FIRST SUPPLEMENTAL INDENTURE
EXHIBIT
4.1
THIS
FIRST SUPPLEMENTAL INDENTURE (this “Supplemental
Indenture”),
dated
as of April 9, 2007, is entered into between EMCORE Corporation, a New Jersey
corporation (the “Company”),
and
Deutsche Bank Trust Company Americas, as trustee (the “Trustee”).
RECITALS
WHEREAS,
the Company has heretofore executed and delivered to the Trustee an indenture,
dated as of February 24, 2004 (as amended or supplemented from time to time,
the
“Indenture”),
providing for the issuance of an aggregate principal amount of up to $80.276
million of 5% Convertible Senior Subordinated Notes due 2011 (the “Notes”);
WHEREAS,
as of the date of this Supplemental Indenture, $80,276,000 aggregate principal
amount of the Notes is outstanding;
WHEREAS,
the Company and the Holders of a majority in principal amount of the outstanding
Notes desire to amend and supplement the Indenture upon the terms set forth
in
this Supplemental Indenture;
WHEREAS,
pursuant to Section 11.02 of the Indenture, the Trustee is authorized to execute
and deliver this Supplemental Indenture with the consent of the Holders of
at
least a majority in principal amount of the outstanding Notes;
WHEREAS,
the Board of Directors of the Company has duly authorized the execution and
delivery by the Company of this Supplemental Indenture;
WHEREAS,
the Holders or beneficial owners of more than fifty percent (50%) in aggregate
principal amount of the outstanding Notes have specifically consented in writing
to and approved the execution hereof; and
WHEREAS,
all acts and things necessary to make this Supplemental Indenture a valid and
binding agreement for the purposes and objects herein expressed have been duly
done and performed, and the execution and delivery of this Supplemental
Indenture has been, in all respects, duly authorized.
NOW
THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the
Company and the Trustee mutually covenant and agree for the equal and ratable
benefit of the Holders of the Notes as follows:
1. Definitions.
Capitalized terms used herein without definition shall have the meanings
assigned to them in the Indenture.
2. References
to 5% Convertible Senior Subordinated Notes Due 2011. All
references in the Indenture to “5% Convertible Senior Subordinated Notes Due
2011” shall be amended to instead refer to “5.50% Convertible Senior
Subordinated Notes Due 2011.”
3. Amendment
to Conversion Price.
Pursuant to Section 4.14 of the Indenture, the Indenture and the Notes,
including but not limited to Section 9 of the Notes, are hereby amended in
all
respects necessary so that the Holder of a Note, from and after the expiration
of the notice period set forth in Section 4.14 of the Indenture, on the terms
and subject to the conditions set forth in the Indenture, shall have the right,
at such Holder’s option, to convert each $1,000 principal amount of the Notes
into fully paid and nonassessable shares of Common Stock at a Conversion Price
equal to $7.01, as such Conversion Price may be further adjusted pursuant to
the
terms of the Indenture. The Company will deliver the notice required by Section
4.14 of the Indenture promptly but in no event later than three Business Day
from April 9, 2007.
4. Amendment
to Section 1.01.
Section
1.01 of the Indenture is hereby amended by adding the following definitions
in
the applicable alphabetical locations:
““Asserted
Reports Default”
means
any and all Defaults or Events of Defaults relating to any failure of the
Company to observe or perform any covenant or agreement contained in the Notes
or the Indenture as a result of the Company’s failure to file with the SEC, or
with the Trustee, its annual report on Form 10-K for the fiscal year ended
September 30, 2006, its quarterly report on Form 10-Q for the quarter ended
December 31, 2006 and/or any other reports that the Company fails to file in
a
timely manner for reasons in whole or in part directly or indirectly
attributable to or arising out of the Company’s review of its historical stock
option grants as initially reported in a Current Report on Form 8-K filed with
the SEC on November 6, 2006.”
“Conversion
Rate”
on
any
date of determination means $1,000 divided by the Conversion Price as of such
date.
“Non-Stock
Change of Control”
means
a
Change of Control pursuant to which 15% or more of the consideration for Common
Stock (other than cash payments for fractional shares, if applicable, and cash
payments made in respect of dissenters’ appraisal rights) in such transaction
consists of cash or securities (or other property) that are not shares of common
stock, depositary receipts or other equity interests traded or scheduled to
be
traded immediately following such transaction on a U.S. national securities
exchange. Solely for purposes of this definition of “Non-Stock Change of
Control,” notwithstanding the last paragraph of Section 6.08(a) hereof, the
determination of whether a Change of Control has occurred shall exclude any
provisions contained herein that provide as the basis for such determination
the
relationship of the Closing Sale Price of the Common Stock over any period
to
the Conversion Price.”
