Exhibit 10.13
This Second Supplemental Trust Indenture, dated as of August 4, 1999
(the "Supplemental Indenture"), between Quantum Corporation, a corporation duly
organized and existing under the laws of the State of Delaware (the "Company"),
and LaSalle National Bank, a national banking association organized and existing
under the laws of the United States of America, as Trustee (the "Trustee"),
supplementing that certain Indenture, dated as of August 1, 1997, between the
Company and the Trustee as supplemented by the Supplemental Indenture dated as
of August 1, 1997 (the "First Supplemental Indenture, and such Indenture, as
supplemented by the First Supplemental Indenture and this Supplemental
Indenture, being referred to herein as the "Indenture").
Recitals
A. The Company has duly authorized the execution and delivery of the
Indenture heretofore executed and delivered to provide for the issuance from
time to time of its unsecured debentures, notes, or other evidences of
indebtedness to be issued in one or more series as provided for in the Indenture
heretofore executed and delivered.
B. The Company issued Securities denominated "7% Convertible
Subordinated Notes due 2004" (the "Notes") pursuant to the terms of the First
Supplemental Indenture.
C. Effective August 4, 1999, the Company entered into a restructuring
(the "Restructuring") of common stock, whereby the common stock of the Company
was exchanged for two classes of tracking stock called DLT & Storage Systems
group stock and Hard Disk Drive group stock. In connection with the
Restructuring, each share of common stock was changed into one share of DLT &
Storage Systems group stock and 0.5 shares of Hard Disk Drive group stock.
D. Pursuant to Section 14.09 of the Indenture, the Company and the
Trustee are required to execute this Supplemental Indenture to make the Notes
convertible into both classes of tracking stock as further set forth herein.
ARTICLE ONE
AMENDMENTS
Section 101 Amendment to Section 101 of Indenture. Section 101 of the
Indenture is hereby amended by adding the following definitions in appropriate
alphabetical order:
"DSS Common Stock" shall mean the Company's Common Stock called DLT
& Storage Systems group stock or shares of any class or classes
resulting from any reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable
in the event of any voluntary or involuntary liquidation, dissolution or
winding-up of the Company and which are not subject to redemption by the
Company; provided that if at any time there shall be more than one such
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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.
"HDD Common Stock" shall mean the Company's Common Stock called
Hard Disk Drive group stock or shares of any class or classes resulting
from any reclassification or reclassifications thereof and which have no
preference in respect of dividends or of amounts payable in the event of
any voluntary or involuntary liquidation, dissolution or winding-up of the
Company and which are not subject to redemption by the Company; provided
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that if at any time there shall be more than one such resulting class, the
shares of each such class then so issuable shall be substantially in the
proportion which the total number of shares of such class resulting from
all such reclassifications bears to the total number of shares of all such
classes resulting from all such reclassifications.
Section 102 Amendments to Article Fourteen of Indenture.
(a) Each of Sections 1404, 1405, 1406 and 1407 of the Indenture is
hereby amended by replacing the phrase "Common Stock" with the phrase "DSS
Common Stock or HDD Common Stock" in each place where such phrase appears.
(b) Section 1409 of the Indenture is hereby amended by replacing it in
its entirety with the following:
If any of the following events occur, namely (i) any reclassification or
change of the outstanding shares of DSS Common Stock or HDD Common Stock
(other than a subdivision or combination of DSS Common Stock or HDD Common
Stock, as the case may be, to which Section 1404 applies), (ii) any
consolidation, merger or combination of the Company with another
corporation as a result of which holders of DSS Common Stock or HDD Common
Stock shall be entitled to receive stock, securities or other property or
assets (including cash) with respect to or in exchange for such DSS Common
Stock or HDD Common Stock, as the case may be, 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
DSS Common Stock or HDD Common Stock shall be entitled to receive stock,
securities or other property or assets (including cash) with respect to or
in exchange for such DSS Common Stock or HDD Common Stock, as the case may
be, 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 the Holder of each
Security of a series then Outstanding that is convertible into DSS Common
Stock or HDD Common Stock of the Company shall have the right thereafter to
convert such Security 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 DSS Common Stock or HDD
Common Stock issuable upon conversion of such Securities (assuming, for
such purposes, a sufficient number of authorized shares of DSS Common Stock
or HDD Common Stock, as the case may be, available to convert all such
Securities) immediately prior to such reclassification, change,
consolidation, merger, combination, sale or conveyance assuming such holder
of DSS Common Stock or HDD Common Stock, as the case may be, did not
exercise his rights of election, if any, as to the kind or amount of
securities, cash or other property receivable upon such consolidation,
merger, statutory exchange, sale or conveyance (provided that, if
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the kind or amount of securities, cash or other property receivable upon
such consolidation, merger, statutory exchange, sale or conveyance is not
the same for each share of DSS Common Stock or HDD Common Stock, as the
case may be, in respect of which such rights of election shall not have
been exercised ("nonelecting share")), then for the purposes of this
Section 1409 the kind and amount of securities, cash or other property
receivable upon such consolidation, merger, statutory exchange, sale or
conveyance for each non-electing share shall be deemed to be the kind and
amount so receivable per share by a plurality of the non-electing shares.
Such supplemental indenture shall provide for adjustments which,
for events subsequent to the effective date of such supplemental indenture,
shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Article or in accordance with the terms of the
supplemental indenture or Board Resolutions setting forth the terms of such
adjustments. The above provisions of this Section 1409 shall similarly
apply to successive consolidations, mergers, conveyances, sales, transfers
or leases. Notice of the execution of such a supplemental indenture shall
be given by the Company to the Holder of each Security of a series that is
convertible into DSS Common Stock or HDD Common Stock of the Company as
provided in Section 106 promptly upon such execution.
Neither the Trustee nor any conversion agent, if any, shall be
under any responsibility to determine the correctness of any provisions
contained in any such supplemental indenture relating either to the kind or
amount of shares of stock or other securities or property or cash
receivable by Holders of Securities of a series convertible into DSS Common
Stock and HDD Common Stock of the Company upon the conversion of their
Securities after any such consolidation, merger, conveyance, transfer, sale
or lease or to any such adjustment, but may accept as conclusive evidence
of the correctness of any such provisions, and shall be protected in
relying upon, an Opinion of Counsel with respect thereto, which the Company
shall cause to be furnished to the Trustee upon request.
Section 103 Amendments to Section 201 of First Supplemental Indenture.
Section 201 of the Supplemental Indenture is hereby amended by adding the
following definitions in the appropriate alphabetized order:
"DSS Conversion Price" has the meaning specified in Section 501 of
this Supplemental Indenture.
"HDD Conversion Price" shall have the meaning specified in Section
501 of this Supplemental Indenture.
Section 104 Amendment to Section 401 of First Supplemental Indenture.
