is
obligated to purchase on the Purchase Date then, unless otherwise agreed in
writing with the Company, promptly after the Business Day following such
Purchase Date, the Trustee or Paying Agent, as applicable, shall return any such
excess to the Company together with interest or dividends, if any, thereon,
subject to the provisions of Section 5.4.
ARTICLE 12
CONVERSION OF SECURITIES
66
SECTION 12.1. CONVERSION RIGHT; CONVERSION PRICE.
(a) Subject to and upon compliance with the provisions of this
Article, at the option of the Holder at any time and from time to time, any
Security or any portion of the principal amount thereof which is 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; provided that such right of conversion may
only be exercised under the following circumstances:
(i) during any Conversion Period, if the Market Price of
the Common Stock for at least 20 Trading Days in the 30 consecutive
Trading Day period ending on the last day of the preceding Fiscal
Quarter was more than 110% of the Conversion Price in effect on such
30th Trading Day;
(ii) on or before August 15, 2018, during the five
Business Day period following any 10 consecutive Trading Day period
in which the average Market Price of the Securities for such 10
Trading Day period was less than 98% of the average Conversion Value
of the Securities during the same 10 Trading Day period;
(iii) at any time prior to the close of business on the
day that is one Business Day immediately preceding a Redemption
Date, if such Security has been called for redemption pursuant to
Article 10 hereof; or
(iv) as provided in Section 12.1(b).
The Conversion Agent shall, on behalf of the Company, determine on a daily basis
whether the Securities shall be convertible as a result of the occurrence of an
event specified in clause (i) or clause (ii) above and, if the Securities shall
be so convertible, the Conversion Agent shall promptly deliver to the Company
and the Trustee written notice thereof whenever the Securities shall become
convertible pursuant to Section 12.1 and the Company or, at the Company's
request, the Trustee in the name and at the expense of the Company, shall notify
the Holders of the event triggering such convertibility in the manner provided
in Section 13.2, and the Company shall also publicly announce such information
and publish it on the Company's web site. Any notice so given shall be
conclusively presumed to have been duly given, whether or not the Holder
receives such notice.
(b) In addition, in the event that:
(i) (A) the Company distributes to all or substantially
all holders of shares of Common Stock rights or warrants entitling
them (for a period expiring within 60 days of the date for such
distribution) to subscribe for or purchase shares of Common Stock,
at a price per share less than the Market Price of the Common Stock
at the time of the announcement of such distribution, (B) the
67
Company distributes to all or substantially all holders of shares of
Common Stock cash or other assets, debt securities or rights or
warrants to purchase the Company's securities, where the Fair Market
Value (as determined by the Board of Directors) of such distribution
per share of Common Stock exceeds 5% of the Market Price of a share
of Common Stock on the Business Day immediately preceding the date
of declaration of such distribution or (C) an event that would
constitute a Change of Control occurs but for the provisions of the
provision to the definition of "Change of Control", then, in each
case, the Securities may be surrendered for conversion at any time
on and after the date that the Company gives notice to the Holders
of such right, which shall be not less than 20 days prior to the
Ex-Dividend Time for such distribution, in the case of clause (A) or
(B), or within 20 Business Days after the occurrence of the event
that would constitute a change of control, in the case of clause
(C), until (1) the earlier of the close of business on the Business
Day immediately preceding the Ex-Dividend Time or the date the
Company announces that such distribution will not take place, in the
case of clause (A) or (B), or (2) the earlier of 20 Business Days
after the Company's delivery of the Repurchase Event Notice or the
date the Company announces that the event that would constitute a
change of control will not take place, in the case of clause (C); or
(ii) the Company consolidates with or merges into
another Person, or is a party to a binding share exchange pursuant
to which the shares of Common Stock would be converted into cash,
securities or other property as set forth in Section 12.5 hereof,
then the Securities may be surrendered for conversion at any time
from and after the date which is 15 days prior to the date announced
by the Company as the anticipated effective time of such transaction
until 15 days after the actual date of such transaction, provided,
however, that at the effective time of a transaction described in
the immediately preceding clause, the right to convert a Security
into Common Stock will be changed into a right to convert a Security
into the kind and amount of cash, securities or other property which
a Holder would have received if such Holder had converted such
Security immediately prior to such transaction.
"CONVERSION PERIOD" means the period from and including the
thirtieth Trading Day in a Fiscal Quarter to, but not including, the thirtieth
Trading Day in the immediately following Fiscal Quarter.
"CONVERSION VALUE", on any day, means the product of the
Market Price for the Common Stock as of such day multiplied by the then-current
Conversion Rate.
"EX-DIVIDEND TIME" means, with respect to any issuance or
distribution on shares of Common Stock, the first date on which the shares of
Common Stock trade regular way on the principal securities market on which the
shares of Common Stock are then traded without the right to receive such
issuance or distribution.
68
The "CONVERSION RATE", at any time, shall equal (A) $1,000
divided by the Conversion Price at such time, rounded to three decimal places
(rounded up if the fourth decimal place thereof is 5 or more and otherwise
rounded down).
(c) The price at which shares of Common Stock shall be
delivered upon conversion (the "CONVERSION PRICE") shall be initially equal to
$8.375 per share of Common Stock, subject to adjustment, in certain instances,
as provided in Section 12.4.
(d) No payment or adjustment will be made for dividends on, or
other distributions with respect to, any Common Stock except as provided in this
Article 12.
SECTION 12.2. EXERCISE OF CONVERSION RIGHT
(a) To exercise the conversion right with respect to a
Certificated Security, a Holder must (1) deliver a completed conversion notice,
the form of which is provided in Exhibit D, to the Depositary stating that the
Holder elects to convert such Certificated Security or, if less than the entire
principal amount thereof is to be converted, the portion thereof to be
converted, (2) deliver duly signed completed conversion notice and the
Certificated Security duly endorsed or assigned to the Company or in blank, at
the office of any Conversion Agent, (3) pay all Interest to which the Holder is
not entitled, if any, pursuant to Section 1 of the Global Security, and (4) pay
any transfer taxes or other applicable taxes or duties, if required.
(b) To convert interests in a Global Security, a Holder must
deliver to DTC the appropriate instruction form for conversion pursuant to DTC's
conversion program.
(c) To the extent provided in Section 1 of the Global
Security, Securities surrendered for conversion during the period from the close
of business on any Regular Record Date to the opening of business on the next
succeeding Interest Payment Date (except in the case of any Security whose
Stated Maturity is prior to such Interest Payment Date) shall be accompanied by
payment by such Holder in immediately available funds to the Company of an
amount equal to the Interest to be received on such Interest Payment Date on the
principal amount of Securities being surrendered for conversion. To the extent
provided in Section 1 of the Global Security, Securities which have been called
for redemption by the Company in a notice of redemption pursuant to Section
10.4, and are converted prior to redemption, shall not require such concurrent
payment to the Company, and if converted during time period set forth in the
preceding sentence, the Holders of such converted Securities shall be entitled
to receive (and retain) any accrued interest on the principal amount of such
surrendered Securities, if any.
(d) Securities shall be deemed to have been converted
immediately prior to the close of business on the day of surrender of such
Securities for conversion in accordance with the foregoing provisions, and at
such time the rights of the Holders of such Securities as Holders shall cease,
and the Person or Persons entitled to receive the shares of Common Stock
69
issuable upon conversion shall be treated for all purposes as the record holder
or holders of such shares of Common Stock at such time.
(e) In the case of any Security which is converted in part
only, or if a Holder converts less than the principal amount it owns at such
time, upon such conversion the Company shall execute and the Trustee shall
authenticate and deliver to the Holder thereof, at the expense of the Company, a
new Security or Securities of authorized denominations in principal amount equal
to the unconverted portion of the principal amount of such Securities.
(f) As promptly as practicable on or after the Conversion
Date, the Company shall cause to be issued and delivered to the Conversion Agent
a certificate or certificates for the number of full shares of Common Stock
issuable upon conversion of such Securities, together with payment in lieu of
any fraction of a share as provided in Section 12.3 hereof.
