WF&G DRAFT
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8/28/97
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_______________________________________________________________________________
INDENTURE
Dated as of SEPTEMBER __, 1997
between
SYSTEM SOFTWARE ASSOCIATES, INC.
and
XXXXXX TRUST AND SAVINGS BANK,
as Trustee
___% Convertible Subordinated Notes due 2002
________________________________________________________________________________
CROSS-REFERENCE TABLE*
INDENTURE
TIA SECTION SECTION
----------- -----------
(S) 310(a)(1)................................................ 8.9
(a)(2)................................................ 8.9
(a)(3)................................................ N.A.**
(a)(4)................................................ N.A.
(a)(5)................................................ 8.9
(b)................................................... 8.8; 8.9;
8.10
(c)................................................... N.A.
(S) 311(a)................................................... 8.13
(b)................................................... 8.13
(c)................................................... N.A.
(S) 312(a)................................................... 6.1
(b)................................................... 6.2
(c)................................................... 6.2
(S) 313(a)................................................... 6.3
(b)(1)................................................ N.A.
(b)(2)................................................ 6.3
(c)................................................... 6.3; 17.3
(d)................................................... 6.3
(S) 314(a)................................................... 5.8; 6.4;
17.3
(b)................................................... N.A.
(c)(1)................................................ 17.5
(c)(2)................................................ 17.5
(c)(3)................................................ N.A.
(d)................................................... N.A.
(e)................................................... 17.5
(f)................................................... N.A.
(S) 315(a)................................................... 8.1(a)
(b)................................................... 7.8; 17.3
(c)................................................... 8.1
(d)................................................... 8.1
(e)................................................... 7.9
(S) 316(a)(last sentence).................................... 9.4
(a)(1)................................................ 7.7
(a)(2)................................................ N.A.
(b)................................................... 7.7
(c)................................................... 10.4;
15.5(h)(4)
(S) 317(a)(1)................................................ 7.5
(a)(2)................................................ 7.5
(b)................................................... 8.5; 13.2
(S) 318(a)................................................... 17.7
* This Cross-Reference Table shall not, for any purpose, be deemed a part of
this Indenture.
** N.A. means Not Applicable.
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TABLE OF CONTENTS
Page
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ARTICLE I. DEFINITIONS......................................... 1
Section 1.1. Definitions............................... 1
Affiliate................................. 2
Board of Directors........................ 2
Business Day.............................. 2
Change in Control......................... 2
Closing Price............................. 2
Commission................................ 2
Common Stock.............................. 2
Company................................... 3
Controlled................................ 3
Conversion Price.......................... 3
Corporate Trust Office.................... 3
Current Market Price...................... 3
Custodian................................. 3
default................................... 3
Defaulted Interest........................ 3
Depository................................ 4
Designated Senior Indebtedness............ 4
Exchange Act.............................. 4
Expiration Time........................... 4
Event of Default.......................... 4
Global Security........................... 4
Indebtedness.............................. 4
Indenture................................. 5
Initial Purchasers........................ 5
Junior Notes.............................. 5
New Preferred Stock....................... 5
New Securities............................ 5
Officers' Certificate..................... 5
Opinion of Counsel........................ 6
outstanding............................... 6
Payment Blockage Notice................... 6
Person.................................... 6
Predecessor Security...................... 6
Purchased Shares.......................... 7
Record Date............................... 7
Representative............................ 7
Responsible Officer....................... 7
Repurchase Date........................... 7
Repurchase Price.......................... 7
Securities Act............................ 7
Security or Securities.................... 7
Security register......................... 8
Securityholder or holder.................. 8
Senior Indebtedness....................... 8
Significant Subsidiary.................... 8
Subsidiary................................ 8
Trading Day............................... 9
(i)
Trigger Event............................ 9
Trust Indenture Act...................... 9
Trustee.................................. 9
U.S. Government Obligations.............. 9
Warrants................................. 9
ARTICLE II. ISSUE, DESCRIPTION, EXECUTION, REGISTRATION
AND EXCHANGE OF SECURITIES.......................... 9
Section 2.1. Designation, Amount and Issue of
Securities.................................... 9
Section 2.2. Form of Note.................................... 10
Section 2.3. Date and Denomination of Securities
Payments of Interest.......................... 11
Section 2.4. Execution of Securities......................... 13
Section 2.5. Exchange and Registration of Transfer
of Securities; Depository..................... 13
Section 2.6. Mutilated, Destroyed, Lost or Stolen
Securities.................................... 17
Section 2.7. Temporary Securities............................ 18
Section 2.8. Cancellation of Securities Paid, Etc. .......... 19
ARTICLE III. REDEMPTION OF SECURITIES............................... 19
Section 3.1. Redemption Prices............................... 19
Section 3.2. Notice of Redemption; Selection of
Securities.................................... 19
Section 3.3. Payment of Securities Called for
Redemption.................................... 21
Section 3.4. Conversion Arrangement on Call for
Redemption.................................... 22
ARTICLE IV. SUBORDINATION OF SECURITIES............................ 23
Section 4.1. Agreement of Subordination...................... 23
Section 4.2. Payments to Securityholders..................... 23
Section 4.3. Subrogation of Securities....................... 26
Section 4.4. Authorization to Effect Subordination........... 27
Section 4.5. Notice to Trustee............................... 28
Section 4.6. Trustee's Relation to Senior Indebtedness....... 29
Section 4.7. No Impairment of Subordination.................. 29
Section 4.8. Certain Conversions Deemed Payment.............. 29
Section 4.9. Article Applicable to Paying Agents............. 30
Section 4.10. Senior Indebtedness Entitled to Rely............ 30
ARTICLE V. PARTICULAR COVENANTS OF THE COMPANY.................... 30
Section 5.1. Payment of Principal, Premium and
Interest...................................... 30
Section 5.2. Maintenance of Office or Agency................. 31
Section 5.3. Appointments to Fill Vacancies in
Trustee's Office................................ 31
Section 5.4. Provisions as to Paying Agent................... 32
Section 5.5. Corporate Existence............................. 33
Section 5.6. Amendments to Junior Notes, Warrants
or New Preferred Stock........................ 33
Section 5.7. Stay, Extension and Usury Laws.................. 33
Section 5.8. Compliance Certificate.......................... 34
(ii)
Section 5.9. No Prepayment of Junior Notes at the Option of
the Company.......................................... 34
Section 5.10. No Repurchase of Warrants.............................. 34
Section 5.11. Liquidation............................................ 34
Section 5.12. Notice of Defaults..................................... 35
Section 5.13. Payment of Taxes and Other Claims...................... 35
Section 5.14. Further Instruments and Acts........................... 35
ARTICLE VI. SECURITYHOLDERS' LISTS AND REPORTS BY THE COMPANY AND
TRUSTEE................................................... 36
Section 6.1. Securityholders' Lists................................. 36
Section 6.2. Preservation and Disclosure of Lists................... 36
Section 6.3. Reports by Trustee..................................... 37
Section 6.4. Reports by Company..................................... 37
ARTICLE VII. REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS ON AN EVENT
OF DEFAULT................................................ 37
Section 7.1. Events of Default...................................... 37
Section 7.2. Payments of Securities on Default; Suit Therefor....... 40
Section 7.3. Application of Monies Collected by Trustee............. 42
Section 7.4. Proceedings by Securityholder.......................... 43
Section 7.5. Proceedings by Trustee................................. 44
Section 7.6. Remedies Cumulative and Continuing..................... 44
Section 7.7. Direction of Proceedings and Waiver of Defaults by
Majority of Securityholders.......................... 44
Section 7.8. Notice of Defaults..................................... 45
Section 7.9. Undertaking to Pay Costs............................... 45
ARTICLE VIII. CONCERNING THE TRUSTEE...................................... 46
Section 8.1. Duties and Responsibilities of Trustee................. 46
Section 8.2. Reliance on Documents, Opinions, Etc................... 47
Section 8.3. No Responsibility for Recitals, Etc.................... 48
Section 8.4. Trustee, Paying Agents, Conversion Agents or
Registrar May Own Securities......................... 49
Section 8.5. Monies to Be Held in Trust............................. 49
Section 8.6. Compensation and Expenses of Trustee................... 49
Section 8.7. Officers' Certificate as Evidence...................... 50
Section 8.8. Conflicting Interests of Trustee....................... 50
Section 8.9. Eligibility of Trustee................................. 50
Section 8.10. Resignation or Removal of Trustee...................... 50
Section 8.11. Acceptance by Successor Trustee........................ 52
Section 8.12. Succession by Merger, Etc.............................. 53
Section 8.13. Limitation on Rights of Trustee as Creditor............ 53
ARTICLE IX. CONCERNING THE SECURITYHOLDERS.............................. 53
Section 9.1. Action by Securityholders.............................. 53
Section 9.2. Proof of Execution by Securityholders.................. 54
Section 9.3. Who Are Deemed Absolute Owners......................... 54
Section 9.4. Company-Owned Security Disregarded..................... 54
Section 9.5. Revocation of Consents: Future Holders Bound........... 53
(iii)
ARTICLE X. SECURITYHOLDERS' MEETINGS................................... 56
Section 10.1. Purpose of Meetings.................................... 56
Section 10.2. Call of Meetings by Trustee............................ 56
Section 10.3. Call of Meetings by Company or Securityholders......... 57
Section 10.4. Qualifications for Voting.............................. 57
Section 10.5. Regulations............................................ 57
Section 10.6. Voting................................................. 58
Section 10.7. No Delay of Rights by Meeting.......................... 58
ARTICLE XI. SUPPLEMENTAL INDENTURES..................................... 59
Section 11.1. Supplemental Indentures Without Consent of
Securityholders...................................... 59
Section 11.2. Supplemental Indentures with Consent of
Securityholders...................................... 60
Section 11.3. Effect of Supplemental Indenture....................... 61
Section 11.4. Notation on Security................................... 61
Section 11.5. Evidence of Compliance of Supplemental Indenture to
Be Furnished Trustee................................. 62
ARTICLE XII. CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE........... 62
Section 12.1. Company May Consolidate Etc. on Certain Terms.......... 62
Section 12.2. Successor Corporation to Be Substituted................ 62
Section 12.3. Opinion of Counsel to Be Given Trustee................. 63
ARTICLE XIII. SATISFACTION AND DISCHARGE OF INDENTURE..................... 63
Section 13.1. Discharge of Indenture................................. 63
Section 13.2. Deposited Monies to Be Held in Trust by Trustee........ 64
Section 13.3. Paying Agent to Repay Monies Held...................... 64
Section 13.4. Return of Unclaimed Monies............................. 65
Section 13.5. Reinstatement.......................................... 65
ARTICLE XIV. IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND
DIRECTORS................................................. 65
Section 14.1. Indenture and Securities Solely Corporate
Obligations.......................................... 65
ARTICLE XV. CONVERSION OF SECURITIES.................................... 66
Section 15.1. Right to Convert....................................... 66
Section 15.2. Exercise of Conversion Privilege; Issuance of Common
Stock on Conversion; No Adjustment for Interest or
Dividends............................................ 66
Section 15.3. Cash Payments in Lieu of Fractional Shares............. 68
Section 15.4. Conversion Price....................................... 68
Section 15.5. Adjustment of Conversion Price......................... 68
Section 15.6. Effect of Reclassification, Consolidation, Merger or
Sale................................................. 79
Section 15.7. Taxes on Shares Issued................................. 81
(iv)
Section 15.8. Reservation of Shares to Be Fully Paid; Compliance
with Governmental Requirements; Listing of
Common Stock........................................... 81
Section 15.9. Responsibility of Trustee.............................. 81
Section 15.10. Notice to Holders Prior to Certain Actions............. 82
ARTICLE XVI. REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON
CHANGE IN CONTROL......................................... 83
Section 16.1. Right to Require Repurchase............................ 83
Section 16.2. Notices: Method of Exercising Repurchase Right, Etc.... 84
Section 16.3. Certain Definitions.................................... 86
Section 16.4. Change in Control...................................... 86
Section 16.5. Consolidation, Merger, Etc............................. 87
ARTICLE XVII. MISCELLANEOUS PROVISIONS.................................... 88
Section 17.1. Provisions Binding on Company's Successors............. 88
Section 17.2. Official Acts by Successor Corporation................. 88
Section 17.3. Addresses for Notices, Etc............................. 88
Section 17.4. Governing Law.......................................... 89
Section 17.5. Evidence of Compliance with Conditions Precedent
Certificates to Trustee.............................. 89
Section 17.6. Legal Holidays......................................... 89
Section 17.7. Trust Indenture Act.................................... 90
Section 17.8. No Security Interest Created........................... 90
Section 17.9. Benefits of Indenture.................................. 90
Section 17.10. Table of Contents, Headings, Etc....................... 90
Section 17.11. Authenticating Agent................................... 90
Section 17.12. Execution in Counterparts.............................. 91
(v)
INDENTURE, dated as of September __ 1997, between System Software
Associates, Inc., a Delaware corporation (hereinafter sometimes called the
"Company," as more fully set forth in Section 1.1), and Xxxxxx Trust and Savings
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Bank, as trustee hereunder (hereinafter sometimes called the "Trustee," as more
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fully set forth in Section 1.1).
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W I T N E S S E T H:
WHEREAS, for its lawful corporate purposes, the Company has duly authorized
the issue of its ___% Convertible Subordinated Notes due September 15, 2002
(hereinafter sometimes called the "Securities"), in an aggregate principal
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amount not to exceed $100,000,000 ($115,000,000 if the over-allotment option is
exercised in full) and, to provide the terms and conditions upon which the
Securities are to be authenticated, issued and delivered, the Company has duly
authorized the execution and delivery of this Indenture; and
WHEREAS, the Securities, the certificate of authentication to be borne by
the Securities, a form of assignment, a form of option to elect repurchase upon
a Change in Control (as defined in Section 16.4) and a form of conversion notice
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to be borne by the Securities are to be substantially in the forms hereinafter
provided for; and
WHEREAS, all acts and things necessary to make the Securities, when
executed by the Company and authenticated and delivered by the Trustee or a duly
authorized authenticating agent, as in this Indenture provided, the valid,
binding and legal obligations of the Company, and to constitute these presents a
valid agreement according to its terms, have been done and performed, and the
execution of this Indenture and the issue hereunder of the Securities have in
all respects been duly authorized.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That in order to declare the terms and conditions upon which the Securities
are, and are to be, authenticated, issued and delivered, and in consideration of
the premises and of the purchase and acceptance of the Securities by the holders
thereof, the Company covenants and agrees with the Trustee for the equal and
proportionate benefit of the respective holders from time to time of the
Securities (except as otherwise provided below), as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. The terms defined in this Section 1.1 (except as
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herein otherwise expressly provided or unless the context otherwise requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section 1.1. All other
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terms used in this Indenture that are defined in the Trust Indenture Act or
which are by reference therein defined in the Securities Act (except as herein
otherwise expressly provided or unless the context otherwise requires) shall
have the meanings assigned to such terms in said Trust Indenture Act and in said
Securities Act as in force at the date of the execution of this Indenture. The
words "herein," "hereof," "hereunder," and words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision. The terms defined in this Article include the plural as well as
the singular.
Affiliate: The term "Affiliate" of any specified Person shall mean any
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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
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power to direct or cause the direction of the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
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"controlled" have meanings correlative to the foregoing.
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Board of Directors: The term "Board of Directors" shall mean the Board of
------------------ ------------------
Directors of the Company or a committee of such Board duly authorized to act for
it hereunder.
Business Day: The term "Business Day" means each Monday, Tuesday,
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Wednesday, Thursday and Friday which is not a day on which the banking
institutions in Chicago, Illinois and New York, New York are authorized or
obligated by law or executive order to close or be closed.
Change in Control: The term "Change in Control" shall have the meaning
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specified in Section 16.4.
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Closing Price: The term "Closing Price" shall have the meaning specified
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in Section 15.5(h)(1).
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Commission: The term "Commission" shall mean the Securities and Exchange
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Commission.
Common Stock: The term "Common Stock" shall mean 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.
Subject to the provisions of Section 15.6, however, shares issuable on
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conversion of Securities shall include only shares of the class designated as
common stock of the Company at the date 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
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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
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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: The term "Company" shall mean System Software Associates, Inc., a
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Delaware corporation, and, subject to the provisions of Article XII, shall
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include its successors and assigns.
Controlled: The term "Controlled" shall mean ownership or control of more
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than 50% of the voting power of such entity.
Conversion Price: The term "Conversion Price" shall have the meaning
---------------- ----------------
specified in Section 15.4.
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Corporate Trust Office: The term "Corporate Trust Office" or other similar
---------------------- ----------------------
term shall mean the office of the Trustee at which at any particular time its
corporate trust business shall be principally administered, which office is, at
the date as of which this Indenture is dated, located at 000 Xxxx Xxxxxx Xxxxxx,
00xx Xxxxx, Xxxxxxx, Xxxxxxxx 00000 Attention: Indenture Trust Department,
(System Software Associates, Inc., __% Convertible Subordinated Notes due 2002).
Current Market Price: The term "Current Market Price" shall have the
-------------------- --------------------
meaning specified in Section 15.5(h)(2).
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Custodian: The term "Custodian" shall mean Xxxxxx Trust and Savings Bank,
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as custodian with respect to the Securities in global form, or any successor
entity thereto.
default: The term "default" shall mean any event that is, or after notice
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or passage of time, or both, would be, an Event of Default.
Defaulted Interest: The term "Defaulted Interest" shall have the meaning
------------------ ------------------
specified in Section 2.3.
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Depository: The term "Depository" means, with respect to the Securities
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issuable or issued in whole or in part in global form, the person specified in
Section 2.5 as the Depository with respect to such Securities, until a successor
shall have been appointed and become such pursuant to the applicable provisions
of this Indenture, and thereafter "Depository" shall mean or include such
successor.
Designated Senior Indebtedness: The term "Designated Senior Indebtedness"
------------------------------ ------------------------------
means any particular Senior Indebtedness in which the instrument creating or
evidencing the same or the assumption or guarantee thereof (or related
agreements or documents to which the
-3-
Company is a party) expressly provides that such Senior Indebtedness shall be
"Designated Senior Indebtedness" for purposes of the Indenture (provided that
such instrument, agreement or other document may place limitations and
conditions on the right of such Senior Indebtedness to exercise the rights of
Designated Senior Indebtedness).
Exchange Act: The term "Exchange Act" shall mean the Securities Exchange
------------ ------------
Act of 1934, as amended, and the rules and regulations promulgated thereunder,
as in effect from time to time.
Expiration Time: The term "Expiration Time" shall have the meaning
--------------- ---------------
specified in Section 15.5(f).
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Event of Default: The term "Event of Default" shall mean any event
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specified in Section 7.1(a), (b), (c), (d), (e), (f) or (g).
-------------- --- --- --- --- --- ----
Global Security: The term "Global Security" shall have the meaning
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specified in Section 2.5.
Indebtedness: The term "Indebtedness" means, with respect to any Person,
------------ ------------
and without duplication, (a) the principal of and premium, if any, and interest
on, and fees, costs, enforcement expenses, collateral protection expenses and
other reimbursement or indemnity obligations in respect of all indebtedness or
obligations of the Company to any Person, including, but not limited to, banks
and other lending institutions, for money borrowed that is evidenced by a
Security, bond, Note, loan agreement, or similar instrument or agreement
(including purchase money obligations with original maturities in excess of one
year and noncontingent reimbursement obligations in respect of amounts paid
under letters of credit), (b) all reimbursement obligations and other
liabilities (contingent or otherwise) of such Person with respect to letters of
credit, bank guarantees or bankers' acceptances, (c) all obligations and
liabilities (contingent or otherwise) in respect of leases of such Person
required, in conformity with generally accepted accounting principles, to be
accounted for as capitalized lease obligations on the balance sheet of such
Person and all obligations and other liabilities (contingent or otherwise) under
any lease or related document (including a purchase agreement) in connection
with the lease of real property which provides that such Person is contractually
obligated to purchase or cause a third party to purchase the leased property and
thereby guarantee a minimum residual value of the leased property to the lessor
and the obligations of such Person under such lease or related document to
purchase or to cause a third party to purchase such leased property, (d) all
obligations of such Person (contingent or otherwise) with respect to an interest
rate or other swap, cap or collar agreement or other similar instrument or
agreement or foreign currency hedge, exchange, purchase or similar instrument or
agreement, (e) all direct or indirect guaranties or similar agreements by such
-4-
Person in respect of, and obligations or liabilities (contingent or otherwise)
of such Person to purchase or otherwise acquire or otherwise assure a creditor
against loss in respect of indebtedness, obligations or liabilities of another
Person of the kind described in clauses (a) through (d), (f) any indebtedness or
other obligations described in clauses (a) through (d) secured by any mortgage,
pledge, lien or other encumbrance existing on property which is owned or held by
such Person, regardless of whether the indebtedness or other obligation secured
thereby shall have been assumed by such Person and (g) any and all deferrals,
renewals, extensions and refundings of, or amendments, modifications or
supplements to, any indebtedness, obligation or liability of the kind described
in clauses (a) through (f).
Indenture: The term "Indenture" shall mean this instrument as originally
--------- ---------
executed or, if amended or supplemented as herein provided, as so amended or
supplemented.
Initial Purchasers: The term "Initial Purchasers" means Xxxxxxxxx & Xxxxx
------------------ ------------------
LLC and Lazard Freres & Co. LLC.
New Preferred Stock: The term "New Preferred Stock" shall mean the shares
------------------- -------------------
of Series A Preferred Stock of the Company issuable on or prior to the date
hereof.
New Securities: The term "New Securities" shall have the meaning specified
-------------- --------------
in Section 15.5(d).
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Officers' Certificate: The term "Officers' Certificate," when used with
--------------------- ---------------------
respect to the Company, shall mean a certificate signed by both (a) the
President, the Chief Executive Officer, Executive or Senior Vice President or
any Vice President (whether or not designated by a number or numbers or word or
words added before or after the title "Vice President") and (b) the Treasurer or
any Assistant Treasurer or Secretary or any Assistant Secretary of the Company.
Opinion of Counsel: The term "Opinion of Counsel" shall mean an opinion in
------------------ ------------------
writing signed by legal counsel, who may be an employee of or counsel to the
Company, or other counsel acceptable to the Trustee.
outstanding: The term "outstanding," when used with reference to
----------- -----------
Securities, shall, subject to the provisions of Section 9.4, mean, as of any
-----------
particular time, all Securities authenticated and delivered by the Trustee under
this Indenture, except
(a) Securities theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
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(b) Securities, or portions thereof, for the redemption of which
monies in the necessary amount shall have been deposited in trust with the
Trustee or with any paying agent (other than the Company) or shall have
been set aside and segregated in trust by the Company (if the Company shall
act as its own paying agent); provided that, if such Securities are to be
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redeemed prior to the maturity thereof, notice of such redemption shall
have been given as in Article III provided, or provision satisfactory to
-----------
the Trustee shall have been made for giving such notice;
(c) Securities in lieu of which, or in substitution for which, other
Securities shall have been authenticated and delivered pursuant to the
terms of Section 2.6 unless proof satisfactory to the Trustee is presented
-----------
that any such Securities are held by bona fide holders in due course; and
(d) Securities converted into Common Stock pursuant to Article XV and
----------
Securities deemed not outstanding pursuant to Article III.
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Payment Blockage Notice: The term "Payment Blockage Notice" has the
----------------------- -----------------------
meaning specified in Section 4.2.
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Person: The term "Person" shall mean a corporation, an association, a
------ ------
partnership, an individual, a joint venture, a joint stock company, a limited
liability company, a trust, an unincorporated organization or a government or an
agency or a political subdivision thereof.
Predecessor Security: The term "Predecessor Security" of any particular
-------------------- --------------------
Security shall mean every previous Security evidencing all or a portion of the
same debt as that evidenced by such particular Security and, for the purposes of
this definition, any Security authenticated and delivered under Section 2.6 in
-----------
lieu of a lost, destroyed or stolen Security shall be deemed to evidence the
same debt as the lost, destroyed or stolen Security that it replaces.
Purchased Shares: The term "Purchased Shares" has the meaning specified in
---------------- ----------------
Section 15.5(f).
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Record Date: The term "Record Date" shall have the meaning specified in
----------- -----------
Section 15.5(h)(4).
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Representative: The term "Representative" means the (a) indenture trustee
-------------- --------------
or other trustee, agent or representative for any Senior Indebtedness or (b)
with respect to any Senior Indebtedness that does not have any such trustee,
agent or other representative, (i) in the case of such Senior Indebtedness
issued pursuant to an agreement providing for voting arrangements as among the
holders or owners of such Senior Indebtedness, any holder or owner of such
Senior Indebtedness acting with the consent of the required persons necessary to
bind such holders or owners of such
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Senior Indebtedness and (ii) in the case of all other such Senior Indebtedness,
the holder or owner of such Senior Indebtedness.
Responsible Officer: The term "Responsible Officer," when used with
------------------- -------------------
respect to the Trustee, shall mean an officer of the Trustee in the Corporate
Trust Office assigned and duly authorized by the Trustee to administer the
corporate trust matters hereunder.
Repurchase Date: The term "Repurchase Date" shall have the meaning
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specified in Section 16.1.
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Repurchase Price: The term "Repurchase Price" shall have the meaning
---------------- ----------------
specified in Section 16.1.
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Securities Act: The term "Securities Act" shall mean the Securities Act of
-------------- --------------
1933, as amended, and the rules and regulations promulgated thereunder.
Security or Securities: The terms "Security" or "Securities" shall mean
-------- ---------- -------- ----------
any of the ___% Convertible Subordinated Notes of the Company, due September 15,
2002, authenticated and delivered under this Indenture.
Security register: The term "Security register" shall have the meaning
----------------- -----------------
specified in Section 2.5.
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Securityholder or holder: The terms "Securityholder" or "holder" as
-------------- ------ -------------- ------
applied to any Security, or other similar terms (but excluding the term
"beneficial holder"), shall mean any person in whose name at the time a
particular Security is registered on the Security registrar's books.