5. Amendment
to Section 1.02.
Section
1.02 of the Indenture is hereby amended by adding the following definitions
in
the applicable alphabetical locations:
““Additional
Shares” -
4.01(c)
“Effective
Date” -4.01(c)
“Reporting
Obligations” - 8.01(d)
“Stock
Price” -
4.01(c)”
6. Amendment
to Section 2.11.
Section
2.11 of the Indenture is hereby amended in its entirety to read as
follows:
“The
Company may at any time deliver Notes to the Trustee for cancellation. The
Registrar, Paying Agent and Conversion Agent shall forward to the Trustee any
Notes surrendered to them for registration of transfer, exchange, redemption,
payment or conversion. The Trustee and no one else shall cancel Notes
surrendered for registration of transfer, exchange, redemption, payment,
conversion, replacement or cancellation and shall destroy cancelled Notes
(subject to the record retention requirement of the Exchange Act), in accordance
with their normal procedures. The foregoing notwithstanding, the Company may
hold, exchange or resell Notes which are redeemed, purchased or otherwise
acquired by the Company or any of its Subsidiaries prior to the maturity date
or
the Company may deliver any such Notes to the Trustee for
cancellation.”
7. Amendment
to Section 2.12(d).
Section
2.12 of the Indenture is hereby amended in its entirety to read as
follows:
“(d) Transfers
to the Company.
Nothing
in this Indenture or in the Notes shall prohibit the sale or other transfer
of
any Notes (including beneficial interests in Global Notes) to the Company or
any
of its Subsidiaries, which Notes may thereupon be held, exchanged or resold
by
the Company or may be cancelled in accordance with the provisions of Section
2.11.”
8. Amendment
to Section 3.07(a).
Section
3.07(a) of the Indenture is hereby amended in its entirety to read as follows:
“(a) The
Notes
may be redeemed at the election of the Company, as a whole or in part from
time
to time, at any time (a “Provisional
Redemption”),
upon
at least 20 and not more than 60 days’ notice by mail to the Holders of the
Notes (a “Provisional
Redemption Notice”)
at a
redemption price equal to $1,000 per $1,000 principal amount of the Notes
redeemed plus accrued and unpaid interest, if any (such amount, together with
the Early Call Premium described below, the “Provisional
Redemption Price”),
to
but excluding the date of redemption (the “Provisional
Redemption Date”)
if the
Closing Sale Price of the Common Stock has exceeded 172.5% of the Conversion
Price for at least 20 Trading Days within a period of any 30 consecutive Trading
Days ending on the Trading Day prior to the date of mailing of the notice of
Provisional Redemption (the “Provisional
Redemption Notice Date”).”
9. Amendment
to Section 4.01.
Section
4.01 of the Indenture is hereby amended in its entirety to read as
follows:
“Section
4.01. Conversion Privilege; Conversion Price
(a)
Right
to Convert.
A
Holder of a Note may convert it into fully paid and nonassessable shares of
Common Stock at any time prior to maturity at the Conversion Price then in
effect, except that, with respect to any Note called for redemption or submitted
or presented for purchase pursuant to Section 6.08, such conversion right shall
terminate at the close of business on the Business Day immediately preceding
the
Redemption Date or Change of Control Payment Date, as the case may be (unless
the Company shall default in making the redemption payment or Change of Control
Payment when it becomes due, in which case the conversion right shall terminate
on the date such default is cured and such Note is redeemed or purchased, as
the
case may be). The number of shares of Common Stock issuable upon conversion
of a
Note is determined by dividing the principal amount of such Note by the
conversion price in effect on the Conversion Date (the “Conversion
Price”).
A
Holder
may convert a portion of a Note equal to any integral multiple of $1,000.
Provisions of this Indenture that apply to conversion of all of a Note also
apply to conversion of a portion of it.
A
Note in
respect of which a Holder has delivered a Change of Control Payment Notice
pursuant to Section 6.08 exercising the option of such Holder to require the
Company to purchase such Note may be converted only if such Change of Control
Payment Notice is withdrawn by a written notice of withdrawal delivered to
a
Paying Agent prior to the close of business on the Business Day immediately
preceding the Change of Control Payment Date in accordance with Section
6.08.