(g) A Security in respect of which a Holder has delivered a
Repurchase Election Form exercising the option of such Holder to require the
Company to purchase such Security may be converted only if such notice of
exercise is withdrawn in accordance with Section 11.3(c).
SECTION 12.3. FRACTIONS OF SHARES.
No fractional shares of Common Stock shall be issued upon
conversion of any Security or Securities. If more than one Security shall be
surrendered for conversion at one time by the same Holder, the number of full
shares of Common Stock which shall be issued upon conversion thereof shall be
computed on the basis of the aggregate principal amount of the Securities (or
specified portions thereof) so surrendered. Instead of any fractional shares of
Common Stock which would otherwise be issued upon conversion of any Security or
Securities (or specified portions thereof), the Company shall pay a cash
adjustment in respect of such fraction (calculated to the nearest one-100th of a
share) in an amount equal to the same fraction of the Market Price of the shares
of Common Stock as of the Trading Day preceding the Conversion Date.
SECTION 12.4. ADJUSTMENT OF CONVERSION PRICE.
The Conversion Price shall be subject to adjustment,
calculated in good faith by the Company, from time to time as follows:
(a) In case the Company shall hereafter pay a dividend or make
a distribution to all holders of the outstanding Common Stock in shares of
Common Stock, the Conversion Price in effect at the opening of business on the
date following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be reduced by multiplying such
Conversion Price by a fraction:
70
(1) the numerator of which shall be the number of
shares of Common Stock outstanding at the close of business on the
Conversion Record Date 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.
Such reduction shall become effective immediately after the
opening of business on the day following the Conversion Record Date. If any
dividend or distribution of the type described in this Section 12.4(a) is
declared but not so paid or made, the Conversion Price shall again be adjusted
to the Conversion Price which would then be in effect if such dividend or
distribution had not been declared.
(b) In case the 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 applicable, 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 12.4(d)) to all or
substantially all holders of its outstanding shares of Common Stock entitling
them to subscribe for or purchase shares of Common Stock (or securities
convertible into shares of Common Stock) at a price per share (or having a
conversion price per share) less than the Current Market Price on the Conversion
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 Conversion Record Date 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
Conversion 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
Conversion Record Date, plus the total number of additional shares of
71
Common Stock so offered 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 Conversion 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 stockholders entitled to receive such rights or
warrants had not been fixed. In determining whether any rights or warrants
entitle the holders to subscribe for or purchase 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.
Notwithstanding the foregoing, in the event that the Company
shall make a distribution subject to this Section 12.4(c), the Company may, in
lieu of making any adjustment required pursuant to this Section 12.4(c), make
proper provision so that each Holder of a Security who converts such Security
(or a portion thereof) after the Conversion Record Date for such distribution
shall be entitled to receive upon such conversion, in addition to the shares of
Common Stock issuable upon such conversion, the securities such Holder would
have received had such Holder converted such Security (or portion thereof)
immediately prior to such Conversion Record Date.
(d) (i) In case the Company shall, by dividend or otherwise,
distribute to all or substantially all holders of its Common Stock shares of any
class of Capital Stock of the Company (other than any dividends or distributions
to which Section 12.4(a) applies) or evidences of its indebtedness, cash or
other assets, including securities, but excluding (1) any rights or warrants
referred to in Section 12.4(c), (2) dividends or distributions of stock,
securities or other property or assets (including cash) in connection with a
reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance to which Section 12.11 applies and (3) dividends
and distributions paid exclusively in cash (such Capital Stock, evidence of its
indebtedness, cash, other assets or securities being distributed hereinafter in
this Section 12.4(d) called the "DISTRIBUTED ASSETS"), then, in each such case,
subject to clause (ii) of this Section 12.4(d), the Conversion Price shall be
reduced so that the same shall be equal to the price determined by multiplying
the Conversion Price in effect immediately prior to the close of business on the
Conversion Record Date with respect to such distribution by a fraction:
72
(1) the numerator of which shall be the Current
Market Price on such date, less the Fair Market 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
distributed assets so distributed applicable to one share of Common
Stock (determined on the basis of the number of shares of Common Stock
outstanding on the Conversion 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 Conversion Record Date. However, in
the event that the then Fair Market Value (as so determined) of the portion of
the distributed assets so distributed applicable to one share of Common Stock is
equal to or greater than the Current Market Price on the Conversion Record Date,
in lieu of the foregoing adjustment, adequate provision shall be made so that
each Holder shall have the right to receive upon conversion of a Security (or
any portion thereof) the amount of distributed assets such Holder would have
received had such Holder converted such Security (or portion thereof)
immediately prior to such Conversion 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.
(ii) If the Board of Directors determines the Fair
Market Value of any distribution for purposes of this Section 12.4(d)
by reference to the actual or when issued trading market for any
distributed assets comprising all or part of such distribution, it must
in doing so consider the prices in such market over the same period
(the "REFERENCE PERIOD") used in computing the Current Market Price 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 Holders.
In the event any such distribution consists of shares of
capital stock of, or similar equity interests in, one or more of the Company's
Subsidiaries (a "Spin-Off"), the Fair Market Value of the securities to be
distributed shall equal the average of the closing sale prices of such
securities on the principal securities market on which such securities are
traded for the five consecutive Trading Days commencing on and including the
sixth day of trading of those securities after the effectiveness of the
Spin-Off, and the Current Market Price shall be measured for the same period. In
the event, however, that an underwritten initial public offering of the
securities in the Spin-Off occurs simultaneously with the Spin-Off, Fair Market
Value of the securities distributed in the Spin-Off shall mean the initial
public offering price of such securities and the Current Market Price shall mean
the Market Price for the Common Stock on the same Trading Day.
(iii) Rights or warrants distributed by the Company
to all holders of Common Stock entitling the holders thereof to
73
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 specified in such
rights or warrants or related instruments or agreements governing the
same (a "TRIGGER EVENT"):
(1) are deemed to be transferred with such shares of
Common Stock;
(2) are not exercisable; and
(3) are also issued in respect of future issuances of
Common Stock;
shall be deemed not to have been distributed for purposes of this Section
12.4(d) (and no adjustment to the Conversion Price under this Section 12.4(d)
will be required) until the occurrence of the earliest Trigger Event; provided
that (1) 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 distributed assets, evidences of indebtedness or other assets or
entitle the holder to purchase a different number or amount of the foregoing or
to purchase any of the foregoing at a different purchase price, then the
occurrence of each such event shall be deemed to be the date of issuance and the
Conversion 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); and (2) 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 12.4(d):
(1) in the case of any such rights or warrants which
shall all have been redeemed or purchased without exercise by any
holders thereof, the Conversion Price shall be readjusted upon such
final redemption or purchase to give effect to such distribution or
Trigger Event, as applicable, as though it were a cash distribution,
equal to the per share redemption or purchase price received by a
holder of Common Stock with respect to such rights or warrants
(assuming such holder had retained such rights or warrants), made to
all holders of Common Stock as of the date of such redemption or
purchase; and
(2) in the case of such rights or warrants which
shall have expired or been terminated without exercise, the Conversion
Price shall be readjusted as if such rights and warrants had never been
issued.
For purposes of this Section 12.4(d) and Sections 12.4(a),
12.4(b) and 12.4(c), any dividend or distribution to which this Section 12.4(d)
is applicable that also includes shares of Common Stock, a subdivision or
combination of Common Stock to which Section 12.4(b) applies, or rights or
74
warrants to subscribe for or purchase shares of Common Stock to which Section
12.4(c) applies (or any combination thereof), shall be deemed instead to be:
(A) 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 12.4(a), 12.4(b) and 12.4(c) apply, respectively (and
any Conversion Price reduction required by this Section 12.4(d) with respect to
such dividend or distribution shall then be made), immediately followed by
(B) 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 12.4(a), 12.4(b) and 12.4(c)
with respect to such dividend or distribution shall then be made), except:
(I) the Conversion 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",
"Conversion Record Date fixed for such determinations" and "Conversion Record
Date" within the meaning of Section 12.4(a), (y) "the day upon which such
subdivision becomes effective" and "the day upon which such combination becomes
effective" within the meaning of Section 12.4(b), and (z) as "the Conversion
Record Date fixed for the determination of stockholders entitled to receive such
rights or warrants", "the Conversion Record Date fixed for the determination of
the stockholders entitled to receive such rights or warrants" and such
"Conversion Record Date" within the meaning of Section 12.4(c); and
(II) any shares of Common Stock included in such dividend or
distribution shall not be deemed "outstanding at the close of business on the
Conversion Record Date fixed for such determination" within the meaning of
Section 12.4(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.