Section 401 of the First Supplemental Indenture is hereby amended by
replacing the proviso beginning in the fourth line of the first paragraph of
Section 401 with the following:
provided, however, that the Notes will not be redeemable following August
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1, 1999, and before August 1, 2001, unless the fair market value of the DSS
Common Stock
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and HDD Common Stock issuable upon the conversion of $1,000 of principal
amount of Notes, based on the Closing Prices for at least 20 Trading Days
within a period of 30 consecutive Trading Days ending within five Trading
Days prior to the notice of redemption, exceeds $1,250 (using the same
Trading Days for determining the Closing Prices of both the DSS Common
Stock and the HDD Common Stock).
Section 105 Amendment to Article Five of First Supplemental Indenture.
Article Five of the First Supplemental Indenture is hereby replaced in its
entirety with the following:
Section 501 Conversion Right
Subject to and upon compliance with the provisions of this Article,
each Holder shall have the right to convert any $1000 of principal of Notes
held by such holder into the number of DSS Common Stock obtained by
dividing $666.67 by the DSS Conversion Price and into the number of HDD
Common Stock obtained by dividing $333.33 by the HDD Conversion Price. Such
conversion right shall commence on August 1, 1997 and expire at the close
of business on August 1, 2004, subject, in the case of the conversion of
any Global Security, to any applicable book-entry procedures of the
Depositary therefor. In case a Note is called for redemption at the
election of the Company, such conversion right in respect of the Note shall
expire at the close of business on the Business Day next preceding the
Redemption Date. A Note in respect of which a Holder is exercising its
option to require redemption upon a Fundamental Change may be converted
only if such Holder withdraws its election to exercise its option in
accordance with Article Six of this Supplemental Indenture.
The initial DSS Conversion Price shall be $30.883 and the initial
HDD Conversion Price shall be $30.883, and each shall be adjusted in
certain instances as provided in this Article Five.
Section 502 Adjustment of DSS Conversion Price.
The DSS Conversion Price shall be subject to adjustment from time
to time as follows:
(a) In case the Company shall hereafter pay a dividend or
make a distribution to all holders of the outstanding DSS Common Stock in
shares of DSS Common Stock, the DSS 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 DSS Conversion Price by a
fraction of which the numerator shall be the number of shares of DSS 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
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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 DSS Common Stock held in
the treasury of the Company. The Company will not pay any dividend or make
any distribution on shares of DSS Common Stock held in the treasury of the
Company. If any dividend or distribution of the type described in this
Section 502(a) is declared but not so paid or made, the DSS Conversion
Price shall again be adjusted to the DSS 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 DSS 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 DSS 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 DSS
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the DSS Conversion Price in effect immediately
prior to the date fixed for determination of stockholders entitled to
receive such rights or warrants by a fraction of which the numerator shall
be the number of shares of DSS 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 DSS 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 DSS 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 DSS Common Stock are not
delivered after the expiration of such rights or warrants, the DSS
Conversion Price shall be readjusted to the DSS 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 DSS Common Stock actually delivered. In the event that such
rights or warrants are not so issued, the DSS Conversion Price shall again
be adjusted to be the DSS 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 DSS Common Stock at less than such Current Market Price, and in
determining the aggregate offering price of such shares of DSS 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.
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(c) In case outstanding shares of DSS Common Stock shall be subdivided
into a greater number of shares of DSS Common Stock, the DSS 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 DSS Common Stock shall be combined into a smaller
number of shares of DSS Common Stock, the DSS 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 DSS Common Stock shares of any class of capital stock of the
Company (other than any dividends or distributions to which Section 502(a)
applies) or evidences of its indebtedness or assets (including securities, but
excluding any rights or warrants referred to in Section 502(b), and excluding
any dividend or distribution (x) paid exclusively in cash or (y) referred to in
Section 502(a) (any of the foregoing hereinafter in this Section 502(d) called
the "DSS Distribution Securities")), then, in each such case (unless the Company
elects to reserve such DSS Distribution Securities for distribution to the
Holders upon the conversion of the Notes so that any such Holder converting
Notes will receive upon such conversion, in addition to the shares of DSS Common
Stock to which such Holder is entitled, the amount and kind of such DSS
Distribution Securities which such Holder would have received if such Holder had
converted its Notes immediately prior to the Distribution Record Date (as
defined in Section 504(c) for such distribution of the DSS Distribution
Securities)), the DSS Conversion Price shall be reduced so that the same shall
be equal to the price determined by multiplying the DSS Conversion Price in
effect on the Distribution Record Date with respect to such distribution by a
fraction of which the numerator shall be the Current Market Price per share of
the DSS Common Stock on such Distribution 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
Distribution Record Date of the portion of the Securities so distributed
applicable to one share of DSS Common Stock and the denominator shall be the
Current Market Price per share of the DSS Common Stock, such reduction to become
effective immediately prior to the opening of business on the day following such
Distribution Record Date; provided, however, that in the event the then fair
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market value (as so determined) of the portion of the DSS Distribution
Securities so distributed applicable to one share of DSS Common Stock is equal
to or greater than the Current Market Price of the DSS Common Stock on the
Distribution Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Holder shall have the right to receive upon
conversion the amount of DSS Distribution Securities such Holder would have
received had such Holder converted each Note on the Distribution Record Date.
In the event that such dividend or distribution is not so paid or made, the DSS
Conversion Price shall again be adjusted to be the DSS Conversion Price which
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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 502(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 DSS Common Stock.
Each share of DSS Common Stock upon conversion of Notes shall be
entitled to receive the appropriate number of Rights, if any, and the
certificates representing the DSS Common Stock issued upon such conversion shall
bear such legends, if any, in each case as provided by and subject to the terms
of the Rights Agreement as in effect at the time of such conversion. If the
Rights are separated from the DSS Common Stock in accordance with the provisions
of the Rights Agreement such that the Holders would thereafter not be entitled
to receive any such Rights in respect to the DSS Common Stock, issuable upon
conversion of such Notes, the DSS Conversion Price will be adjusted as provided
in this Section 502(d) on the separation date; provided that if such Rights
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expire, terminate or are redeemed by the Company, the DSS Conversion Price shall
again be adjusted to be the DSS Conversion Price which would then be in effect
if such separation had not occurred. In lieu of any such adjustment, the
Company may amend the Rights Agreement to provide that upon conversion of the
Notes the Holders will receive, in addition to the DSS Common Stock issuable
upon such conversion, the Rights which would have attached to such shares of DSS
Common Stock if the Rights had not become separated from the DSS Common Stock
pursuant to the provisions of the Rights Agreement.
