EXHIBIT 4.1
TYCO INTERNATIONAL GROUP S.A.
Zero Coupon Convertible Debentures due February 12, 2021
__________________________________________________________
INDENTURE
Dated as of February 12, 2001
__________________________________________________________
Tyco International Ltd.
GUARANTOR
State Street Bank and Trust Company
TRUSTEE
__________________________________________________________
TABLE OF CONTENTS
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Page
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE..................................... 1
Section 1.1 Definitions........................................ 1
Section 1.2 Other Definitions.................................. 7
Section 1.3 Incorporation by Reference of Trust Indenture Act.. 8
Section 1.4 Rules of Construction.............................. 8
Section 1.5 Acts of Holders.................................... 9
ARTICLE II
THE SECURITIES................................................................. 10
Section 2.1 Form and Dating.................................... 10
Section 2.2 Execution and Authentication....................... 11
Section 2.3 Registrar, Paying Agent and Conversion Agent....... 12
Section 2.4 Paying Agent to Hold Money and Securities in Trust. 13
Section 2.5 Securityholder Lists............................... 13
Section 2.6 Transfer and Exchange.............................. 13
Section 2.7 Replacement Securities............................. 15
Section 2.8 Outstanding Securities; Determinations of Holders'
Action............................................. 16
Section 2.9 Temporary Securities............................... 17
Section 2.10 Cancellation....................................... 18
Section 2.11 Persons Deemed Owners.............................. 18
Section 2.12 Global Securities.................................. 18
Section 2.13 CUSIP Numbers...................................... 21
ARTICLE III
REDEMPTION AND PURCHASES....................................................... 22
Section 3.1 Right to Redeem; Notices to Trustee................ 22
Section 3.2 Selection of Securities to Be Redeemed............. 22
Section 3.3 Notice of Redemption............................... 23
Section 3.4 Effect of Notice of Redemption..................... 24
Section 3.5 Deposit of Redemption Price........................ 24
Section 3.6 Securities Redeemed in Part........................ 24
Section 3.7 Conversion Arrangement on Call for Redemption...... 24
Section 3.8 Purchase of Securities at Option of the Holder..... 25
Section 3.9 Purchase of Securities at Option of the Holder
upon Change in Control............................. 33
Section 3.10 Effect of Purchase Notice or Change in Control
Purchase Notice.................................... 37
Section 3.11 Deposit of Purchase Price or Change in Control
Purchase Price..................................... 38
Section 3.12 Securities Purchased in Part....................... 39
Section 3.13 Covenant to Comply With Securities Laws Upon
Purchase of Securities............................. 39
Section 3.14 Repayment to the Company........................... 39
Section 3.15 Redemption Upon Changes in Withholding
Taxes.............................................. 40
ARTICLE IV
COVENANTS...................................................................... 40
Section 4.1 Payment of Securities.............................. 40
Section 4.2 SEC and Other Reports.............................. 41
Section 4.3 Compliance Certificate............................. 41
Section 4.4 Further Instruments and Acts....................... 42
Section 4.5 Maintenance of Office or Agency.................... 42
Section 4.6 Delivery........................................... 42
Section 4.7 Calculation of Original Issue Discount............. 43
Section 4.8 Payment of Additional Amounts...................... 43
ARTICLE V
SUCCESSOR CORPORATION.......................................................... 45
Section 5.1 When Company or Guarantor May Merge or Transfer
Assets............................................. 45
ARTICLE VI
DEFAULTS AND REMEDIES.......................................................... 47
Section 6.1 Events of Default.................................. 47
Section 6.2 Acceleration....................................... 49
Section 6.3 Other Remedies..................................... 49
Section 6.4 Waiver of Past Defaults............................ 49
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Section 6.5 Control by Majority................................ 50
Section 6.6 Limitation on Suits................................ 50
Section 6.7 Rights of Holders to Receive Payment............... 51
Section 6.8 Collection Suit by Trustee......................... 51
Section 6.9 Trustee May File Proofs of Claim................... 51
Section 6.10 Priorities......................................... 52
Section 6.11 Undertaking for Costs.............................. 52
Section 6.12 Waiver of Stay, Extension or Usury Laws............ 53
ARTICLE VII
TRUSTEE........................................................................ 53
Section 7.1 Duties of Trustee.................................. 53