Senior Indebtedness: The term "Senior Indebtedness" means the principal
------------------- -------------------
of, premium, if any, interest (including all interest accruing subsequent to the
commencement of any bankruptcy or similar proceeding, whether or not a claim for
post-petition interest is allowable as a claim in any such proceeding) on or in
connection with, and all fees, costs, expenses and other amounts accrued or due
on or in connection with, Indebtedness of the Company, whether outstanding on
the date of this Indenture or thereafter created, incurred, assumed, guaranteed
or in effect guaranteed by the Company (including all deferrals, renewals,
extensions or refundings of, or amendments, modifications or supplements to, the
foregoing), unless in the case of any particular Indebtedness the instrument
creating or evidencing the same or the assumption or guarantee thereof expressly
provides that such Indebtedness shall not be senior in right of payment to the
Securities or expressly provides that such Indebtedness is "pari passu" with or
"junior" to the Securities. Notwithstanding the foregoing, the term Senior
Indebtedness shall not include any Indebtedness of the Company to any Subsidiary
of the Company or amounts payable with respect to New Preferred Stock.
-7-
Significant Subsidiary: The term "Significant Subsidiary" means a
---------------------- ----------------------
corporation or other entity of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the Securities and Exchange Commission.
Subsidiary: The term "Subsidiary" means, with respect to any Person, (i)
---------- ----------
any corporation, association or other business entity of which more than 50% of
the total voting power of shares of capital stock entitled (without regard to
the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or
indirectly, by such Person or one or more Subsidiaries of such Person (or a
combination thereof) and (ii) any partnership (a) the sole general partner or
managing general partner of which is such Person or a Subsidiary of such Person
or (b) the only general partners of which are such Person or one or more
Subsidiaries of such Person (or any combination thereof).
Trading Day: The term "Trading Day" shall have the meaning specified in
----------- -----------
Section 15.5(h)(5).
------------------
Trigger Event: The term "Trigger Event" shall have the meaning specified
------------- -------------
in Section 15.5(d).
---------------
Trust Indenture Act: The term "Trust Indenture Act" shall mean the Trust
------------------- -------------------
Indenture Act of 1939, as amended, as it was in force at the date of execution
of this Indenture, except as provided in Sections 11.3, 15.6 and 16.5; provided,
------------- ---- ---- --------
however, that in the event the Trust Indenture Act of 1939 is amended after the
-------
date hereof, the term "Trust Indenture Act" shall mean, to the extent required
by such amendment, the Trust Indenture Act of 1939 as so amended.
Trustee: The term "Trustee" shall mean Xxxxxx Trust and Savings Bank, and
------- -------
its successors and any corporation resulting from or surviving any consolidation
or merger to which it or its successors may be a party and any successor trustee
at the time serving as successor trustee hereunder.
U.S. Government Obligations: The term "U.S. Government Obligations" means
--------------------------- ---------------------------
direct non-callable obligations of, or non-callable obligations guaranteed by,
the United States of America for the payment of which guarantee or obligation
the full faith and credit of the United States is pledged.
Warrants: The term "Warrants" shall mean the warrants to purchase shares
-------- --------
of Common Stock issued to the holders of the New Preferred Stock.
The definitions of certain other terms are as specified in Article XV and
----------
Article XVI.
-----------
-8-
ARTICLE II
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION
AND EXCHANGE OF SECURITIES
Section 2.1. Designation, Amount and Issue of Securities. The Securities
-------------------------------------------
shall be designated as "__% Convertible Subordinated Notes due 2002."
Securities not to exceed the aggregate principal amount of $100,000,000 (or
$115,000,000 if the over-allotment option set forth in Section 3 of the
Underwriting Agreement, dated September __, 1997 (as amended from time to time
by the parties thereto) by and between the Company and the Initial Purchasers is
exercised in full) upon the execution of this Indenture, or (except pursuant to
Sections 2.5, 2.6, 3.3, 15.2 and 16.2 hereof) from time to time thereafter, may
------------ ---- ---- ----- ----
be executed by the Company and delivered to the Trustee for authentication, and
the Trustee shall thereupon authenticate and deliver said Securities to or upon
the written order of the Company, signed by its (a) President, Executive or
Senior Vice President or any Vice President (whether or not designated by a
number or numbers or word or words added before or after the title "Vice
President") and (b) Treasurer or Assistant Treasurer or its Secretary or any
Assistant Secretary, without any further action by the Company hereunder.
Section 2.2. Form of Note. The Securities and the Trustee's certificate of
------------
authentication to be borne by such Securities shall be substantially in the form
set forth in Exhibit A, which is incorporated in and made a part of this
---------
Indenture.
Any of the Securities may have such letters, numbers or other marks of
identification and such notations, legends and endorsements as the officers
executing the same may approve (execution thereof to be conclusive evidence of
such approval) and as are not inconsistent with the provisions of this
Indenture, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
securities exchange or automated quotation system on which the Securities may be
listed, or to conform to usage.
Any Security in global form shall represent such of the outstanding
Securities as shall be specified therein and 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 increased or reduced to reflect
transfers or exchanges permitted hereby. Any endorsement of a Security in
global form to reflect the amount of any increase or decrease in the amount of
outstanding Securities represented thereby shall be made by the Trustee or the
Custodian, at the direction of the Trustee, in such manner and upon instructions
given by the holder of such Securities in accordance with this Indenture.
Payment of
-9-
principal of and interest and premium, if any, on any Security in global form
shall be made to the holder of such Security.
The terms and provisions contained in the Form of Note attached as Exhibit
-------
A hereto shall constitute, and are hereby expressly made, a part of this
-
Indenture and, to the extent applicable, the Company and the Trustee, by their
execution and delivery of this Indenture, expressly agree to such terms and
provisions and to be bound thereby.
Neither the Company nor the Trustee shall have any responsibility for any
defect in the CUSIP number that appears on any Security, check, advice of
payment or redemption notice, and any such document may contain a statement to
the effect that CUSIP numbers have been assigned by an independent service for
convenience of reference and that neither the Company nor the Trustee shall be
liable for any inaccuracy in such numbers.
Section 2.3 Date and Denomination of Securities Payments of Interest. The
--------------------------------------------------------
Securities shall be issuable in registered form without coupons in denominations
of $1,000 principal amount and integral multiples thereof. Every Security shall
be dated the date of its authentication and shall bear interest from the
applicable date in each case as specified on the face of the Form of Note
attached as Exhibit A hereto. Interest on Securities shall be paid in arrears
---------
on each March 15 and September 15 commencing March 15, 1998 and ending on March
15, 2002, unless redeemed, repurchased or converted earlier pursuant to the
terms of this Indenture. Interest on the Securities shall be computed on the
basis of a 360-day year comprised of twelve 30-day months.
The person in whose name any Security (or its Predecessor Security) is
registered at the close of business on any record date with respect to any
interest payment date (including any Security that is converted after the record
date and on or before the interest payment date) shall be entitled to receive
the interest payable on such interest payment date notwithstanding the
cancellation of such Security upon any transfer, exchange or conversion
subsequent to the record date and on or prior to such interest payment date;
provided, that in the case of any Security, or portion thereof, called for
--------
redemption on a redemption date or repurchased in connection with a Change in
Control on a Repurchase Date that is after a record date and prior to (but
excluding) the next succeeding interest payment date, interest shall not be paid
to the person in whose name the Security, or portion thereof, is registered on
the close of business on such record date and the Company shall have no
obligation to pay interest on such Security or such portion except to the extent
required to be paid upon redemption or repurchase of such Security or portion
thereof pursuant to Section 3.3 or 16.1 hereof. Interest may, at the option of
----------- ----
the Company, be paid by check mailed to the address of such person on the
Security register; provided that, with respect to any holder of Securities with
--------
an aggregate principal amount
-10-
equal to or in excess of $5,000,000 at the request of such holder in writing to
the Company at least five (5) days prior to the date set for payment of interest
(who shall then furnish written notice to such effect to the Trustee), interest
on such holder's Securities shall be paid by wire transfer in immediately
available funds in accordance with the wire transfer instructions supplied by
such holder to the Trustee and paying agent (if different from the Trustee). The
term "interest payment date" shall mean March 15 and September 15 of each year
commencing on March 15, 1998. The term "record date" with respect to any
interest payment date shall mean the March 1 or September 1 preceding said March
15 or September 15, respectively.
Any interest on any Security which is payable, but is not punctually paid
or duly provided for, on any said March 15 or September 15 (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Securityholder
-------------------
on the relevant record date by virtue of his having been such Securityholder and
such Defaulted Interest shall be paid by the Company, at its election in each
case, as provided in clause (1) or (2) below.
(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on a
special record date for the payment of such Defaulted Interest, which shall
be fixed in the following manner. The Company shall notify the Trustee in
writing of the amount of Defaulted Interest to be paid on each Security and
the date of the payment (which shall be not less than twenty-five (25) days
after the receipt by the Trustee of such notice, unless the Trustee shall
consent to an earlier date), and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount to be
paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon the Trustee shall fix a special record date for
the payment of such Defaulted Interest which shall be not more than fifteen
(15) days and not less than ten (10) days prior to the date of the proposed
payment and not less than ten (10) days after the receipt by the Trustee of
the notice of the proposed payment. The Trustee shall promptly notify the
Company of such special record date and, in the name and at the expense of
the Company, shall cause notice of the proposed payment of such Defaulted
Interest and the special record date therefor to be mailed, first-class
postage prepaid, to each Securityholder at his address as it appears in the
Security register, not less than ten (10) days prior to such special record
date. Notice of the proposed payment of such Defaulted Interest and the
special record date therefor having been so mailed, such Defaulted Interest
-11-
shall be paid to the Persons in whose names the Securities (or their
respective Predecessor Securities) were registered at the close of business
on such special record date and shall no longer be payable pursuant to the
following clause (2).
(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange and automated quotation system on which the Securities
may be listed or designated for listing, and upon such notice as may be
required by such exchange and automated quotation system, if, after notice
given by the Company to the Trustee of the proposed payment pursuant to
this clause, such manner of payment shall be deemed practicable by the
Trustee.
Section 2.4. Execution of Securities. The Securities shall be signed in
-----------------------
the name and on behalf of the Company by the facsimile signature of its
President, any Executive or Senior Vice President or any Vice President (whether
or not designated by a number or numbers or word or words added before or after
the title "Vice President") and attested by the facsimile signature of its
--------------
Treasurer or Assistant Treasurer or its Secretary or any of its Assistant
Secretaries (which may be printed, engraved or otherwise reproduced thereon, by
facsimile or otherwise). Only such Securities as shall bear thereon a
certificate of authentication substantially in the form set forth on the Form of
Note attached as Exhibit A hereto, manually executed by the Trustee (or an
---------
authenticating agent appointed by the Trustee as provided by Section 17.11),
-------------
shall be entitled to the benefits of this Indenture or be valid or obligatory
for any purpose. Such certificate by the Trustee (or such an authenticating
agent) upon any Security executed by the Company shall be conclusive evidence
that the Security so authenticated has been duly authenticated and delivered
hereunder and that the holder is entitled to the benefits of this Indenture.
In case any officer of the Company who shall have signed any of the
Securities shall cease to be such officer before the Securities so signed shall
have been authenticated and delivered by the Trustee, or disposed of by the
Company, such Securities nevertheless may be authenticated and delivered or
disposed of as though the person who signed such Securities had not ceased to be
such officer of the Company and any Security may be signed on behalf of the
Company by such persons as, at the actual date of the execution of such
Security, shall be the proper officers of the Company, although at the date of
the execution of this Indenture any such person was not such an officer.
Section 2.5. Exchange and Registration of Transfer of Securities;
----------------------------------------------------
Depository. The Company shall cause to be kept at the Corporate Trust Office a
----------
register (the register maintained in such office and in any other office or
agency of the Company designated pursuant to Section 5.2 being herein
-----------
sometimes
-12-
collectively referred to as the "Security register") in which, subject to such
-----------------
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Security
register shall be in written form or in any form capable of being converted into
written form within a reasonably prompt period of time. The Trustee is hereby
appointed "Security registrar" for the purpose of registering Securities and
------------------
transfers of Securities as herein provided. The Company may appoint one or more
co-registrars in accordance with Section 5.2.
-----------
Upon surrender for registration of transfer of any Security to the
Security registrar or any co-registrar, and satisfaction of the requirements for
such transfer set forth in this Section 2.5, 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 denominations and
of a like aggregate principal amount.
Securities may be exchanged for other Securities of any authorized
denominations and of a like aggregate principal amount, upon surrender of the
Securities to be exchanged at any such office or agency maintained by the
Company pursuant to Section 5.2. Whenever any Securities are so surrendered for
-----------
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Securityholder making the exchange is entitled
to receive bearing registration numbers not contemporaneously outstanding.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
All Securities presented or surrendered for registration of transfer or for
exchange, redemption, repurchase or conversion shall (if so required by the
Company or the Security registrar) be duly endorsed, or be accompanied by a
written instrument or instruments of transfer in form satisfactory to the
Company and the Trustee, and the Securities shall be duly executed by the
Securityholder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax, assessment or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities.
Neither the Company nor the Trustee nor any Security registrar nor any
co-registrar shall be required to exchange or register a transfer of (a) any
Securities for a period of fifteen (15) days next preceding any selection of
Securities to be redeemed or (b) any Securities or portions thereof called for
redemption
-13-
pursuant to Article III or (c) any Securities or portion thereof surrendered for
-----------
conversion pursuant to Article XV.
So long as the Securities are eligible for book-entry settlement with the
Depository the Securities shall be represented by a Security in global form and
registered in the name of the Depository or the nominee of the Depository (the
"Global Security"). The transfer and exchange of beneficial interests in the
---------------
Global Security, which does not involve the issuance of a Security in
certificated form, shall be effected through the Depository, in accordance with
this Indenture and the procedures of the Depository therefor.
At any time at the request of the beneficial holder of an interest in the
Global Security to obtain a Security in certificated form, such beneficial
holder shall be entitled to obtain a Security in certificated form upon written
request to the Trustee and the Custodian in accordance with the standing
instructions and procedures existing between the Custodian and Depository for
the issuance thereof. Upon receipt of any such request, the Trustee, or the
Custodian at the direction of the Trustee, will cause, in accordance with the
standing instructions and procedures existing between the Depository and the
Custodian, the aggregate principal amount of the Security to be reduced by the
principal amount of the Security in certificated form issued upon such request
to such beneficial holder and, following such reduction, the Company will
execute and the Trustee will authenticate and deliver to such beneficial holder
(or its nominee) a Security or Securities in certificated form in the
appropriate aggregate principal amount in the name of such beneficial holder (or
its nominee) and bearing such restrictive legends as may be required by this
Indenture.
Any transfer of a beneficial interest in the Global Security which cannot
be effected through book-entry settlement must be effected by the delivery to
the transferee (or its nominee) of a Security or Securities in certificated form
registered in the name of the transferee (or its nominee) on the books
maintained by the Security registrar. With respect to any such transfer, the
Trustee, or the Custodian at the direction of the Trustee, will cause, in
accordance with the standing instructions and procedures existing between the
Depository and the Custodian, the aggregate principal amount of the Global
Security to be reduced by the principal amount of the respective beneficial
interest in the Global Security being transferred and, following such reduction,
the Company will execute and the Trustee will authenticate and deliver to the
transferee (or such transferee's nominee, as the case may be), a Security or
Securities in certificated form in the appropriate aggregate principal amount in
the name of such transferee (or its nominee).
Any Global Security may be endorsed with or have incorporated in the text
thereof such legends or recitals or changes not inconsistent with the provisions
of this Indenture as may be
-14-
required by the Custodian, the Depository or with the rules and regulations of
any securities exchange or automated quotation system upon which the Securities
may be listed or traded or to conform with any usage with respect thereto, or to
indicate any special limitations or restrictions to which any particular
Securities are subject.
Notwithstanding any other provisions of this Indenture, a Global Security
may not be transferred as a whole or in part except by the Depository to a
nominee of the Depository or by a nominee of the Depository to the Depository or
another nominee of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
The Depository shall be a clearing agency registered under the Exchange
Act. The Company initially appoints The Depository Trust Company to act as
Depository with respect to the Global Security. Initially, the Global Security
shall be issued to the Depository, registered in the name of Cede & Co., as the
nominee of the Depository, and deposited with the Custodian for Cede & Co.
The Trustee is hereby authorized and requested to execute and deliver a
Letter of Representation to the Depository and, in connection with any successor
nominee for the Depository or any successor Depository, enter into comparable
arrangements, and shall have the same rights with respect to its actions
thereunder as it has with respect to its actions under this Indenture.
If at any time the Depository for the Global Security notifies the Company
that it is unwilling or unable to continue as Depository for the Security, the
Company may appoint a successor Depository with respect to such Security. If a
successor Depository is not appointed by the Company within ninety (90) days
after the Company receives such notice, the Company will execute, and the
Trustee, upon receipt of an Officers' Certificate for the authentication and
delivery of Securities, will authenticate and deliver, Securities in
certificated form, in an aggregate principal amount equal to the principal
amount of the Global Security, in exchange for the Global Security.
If a Security in certificated form is issued in exchange for any portion of
a Global Security after the close of business at the office or agency where such
exchange occurs on any Record Date and before the opening of business at such
office or agency on the next succeeding Interest Payment Date, interest will not
be payable on such Interest Payment Date in respect of such Security, but will
be payable on such Interest Payment Date only to the person to whom interest in
respect of such portion of such Global Security is payable in accordance with
the provisions of this Indenture.
Securities in certificated form issued in exchange for all or a part of a
Global Security pursuant to this Section 2.5 shall be registered in such names
and in such authorized denominations as the Depository, pursuant to instructions
from its direct or
-15-
indirect participants or otherwise, shall instruct the Trustee in writing. Upon
execution and authentication, the Trustee shall deliver such Securities in
certificated form to the persons in whose names such Securities in certificated
form are so registered.
At such time as all interests in a Global Security have been redeemed,
repurchased, converted, canceled, exchanged for Securities in certificated form,
or transferred to a transferee who receives Securities in certificated form,
such Global Security shall, upon receipt thereof, be canceled by the Trustee in
accordance with standing procedures and instructions existing between the
Depository and the Custodian. At any time prior to such cancellation, if any
interest in a Global Security is exchanged for Securities in certificated form,
redeemed, converted, repurchased or canceled, or transferred to a transferee who
receives Securities in certificated form therefor or any Security in
certificated form is exchanged or transferred for part of a Global Security, the
principal amount of such Global Security shall, in accordance with the standing
procedures and instructions existing between the Depository and the Custodian,
be appropriately reduced or increased, as the case may be, and an endorsement
shall be made on such Global Security, by the Trustee or the Custodian, at the
direction of the Trustee, to reflect such reduction or increase.
Section 2.6. Mutilated, Destroyed, Lost or Stolen Securities. In case any
-----------------------------------------------
Security shall become mutilated or be destroyed, lost or stolen, the Company in
its discretion may execute, and upon its written request the Trustee or an
authenticating agent appointed by the Trustee shall authenticate and deliver, a
new Security, bearing a number not contemporaneously outstanding, in exchange
and substitution for the mutilated Security, or in lieu of and in substitution
for the Security so destroyed, lost or stolen. In every case the applicant for a
substituted Security shall furnish to the Company, to the Trustee and, if
applicable, to such authenticating agent such security or indemnity as may be
required by them to save each of them harmless for any loss, liability, cost or
expense caused by or connected with such substitution, and, in every case of
destruction, loss or theft, the applicant also shall furnish to the Company, to
the Trustee and, if applicable, to such authenticating agent evidence to their
satisfaction of the destruction, loss or theft of such Security and of the
ownership thereof.
The Trustee or such authenticating agent may authenticate any such
substituted Security and deliver the same upon the receipt of such security or
indemnity as the Trustee, the Company and, if applicable, such authenticating
agent may require. Upon the issuance of any substituted Security, 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 connected therewith. In case any Security which has matured or is about
to mature or has been called for redemption or
-16-
is about to be converted into Common Stock shall become mutilated or be
destroyed, lost or stolen, the Company may, instead of issuing a substitute
Security, pay or authorize the payment of or convert or authorize the conversion
of the same (without surrender thereof except in the case of a mutilated
Security), as the case may be, if the applicant for such payment or conversion
shall furnish to the Company, to the Trustee and, if applicable, to such
authenticating agent such security or indemnity as may be required by them to
save each of them harmless for any loss, liability, cost or expense caused by or
connected with such substitution, and, in case of destruction, loss or theft,
evidence satisfactory to the Company, the Trustee and, if applicable, any paying
agent or conversion agent of the destruction, loss or theft of such Security and
of the ownership thereof.
Every substitute Security issued pursuant to the provisions of this Section
-------
2.6 by virtue of the fact that any Security is destroyed, lost or stolen shall
---
constitute an additional contractual obligation of the Company, whether or not
the destroyed, lost or stolen Security shall be found at any time, and shall be
entitled to all the benefits of (but shall be subject to all the limitations set
forth in) this Indenture equally and proportionately with any and all other
Securities duly issued hereunder. To the extent permitted by law, all Securities
shall be held and owned upon the express condition that the foregoing provisions
are exclusive with respect to the replacement or payment or conversion of
mutilated, destroyed, lost or stolen Securities and shall preclude any and all
other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement or payment or
conversion of negotiable instruments or other securities without their
surrender.
Section 2.7. Temporary Securities. Pending the preparation of Securities
--------------------
in certificated form, the Company may execute and the Trustee or an
authenticating agent appointed by the Trustee shall, upon the written request of
the Company, authenticate and deliver temporary Securities (printed, typewritten
or lithographed). Temporary Securities shall be issuable in any authorized
denomination, and substantially in the form of the Securities in certificated
form, but with such omissions, insertions and variations as may be appropriate
for temporary Securities, all as may be determined by the Company. Every such
temporary Security shall be executed by the Company and authenticated by the
Trustee or such authenticating agent upon the same conditions and in
substantially the same manner, and with the same effect, as the Securities in
certificated form. Without unreasonable delay the Company will execute and
deliver to the Trustee or such authenticating agent Securities in certificated
form (other than in the case of Securities in global form) and thereupon any or
all temporary Securities (other than in the case of Securities in global form)
may be surrendered in exchange therefor, at each office or agency maintained by
the Company pursuant to Section 5.2 and the Trustee or such
-----------
-17-
authenticating agent shall authenticate and deliver in exchange for such
temporary Securities an equal aggregate principal amount of Securities in
certificated form. Such exchange shall be made by the Company at its own expense
and without any charge therefor. Until so exchanged, the temporary Securities
shall in all respects be entitled to the same benefits and subject to the same
limitations under this Indenture as Securities in certificated form
authenticated and delivered hereunder.
Section 2.8. Cancellation of Securities Paid, Etc. All Securities
surrendered for the purpose of payment, redemption, repurchase, conversion,
exchange or registration of transfer, shall, if surrendered to the Company or
any paying agent or any Security registrar or any conversion agent, be
surrendered to the Trustee and promptly canceled by it, or, if surrendered to
the Trustee, shall be promptly canceled by it, and no Securities shall be issued
in lieu thereof except as expressly permitted by any of the provisions of this
Indenture; provided that, any Security or portion thereof surrendered for
--------
repurchase shall only be canceled at such time as such Security or portion
thereof has been repurchased pursuant to Article XVI hereof. The Trustee shall
-----------
destroy canceled Securities (unless the Company directs it to do otherwise) and,
after such destruction, shall, if requested by the Company, deliver a
certificate of such destruction to the Company. 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 and until
the same are delivered to the Trustee for cancellation.
ARTICLE III
REDEMPTION OF SECURITIES
Section 3.1. Redemption Prices. The Company may not redeem the Securities
-----------------
prior to September 20, 2000. At any time on or after September 20, 2000, the
Company may, at its option from time to time, redeem all or any part of the
Securities on any date prior to maturity, upon notice as set forth in Section
-------
3.2, and at the optional redemption prices set forth in the Form of Note
---
attached as Exhibit A hereto, together with accrued interest to, but excluding,
---------
the date fixed for redemption.
Section 3.2. Notice of Redemption; Selection of Securities. In case the
---------------------------------------------
Company shall desire to exercise the right to redeem all or, as the case may be,
any part of the Securities pursuant to Section 3.1, it shall fix a date for
-----------
redemption and it or, at its request, the Trustee in the name of and at the
expense of the Company, shall mail or cause to be mailed a notice of such
redemption at least fifteen (15) and not more than sixty (60) days prior to the
date fixed for redemption to the holders of Securities so to be redeemed as a
whole or in part at their last addresses as the same appear on the Security
register (provided that if the Company shall give such notice, it shall also
--------
give
-18-
written notice, and written notice of the Securities to be redeemed, to the
Trustee). Such mailing shall be by first class mail. The notice if mailed in the
manner herein provided shall be conclusively presumed to have been duly given,
whether or not the holder receives such notice. In any case, failure to give
such notice by mail or any defect in the notice to the holder of any Security
designated for redemption as a whole or in part shall not affect the validity of
the proceedings for the redemption of any other Security.
Each such notice of redemption shall specify the aggregate principal amount
of Securities to be redeemed, the date fixed for redemption, the redemption
price at which Securities are to be redeemed, the place or places of payment,
that payment will be made upon presentation and surrender of such Securities,
that interest accrued to, but excluding, the date fixed for redemption will be
paid as specified in said notice, and that on and after said date interest
thereon or on the portion thereof to be redeemed will cease to accrue. Such
notice shall also state the current Conversion Price and the date on which the
right to convert such Securities or portions thereof into Common Stock will
expire. If fewer than all the Securities are to be redeemed, the notice of
redemption shall identify the Securities to be redeemed. In case any Security is
to be redeemed in part only, the notice of redemption shall state the portion of
the principal amount thereof to be redeemed and shall state that on and after
the date fixed for redemption, upon surrender of such Security, a new Security
or Securities in principal amount equal to the unredeemed portion thereof will
be issued.