Rights or warrants distributed by the Company to all holders of DSS
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 ("DSS Trigger Event"): (i) are deemed to be transferred with
such shares of DSS Common Stock; (ii) are not exercisable; and (iii) are also
issued in respect of future issuances of DSS Common Stock, shall be deemed not
to have been distributed for purposes of this Section 502 (and no adjustment to
the DSS Conversion Price under this Section 502 will be required) until the
occurrence of the earliest DSS Trigger Event, whereupon such rights and warrants
shall be deemed to have been distributed and an appropriate adjustment (if any
is required) to the DSS Conversion Price shall be made under this Section
502(d). If any such right or warrant, including any such existing rights or
warrants distributed prior to the date of this Supplemental 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 DSS Trigger Event or other event (of the type described in the
preceding sentence) with respect thereto that was counted for
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purposes of calculating a distribution amount for which an adjustment to the DSS
Conversion Price under this Section 502 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 DSS Conversion Price shall be readjusted
upon such final redemption or repurchase to give effect to such distribution or
DSS 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 DSS Common Stock with respect to such rights or warrants (assuming
such holder had retained such rights or warrants), made to all holders of DSS
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 DSS Conversion Price shall be
readjusted as if such rights and warrants had not been issued.
For purposes of this Section 502(d) and Sections 502(a) and (b), any
dividend or distribution to which this Section 502(d) is applicable that also
includes shares of DSS Common Stock, or rights or warrants to subscribe for or
purchase shares of DSS Common Stock (or both), 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 DSS Common Stock or rights or warrants
(and any DSS Conversion Price reduction required by this Section 502(d) with
respect to such dividend or distribution shall then be made) immediately
followed by (2) a dividend or distribution of such shares of DSS Common Stock or
such rights or warrants (and any further DSS Conversion Price reduction required
by Sections 502(a) and (b) with respect to such dividend or distribution shall
then be made), except (A) the Distribution 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 502(a) and (b)
and (B) any shares of DSS 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 502(a).
(e) In case the Company shall, by dividend or otherwise, distribute to
all holders of its DSS Common Stock cash (excluding (x) any quarterly cash
dividend on the DSS Common Stock to the extent the aggregate cash dividend per
share of DSS Common Stock in any fiscal quarter does not exceed the greater of
(A) the amount per share of DSS Common Stock of the next preceding quarterly
cash dividend on the DSS Common Stock to the extent that such preceding
quarterly dividend did not require any adjustment of the DSS Conversion Price
pursuant to this Section 502(e) (as adjusted to reflect subdivisions or
combinations of the DSS Common Stock), and (B) 3.75% of the arithmetic average
of the Closing Price (determined as set forth in Section 504(a)) during the ten
Trading Days (as defined in Section 504(e)) immediately prior to the date of
declaration of such dividend, and (y) any dividend or distribution in connection
with the liquidation, dissolution or winding up of the Company, whether
voluntary or involuntary), then, in such case, the DSS Conversion Price shall be
reduced so that the same shall equal the price determined
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by multiplying the DSS Conversion Price in effect immediately prior to the close
of business on such Distribution Record Date by a fraction of which the
numerator shall be the Current Market Price of the DSS Common Stock on the
Distribution Record Date less the amount of cash so distributed (and not
excluded as provided above) applicable to one share of DSS Common Stock and the
denominator shall be such Current Market Price of the DSS Common Stock, such
reduction to be effective immediately prior to the opening of business on the
day following the Distribution Record Date; provided, however, that in the event
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the portion of the cash so distributed applicable to one share of DSS Common
Stock is equal to or greater than the Current Market Price of the DSS Common
Stock on the Distribution Record Date, in lieu of the foregoing adjustment,
adequate provision shall be made so that each Holder shall have the right to
receive upon conversion the amount of cash such Holder would have received had
such Holder converted each Note on the Distribution Record Date. In the event
that such dividend or distribution is not so paid or made, the DSS Conversion
Price shall again be adjusted to be the DSS Conversion Price which would then be
in effect if such dividend or distribution had not been declared. If any
adjustment is required to be made as set forth in this Section 502(e) as a
result of a distribution that is a quarterly dividend, such adjustment shall be
based upon the amount by which such distribution exceeds the amount of the
quarterly cash dividend permitted to be excluded pursuant hereto. If an
adjustment is required to be made as set forth in this Section 502(e) above as a
result of a distribution that is not a quarterly dividend, such adjustment shall
be based upon the full amount of the distribution.
(f) In case a tender or exchange offer made by the Company or any
Subsidiary of the Company for all or any portion of the DSS Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders of consideration per share of
DSS 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 if Directors) that as of the last time (the "DSS Expiration Time")
tenders or exchanges may be made pursuant to such tender or exchange offer (as
it may be amended) that exceeds the Current Market Price of the DSS Common Stock
on the Trading Day next succeeding the DSS Expiration Time, the DSS Conversion
Price shall be reduced so that the same shall equal the price determined by
multiplying the DSS Conversion Price in effect immediately prior to the DSS
Expiration Time by a fraction of which the numerator shall be the number of
shares of DSS Common Stock outstanding (including any tendered or exchanged
shares) on the DSS Expiration Time multiplied by the Current Market Price of the
DSS Common Stock on the Trading Day next succeeding the DSS 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
DSS Expiration Time (the shares deemed so accepted, up to any such maximum,
being referred to as the "DSS Purchased Shares") and (y) the product of the
number of shares of DSS Common Stock outstanding (less any DSS Purchased Shares)
on the DSS Expiration Time and the Current Market
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Price of the DSS Common Stock on the Trading Day next succeeding the DSS
Expiration Time, such reduction to become effective immediately prior to the
opening of business on the day following the DSS Expiration Time. In the event
that the Company is obligated to purchase shares pursuant to any such tender or
exchange offer, but the Company is permanently prevented by applicable law from
effecting any such purchases or all such purchases are rescinded, the DSS
Conversion Price shall again be adjusted to be the DSS Conversion Price which
would then be in effect if such tender or exchange offer had not been made.
(g) In case of a tender or exchange offer made by a Person other than
the Company or any Subsidiary for an amount which increases the offeror's
ownership of DSS Common Stock and HDD Common Stock to more than 25% of the
aggregate amount of DSS Common Stock and HDD Common Stock outstanding and shall
involve the payment by such Person of consideration per share of DSS 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 last time (the "DSS Offer Expiration Time") tenders or
exchanges may be made pursuant to such tender or exchange offer (as it shall
have been amended) that exceeds the Current Market Price of the DSS Common Stock
on the Trading Day next succeeding the DSS Offer Expiration Time, and in which,
as of the DSS Offer Expiration Time the Board of Directors is not recommending
rejection of the offer, the DSS Conversion Price shall be reduced so that the
same shall equal the price determined by multiplying the DSS Conversion Price in
effect immediately prior to the DSS Offer Expiration Time by a fraction of which
the numerator shall be the number of shares of DSS Common Stock outstanding
(including any tendered or exchanged shares) on the DSS Offer Expiration Time
multiplied by the Current Market Price of the DSS Common Stock on the Trading
Day next succeeding the DSS Offer 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 DSS Offer Expiration Time (the
shares deemed so accepted, up to any such maximum, being referred to as the "DSS
Accepted Purchased Shares") and (y) the product of the number of shares of DSS
Common Stock outstanding (less any DSS Accepted Purchased Shares) on the DSS
Offer Expiration Time and the Current Market Price of the DSS Common Stock on
the Trading Day next succeeding the DSS Offer Expiration Time, such reduction to
become effective immediately prior to the opening of business on the day
following the DSS Offer 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 DSS Conversion Price shall
again be adjusted to be the DSS 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 502(g) shall not be made if,
as of the DSS Offer Expiration Time, the offering documents with respect to such
offer
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disclose a plan or intention to cause the Company to engage in any transaction
described in Article Eight of the Indenture.