(e) In case the Company shall, by dividend or otherwise,
distribute to all or substantially all holders of its Common Stock cash
(excluding any dividend or distribution in connection with the liquidation,
dissolution or winding up of the Company, whether voluntary or involuntary),
then, in such case, the Conversion Price shall be reduced so that the same shall
equal the rate determined by multiplying the Conversion Rate in effect on the
applicable record date by a fraction,
(1) the numerator of which shall be the Current
Market Price on such record date less the full amount of cash
so distributed as applicable to one share of Common Stock; and
(2) the denominator of which shall be the
Current Market Price on such record date,
75
such adjustment to be effective immediately prior to the opening of business on
the day following the Conversion Record Date; provided that if the portion of
the cash so distributed applicable to one share of Common Stock is equal to or
greater than the Current Market Price on the Conversion 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 the amount of cash such holder
would have received had such Holder converted each Security on the Record Date.
If such dividend or distribution is not so paid or made, the Conversion Price
shall again be adjusted to be the Conversion Price that would then be in effect
if such dividend or distribution had not been declared.
(f) In case a tender or exchange offer made by the Company or
any Subsidiary for all or any portion of the Common Stock shall expire and such
tender or exchange offer (as amended upon the expiration thereof) shall require
the payment to stockholders of consideration per share of Common Stock 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 as of the last
time (the "EXPIRATION TIME") tenders or exchanges may be made pursuant to such
tender or exchange offer (as it may be amended) exceeds the Market Price of a
share of Common Stock on the Trading Day next succeeding the Expiration Time,
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 Expiration Time by a fraction,
(1) the numerator of which shall be the number
of shares of Common Stock outstanding (including any tendered
or exchanged shares) at the Expiration Time multiplied by the
Market Price of a share of Common Stock on the Trading Day
next succeeding the Expiration Time such adjustment to become
effective immediately prior to the opening of business on the
day following the Expiration Time; and
(2) the denominator of which 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 or exchange offer) of all shares validly tendered or
exchanged and not withdrawn as of the Expiration Time (the
shares deemed so accepted up to any such maximum, being
referred to as the "PURCHASED SHARES") and (y) the product of
the number of shares of Common Stock outstanding (less any
Purchased Shares) at the Expiration Time and the Market Price
of a share of Common Stock on the Trading Day next succeeding
the Expiration Time.
If the Company is obligated to purchase shares pursuant to any such
tender or exchange 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 that would
then be in effect if such tender or exchange offer had not been made.
76
(g) For purposes of this Section 12.4, the following terms
shall have the meanings indicated:
(1) "CURRENT MARKET PRICE" shall mean the average of
the daily Market Prices per share of Common Stock (or such other
security as specified herein) 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 12.4(a), (b), (c), (d), (e) or (f) occurs during
such ten consecutive Trading Days, the Market Price for each Trading
Day prior to the "ex" date for such other event shall be adjusted by
multiplying such Market Price by the same 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 12.4(a), (b),
(c), (d), (e) or (f) occurs on or after the "ex" date for the issuance
or distribution requiring such computation and prior to the day in
question, the Market Price for each Trading Day on and after the "ex"
date for such other event shall be adjusted by multiplying such Market
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 Market Price for each Trading Day on or after
such "ex" date shall be adjusted by adding thereto the amount of any
cash and the Fair Market Value (as determined by the Board of Directors
in a manner consistent with any determination of such value for
purposes of Section 12.4(d) or (f), whose determination shall be
conclusive and 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.
Notwithstanding the foregoing, for purposes of any computation
under Section 12.4(f), the Current Market Price of the Common Stock on any date
shall be deemed to be the average of the daily Market Prices per share of Common
Stock for such day and the next two succeeding Trading Days; provided, however,
that if the "ex" date for any event (other than the tender offer requiring such
computation) that requires an adjustment to the Conversion Price pursuant to
Section 12.4(a), (b), (c), (d), (e) or (f) occurs on or after the Expiration
Time for the tender or exchange offer requiring such computation and prior to
the day in question, the Market Price for each Trading Day on and after the "ex"
date for such other event shall be adjusted by multiplying such Market Price by
the reciprocal of the fraction by which the Conversion Price is so required to
77
be adjusted as a result of such other event. For purposes of this paragraph, the
term "ex" date, when used:
(I) 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 Market Price was obtained without the
right to receive such issuance or distribution;
(II) with respect to any subdivision or combination of shares
of Common Stock, means the first date on which the shares of Common Stock trade
regular way on such exchange or in such market after the time at which such
subdivision or combination becomes effective; and
(III) with respect to any tender or exchange offer, means the
first date on which the Common Stock trades regular way on such exchange or in
such market after the Expiration Time of such offer.
Notwithstanding the foregoing, whenever successive adjustments
to the Conversion Price are called for pursuant to this Section 12.4, such
adjustments shall be made to the Current Market Price as may be necessary or
appropriate to effectuate the intent of this Section 12.4 and to avoid unjust or
inequitable results as determined in good faith by the Board of Directors.
(1) "FAIR MARKET VALUE" shall mean, if there is a
current market for the asset, debt or transaction in question, the
amount that a willing buyer would pay a willing seller in an arm's
length transaction or, in the absence of a current market for such
asset, debt or transaction, the amount determined in good faith by the
Board of Directors that represents its determination of the fair market
value of the asset.
(2) "CONVERSION 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).
The Company may make such reductions in the Conversion Price,
in addition to those required by Sections 12.4(a), (b), (c), (d), (e) or (f), as
the Board of Directors considers to be advisable to avoid or diminish any income
tax to holders of Common Stock or rights to purchase Common Stock resulting from
any dividend or distribution of stock (or rights to acquire stock) or from any
event treated as such for income tax purposes or otherwise.
78
(h) No adjustment need be made for (i) a transaction referred
to in Sections 12.4 or 12.11 if Holders participate in the transaction without
conversion on a basis and with notice that the Board of Directors determines to
be fair and appropriate in light of the basis and notice on which holders of
shares of Common Stock participate in the transaction; (ii) the issuance and
distribution of rights to purchase shares of Common Stock pursuant to (A) a
Company plan for reinvestment of dividends or interest, (B) a change in the par
value or no par value of the shares of Common Stock or (C) to the extent the
Securities become convertible pursuant to this Article 12 in whole or in part
into cash, with respect to such cash after such cash is distributed to the
Holders in satisfaction of such conversion right.
(i) 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 Holders, 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 the Conversion Agent 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 12.4(j) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Article
12 shall be made by the Company in good faith and shall be made to the nearest
cent or to the nearest one hundredth of a share, as applicable. No adjustment
need be made for a change in the par value or no par value of the Common Stock.
(k) No adjustment in Conversion Price shall be required if the
Fair Market Value of any assets, debt securities or rights, warrants or options
to purchase the securities of the Company, including but not limited to Common
Stock, in each case applicable to each share of Common Stock are distributed to
the Company's stockholders and such Fair Market Value either equals or exceeds
the Current Market Price or such Current Market Price exceeds the such Fair
Market Price Value by an amount not exceeding $1.00; provided, however, in lieu
of an adjustment to the Conversion Price, adequate provision shall be made so
that each Holder shall have the right to receive upon conversion of a Security,
in addition to shares of Common Stock, the kind and amount of such distribution
such Holder would have received had such Holder converted such Security
immediately prior to the Conversion Record Date for determining the shareholders
entitled to receive the distribution.