On or prior to the redemption date specified in the notice of redemption
given as provided in this Section 3.2, the Company will deposit with the Trustee
-----------
or with one or more paying agents (or, if the Company is acting as its own
paying agent, set aside, segregate and hold in trust as provided in Section 5.4)
-----------
an amount of money sufficient to redeem on the redemption date all the
Securities (or portions thereof) so called for redemption (other than those
theretofore surrendered for conversion into Common Stock) at the appropriate
redemption price, together with accrued interest to, but excluding, the date
fixed for redemption; provided that, if such payment is made on the redemption
--------
date it must be received by the Trustee or paying agent, as the case may be, by
10:00 a.m. Chicago time, on such date. If any Security called for redemption is
converted pursuant hereto, any money deposited with the Trustee or any paying
agent or so segregated and held in trust for the redemption of such Security
shall be paid to the Company upon its written request, or, if then held by the
Company, shall be discharged from such trust. If fewer than all the Securities
are to be redeemed, the Company will give the Trustee written notice in the form
of an Officers' Certificate not fewer than forty-five (45) days (or such shorter
period of time as may be acceptable to the Trustee) prior to the redemption date
as to the aggregate principal amount of Securities to be redeemed.
-19-
If fewer than all the Securities are to be redeemed, the Trustee shall
select the Securities or portions thereof to be redeemed (in principal amounts
of $1,000 or integral multiples thereof) by lot or, in its discretion, on a pro
rata basis with such adjustments up to $1,000 in order to retain the minimum
denominations of the Securities. If any Security selected for partial redemption
is converted in part after such selection, the converted portion of such
Security shall be deemed (so far as may be) to be the portion to be selected for
redemption. The Securities (or portions thereof) so selected shall be deemed
duly selected for redemption for all purposes hereof, notwithstanding that any
such Security is converted as a whole or in part before the mailing of the
notice of redemption.
Upon any redemption of less than all Securities, the Company and the
Trustee may (but need not) treat as outstanding any Securities surrendered for
conversion during the period of fifteen (15) days next preceding the mailing of
a notice of redemption and may (but need not) treat as outstanding any Security
authenticated and delivered during such period in exchange for the unconverted
portion of any Security converted in part during such period.
Section 3.3. Payment of Securities Called for Redemption. If notice of
-------------------------------------------
redemption has been given as above provided, the Securities or portion of
Securities with respect to which such notice has been given shall, unless
converted into Common Stock pursuant to the terms hereof, become due and payable
on the date and at the place or places stated in such notice at the applicable
redemption price, together with interest accrued to (but excluding) the date
fixed for redemption, and on and after said date (unless the Company shall
default in the payment of such Securities at the redemption price, together with
interest accrued to said date) interest on the Securities or portion of
Securities so called for redemption shall cease to accrue and such Securities
shall cease after the close of business on the Business Day immediately
preceding the date fixed for redemption to be convertible into Common Stock and,
except as provided in Sections 8.5 and 13.4, to be entitled to any benefit or
------------ ----
security under this Indenture, and the holders thereof shall have no right in
respect of such Securities except the right to receive the redemption price
thereof and unpaid interest to (but excluding) the date fixed for redemption. On
presentation and surrender of such Securities at a place of payment in said
notice specified, the said Securities or the specified portions thereof shall be
paid and redeemed by the Company at the applicable redemption price, together
with interest accrued thereon to (but excluding) the date fixed for redemption;
provided that, if the applicable redemption date is an interest payment date,
--------
the semi-annual payment of interest becoming due on such date shall be payable
to the holders of such Securities registered as such on the relevant record date
instead of the holders surrendering such Securities for redemption on such
date.
-20-
Upon presentation of any Security redeemed in part only, 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 unredeemed portion of the
Securities so presented.
Notwithstanding the foregoing, the Trustee shall not pay the redemption
price of any Securities or mail any notice of optional redemption during the
continuance of a default in payment of interest or premium on the Securities or
of any Event of Default of which, in the case of any Event of Default other than
under Sections 7.1(a) or 7.1(b), a Responsible Officer of the Trustee has
--------------- ------
knowledge. 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 or duly provided for, bear interest from the date fixed for
redemption at the rate borne by the Security and such Security shall remain
convertible into Common Stock until the principal and premium, if any, shall
have been paid or duly provided for.
Section 3.4. Conversion Arrangement on Call for Redemption. In connection
---------------------------------------------
with any redemption of Securities, the Company may arrange for the purchase and
conversion of any Securities by an agreement with one or more investment bankers
or other purchasers to purchase such Securities by paying to the Trustee in
trust for the Securityholders, on or before the date fixed for redemption, an
amount not less than the applicable redemption price, together with interest
accrued to (but excluding) the date fixed for redemption, of such Securities.
Notwithstanding anything to the contrary contained in this Article III, the
-----------
obligation of the Company to pay the redemption price of such Securities,
together with interest accrued to (but excluding) the date fixed for redemption,
shall be deemed to be satisfied and discharged to the extent such amount is so
paid by such purchasers. If such an agreement is entered into (a copy of which
shall be filed with the Trustee prior to the date fixed for redemption), any
Securities not duly surrendered for conversion by the holders thereof may, at
the option of the Company, be deemed, to the fullest extent permitted by law,
acquired by such purchasers from such holders and (notwithstanding anything to
the contrary contained in Article XV) surrendered by such purchasers for
----------
conversion, all as of immediately prior to the close of business on the date
fixed for redemption (and the right to convert any such Securities shall be
extended through such time), subject to payment of the above amount as
aforesaid. At the written direction of the Company, the Trustee shall hold and
dispose of any such amount paid to it in the same manner as it would monies
deposited with it by the Company for the redemption of Securities. Without the
Trustee's prior written consent, no arrangement between the Company and such
purchasers for the purchase and conversion of any Securities shall increase or
otherwise affect any of the powers, duties, responsibilities or obligations of
the Trustee as set forth in this Indenture, and
-21-
the Company agrees to indemnify the Trustee from, and hold it harmless against,
any loss, liability or expense arising out of or in connection with any such
arrangement for the purchase and conversion of any Securities between the
Company and such purchasers to which the Trustee has not consented in writing,
including the costs and expenses, including reasonable legal fees, incurred by
the Trustee in the defense of any claim or liability arising out of or in
connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
ARTICLE IV.
SUBORDINATION OF SECURITIES
Section 4.1. Agreement of Subordination. The Company covenants and
--------------------------
agrees, and each holder of Securities issued hereunder by his acceptance thereof
likewise covenants and agrees, that all Securities shall be issued subject to
the provisions of this Article IV and each Person holding any Security, whether
----------
upon original issue or upon transfer, assignment or exchange thereof, accepts
and agrees to be bound by such provisions.
The payment of the principal of, premium, if any, and interest on all
Securities (including, but not limited to, the redemption price with respect to
the Securities called for redemption in accordance with Section 3.2 or submitted
-----------
for repurchase in accordance with Section 16.2, as the case may be, as provided
------------
in the Indenture) issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and subject in right of payment to the
prior payment in full of all Senior Indebtedness, whether outstanding at the
date of this Indenture or thereafter incurred.
No provision of this Article IV shall prevent the occurrence of any default
----------
or Event of Default hereunder.
Section 4.2. Payments to Securityholders. No payment shall be made with
---------------------------
respect to the principal of, or premium, if any, or interest on the Securities
(including, but not limited to, the redemption price with respect to the
Securities to be called for redemption in accordance with Section 3.2 or
-----------
submitted for repurchase in accordance with Section 16.2, as the case may be, as
------------
provided in the Indenture), except payments and distributions made by the
Trustee as permitted by the first or second paragraph of Section 4.5, if:
-----------
(1) a default in the payment of principal, premium, interest, rent or
other obligations due on any Senior Indebtedness occurs and is continuing
(or, in the case of Senior Indebtedness for which there is a period of
grace, in the event of such a default that continues beyond the period of
grace, if any, specified in the instrument or lease
-22-
evidencing such Senior Indebtedness), unless and until such default shall
have been cured or waived or shall have ceased to exist; or
(2) a default, other than a payment default, on any Designated Senior
Indebtedness occurs and is continuing that then permits holders of such
Designated Senior Indebtedness to accelerate its maturity and the Trustee
receives a written notice of the default (a "Payment Blockage Notice") from
-----------------------
a Representative or the Company.
If the Trustee receives any Payment Blockage Notice pursuant to clause
(2) above, no subsequent Payment Blockage Notice shall be effective for purposes
of this Section unless and until (A) at least 365 days shall have elapsed since
the initial effectiveness of the immediately prior Payment Blockage Notice, and
(B) all scheduled payments of principal, premium, if any, and interest on the
Securities that have come due have been paid in full in cash. No nonpayment
default that existed or was continuing on the date of delivery of any Payment
Blockage Notice to the Trustee shall be, or be made, the basis for a subsequent
Payment Blockage Notice.
The Company may and shall resume payments on and distributions in
respect of the Securities upon the earlier of:
(3) the date upon which the default is cured or waived or ceases to
exist, or
(4) in the case of a default referred to in clause (2) above, 179
days pass after notice is received if the maturity of such Designated
Senior Indebtedness has not been accelerated,
unless this Article IV otherwise prohibits the payment or distribution at the
----------
time of such payment or distribution.
Upon any payment by the Company, or distribution of assets of the Company
of any kind or character, whether in cash, property or securities, to creditors
upon any dissolution or winding up or liquidation or reorganization of the
Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become due upon all
Senior Indebtedness shall first be paid in full in cash or other payment
satisfactory to the holders of such Senior Indebtedness, or payment thereof in
accordance with its terms provided for in cash or other payment satisfactory to
the holders of such Senior Indebtedness, before any payment is made on account
of the principal of, premium, if any, or interest on the Securities (except
payments made pursuant to Article XIII from monies deposited with the Trustee
------------
pursuant thereto prior to commencement of proceedings for such dissolution,
winding up, liquidation or reorganization) and upon any such dissolution or
winding up or liquidation or reorganization of the Company or bankruptcy,
insolvency, receivership or other
-23-
proceeding, any payment by the Company, or distribution of assets of the Company
of any kind or character, whether in cash, property or securities, to which the
holders of the Securities or the Trustee would be entitled, except for the
provision of this Article IV, shall (except as aforesaid) be paid by the Company
----------
or by any receiver, trustee in bankruptcy, liquidating trustee, agent or other
Person making such payment or distribution, or by the holders of the Securities
or by the Trustee under this Indenture if received by them or it, directly to
the holders of Senior Indebtedness (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders, or as otherwise
required by law or a court order) or their representative or representatives, or
to the trustee or trustees under any indenture pursuant to which any instruments
evidencing any Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all Senior Indebtedness in
full, in cash or other payment satisfactory to the holders of such Senior
Indebtedness, after giving effect to any concurrent payment or distribution to
or for the holders of Senior Indebtedness, before any payment or distribution or
provision therefor is made to the holders of the Securities or to the Trustee.
For purposes of this Article IV, the words, "cash, property or securities"
----------
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment, the payment of which is
subordinated at least to the extent provided in this Article IV with respect to
----------
the Securities to the payment of all Senior Indebtedness which may at the time
be outstanding; provided that, (i) the Senior Indebtedness is assumed by the new
-------- ----
corporation, if any, resulting from any reorganization or readjustment, and (ii)
the rights of the holders of Senior Indebtedness (other than leases which are
not assumed by the Company or the new corporation, as the case may be) are not,
without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Company with, or the merger of the
Company into, another corporation or the liquidation or dissolution of the
Company following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article XII shall not be deemed a dissolution,
-----------
winding up, liquidation or reorganization for the purposes of this Section 4.2
-----------
if such other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article XII.
-----------
In the event of the acceleration of the Securities because of an Event of
Default, no payment or distribution shall be made to the Trustee or any holder
of Securities in respect of the principal of, premium, if any, or interest on
the Securities (including, but not limited to, the redemption price with respect
to the Securities called for redemption in accordance with Section 3.2 or
-----------
submitted for repurchase in accordance with Section 16.2, as the case may be,
------------
-24-
as provided in the Indenture), except payments and distributions made by the
Trustee as permitted by the first or second paragraph of Section 4.5, until all
-----------
Senior Indebtedness has been paid in full in cash or other payment satisfactory
to the holders of Senior Indebtedness or such acceleration is rescinded in
accordance with the terms of this Indenture. If payment of the Securities is
accelerated because of an Event of Default, the Company shall promptly notify
holders of Senior Indebtedness of the acceleration unless there are no payment
obligations of the Company thereunder and all obligations thereunder to extend
credit have been terminated or expired.
In the event that, notwithstanding the foregoing provisions, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities (including, without limitation, by way of setoff or
otherwise), prohibited by the foregoing, shall be received by the Trustee or the
holders of the Securities before all Senior Indebtedness is paid in full in cash
or other payment satisfactory to the holders of such Senior Indebtedness, or
provision is made for such payment thereof in accordance with its terms in cash
or other payment satisfactory to the holders of such Senior Indebtedness, such
payment or distribution shall be held in trust for the benefit of and shall be
paid over or delivered to the holders of Senior Indebtedness or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, as calculated by
the Company, for application to the payment of all Senior Indebtedness remaining
unpaid to the extent necessary to pay all Senior Indebtedness in full in cash or
other payment satisfactory to the holders of such Senior Indebtedness, after
giving effect to any concurrent payment or distribution to or for the holders of
such Senior Indebtedness.
Nothing in this Section 4.2 shall apply to claims of, or payments to, the
-----------
Trustee under or pursuant to Section 8.6. This Section 4.2 shall be subject to
----------- -----------
the further provisions of Section 4.5, and the right to rescind and annul
-----------
acceleration of the notice pursuant to Section 7.1.
-----------
Section 4.3. Subrogation of Securities. Subject to the payment in full of
-------------------------
all Senior Indebtedness, the rights of the holders of the Securities shall be
subrogated to the extent of the payments or distributions made to the holders of
such Senior Indebtedness pursuant to the provisions of this Article IV (equally
----------
and ratably with the holders of all indebtedness of the Company which by its
express terms is subordinated to other indebtedness of the Company to
substantially the same extent as the Securities are subordinated and is entitled
to like rights of subrogation) to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until the
principal, premium, if any, and interest on the Securities shall be paid in full
and, for the purposes of such
-25-
subrogation, no payments or distributions to the holders of the Senior
Indebtedness of any cash, property or securities to which the holders of the
Securities or the Trustee would be entitled except for the provisions of this
Article IV, and no payment pursuant to the provisions of this Article IV, to or
---------- ----------
for the benefit of the holders of Senior Indebtedness by holders of the
Securities or the Trustee, shall, as between the Company, its creditors other
than holders of Senior Indebtedness, and the holders of the Securities, be
deemed to be a payment by the Company to or on account of the Senior
Indebtedness and no payments or distributions of cash, property or securities to
or for the benefit of the holders of the Securities pursuant to the subrogation
provisions of this Article IV, which would otherwise have been paid to the
----------
holders of Senior Indebtedness shall be deemed to be a payment by the Company to
or for the account of the Securities. It is understood that the provisions of
this Article IV are and are intended solely for the purposes of defining the
----------
relative rights of the holders of the Securities, on the one hand, and the
holders of the Senior Indebtedness, on the other hand.
Nothing contained in this Article IV or elsewhere in this Indenture or in
----------
the Securities is intended to or shall impair, as among the Company, its
creditors other than the holders of Senior Indebtedness, and the holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the holders of the Securities the principal of (and premium, if any)
and interest on the Securities as and when the same shall become due and payable
in accordance with their terms, or is intended to or shall affect the relative
rights of the holders of the Securities and creditors of the Company other than
the holders of the Senior Indebtedness, nor shall anything herein or therein
prevent the Trustee or the holder of any Security from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture, subject
to the rights, if any, under this Article IV of the holders of Senior
----------
Indebtedness in respect of cash, property or securities of the Company received
upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article IV, the Trustee, subject to the provisions of Section 8.1, and the
---------- -----------
holders of the Securities shall be entitled to rely upon any order or decree
made by any court of competent jurisdiction in which such bankruptcy,
dissolution, winding up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, trustee in bankruptcy, liquidating trustee,
agent or other person making such payment or distribution, delivered to the
Trustee or to the holders of the Securities, for the purpose of ascertaining the
persons entitled to participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon and all other facts pertinent thereto or to this Article IV.
----------
-26-
Section 4.4. Authorization to Effect Subordination. Each holder of a
-------------------------------------
Security by the holder's acceptance thereof authorizes and directs the Trustee
on the holder's behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article IV and appoints the
----------
Trustee to act as the holder's attorney-in-fact for any and all such purposes.
If the Trustee does not file a proper proof of claim or proof of debt in the
form required in any proceeding referred to in the third paragraph of Section
-------
7.2 hereof at least 30 days before the expiration of the time to file such
---
claim, the holders of any Senior Indebtedness or their representatives are
hereby authorized to file an appropriate claim for and on behalf of the holders
of the Securities.
Section 4.5. Notice to Trustee. The Company shall give prompt written
-----------------
notice in the form of an Officers' Certificate to a Responsible Officer of the
Trustee and to any paying agent of any fact known to the Company which would
prohibit the making of any payment of monies to or by the Trustee or any paying
agent in respect of the Securities pursuant to the provisions of this Article
-------
IV. Notwithstanding the provisions of this Article IV or any other provision of
-- ----------
this Indenture, the Trustee shall not be charged with knowledge of the existence
of any facts which would prohibit the making of any payment of monies to or by
the Trustee in respect of the Securities pursuant to the provisions of this
Article IV, unless and until a Responsible Officer of the Trustee shall have
----------
received written notice thereof at the Corporate Trust Office from the Company
(in the form of an Officers' Certificate) or a Representative or a holder or
holders of Senior Indebtedness or from any trustee thereof and before the
receipt of any such written notice, the Trustee, subject to the provisions of
Section 8.1, shall be entitled in all respects to assume that no such facts
-----------
exist; provided that, if on a date not fewer than two Business Days prior to the
-------- ----
date upon which by the terms hereof any such monies may become payable for any
purpose (including, without limitation, the payment of the principal of, or
premium, if any, or interest on any Security) the Trustee shall not have
received, with respect to such monies, the notice provided for in this Section
-------
4.5, then, anything herein contained to the contrary notwithstanding, the
---
Trustee shall have full power and authority to receive such monies and to apply
the same to the purpose for which they were received, and shall not be affected
by any notice to the contrary which may be received by it on or after such prior
date.
Notwithstanding anything in this Article IV to the contrary, nothing shall
----------
prevent any payment by the Trustee to the Securityholders of monies deposited
with it pursuant to Section 13.1, and any such payment shall not be subject to
------------
the provisions of Section 4.1 or 4.2.
----------- ---
The Trustee, subject to the provisions of Section 8.1, shall be entitled to
-----------
rely on the delivery to it of a written notice by a Representative or a person
representing himself to be a holder of
-27-
Senior Indebtedness (or a trustee on behalf of such holder) to establish that
such notice has been given by a Representative or a holder of Senior
Indebtedness or a trustee on behalf of any such holder or holders. In the event
that the Trustee determines in good faith that further evidence is required with
respect to the right of any person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to this Article IV, the
----------
Trustee may request such person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Indebtedness held by such
person, the extent to which such person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
person under this Article IV, and if such evidence is not furnished, the Trustee
----------
may defer any payment to such person pending judicial determination as to the
right of such person to receive such payment.
Section 4.6. Trustee's Relation to Senior Indebtedness. The Trustee in
-----------------------------------------
its individual capacity shall be entitled to all the rights set forth in this
Article IV in respect of any Senior Indebtedness at any time held by it, to the
----------
same extent as any other holder of Senior Indebtedness, and nothing in Section
-------
8.13 or elsewhere in this Indenture shall deprive the Trustee of any of its
----
rights as such holder.
With respect to the holders of Senior Indebtedness, the Trustee undertakes
to perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article IV, and no implied covenants or
----------
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness and, subject to the
provisions of Section 8.1, the Trustee shall not be liable to any holder of
-----------
Senior Indebtedness if it shall pay over or deliver to holders of Securities,
the Company or any other person money or assets to which any holder of Senior
Indebtedness shall be entitled by virtue of this Article IV or otherwise.
----------
Section 4.7. No Impairment of Subordination. No right of any present or
------------------------------
future holder of any Senior Indebtedness to enforce subordination as herein
provided shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or failure to act, in
good faith, by any such holder, or by any noncompliance by the Company with the
terms, provisions and covenants of this Indenture, regardless of any knowledge
thereof which any such holder may have or otherwise be charged with.
Section 4.8 Certain Conversions Deemed Payment. For the purposes of this
----------------------------------
Article IV only, (1) the issuance and delivery of junior securities upon
----------
conversion of Securities in accordance with Article XV shall not be deemed to
----------
constitute a payment or distribution on account of the principal of (or premium,
if any) or interest on Securities or on account of the purchase or other
acquisition of Securities, and (2) the payment, issuance or
-28-
delivery of cash (except in satisfaction of fractional shares pursuant to
Section 15.2), property or securities (other than junior securities) upon
------------
conversion of a Security shall be deemed to constitute payment on account of the
principal of such Security. For the purposes of this Section 4.8, the term
-----------
"junior securities" means (a) shares of any stock of any class of the Company,
-----------------
or (b) securities of the Company which are subordinated in right of payment to
all Senior Indebtedness which may be outstanding at the time of issuance or
delivery of such securities to substantially the same extent as, or to a greater
extent than, the Securities are so subordinated as provided in this Article.
Nothing contained in this Article IV or elsewhere in this Indenture or in the
----------
Securities is intended to or shall impair, as among the Company, its creditors
other than holders of Senior Indebtedness and the Securityholders, the right,
which is absolute and unconditional, of the Holder of any Security to convert
such Security in accordance with Article XV.
----------
Section 4.9. Article Applicable to Paying Agents. If at any time any
-----------------------------------
paying agent other than the Trustee shall have been appointed by the Company and
be then acting hereunder, the term "Trustee" as used in this Article shall
-------
(unless the context otherwise requires) be construed as extending to and
including such paying agent within its meaning as fully for all intents and
purposes as if such paying agent were named in this Article in addition to or in
place of the Trustee; provided, however, that the first paragraph of Section 4.5
-------- ------- -----------
shall not apply to the Company or any Affiliate of the Company if it or such
Affiliate acts as paying agent.
Section 4.10. Senior Indebtedness Entitled to Rely. The holders of Senior
------------------------------------
Indebtedness (including, without limitation, Designated Senior Indebtedness)
shall have the right to rely upon this Article IV, and no amendment or
----------
modification of the provisions contained herein shall diminish the rights of
such holders unless such holders shall have agreed in writing thereto.
ARTICLE V.
PARTICULAR COVENANTS OF THE COMPANY
Section 5.1. Payment of Principal, Premium and Interest. The Company
------------------------------------------
covenants and agrees that it will duly and punctually pay or cause to be paid
the principal of and premium, if any, and interest on each of the Securities at
the places, at the respective times and in the manner provided herein and in the
Securities. Each installment of interest on the Securities due on any semi-
annual interest payment date may be paid by mailing checks for the interest
payable to or upon the written order of the holders of Securities entitled
thereto as they shall appear on the Security register; provided, that, with
--------
respect to any holder of Securities with an aggregate principal amount equal to
or in excess of $5,000,000, at the request of such holder in writing to the
Company at least five (5) days prior to the date
-29-
set for payment of interest (who shall then furnish notice to such effect to the
Trustee), interest on such holder's Securities shall be paid by wire transfer in
immediately available funds in accordance with the wire transfer instructions
supplied by such holder to the Trustee and paying agent (if different from the
Trustee).
Section 5.2. Maintenance of Office or Agency. The Company will maintain
-------------------------------
in Chicago, Illinois, an office or agency where the Securities may be
surrendered for registration of transfer or exchange or for presentation for
payment or for conversion or redemption 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 of the location, and any
change in the location, of such office or agency not designated or appointed by
the Trustee. If at any time the Company shall fail to maintain any such
required office or agency or shall fail to furnish the Trustee with the address
thereof, such presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office or the office or agency of the Trustee in
Chicago, Illinois.
The Company may also from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided
--------
that, no such designation or rescission shall in any manner relieve the Company
----
of its obligation to maintain an office or agency in Chicago, Illinois, for such
purposes. The Company will give prompt written notice to the holders of any
such designation or rescission and of any change in the location of any such
other office or agency.
The Company hereby initially designates the Trustee as paying agent,
Security registrar, Custodian and conversion agent, and each of the Corporate
Trust Office of the Trustee and the office or agency of the Trustee in Chicago,
Illinois as the office or agency of the Company for each of the aforesaid
purposes.
The Trustee agrees to mail, or cause to be mailed, the notices set forth in
Section 8.10(a) and the third paragraph of Section 8.11.
--------------- ------------
Section 5.3. Appointments to Fill Vacancies in Trustee's Office. The
--------------------------------------------------
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
will appoint, in the manner provided in Section 8.10, a Trustee, so that there
------------
shall at all times be a Trustee hereunder.
Section 5.4. Provisions as to Paying Agent.
-----------------------------
(a) If the Company shall appoint a paying agent other than the
Trustee, or if the Trustee shall appoint such a paying agent, it will cause
such paying agent to execute and deliver to the Trustee an instrument in
which such agent
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shall agree with the Trustee, subject to the provisions of this Section
-------
5.4:
---
(1) that it will hold all sums held by it as such agent for the
payment of the principal of and premium, if any, or interest on the
Securities (whether such sums have been paid to it by the Company or
by any other obligor on the Securities) in trust for the benefit of
the holders of the Securities;
(2) that it will give the Trustee notice of any failure by the
Company (or by any other obligor on the Securities) to make any
payment of the principal of and premium, if any, or interest on the
Securities when the same shall be due and payable; and
(3) that at any time during the continuance of an Event of
Default, upon request of the Trustee, it will forthwith pay to the
Trustee all sums so held in trust.
The Company shall, on or before each due date of the principal of,
premium, if any, or interest on the Securities, deposit with the paying
agent a sum sufficient to pay such principal, premium, if any, or interest,
and (unless such paying agent is the Trustee) the Company will promptly
notify the Trustee of any failure to take such action; provided that, if
-------- ----
such deposit is made on the due date, such deposit shall be received by the
paying agent by 10:00 a.m. (Chicago time), on such date.