Section 503 Adjustment of HDD Conversion Price.
The HDD Conversion Price shall be subject to adjustment from time to time
as follows:
(a) In case the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding HDD Common Stock in shares of HDD
Common Stock, the HDD 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 HDD Conversion Price by a fraction of which the numerator shall be the
number of shares of HDD 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 HDD
Common Stock held in the treasury of the Company. The Company will not pay any
dividend or make any distribution on shares of HDD Common Stock held in the
treasury of the Company. If any dividend or distribution of the type described
in this Section 503(a) is declared but not so paid or made, the HDD Conversion
Price shall again be adjusted to the HDD 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 HDD 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 HDD 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 HDD Conversion Price shall be adjusted so
that the same shall equal the price determined by multiplying the HDD Conversion
Price in effect immediately prior to the date fixed for determination of
stockholders entitled to receive such rights or warrants by a fraction of which
the numerator shall be the number of shares of HDD 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 HDD 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 HDD 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
-11-
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 HDD Common Stock are not delivered after the
expiration of such rights or warrants, the HDD Conversion Price shall be
readjusted to the HDD 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 HDD Common Stock actually
delivered. In the event that such rights or warrants are not so issued, the HDD
Conversion Price shall again be adjusted to be the HDD 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 HDD Common Stock at less than such Current Market Price, and in
determining the aggregate offering price of such shares of HDD 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 HDD Common Stock shall be subdivided
into a greater number of shares of HDD Common Stock, the HDD 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 HDD Common Stock shall be combined into a smaller
number of shares of HDD Common Stock, the HDD 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 HDD Common Stock shares of any class of capital stock of the
Company (other than any dividends or distributions to which Section 503(a)
applies) or evidences of its indebtedness or assets (including securities, but
excluding any rights or warrants referred to in Section 503(b), and excluding
any dividend or distribution (x) paid exclusively in cash or (y) referred to in
Section 503(a) (any of the foregoing hereinafter in this Section 503(d) called
the "HDD Distribution Securities")), then, in each such case (unless the Company
elects to reserve such HDD Distribution Securities for distribution to the
Holders upon the conversion of the Notes so that any such Holder converting
Notes will receive upon such conversion, in addition to the shares of HDD Common
Stock to which such Holder is entitled, the amount and kind of such HDD
Distribution Securities which such Holder would have received if such Holder had
converted its Notes immediately prior to the Distribution Record Date (as
defined in Section 504(c) for such distribution of the HDD Distribution
Securities)), the HDD Conversion Price shall be reduced so that the same shall
be equal to the price determined by multiplying the HDD Conversion Price in
effect on the Distribution Record Date with respect to such distribution by a
-12-
fraction of which the numerator shall be the Current Market Price per share of
the HDD Common Stock on such Distribution 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
Distribution Record Date of the portion of the Securities so distributed
applicable to one share of HDD Common Stock and the denominator shall be the
Current Market Price per share of the HDD Common Stock, such reduction to become
effective immediately prior to the opening of business on the day following such
Distribution Record Date; provided, however, that in the event the then fair
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market value (as so determined) of the portion of the HDD Distribution
Securities so distributed applicable to one share of HDD Common Stock is equal
to or greater than the Current Market Price of the HDD Common Stock on the
Distribution Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Holder shall have the right to receive upon
conversion the amount of HDD Distribution Securities such Holder would have
received had such Holder converted each Note on the Distribution Record Date.
In the event that such dividend or distribution is not so paid or made, the HDD
Conversion Price shall again be adjusted to be the HDD 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 503(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 HDD Common Stock.
Each share of HDD Common Stock upon conversion of Notes shall be entitled
to receive the appropriate number of Rights, if any, and the certificates
representing the HDD Common Stock issued upon such conversion shall bear such
legends, if any, in each case as provided by and subject to the terms of the
Rights Agreement as in effect at the time of such conversion. If the Rights are
separated from the HDD Common Stock in accordance with the provisions of the
Rights Agreement such that the Holders would thereafter not be entitled to
receive any such Rights in respect to the HDD Common Stock, issuable upon
conversion of such Notes, the HDD Conversion Price will be adjusted as provided
in this Section 503(d) on the separation date; provided that if such Rights
--------
expire, terminate or are redeemed by the Company, the HDD Conversion Price shall
again be adjusted to be the HDD Conversion Price which would then be in effect
if such separation had not occurred. In lieu of any such adjustment, the
Company may amend the Rights Agreement to provide that upon conversion of the
Notes the Holders will receive, in addition to the HDD Common Stock issuable
upon such conversion, the Rights which would have attached to such shares of HDD
Common Stock if the Rights had not become separated from the HDD Common Stock
pursuant to the provisions of the Rights Agreement.
Rights or warrants distributed by the Company to all holders of HDD 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 ("HDD
Trigger Event"): (i) are deemed to be transferred with such shares of HDD Common
Stock;
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(ii) are not exercisable; and (iii) are also issued in respect of future
issuances of HDD Common Stock, shall be deemed not to have been distributed for
purposes of this Section 503 (and no adjustment to the HDD Conversion Price
under this Section 503 will be required) until the occurrence of the earliest
HDD Trigger Event, whereupon such rights and warrants shall be deemed to have
been distributed and an appropriate adjustment (if any is required) to the HDD
Conversion Price shall be made under this Section 503(d). If any such right or
warrant, including any such existing rights or warrants distributed prior to the
date of this Supplemental 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 HDD
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 HDD Conversion Price under this Section
503 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
HDD Conversion Price shall be readjusted upon such final redemption or
repurchase to give effect to such distribution or HDD 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 HDD Common Stock with
respect to such rights or warrants (assuming such holder had retained such
rights or warrants), made to all holders of HDD 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 HDD Conversion Price shall be readjusted as if such rights and
warrants had not been issued.
For purposes of this Section 503(d) and Sections 503(a) and (b), any
dividend or distribution to which this Section 503(d) is applicable that also
includes shares of HDD Common Stock, or rights or warrants to subscribe for or
purchase shares of HDD Common Stock (or both), 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 HDD Common Stock or rights or warrants
(and any HDD Conversion Price reduction required by this Section 503(d) with
respect to such dividend or distribution shall then be made) immediately
followed by (2) a dividend or distribution of such shares of HDD Common Stock or
such rights or warrants (and any further HDD Conversion Price reduction required
by Sections 503(a) and (b) with respect to such dividend or distribution shall
then be made), except (A) the Distribution 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 503(a) and (b)
and (B) any shares of HDD Common Stock included in such
-14-
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
503(a).