Section 7.2 Rights of Trustee.................................. 55
Section 7.3 Individual Rights of Trustee....................... 56
Section 7.4 Trustee's Disclaimer............................... 57
Section 7.5 Notice of Defaults................................. 57
Section 7.6 Reports by Trustee to Holders...................... 57
Section 7.7 Compensation and Indemnity......................... 57
Section 7.8 Replacement of Trustee............................. 58
Section 7.9 Successor Trustee by Xxxxxx........................ 59
Section 7.10 Eligibility; Disqualification...................... 59
Section 7.11 Preferential Collection of Claims Against
Company............................................ 59
ARTICLE VIII
DISCHARGE OF INDENTURE......................................................... 60
Section 8.1 Discharge of Liability on Securities............... 60
Section 8.2 Repayment to the Company........................... 60
ARTICLE IX
AMENDMENTS..................................................................... 60
Section 9.1 Without Consent of Holders......................... 60
Section 9.2 With Consent of Holders............................ 61
Section 9.3 Compliance with Trust Indenture Act................ 62
Section 9.4 Revocation and Effect of Consents, Xxxxxxx and
Actions............................................ 62
Section 9.5 Notation on or Exchange of Securities.............. 62
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Section 9.6 Trustee to Sign Supplemental Indentures............ 62
Section 9.7 Effect of Supplemental Indentures.................. 63
ARTICLE X
CONVERSIONS.................................................................... 63
Section 10.1 Conversion Privilege............................... 63
Section 10.2 Conversion Procedure............................... 64
Section 10.3 Fractional Shares.................................. 65
Section 10.4 Taxes on Conversion................................ 66
Section 10.5 Company to Provide Stock........................... 66
Section 10.6 Adjustment for Change In Capital Stock............. 66
Section 10.7 Adjustment for Rights Issue........................ 67
Section 10.8 Adjustment for Other Distributions................. 69
Section 10.9 When Adjustment May Be Deferred.................... 71
Section 10.10 When No Adjustment Required........................ 71
Section 10.11 Notice of Adjustment............................... 72
Section 10.12 Voluntary Increase................................. 72
Section 10.13 Notice of Certain Transactions..................... 72
Section 10.14 Reorganization of Tyco; Special Distributions...... 73
Section 10.15 Company or Tyco Determination Final................ 74
Section 10.16 Trustee's Adjustment Disclaimer.................... 74
Section 10.17 Simultaneous Adjustments........................... 74
Section 10.18 Successive Adjustments............................. 74
ARTICLE XI
GUARANTEES..................................................................... 74
Section 11.1 Guarantees......................................... 74
Section 11.2 Execution and Delivery of Guarantees............... 76
Section 11.3 Release of Guarantees.............................. 77
ARTICLE XII
MISCELLANEOUS.................................................................. 78
Section 12.1 Trust Indenture Act Controls....................... 78
Section 12.2 Notices............................................ 78
Section 12.3 Communication by Holders with Other Holders........ 79
Section 12.4 Certificate and Opinion as to Conditions
Precedent.......................................... 79
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Section 12.5 Statements Required in Certificate or Opinion...... 80
Section 12.6 Separability Clause................................ 80
Section 12.7 Rules by Trustee, Paying Agent, Conversion
Agent and Registrar............................... 80
Section 12.8 Legal Holidays..................................... 80
Section 12.9 GOVERNING LAW...................................... 80
Section 12.10 No Recourse Against Others......................... 81
Section 12.11 Successors......................................... 81
Section 12.12 Multiple Originals................................. 81
Section 12.13 Submission to Jurisdiction......................... 81
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INDENTURE dated as of February 12, 2001 among TYCO INTERNATIONAL
GROUP S.A., a Luxembourg company (the "Company"), TYCO INTERNATIONAL LTD., a
Bermuda company ("Tyco" and, in its capacity as guarantor, the "Guarantor"), and
STATE STREET BANK AND TRUST COMPANY (the "Trustee").
Each party agrees as follows for the benefit of the other parties and
for the equal and ratable benefit of the Holders of the Company's Zero Coupon
Convertible Debentures due February 12, 2021 ("Securities"):
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Definitions.
"144A Global Security" means a permanent Global Security in the form
of the Security attached hereto as Exhibit A-1, and that is deposited with and
registered in the name of the Depositary, representing Securities sold in
reliance on Rule 144A under the Securities Act.