(b) If the Company shall act as its own paying agent, it will, on
or before each due date of the principal of, premium, if any, or interest
on the Securities, set aside, segregate and hold in trust for the benefit
of the holders of the Securities a sum sufficient to pay such principal,
premium, if any, or interest so becoming due and will notify the Trustee of
any failure to take such action and of any failure by the Company (or any
other obligor under the Securities) to make any payment of the principal
of, premium, if any, or interest on the Securities when the same shall
become due and payable.
(c) Anything in this Section 5.4 to the contrary notwithstanding,
-----------
the Company may, at any time, for the purpose of obtaining a satisfaction
and discharge of this Indenture, or for any other reason, pay or cause to
be paid to the Trustee all sums held in trust by the Company or any paying
agent hereunder as required by this Section 5.4, such sums to be held by
-----------
the Trustee upon the trusts herein contained and upon such payment by the
Company or any paying agent to the Trustee, the Company or such paying
agent shall be released from all further liability with respect to such
sums.
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(d) Anything in this Section 5.4 to the contrary notwithstanding, the
-----------
agreement to hold sums in trust as provided in this Section 5.4 is subject
-----------
to Sections 13.3 and 13.4.
------------- ----
Section 5.5. Corporate Existence. Subject to Article XII, the Company
------------------- -----------
will do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence.
Section 5.6. Amendments to Warrants or New Preferred Stock.
----------------------------------------------
Without the consent of at least a majority in principal amount of the Securities
then outstanding, the Company shall not amend, modify or alter the terms of the
Warrants or the New Preferred Stock in any way that will (i) increase the amount
of dividends payable on the New Preferred Stock or advance dates on which such
dividends are payable, (ii) advance the redemption date of the New Preferred
Stock to a date prior to the maturity date of the Securities, or (iii) otherwise
be materially adverse to the interests of the holders of the Securities as the
holders of debt securities of the Company.
Section 5.7. Stay, Extension and Usury Laws. The Company covenants (to
------------------------------
the extent that it may lawfully do so) that it shall not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law or other law which would prohibit or
forgive the Company from paying all or any portion of the principal of, premium,
if any, or interest on the Securities as contemplated herein, wherever enacted,
now or at any time hereafter in force, or which may affect the covenants or the
performance of this Indenture and the Company (to the extent it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not, by resort to any such law, hinder, delay or impede
the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law has been enacted.
Section 5.8. Compliance Certificate. The Company shall deliver to the
----------------------
Trustee within 90 days after the end of each fiscal year of the Company
(beginning with the fiscal year ending October 31, 1997) an Officers'
Certificate as to the signer's knowledge of the Company's compliance with all
conditions and covenants on its part contained in this Indenture and stating
whether or not the signers know of any Event of Default that occurred during
such period. If they do, such Officers' Certificate shall describe the Event of
Default and its status and the Company's efforts to remedy the same.
Section 5.9. No Redemption of New Preferred Stock at the Option of the
---------------------------------------------------------
Company. The Company shall not redeem the New Preferred Stock prior to the
-------
maturity date of the Securities unless (i) such payments are made by the
-32-
Company with the proceeds from the issuance of (y) Indebtedness subordinate to
the Notes and bearing interest at a rate equal to or lower than the dividend
rate on the Series A Preferred Stock and having a maturity date not earlier than
the maturity date of the Notes or (z) equity securities accruing dividends at a
rate equal to or lower than the Series A Preferred Stock and not redeemable
prior to the maturity date of the Notes and (ii) the average Closing Price of
the Common Stock during the sixty (60) Trading Days immediately preceding the
second Business Day prior to the date of such prepayment is at least equal to
130% of the Conversion Price.
Section 5.10. No Repurchase of Warrants. The Company shall not repurchase
-------------------------
any of the Warrants or any rights associated therewith for so long as any
Securities are outstanding.
Section 5.11. Liquidation. Subject to the provisions of Article IV, so far
----------- ----------
as they may be applicable hereto, the Board of Directors or the stockholders of
the Company may not adopt a plan of liquidation which plan provides for,
contemplates or the effectuation of which is preceded by (a) the sale, lease,
conveyance or other disposition of all or substantially all of the assets of the
Company otherwise than substantially as an entirety (Article XII of this
-----------
Indenture being the Article which governs any such sale, lease, conveyance or
other disposition substantially as an entirety), and (b) the distribution of all
or substantially all of the proceeds of such sale, lease, conveyance or other
disposition and of the remaining assets of the Company to the holders of the
capital stock of the Company, unless the Company shall in connection with the
adoption of such plan make provision for, or agree that prior to making any
liquidating distributions it will make provision for, the satisfaction of the
Company's obligations hereunder and under the Securities as to the payment of
the principal and interest. The Company shall be deemed to make provision for
such payments only if (1) the Company irrevocably deposits in trust with the
Trustee money or U.S. Government Obligations maturing as to principal and
interest in such amounts and at such times as are sufficient, without
consideration of any reinvestment of such interest, to pay the principal of and
interest on the Securities then outstanding to maturity and to pay all other
sums payable by it hereunder, or (2) there is an express assumption of the due
and punctual payment of the Company's obligations hereunder and under the
Securities and the performance and observance of all covenants and conditions to
be performed by the Company hereunder, by the execution and delivery of a
supplemental indenture in form satisfactory to the Trustee, by a person who
acquires, or will acquire (otherwise than pursuant to a lease) a portion of the
assets of the Company, and which person will have assets (immediately after the
acquisition) and aggregate earnings (for such person's four full fiscal quarters
immediately preceding such acquisition) equal to not less than the assets of the
Company (immediately preceding such acquisition) and the aggregate earnings of
the Company (for its four full fiscal quarters immediately preceding the
acquisition), respectively, and which is a corporation organized under the laws
of the United States, any State thereof or the District of Columbia; provided,
--------
-33-
however, that the Company shall not make any liquidating distribution until
-------
after the Company shall have certified to the Trustee with an Officers'
Certificate at least five days prior to the making of any liquidating
distribution that it has complied with the provisions of this Section 5.11.
------------
Section 5.12. Notice of Defaults. In the event that Indebtedness of the
------------------
Company in an aggregate amount in excess of $10,000,000 is declared due and
payable before its maturity because of the occurrence of any default under such
Indebtedness, the Company will promptly give written notice to the Trustee of
such declaration or of the occurrence of any event which, with the giving of
notice or the passage of time, or both, would entitle the holder or holders of
such Indebtedness to declare such Indebtedness due and payable before its
maturity.
Section 5.13. Payment of Taxes and Other Claims. The Company will pay or
---------------------------------
discharge or cause to be paid or discharged, before the same shall become
delinquent, (1) all material taxes, assessments and governmental charges levied
or imposed upon the Company, directly or by reason of its ownership of any
Subsidiary or upon the income, profits or property of the Company, and (2) all
material lawful claims for labor, materials and supplies, which, if unpaid,
might by law become a lien upon the property of the Company; provided, however,
-------- -------
that the Company shall not be required to pay or discharge or cause to be paid
or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings and for which adequate provision has been made.
Section 5.14. Further Instruments and Acts. Upon request of the Trustee,
----------------------------
the Company will execute and deliver such further instruments and do such
further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
ARTICLE VI.
SECURITYHOLDERS' LISTS AND REPORTS BY
THE COMPANY AND TRUSTEE
Section 6.1. Securityholders' Lists. The Company covenants and agrees that
----------------------
it will furnish or cause to be furnished to the Trustee, semiannually, not more
than fifteen (15) days after each March 15 and September 15 in each year
beginning with March 15, 1998, and at such other times as the Trustee may
request in writing, within thirty (30) days after receipt by the Company of any
such request (or such lesser time as the Trustee may reasonably request in order
to enable it to timely provide any notice to be provided by it hereunder), a
list in such form as the Trustee may reasonably require of the names and
addresses of the holders of Securities as of a date not more than fifteen (15)
days (or such other date as the Trustee may reasonably request in
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order to so provide any such notices) prior to the time such information is
furnished, except that no such list need be furnished so long as the Trustee is
acting as Security registrar.
Section 6.2. Preservation and Disclosure of Lists.
------------------------------------
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the holders
of Securities contained in the most recent list furnished to it as provided
in Section 6.1 or maintained by the Trustee in its capacity as Security
-----------
registrar, if so acting. The Trustee may destroy any list furnished to it
as provided in Section 6.1 upon receipt of a new list so furnished.
-----------
(b) The rights of Securityholders to communicate with other holders
of Securities with respect to their rights under this Indenture or under
the Securities, and the corresponding rights and duties of the Trustee,
shall be as provided by the Trust Indenture Act.
(c) Every Securityholder, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of holders of
Securities made pursuant to the Trust Indenture Act.
Section 6.3. Reports by Trustee.
------------------
(a) Within 60 days after September 15 of each year commencing with
the year 1998, the Trustee shall transmit to holders of Securities such
reports dated as of September 15 of the year in which such reports are made
concerning the Trustee and its actions under this Indenture as may be
required pursuant to the Trust Indenture Act at the times and in the manner
provided pursuant thereto.
(b) A copy of such report shall, at the time of such transmission to
holders of Securities, be filed by the Trustee with each stock exchange and
automated quotation system upon which the Securities are listed and with
the Company. The Company will notify the Trustee in writing within a
reasonable time when the Securities are listed on any stock exchange and
automated quotation system.
Section 6.4. Reports by Company. The Company shall file with the Trustee
------------------
(and the Commission if at any time the Indenture becomes qualified under the
Trust Indenture Act), and transmit to holders of Securities, such information,
documents and other reports and such summaries thereof, as may be required
pursuant to the Trust Indenture Act at the times and in the manner provided
pursuant to such Act; provided that, any such information, documents or reports
--------
required to be filed with the
-35-
Commission pursuant to Section 13 or 15(d) of the Exchange Act shall be filed
with the Trustee within fifteen (15) days after the same are so required to be
filed with the Commission.
ARTICLE VII.
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON AN EVENT OF DEFAULT
Section 7.1. Events of Default. In case one or more of the following
-----------------
Events of Default (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) shall have occurred and be
continuing:
(a) default in the payment of any installment of interest upon any of
the Securities as and when the same shall become due and payable, and
continuance of such default for a period of thirty (30) days, whether or
not such payment is permitted under Article IV hereof; or
----------
(b) default in the payment of the principal of or premium, if any, on
any of the Securities as and when the same shall become due and payable
either at maturity or in connection with any redemption pursuant to Article
-------
III or repurchase pursuant to Article XVI, by acceleration or otherwise,
--- -----------
whether or not such payment is permitted under Article IV hereof; or
----------
(c) failure on the part of the Company duly to observe or perform (i)
any of its obligations under Section 5.6, 5.9, 5.10, 5.11, 12.1 or 15.1 of
----------- --- ---- ---- ---- ----
this Indenture (immediately upon the giving of notice described below,
without the passage of time) or (ii) any other of the covenants or
agreements on the part of the Company in the Securities or in this
Indenture (other than a covenant or agreement a default in whose
performance or whose breach is elsewhere in this Section 7.1 specifically
-----------
dealt with) continued for a period of thirty (30) days after the date on
which 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 a Responsible Officer of the Trustee by the holders of at least
25 percent (25%) in aggregate principal amount of the Securities at the
time outstanding determined in accordance with Section 9.4; or
-----------
(d) failure on the part of the Company or any Significant Subsidiary
with respect to its obligation to pay principal of or interest on
indebtedness for borrowed money in excess of $10 million beyond any
applicable grace period; or
-36-
(e) default by the Company with respect to any indebtedness for
borrowed money of the Company, which default results in acceleration of any
such indebtedness which is in an amount of in excess of $10 million without
such indebtedness having been discharged, or such acceleration having been
rescinded or annulled for a period of ten (10) days or redemption of the
New Preferred Stock at any time (other than as permitted by Section 5.9);
or
(f) the Company or any Significant Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization or
other relief with respect to itself or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, or shall consent to
any such relief or to the appointment of or taking possession by any such
official in an involuntary case or other proceeding commenced against it,
or shall make a general assignment for the benefit of creditors, or shall
fail generally to pay its debts as they become due within the meaning of
the bankruptcy law; or
(g) an involuntary case or other proceeding shall be commenced
against the Company or any Significant Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or
other similar official of it or any substantial part of its property, and
such involuntary case or other proceeding shall remain undismissed and
unstayed for a period of seventy-five (75) consecutive days; or
(h) the entry by a court having jurisdiction in the premises of a
final judgment, decree or order against the Company or any Significant
Subsidiary which shall require the payment by the Company or any of its
Significant Subsidiaries of an amount (to the extent not covered by
insurance) in excess of $1 million at any one time and the continuance of
any such judgment, decree or order unstayed, unpaid, undismissed or bonded
pending appeal and in effect for a period of sixty (60) consecutive days
which is not being contested in good faith by appropriate proceedings;
then, and in each and every such case (other than an Event of Default specified
in Section 7.1(f) or (g)), unless the principal of all of the Securities shall
-------------- ---
have already become due and payable, either the Trustee or the holders of not
less than 25 percent (25%) in aggregate principal amount of the Securities then
outstanding hereunder determined in accordance with Section 9.4, by notice in
-----------
writing to the Company (and to the Trustee if given by Securityholders), may
declare the principal of all the Securities and the interest accrued thereon to
be due and payable immediately, and upon any such declaration the same
-37-
shall become and shall be immediately due and payable, anything in this
Indenture or in the Securities contained to the contrary notwithstanding. If an
Event of Default specified in Section 7.1(f) or (g) occurs, the principal of all
-------------- -
the Securities and the interest accrued thereon shall be immediately and
automatically due and payable without necessity of further action. This
provision, however, is subject to the condition that if, at any time after the
principal of the Securities shall have been so declared due and payable, and
before any judgment or decree for the payment of the monies due shall have been
obtained or entered as hereinafter provided, the Company shall pay or shall
deposit with the Trustee a sum sufficient to pay all matured installments of
interest upon all Securities and the principal of and premium, if any, on any
and all Securities which shall have become due otherwise than by acceleration
(with interest on overdue installments of interest (to the extent that payment
of such interest is enforceable under applicable law) and on such principal and
premium, if any, at the rate borne by the Securities, to the date of such
payment or deposit) and amounts due to the Trustee pursuant to Section 8.6, and
-----------
if any and all defaults under this Indenture, other than the nonpayment of
principal of and premium, if any, and accrued interest on Securities which shall
have become due by acceleration, shall have been cured or waived pursuant to
Section 7.7, then and in every such case the holders of a majority in aggregate
-----------
principal amount of the Securities then outstanding determined in accordance
with Section 9.4, by written notice to the Company and to the Trustee, may waive
-----------
all defaults or Events of Default and rescind and annul such declaration and its
consequences but no such waiver or rescission and annulment shall extend to or
shall affect any subsequent default or Event of Default, or shall impair any
right consequent thereon. The Company shall notify a Responsible Officer of the
Trustee, promptly upon becoming aware thereof, of any Event of Default.
In case the Trustee shall have proceeded to enforce any right under this
Indenture and such proceedings shall have been discontinued or abandoned because
of such waiver or rescission and annulment or for any other reason or shall have
been determined adversely to the Trustee, then and in every such case the
Company, the holders of Securities, and the Trustee shall be restored
respectively to their several positions and rights hereunder, and all rights,
remedies and powers of the Company, the holders of Securities, and the Trustee
shall continue as though no such proceeding had been taken.
Section 7.2 Payments of Securities on Default; Suit Therefor. The Company
------------------------------------------------
covenants that (a) in case default shall be made in the payment of any
installment of interest upon any of the Securities as and when the same shall
become due and payable, and such default shall have continued for a period of
thirty (30) days, or (b) in case default shall be made in the payment of the
principal of or premium, if any, on any of the Securities as and when the same
shall have become due and payable, whether at
-38-
maturity of the Securities or in connection with any redemption or repurchase,
under this Indenture, by declaration or otherwise, then, upon demand of the
Trustee, the Company will pay to the Trustee, for the benefit of the holders of
the Securities, the whole amount that then shall have become due and payable on
all such Securities for principal and premium, if any, or interest, or both, as
the case may be, with interest upon the overdue principal and premium, if any,
and (to the extent that payment of such interest is enforceable under applicable
law) upon the overdue installments of interest at the rate borne by the
Securities and, in addition thereto, such further amount as shall be sufficient
to cover the costs and expenses of collection, including compensation to the
Trustee, its agents, attorney and counsel, and any expenses or liabilities
incurred by the Trustee hereunder. Until such demand by the Trustee, the Company
may pay the principal of and premium, if any, and interest on the Securities to
the registered holders, whether or not the Securities are overdue.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on the
Securities and collect in the manner provided by law out of the property of the
Company or any other obligor on the Securities wherever situated the monies
adjudged or decreed to be payable.
In the case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Securities under
Title 11 of the United States Code, or any other applicable law, or in case a
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
sequestrator or similar official shall have been appointed for or taken
possession of the Company or such other obligor, the property of the Company or
such other obligor, or in the case of any other judicial proceedings relative to
the Company or such other obligor upon the Securities, or to the creditors or
property of the Company or such other obligor, the Trustee, irrespective of
whether the principal of the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand pursuant to the provisions of this Section 7.2, shall
-----------
be entitled and empowered, by intervention in such proceedings or otherwise, to
file and prove a claim or claims for the whole amount of principal, premium, if
any, and interest owing and unpaid in respect of the Securities, and, in case of
any judicial proceedings, to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee and of the Securityholders allowed in such judicial proceedings relative
to the Company or any other obligor on the Securities, its or their creditors,
or its or their property, and to collect and receive any monies or other
-39-
property payable or deliverable on any such claims, and to distribute the same
after the deduction of any amounts due the Trustee under Section 8.6 and any
-----------
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
custodian or similar official is hereby authorized by each of the
Securityholders 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
Securityholders, to pay to the Trustee any amount due it for reasonable
compensation, expenses, advances and disbursements, including counsel fees
incurred by it up to the date of such distribution. To the extent that such
payment of reasonable compensation, expenses, advances and disbursements out of
the estate in any such proceedings shall be denied for any reason, payment of
the same shall be secured by a lien on, and shall be paid out of, any and all
distributions, dividends, monies, securities and other property which the
holders of the Securities may be entitled to receive in such proceedings,
whether in liquidation or under any plan of reorganization or arrangement or
otherwise.
All rights of action and of asserting claims under this Indenture, or under
any of the Securities, may be enforced by the Trustee without the possession of
any of the Securities, or the production thereof at any trial or other
proceeding relative thereto, and any such suit or proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the holders of the Securities.
In any proceedings brought by the Trustee (and in any proceedings involving
the interpretation of any provision of this Indenture to which the Trustee shall
be a party), the Trustee shall be held to represent all the holders of the
Securities, and it shall not be necessary to make any holders of the Securities
parties to any such proceedings.
Section 7.3. Application of Monies Collected by Trustee. Any monies
------------------------------------------
collected by the Trustee pursuant to this Article VII shall be applied in the
-----------
order following, at the date or dates fixed by the Trustee for the distribution
of such monies, upon presentation of the several Securities, and stamping
thereon the payment, if only partially paid, and upon surrender thereof, if
fully paid:
First: to the payment of all amounts due the Trustee under Section
----- -------
8.6;
---
Second: subject to the provisions of Article IV, in case the
------ ----------
principal of the outstanding Securities shall not have become due and be
unpaid, to the payment of interest on the Securities in default in the
order of the maturity of the installments of such interest, with interest
(to the extent
-40-
that such interest has been collected by the Trustee) upon the overdue
installments of interest at the rate borne by the Securities, such payments
to be made ratably to the persons entitled thereto;
Third: subject to the provisions of Article IV, in case the principal
----- ----------
of the outstanding Securities shall have become due, by declaration or
otherwise, and be unpaid, to the payment of the whole amount then owing and
unpaid upon the Securities for principal and premium, if any, and interest,
with interest on the overdue principal and premium, if any, and (to the
extent that such interest has been collected by the Trustee) upon overdue
payments of interest at the rate borne by the Securities and in case such
monies shall be insufficient to pay in full the whole amounts so due and
unpaid upon the Securities, then to the payment of such principal and
premium, if any, and interest without preference or priority of principal
and premium, if any, over interest, or of interest over principal and
premium, if any, or of any installment of interest over any other
installment of interest, or of any Security over any other Security,
ratably to the aggregate of such principal and premium, if any, and accrued
and unpaid interest; and
Fourth: subject to the provisions of Article IV, to the payment of
------ ----------
the remainder, if any, to the Company or any other person lawfully entitled
thereto.
Section 7.4. Proceedings by Securityholder. No holder of any Security
-----------------------------
shall have any right by virtue of or by availing of any provision of this
Indenture to institute any suit, action or proceeding in equity or at law upon
or under or with respect to this Indenture, or for the appointment of a
receiver, trustee, liquidator, custodian or other similar official, or for any
other remedy hereunder, unless such holder previously shall have given to the
Trustee written notice of an Event of Default and of the continuance thereof, as
hereinbefore provided, and unless also the holders of not less than 25 percent
(25%) in aggregate principal amount of the Securities then outstanding
determined in accordance with Section 9.4 shall have made written request upon
-----------
the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee for sixty (60) days after its
receipt of such notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding and no direction
inconsistent with such written request shall have been given to the Trustee
pursuant to Section 7.7, it being understood and intended, and being expressly
-----------
covenanted by the taker and holder of every Security with every other taker and
holder and the Trustee, that no one or more holders of Securities shall have any
right in any manner whatever by virtue of or by availing of any provision of
this Indenture to affect, disturb or
-41-
prejudice the rights of any other holder of Securities, or to obtain or seek
to obtain priority over or preference to any other such holder, or to enforce
any right under this Indenture, except in the manner herein provided and for the
equal, ratable and common benefit of all holders of Securities (except as
otherwise provided herein). For the protection and enforcement of this Section
-------
7.4, each and every Securityholder and the Trustee shall be entitled to such
---
relief as can be given either at law or in equity.
Notwithstanding any other provision of this Indenture and any provision of
any Security, the right of any holder of any Security to receive payment of the
principal of and premium, if any, and interest on such Security, on or after the
respective due dates therefor, or to institute suit for the enforcement of any
such payment on or after such respective dates against the Company shall not be
impaired or affected without the consent of such holder.
Anything in this Indenture or the Securities to the contrary
notwithstanding, the holder of any Security, without the consent of either the
Trustee or the holder of any other Security, in his own behalf and for his own
benefit, may enforce, and may institute and maintain any proceeding suitable to
enforce, his rights of conversion as provided herein.
Section 7.5. Proceedings by Trustee. In case of an Event of Default the
----------------------
Trustee may in its discretion proceed to protect and enforce the rights vested
in it by this Indenture by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any of such rights, either by
suit in equity or by action at law or by proceeding in bankruptcy or otherwise,
whether for the specific enforcement of any covenant or agreement contained in
this Indenture or in aid of the exercise of any power granted in this Indenture,
or to enforce any other legal or equitable right vested in the Trustee by this
Indenture or by law.
Section 7.6. Remedies Cumulative and Continuing. Except as provided in the
----------------------------------
last paragraph of Section 2.6, all powers and remedies given by this Article VII
----------- -----------
to the Trustee or to the Securityholders shall, to the extent permitted by law,
be deemed cumulative and not exclusive of any thereof or of any other powers and
remedies available to the Trustee or the holders of the Securities, by judicial
proceedings or otherwise, to enforce the performance or observance of the
covenants and agreements contained in this Indenture, and no delay or omission
of the Trustee or of any holder of any of the Securities to exercise any right
or power accruing upon any default or Event of Default occurring and continuing
as aforesaid shall impair any such right or power, or shall be construed to be a
waiver of any such default or any acquiescence therein and, subject to the
provisions of Section 7.4, every power and remedy given by this Article VII or
----------- -----------
by law to the Trustee or to the Securityholders
-42-
may be exercised from time to time, and as often as shall be deemed expedient,
by the Trustee or by the Securityholders.
Section 7.7. Direction of Proceedings and Waiver of Defaults by Majority
-----------------------------------------------------------
of Securityholders. The holders of a majority in aggregate principal amount of
------------------
the Securities at the time outstanding determined in accordance with Section 9.4
-----------
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; provided, however, that (a) such direction shall
-------- -------
not be in conflict with any rule of law or with this Indenture, and (b) the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction. The holders of a majority in aggregate
principal amount of the Securities at the time outstanding determined in
accordance with Section 9.4 may on behalf of the holders of all of the
-----------
Securities waive any past default or Event of Default hereunder and its
consequences except (i) a default in the payment of interest or premium, if any,
on, or the principal of, the Securities, (ii) a failure by the Company to
convert any Securities into Common Stock, (iii) a default in the payment of
redemption price pursuant to Article III or repurchase price pursuant to Article
----------- -------
XVI or (iv) a default in respect of a covenant or provisions hereof which under
---
Article XI cannot be modified or amended without the consent of the holders of
----------
all Securities then outstanding. Upon any such waiver the Company, the Trustee
and the holders of the Securities shall be restored to their former positions
and rights hereunder but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent thereon. Whenever any
default or Event of Default hereunder shall have been waived as permitted by
this Section 7.7, said default or Event of Default shall for all purposes of the
-----------
Securities and this Indenture be deemed to have been cured and to be not
continuing but no such waiver shall extend to any subsequent or other default or
Event of Default or impair any right consequent thereon.
Section 7.8. Notice of Defaults. The Trustee shall, within ninety (90)
------------------
days after a Responsible Officer has knowledge of the occurrence of a default,
mail to all Securityholders, as the names and addresses of such holders appear
upon the Security register, notice of all defaults known to a Responsible
Officer, unless such defaults shall have been cured or waived before the giving
of such notice and provided that, except in the case of default in the payment
of the principal of, or premium, if any, or interest on any of the Securities,
the Trustee shall be protected in withholding such notice if and so long as a
trust committee of directors and/or officers of the Trustee in good faith
determine that the withholding of such notice is in the interests of the
Securityholders.