(e) In case the Company shall, by dividend or otherwise, distribute to
all holders of its HDD Common Stock cash (excluding (x) any quarterly cash
dividend on the HDD Common Stock to the extent the aggregate cash dividend per
share of HDD Common Stock in any fiscal quarter does not exceed the greater of
(A) the amount per share of HDD Common Stock of the next preceding quarterly
cash dividend on the HDD Common Stock to the extent that such preceding
quarterly dividend did not require any adjustment of the HDD Conversion Price
pursuant to this Section 503(e) (as adjusted to reflect subdivisions or
combinations of the HDD Common Stock), and (B) 3.75% of the arithmetic average
of the Closing Price (determined as set forth in Section 504(a)) during the ten
Trading Days (as defined in Section 504(e)) immediately prior to the date of
declaration of such dividend, and (y) any dividend or distribution in connection
with the liquidation, dissolution or winding up of the Company, whether
voluntary or involuntary), then, in such case, the HDD Conversion Price shall be
reduced so that the same shall equal the price determined by multiplying the HDD
Conversion Price in effect immediately prior to the close of business on such
Distribution Record Date by a fraction of which the numerator shall be the
Current Market Price of the HDD Common Stock on the Distribution Record Date
less the amount of cash so distributed (and not excluded as provided above)
applicable to one share of HDD Common Stock and the denominator shall be such
Current Market Price of the HDD Common Stock, such reduction to be effective
immediately prior to the opening of business on the day following the
Distribution Record Date; provided, however, that in the event the portion of
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the cash so distributed applicable to one share of HDD Common Stock is equal to
or greater than the Current Market Price of the HDD Common Stock on the
Distribution Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Holder shall have the right to receive upon
conversion the amount of cash such Holder would have received had such Holder
converted each Note on the Distribution Record Date. In the event that such
dividend or distribution is not so paid or made, the HDD Conversion Price shall
again be adjusted to be the HDD Conversion Price which would then be in effect
if such dividend or distribution had not been declared. If any adjustment is
required to be made as set forth in this Section 503(e) as a result of a
distribution that is a quarterly dividend, such adjustment shall be based upon
the amount by which such distribution exceeds the amount of the quarterly cash
dividend permitted to be excluded pursuant hereto. If an adjustment is required
to be made as set forth in this Section 503(e) above as a result of a
distribution that is not a quarterly dividend, such adjustment shall be based
upon the full amount of the distribution.
(f) In case a tender or exchange offer made by the Company or any
Subsidiary of the Company for all or any portion of the HDD Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders of consideration per share of
HDD 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 if
-15-
Directors) that as of the last time (the "HDD Expiration Time") tenders or
exchanges may be made pursuant to such tender or exchange offer (as it may be
amended) that exceeds the Current Market Price of the HDD Common Stock on the
Trading Day next succeeding the HDD Expiration Time, the HDD Conversion Price
shall be reduced so that the same shall equal the price determined by
multiplying the HDD Conversion Price in effect immediately prior to the HDD
Expiration Time by a fraction of which the numerator shall be the number of
shares of HDD Common Stock outstanding (including any tendered or exchanged
shares) on the HDD Expiration Time multiplied by the Current Market Price of the
HDD Common Stock on the Trading Day next succeeding the HDD 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
HDD Expiration Time (the shares deemed so accepted, up to any such maximum,
being referred to as the "HDD Purchased Shares") and (y) the product of the
number of shares of HDD Common Stock outstanding (less any HDD Purchased Shares)
on the HDD Expiration Time and the Current Market Price of the HDD Common Stock
on the Trading Day next succeeding the HDD Expiration Time, such reduction to
become effective immediately prior to the opening of business on the day
following the HDD Expiration Time. In the event that the Company is obligated to
purchase shares pursuant to any such tender or exchange offer, but the Company
is permanently prevented by applicable law from effecting any such purchases or
all such purchases are rescinded, the HDD Conversion Price shall again be
adjusted to be the HDD Conversion Price which would then be in effect if such
tender or exchange offer had not been made.
(g) In case of a tender or exchange offer made by a Person other than
the Company or any Subsidiary for an amount which increases the offeror's
ownership of HDD Common Stock and DSS Common Stock to more than 25% of the
aggregate HDD Common Stock and DSS Common Stock outstanding and shall involve
the payment by such Person of consideration per share of HDD 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 last time (the "DHH Offer Expiration Time") tenders or
exchanges may be made pursuant to such tender or exchange offer (as it shall
have been amended) that exceeds the Current Market Price of the HDD Common Stock
on the Trading Day next succeeding the DHH Offer Expiration Time, and in which,
as of the DHH Offer Expiration Time the Board of Directors is not recommending
rejection of the offer, the HDD Conversion Price shall be reduced so that the
same shall equal the price determined by multiplying the HDD Conversion Price in
effect immediately prior to the DHH Offer Expiration Time by a fraction of which
the numerator shall be the number of shares of HDD Common Stock outstanding
(including any tendered or exchanged shares) on the DHH Offer Expiration Time
multiplied by the Current Market Price of the HDD Common Stock on the Trading
Day next succeeding the DHH Offer Expiration Time and the denominator shall be
the sum of (x) the fair
-16-
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 DHH Offer Expiration Time (the shares deemed so
accepted, up to any such maximum, being referred to as the "DHH Accepted
Purchased Shares") and (y) the product of the number of shares of HDD Common
Stock outstanding (less any DHH Accepted Purchased Shares) on the DHH Offer
Expiration Time and the Current Market Price of the DSS Common Stock on the
Trading Day next succeeding the DHH Offer Expiration Time, such reduction to
become effective immediately prior to the opening of business on the day
following the DHH Offer 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 HDD Conversion Price shall
again be adjusted to be the HDD 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 503(g) shall not be made if,
as of the DHH Offer 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 Eight of the Indenture.
504 Certain Definitions. For purposes of this Article Five, the following
terms shall have the meaning indicated:
(a) "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.