79
(l) In any case in which this Section 12.4 provides that an
adjustment shall become effective immediately after a Conversion Record Date for
an event, the Company may defer until the occurrence of such event (i) issuing
to the Holder of any security converted after such Conversion Record Date and
before the occurrence of such event the additional shares of Common Stock
issuable upon such conversion by reason of the adjustment required by such event
over and above the Common Stock issuable upon such conversion before giving
effect to such adjustment and (ii) paying to such holder any amount in cash in
lieu of any fraction pursuant to Section 12.3.
(m) For purposes of this Section 12.4, the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock. The Company
will not pay any dividend or make any distribution on shares of Common Stock
held in the treasury of the Company.
(n) If the distribution date for the rights provided in the
Company's rights agreement, if any, occurs prior to the date a Security is
converted, the Holder of the Security who converts such Security 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 clause 12.4(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.
(o) 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 a subsidiary of the Company, then the Conversion Price shall be reduced
so that the same shall be equal to the price determined by multiplying the
Conversion Price in effect immediately prior to the close of business on the
Conversion Record Date with respect to such distribution by a fraction:
(1) the numerator of which shall be the Current
Market Price of the shares of Capital Stock of such subsidiary (as
determined by the Board of Directors, whose determination shall be
conclusive and set forth in a Board Resolution), measured from the date
of such distribution; and
(2) the denominator of which shall be the Current
Market Price of the Company's common stock, measured from the date of
such distribution.
SECTION 12.5. 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 12.4(i) for which the notice required by such paragraph has been
provided), the Company shall promptly file with the Trustee and any Conversion
80
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 pursuant to Section 13.2 within 20 days prior to the
effective date of such adjustment. Failure to deliver such notice shall not
affect the legality or validity of any such adjustment.
SECTION 12.6. NOTICE PRIOR TO CERTAIN ACTIONS.
In case at any time after the date hereof:
(1) the Company shall declare a dividend (or any
other distribution) on its Common Stock payable otherwise than in cash
out of its capital surplus or 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 securities pursuant to Section 9.2, and shall cause to
be provided to the Trustee and all Holders in accordance with Section 13.2, 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 shares of Common Stock of record to
be entitled to such dividend, distribution, rights or warrants are to be
determined; or
81
(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 shares 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 12.6.
SECTION 12.7. COMPANY TO RESERVE COMMON STOCK.
The Company shall at all times reserve and keep available,
free from preemptive rights, out of its authorized but unissued Common Stock,
for the purpose of effecting the conversion of the Securities, the full number
of shares of fully paid and nonassessable Common Stock then issuable upon the
conversion of all Outstanding Securities.
SECTION 12.8. COMMON STOCK TO BE FULLY PAID AND NONASSESSABLE.
The Company covenants that all Common Stock which may be
issued upon conversion of Securities will upon issue be fully paid and
nonassessable and, except as provided in Section 12.9, the Company will pay all
taxes, liens and charges with respect to the issue thereof.
SECTION 12.9. TAXES ON CONVERSIONS.
Except as provided in the next sentence, the Company will pay
any and all taxes (other than taxes on income) and duties that may be payable in
respect of the issue or delivery of shares of Common Stock on conversion of
Securities pursuant to Article 12. A Holder delivering a Security for conversion
shall be liable for and will be required to pay any tax or duty which may be
payable in respect of any transfer involved in the issue and delivery of shares
of Common Stock in a name other than that of the Holder of the Security or
Securities to be converted, and no such issue or delivery shall be made unless
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 12.10. CANCELLATION OF CONVERTED SECURITIES.
All Securities delivered for conversion shall be delivered to
the Trustee to be canceled by or at the direction of the Trustee.
82
SECTION 12.11. EFFECT OF RECLASSIFICATION, CONSOLIDATION,
MERGER OR SALE.
If any of following events occur:
(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), as a result of which holders
of Common Stock shall be entitled to receive Capital Stock, securities
or other property or assets (including cash) with respect to or in
exchange for such Common Stock;
(2) any merger, consolidation, statutory share
exchange or combination of the Company with another Person as a result
of which holders of Common Stock shall be entitled to receive stock,
securities or other property or assets (including cash) with respect to
or in exchange for such Common Stock; or
(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) with respect to or in exchange for such Common Stock,
then (A) the Company or the successor or purchasing Person, as applicable, shall
execute with the Trustee a supplemental indenture (which shall comply with this
Indenture and 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 security shall be convertible into the kind and amount of
shares of Capital Stock and other securities or property or assets (including
cash) which such Holder would have been entitled to receive upon such
reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance had such Securities 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 merger,
consolidation, statutory share exchange, sale or conveyance (provided that, if
the kind or amount of securities, cash or other property receivable upon such
merger, consolidation, statutory share exchange, sale or conveyance is not the
same for each share of Common Stock in respect of which such rights of election
shall not have been exercised ("NON-ELECTING SHARE"), then for the purposes of
this Section 12.11 the kind and amount of securities, cash or other property
receivable upon such merger, consolidation, statutory share exchange, 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
12. If, in the case of any such reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or conveyance, the stock or other
83
securities and assets receivable thereupon by a holder of Common Stock includes
shares of stock or other securities and assets of a corporation other than the
successor or purchasing Person, as applicable, 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 as the Board of Directors shall reasonably consider
necessary by reason of the foregoing, including to the extent practicable the
provisions providing for the Purchase rights set forth in Article 11.
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 shall apply to successive
or series of related reclassifications, mergers, consolidations, statutory share
exchanges, combinations, sales and conveyances.
If this Section 12.11 applies to any event or occurrence,
Section 12.4 shall not apply.
SECTION 12.12. RESPONSIBILITY OF TRUSTEE FOR CONVERSION
PROVISIONS.
The Trustee, subject to the provisions of Section 5.1, and any
Conversion Agent shall not at any time be under any duty or responsibility to
any Holder of Securities to determine whether any facts exist which may require
any adjustment of the Conversion Price, or with respect to the nature or intent
of any such adjustments when made, or with respect to the method employed, or
herein or in any supplemental indenture provided to be employed, in making the
same. Neither the Trustee, subject to the provisions of Section 5.1, nor any
Conversion Agent shall be accountable with respect to the validity or value (of
the kind or amount) of any Common Stock or of any other securities or property,
which may at any time be issued or delivered upon the conversion of any
Security; and it or they do not make any representation with respect thereto.
Neither the Trustee, subject to the provisions of Section 5.1, nor any
Conversion Agent shall 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 Security
for the purpose of conversion; and the Trustee, subject to the provisions of
Section 5.1, and any Conversion Agent shall not be responsible or liable for any
failure of the Company to comply with any of the covenants of the Company
contained in this Article.
ARTICLE 13
OTHER PROVISIONS OF GENERAL APPLICATION
84
SECTION 13.1. TRUST INDENTURE ACT CONTROLS.
This Indenture is subject to the provisions of the TIA which
are required to be part of this Indenture, and shall, to the extent applicable,
be governed by such provisions.
SECTION 13.2. NOTICES.
Any notice or communication to the Company or the Trustee is
duly given if in writing (which may be by facsimile with the original to follow)
and delivered in person or mailed by first-class mail to the address set forth
below:
(a) if to the Company:
Alloy, Inc.
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Chief Executive Officer
With copies to:
Alloy, Inc.
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: General Counsel
and
Xxxxxx Xxxxxx Xxxxx & Xxxxxxxx
0000 Xxxxxx Xxxxxxxxx Xx., X.X.
East Lobby, Suite 700
Washington, District of Columbia
20007-5201
Telecopy: (000) 000-0000
Attention: Xxxxxxx Xxxx
(b) if to the Trustee:
Deutsche Bank Trust Company Americas
Corporate Trust & Agency Services
00 Xxxx Xxxxxx
27th Floor - Mail Stop NYC60-2710
Xxx Xxxx, XX 00000
85
The Company or the Trustee by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication to a Holder shall be mailed by
first class mail to his address shown on the Register kept by the Registrar.