A
Holder
of Notes is not entitled to any rights of a holder of Common Stock until such
Holder has converted its Notes to Common Stock, and only to the extent such
Notes are deemed to have been converted into Common Stock pursuant to this
Article 4.
(b) Conversion
Price.
The
Conversion Price is stated in Section 9 of the Notes and is subject to
adjustment as provided in this Article 4.
(c)
If
and
only to the extent a Holder elects to convert Notes at any time following the
date on which a Non-Stock Change of Control becomes effective (the “Effective
Date”)
but
before 5:00 p.m., New York City time, on the Business Day immediately preceding
the related Change of Control Payment Date, the Company shall increase the
Conversion Rate (and decrease the Conversion Price correspondingly) applicable
to such converted Notes by a number of additional shares of Common Stock (the
“Additional
Shares”)
as set
forth below provided that the Effective Date is prior to May 15, 2011. The
number of Additional Shares shall be determined by reference to the table below,
based on the Effective Date and the price (the “Stock
Price”)
paid
per share for the Common Stock in the Non-Stock Change of Control. If holders
of
Common Stock receive only cash in the Non-Stock Change of Control, the Stock
Price shall be the cash amount paid per share. Otherwise, the Stock Price shall
be the volume-weighted average of the Closing Sale Prices of the Common Stock
on
the five Trading Days prior to but not including the Effective Date of such
Non-Stock Change of Control.
The
numbers of Additional Shares set forth in the table below shall be adjusted
as
of any date on which the Conversion Rate is adjusted in the same manner in
which
the Conversion Rate is adjusted. The Stock Prices set forth in the table below
shall be adjusted, as of any date on which the Conversion Rate is adjusted,
to
equal the Stock Price applicable immediately prior to such adjustment multiplied
by a fraction, of which
(1)
the
numerator shall be the Conversion Rate immediately prior to the adjustment
and
(2)
the
denominator shall be the Conversion Rate as so adjusted.
The
following table sets forth the Stock Price and number of Additional Shares
by
which the Conversion Rate shall be increased:
|
Stock
Price
|
||||||||||||||||
|
Effective
Date
|
$4.93
|
$5.42
|
$5.92
|
$6.41
|
$6.90
|
$7.01
|
$7.40
|
$7.89
|
$8.38
|
$8.87
|
$9.37
|
$9.86
|
$12.33
|
$14.79
|
$17.26
|
$19.72
|
|
3/22/07
|
60.196
|
58.201
|
50.417
|
43.726
|
38.636
|
37.589
|
34.148
|
29.865
|
26.878
|
23.682
|
21.962
|
19.587
|
11.802
|
5.618
|
2.696
|
1.583
|
|
3/22/08
|
60.196
|
55.714
|
47.402
|
40.771
|
35.408
|
34.365
|
31.003
|
27.338
|
24.254
|
21.622
|
19.357
|
17.391
|
10.348
|
5.720
|
2.052
|
0.578
|
|
3/22/09
|
60.196
|
51.770
|
42.920
|
35.998
|
30.515
|
29.465
|
26.120
|
22.552
|
19.629
|
17.192
|
15.158
|
13.409
|
7.549
|
3.928
|
1.136
|
0.518
|
|
3/22/10
|
60.196
|
46.588
|
36.668
|
29.129
|
23.378
|
22.307
|
18.975
|
15.587
|
12.968
|
10.931
|
9.335
|
8.075
|
4.543
|
2.697
|
1.177
|
0.578
|
|
3/22/11
|
60.196
|
42.168
|
27.853
|
17.071
|
9.553
|
8.290
|
4.779
|
2.039
|
0.625
|
0.000
|
0.000
|
0.000
|
0.000
|
0.193
|
0.370
|
0.502
|
If
the
Stock Price and Effective Date are not set forth on the table above and the
Stock Price is:
(1)
between two Stock Prices on the table or the Effective Date is between two
days
on the table, the number of Additional Shares shall be determined by
straight-line interpolation between the number of Additional Shares of Common
Stock set forth for the higher and lower Stock Price and the two Effective
Dates, as applicable, based on a 360-day year;
(2)
in
excess of $19.72 per share (subject to adjustment in the same manner as and
as
of any date on which the Stock Prices are adjusted in the table above), no
Additional Shares of Common Stock shall be issued upon conversion;
or
(3)
less
than $4.93 per share (subject to adjustment in the same manner as and as of
any
date on which the Stock Prices are adjusted in the table above), no Additional
Shares of Common Stock shall be issued upon conversion.