(b) "Current Market Price" shall mean the average of the daily Closing
Prices per share of DSS Common Stock or HDD 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 or Fundamental Change requiring such computation) that
requires an adjustment to the DSS Conversion Price or the HDD Conversion Price,
as the Case may be, pursuant to this Section 5.02 occurs during such ten
consecutive
-17-
Trading Days, the Closing Price for each Trading Day prior to the "ex" date for
such other event shall be adjusted by multiplying such Closing Price by the same
fraction by which the DSS Conversion Price or the HDD Conversion Price, as the
case may be 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, distribution or
Fundamental Change requiring such computation) that requires an adjustment to
the Conversion Price pursuant to this Section 5.02 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 DSS Conversion Price or the
HDD Conversion Price, as the case may be, is so required to be adjusted as a
result of such other event, and (3) if the "ex" date for the issuance,
distribution or Fundamental Change 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
502(d), (f) or (g), in the case of DSS Common Stock, or Section 5.03 (d), (f) or
(g), in the case of HDD Common Stock, 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 DSS
Common Stock or HDD Common Stock, as the case may be, as of the close of
business on the day before such "ex" date. For purposes of any computation under
Section 502(f) or (g) in the case of DSS Common Stock, or 503(f) or (g) in the
case of HDD Common Stock, 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
DSS Common Stock or HDD Common stock, as the case may be, for such day and the
next two succeeding Trading Days; provided, however, that if the "ex"
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date for any event (other than the tender or exchange offer requiring such
computation) that requires an adjustment to the Conversion Price pursuant to
this Section 5.02 occurs on or after the DSS Expiration Time, HDD Expiration
Time, DSS Offer Expiration Time or DHH Offer Expiration Time, as the case may
be, 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 DSS Conversion Price or the HDD
Conversion Price, as the case may be, 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 DSS Common Stock or HDD Common Stock, as the case may be, trades
regular way on the relevant exchange or in the relevant market from which the
Closing Price was obtained without the right to receive such issuance or
distribution, (2) when used with respect to any subdivision or combination of
shares of DSS Common Stock or HDD Common Stock, as the case
-18-
may be, means the first date on which the DSS Common Stock or HDD Common Stock,
as the case may be, 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 DSS Common Stock or HDD Common Stock, as the case may be, trades
regular way on such exchange or in such market after the DSS Expiration Time,
HDD Expiration Time, DSS Offer Expiration Time or DHH Offer Expiration Time, as
the case may be, of such offer.
(c) "Distribution Record Date" shall mean, with respect to any
dividend, distribution or other transaction or event in which the holders of DSS
Common Stock or HDD Common Stock, as the case may be, have the right to receive
any cash, securities or other property or in which such Common Stock (or other
applicable security) is exchanged for or converted into any combination of cash,
securities or other property, the date fixed for determination of stockholders
entitled to receive such cash, securities or other property (whether such date
is fixed by the Board of Directors or by statute, contract or otherwise).
(d) "fair market value" shall mean the amount which a willing buyer
would pay a willing seller in an arm's length transaction.
(e) "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 on 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.
505 General Conversion Provisions
(a) No adjustment in the DSS Conversion Price or the HDD Conversion
Price shall be required unless such adjustment would require an increase or
decrease of at least 1% in either such price; provided, however, that any
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adjustments which by reason of this Section 505(a) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment of
the DSS Conversion Price or the HDD Conversion Price, as the case may be. All
calculations under this Article Five shall be made by the Company and shall be
made to the nearest one tenth of a cent or to the nearest one hundredth of a
share, as the case may be. No adjustment need be made for rights to purchase
Common Stock pursuant to a Company plan for reinvestment of dividends or
interest. To the extent the Notes become convertible into cash, assets,
property or securities (other than capital stock of the Company), no adjustment
need be made thereafter as to the cash, assets, property or such securities.
Interest will not accrue on the cash.
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(b) Whenever the DSS Conversion Price or the HDD Conversion Price, as
the case may be, 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 DSS Conversion Price and the HDD 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 DSS Conversion Price or the HDD
Conversion Price, as the case may be, setting forth the adjusted DSS Conversion
Price or HDD Conversion Price, as the case may be, and the date on which each
adjustment becomes effective and shall mail such notice of such adjustment to
the Holder of each Note at his last address appearing on the Security Register
within 20 days after execution thereof. Failure to deliver such notice shall
not affect the legality or validity of any such adjustment.
(c) In any case in which this Article Five provides that an adjustment
shall become effective immediately after a record date for an event, the Company
may defer until the occurrence of such event (i) issuing to the Holder of any
Note converted after such record date and before the occurrence of such event
the additional shares of DSS Common Stock or HDD Common Stock issuable upon such
conversion by reason of the adjustment required by such event over and above the
DSS Common Stock and HDD 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 1403 of the Indenture.
(d) For purposes of this Article Five, the number of shares of DSS
Common Stock and HDD 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 DSS
Common Stock or HDD Common Stock. The Company will not pay any dividend or make
any distribution on shares of DSS Common Stock or HDD Common Stock held in the
treasury of the Company.
(e) The Company may make such reductions in the DSS Conversion Price
and HDD Conversion Price, in addition to those required by this Sections 502 or
503, as the Board of Directors considers to be advisable to avoid or diminish
any income tax to holders of DSS Common Stock or HDD Common Stock, respectively,
or rights to purchase DSS Common Stock or HDD Common Stock, as the case may be,
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 DSS Conversion Price or the HDD Conversion Price by any amount
for any period of time if the period is at least twenty (20) 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 DSS Conversion Price or
the
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HDD Conversion Price, as the case may be, is reduced pursuant to the
preceding sentence, the Company shall mail to holders of record of the
Notes a notice of the reduction at least fifteen (15) days prior to the
date the reduction takes effect, and such notice shall state the reduced
DSS Conversion Price or HDD Conversion Price and the period during which it
will be in effect.
Section 106 Amendment to Annex 1.
Annex 1 of the First Supplemental Indenture is hereby replaced in its
entirety with Annex 1 hereto.
ARTICLE TWO
MISCELLANEOUS
Section 201 Reference to and Effect on the Indenture.
This Supplemental Indenture shall be construed as supplemental to the
Indenture and all the terms and conditions of this Supplemental Indenture shall
be deemed to be part of the terms and conditions of the Indenture. This
Supplemental Indenture is subject to the provisions of the Trust Indenture Act,
and shall, to the extent applicable, be governed by such provisions.
Section 202 Supplemental Indenture May be Executed In Counterparts.
This instrument 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.
Section 203 Effect of Headings.
The Article and Section headings herein are for convenience only and shall
not affect the construction hereof.
Section 204 Separability.
In case any one or more of the provisions contained in this Supplemental
Indenture or in the Notes shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not effect any other provisions of this Supplemental Indenture or of the
Notes, but this Supplemental Indenture and the Notes shall be construed as if
such invalid or illegal or unenforceable provision had never been contained
herein or therein.
Section 205 Governing Law.
THIS SUPPLEMENTAL INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAW
OF THE STATE OF NEW YORK.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed all as of the day and year first above written.
Quantum Corporation
By: /s/ Xxxxxxx X. Xxxxxxx
_____________________________________
Xxxxxxx X. Xxxxxxx
Executive Vice President, Finance and
Chief Financial Officer
LaSalle National Bank, as Trustee
By: /s/ Xxxxxxxx X. Xxxxxx
_____________________________________
Xxxxxxxx X. Xxxxxx
Assistant Vice President
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Annex 1
[Form of Face of Security]
[If the Security is a Global Security, insert -- THIS SECURITY IS A GLOBAL
SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY MAY
NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER
OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.]