"Affiliate" of any specified person means any other person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For the purposes of this definition,
"control" when used with respect to any specified person means the power to
direct or cause the direction of the management and policies of such person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Security, in each case to the
extent applicable to such transaction and as in effect from time to time.
"Board of Directors" means either the board of directors of the
Company or the Guarantor, as the case may be, or any duly authorized committee
of such board.
"Board Resolution" means a copy of one or more resolutions, certified
by an Officer of the Company or the Guarantor, as the case may be, to have been
duly adopted or consented to by the applicable Board of Directors and to be in
full force and effect, and delivered to the Trustee.
"Business Day" means, with respect to any Security, a day that in the
City of New York and the City of Boston, Massachusetts, is not a day on which
banking institutions are authorized by law or regulation to close.
"Capital Stock" for any corporation means any and all shares, inter
ests, rights to purchase, warrants, options, participations or other equivalents
of or interests in (however designated) stock issued by that corporation.
"Certificated Securities" means Securities that are in the form of the
Securities attached hereto as Exhibit A-2.
"Common Shares" shall mean the Common Shares, $0.20 par value per
share, of Tyco as they exist on the date of this Indenture or any other shares
of Capital Stock of Tyco into which the Common Shares shall be reclassified or
changed.
"Company" means the party named as the "Company" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by any two Officers.
"Corporate Trust Office" means the principal office of the Trustee at
which at any time its corporate trust business shall be administered, which
office at the date hereof is located at 0 Xxxxxx xx Xxxxxxxxx, Xxxxxx XX 00000,
Attention: Corporate Trust Administration, or such other address as the Trustee
may designate from time to time by notice to the Holders and the Company, or the
principal corporate trust office of any successor Trustee (or such other address
as a successor Trustee may designate from time to time by notice to the Holders
and the Company).
"Debt Securities Guarantor" means Tyco or any Subsidiary that executes
a guarantee of the Debt Securities contemplated by Section 3.1 of the
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Indenture dated as of June 9, 1998 by and among the Company, Tyco and The Bank
of New York.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Global Securities" means Securities that are in the form of the
Securities attached hereto as Exhibit A-1, and to the extent that such
Securities are required to bear the Legend required by Section 2.6, such
Securities will be in the form of a 144A Global Security.
"Guarantee" means any of the unconditional and unsubordinated
guarantees by the Guarantor of the due and punctual payment of principal of and
premium, if any, on the Securities and certain other obligations of the Company
pursuant to this Indenture when and as the same shall become due and payable,
whether at the stated maturity, by acceleration, call for redemption, upon a
repur chase date or otherwise in accordance with the terms of the Securities and
this Indenture.
"Guarantor" means Tyco until a successor replaces such party pursuant
to Article V of this Indenture and, thereafter, shall mean such successor.
"Holder" or "Securityholder" means a person in whose name a Security
is registered on the Registrar's books.
"Indebtedness" means, without duplication, the principal or face
amount of (i) all obligations for borrowed money, (ii) all obligations evidenced
by debentures, notes or other similar instruments, (iii) all obligations in
respect of letters of credit or bankers acceptances or similar instruments (or
reimbursement obligations with respect thereto), (iv) all obligations to pay the
deferred purchase price of property or services, except trade accounts payable
arising in the ordinary course of business, (v) all obligations as lessee which
are capitalized in accordance with generally accepted accounting principles, and
(vi) all Indebtedness of others guaranteed by the Company or any of its
Subsidiaries or for which the Company or any of its Subsidiaries is legally
responsible or liable (whether by agreement to purchase indebtedness of, or to
supply funds or to invest in, others).
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof, including the provisions of the TIA
that are deemed to be a part hereof.
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"Issue Date" of any Security means the date on which the Security was
originally issued or deemed issued as set forth on the face of the Security.
"Issue Price" of any Security means, in connection with the original
issuance of such Security, the initial issue price at which the Security is sold
as set forth on the face of the Security.
"Non-Recourse Indebtedness" means Indebtedness upon the enforcement
of which recourse may be had by the holder(s) thereof only to identified assets
of the Company, Tyco or any Subsidiary and not to the Company, Tyco or any
Subsidiary personally.