Failure to mail a notice or communication to a Holder or any defect in such
notice or communication shall not affect its sufficiency with respect to other
Holders. If the company mails a notice or communication to Holders, it shall
mail a copy to the Trustee at the same time
If a notice or communication is mailed or sent in the manner
provided above within the time prescribed it is duly given as of the date it is
mailed, whether or not the addressee receives it, except that notice to the
Trustee shall only be effective upon receipt thereof by the Trustee.
SECTION 13.3. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Holders may communicate pursuant to Section 312(b) of the TIA
with other Holders with respect to their rights under the Securities or this
Indenture. The Company, the Trustee, the Registrar and anyone else shall have
the protection of Section 312(c) of the TIA.
SECTION 13.4. ACTS OF HOLDERS OF SECURITIES.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Holders of Securities may be embodied in and evidenced by:
(1) one or more instruments of substantially similar
tenor signed by such Holders in person or by agent or proxy duly
appointed in writing;
(2) the record of Holders of Securities voting in
favor thereof, either in person or by proxies duly appointed in
writing, at any meeting of Holders of Securities duly called and held
in accordance with the provisions of Article 8; or
(3) a combination of such instruments and any such
record.
Except as herein otherwise expressly provided, such action
shall become effective when such instrument or instruments or record or both are
delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments and record (and the action embodied
therein and evidenced thereby) are herein sometimes referred to as the "ACT" of
the Holders of Securities signing such instrument or instruments and so voting
at such meeting. Proof of execution of any such instrument or of a writing
appointing any such agent or proxy, or of the holding by any Person of a
Security, shall be sufficient for any purpose of this Indenture and (subject to
86
Section 5.1) conclusive in favor of the Trustee and the Company if made in the
manner provided in this Section. The record of any meeting of Holders of
Securities shall be proved in the manner provided in Section 8.6.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any manner which the Trustee
reasonably deems sufficient.
(c) The principal amount and serial numbers of Securities held
by any Person, and the date of such Person holding the same, shall be proved by
the Register.
(d) Any request, demand, authorization, direction, notice,
consent, election, waiver or other Act of the Holders of any Security shall bind
every future Holder of the same Security and the Holder of every Security issued
upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the
Trustee, the Company in reliance thereon, whether or not notation of such action
is made upon such Security.
SECTION 13.5. CERTIFICATE AND OPINION AS TO CONDITIONS
PRECEDENT.
In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an Officer of the Company may be
based, insofar as it relates to legal matters, upon an Opinion of Counsel,
unless such officer knows, or in the exercise of reasonable care should know,
that the Opinion of Counsel with respect to the matters upon which such
certificate or opinion is based is erroneous. Any such Opinion of Counsel may be
based, insofar as it relates to factual matters, upon a certificate or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
Upon any application or request by the Company to the Trustee
to take any action under any provision of this Indenture, the Company shall
furnish to the Trustee an Officers' Certificate stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with and an Opinion of Counsel stating that in the
87
opinion of such Counsel all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Indenture relating to such particular application or request, no
additional certificate or opinion need be furnished.
SECTION 13.6. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such
certificate or opinion on behalf of the Company, has read such covenant
or condition and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied with.
SECTION 13.7. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
SECTION 13.8. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
SECTION 13.9. SEPARABILITY CLAUSE.
In case any provision in this Indenture or the Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 13.10. BENEFITS OF INDENTURE.
Nothing contained in this Indenture or in the Securities,
express or implied, shall give to any Person, other than the parties hereto and
their successors hereunder and the Holders of Securities, any benefit or legal
88
or equitable right, remedy or claim under this Indenture.
SECTION 13.11. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
SECTION 13.12. COUNTERPARTS.
This instrument may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original but all such
counterparts shall together constitute but one and the same instrument.
SECTION 13.13. LEGAL HOLIDAYS.
In any case where any Interest Payment Date, Redemption Date,
Repurchase Date or Stated Maturity of any Security or the last day on which a
Holder of a Security has a right to convert such Security shall not be a
Business Day at any Place of Payment or Place of Conversion, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of Principal on or Interest on or conversion of the Securities, need not
be made at such Place of Payment or Place of Conversion on such day, but may be
made on the next succeeding Business Day at such Place of Payment or Place of
Conversion with the same force and effect as if made on the Interest Payment
Date, Redemption Date, Repurchase Date or at the Stated Maturity or on such last
day for conversion; provided, however, that in the case that payment is made on
such succeeding Business Day, no Interest shall accrue on the amount so payable
for the period from and after such Interest Payment Date, Redemption Date,
Repurchase Date or Stated Maturity, as applicable.
SECTION 13.14. RECOURSE AGAINST OTHERS.
No recourse for the payment of the Principal of or Interest on
any Securities, or for any claim based thereon or otherwise in respect thereof,
shall be had against any incorporator, shareholder, officer or director or
manager, as such, past, present or future, of the Company of any successor
entity to the Company, whether by virtue of any constitution, statute or rule of
law or by the enforcement of any assessment or penalty or otherwise, all such
liability being, by the acceptance thereof and as part of the consideration for
the issue thereof, expressly waived and released.
89
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed all as of the day and year first above written.
ALLOY, INC.
By: /s/ Xxxx X. XxXxxxx
------------------------------------------
Name: Xxxx X. XxXxxxx
Title: Vice President and General Counsel
DEUTSCHE BANK TRUST COMPANY
AMERICAS, AS TRUSTEE AND
NOT IN ITS INDIVIDUAL
CAPACITY.
By: /s/ Xxxxx Xxxxxxxxxxxx
------------------------------------------
Name: Xxxxx Xxxxxxxxxxxx
Title: Associate
90
EXHIBIT A
[FORM OF FACE OF GLOBAL SECURITY]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS TO
NOMINEES OF THE DEPOSITORY TRUST COMPANY, OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE REFERRED TO ON
THE REVERSE HEREOF.
THE SECURITY EVIDENCED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT AS SET
FORTH IN THE FOLLOWING SENTENCE. BY ACQUISITION HEREOF, THE HOLDER:
(1) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE ORIGINAL
ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THE SECURITY
EVIDENCED HEREBY OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH
SECURITY EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), OR (D)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT AND WHICH CONTINUES TO BE EFFECTIVE AT THE
TIME OF SUCH TRANSFER; AND
(2) AGREES THAT IT WILL DELIVER TO THE ISSUER HEREOF, AT LEAST 3
BUSINESS DAYS PRIOR TO ANY INTENDED TRANSFER PURSUANT TO THE PROVISIONS
OF CLAUSE 1(D) ABOVE, A WRITTEN NOTICE OF SUCH HOLDER'S INTENTION TO
EFFECT SUCH A TRANSFER, WHICH NOTICE SHALL REMAIN EFFECTIVE FOR 5
BUSINESS DAYS AFTER SUCH DELIVERY; AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY
EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO
CLAUSE 1(D) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY WITHIN
TWO YEARS AFTER THE ORIGINAL ISSUANCE OF SUCH SECURITY (OTHER THAN A
TRANSFER PURSUANT TO CLAUSE 1(D) ABOVE), THE HOLDER MUST CHECK THE
APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER
OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE (OR ANY
SUCCESSOR TRUSTEE, AS APPLICABLE). IF THE PROPOSED TRANSFER IS PURSUANT
TO CLAUSE 1(B) OR 1(C) ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE COMPANY OR
THE TRUSTEE MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS
BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE TRANSFER OF THE
SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE 1(D) ABOVE OR THE
EXPIRATION OF TWO YEARS FROM THE ORIGINAL ISSUANCE OF THE SECURITY
EVIDENCED HEREBY.
A-2
ALLOY, INC.
5.375% CONVERTIBLE SENIOR DEBENTURE DUE 2023
CUSIP NO. 019855 AA 3
No._____________ $_________________
ALLOY, INC., a Delaware corporation (including any successor
corporation under the Indenture hereinafter referred to, the "COMPANY"), for
value received, hereby promises to pay to _______________, or its registered
assigns, the principal sum of _____________ U.S. Dollars ($_______________) on
August 1, 2023.
Interest Payment Dates: February 1 and August 1, commencing
February 1, 2004.
Regular Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this
Security set forth below, which further provisions shall for all purposes have
the same effect as if set forth at this place.