Section 7.9. Undertaking to Pay Costs. All parties to this Indenture
------------------------
agree, and each holder of any Security by his
-43-
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 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; provided that,
-------- ----
the provisions of this Section 7.9 (to the extent permitted by law) shall not
-----------
apply to any suit instituted by the Trustee, to any suit instituted by any
Securityholder, or group of Securityholders, holding in the aggregate more than
ten percent (10%) in principal amount of the Securities at the time outstanding
determined in accordance with Section 9.4, or to any suit instituted by any
-----------
Securityholder for the enforcement of the payment of the principal of or
premium, if any, or interest on any Security on or after the due date therefor
or to any suit for the enforcement of the right to convert any Security in
accordance with the provisions of Article XV or to require the Company to
----------
repurchase any Security in accordance with Article XVI.
-----------
ARTICLE VIII.
CONCERNING THE TRUSTEE
Section 8.1. Duties and Responsibilities of Trustee. The Trustee, prior to
--------------------------------------
the occurrence of an Event of Default and after the curing of all Events of
Default which may have occurred, undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture. In case an Event of
Default has occurred (which has not been cured or waived) the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and use
the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his own affairs.
No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act or
its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after the
curing or waiving of all Events of Default which may have occurred:
(1) the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Indenture and the Trust
Indenture Act, and the Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set
forth in this Indenture and no implied covenants or obligations shall
be read into this Indenture or the Trust Indenture Act against the
Trustee; and
-44-
(2) in the absence of bad faith and willful misconduct on the
part of the Trustee, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished to the Trustee
and conforming to the requirements of this Indenture but, in the case
of any such certificates or opinions which by any provisions hereof
are specifically required to be furnished to the Trustee, the Trustee
shall be under a duty to examine the same to determine whether or not
they conform to the requirements of this Indenture;
(b) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Officers of the Trustee, unless the
Trustee was negligent in ascertaining the pertinent facts;
(c) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction
of the holders of not less than a majority in principal amount of the
Securities at the time outstanding determined as provided in Section 9.4
-----------
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; and
(d) whether or not therein provided, every provision of this
Indenture relating to the conduct or affecting the liability of, or
affording protection to, the Trustee as trustee, paying agent, Security
registrar, Custodian or conversion agent shall be subject to the provisions
of this Section.
None of the provisions contained in this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers.
Section 8.2. Reliance on Documents, Opinions, Etc. Except as otherwise
-------------------------------------
provided in Section 8.1:
-----------
(a) the Trustee may rely and shall be protected in acting upon any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, bond, Note, Security, coupon or other paper or
document believed by it in good faith to be genuine and to have been signed
or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by an Officers' Certificate (unless
other evidence in respect thereof be herein specifically prescribed) and
any
-45-
resolution of the Board of Directors may be evidenced to the Trustee by
a copy thereof certified by the Secretary or an Assistant Secretary of the
Company;
(c) the Trustee may consult with counsel and any advice or Opinion of
Counsel shall be full and complete authorization and protection in respect
of any action taken or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(d) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Securityholders pursuant to the provisions of this
Indenture, unless such Securityholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities which may be incurred therein or thereby;
(e) 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, note 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;
provided, however, that if the payment within a reasonable time to the
-------- -------
Trustee of the costs, expenses or liabilities likely to be incurred by it
in the making of such investigation is, in the opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the
terms of this Indenture, the Trustee may require reasonable indemnity
against such expenses or liability as a condition to so proceeding and the
reasonable expenses of every such examination shall be paid by the Company
or, if paid by the Trustee or any predecessor Trustee, shall be repaid by
the Company upon demand;
(f) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed by it with due
care hereunder; and
(g) the Trustee shall not be deemed to have notice of an Event of
Default or of any event or conditions which, with the giving of notice, the
passage of time, or both, might constitute an Event of Default unless (i)
the Trustee has received written notice thereof from the Company or any
-46-
Securityholder or (ii) a Responsible Officer of the Trustee shall have
actual knowledge thereof.
Section 8.3. No Responsibility for Recitals, Etc. The recitals contained
------------------------------------
herein and in the Securities (except in the Trustee's certificate of
authentication) shall be taken as the statements of the Company, and the Trustee
assumes no responsibility for the correctness of the same. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities. The Trustee shall not be accountable for the use or application by
the Company of any Securities or the proceeds of any Securities authenticated
and delivered by the Trustee in conformity with the provisions of this
Indenture.
Section 8.4. Trustee, Paying Agents, Conversion Agents or Registrar May
----------------------------------------------------------
Own Securities. The Trustee, any paying agent, any conversion agent or Security
--------------
registrar, in its individual or any other capacity, may become the owner or
pledgee of Securities with the same rights it would have if it were not Trustee,
paying agent, conversion agent or Security registrar.
Section 8.5. Monies to Be Held in Trust. Subject to the provisions of
--------------------------
Section 13.4, all monies received by the Trustee shall, until used or applied as
------------
herein provided, be held in trust for the purposes for which they were received.
Money held by the Trustee in trust hereunder need 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 may be
agreed from time to time by the Company and the Trustee.
Section 8.6. Compensation and Expenses of Trustee. The Company covenants
------------------------------------
and agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, reasonable compensation for all services rendered by it hereunder
in any capacity (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 will pay or
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances reasonably incurred or made by the Trustee 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 persons not regularly in its employ), except any such expense, disbursement
or advance as may arise from its negligence or willful misconduct or bad faith.
The Company also covenants to indemnify the Trustee in any capacity under this
Indenture and its agents and any authenticating agent for, and to hold them
harmless against, any loss, liability or expense incurred without negligence or
willful misconduct or bad faith on the part of the Trustee or such agent or
authenticating agent, as the case may be, and arising out of or in connection
with the acceptance or administration of this trust or in any other capacity
hereunder, including the costs and expenses of defending themselves against
-47-
any claim of liability in the premises. All indemnifications and releases from
liability granted hereunder to the Trustee shall extend to its officers,
directors, employees, agents, successors and assigns. The obligations of the
Company under this Section 8.6 to compensate or indemnify the Trustee and to pay
-----------
or reimburse the Trustee for expenses, disbursements and advances shall be
secured by 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. The obligation of the Company
under this Section shall survive the satisfaction and discharge of this
Indenture and the resignation or removal of the Trustee.
When the Trustee and its agents and any authenticating agent incur expenses
or render services after an Event of Default specified in Section 7.1(f) or (g)
-------------- ---
occurs, the expenses and the compensation for the services are intended to
constitute expenses of administration under any bankruptcy, insolvency or
similar laws.
Section 8.7. Officers' Certificate as Evidence. Except as otherwise
---------------------------------
provided in Section 8.1, wherever in the administration of the provisions of
-----------
this Indenture the Trustee shall deem it necessary or desirable that a matter be
proved or established prior to taking or omitting any action hereunder, such
matter (unless other evidence in respect thereof be herein specifically
prescribed) may, in the absence of negligence or willful misconduct or bad faith
on the part of the Trustee, be deemed to be conclusively proved and established
by an Officers' Certificate delivered to the Trustee.
Section 8.8. Conflicting Interests of Trustee. If the Trustee has or
--------------------------------
shall acquire a conflicting interest within the meaning of the Trust Indenture
Act, if required by the Trust Indenture Act, the Trustee shall either eliminate
such interest or resign, to the extent and in the manner provided by, and
subject to the provisions of, the Trust Indenture Act and this Indenture.
Section 8.9. Eligibility of Trustee. There shall at all times be a
----------------------
Trustee hereunder which shall be a Person that is eligible pursuant to the Trust
Indenture Act to act as such and which shall have (or, in the case of a
corporation included in a bank holding company system, the related bank holding
company shall have) a combined capital and surplus of at least $50,000,000. If
such person publishes reports of condition at least annually, pursuant to law or
to the requirements of any supervising or examining authority, then for the
purposes of this Section, the combined capital and surplus of such person shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. If at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section, it shall resign
immediately in the manner and with the effect hereinafter specified in this
Article.
-48-
Section 8.10. Resignation or Removal of Trustee.
---------------------------------
(a) The Trustee may at any time resign by giving written notice of
such resignation to the Company and to the holders of Securities. Upon
receiving such notice of resignation, the Company shall promptly appoint a
successor trustee by written instrument, in duplicate, executed by order of
the Board of Directors, one copy of which instrument shall be delivered to
the resigning Trustee and one copy to the successor trustee. If no
successor trustee shall have been so appointed and have accepted
appointment within sixty (60) days after the mailing of such notice of
resignation to the Securityholders, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor trustee,
or any Securityholder who has been a bona fide holder of a Security or
Securities for at least six months may, subject to the provisions of
Section 7.9, on behalf of himself and all others similarly situated,
-----------
petition any such court for the appointment of a successor trustee. Such
court may thereupon, after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with Section 8.8 after
-----------
written request therefor by the Company or by any Securityholder who
has been a bona fide holder of a Security or Securities for at least
six months; or
(2) the Trustee shall cease to be eligible in accordance with
the provisions of Section 8.9 and shall fail to resign after written
-----------
request therefor by the Company or by any such Securityholder; or
(3) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent, or a receiver of the Trustee or of
its property shall be appointed, or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any such case, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of
the Board of Directors, one copy of which instrument shall be delivered to
the Trustee so removed and one copy to the successor trustee, or, subject
to the provisions of Section 7.9, any Securityholder who has been a bona
-----------
fide holder of a Security or Securities for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the
-49-
removal of the Trustee and the appointment of a successor trustee. Such
court may thereupon, after such notice, if any, as it may deem proper and
prescribe, remove the Trustee and appoint a successor trustee.
(c) The holders of a majority in aggregate principal amount of the
Securities at the time outstanding may at any time remove the Trustee and
nominate a successor trustee which shall be deemed appointed as successor
trustee, unless within ten (10) days after notice to the Company of such
nomination, the Company objects thereto, in which case the Trustee so
removed or any Securityholder, upon the terms and conditions and otherwise
as in Section 8.10(a) provided, may petition any court of competent
---------------
jurisdiction for an appointment of a successor trustee.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 8.10
------------
shall become effective upon acceptance of appointment by the successor
trustee as provided in Section 8.11.
------------
Section 8.11. Acceptance by Successor Trustee. Any successor trustee
-------------------------------
appointed as provided in Section 8.10 shall execute, acknowledge and deliver to
------------
the Company and to its predecessor trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all the rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as trustee herein but, nevertheless, on the written request
of the Company or of the successor trustee, the trustee ceasing to act shall,
upon payment of any amounts then due it pursuant to the provisions of Section
-------
8.6, execute and deliver an instrument transferring to such successor trustee
---
all the rights and powers of the trustee so ceasing to act. Upon request of any
such successor trustee, the Company shall execute any and all instruments in
writing for more fully and certainly vesting in and confirming to such successor
trustee all such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a lien upon all property and funds held or collected by
such trustee as such, except for funds held in trust for the benefit of holders
of particular Securities, to secure any amounts then due it pursuant to the
provisions of Section 8.6.
-----------
No successor trustee shall accept appointment as provided in this Section
-------
8.11 unless at the time of such acceptance such successor trustee shall be
----
qualified under the provisions of Section 8.8 and be eligible under the
-----------
provisions of Section 8.9.
-----------
Upon acceptance of appointment by a successor trustee as provided in this
Section 8.11, the Company (or the former trustee, at the written direction of
------------
the Company) shall mail or cause to be
-50-
mailed notice of the succession of such trustee hereunder to the holders of
Securities at their addresses as they shall appear on the Security register. If
the Company fails to mail such notice within ten (10) days after acceptance of
appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Company.
Section 8.12. Succession by Merger, Etc. Any corporation into which the
--------------------------
Trustee may be merged or converted or with which it may be consolidated, or any
corporation resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation succeeding to all or substantially
all of the corporate trust business of the Trustee (including any trust created
by this Indenture), shall be the successor to the Trustee hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that in the case of any corporation succeeding to all
or substantially all of the corporate trust business of the Trustee such
corporation shall be qualified under the provisions of Section 8.8 and eligible
-----------
under the provisions of Section 8.9.
-----------
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture, any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the
certificate of authentication of any predecessor trustee or authenticating agent
appointed by such predecessor trustee, and deliver such Securities so
authenticated and in case at that time any of the Securities shall not have been
authenticated, any successor to the Trustee or an authenticating agent appointed
by such successor trustee may authenticate such Securities either in the name of
any predecessor trustee hereunder or in the name of the successor trustee and in
all such cases such certificates shall have the full force of the Securities and
this Indenture; provided, however, that the right to adopt the certificate of
-------- -------
authentication of any predecessor Trustee or authenticate Securities in the name
of any predecessor Trustee shall apply only to its successor or successors by
merger, conversion or consolidation.
Section 8.13. Limitation on Rights of Trustee as Creditor. If and when the
-------------------------------------------
Trustee shall be or become a creditor of the Company (or any other obligor upon
the Securities), the Trustee shall be subject to the provisions of the Trust
Indenture Act regarding the collection of the claims against the Company (or any
such other obligor).
ARTICLE IX.
CONCERNING THE SECURITYHOLDERS
Section 9.1. Action by Securityholders. When in this Indenture it is
-------------------------
provided that the holders of a specified percentage in aggregate principal
amount of the Securities may take any action (including the making of any demand
or request,
-51-
the giving of any notice, consent or waiver or the taking of any other action),
the fact that at the time of taking any such action, the holders of such
specified percentage have joined therein may be evidenced (a) by any instrument
or any number of instruments of similar tenor executed by Securityholders in
person or by agent or proxy appointed in writing, or (b) by the record of the
holders of Securities voting in favor thereof at any meeting of Securityholders
duly called and held in accordance with the provisions of Article X, or (c) by a
---------
combination of such instrument or instruments and any such record of such a
meeting of Securityholders. Whenever the Company or the Trustee solicits the
taking of any action by the holders of the Securities, the Company or the
Trustee may fix in advance of such solicitation, a date as the record date for
determining holders entitled to take such action. The record date shall be not
more than fifteen (15) days prior to the date of commencement of solicitation of
such action.
Section 9.2. Proof of Execution by Securityholders. Subject to the
-------------------------------------
provisions of Sections 8.1, 8.2 and 10.5, proof of the execution of any
------------ ---- ----
instrument by a Securityholder or his agent or proxy shall be sufficient if made
in accordance with such reasonable rules and regulations as may be prescribed by
the Trustee or in such manner as shall be satisfactory to the Trustee. The
holding of Securities shall be proved by the registry of such Securities or by a
certificate of the Security registrar.
The record of any Securityholders' meeting shall be proved in the manner
provided in Section 10.6.
------------
Section 9.3. Who Are Deemed Absolute Owners. The Company, any other
------------------------------
obligor on the Securities, the Trustee, any authenticating agent, any paying
agent, any conversion agent and any Security registrar may deem the person in
whose name such Security shall be registered upon the Security register to be,
and may treat him as, the absolute owner of such Security (whether or not such
Security shall be overdue and notwithstanding any notation of ownership or other
writing thereon) for the purpose of receiving payment of or on account of the
principal of, premium, if any, and interest on such Security, for conversion of
such Security and for all other purposes and neither the Company nor any other
obligor on the Securities nor the Trustee nor any paying agent nor any
conversion agent nor any authenticating agent nor any Security registrar shall
be affected by any notice to the contrary. All such payments so made to any
holder for the time being, or upon his order, shall be valid, and, to the extent
of the sum or sums so paid, effectual to satisfy and discharge the liability for
monies payable upon any such Security.
Section 9.4. Company-Owned Security Disregarded. In determining whether
----------------------------------
the holders of the requisite aggregate principal amount of Securities have
concurred in any direction,
-52-
consent, waiver or other action under this Indenture, Securities which are owned
by the Company or any other obligor on the Securities or by any person directly
or indirectly controlling or controlled by or under direct or indirect common
control with the Company or any other obligor on the Securities shall be
disregarded and deemed not to be outstanding for the purpose of any such
determination; provided that, for the purposes of determining whether the
--------
Trustee shall be protected in relying on any such direction, consent, waiver or
other action, only Securities which a Responsible Officer knows are so owned
shall be so disregarded. Securities so owned which have been pledged in good
faith may be regarded as outstanding for the purposes of this Section 9.4 if the
-----------
pledgee shall establish to the satisfaction of the Trustee the pledgee's right
to vote such Securities and that the pledgee is not the Company, any other
obligor on the Securities or a person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
such other obligor. In the case of a dispute as to such right, any decision by
the Trustee taken upon the advice of counsel shall be full protection to the
Trustee. Upon request of the Trustee, the Company shall furnish to the Trustee
promptly an Officers' Certificate listing and identifying all Securities, if
any, known by the Company to be owned or held by or for the account of any of
the above-described persons and, subject to Section 8.1, the Trustee shall be
-----------
entitled to accept such Officers' Certificate as conclusive evidence of the
facts therein set forth and of the fact that all Securities not listed therein
are outstanding for the purpose of any such determination.
Section 9.5. Revocation of Consents: Future Holders Bound. At any time
--------------------------------------------
prior to (but not after) the evidencing to the Trustee, as provided in Section
-------
9.1, of taking of any action by the holders of the percentage in aggregate
---
principal amount of the Securities specified in this Indenture in connection
with such action, any holder of a Security which is shown by the evidence to be
included in the Securities the holders of which have consented to such action
may, by filing written notice with the Trustee at its Corporate Trust Office and
upon proof of holding as provided in Section 9.2, revoke such action so far as
-----------
it such Security. Except as aforesaid, any such action taken by the holder of
any Security shall be conclusive and binding upon such holder and upon all
future holders and owners of such Security and of any Securities issued in
exchange or substitution therefor, irrespective of whether any notation in
regard thereto is made upon such Security or any Security issued in exchange or
substitution therefor.
ARTICLE X
SECURITYHOLDERS' MEETINGS
Section 10.1. Purpose of Meetings. A meeting of Securityholders may be
-------------------
called at any time and from time to time
-53-
pursuant to the provisions of this Article X for any of the following purposes:
---------
(a) to give any notice to the Company or to the Trustee or to give
any directions to the Trustee permitted under this Indenture, or to consent
to the waiving of any default or Event of Default hereunder and its
consequences, or to take any other action authorized to be taken by
Securityholders pursuant to any of the provisions of Article VII;
-----------
(b) to remove the Trustee and nominate a successor trustee pursuant
to the provisions of Article VIII;
------------
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 11.2; or
------------
(d) to take any other action authorized to be taken by or on behalf
of the holders of any specified aggregate principal amount of the
Securities under any other provision of this Indenture or under applicable
law.
Section 10.2. Call of Meetings by Trustee. The Trustee may at any time
---------------------------
call a meeting of Securityholders to take any action specified in Section 10.1,
------------
to beat such time and at such place at a location within ten (10) miles of the
Corporate Trust Office or the principal executive office of the Company, as the
Trustee shall determine. Notice of every meeting of the Securityholders, setting
forth the time and the place of such meeting and in general terms the action
proposed to be taken at such meeting and the establishment of any record date
pursuant to Section 9.1, shall be mailed to holders of Securities at their as
-----------
they shall appear on the Security register. Such notice shall also be mailed to
the Company. Such notices shall be mailed not less than fifteen (15) nor more
than ninety (90) days prior to the date fixed for the meeting.
Any meeting of Securityholders shall be valid without notice if the holders
of all Securities then outstanding are present in person or by proxy or if
notice is waived before or after the meeting by the holders of all Securities
outstanding, and if the Company and the Trustee are either present by duly
authorized representatives or have, before or after the meeting, waived notice.
Section 10.3. Call of Meetings by Company or Securityholders. In case at
----------------------------------------------
any time the Company, pursuant to a resolution of its Board of Directors, or the
holders of at least ten percent (10%) in aggregate principal amount of the
Securities then outstanding, shall have requested the Trustee to call a meeting
of Securityholders, by written request setting forth in reasonable detail the
action proposed to be taken at the meeting, and the Trustee shall not have
mailed the notice of such meeting
-54-
within ten (10) days after receipt of such request, then the Company or such
Securityholders may determine the time and the place at any location within 10
miles of the Corporate Trust Office or the principal executive offices of the
Company for such meeting and may call such meeting to take any action authorized
in Section 10.1, by mailing notice thereof provided in Section 10.2.
------------ ------------
Section 10.4. Qualifications for Voting. To be entitled to vote at any
-------------------------
meeting of Securityholders a person shall (a) be a holder of one or more
Securities on the record date pertaining to such meeting or (b) be a person
appointed by an instrument in writing as proxy by a holder of one or more
Securities. The only persons who shall be entitled to be present or to speak at
any meeting of Securityholders shall be the persons entitled to vote at such
meeting and their counsel and any representatives of the Trustee and its counsel
and any representatives of the Company and its counsel.
Section 10.5. Regulations. Notwithstanding any other provisions of this
-----------
Indenture, the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Securityholders, 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 think fit.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Securityholders as provided in Section 10.3, in which case the
------------
Company or the Securityholders calling the meeting, as the case may be, 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 holders of a majority
in principal amount of the Securities represented at the meeting and entitled to
vote at the meeting.
Subject to the provisions of Section 9.4, at any meeting each
-----------
Securityholder or proxyholder shall be entitled to one vote for each $1,000
principal amount of Securities held or represented by such Securityholder;
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 other than by virtue of Securities held by him or instruments in
writing as aforesaid duly designating him as the proxy to vote on behalf of
other Securityholders. Any meeting of Securityholders duly called pursuant to
the provisions of Section 10.2 or 10.3 may be adjourned from time to time by the
------------ ----
holders of a majority of the aggregate principal amount of Securities
represented at the meeting, whether or not constituting a quorum, and the
meeting may be held as so adjourned without further notice.
-55-
Section 10.6. Voting. The vote upon any resolution submitted to any
------
meeting of Securityholders shall be by written ballot on which shall be
subscribed the signatures of the holders of Securities or of their
representatives by proxy and the principal amount of the 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 in duplicate of the proceedings of each meeting of Securityholders 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 mailed as provided in Section 10.2. The record shall show the
------------
principal amount of the Securities voting in favor of or against any resolution.
The record shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one of the duplicates shall be
delivered to the Company and the other 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.
Section 10.7. No Delay of Rights by Meeting. Nothing in this Article X
----------------------------- ---------
contained shall be deemed or construed to authorize or permit, by reason of any
call of a meeting of Securityholders or any rights expressly or impliedly
conferred hereunder to make such call, any hindrance or delay in the exercise of
any right or rights conferred upon or reserved to the Trustee or to the
Securityholders under any of the provisions of this Indenture or of the
Securities.
ARTICLE XI.
SUPPLEMENTAL INDENTURES
Section 11.1. Supplemental Indentures Without Consent of Securityholders.
----------------------------------------------------------
The Company, when authorized by the resolutions of the Board of Directors, and
the Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto for one or more of the following purposes:
(a) to make provision with respect to the conversion rights of the
holders of Securities pursuant to the requirements of Section 15.6 or the
------------
repurchase obligations of the Company pursuant to the requirements of
Section 16.5;
------------
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(b) subject to Article IV, to convey, transfer, assign, mortgage or
----------
pledge to the Trustee as security for the Securities, any property or
assets;
(c) to evidence the succession of another corporation to the Company,
or successive successions, and the assumption by the successor corporation
of the covenants, agreements and obligations of the Company pursuant to
Article XII;
-----------
(d) to add to the covenants of the Company such further covenants,
restrictions or conditions as the Board of Directors and the Trustee shall
consider to be for the benefit of the holders of Securities, and to make
the occurrence, or the occurrence and continuance, of a default in any such
additional covenants, restrictions or conditions a default or an Event of
Default permitting the enforcement of all or any of the several remedies
provided in this Indenture as herein set forth; provided, however, that in
-------- -------
respect of any such additional covenant, restriction or condition such
supplemental indenture may provide for a particular period of grace after
default (which period may be shorter or longer than that allowed in the
case of other defaults) or may provide for an immediate enforcement upon
such default or may limit the remedies available to the Trustee upon such
default;
(e) to provide for the issuance under this Indenture of Securities in
coupon form (including Securities registrable as to principal only) and to
provide for exchangeability of such Securities with the Securities issued
hereunder in fully registered form and to make all appropriate changes for
such purpose;
(f) to cure any ambiguity or to correct or supplement any provision
contained herein or in any supplemental indenture which may be defective or
inconsistent with any other provision contained herein or in any
supplemental indenture, or to make such other provisions in regard to
matters or questions arising under this Indenture which shall not
materially adversely affect the interests of the holders of the Securities;
(g) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities; or
(h) to modify, eliminate or add to the provisions of this Indenture
to such extent as shall be necessary to effect the qualification of this
Indenture under the Trust Indenture Act, or under any similar federal
statute hereafter enacted.
-57-
The Trustee is hereby authorized to join with the Company in the execution
of any such supplemental indenture, to make any further appropriate agreements
and stipulations which may be therein contained and to accept the conveyance,
transfer and assignment of any property thereunder, but the Trustee shall not be
obligated to, but may in its discretion, enter into any supplemental indenture
which affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any supplemental indenture authorized by the provisions of this Section
-------
11.1 may be executed by the Company and the Trustee without the consent of the
----
holders of any of the Securities at the time outstanding, notwithstanding any of
the provisions of Section 11.2.
------------
Section 11.2. Supplemental Indentures with Consent of Securityholders.
-------------------------------------------------------
With the consent (evidenced as provided in Article IX) of the holders of not
----------
less than a majority in aggregate principal amount of the Securities at
the time outstanding determined in accordance with Section 9.4, the Company,
-----------
when authorized by the resolutions of the Board of Directors, and the
Trustee may from time to time and at any time enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
any supplemental indenture or of modifying in any manner the rights of the
holders of the Securities; provided, however, that no such supplemental
-------- -------
indenture shall (i) extend the fixed maturity of any Security, or
reduce the rate or extend the time of payment of interest thereon, or reduce the
principal amount thereof or premium, if any, thereon, or reduce any amount
payable on redemption thereof, or impair the right of any Securityholder to
institute suit for the payment thereof, or make the principal thereof or
interest or premium, if any, thereon payable in any coin or currency other than
that provided in the Securities, or modify the provisions of this Indenture with
respect to the subordination of the Securities in a manner adverse to the
Securityholders in any material respect, or change the obligation of the Company
to repurchase any Security upon the occurrence of a Change in Control in a
manner adverse to the holder of Securities, or impair the right to convert the
Securities into Common Stock in any material respect, without the consent of the
holder of each Security so affected, or (ii) reduce the aforesaid percentage of
Securities, the holders of which are required to consent to any such
supplemental indenture, without the consent of the holders of all Securities
then outstanding.