"Officer" means the Chairman of the Board, the Vice Chairman, the
Chief Executive Officer, the President, any Executive Vice President, any Senior
Vice President, any Vice President, the Treasurer or the Secretary, any
Assistant Treasurer or Assistant Secretary or any Managing Director or Director
of the Com pany or the Guarantor, as the case may be.
"Officers' Certificate" means a written certificate containing the
information specified in Sections 12.4 and 12.5, signed in the name of the
Company or the Guarantor, as the case may be, by any two Officers, and delivered
to the Trustee. An Officers' Certificate given pursuant to Section 4.3 shall be
signed by an authorized financial or accounting Officer of the Company or the
Guarantor, as the case may be, but need not contain the information specified in
Sections 12.4 and 12.5.
"Opinion of Counsel" means a written opinion containing the
information specified in Sections 12.4 and 12.5, from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of, or counsel to, the
Company, the Guarantor or the Trustee.
"Original Issue Discount" of any Security means the difference between
the Issue Price and the Principal Amount at Maturity of the Security as set
forth on the face of the Security.
"Person" or "person" means any individual, corporation, limited
liability company, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, or government or any agency or political
subdivision thereof.
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"Principal Amount at Maturity" of a Security means the Principal
Amount at Maturity as set forth on the face of the Security.
"Redemption Date" or "redemption date" shall mean the date specified
for redemption of the Securities in accordance with the terms of the Securities
and this Indenture.
"Redemption Price" or "redemption price" shall have the meaning set
forth in paragraph 5 of the Securities.
"Responsible Officer" shall mean, when used with respect to the
Trustee, any officer within the corporate trust department of the Trustee,
including any vice president, assistant vice president, assistant secretary,
assistant treasurer, trust officer or any other officer of the Trustee who
customarily performs functions similar to those performed by the Persons who at
the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such person's knowledge of and familiarity with
the particular subject and who shall have direct responsibility for the
administration of this Indenture.
"Restricted Security" means a Security required to bear the
restrictive legend set forth in the form of Security set forth in Exhibits A-1
and A-2 of this Indenture.
"Rule 144A" means Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.
"SEC" means the Securities and Exchange Commission.
"Securities" means any of the Company's Zero Coupon Convertible
Debentures due February 12, 2021, as amended or supplemented from time to time,
issued under this Indenture.
"Securityholder" or "Holder" means a person in whose name a Security
is registered on the Registrar's books.
"Significant Subsidiary Guarantor" means any one or more Debt
Securities Guarantors (other than Tyco) which, at the date of determination,
together with its or their respective Subsidiaries in the aggregate (i) for the
most recently completed fiscal year of the Company accounted for more than 10%
of the consolidated revenues of the Company or (ii) at the end of such fiscal
year, was the owner
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(beneficial or otherwise) of more than 10% of the consolidated assets of the
Company, as determined in accordance with generally accepted accounting
principles and reflected on the Company's consolidated financial statements.
"Stated Maturity", when used with respect to any Security, means the
date specified in such Security as the fixed date on which an amount equal to
the Principal Amount at Maturity of such Security is due and payable.
"Subsidiary" means any person of which at least a majority of the
outstanding Voting Stock shall at the time directly or indirectly be owned or
controlled by, (i) with respect to the Company, the Company or by one or more
Subsidiaries or by the Company and one or more Subsidiaries, and (ii) with
respect to Tyco, Tyco or by one or more Subsidiaries or by Tyco and one or more
Subsidiaries,
"TIA" means the Trust Indenture Act of 1939 as in effect on the date
of this Indenture, provided, however, that in the event the TIA is amended after
such date, TIA means, to the extent required by any such amendment, the TIA as
so amended.
"trading day" means a day during which trading in securities generally
occurs on the New York Stock Exchange or, if the Common Shares are not listed on
the New York Stock Exchange, on the principal other national or regional
securities exchange on which the Common Shares are then listed or, if the Common
Shares are not listed on a national or regional securities exchange, on the
National Association of Securities Dealers Automated Quotation System or, if the
Common Shares are not quoted on the National Association of Securities Dealers
Automated Quotation System, on the principal other market on which the Common
Shares are then traded.
"Trustee" means the party named as the "Trustee" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"Tyco" means the party named as "Tyco" in the first paragraph of this
Indenture until a successor replaces it pursuant to the applicable provisions of
this Indenture and, thereafter, shall mean such successor. The foregoing
sentence shall likewise apply to any subsequent such successor or successors.