A-3
IN WITNESS WHEREOF, the Company has caused this Security to be
duly executed manually or by facsimile by its duly authorized officers.
ALLOY, INC.
By:
-------------------------------------------
Name:
Title:
By:
-------------------------------------------
Name:
Title:
Dated:
Trustee's Certificate of Authentication
This is one of the 5.375% Convertible Senior Debentures due 2023 described in
the within-named Indenture.
DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee
By: _____________________________
Authorized Signatory
Dated: _____________,
A-4
[FORM OF REVERSE OF GLOBAL SECURITY]
5.375% Convertible Senior Notes due 2023
This Security is one of a duly authorized issue of the 5.375%
Convertible Senior Notes due 2023 (the "Securities") of Alloy, Inc.., a Delaware
corporation (including any successor corporation under the Indenture hereinafter
referred to, the "Company"), issued under an Indenture, dated as of July 23,
2003 (the "Indenture"), between the Company and Deutsche Bank Trust Company
Americas, as trustee (the "Trustee"). The terms of the Security include those
stated in the Indenture, those made part of the Indenture by reference to the
Trust Indenture Act of 1939, as amended ("TIA"), and those set forth in this
Security. This Security is subject to all such terms, and Holders are referred
to the Indenture and the TIA for a statement of all such terms. To the extent
permitted by applicable law, in the event of any inconsistency between the terms
of this Security and the terms of the Indenture, the terms of the Indenture
shall control. Capitalized terms used but not defined herein have the meanings
assigned to them in the Indenture referred to below unless otherwise indicated.
1. Interest
The Company promises to pay Interest on the principal amount
of the Securities at the interest rate of 5.375% (the "Interest Rate") from the
date of issuance until repayment in full at August 1, 2023, or until an earlier
conversion, redemption or repurchase. The Company will pay Interest on this
Security semi-annually in arrears on February and July of each year (each, an
"interest payment date"), commencing February 1, 2004.
The Securities shall bear interest from July 23, 2003 until
the principal amount thereof is paid or made available for payment, or until
such date on which the Securities are converted, redeemed or purchased as
provided herein at a rate of 5.375% per annum.
Interest on the Securities shall be computed (i) for any full
semi-annual period for which a particular Interest Rate is applicable, on the
basis of a 360-day year of twelve 30-day months and (ii) for any period for
which a particular Interest Rate is applicable for less than a full semiannual
period for which Interest is calculated, on the basis of a 30-day month and, for
such periods of less than a month, the actual number of days elapsed over a
30-day month.
If this Security is redeemed or repurchased by the Company on
a date that is after the record date and prior to the corresponding interest
payment date, interest accrued and unpaid hereon to but not including the
applicable Redemption Date or Change of Control Purchase Date, as the case may
be, will be paid to the same Holder to whom the Company pays the principal of
this Security.
Interest on Securities converted after a record date but prior
to the corresponding interest payment date will be paid to the Holder of the
Securities on the record date but, upon conversion, the Holder must pay the
Company the interest which has accrued and will be paid on such interest payment
date; provided, that no such payment need be made with respect to Securities
A-5
which will be redeemed by the Company after a record date and prior to the third
Business Day after the corresponding interest payment date.
If the principal amount hereof or any portion of such
principal amount or any interest on any Security is not paid when due (whether
upon acceleration pursuant to Section 4.8 of the Indenture, upon the date set
for payment of the Redemption Price pursuant to Section 10 hereof or the
Repurchase Price pursuant to Section 11 hereof or upon the Stated Maturity of
this Security), then in each such case the overdue amount shall, to the extent
permitted by law, bear interest at the Interest Rate, compounded semi-annually,
which interest shall accrue from the date on which such overdue amount was
originally due to the date of payment of such amount, including interest
thereon, has been made or duly provided for. All such interest shall be payable
on demand.
2. Method of Payment.
Except as provided below, interest will be paid (i) on the
Global Securities to The Depository Trust Company ("DTC") or its nominee in
immediately available funds, (ii) on any definitive Securities having an
aggregate principal amount of $5,000,000 or less, by check mailed to the Holders
of such Securities; and (iii) on any definitive Securities having an aggregate
principal amount of more than $5,000,000, by wire transfer in immediately
available funds at the election of the Holders of such Securities.
At Stated Maturity the Company will pay interest on definitive
Securities at the Company's office or agency in New York City, which initially
will be the Corporate Trust Office of the Trustee in New York City.
Principal on Global Securities will be paid to DTC or its
nominee in immediately available funds. Principal on definitive Securities will
be payable, upon Stated Maturity or when due, at the office or agency of the
Company in New York City, maintained for such purpose, initially the Corporate
Trust Office of the Trustee in New York City.
Subject to the terms and conditions of the Indenture, the
Company will make payments in cash in respect of Redemption Prices, Repurchase
Prices and at Stated Maturity to Holders who surrender Securities to a Paying
Agent to collect such payments in respect of the Securities. 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.
3. Paying Agent, Conversion Agent and Registrar.
Initially, Deutsche Bank Trust Company Americas (the
"Trustee") will act as Paying Agent, Conversion Agent and Registrar. The Company
may appoint and change any Paying Agent, Conversion Agent or Registrar without
notice, other than notice to the Trustee; provided 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 or Registrar.
A-6
4. Indenture.
The Securities are senior unsecured obligations of the Company
limited to $65,000,000 ($78,000,000 if the Initial Purchasers' over-allotment
option is exercised in full pursuant to the Purchase Agreement) in aggregate
principal amount. The Indenture does not limit other indebtedness of the
Company, secured or unsecured.
5. Redemption at the Option of the Company.
No sinking fund is provided for the Securities. The Securities
are not redeemable by the Company prior to August 1, 2008. At any time on or
after August 1, 2008, except for Securities that it is required to purchase
pursuant to Section 11.1 of the Indenture or required to convert pursuant to
Section 12.1 of the Indenture, the Company may, at its option, redeem this
Security in whole at any time or in part from time to time, on any date prior to
the Stated Maturity of the Security, upon notice as set forth in Section 10.4 of
the Indenture, at the Redemption Price (expressed in percentages of the
principal amount) set forth below if, but only if, redeemed on a Redemption Date
occurring each August 1 during the 12-month period beginning on the years
indicated:
------------------------------------------------------- -----------------
Redemption
During the Twelve Months Commencing Price
------------------------------------------------------- -----------------
2008................................................ 103.000%
------------------------------------------------------- -----------------
2009................................................ 102.000%
------------------------------------------------------- -----------------
2010................................................ 101.000%
------------------------------------------------------- -----------------
2011 and thereafter................................. 100.000%
------------------------------------------------------- -----------------
If the Company exercises its option to redeem this Security
pursuant, a Holder may nevertheless exercise its right to have this Security
purchased pursuant to Section 11.1 of the Indenture, if applicable, and to
convert such Securities pursuant to Article 12 of the Indenture, in each case,
until the close of business two Business Days immediately preceding the
Redemption Date.
The Company shall pay any Interest to the Holder of this
Security if called for redemption (including if it is converted into Common
Stock after the date the notice of the redemption is mailed and prior to the
Redemption Date) accrued but not paid to, but excluding, the Redemption Date
pursuant to Section 1 of the this Security; provided, however, that if the
Redemption Date is an Interest Payment Date, the Company shall pay the Interest
to the Holder of the Security at the close of business on such Interest Payment
Date. If the Security is redeemed, then on and after the Redemption Date,
Interest shall cease to accrue on Securities or portions of Securities called
for redemption, unless the Company defaults in the payment of the Redemption
Price.
Securities in original denominations larger than $1,000 may be
redeemed in part. If any Security selected for partial redemption is converted
or elected to be purchased in part before termination of the conversion right
with respect to the portion of the Security so selected, the converted or
purchased portion of such Security shall be deemed to be the portion selected
A-7
for redemption (provided, however, that the Holder of such Security so converted
or purchased 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 or purchase of such
Security). Securities which have been converted or purchased during a selection
of Securities to be redeemed may be treated by the Trustee as outstanding for
the purpose of such selection.