QUANTUM CORPORATION
7% Convertible Subordinated Note due 2004
No. __________ $ ____________
CUSIP: ____________
Quantum Corporation, a corporation duly organized and existing under the
laws of Delaware (herein called the "Company," which term includes any successor
Person under the Indenture hereinafter referred to), for value received, hereby
promises to pay to ________________, or registered assigns, the principal sum of
___________________ Dollars on August 1, 2004 and to pay interest thereon from
August 1, 1997 or from the most recent Interest Payment Date to which interest
has been paid or duly provided for, semi-annually on February 1 and August 1 in
each year, commencing February 1, 1998, at the rate of 7% per annum, until the
principal hereof is paid or made available for payment. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on the Regular Record Date for such interest, which shall be the January 15 or
July 15 (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Security (or
one or more Predecessor Securities) is registered at the close of business on a
Special Record Date for the payment of such Defaulted Interest to be fixed by
the Trustee, notice whereof shall be given to Holders of Securities of this
series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities of this series may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in said Indenture.
Payment of the principal of (and premium, if any) and any interest on this
Security will be made at the office or agency of the Company maintained for such
purpose in the Borough of Manhattan, The City of New York, or at the option of
the Holder of this Security, at the Corporate Trust Office, in such coin or
currency of the United States of America as at the time of payment is
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legal tender for payment of public and private debts; provided, however, that at
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the option of the Company payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register; provided, further, that a Holder with an aggregate principle
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amount in excess of $5,000,000 will be paid by wire transfer in immediately
available funds at the election of such Holder.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be signed
manually or by facsimile by their duly authorized officers and by its corporate
seal to be affixed or imported hereon.
Dated: ___________
QUANTUM CORPORATION
By: ___________________________
Title:
Attest:
By: ______________________________
Title:
The Trustee's certificates of authentication shall be in substantially the
following form:
This is one of the Securities of the series designated herein referred to
in the within-mentioned Indenture.
LASALLE NATIONAL BANK
As Trustee
By: ___________________________
Authorized Officer
Form of Reverse of Security
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of August 1, 1997 (herein called the
"Indenture," which term shall have the meaning assigned to it in such
instrument), between the Company and LaSalle National Bank, as Trustee (herein
called the "Trustee," which term includes any successor trustee under the
Indenture), and reference is hereby
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made to the Indenture and all indentures supplemental thereto for a statement of
the respective rights, limitations of rights, duties and immunities thereunder
of the Company, the Trustee, the holders of Senior Indebtedness and the Holders
of the Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof, limited in aggregate principal amount to $287,500,000, and is
issued pursuant to a Supplemental Trust Indenture supplementing the Indenture,
dated as of August 1, 1997, from the Company to Trustee relating to the issuance
of the "7% Convertible Notes due 2004" of this series (the "Supplemental
Indenture").
The Securities will not be subject to redemption prior to August 1, 1999
and will be redeemable on and after such date at the option of the Company, in
whole or in part, upon not less than 15 nor more than 60 days' notice to the
Holders, at the Redemption Prices (expressed as a percentage of principal
amount) set forth below; provided, however, that the Securities will not be
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redeemable following August 1, 1999, and before August 1, 2001, unless the fair
market value of the DSS Common Stock and HDD Common Stock issuable upon the
conversion of $1,000 of principal amount of Notes, based on the Closing Prices
for at least 20 Trading Days within a period of 30 consecutive Trading Days
ending within five Trading Days prior to the notice of redemption, exceeds
$1,250 (using the same Trading Days for determining the Closing Prices of both
the DSS Common Stock and the HDD Common Stock).
The Redemption Price (expressed as a percentage of principal amount) is as
follows for the 12 month periods beginning on August 1 of the following years:
Year Redemption Price
---- ----------------
1999............................. 105%
2000............................. 104%
2001............................. 103%
2002............................. 102%
2003............................. 101%
and 100% at August 1, 2004, in each case together with accrued and unpaid
interest to, but excluding, the Redemption Date; provided, however, that
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interest installments whose Stated Maturity is on such Redemption Date will be
payable to the Holders of such Securities, or one or more Predecessor
Securities, of record at the close of business on the relevant Record Dates
referred to on the face hereof, all as provided in the Indenture.
The Securities are not subject to redemption through operation of any
sinking fund.
In the event of redemption of this Security in part only, a new Security or
Securities of this series and of like tenor for the unredeemed portion hereof
will be issued in the name of the Holder hereof upon the cancellation hereof.
If a Fundamental Change (as defined in the Supplemental Indenture) occurs
at any time prior to August 1, 2004, the Securities will be redeemable on the
30th day after notice thereof at the option of the Holder. Such payment shall
be made at the following prices (expressed as a percentage of
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principal amount) in the event of a Fundamental Change occurring during the 12
month period beginning August 1 of the following years:
Year Percentage Year Percentage
---- ---------- ---- ----------
1997 ............. 107% 2001 .............. 103%
1998 ............. 106 2002 .............. 102
1999 ............. 105 2003 .............. 101
2000 ............. 104
and 100% at August 1, 2004; provided in each case that if the Applicable Price
(as defined in the Supplemental Indenture) is less than the Reference Market
Price (as defined in the Supplemental Indenture), the Company shall redeem such
Securities at a price equal to the foregoing redemption price multiplied by the
fraction obtained by dividing the Applicable Price by the Reference Market
Price. In each case, the Company shall also pay accrued interest, if any, on
such Securities to, but excluding, the Repurchase Date; provided, however, that
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interest installments whose Stated Maturity is on such Repurchase Date will be
paid to the Holders of such Securities, or one or more Predecessor Securities,
of record at the close of business on the relevant Record Dates referred to on
the face hereof, all as provided in the Supplemental Indenture. The Company
shall mail to all Holders a notice of the occurrence of a Fundamental Change and
of the redemption right arising as a result thereof on or before the 10th day
after the occurrence of such Fundamental Change. For a Security to be so repaid
at the option of the Holder, the Company must receive at the office or agency of
the Company maintained for that purpose in the Borough of Manhattan, the City of
New York, or, at the option of the Holder, the Corporate Trust Office of the
Trustee, such Security with the form entitled "Option to Elect Redemption Upon a
Fundamental Change" on the reverse thereof duly completed, together with such
Securities duly endorsed for transfer, on or before the 30th day after the date
of such notice (or if such 30th day is not a Business Day, the immediately
succeeding Business Day).