"Voting Stock" of a person means Capital Stock of such person of the
class or classes pursuant to which the holders thereof have the general voting
power under ordinary circumstances to elect at least a majority of the board of
directors,
6
managers or trustees of such person (irrespective of whether or not at the time
Capital Stock of any other class or classes shall have or might have voting
power by reason of the happening of any contingency).
Section 1.2 Other Definitions.
Term Section: Defined in:
"Additional Amounts"......................... 4.8
"Agent Members".............................. 2.12(e)
"Associate".................................. 3.9(a)
"Average Sale Price"......................... 10.7
"beneficial owner"........................... 3.9(a)
"cash"....................................... 3.8(b)
"Change in Control".......................... 3.9(a)
"Change in Control Purchase Date"............ 3.9(a)
"Change in Control Purchase Notice".......... 3.9(a)
"Change in Control Purchase Price"........... 3.9(a)
"Company Notice"............................. 3.8(e)
"Company Notice Date"........................ 3.8(c)
"Conversion Agent"........................... 2.3
"Conversion Date"............................ 10.2
"Conversion Rate"............................ 10.1
"Depositary"................................. 2.1(a)
"Event of Default"........................... 6.1
"Exchange Act"............................... 3.8(d)
"Exchange Party"............................. 10.2
"Ex-Dividend Time"........................... 10.1
"Extraordinary Cash Dividend"................ 10.8
"Legal Holiday".............................. 12.8
"Legend"..................................... 2.6(f)
"Market Price"............................... 3.8(d)
"Notice of Default".......................... 6.1
"Paying Agent"............................... 2.3
"Purchase Date".............................. 3.8(a)
"Purchase Notice"............................ 3.8(a)
"Purchase Price"............................. 3.8(a)
"QIB"........................................ 2.1(a)
"Registrar".................................. 2.3
"Rule 144A Information"...................... 4.6
"Sale Price"................................. 3.8(d)
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"Securities Act" ............................ 3.8(d)
"Spinoff".................................... 10.8
"Taxes"...................................... 4.8
"Taxing Authority"........................... 3.15
"Time of Determination"...................... 10.1
Section 1.3 Incorporation by Reference of Trust Indenture Act.
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Whenever this Indenture refers to a provision of the TIA, the provision is
incorpo rated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by a TIA reference to another statute or defined by an SEC rule
have the meanings assigned to them by such definitions.
Section 1.4 Rules of Construction. Unless the context otherwise
----------------------
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with generally accepted accounting principles as in effect
from time to time;
(3) "or" is not exclusive;
(4) "including" means including, without limitation; and
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(5) words in the singular include the plural, and words in the plural
include the singular.
Section 1.5 Acts of Holders.
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(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instru ments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of Holders signing such
instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agent shall be sufficient for any purpose of this
Indenture and conclusive in favor of the Trustee and the Company, if made in the
manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to such officer the execution thereof.
Where such execution is by a signer acting in a capacity other than such
signer's individual capacity, such certificate or affidavit shall also
constitute sufficient proof of such signer's authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient.
(c) The ownership of Registered Securities shall be proved by the
Register.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee, the
Company or the Guarantor in reliance thereon, whether or not notation of such
action is made upon such Security.
(e) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company
9
may, at its option, by or pursuant to a Board Resolution, fix in advance a
record date for the determination of Holders entitled to give such request,
demand, authorization, direction, notice, consent, waiver or other Act, but the
Company shall have no obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver or other Act
may be given before or after such record date, but only the Holders of record at
the close of business on such record date shall be deemed to be Holders for the
purposes of determining whether Holders of the requisite proportion of
outstanding Securities have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other Act, and for
that purpose the outstanding Securities shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after the
record date.
ARTICLE II
THE SECURITIES
Section 2.1 Form and Dating. The Securities, the Guarantees and the
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Trustee's certificate of authentication shall be substantially in the forms set
forth on Exhibits A-1 and A-2, which are a part of this Indenture. The
Securities may have notations, legends or endorsements required by law, stock
exchange rule or usage (provided that any such notation, legend or endorsement
required by usage is in a form acceptable to the Company). The Company shall
provide any such notations, legends or endorsements to the Trustee in writing.