Upon the request of the Company, accompanied by a copy of the resolutions
of the Board of Directors certified by its Secretary or an Assistant Secretary
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects
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the Trustee's own rights, duties or immunities under this Indenture or
otherwise, in which case the Trustee may in its discretion, but shall not be
obligated to, enter into such supplemental indenture.
It shall not be necessary for the consent of the Securityholders under this
Section 11.2 to approve the particular form of any proposed supplemental
------------
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Section 11.3. Effect of Supplemental Indenture. Any supplemental indenture
--------------------------------
executed pursuant to the provisions of this Article XI shall comply with the
----------
Trust Indenture Act, as then in effect. Upon the execution of any supplemental
indenture pursuant to the provisions of this Article XI, this Indenture shall be
----------
and be deemed to be modified and amended in accordance therewith and the
respective rights, limitation of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Company and the holders of Securities
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
Section 11.4. Notation on Security. Securities authenticated and delivered
--------------------
after the execution of any supplemental indenture pursuant to the provisions of
this Article XI may bear a notation in form approved by the Trustee as to any
----------
matter provided for in such supplemental indenture. If the Company or the
Trustee shall so determine, new Securities so modified as to conform, in the
opinion of the Trustee and the Board of Directors, to any modification of this
Indenture contained in any such supplemental indenture may, at the Company's
expense, be prepared and executed by the Company, authenticated by the Trustee
(or an authenticating agent duly appointed by the Trustee pursuant to Section
-------
17.11) and delivered in exchange for the Securities then outstanding, upon
-----
surrender of such Securities then outstanding.
Section 11.5. Evidence of Compliance of Supplemental Indenture to Be
------------------------------------------------------
Furnished Trustee. The Trustee, subject to the provisions of Sections 8.1 and
----------------- ------------
8.2, may receive an Officers' Certificate and an Opinion of Counsel as
---
conclusive evidence that any supplemental indenture executed pursuant hereto
complies with the requirements of this Article XI.
----------
ARTICLE XII
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
Section 12.1. Company May Consolidate Etc. on Certain Terms. Subject to
---------------------------------------------
the provisions of Section 12.2, nothing contained in this Indenture or in any of
------------
the Securities shall prevent any consolidation or merger of the Company with or
into
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any other corporation or corporations (whether or not affiliated with the
Company), or successive consolidations or mergers in which the Company or its
successor or successors shall be a party or parties, or shall prevent any sale,
conveyance or lease (or successive sales, conveyances or leases) of the property
of the Company, substantially as an entirety, to any other corporation (whether
or not affiliated with the Company), authorized to acquire and operate the same
and which, in each case, shall be organized under the laws of the United States
of America, any state thereof or the District of Columbia; provided, that upon
--------
any such consolidation, merger, sale, conveyance or lease, (i) the due and
punctual payment of the principal of and premium, if any, and interest on all of
the Securities, according to their tenor, and the due and punctual performance
and observance of all of the covenants and conditions of this Indenture to be
performed by the Company, shall be expressly assumed, by supplemental indenture
satisfactory in form to the Trustee, executed and delivered to the Trustee by
the corporation (if other than the Company) formed by such consolidation, or
into which the Company shall have been merged, or by the corporation which shall
have acquired or leased such property, and such supplemental indenture shall
provide for the applicable conversion rights set forth in Section 15.6. and (ii)
------------
immediately before and immediately after giving effect to such transaction, no
default or Event of Default shall have occurred and be continuing.
Section 12.2. Successor Corporation to Be Substituted. In case of any such
---------------------------------------
consolidation, merger, sale, conveyance or lease and upon the assumption by the
successor corporation, by supplemental indenture, executed and delivered to the
Trustee and satisfactory in form to the Trustee, of the due and punctual payment
of the principal of and premium, if any, and interest on all of the Securities
and the due and punctual performance of all of the covenants and conditions of
this Indenture to be performed by the Company, such successor corporation shall
succeed to and be substituted for the Company, with the same effect as if it had
been named herein as such. Such successor corporation thereupon may cause to be
signed, and may issue either in its own name or in the name of the Company any
or all of the Securities issuable hereunder which theretofore shall not have
been signed by the Company and delivered to the Trustee and, upon the order of
such successor corporation instead of the Company and subject to all the terms,
conditions and limitations in this Indenture prescribed, the Trustee shall
authenticate and shall deliver, or cause to be authenticated and delivered, any
Securities which previously shall have been signed and delivered by the officers
of the Company to the Trustee for authentication, and any Securities which such
successor corporation thereafter shall cause to be signed and delivered to the
Trustee for that purpose. All the Securities so issued shall in all respects
have the same legal rank and benefit under this Indenture as the Securities
theretofore or thereafter issued in accordance with the terms of this Indenture
as though all of such Securities had been issued at the date of the execution
hereof. In the event of any such
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consolidation, merger, sale or conveyance (but not in the event of any such
lease), the person named as the "Company" in the first paragraph of this
Indenture or any successor which shall thereafter have become such in the manner
prescribed in this Article XII shall be released from
-----------
its liabilities as obligor and maker of the Securities and from its obligations
under this Indenture.
In case of any such consolidation, merger, sale, conveyance or lease, such
changes in phraseology and form (but not in substance) may be made in the
Securities thereafter to be issued as may be appropriate.
Section 12.3. Opinion of Counsel to Be Given Trustee. The Trustee,
--------------------------------------
subject to Sections 8.1 and 8.2, shall receive an Officers' Certificate and an
------------ ---
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
sale, conveyance or lease and any such assumption complies with the provisions
of this Article XII.
-----------
ARTICLE XIII
SATISFACTION AND DISCHARGE OF INDENTURE
Section 13.1. Discharge of Indenture. When (a) the Company shall deliver to
----------------------
the Trustee for cancellation all Securities theretofore authenticated (other
than any Securities which have been destroyed, lost or stolen and in lieu of or
in substitution for which other Securities shall have been authenticated and
delivered) and not theretofore canceled, or (b) all the Securities not
theretofore canceled or delivered to the Trustee for cancellation shall have
become due and payable, or are by their terms to become due and payable within
one year or are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption, and the
Company shall deposit with the Trustee, in trust, monies sufficient to pay at
maturity or upon redemption of all of the Securities (other than any Securities
which shall have been mutilated, destroyed, lost or stolen and in lieu of or in
substitution for which other Securities shall have been authenticated and
delivered) not theretofore canceled or delivered to the Trustee for
cancellation, including principal and premium, if any, and interest due or to
become due to such date of maturity or redemption date, as the case may be, and
if in either case the Company shall also pay or cause to be paid all other sums
payable hereunder by the Company, then this Indenture shall cease to be of
further effect (except as to (i) remaining rights of registration of transfer,
substitution and exchange and conversion of Securities, (ii) rights hereunder of
Securityholders to receive payments of principal of and premium, if any, and
interest on, the Securities and the other rights, duties and obligations of
Securityholders, as beneficiaries hereof with respect to the amounts, if any, so
deposited with the Trustee and (iii) the rights, obligations and immunities of
the
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Trustee hereunder), and the Trustee, on demand of the Company accompanied by
an Officers' Certificate and an Opinion of Counsel as required by Section 17.5
------------
and at the cost and use of the Company, shall execute proper instruments
acknowledging satisfaction of and discharging this Indenture; the Company,
however, hereby agreeing to reimburse the Trustee for any costs or expenses
thereafter reasonably and properly incurred by the Trustee and to compensate the
Trustee for any services thereafter reasonably and properly rendered by the
Trustee in connection with this Indenture or the Securities.
Section 13.2. Deposited Monies to Be Held in Trust by Trustee. Subject to
-----------------------------------------------
Section 13.4, all monies deposited with the Trustee pursuant to Section 13.1 and
------------ ------------
not in violation of Article IV shall be held in trust for the sole benefit of
----------
the Securityholders and not to be subject to the subordination provisions of
Article IV, and such monies shall be applied by the Trustee to the payment,
----------
either directly or through any paying agent (including the Company if acting as
its own paying agent), to the holders of the particular Securities for the
payment or redemption of which such monies have been deposited with the Trustee,
of all sums due and to become due thereon for principal and interest and
premium, if any.
Section 13.3. Paying Agent to Repay Monies Held. Upon the satisfaction and
---------------------------------
discharge of this Indenture, all monies then held by any paying agent for the
Securities (other than the Trustee) shall, upon written request of the Company,
be repaid to the Company or paid to the Trustee, and thereupon such paying agent
shall be released from all further liability with respect to such monies.
Section 13.4. Return of Unclaimed Monies. Subject to the requirements of
--------------------------
applicable law, any monies deposited with or paid to the Trustee for payment of
the principal of, premium, if any, or interest on Securities and not applied but
remaining unclaimed by the holders of Securities for two years after the date
upon which the principal of, premium, if any, or interest on such Securities, as
the case may be, shall have become due and payable, shall be repaid to the
Company by the Trustee on demand and all liability of the Trustee shall
thereupon cease with respect to such monies and the holder of any of the
Securities shall thereafter look only to the Company for any payment which such
holder may be entitled to collect unless an applicable abandoned property law
designates another Person.
Section 13.5. Reinstatement. If the Trustee or the paying agent is unable
-------------
to apply any money in accordance with Section 13.2 by reason of any order or
------------
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 13.1 until such time as the Trustee or
------------
the paying agent is permitted to
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apply all such money in accordance with Section 13.2; provided, however, that if
------------- -------- -------
the Company makes any payment of interest or premium, if any, on or principal of
any Security following the reinstatement of its obligations, the Company shall
be subrogated to the rights of the holders of such Securities to receive such
payment from the money held by the Trustee or paying agent.
ARTICLE XIV
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
Section 14.1. Indenture and Securities Solely Corporate Obligations. No
-----------------------------------------------------
recourse for the payment of the principal of or premium, if any, or interest on
any Security, or for any claim based thereon or otherwise in respect thereof,
and no recourse under or upon any obligation, covenant or agreement of the
Company in this Indenture or in any supplemental indenture or in any Security,
or because of the creation of any indebtedness represented thereby, shall be had
against any incorporator, stockholder, employee, agent, officer, or director or
subsidiary, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, it being expressly
understood that all such liability is hereby expressly waived and released as a
condition of, and as a consideration for, the execution of this Indenture and
the issue of the Securities.
ARTICLE XV
CONVERSION OF SECURITIES
Section 15.1. Right to Convert. Subject to and upon compliance with the
----------------
provisions of this Indenture, the holder of any Security shall have the right,
at any time prior to the close of business on September 15, 2002 (except that,
with respect to any Security or portion of a Security which shall be called for
redemption, such right shall terminate, except as provided in Section 15.2 or
------------
Section 3.4, at the close of business on the Business Day immediately preceding
-----------
the date fixed for redemption of such Security or portion of a Security, unless
the Company shall default in payment due upon redemption thereof) to convert the
principal amount of any such Security, or any portion of such principal amount
which is $1,000 or an integral multiple thereof, into that number of fully paid
and non-assessable shares of Common Stock (as such shares shall then be
constituted) obtained by dividing the principal amount of the Security or
portion thereof surrendered for conversion by the Conversion Price in effect at
such time, by surrender of the Security so to be converted in whole or in part
in the manner provided, together with any required funds, in Section 15.2. A
------------
holder of Securities is not entitled to any rights of a holder of Common Stock
until
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such holder has converted his Securities to Common Stock, and only to the
extent such Securities are deemed to have been converted to Common Stock under
this Article XV.
----------
Section 15.2. Exercise of Conversion Privilege; Issuance of Common Stock on
-------------------------------------------------------------
Conversion; No Adjustment for Interest or Dividends. In order to exercise the
---------------------------------------------------
conversion privilege with respect to any Security, the holder of any such
Security to be converted in whole or in part shall surrender such Security, duly
endorsed, at an office or agency maintained by the Company pursuant to Section
-------
5.2, accompanied by the funds, if any, required by the last paragraph of this
---
Section 15.2, and shall give written notice of conversion in the form provided
------------
on the Securities (or such other notice which is acceptable to the Company) to
the office or agency that the holder elects to convert such Security or the
portion thereof specified in said notice. Such notice shall also state the name
or names (with address or addresses) in which the certificate or certificates
for shares of Common Stock which shall be issuable on such conversion shall be
issued, and shall be accompanied by transfer taxes, if required pursuant to
Section 15.7. Each such Security surrendered for conversion shall, unless the
------------
shares issuable on conversion are to be issued in the same name as the
registration of such Security, be duly endorsed by, or be accompanied by
instruments of transfer in form satisfactory to the Company duly executed by,
the holder or his duly authorized attorney.
In order to exercise the conversion privilege with respect to any interest
in a Security in global form, the beneficial holder must complete the
appropriate instruction form for conversion pursuant to the Depository's book-
entry conversion program, deliver by book-entry delivery an interest in such
Security in global form, furnish appropriate endorsements and transfer documents
if required by the Company or the Trustee or conversion agent, and pay the
funds, if any, required by this Section 15.2 and any transfer taxes if required
pursuant to Section 15.7.
As promptly as practicable after satisfaction of the requirements for
conversion set forth above, subject to compliance with any restrictions on
transfer if shares issuable on conversion are to be issued in a name other than
that of the Securityholder (as if such transfer were a transfer of the Security
or Securities (or portion thereof) so converted), the Company shall issue and
shall deliver to such holder at the office or agency maintained by the Company
for such purpose pursuant to Section 5.2, a certificate or certificates for the
-----------
number of full shares of Common Stock issuable upon the conversion of such
Security or portion thereof in accordance with the provisions of this Article
and a check or cash in respect of any fractional interest in respect of a share
of Common Stock arising upon such conversion, as provided in Section 15.3. In
------------
case any Security of a denomination greater than $1,000 shall be surrendered for
partial conversion, and subject to Section 2.3, the Company shall execute and
-----------
the Trustee shall authenticate and deliver to the holder of the Security so
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surrendered, without charge to him, a new Security or Securities in authorized
denominations in an aggregate principal amount equal to the unconverted portion
of the surrendered Security.
Each conversion shall be deemed to have been effected as to any such
Security (or portion thereof) on the date on which the requirements set forth
above in this Section 15.2 have been satisfied as to such Security (or portion
------------
thereof), and the person in whose name any certificate or certificates for
shares of Common Stock shall be issuable upon such conversion shall be deemed to
have become on said date the holder of record of the shares represented thereby;
provided, however, that any such surrender on any date when the stock transfer
-------- -------
books of the Company shall be closed shall constitute the person in whose name
the certificates are to be issued as the record holder thereof for all purposes
on the next succeeding day on which such stock transfer books are open, but such
conversion shall be at the Conversion Price in effect on the date upon which
such Security shall be surrendered.
Any Security or portion thereof surrendered for conversion during the
period from the close of business on the record date for any interest payment
date to the close of business on the Business Day next preceding the following
interest payment date shall (unless such Security or portion thereof being
converted shall have been called for redemption during the period from the close
of business on such record date to the close of business on the Business Day
next preceding the following interest payment date) be accompanied by payment,
in immediately available funds or other funds acceptable to the Company, of an
amount equal to the interest payable on such interest payment date on the
principal amount being converted; provided, however, that no such payment need
-------- -------
be made if there shall exist at the time of conversion a default in the payment
of interest on the Securities. In the event a Security or portion thereof is
called for redemption and the holder elects to convert such Security after it
has been called for redemption, the holder will be entitled to receive interest
on such Security for the period from the last interest payment date through the
date of conversion. Except as provided above in this Section 15.2, no
------------
adjustment shall be made for interest accrued on any Security converted or for
dividends on any shares issued upon the conversion of such Security as provided
in this Article.
Upon the conversion of an interest in a Security in global form, the
Trustee, or the Custodian at the direction of the Trustee, shall make a notation
on such Security in global form as to the reduction in the principal amount
represented thereby.
Section 15.3. Cash Payments in Lieu of Fractional Shares. No fractional
------------------------------------------
shares of Common Stock or scrip representing fractional shares shall be issued
upon conversion of Securities. If more than one Security shall be surrendered
for conversion at one time by the same holder, the number of full shares which
shall be issuable upon conversion shall be computed on the basis of the
aggregate principal amount of the Securities (or specified
-65-
portions thereof to the extent permitted hereby) so surrendered. If any
fractional share of stock would be issuable upon the conversion of any Security
or Securities, the Company shall make an adjustment and payment therefor in cash
at the current market value thereof to the holder of Securities. The current
market value of a share of Common Stock shall be the Closing Price on the first
Trading Day immediately preceding the day on which the Securities (or specified
portions thereof) are deemed to have been converted.
Section 15.4. Conversion Price. The conversion price shall be as
----------------
specified in the form of Security (herein called the "Conversion Price")
----------------
attached as Exhibit A hereto, subject to adjustment as provided in this Article
--------- -------
XV.
--
Section 15.5. Adjustment of Conversion Price. The Conversion Price shall
------------------------------
be adjusted from time to time by the Company 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 of which the numerator
shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination and the denominator shall
be the sum of such number of shares and the total number of shares
constituting such dividend or other distribution, such reduction to become
effective immediately after the opening of business on the day following
the date fixed for such determination. The Company will not pay any
dividend or make any distribution on shares of Common Stock held in the
treasury of the Company. If any dividend or distribution of the type
described in this Section 15.5(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 Company shall issue rights or warrants to all holders
of its outstanding shares of Common Stock entitling them (for a period
expiring within 45 days after the date fixed for determination of
stockholders entitled to receive such rights or warrants) to subscribe for
or purchase shares of Common Stock at a price per share less than the
Current Market Price (as defined below) on the date fixed for 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 immediately prior to the date
fixed for determination of stockholders
-66-
entitled to receive such rights or warrants by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding at the
close of business on the date fixed for determination of stockholders
entitled to receive such rights and warrants plus the number of shares
which the aggregate offering price of the total number of shares so offered
would purchase at such Current Market Price, and of which the denominator
shall be the number of shares of Common Stock outstanding on the date fixed
for determination of stockholders entitled to receive such rights and
warrants plus the total number of additional shares of Common Stock offered
for subscription or purchase. Such adjustment shall be successively made
whenever any such rights and warrants are issued, and shall become
effective immediately after the opening of business on the day following
the date fixed for determination of stockholders entitled to receive such
rights or warrants. To the extent that shares of Common Stock are not
delivered after the expiration 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 delivery of only the number of shares of
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 shares of Common Stock at less
than such Current Market Price, and in determining the aggregate offering
price of such shares of Common Stock, there shall be taken into account any
consideration received by the Company for such rights or warrants, the
value of such consideration, if other than cash, to be determined by the
Board of Directors.
(c) In case outstanding shares of Common Stock shall be subdivided
into a greater number of shares of Common Stock, the Conversion Price in
effect at the opening of business on the day following the day upon which
such subdivision becomes effective shall be proportionately reduced, and
conversely, in case outstanding shares of Common Stock shall be combined
into a smaller number of shares of Common Stock, the Conversion Price in
effect at the opening of business on the day following the day upon which
such combination becomes effective shall be proportionately increased, such
reduction or increase, as the case may be, to become effective immediately
after the opening of business on the day following the day upon which such
subdivision or combination becomes effective.
(d) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock
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shares of any class of capital stock of the Company (other than any
dividends or distributions to which Section 15.5(a) applies) or evidences
---------------
of its indebtedness or assets (including securities, but excluding any
rights or warrants referred to in Section 15.5(b), and excluding any
---------------
dividend or distribution paid exclusively in cash (any of the foregoing
hereinafter in this Section 15.5(d) called the "New Securities")), then, in
--------------- --------------
each such case (unless the Company elects to reserve such New Securities
for distribution to the Securityholders upon the conversion of the
Securities so that any such holder converting Securities will receive upon
such conversion, in addition to the shares of Common Stock to which such
holder is entitled, the amount and kind of such New Securities which such
holder would have received if such holder had converted its Securities into
Common Stock immediately prior to the Record Date (as defined in Section
-------
15.5(h) for such distribution of the New Securities)), the Conversion Price
------
shall be reduced so that the same shall be equal to the price determined by
multiplying the Conversion Price in effect on the Record Date with respect
to such distribution by a fraction of which the numerator shall be the
Current Market Price per share of the Common Stock on such Record Date less
the fair market value (as determined by the Board of Directors, whose
determination shall be conclusive, and described in a resolution of the
Board of Directors) on the Record Date of the portion of the Securities so
distributed applicable to one share of Common Stock and the denominator
shall be the Current Market Price per share of the Common Stock, such
reduction to become effective immediately prior to the opening of business
on the day following such Record Date; provided, however, that in the event
-------- -------
the then fair market value (as so determined) of the portion of the New
Securities so distributed applicable to one share of Common Stock is equal
to or greater than the Current Market Price of the Common Stock on the
Record Date, in lieu of the foregoing adjustment, adequate provision shall
be made so that each Securityholder shall have the right to receive upon
conversion the amount of New Securities such holder would have received had
such holder converted each Security on the Record Date. In the event that
such dividend or distribution is not so paid or made, the Conversion Price
shall again be adjusted to be the Conversion Price which would then be in
effect if such dividend or distribution had not been declared. If the Board
of Directors determines the fair market value of any distribution for
purposes of this Section 15.5(d) by reference to the actual or when issued
---------------
trading market for any securities, it must in doing so consider the prices
in such market over the same period used in computing the Current Market
Price of the Common Stock.
In the event the Company implements a stockholder rights plan, such
rights plan shall provide that upon conversion of the Securities the
holders will receive, in addition to the
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Common Stock issuable upon such conversion, the rights issued under such
rights plan (notwithstanding the occurrence of an event causing such rights
to separate from the Common Stock at or prior to the time of conversion).
Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of
the Company's capital stock (either initially or under certain
circumstances), which rights or warrants, until the occurrence of a
specified event or events ("Trigger Event"): (i) are deemed to be
-------------
transferred with such shares of Common Stock, (ii) are not exercisable, and
(iii) are also issued in respect of future issuances of Common Stock, shall
be deemed not to have been distributed for purposes of this Section 15.5
------------
(and no adjustment to the Conversion Price under this Section 15.5 will be
------------
required) until the occurrence of the earliest Trigger Event, whereupon
such rights and warrants shall be deemed to have been distributed and an
appropriate adjustment (if any is required) to the Conversion Price shall
be made under this Section 15.5(d). If any such right or warrant,
---------------
including any such existing rights or warrants distributed prior to the
date of this Indenture, are subject to events, upon the occurrence of which
such rights or warrants become exercisable to purchase different
securities, evidences of indebtedness or other assets, then the date of the
occurrence of any and each such event shall be deemed to be the date of
distribution and record date with respect to new rights or warrants with
such rights (and a termination or expiration of the existing rights or
warrants without exercise by any of the holders thereof). In addition, in
the event of any distribution (or deemed distribution) of rights or
warrants, or any Trigger Event or other event (of the type described in the
preceding sentence) with respect thereto that was counted for purposes of
calculating a distribution amount for which an adjustment to the Conversion
Price under this Section 15.5 was made, (1) in the case of any such rights
------------
or warrants which shall all have been redeemed or repurchased without
exercise by any holders thereof, the Conversion Price shall be readjusted
upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price
received by a holder or holders 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 repurchase, and (2) in the case of such rights or warrants
which shall have expired or been terminated without exercise by any holders
thereof, the Conversion Price shall be readjusted as if such rights and
warrants had not been issued.
For purposes of this Section 15.5(d) and Sections 15.5(a) and (b), any
--------------- ---------------- ---
dividend or distribution to which this Section 15.5(d) is applicable that
---------------
also includes shares of
-69-
Common Stock, or rights or warrants to subscribe for or purchase shares of
Common Stock shall be deemed instead to be (1) a dividend or distribution
of the evidences of indebtedness, assets or shares of capital stock other
than such shares of Common Stock or rights or warrants (and any further
Conversion Price reduction required by this Section 15.5(d) with respect to
---------------
such dividend or distribution shall then be made) immediately followed by
(2) a dividend or distribution of such shares of Common Stock or such
rights or warrants (and any further Conversion Price reduction required by
Sections 15.5(a) and (b) with respect to such dividend or distribution
---------------- ---
shall then be made), except (A) the Record Date of such dividend or
distribution shall be substituted as "the date fixed for the determination
of stockholders entitled to receive such dividend or other distribution"
and "the date fixed for such determination" within the meaning of Sections
--------
15.5(a) and (b) and (B) any shares of Common Stock included in such
----- ---
dividend or distribution shall not be deemed "outstanding at the close of
business on the date fixed for such determination" within the meaning of
Section 15.5(a).
---------------
(e) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Common Stock cash (excluding any cash that is
distributed upon a merger or consolidation to which Section 15.6 applies or
------------
as part of a distribution referred to in Section 15.5(d)) in an aggregate
---------------
amount that, combined together with (1) the aggregate amount of any other
such distributions to all holders of its Common Stock made exclusively in
cash within the 12 months preceding the date of payment of such
distribution, and in respect of which no adjustment pursuant to this
Section 15.5(e) has been made, and (2) the aggregate of any cash plus the
---------------
fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a resolution of the
Board of Directors) of consideration payable in respect of any tender offer
by the Company for all or any portion of the Common Stock concluded within
the 12 months preceding the date of payment of such distribution, and in
respect of which no adjustment pursuant to Section 15.5(f) has been made,
---------------
exceeds 10% of the product of the Current Market Price (determined as
provided in Section 15.5(h)) on the Record Date with respect to such
---------------
distribution times the number of shares of Common Stock outstanding on such
date, then, immediately after the close of business on such date, the
Conversion Price shall be reduced so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior
to the close of business on such Record Date by a fraction (i) the
numerator of which shall be equal to the Current Market Price on the Record
Date less an amount equal to the quotient of (x) the excess of such
combined amount over such 10% and (y) the number of shares of Common Stock
outstanding on the Record Date and (ii) the denominator of which shall be
equal to the Current Market Price on such
-70-
Record Date; provided, however, 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 of the Common Stock on the Record Date, in
lieu of the foregoing adjustment, adequate provision shall be made so that
each Securityholder shall have the right to receive upon conversion the
amount of cash such holder would have received had such Holder converted
such Security immediately prior to such 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 which would then be in effect if such
dividend or distribution had not been declared.