The indebtedness evidenced by this Security is, to the extent and in the
manner provided in the Indenture, subordinate and subject in right of payment to
the prior payment in full of all Senior Indebtedness of the Company, and this
Security is issued subject to such provisions of the Indenture with respect
thereto. Each Holder of this Security, by accepting the same, (a) agrees to and
shall be bound by such provisions, (b) authorizes and directs the Trustee on his
or her behalf to take such action as may be necessary or appropriate to
effectuate the subordination so provided and (c) appoints the Trustee as his or
her attorney-in-fact for any and all such purposes.
The Indenture contains provisions for defeasance at any time of the entire
indebtedness of this Security or certain restrictive covenants and Events of
Default with respect to this Security, in each case upon compliance with certain
conditions set forth in the Indenture, except that the Company will not be able
to defease the right of the Holders to convert this Security pursuant to Article
Fourteen of the Indenture.
Subject to the provisions of the Indenture, the Holder of this Security is
entitled, at its option, at any time on or before August 1, 2004 (except that,
in case this Security or any portion hereof shall be redeemed, such right shall
terminate with respect to this Security or portion hereof, as the case
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may be, so redeemed at the close of business on the first Business Day next
preceding the date fixed for redemption as provided in the Indenture, unless the
Company defaults in making the payment due upon redemption or except as
otherwise provided in the Indenture), to convert any $1000 of principal of Notes
held by such holder into the number of DSS Common Stock obtained by dividing
$666.67 by the DSS Conversion Price (initially $30.833) and into the number of
HDD Common Stock obtained by dividing $333.33 by the HDD Conversion Price
(initially $30.833), as the HDD Conversion Price and the DSS Conversion Price
may be adjusted from time to time, upon surrender of this Security, together
with the conversion notice hereon duly executed, to be accompanied (if so
required by the Company) by instruments of transfer, in form satisfactory to the
Company and to the Trustee, duly executed by the Holder or by its duly
authorized attorney in writing. Such surrender shall, if made during any period
beginning at the close of business on a Regular Record Date and ending at the
opening of business on the Interest Payment Date next following such Regular
Record Date (unless this Security or the portion being converted shall have been
called for redemption on a Redemption Date during the period beginning at the
close of business on a Regular Record Date and ending at the opening of business
on the first Business Day after the next succeeding Interest Payment Date, or if
such Interest Payment Date is not a Business Day, the second such Business Day),
also be accompanied by payment in funds acceptable to the Company of an amount
equal to the interest payable on such Interest Payment Date on the principal
amount of this Security then being converted. Subject to the aforesaid
requirement for payment and, in the case of a conversion after the Regular
Record Date next preceding any Interest Payment Date and on or before such
Interest Payment Date, to the right of the Holder of this Security (or any
Predecessor Security) of record at such Regular Record Date to receive an
installment of interest (with certain exceptions provided in the Indenture), no
adjustment is to be made on conversion for interest accrued hereon or for
dividends on shares of Common Stock issued on conversion. The Company is not
required to issue fractional shares upon any such conversion, but shall make
adjustment therefor as provided in the Indenture. Each of the DSS Conversion
Price and the HDD Conversion Price is subject to adjustment as provided in the
Indenture. In the event of conversion of this Security in part only, a new
Security or Securities for the unconverted portion hereof shall be issued in the
name of the Holder hereof upon the cancellation hereof.
If an Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of more than 50% in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
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As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonable indemnity, and the Trustee
shall not have received from the Holders of a majority in principal amount of
Securities of this series at the time Outstanding a direction inconsistent with
such request, and shall have failed to institute any such proceeding, for 60
days after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of principal hereof or any premium or interest hereon
on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security 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 Security at the times, place and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in any place where the principal of and any premium and
interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or its attorney duly
authorized in writing, and thereupon one or more new Securities of this series
and of like tenor, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
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Abbreviations
The following abbreviations, when used in the inscription of the face of
this Security, 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
TEN ENT - as tenants by the entireties
(Cust)
JT TEN - as joint tenants with right of Custodian_________under Uniform
survivorship and not as tenants (Minor)
in common Gifts to Minors Act ___________
(State)
Additional abbreviations may also be used though not in the above list.
Conversion Notice
To Quantum Corporation:
The undersigned owner of this Security hereby irrevocably exercises the
option to convert this Security, or portion hereof (which is $1,000 or an
integral multiple thereof) below designated, into shares of DSS Common Stock and
HDD Common Stock of the Company in accordance with the terms of the Indenture
referred to in this Security, and directs that the shares issuable and
deliverable upon the conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered Holder hereof unless a
different name has been indicated below. If this Notice is being delivered on a
date after the close of business on a Regular Record Date and prior to the
opening of business on the related Interest Payment Date (unless this Security
or the portion thereof being converted has been called for redemption on a
Redemption Date after the close of business on a Regular Record Date and prior
to the opening of business on the first Business Day after the next succeeding
Interest Payment Date, or if such Interest Payment Date is not a Business Day,
the next such Business Day), this Notice is accompanied by payment, in funds
acceptable to the Company, of an amount equal to the interest payable on such
Interest Payment Date of the principal of this Security to be converted. If
shares are to be issued in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect hereto. Any amount
required to be paid by the undersigned on account of interest accompanies this
Security.
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Principal Amount to be Converted
(in an integral multiple of $1,000, if less
than all)
$ __________
Dated:___________
_____________________________
_____________________________
Signature(s) must be
guaranteed by a qualified
guarantor institution with
membership in an approved
signature guarantee program
pursuant to Rule 17Ad-15
under the Securities Exchange
Act of 1934 if shares of DSS
Common Stock and HDD Common
Stock are to be delivered, or
Securities to be issued,
other than to and in the name
of the registered owner.
_____________________________
Signature Guaranty
Fill in for registration of shares of DSS Common Stock, HDD Common Stock
and Security if to be issued otherwise than to the registered Holder.
_______________________________ _________________________________
(Name) Social Security or Other Taxpayer
Identification Number
_______________________________
(Address)
_______________________________
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OPTION TO ELECT REDEMPTION
UPON A FUNDAMENTAL CHANGE
To: Quantum Corporation
The undersigned registered owner of this Security hereby irrevocably
acknowledges receipt of a notice from Quantum Corporation (the "Company") as to
the occurrence of a Fundamental Change with respect to the Company and requests
and instructs the Company to redeem the entire principal amount of this
Security, 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 Security at the redemption price, together with accrued
interest to, but excluding, such date, to the registered Holder hereof.
Dated: _______________ _______________________________
_______________________________
Signature(s)
Signature(s) must be guaranteed by
a qualified guarantor institution
with membership in an __ approved
signature guarantee program
pursuant to Rule 17Ad-15 under the
Securities Exchange Act of 1934.
_______________________________
Signature Guaranty
Principal amount to be redeemed
(in an integral multiple of $1,000, if less than all):
_____________________________________________
NOTICE: The signature to the foregoing Election must correspond to the Name as
written upon the face of this Security in every particular, without alteration
or any change whatsoever.
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