Notwithstanding
the foregoing, in no event will the Conversion Rate as adjusted pursuant to
this
Section 4.01(c) exceed 202.849 per $1,000 principal amount of the Notes, subject
to adjustments in the same manner as and as of any date on which the numbers
of
Additional Shares set forth in the above table are adjusted as set forth in
the
second paragraph of this Section 4.01(c). Any notice required to be delivered
by
Section 4.11 hereof with respect to an adjustment in the Conversion Price shall
also include information with respect to the corresponding changes in the
Conversion Rate and Stock Prices set forth in the table above and elsewhere
in
this Section 4.01(c).”
10. Amendment
to Section 4.02.
Section
4.02 of the Indenture is hereby amended by deleting the phrase “Section 8” in
the first sentence thereof and replacing it with the phrase “Section
9.”
11. Amendment
to Section 4.06(e).
Section
4.06(e) of the Indenture is hereby amended in its entirety to read as
follows:
“(e) In
case
the Company shall, by dividend or otherwise, at any time distribute (a
“Triggering
Distribution”)
to all
or substantially all holders of its Common Stock cash (including any quarterly
cash dividend, but excluding (x) any dividend or distribution in connection
with
the liquidation, dissolution or winding up of the Company, whether voluntary
or
involuntary and (y) any dividend or distribution in connection with the
reclassification, consolidation, merger, binding share exchange or sale to
which
Section 4.12 hereof applies), then the Conversion Price shall be reduced so
that
the same shall equal the price determined by multiplying such Conversion Price
in effect immediately prior to the Business Day preceding the day on which
such
Triggering Distribution is declared (the “Determination
Date”)
by a
fraction,
(1) the
numerator of which shall be the current market price per share of the Common
Stock (as determined in accordance with subsection (g) of this Section 4.06)
on
the Determination Date, less the amount of the cash distribution applicable
to
one share of Common Stock; and
(2) the
denominator of which shall be such current market price per share of the Common
Stock (as determined in accordance with subsection (g) of this Section 4.06)
on
the Determination Date,
such
reduction to become effective immediately prior to the opening of business
on
the day following the date on which the Triggering Distribution is
paid.”
12. Amendment
to Section 4.11.
Section
4.11 of the Indenture is hereby amended by adding the following sentence
immediately before the last sentence of Section 4.11:
“Any
notice required to be delivered as a result of a transaction referred to in
clause (1) of this Section 4.11 shall also include information with respect
to
the corresponding changes in the Conversion Rate and the Stock Prices set forth
in the table and elsewhere in Section 4.01(c) hereof.”
13. Amendment
to Section 8.01.
Section
8.01 of the Indenture is hereby amended by:
(i) by
deleting clause (d) thereof and replacing it in its entirety as
follows:
“(d) the
Company fails to observe or perform any other covenant, representation, warranty
or other agreement in this Indenture or the Notes for 60 days after notice
to
the Company by the Trustee or the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding voting as a single class (or 270 days
after
such notice with respect to any failure to comply with any covenant,
representation, warranty or other agreement under Section 6.03, including,
but
not limited to, the requirements of Section 314(a) of the TIA, but other than
the failure as to which specific provision is made in the next succeeding
paragraph of this Section 8.01(d) (collectively, the “Reporting Obligations”);”
and
(ii) adding
the following paragraph at the end thereof:
“Any
notice of default delivered to the Company or the Trustee pursuant to Section
8.01(d) of this Indenture that relates in any way to an Asserted Reports Default
shall have no further force or effect through February 29, 2008 with respect
to
the exercise of any remedy under this Indenture by the Trustee or any Holder
or
Holders with respect to such purported Default or Event of Default and shall
be
deemed to be withdrawn, rescinded and of no further force or effect through
February 29, 2008. If the Company has not cured the Asserted Reports Default
before January 1, 2008, then the Company shall be obligated to make an
additional payment at the rate of 0.25% per annum of the principal amount of
the
Notes then outstanding, payable on the interest payment dates, commencing on
January 1, 2008 and ending on the date on which the Company cures the Asserted
Reports Default. If the Company has not cured the Asserted Reports Default
before March 1, 2008, then the same shall constitute an Event of Default and
the
Trustee or the Holders of at least 25% in principal amount of the then
outstanding Notes may declare all the Notes to be due and payable immediately
in
accordance with Section 8.02 hereof. ”
14. Amendment
to Article 8 of the Indenture.