(f) In case a tender offer made by the Company or any of its
subsidiaries for all or any portion of the Common Stock expires and such
tender offer (as amended upon the expiration thereof) requires the payment
to stockholders (based on the acceptance (up to any maximum specified in
the terms of the tender offer) of Purchased Shares (as defined below)) of
an aggregate consideration having a fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and described
in a resolution of the Board of Directors) that, combined together with (1)
the aggregate of the cash plus the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and described
in a resolution of the Board of Directors), as of the expiration of such
tender offer, of consideration payable in respect of any other tender
offers, by the Company or any of its subsidiaries for all or any portion of
the Common Stock expiring within the 12 months preceding the expiration of
such tender offer and in respect of which no adjustment pursuant to this
Section 15.5(f) has been made and (2) the aggregate amount of any
---------------
distributions to all holders of the Common Stock made exclusively in cash
within 12 months preceding the expiration of such tender offer and in
respect of which no adjustment pursuant to Section 15.5(e) has been made,
---------------
exceeds 10% of the product of the Current Market Price (determined as
provided in Section 15.5(h)) as of the last time (the "Expiration Time")
--------------- ---------------
tenders could have been made pursuant to such tender offer (as it may be
amended) times the number of shares of Common Stock outstanding (including
any tendered shares) at the Expiration Time, then, and in each such case,
immediately prior to the opening of business on the day after the date of
the Expiration Time, the Conversion Price shall be adjusted so that the
same shall equal the price determined by multiplying the Conversion Price
in effect immediately prior to the close of business on the date of the
Expiration Time by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding (including any tendered shares) at the
Expiration Time multiplied by the Current Market Price of the Common Stock
on the Trading Day next succeeding the
-71-
Expiration Time and the denominator shall be the sum of (x) the fair market
value (determined as aforesaid) of the aggregate consideration payable to
stockholders based on the acceptance (up to any maximum specified in the
terms of the tender offer) of all shares validly tendered 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 Current Market Price of the Common
Stock on the Trading Day next succeeding the Expiration Time, such
reduction (if any) to become effective immediately prior to the opening of
business on the day following the Expiration Time. If the Company is
obligated to purchase shares pursuant to any such tender offer, but the
Company is permanently prevented by applicable law from effecting any such
purchases or all such purchases are rescinded, the Conversion Price shall
again be adjusted to be the Conversion Price which would then be in effect
if such tender offer had not been made. If the application of this Section
-------
15.5(f) to any tender offer would result in an increase in the Conversion
-------
Price, no adjustment shall be made for such tender offer under this Section
-------
15.5(f) .
-------
(g) In case of a tender or exchange offer made by a person other than
the Company or any subsidiary of the Company for an amount which increases
the offeror's ownership of Common Stock to more than 20% of the Common
Stock outstanding and shall involve the payment by such person 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 described in a resolution of the Board of Directors) at the
Expiration Time that exceeds the Current Market Price of the Common Stock
on the Trading Day next succeeding the Expiration Time, and in which, as of
the Expiration Time the Board of Directors is not recommending rejection of
the offer, 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 of which the
numerator shall be the number of shares of Common Stock outstanding
(including any tendered or exchanged shares) on the Expiration Time
multiplied by the Current Market Price of the Common Stock on the Trading
Day next succeeding the Expiration Time and the denominator shall be the
sum of (x) the fair market value (determined as aforesaid) of the aggregate
consideration payable to stockholders based on the acceptance (up to any
maximum specified in the terms of the tender 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) on the
-72-
Expiration Time and the Current Market Price of the Common Stock on the
Trading Day next succeeding the Expiration Time, such reduction to become
effective as of immediately prior to the opening of business on the day
following the Expiration Time. In the event that such person is obligated
to purchase shares pursuant to any such tender or exchange offer, but such
person is permanently prevented by applicable law from effecting any such
purchases or all such purchases are rescinded, the Conversion Price shall
again be adjusted to be the Conversion Price which would then be in effect
if such tender or exchange offer had not been made. Notwithstanding the
foregoing, the adjustment described in this Section 15.5(g) shall not be
---------------
made if, as of the Expiration Time, the offering documents with respect to
such offer disclose a plan or intention to cause the Company to engage in
any transaction described in Article XII .
-----------
(h) For purposes of this Section 15.5, the following terms shall have
------------
the meaning indicated:
(1) "Closing Price" with respect to any securities on any day
-------------
shall mean the closing sale price regular way on such day or, in case
no such sale takes place on such day, the average of the reported
closing bid and asked prices, regular way, in each case on the New
York Stock Exchange, or, if such security is not listed or admitted to
trading on such Exchange, on the principal national security exchange
or quotation system on which such security is quoted or listed or
admitted to trading, or, if not quoted or listed or admitted to
trading on any national securities exchange or quotation system, the
average of the closing bid and asked prices of such security on the
over-the-counter market on the day in question as reported by the
National Quotation Bureau Incorporated, or a similar generally
accepted reporting service, or if not so available, in such manner as
furnished by any New York Stock Exchange member firm selected from
time to time by the Board of Directors for that purpose, or a price
determined in good faith by the Board of Directors or, to the extent
permitted by applicable law, a duly authorized committee thereof,
whose determination shall be conclusive.
(2) "Current Market Price" shall mean the average of the daily
--------------------
Closing Prices per share of Common Stock for the ten consecutive
Trading Days immediately prior to the date in question; provided,
--------
however, that (1) if 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 15.5(a), (b), (c), (d), (e), (f) or (g) occurs
--------------- --- --- --- --- --- ---
during such ten consecutive Trading Days, the Closing Price for each
Trading Day
-73-
prior to the "ex" date for such other event shall be adjusted by
multiplying such Closing Price by the same fraction by which the
Conversion Price is so required to be adjusted as a result of such
other event, (2) if 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 15.5(a),
---------------
(b), (c), (d), (e), (f) or (g) occurs on or after the "ex" date for
--- --- --- --- --- ---
the issuance or distribution requiring such computation and prior to
the day in question, the Closing Price for each Trading Day on and
after the "ex" date for such other event shall be adjusted by
multiplying such Closing Price by the reciprocal of the fraction by
which the Conversion Price is so required to be adjusted as a result
of such other event, and (3) if 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 (1) or (2) of this proviso, the Closing Price for each
Trading Day on or after such "ex" date shall be adjusted by adding
thereto the amount of any cash and the fair market value (as
determined by the Board of Directors or, to the extent permitted by
applicable law, a duly authorized committee thereof in a manner
consistent with any determination of such value for purposes of
Section 15.5(d), (f) or (g), whose determination shall be conclusive
--------------- --- ---
and described in a resolution of the Board of Directors or such duly
authorized committee thereof, as the case may be) of the evidences of
indebtedness, shares of capital stock or assets being distributed
applicable to one share of Common Stock as of the close of business
on the day before such "ex" date. For purposes of any computation
under Section 15.5(f) or (g), the Current Market Price of the Common
--------------- ---
Stock on any date shall be deemed to be the average of the daily
Closing Prices per share of Common Stock for such day and the next
two succeeding Trading Days; provided, however, that if the "ex" date
-------- -------
for any event (other than the tender or exchange offer requiring such
computation) that requires an adjustment to the Conversion Price
pursuant to Section 15.5(a), (b), (c), (d), (e), (f) or (g) occurs on
--------------- ---- --- --- --- --- ---
or after the Expiration Time for the tender or exchange offer
requiring such computation and prior to the day in question, the
Closing Price for each Trading Day on and after the "ex" date for such
other event shall be adjusted by multiplying such Closing Price by the
reciprocal of the fraction by which the Conversion Price is so
required to be adjusted as a result of such other event. For purposes
of this paragraph, the term "ex" date, (1) when used with respect to
any issuance or distribution, means the first date on which the Common
Stock trades regular way on the relevant
-74-
exchange or in the relevant market from which the Closing Price was
obtained without the right to receive such issuance or distribution,
(2) when used with respect to any subdivision or combination of shares
of Common Stock, means the first date on which the Common Stock trades
regular way on such exchange or in such market after the time at which
such subdivision or combination becomes effective, and (3) when used
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.
(3) "fair market value" shall mean the amount which a willing
-----------------
buyer would pay a willing seller in an arm's length transaction.
(4) "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 shareholders
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).
(5) "Trading Day" shall mean (x) if the applicable security is
-----------
listed or admitted for trading on the New York Stock Exchange or
another national security exchange, a day on which the New York Stock
Exchange or another national security exchange is open for business or
(y) if the applicable security is quoted on the Nasdaq National
Market, a day on which trades may be made thereon or (z) if the
applicable security is not so listed, admitted for trading or quoted,
any day other than a Saturday or Sunday or a day on which banking
institutions in the State of New York are authorized or obligated by
law or executive order to close.
(i) The Company may make such reductions in the Conversion Price, in
addition to those required by Sections 15.5(a), (b), (c), (d), (e), (f) and
---------------- --- --- --- --- ---
(g), as the Board of Directors considers to be advisable to avoid or
---
diminish any income tax to holders of Common Stock or rights to purchase
Common Stock resulting from any dividend or distribution of stock (or
rights to acquire stock) or from any event treated as such for income tax
purposes.
To the extent permitted by applicable law, the Company from time to
time may reduce the Conversion Price by any
-75-
amount for any period of time if the period is at least thirty (30) days,
the reduction is irrevocable during the period and the Board of Directors
shall have made a determination that such reduction would be in the best
interests of the Company, which determination shall be conclusive. Whenever
the Conversion Price is reduced pursuant to the preceding sentence, the
Company shall mail to holders of record of the Securities a notice of the
reduction at least fifteen (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 one
percent (1%) in such price; provided, however, that any adjustments which
-------- -------
by reason of this Section 15.5(j) are not required to be made shall be
---------------
carried forward and taken into account in any subsequent adjustment. All
calculations under this Article XV shall be made by the Company and shall
----------
be made to the nearest cent or to the nearest one hundredth of a share, as
the case may be.
(k) Whenever the Conversion Price is adjusted as herein provided, the
Company shall promptly file with the Trustee and any conversion agent other
than the Trustee an Officers' Certificate setting forth the Conversion
Price after such adjustment and setting forth a brief statement of the
facts requiring such adjustment. Promptly after delivery of such
certificate, the Company shall prepare a notice of such adjustment of the
Conversion Price setting forth the adjusted Conversion Price and the date
on which each adjustment becomes effective and shall mail notice of such
adjustment of the Conversion Price to the holder of each Security at his
last address appearing on the Security register provided for in Section 2.5
-----------
of this Indenture, within ten (10) days after execution thereof. Failure
to deliver such notice shall not affect the legality or validity of any
such adjustment.
(l) In any case in which this Section 15.5 provides that an
------------
adjustment shall become effective immediately after a record date for an
event, the Company may defer until the occurrence of such event (i) issuing
to the holder of any Security converted after such record date and before
the occurrence of such event the additional shares of Common Stock issuable
upon such conversion by reason of the adjustment required by such event
over and above such conversion by reason of the adjustment required by such
event 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 15.5.
------------
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(m) For purposes of this Section 15.5, 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.
Section 15.6 Effect of Reclassification, Consolidation, Merger or Sale.
---------------------------------------------------------
If any of the following events occur, namely (i) any reclassification or change
of the outstanding shares of Common Stock (other than a subdivision or
combination to which Section 15.5(c) applies), (ii) any consolidation, merger or
---------------
combination of the Company with another corporation as a result of which holders
of Common Stock shall be entitled to receive stock, securities or other property
or assets (including cash) with respect to or in exchange for such Common Stock,
or (iii) 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 the Company or the successor or purchasing corporation, as
the case may be, shall execute with the Trustee a supplemental indenture (which
shall comply with the Trust Indenture Act as in force at the date of execution
of such supplemental indenture) providing that such Security shall be
convertible into the kind and amount of shares of stock and other securities or
property or assets (including cash) receivable upon such reclassification,
change, consolidation, merger, combination, sale or conveyance by a holder of a
number of shares of Common Stock issuable upon conversion of such Securities
(assuming, for such purposes, a sufficient number of authorized shares of Common
Stock available to convert all such Securities) immediately prior to such
reclassification, change, consolidation, merger, combination, sale or conveyance
assuming such holder of Common Stock did not exercise his rights of election, if
any, as to the kind or amount of shares of stock and other securities or
property or assets (including cash) receivable upon such reclassification,
change, consolidation, merger, combination, sale or conveyance (provided that,
if the kind or amount of shares of stock and other securities or property or
assets (including cash) receivable upon such reclassification, change,
consolidation, merger, combination, sale or conveyance is not the same for each
share of Common Stock in respect of which such rights of election shall not have
been exercised ("nonelecting share"), then for the purposes of this Section
-------
15.6, the kind and amount of shares of stock and other securities or property or
----
assets (including cash) receivable upon such reclassification, change,
consolidation, merger, combination, sale or conveyance for each non-electing
share shall be deemed to be the kind and amount so receivable per share by a
plurality of the non-electing shares). Such supplemental
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indenture shall provide for adjustments which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Article.
The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each holder of Securities, at his address appearing on
the Security register provided for in Section 2.5 of this Indenture, within ten
-----------
(10) 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 similarly apply to successive
reclassifications, changes, consolidations, mergers, combinations, sales and
conveyances.
If this Section 15.6 applies to any event or occurrence, Section 15.5 shall
------------ ------------
not apply.
Section 15.7. Taxes on Shares Issued. The issue of stock certificates on
----------------------
conversions of Securities shall be made without charge to the converting
Securityholder for any tax in respect of the issue thereof. The Company shall
not, however, be required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of stock in any name other than that
of the holder of any Security converted, and the Company shall not be required
to issue or deliver any such stock certificate unless and until the person or
persons requesting the issue thereof shall have paid to the Company the amount
of such tax or shall have established to the satisfaction of the Company that
such tax has been paid.
Section 15.8. Reservation of Shares to Be Fully Paid; Compliance with
-------------------------------------------------------
Governmental Requirements; Listing of Common Stock. The Company shall reserve,
--------------------------------------------------
free from preemptive rights, out of its authorized but unissued shares or shares
held in treasury sufficient shares of Common Stock to provide for the conversion
of the Securities from time to time as such Securities are presented for
conversion.
Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value, if any, of the shares of Common Stock
issuable upon conversion of the Securities, the Company will take all corporate
action which may, in the opinion of its counsel, be necessary in order that the
Company may validly and legally issue shares of such Common Stock at such
adjusted Conversion Price.
The Company covenants that all shares of Common Stock which may be issued
upon conversion of Securities will upon issue be fully paid and non-assessable
by the Company and free from all taxes, liens and charges with respect to the
issue thereof.
The Company covenants that if any shares of Common Stock to be provided for
the purpose of conversion of Securities hereunder
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require registration with or approval of any governmental authority under any
federal or state law before such shares may be validly issued upon conversion,
the Company will in good faith and as expeditiously as possible endeavor to
secure such registration or approval, as the case may be.
The Company further covenants that if at any time the Common Stock shall be
listed on the New York Stock Exchange or any other national securities exchange
the Company will, if permitted by the rules of such exchange, list and keep
listed so long as the Common Stock shall be so listed on such exchange, all
Common Stock issuable upon conversion of the Securities.
Section 15.9 Responsibility of Trustee. The Trustee and any other
-------------------------
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 extent
or calculation of any such adjustment when made, or with respect to the method
employed, or herein or in any supplemental indenture provided to be employed, in
making the same. The Trustee and any other conversion agent shall not be
accountable with respect to the validity or value (or the kind or amount) of any
shares of Common Stock, or of any securities or property, which may at any time
be issued or delivered upon the conversion of any Security and the Trustee and
any other conversion agent make no representations with respect thereto.
Subject to the provisions of Section 8.1, neither the Trustee nor any conversion
-----------
agent shall be responsible for any failure of the Company to issue, transfer or
deliver any shares of Common Stock or stock certificates or other securities or
property or cash upon the surrender of any Security for the purpose of
conversion or to comply with any of the duties, responsibilities or covenants of
the Company contained in this Article. Without limiting the generality of the
foregoing, neither the Trustee nor any conversion agent shall be under any
responsibility to determine the correctness of any provisions contained in any
supplemental indenture entered into pursuant to Section 15.6 relating either to
------------
the kind or amount of shares of stock or securities or property (including cash)
receivable by Securityholders upon the conversion of their Securities after any
event referred to in such Section 15.6 or to any adjustment to be made with
------------
respect thereto, but, subject to the provisions of Section 8.1, may accept as
-----------
conclusive evidence of the correctness of any such provisions, and shall be
protected in relying upon, the Officers' Certificate (which the Company shall be
obligated to file with the Trustee prior to the execution of any such
supplemental indenture) with respect thereto.
Section 15.10 Notice to Holders Prior to Certain Actions. In case:
------------------------------------------
(a) the Company shall declare a dividend (or any other distribution)
on its Common Stock that would require an
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adjustment in the Conversion Price pursuant to Section 15.5; or
------------
(b) the Company shall authorize the granting to all or substantially
all the holders of its Common Stock of rights or warrants to subscribe for
or purchase any share of any class or any other rights or warrants; or
(c) of any reclassification or reorganization of the Common Stock of
the Company (other than a subdivision or combination of its outstanding
Common Stock, or a change in par value, or from par value to no par value,
or from no par value to par value), or of any consolidation or merger to
which the Company is a party and for which approval of any shareholders of
the Company is required, or of the sale or transfer of all or substantially
all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company;
the Company shall cause to be filed with the Trustee and to be mailed to each
holder of Securities at his address appearing on the Security register provided
for in Section 2.5 of this Indenture, as promptly as possible but in any event
-----------
at least fifteen (15) days prior to the applicable date hereinafter specified, a
notice stating (x) the date on which a record is to be taken for the purpose of
such dividend, distribution or rights or warrants, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution, or rights or warrants are to be determined, or
(y) the date on which such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding-up is expected to become effective
or occur, and the date as of which it is expected that holders of Common Stock
of record shall be entitled to exchange their Common Stock for securities or
other property deliverable upon such reclassification, consolidation, merger,
sale, transfer, dissolution, liquidation or winding-up. Failure to give such
notice, or any defect therein, shall not affect the legality or validity of such
dividend, distribution, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up.
ARTICLE XVI.
REPURCHASE OF SECURITIES AT
OPTION OF THE HOLDER UPON CHANGE IN CONTROL
Section 16.1 Right to Require Repurchase. In the event that a Change in
---------------------------
Control (as hereinafter defined) shall occur, then each holder shall have the
right, at the holder's option, to require the Company to repurchase, and upon
the exercise of such right the Company shall repurchase, all of such holder's
Securities, or any portion of the principal amount thereof that
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is an integral multiple of $1,000 (provided that no single Security may be
repurchased in part unless the portion of the principal amount of such Security
to be outstanding after such repurchase is equal to $1,000 or an integral
multiple of $1,000), on the date (the "Repurchase Date") that is 30 days after
---------------
the date of the Company Notice (as defined in Section 16.2) for cash at a
------------
purchase price equal to 100% of the principal amount (the "Repurchase Price")
----------------
plus interest accrued and unpaid interest to, but excluding, the Repurchase
Date. The Company covenants that, prior to the mailing of the Company Notice,
the Company shall (i) repay in full all Senior Indebtedness or offer to repay in
full all Senior Indebtedness the terms of which prohibit the payment of the
Securities prior to such Senior Indebtedness upon a Change in Control or (ii)
obtain the requisite consent of the holders of any such Senior Indebtedness to
permit the repurchase of the Securities pursuant to this Article XVI. The
Company shall first comply with the covenant in the preceding sentence before it
shall be required to repurchase Securities pursuant to this Article XVI. The
Company also covenants that, upon a Change in Control, the Company will not make
any payment to or for the benefit of any holder of any securities that are
"junior" in right of payment to the Securities (including, but not limited to,
holders of the New Preferred Stock), until a date following the Repurchase Date.
Whenever in this Indenture there is a reference, in any context, to the
principal of any Security as of any time, such reference shall be deemed to
include reference to the Repurchase Price payable in respect of such Security to
the extent that such Repurchase Price is, was or would be so payable at such
time, and express mention of the Repurchase Price in any provision of this
Indenture shall not be construed as excluding the Repurchase Price in those
provisions of this Indenture when such express mention is not made.
Section 16.2. Notices: Method of Exercising Repurchase Right, Etc.
----------------------------------------------------
(a) Unless the Company shall have theretofore called for redemption
all of the outstanding Securities pursuant to Article III, on or before the
-----------
15th day after the occurrence of a Change in Control, the Company or, at
the written request of the Company on or before the 10th day after receipt
of such request, the Trustee shall give to all holders of Securities notice
(the "Company Notice") of the occurrence of the Change in Control and of
--------------
the repurchase right set forth herein arising as a result thereof. The
Company shall also deliver a copy of such notice of a repurchase right to
the Trustee.
Each notice of a repurchase right shall state:
(1) the Repurchase Date,
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(2) the date by which the repurchase right must exercised,
(3) the Repurchase Price,
(4) a description of the procedure which a holder must follow to
exercise a repurchase right,
(5) that on the Repurchase Date the Repurchase Price will become
due and payable upon each such Security designated by the holder to be
repurchased, and that interest thereon shall cease to accrue on and
after said date,
(6) the Conversion Price, the date on which the right to convert
the Securities to be repurchased will terminate and the places where
such Securities may be surrendered for conversion, and
(7) the place or places where such Securities are to be
surrendered for payment of the Repurchase Price and accrued interest,
if any.
No failure of the Company to give the foregoing notices or defect therein
shall limit any holder's right to exercise a repurchase right or affect the
validity of the proceedings for the repurchase of Securities.
If any of the foregoing provisions or other provisions of this Article are
inconsistent with applicable law, such law shall govern.
(b) To exercise a repurchase right, a holder shall deliver to the
Trustee or any paying agent on or before the 30th day after the date of the
Company Notice (i) written notice of the holder's exercise of such right,
which notice shall set forth the name of the holder, the principal amount
of the Securities to be repurchased (and, if any Security is to be
repurchased in part, the serial number thereof, the portion of the
principal amount thereof to be repurchased and the name of the Person in
which the portion thereof to remain outstanding after such repurchase is to
be registered) and a statement that an election to exercise the repurchase
right is being made thereby, and (ii) the Securities with respect to which
the repurchase right is being exercised.
(c) In the event a repurchase right shall be exercised in accordance
with the terms hereof, the Company shall pay or cause to be paid to the
Trustee or the paying agent the Repurchase Price in cash, for payment to
the holder on the Repurchase Date, together with accrued and unpaid
interest to, but excluding, the Repurchase Date payable with respect
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to the Securities as to which the repurchase right has been exercised.
(d) If any Security (or portion thereof) surrendered for repurchase
shall not be so paid on the Repurchase Date, the principal amount of such
Security (or portion thereof, as the case may be) shall, until paid, bear
interest from the Repurchase Date at the rate of __% per annum, and each
Security shall remain convertible into Common Stock until the principal of
such Security (or portion thereof, as the case may be) shall have been paid
or duly provided for.
(e) Any Security which is to be repurchased only in part shall be
surrendered to the Trustee (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 his 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,
containing identical terms and conditions, each in an authorized
denomination in aggregate principal amount equal to and in exchange for the
portion of the principal of the Security so surrendered that was not
repurchased.
(f) Any holder that has delivered to the Trustee its written notice
exercising its right to require the Company to repurchase its Securities
upon a Change in Control shall have the right to withdraw such notice at
any time prior to the close of business on the Repurchase Date by delivery
of a written notice of withdrawal to the Trustee prior to the close of
business on such date. A Security in respect of which a holder is
exercising its option to require repurchase upon a Change in Control may be
converted into Common Stock in accordance with Article XV only if such
----------
holder withdraws its notice in accordance with the preceding sentence.
Section 16.3. Certain Definitions. For purposes of this Article XVI,
------------------- -----------
(a) the term "beneficial owner" shall be determined in accordance
with Rule 13d-3 promulgated by the Commission pursuant to the Exchange Act;
and
(b) the term "Person" shall include any syndicate or group which
would be deemed to be a "person" under Section 13(d)(3) of the Exchange
----------------
Act.
Section 16.4. Change in Control. A "Change in Control" shall be deemed
----------------- -----------------
to have occurred at such time after the original issuance of the Securities as:
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(a) any Person (other than the Company, any subsidiary of the
Company, or any entity Controlled by the foregoing, any officer of the
Company as of the date hereof or any employee benefit plan of the Company
or any such subsidiary) is or becomes the beneficial owner, directly or
indirectly, through a purchase or other acquisition transaction or series
of transactions (other than a merger or consolidation involving the
Company), of shares of capital stock of the Company entitling such Person
to exercise in excess of 35% of the total voting power of all shares of
capital stock of the Company entitled to vote generally in the election of
directors;
(b) there occurs any consolidation of the Company with, or merger of
the Company into, any other Person, any merger of another Person into the
Company, or any sale or transfer of the assets of the Company as, or
substantially as, an entirety to another Person (other than (i) any such
transaction pursuant to which the holders of the Common Stock immediately
prior to such transaction have, directly or indirectly, shares of capital
stock of the continuing or surviving corporation immediately after such
transaction which entitle such holders to exercise in excess of 50% of the
total voting power of all shares of capital stock of the continuing or
surviving corporation entitled to vote generally in the election of
directors and (ii) any merger (1) which does not result in any
reclassification, conversion, exchange or cancellation of outstanding
shares of Common Stock or (2) which is effected solely to change the
jurisdiction of incorporation of the Company and results in a
reclassification, conversion or exchange of outstanding shares of Common
Stock solely into shares of common stock and separate series of common
stock carrying substantially the same relative rights as the Common Stock);
or
(c) a change in the Board of Directors of the Company in which the
individuals who constituted the Board of Directors of the Company at the
beginning of the two-year period immediately preceding such change
(together with any other director whose election by the Board of Directors
of the Company or whose nomination for election by the stockholders of the
Company was approved by a vote of at least a majority of the directors then
in office either who were directors at the beginning of such period or
whose election or nomination for election was previously so approved) cease
for any reason to constitute a majority of the directors then in
office.