The Company is required to furnish the notice of redemption to
the Holders as provided in the Indenture.
6. Purchase Right Upon a Specific Date or Repurchase Event.
If a Repurchase Event occurs, this Security, at the Holder's
option, shall have the right, subject to the conditions and in accordance with
the provisions of the Indenture, to require the Company to purchase this
Security (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 Security to be outstanding after such purchase is at least equal
to $1,000 or an integral multiple thereof) at the Repurchase Price, plus any
accrued and unpaid Interest to, but excluding, the Repurchase Date; provided,
however, that (i) installments of Interest on this Security if its Stated
Maturity is prior to or on the Repurchase Event Purchase Date shall be payable
to the Holders of this Security, registered as such on the relevant Regular
Record Date according to their terms and the provisions of Section 1 of this
Security.
7. Notice of Redemption.
Notice of redemption pursuant to Section 5 of this Security
will be mailed at least 30 days but not more than 60 days before the Redemption
Date to each Holder of Securities to be redeemed at the Holder's registered
address. If money sufficient to pay the Redemption Price of all Securities (or
portions thereof) to be redeemed on the Redemption Date is deposited with the
Paying Agent prior to or on the Redemption Date, immediately after such
Redemption Date interest ceases to accrue on such Securities or portions
thereof.
8. Conversion.
Subject to and in compliance with the provisions of the
Indenture, a Holder is entitled, at such Holder's option, to convert the
Holder's Security (or any portion of the principal amount thereof that is $1,000
or an integral multiple $1,000), into fully paid and nonassessable shares of
Common Stock at the Conversion Price in effect at the time of conversion.
A Security in respect of which a Holder has delivered a
Repurchase Election Form, exercising the option of such Holder to require the
Company to purchase such Security, may be converted only if such Repurchase
Election Form is withdrawn in accordance with the terms of the Indenture.
The initial Conversion Price is $8.375, subject to adjustment
in certain events described in the Indenture. A Holder that surrenders
Securities for conversion will receive cash or a check in lieu of any fractional
share of Common Stock.
A-8
To surrender a Security for conversion, a Holder must (1)
complete and manually sign the conversion notice below (or complete and manually
sign a facsimile of such notice) and deliver such notice to the Conversion
Agent, (2) surrender the Security to the Conversion Agent, (3) furnish
appropriate endorsements and transfer documents and (4) pay any transfer or
similar tax, if required by the Indenture.
No fractional shares of Common Stock shall be issued upon
conversion of any Security. Instead of any fractional share of Common Stock that
would otherwise be issued upon conversion of such Security, the Company shall
pay a cash adjustment as provided in the Indenture.
If the Company (i) is a party to a consolidation, merger or
binding share exchange, (ii) reclassifies the Common Stock or (iii) conveys,
transfers or leases its properties and assets substantially as an entirety to
any Person, the right to convert a Security into shares of Common Stock may be
changed into a right to convert it into securities, cash or other assets of the
Company or such other Person, in each case in accordance with the Indenture.
9. Denominations; Transfer; Exchange.
The Securities 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 Securities in accordance with the Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not transfer or exchange
any Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities in respect of which a Repurchase Election Form has been given and not
withdrawn (except, in the case of a Security to be purchased in part, the
portion of the Security not to be purchased) or any Securities for a period of
15 days before the mailing of a notice of redemption of Securities to be
redeemed.
10. Persons Deemed Owners.
The registered Holder of this Security as shown on the
Register may be treated as the owner of this Security for all purposes.
11. Unclaimed Money or Securities.
The Trustee and the Paying Agent shall return to the Company
upon written request any money held by them for the payment of any amount with
respect to the Securities that remains unclaimed for two years, subject to
applicable unclaimed property 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.
12. Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i)
the Indenture or the Securities may be amended (a) with the written consent of
the Holders of at least a majority in aggregate principal amount of the
A-9
outstanding Securities or (b) by the adoption of a resolution, at a meeting of
Holders of the Securities at the time outstanding at which a quorum is present,
by the Holders of at least a majority of the aggregate principal amount of the
Securities at the time outstanding represented at such meeting, and (ii) certain
Defaults may be waived (a) with the written consent of the Holders of a majority
in aggregate principal amount of the outstanding Securities or (b) by the
adoption of a resolution, at a meeting of Holders of the Securities at the time
outstanding at which a quorum is present, by the Holders of at least a majority
of the aggregate principal amount of the Securities at the time outstanding
represented at such meeting. The Indenture and the Securities may also be
amended by the Company and the Trustee, without the consent of any Holder, in
certain circumstances set forth in the Indenture; provided, that certain
provisions of the Indenture and the Securities may not be amended without the
consent of each affected Holder.
13. Defaults and Remedies.
If any Event of Default with respect to Securities shall occur
and be continuing, the principal of all the Securities may be declared due and
payable in the manner and with the effect provided in the Indenture.
14. Trustee Dealings with the Company.
Subject to certain limitations imposed by the TIA, the Trustee
under the Indenture, in its individual or any other capacity, may become the
owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its Affiliates and may otherwise deal
with the Company or its Affiliates with the same rights it would have if it were
not Trustee.
15. No Recourse Against Others.
A director, officer, employee or shareholder, as such, of the
Company shall not have any liability for any obligations of the Company under
the Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Securities.
16. Authentication.
This Security shall not be valid until an authorized signatory
of the Trustee manually signs the Trustee's Certificate of Authentication on the
other side of this Security.
17. Abbreviations.
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (=joint tenants with right of survivorship
and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to
Minors Act).
A-10
18. GOVERNING LAW.
THIS SECURITY AND THE INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
The Company will furnish to any Securityholder upon written
request and without charge a copy of the Indenture which has in it the text of
this Security in larger type. Requests may be made to:
Alloy, Inc.
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: General Counsel
19. Registration Rights.
The Holders of the Securities are entitled to the benefits of
a Resale Registration Rights Agreement, dated as of July 23, 2003, between the
Company, Xxxxxx Brothers Inc., CIBC World Markets Corp., XX Xxxxxx Securities,
Inc. and XX Xxxxx Securities Corporation including the receipt of Additional
Amounts (as defined in such agreement) upon a registration default (as defined
in such agreement).
A-11
SCHEDULE OF INCREASES AND DECREASES OF GLOBAL SECURITY
Initial Principal Amount of Global Security: ____________ ($___________).
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Date Amount of Increase Amount of Decrease in Principal Amount of Notation by
in Principal Amount Principal Amount of Global Security Registrar or
of Global Security Global Security After Increase or Security Custodian
Decrease
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
------------------------- ---------------------- ----------------------- ---------------------- ----------------------
A-12
ASSIGNMENT FORM
To assign this Security, fill in the form below and have your signature
guaranteed:
(I) or (we) assign and transfer this Security to:
(Insert assignee's social security or tax I.D. number)
(Print or type assignee's name, address and zip code)
and irrevocably appoint ____________ to transfer this Security on the books of
the Company. The agent may substitute another to act for him.
Your Name:
-------------------------------------------------------------
(Print your name exactly as it appears on the face of this Security)
Dated:
-----------------------------------------------------------------
Your Signature:
-------------------------------------------------------------
(Sign exactly as your name appears on the face of this Security)
Signature Guarantee*:
-------------------------------------------------------
--------
* Participant in a recognized Signature Guarantee Medallion Program (or other
Signature guarantor acceptable to the Trustee). * Participant in a recognized
Signature Guarantee Medallion Program (or other Signature guarantor acceptable
to the Trustee).
A-13
CONVERSION NOTICE
TO: Alloy, Inc.
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: General Counsel
The undersigned registered owner of this Security hereby
irrevocably exercises the option to convert this Security, or the portion hereof
(which is $1,000 principal amount or an integral multiple thereof) below
designated, into shares of Common Stock in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable and
deliverable upon such conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. If shares or any portion of this
Security not converted are to be issued in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto. To the extent provided in the Indenture, any amount required to be paid
to the undersigned on account of Interest, accompanies this Security.