The
following is hereby added as Section 8.12 of the Indenture:
“Section
8.12. Undertaking for Additional Payment for Failure To File Reports.
Subject
to the last paragraph of Section 8.01 and notwithstanding any provision to
the
contrary herein, if the Company receives notice from the Trustee or the Holders
of at least 25% in aggregate principal amount of the Notes then outstanding
voting as a single class of the failure by the Company to comply with the
Reporting Obligations, then the sole remedy for such failure to comply shall
consist exclusively of the right to receive an additional payment in an amount
equal 0.25% per annum of the principal amount of the Notes then outstanding,
payable on the interest payment dates, commencing on the later of the
60th
day
after such failure to comply with the Reporting Obligations or the date on
which
the Company receives such notice and ending upon the earlier of the occurrence
of an Event of Default with respect to the Reporting Obligations as set forth
in
Section 8.01(d) or the compliance with, or waiver of, the Reporting
Obligations.
Upon the
occurrence of an Event of Default with respect to the Reporting Obligations
as
set forth in Section 8.01(d), the Notes will be subject to acceleration in
accordance with Section 8.02 hereof. The foregoing shall not affect the rights
of Holders in the event of the occurrence of any other Event of
Default.”
15. Amendment
to Exhibit A and the Notes.
Paragraph 1 of Exhibit A to the Indenture and each of the outstanding Notes
is
hereby amended by replacing the phrase “5%” that appears in the first sentence
thereof with the phrase “5.50%.”
16. Conditions
to Effectiveness.
This
Supplemental Indenture shall be effective upon execution and delivery of this
Supplemental Indenture by the Company and the Trustee.
17. Miscellaneous.
17.1 Effect;
Ratification.
(a) Upon
and
after the effectiveness of this Supplemental Indenture, each reference in the
Indenture to “this Indenture,” “hereunder,” “hereof” or words of like import
referring to the Indenture, and each reference in the Notes issued prior to
the
date hereof to “the Indenture,” “thereunder,” “thereof” or words of like import
referring to the Indenture, shall mean and be a reference to the Indenture
as
amended hereby.
(b) Upon
and
after the effectiveness of this Supplemental Indenture, each reference in the
Indenture to the Notes, and each reference in the Notes issued prior to the
date
hereof referring to the Notes, shall mean and be a reference to the Notes as
amended hereby.
(c) Except
as
specifically amended above, the Indenture and the Notes issued prior to the
date
hereof are and shall continue to be in full force and effect and are hereby
in
all respects ratified and confirmed.
(d) The
execution, delivery and effectiveness of this Supplemental Indenture shall
not,
except as expressly provided herein, (i) operate as a waiver of any right,
power
or remedy of the Company, any Holder or the Trustee under the Indenture or
any
of the Notes, or (ii) constitute a waiver or amendment of any provision of
the
Indenture or any of the Notes.
17.2 Costs
and Expenses.
The
Company agrees to reimburse the Trustee for all reasonable and documented
out-of-pocket fees, costs and expenses, including the fees, costs and expenses
of counsel or other advisors for advice, assistance, or other representation
in
connection with this Supplemental Indenture (it being understood and agreed
that
the documentation of counsel’s fees and expenses may omit information that such
counsel reasonably deems privileged).
17.3 Governing
Law.
THE
INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE
THIS
SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.
17.4 Counterpart
Originals.
The
parties may sign any number of copies of this Supplemental Indenture. Each
signed copy shall be an original, but all of them together represent the same
agreement.
17.5 Headings.
The
Headings of the Sections of this Supplemental Indenture have been inserted
for
convenience of reference only, are not to be considered a part of this
Supplemental Indenture and shall in no way modify or restrict any of the terms
or provisions hereof.
17.6 Severability.
In case
any provision of this Supplemental Indenture shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
17.7 The
Trustee.
The
Trustee shall not be responsible in any manner whatsoever for or in respect
of
the validity or sufficiency of this Supplemental Indenture or for or in respect
of the recitals contained herein, all of which recitals are made solely by
the
Company.
IN
WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture
to
be duly executed as of the date first above written.
EMCORE
CORPORATION
By:
/s/
Xxxxxx Xxxxxxxx Xx.
Name:
Xxxxxx Xxxxxxxx Xx.
Title:
CEO
DEUTSCHE
BANK TRUST COMPANY AMERICAS,
as
trustee
By:
/s/
Xxxxxxx Xxxx
Name:
Xxxxxxx Xxxx
Title:
Vice President
By:
/s/
Xxxxx Xxxxxxx
Name:
Xxxxx Xxxxxxx
Title:
Vice President