Section 16.5. Consolidation, Merger, Etc. In the case of any
---------------------------
reclassification, change, consolidation, merger, combination, sale or conveyance
to which Section 15.6 applies, in which the Common Stock of the Company is
------------
changed or exchanged as a result into the right to receive shares of stock and
other securities or property or assets (including cash) which includes shares of
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Common Stock of the Company or common stock of another person that are, or upon
issuance will be, traded on a United States national securities exchange or
approved for trading on an established automated over-the-counter trading market
in the United States and such shares constitute at the time such change or
exchange becomes effective in excess of 50% of the aggregate fair market value
of such shares of stock and other securities, property and assets (including
cash) (as determined by the Company, which determination shall be conclusive and
binding), then the person formed by such consolidation or resulting from such
merger or combination or which acquires the properties or assets (including
cash) of the Company, as the case may be, shall execute and deliver to the
Trustee a supplemental indenture (which shall comply with the Trust Indenture
Act as in force at the date of execution of such supplemental indenture)
modifying the provisions of this Indenture relating to the right of holders of
the Securities to cause the Company to repurchase the Securities following a
Change in Control, including, without limitation, the applicable provisions of
this Article XVI and the definitions of the Common Stock and Change in Control,
-----------
as appropriate, and such other related definitions set forth herein as
determined in good faith by the Company (which determination shall be conclusive
and binding), to make such provisions apply to the common stock and the issuer
thereof if different from the Company and Common Stock of the Company (in lieu
of the Company and the Common Stock of the Company).
ARTICLE XVII.
MISCELLANEOUS PROVISIONS
Section 17.1. Provisions Binding on Company's Successors. All the
------------------------------------------
covenants, stipulations, promises and agreements by the Company contained in
this Indenture shall bind its successors and assigns whether so expressed or
not.
Section 17.2. Official Acts by Successor Corporation. Any act or
--------------------------------------
proceeding by any provision of this Indenture authorized or required to be done
or performed by any board, committee or officer of the Company shall and may be
done and performed with like force and effect by the like board, committee or
officer of any corporation that shall at the time be the lawful sole successor
of the Company.
Section 17.3. Addresses for Notices, Etc. Any notice or demand which by
---------------------------
any provision of this Indenture is required or permitted to be given or served
by the Trustee or by the holders of Securities on the Company shall be deemed to
have been sufficiently given or made, for all purposes, if given or served by
being deposited postage prepaid by registered or certified mail in a post office
letter box addressed (until another address is filed by the Company with the
Trustee) to System Software Associates, Inc., 000 Xxxx Xxxxxxx Xxxxxx, 00xx
Xxxxx, Xxxxxxx, Xxxxxxxx 00000, Attn: Chief Financial Officer. Any notice,
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direction, request or demand hereunder to or upon the Trustee shall be deemed to
have been sufficiently given or made, for all purposes, if given or served by
being deposited postage prepaid by registered or certified mail in a post office
letter box addressed to the Corporate Trust Office, which office is, at the date
as of which this Indenture is dated, located at 000 Xxxx Xxxxxx Xxxxxx, 00xx
Xxxxx, Xxxxxxx, Xxxxxxxx 00000, Attn.: Indenture Trust Department.
The Trustee, by notice to the Company, may designate additional or
different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder shall be mailed to
him by first class mail, postage prepaid, at his address as it appears on the
Security register and shall be sufficiently given to him if so mailed within the
time prescribed.
Failure to mail a notice or communication to a Securityholder or any defect
in it shall not affect its sufficiency with respect to other Securityholders.
If a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
Section 17.4. Governing Law. This Indenture and each Security shall be
-------------
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be construed in accordance with the laws of the State of New
York.
Section 17.5. Evidence of Compliance with Conditions Precedent
------------------------------------------------
Certificates to Trustee. Upon any application or demand by the Company to the
-----------------------
Trustee to take any action under any of the provisions 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 opinion of such counsel, all such conditions precedent have been complied
with.
Each certificate or opinion provided for in this Indenture and delivered to
the Trustee with respect to compliance with a condition or covenant provided for
in this Indenture shall include (1) a statement that the person making such
certificate or opinion has read such covenant or condition; (2) a brief
statement as to the nature and scope of the examination or investigation upon
which the statement or opinion contained in such certificate or opinion is
based; (3) a statement that, in the opinion of such person, 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 or not, in the opinion of such
person, such condition or covenant has been complied with.
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Section 17.6. Legal Holidays. In any case where the date of maturity of
--------------
interest on or principal of the Securities or the date fixed for redemption or
repurchase of any Security will not be a Business Day, then payment of such
interest on or principal of the Securities need not be made on such date, but
may be made on the next succeeding Business Day with the same force and effect
as if made on the date of maturity or the date fixed for redemption or
repurchase, and no interest shall accrue for the period from and after such
date.
Section 17.7. Trust Indenture Act. This Indenture is hereby made subject
-------------------
to, and shall be governed by, the provisions of the Trust Indenture Act required
to be part of and to govern indentures qualified under the Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with another provision
hereof which is required to be included in an indenture qualified under the
Trust Indenture Act, such required provision shall control.
Section 17.8. No Security Interest Created. Nothing in this Indenture or
----------------------------
in the Securities, expressed or implied, shall be construed to constitute a
security interest under the Uniform Commercial Code or similar legislation, as
now or hereafter enacted and in effect, in any jurisdiction where property of
the Company or its subsidiaries is located.
Section 17.9. Benefits of Indenture. Nothing in this Indenture or in the
---------------------
Securities, expressed or implied, shall give to any Person, other than the
parties hereto, any paying agent, any authenticating agent, any Custodian, any
conversion agent, any Security registrar and their successors hereunder, the
holders of Securities and the holders of Senior Indebtedness, any benefit or any
legal or equitable right, remedy or claim under this Indenture.
Section 17.10. Table of Contents, Headings, Etc. The table of contents
---------------------------------
and the titles and headings of the articles and sections of this Indenture have
been inserted for convenience of reference only, are not to be considered a part
hereof, and shall in no way modify or restrict any of the terms or provisions
hereof.
Section 17.11. Authenticating Agent. The Trustee may appoint an
--------------------
authenticating agent which shall be authorized to act on its behalf and subject
to its direction in the authentication and delivery of Securities in connection
with the original issuance thereof and transfers and exchanges of Securities
hereunder, including under Sections 2.4, 2.5, 2.6, 2.7, 3.3, 15.2 and 16.2, as
------------ --- --- --- --- ----- ----
fully to all intents and purposes as though the authenticating agent had been
expressly authorized by this Indenture and those Sections to authenticate and
deliver Securities. For all purposes of this Indenture, the authentication and
delivery of Securities by the authenticating agent shall be deemed to be
authentication and delivery of such
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Securities "by the Trustee" and a certificate of authentication executed on
behalf of the Trustee by an authenticating agent shall be deemed to satisfy any
requirement hereunder or in the Securities for the Trustee's certificate of
authentication. Such authenticating agent shall at all times be a person
eligible to serve as trustee hereunder pursuant to Section 8.9.
-----------
Any corporation into which any authenticating agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any authenticating agent
shall be a party, or any corporation succeeding to the corporate trust business
of any authenticating agent, shall be the successor of the authenticating agent
hereunder, if such successor corporation is otherwise eligible under this
Section 17.11, without the execution or filing of any paper or any further act
-------------
on the part of the parties hereto or the authenticating agent or such successor
corporation.
Any authenticating agent may at any time resign by giving written notice of
resignation to the Trustee and to the Company. The Trustee may at any time
terminate the agency of any authenticating agent by giving written notice of
termination to such authenticating agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
any authenticating agent shall cease to be eligible under this Section, the
Trustee shall either promptly appoint a successor authenticating agent or itself
assume the duties and obligations of the former authenticating agent under this
Indenture, and upon such appointment of a successor authenticating agent, if
made, shall give written notice of such appointment of a successor
authenticating agent to the Company and shall mail notice of such appointment of
a successor authenticating agent to all holders of Securities as the names and
addresses of such holders appear on the Security register.
The Trustee agrees to pay to the authenticating agent from time to time
reasonable compensation for its services (to the extent pre-approved by the
Company in writing), and the Trustee shall be entitled to be reimbursed for such
pre-approved payments, subject to Section 8.6.
-----------
The provisions of Sections 8.2, 8.3, 8.4, 9.3 and this Section 17.11 shall
------------ --- --- --- -------------
be applicable to any authenticating agent.
Section 17.12. Execution in Counterparts. This Indenture may be executed
-------------------------
in any number of counterparts, each of which shall be an original, but such
counterparts shall together constitute but one and the same instrument.
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System Software Associates, Inc. hereby accepts the trusts in this
Indenture declared and provided, upon the terms and conditions hereinabove set
forth.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly signed, all as of the date first written above.
SYSTEM SOFTWARE ASSOCIATES, INC.
By: ____________________________
Name:
Title:
Attest:
___________________________
Title:
Xxxxxx Trust and Savings Bank, as Trustee
-----------------------------
By: ____________________________
Name:
Title:
Attest:
___________________________
Title:
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EXHIBIT A
---------
[FORM OF NOTE]
[For Global Security only:]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, NEW YORK, NEW YORK (THE "DEPOSITORY," WHICH TERM
INCLUDES ANY SUCCESSOR DEPOSITORY FOR THE CERTIFICATES) TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. (OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY), 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.
SYSTEM SOFTWARE ASSOCIATES, INC.
___% CONVERTIBLE SUBORDINATED NOTE DUE 2002
No. ___
CUSIP 871839 AA4
System Software Associates, Inc., a corporation duly organized and validly
existing under the laws of the State of Delaware (herein called the "Company"),
which term includes any successor corporation under the Indenture referred to on
the reverse hereof, for value received hereby promises to pay to
________________________________ or registered assigns, the principal sum of
[__________ ($__________)] [For Global Security only (as increased or decreased
from time to time in accordance with the procedures of DTC)] on September 15,
2002 at the office or agency of the Company maintained for that purpose in
Chicago, Illinois or, at the option of the holder of this Note, at the Corporate
Trust Office, in such coin or currency of the United States of America as at the
time of payment shall be legal tender for the payment of public and private
debts, and to pay interest, semi-annually on March 15 and September 15 of each
year, commencing March 15, 1998, on said principal sum at said office or agency,
in like coin or currency, at the rate per annum of ___%, from the date of this
Note, until payment of said principal sum has been made or duly provided for.
The interest payable on this Note pursuant to the Indenture on any March 15 or
September 15 will be paid to the person in whose name this Note (or one or more
Predecessor Notes) is registered at the close of business on the record date,
which shall be the March 1 or September 1 (whether or not a Business Day) next
preceding such March 15 or September 15, as provided in the Indenture provided
that any such interest not punctually paid or duly provided for shall be payable
as provided in the Indenture. Interest may, at the option of the Company, be
paid by check mailed to the registered address of such person; provided that
--------
with respect to any holder of Notes with an aggregate principal amount equal to
or in excess of $5,000,000, interest may be paid by wire transfer as more fully
specified in the Indenture.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, including, without limitation, provisions subordinating the
payment of principal of and premium, if any, and interest on the Notes to the
prior payment in full of all Senior Indebtedness, as defined in the Indenture,
and provisions giving the holder of this Note the right to convert this Note
into Common Stock of the Company on the terms and subject to the limitations
referred to on the reverse hereof and as more fully specified in the Indenture.
Such further provisions shall for all purposes have the same effect as though
fully set forth at this place.
91
This Note shall be deemed to be a contract made under the laws of the State
of New York, and for all purposes shall be construed in accordance with and
governed by the laws of said State.
This Note shall not be valid or become obligatory for any purpose until the
certificate of authentication hereon shall have been manually signed by the
Trustee or a duly authorized authenticating agent under the Indenture.
IN WITNESS WHEREOF, the Company has caused this Note to be duly executed
under its corporate seal.
Dated: SYSTEM SOFTWARE ASSOCIATES, INC.
By: ______________________________________________
[SEAL] Attest: __________________________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes described in the within-named Indenture.
Xxxxxx Trust and Savings Bank, as Trustee
By: _____________________________________________________________
Authorized Signatory
By: __________________________________________
As Authenticating Agent (if different from Trustee)
92
[FORM OF REVERSE OF NOTE]
SYSTEM SOFTWARE ASSOCIATES, INC.
___% CONVERTIBLE SUBORDINATED NOTE DUE 2002
This Note is one of a duly authorized issue of Notes of the Company,
designated as its ___% Convertible Subordinated Notes due 2002 (herein called
the "Notes"), limited to the aggregate principal amount of $100,000,000
($115,000,000 if the over-allotment option is exercised in full) issued or to be
issued under and pursuant to an indenture dated as of September __, 1997 (herein
called the "Indenture"), between the Company and Xxxxxx Trust and Savings Bank,
as trustee (herein called the "Trustee"), to which Indenture and all indentures
supplemental thereto reference is hereby made for a description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the holders of the Notes.
In case an Event of Default, as defined in the Indenture, shall have
occurred and be continuing, the principal of and accrued interest on all Notes
may be declared, and upon said declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of not less than a majority in aggregate
principal amount of the Notes at the time outstanding, evidenced as in the
Indenture provided, to execute supplemental indentures adding any provisions to
or changing in any manner or eliminating any of the provisions of the Indenture
or of any supplemental indenture or modifying in any manner the rights of the
holders of the Notes; provided, however, that no such supplemental indenture
-------- -------
shall (i) extend the fixed maturity of any Note, or reduce the rate or extend
the time of payment of interest thereon, or reduce the principal amount thereof
or premium, if any, thereon, or reduce any amount payable on redemption thereof,
or impair the right of any of the holders of the Notes to institute suit for the
payment thereof, or make the principal thereof or interest or premium, if any,
thereon payable in any coin or currency other than that provided in the Note, or
modify the provisions of the Indenture with respect to the subordination of the
Notes in a manner adverse to the holders of the Notes in any material respect,
or change the obligation of the Company to repurchase any Note upon the
occurrence of a Change in Control in a manner adverse to the holder of the
Notes, or impair the right to convert the Notes into Common Stock in any
material respect, without the consent of the holder of each Note so affected or
(ii) reduce the aforesaid percentage of Notes, the holders of which are required
to consent to any such supplemental indenture, without the consent of the
holders of all Notes then outstanding. It is also provided in the Indenture
that the holders of a majority in aggregate principal amount of the Notes at the
time outstanding may
93
on behalf of the holders of all of the Notes waive any past default or Event of
Default under the Indenture and its consequences, except a default in the
payment of interest or any premium on or the principal of any of the Notes, a
default in the payment of redemption price pursuant to Article III or
-----------
or repurchase price pursuant to Article XVI or a failure by the Company to
-----------
convert any Notes into Common Stock of the Company. Any such consent or waiver
by the holder of this Note (unless revoked as provided in the Indenture) shall
be conclusive and binding upon such holder and upon all future holders and
owners of this Note and any Notes which may be issued in exchange or substitute
hereof, irrespective of whether or not any notation thereof is made upon this
Note or such other Notes.
The indebtedness evidenced by the Notes is, to the extent and in the manner
provided in the Indenture, expressly subordinate and subject in right of payment
to the prior payment in full of all Senior Indebtedness of the Company, as
defined in the Indenture, whether outstanding at the date of the Indenture or
thereafter incurred, and this Note is issued subject to the provisions of the
Indenture with respect to such subordination. Each holder of this Note by
accepting the same, agrees to and shall be bound by such provisions and
authorizes the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate the subordination so provided and appoints the Trustee
his attorney-in-fact for such purpose.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Note at the place, at the respective times, at the rate and in the coin
or currency herein prescribed.
Interest on the Notes shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
The Notes are issuable in registered form without coupons in minimum
denominations of $1,000 and any integral multiple of $1,000. At the office or
agency of the Company referred to on the face hereof, and in the manner and
subject to the limitations provided in the Indenture, without payment of any
service charge but with payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration or
exchange of Notes, Notes may be exchanged for a like aggregate principal amount
of Notes of other authorized denominations.
The Notes will not be redeemable at the option of the Company prior to
September 20, 2000. At any time on or after September 20, 2000, and prior to
maturity the Notes may be redeemed at the option of the Company from time to
time, as a whole or in part, upon mailing a notice of such redemption not less
than 15 nor more than 60 days before the date fixed for redemption to the
holders of
-2-
Notes at their last registered addresses, all as provided in the Indenture, at
the following optional redemption prices (expressed as percentages of the
principal amount), together in each case with accrued interest to, but
excluding, the date fixed for redemption.
If redeemed during the 12-month period beginning September 20:
YEAR PERCENTAGE
------ -----------
2000................ _______%
2001................ _______
and 100% at September 15, 2002; provided that if the date fixed for redemption
--------
is on March 15 or September 15, then the semi-annual payment of interest
becoming due on such date shall be paid to the holder of record of the Note on
the next preceding March 1 or September 1, respectively.
The Notes are not subject to redemption through the operation of any
sinking fund.
If a Change in Control (as defined in the Indenture) occurs prior to
maturity, the holder of this Note shall have the right, in accordance with the
provisions of the Indenture, to require the Company to repurchase this Note or
any portion of the principal amount hereof that is an integral multiple of
$1,000 for cash at a Repurchase Price equal to 100% of the principal amount plus
accrued and unpaid interest to, but excluding, the Repurchase Date; provided
--------
that if such Repurchase Date is March 15 or September 15, then the semi-annual
payment of interest becoming due on such date shall be paid to the holder of
record of the Note on the next preceding March 1 or September 1, respectively.
Within 15 days after the occurrence of a Change in Control, the Company is
obligated to give all holders of record of Notes notice of the occurrence of
such Change in Control and of the repurchase right arising as a result
thereof.
Subject to the provisions of the Indenture, the holder hereof has the
right, at its option, at any time prior to the close of business on the maturity
date, subject to prior redemption or repurchase, or, as to all or any portion
hereof called for redemption, prior to the close of business on the Business Day
immediately preceding the date fixed for redemption (unless the Company shall
default in payment due upon redemption thereof), to convert the principal hereof
or any portion of such principal which is $1,000 or an integral multiple
thereof, into that number of shares of the Company's Common Stock, as said
shares shall be constituted at the date of conversion, obtained by dividing the
principal amount of this Note or portion thereof to be converted by the
Conversion Price of $_____ or such Conversion Price as adjusted from time to
time as provided in the Indenture, upon surrender of this Note, together with a
conversion notice as provided in the
-3-
Indenture, to the Company at the office or agency of the Company maintained for
that purpose in Chicago, Illinois, or at the option of such holder, the
Corporate Trust Office, and, unless the shares issuable on conversion are to be
issued in the same name as this Note, duly endorsed by, or accompanied by
instruments of transfer in form satisfactory to the Company duly executed by,
the holder or by his duly authorized attorney. No adjustment in respect of
interest or dividends will be made upon any conversion; provided, however, that
-------- -------
if this Note shall be surrendered for conversion during the period from the
close of business on any record date for the payment of interest to the close of
business on the Business Day preceding the interest payment date, this Note
(unless it or the portion being converted shall have been called for redemption
during the period from the close of business on any record date for the payment
of interest to the close of business on the Business Day preceding the interest
payment date) must be accompanied by an amount, in immediately available funds
or other funds acceptable to the Company, equal to the interest payable on such
interest payment date on the principal amount being converted, provided further
-------- -------
however, that in the event this Note or a portion thereof is called for
-------
redemption and the holder elects to convert such Note, the holder will be
entitled to receive interest on such Note for the period from the last interest
payment date through the date of conversion (provided however, that no such
-------- -------
payment need be made if there shall exist at the time of conversion a default in
the payment of interest on the Notes.) No fractional shares will be issued upon
any conversion, but an adjustment in cash will be made, as provided in the
Indenture, in respect of any fraction of a share which would otherwise be
issuable upon the surrender of any Note or Notes for conversion.
Any Notes called for redemption, unless surrendered for conversion on or
before the close of business on the date fixed for redemption, may be deemed to
be purchased from the holder of such Notes at an amount equal to the applicable
redemption price, together with accrued interest to the date fixed for
redemption, by one or more investment bankers or other purchasers who may agree
with the Company to purchase such Notes from the holders thereof and convert
them into Common Stock of the Company and to make payment for such Notes as
aforesaid to the Trustee in trust for such holders.
Upon due presentment for registration of transfer of this Note at the
office or agency of the Company in Chicago, Illinois, or at the option of the
holder of this Note, at the Corporate Trust Office, a new Note or Notes of
authorized denominations for an equal aggregate principal amount will be issued
to the transferee in exchange thereof, subject to the limitations provided in
the Indenture, without charge except for any tax or other governmental charge
imposed in connection therewith.
The Company, the Trustee, any authenticating agent, any paying agent, any
conversion agent and any Securities registrar may deem and treat the registered
holder hereof as the absolute owner of
-4-
this Note (whether or not this Note shall be overdue and notwithstanding any
notation of ownership or other writing hereon), for the purpose of receiving
payment hereof, or on account hereof, for the conversion hereof and for all
other purposes, and neither the Company nor the Trustee nor any other
authenticating agent nor any paying agent nor any other conversion agent nor any
Securities registrar shall be affected by any notice to the contrary. All
payments made to or upon the order of such registered holder shall, to the
extent of the sum or sums paid, satisfy and discharge liability for monies
payable on this Note.
No recourse for the payment of the principal of or any premium or interest
on this Note, or for any claim based hereon or otherwise in respect hereof, and
no recourse under or upon any obligation, covenant or agreement of the Company
in the Indenture or any indenture supplemental thereto or in any Note, or
because of the creation of any indebtedness represented thereby, shall be had
against any incorporator, stockholder, employee, agent, officer or director or
subsidiary, as such, past, present or future, of the Company or of any successor
corporation, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the issue
hereof, expressly waived and released.
Terms used in this Note and defined in the Indenture are used herein as
therein defined.
-5-
ABBREVIATIONS
The following abbreviations, when used in the inscription of the face of
this Note, shall be construed as though they were written out in full according
to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - _____ Custodian____
TEN ENT - as tenants by the (Cust) (Minor)
entireties
JT TEN - as joint tenants under Uniform Gifts to Minors Act
with right to
survivorship and
not as tenants in
common ______________________________________
(State)
Additional abbreviations may also be used
though not in the above list.
CONVERSION NOTICE
To: [_________________________]
The undersigned registered owner of this Note hereby irrevocably exercises
the option to convert this Note, or the portion hereof (which is $1,000 or an
integral multiple thereof) below designated, into shares of Common Stock of
System Software Associates, Inc. in accordance with the terms of the Indenture
referred to in this Note, and directs that the shares issuable and deliverable
upon such conversion, together with any check in payment for fractional shares
and any Notes 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 Note not converted are to be
issued in the name of a person other than the undersigned, the undersigned will
[check the appropriate box below and] pay all transfer taxes payable with
respect thereto. Any amount required to be paid to the undersigned on account
of interest accompanies this Note.
Dated: ___________________
__________________________________________________
__________________________________________________
Signature(s)
Signature(s) must be guaranteed by an eligible
Guarantor Institution (banks, stock brokers,
savings and loan associations and credit unions)
with membership in an approved signature guarantee
medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15 if shares of
Common Stock are to be issued, or Notes to be
delivered, other than to and in the name of the
registered holder.
__________________________________________________
Signature Guarantee
Fill in for registration
of shares of Common Stock
if to be issued, and
Notes if to be delivered,
other than to and in the
name of the registered
holder:
____________________________
(Name)
____________________________
(Xxxxxx Xxxxxxx)
____________________________
(City, State and Zip
Code)
Please print name and
address
Principal amount to be converted (if less than
all): $ __________
__________________________________________________
Social Security or Other Taxpayer
Identification Number
-2-
ASSIGNMENT
For value received _______________ hereby sell(s), assign(s) and transfer(s)
unto
________________________________________________________________________________
(Please insert name, social security or other Taxpayer Identification Number of
assignee)
the within Note, and hereby irrevocably constitutes and appoints
________________________________________________________________________________
attorney to transfer the said Note on the books of the Company, with full power
of substitution in the premises.
[_] The transferee is an Affiliate of the Company.
Dated: ______________
__________________________________________________
__________________________________________________
Signature(s)
Signature(s) must be guaranteed by an eligible
Guarantor Institution (banks, stock brokers,
savings and loan associations and credit unions)
with membership in an approved signature guarantee
medallion program pursuant to Securities and
Exchange Commission Rule 17Ad-15 if shares of
Common Stock are to be issued, or Notes to be
delivered, other than to and in the name of the
registered holder.
__________________________________________________
Signature Guarantee
-3-
OPTION TO ELECT REPURCHASE
UPON A CHANGE IN CONTROL
To: [_________________________]
The undersigned registered owner of this Note hereby irrevocably
acknowledges receipt of a notice from System Software Associates, Inc. (the
"Company") as to the occurrence of a Change in Control with respect to the
Company and requests and instructs the Company to repay the entire principal
amount of this Note, or the portion thereof (which is $1,000 or an integral
multiple thereof) below designated, in accordance with the terms of the
Indenture referred to in this Note at the repurchase price, together with
accrued interest to, but excluding, such date, to the registered holder hereof.
Dated: _________________
__________________________________________________
__________________________________________________
Signature(s)
NOTICE: The above signatures of the holder(s)
hereof must correspond with the name as written
upon the face of the Note in every particular
without alteration, enlargement or any change
whatever.
Principal amount to be repurchased (if less than
all):
$ ___________
__________________________________________________
Social Security or Other Taxpayer
Identification Number
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