Your Name:
-------------------------------------------------------------------------------------
(Print your name exactly as it appears on the face of this Security)
Dated:
------------------------------------------------------------------------------------------
Your Signature: ____________________________________________________
(Sign exactly as your name appears on the face of this Security)
Social Security or other Taxpayer Identification Number:
----------------------------------------
Principal amount to be converted (if less than all): $
Signature Guarantee*?:
--------------------------------------------------------------------------
Fill in for registration of shares (if to be issued) and Securities (if
to be delivered) other than to and in the name of the registered holder:
--------------------------------------------------------------------------------
(Name)
--------------------------------------------------------------------------------
(Street Address)
--------------------------------------------------------------------------------
(City, State and Zip Code)
A-14
* Participant in a recognized Signature Guarantee Medallion Program (or other
Signature guarantor acceptable to the Trustee).
A-15
EXHIBIT B
[FORM OF FACE OF CERTIFICATED SECURITY]
THE SECURITY EVIDENCED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT AS SET
FORTH IN THE FOLLOWING SENTENCE. BY ACQUISITION HEREOF, THE HOLDER:
(1) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE ORIGINAL
ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THE SECURITY
EVIDENCED HEREBY OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH
SECURITY EXCEPT (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), OR (D)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT AND WHICH CONTINUES TO BE EFFECTIVE AT THE
TIME OF SUCH TRANSFER;
(2) AGREES THAT IT WILL DELIVER TO THE ISSUER HEREOF, AT LEAST 3
BUSINESS DAYS PRIOR TO ANY INTENDED TRANSFER PURSUANT TO THE PROVISIONS
OF CLAUSE 1(D) ABOVE, A WRITTEN NOTICE OF SUCH HOLDER'S INTENTION TO
EFFECT SUCH A TRANSFER, WHICH NOTICE SHALL REMAIN EFFECTIVE FOR 5
BUSINESS DAYS AFTER SUCH DELIVERY; AND
(3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY
EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO
CLAUSE 1(D) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.
IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY WITHIN
TWO YEARS AFTER THE ORIGINAL ISSUANCE OF SUCH SECURITY (OTHER THAN A
TRANSFER PURSUANT TO CLAUSE 1(D) ABOVE), THE HOLDER MUST CHECK THE
APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER
OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE (OR ANY
SUCCESSOR TRUSTEE, AS APPLICABLE). IF THE PROPOSED TRANSFER IS PURSUANT
TO CLAUSE 1(B) OR 1(C) ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE COMPANY OR
B-2
THE TRUSTEE MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS
BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE TRANSFER OF THE
SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE 1(D) ABOVE OR THE
EXPIRATION OF TWO YEARS FROM THE ORIGINAL ISSUANCE OF THE SECURITY
EVIDENCED HEREBY.
ALLOY, INC.
5.375% CONVERTIBLE SENIOR DEBENTURE DUE 2023
No.: _________ CUSIP:
Issue Date: _____, 2003 Principal Amount: $_________
ALLOY, INC., a Delaware corporation (including any successor
corporation under the Indenture hereinafter referred to, the "COMPANY"), for
value received, hereby promises to pay to _______________, or its registered
assigns, the principal sum of _____________ U.S. Dollars ($_______________) on
August 1, 2023.
Interest Payment Dates: February 1 and August 1, commencing February 1,
2004.
Regular Record Dates: January 15 and July 15.
Reference is hereby made to the further provisions of this Security set
forth below, which further provisions shall for all purposes have the same
effect as if set forth at this place.
B-3
IN WITNESS WHEREOF, the Company has caused this Security to be
duly executed manually or by facsimile by its duly authorized officers.
ALLOY, INC.
By:
-----------------------------------------
Name:
Title:
By:
-----------------------------------------
Name:
Title:
Dated: [ ], 2003
Trustee's Certificate of Authentication
This is one of the 5.375% Convertible Senior Debentures due 2023 described in
the within-named Indenture.
DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee
By: _____________________________
Authorized Signatory
Dated: _____________, 2003
B-4
[FORM OF REVERSE OF CERTIFICATED SECURITY IS IDENTICAL TO EXHIBIT A]
EXHIBIT C
5.375% Convertible Senior Debentures due 2023
TRANSFER CERTIFICATE
In connection with any transfer of any of the Securities or beneficial
interest in a Global Security that is a Restricted Security 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 or
beneficial owner of this Security hereby certifies with respect to $____________
principal amount of the above-captioned Securities (the "Surrendered
Securities") presented or surrendered on the date hereof for registration of
transfer, or for exchange or conversion where the securities issuable upon such
exchange or conversion are to be registered in a name other than that of the
undersigned registered or beneficial owner (each such transaction being a
"transfer"), that such transfer complies with the restrictive legend set forth
on the face of the Surrendered Securities for the reason checked below:
[_] A transfer of the Surrendered Securities is
made to the Company or any subsidiaries; or
[_] The transfer of the Surrendered Securities
is made to a Qualified Institutional Buyer
in compliance with Rule 144A under the
Securities Act; or
[_] A transfer of the Surrendered Securities
pursuant to an exemption from registration
under Rule 144A under the Securities Act;
and unless the box below is checked, the undersigned
confirms that, to the undersigned's knowledge, such Securities
are not being transferred to an "affiliate" of the Company as
defined in Rule 144 under the Securities Act (an "Affiliate").
[_] The transferee is an Affiliate
of the Company.
DATE:__________________________________
Signature(s)
(If the registered owner is a corporation,
partnership or fiduciary, the title of the person signing on
behalf of such registered owner must be stated.)
A-1
Signature Guaranteed*
--------------------------------
*Participant in a recognized Signature
Guarantee Medallion Program (or other Signature guarantor
acceptable to the Trustee).
A-2
CONVERSION NOTICE
TO: Alloy, Inc.
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: General Counsel
The undersigned registered owner of this Security hereby
irrevocably exercises the option to convert this Security, or the portion hereof
(which is $1,000 principal amount or an integral multiple thereof) below
designated, into shares of Common Stock in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable and
deliverable upon such conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. If shares or any portion of this
Security not converted are to be issued in the name of a person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto. To the extent provided in the Indenture, any amount required to be paid
to the undersigned on account of Interest, accompanies this Security.
Your Name:
-------------------------------------------------------------------------------------
(Print your name exactly as it appears on the face of this Security)
Dated:
------------------------------------------------------------------------------------------
Your Signature: ____________________________________________________
(Sign exactly as your name appears on the face of this Security)
Social Security or other Taxpayer Identification Number:
----------------------------------------
Principal amount to be converted (if less than all): $
Signature Guarantee*?:
--------------------------------------------------------------------------
Fill in for registration of shares (if to be issued) and Securities (if
to be delivered) other than to and in the name of the registered holder:
--------------------------------------------------------------------------------
(Name)
--------------------------------------------------------------------------------
(Street Address)
--------------------------------------------------------------------------------
(City, State and Zip Code)
A-3
* Participant in a recognized Signature Guarantee Medallion Program (or other
Signature guarantor acceptable to the Trustee).
A-4
REPURCHASE ELECTION FORM
TO: Alloy, Inc.
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: General Counsel
The undersigned registered owner of this Security hereby
irrevocably acknowledges receipt of a notice from Alloy, Inc. (the "COMPANY") as
to the occurrence of a Repurchase Event with respect to the Company and requests
and instructs the Company to repay the entire principal amount of this Security,
or the portion thereof (which is $1,000 principal amount or an integral multiple
thereof) below designated, in accordance with the terms of the Indenture
referred to in this Security, together with Interest accrued and unpaid to, but
excluding, such date, to the registered holder hereof.
Your Name:
-------------------------------------------------------------------------------------
(Print your name exactly as it appears on the face of this Security)
Dated:
------------------------------------------------------------------------------------------
Your Signature: ____________________________________________________
(Sign exactly as your name appears on the face of this Security)
Social Security or other Taxpayer Identification Number:
----------------------------------------
Principal amount to be repurchased (if less than all): $
Signature Guarantee*?:
--------------------------------------------------------------------------
A-5