Each Security shall be dated the date of its authentication.
(a) 144A Global Securities. Securities offered and sold within the
United States to qualified institutional buyers as defined in Rule 144A ("QIBs")
in reliance on Rule 144A shall be issued, initially in the form of a 144A Global
Secu rity, which shall be deposited with the Trustee at its Corporate Trust
Office, as custodian for the Depositary and registered in the name of The
Depository Trust Company ("DTC") or the nominee thereof (such depositary, or any
successor thereto, and any such nominee being hereinafter referred to as the
"Depositary"), duly executed by the Company, endorsed by the Guarantor and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the 144A Global Securities may from time to time be increased or
decreased by adjustments made on the records of the Trustee and the Depositary
as hereinafter provided.
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(b) Global Securities in General. Each Global Security shall
represent such of the outstanding Securities as shall be specified therein and
each shall provide that it shall represent the aggregate amount of outstanding
Securities from time to time endorsed thereon and that the aggregate amount of
outstanding Securities represented thereby may from time to time be reduced or
increased, as appropriate, to reflect exchanges, redemptions and conversions.
Any adjustment of the aggregate principal amount of a Global Security
to reflect the amount of any increase or decrease in the amount of outstand ing
Securities represented thereby shall be made by the Trustee in accordance with
instructions given by the Holder thereof as required by Section 2.12 hereof and
shall be made on the records of the Trustee and the Depositary.
(c) Book-Entry Provisions. The Company shall execute, the Guarantor
shall endorse and the Trustee shall, in accordance with this Section 2.1(c),
authenticate and deliver initially one or more Global Securities that (a) shall
be registered in the name of the Depositary, (b) shall be delivered by the
Trustee to the Depositary or pursuant to the Depositary's instructions and (c)
shall bear legends substantially to the following effect:
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO TYCO INTERNATIONAL GROUP S.A. (THE "COMPANY") OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS TO NOMINEES OF
THE DEPOSITORY TRUST COMPANY OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIM ITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE TWO OF
THE INDENTURE REFERRED TO ON THE REVERSE HEREOF."
Section 2.2 Execution and Authentication. The Securities (with
----------------------------
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Guarantees endorsed thereon) shall be executed on behalf of the Company by any
Officer, under its corporate seal reproduced thereon. The signature of the
officer of the Company on the Securities, and the signature of the officer of
the Guarantor on the Guarantees, may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at the time of the execution of the Securities the proper Officers of
the Company shall bind the Company, notwithstanding that such individuals or any
of them have ceased to hold such offices prior to the authentication and
delivery of such Securities or did not hold such offices at the date of
authentication of such Securities.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein duly
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
The Trustee shall authenticate and deliver Securities for original
issue in an aggregate Principal Amount at Maturity of up to $3,490,250,000 upon
a Company Order without any further action by the Company. The aggregate
Principal Amount at Maturity of Securities outstanding at any time may not
exceed the amount set forth in the foregoing sentence, except as provided in
Section 2.7.
The Securities shall be issued only in registered form without coupons
and only in denominations of $1,000 of Principal Amount at Maturity and any
integral multiple thereof.
Section 2.3 Registrar, Paying Agent and Conversion Agent. The
--------------------------------------------
Company shall maintain an office or agency where Securities may be presented for
registration of transfer or for exchange ("Registrar"), an office or agency
where Securities may be presented for purchase or payment ("Paying Agent") and
an office or agency where Securities may be presented for conversion
("Conversion Agent"). The Registrar shall keep a register of the Securities and
of their transfer and exchange. The Company may have one or more co-registrars,
one or more additional paying agents and one or more additional conversion
agents. The term Paying Agent includes any additional paying agent, including
any named pursuant to Section 4.5. The term Conversion Agent includes any
additional conversion agent, including any named pursuant to Section 4.5.
The Company shall enter into an appropriate agency agreement with
12
any Registrar, Paying Agent, Conversion Agent or co-registrar (other than the
Trustee). The agreement shall implement the provisions of this Indenture that
relate to such agent. The Company shall notify the Trustee of the name and
address of any such agent. If the Company fails to maintain a Registrar, Paying
Agent or Conver sion Agent, the Trustee shall act as such and shall be entitled
to appropriate compen sation therefor pursuant to Section 7.7. The Company or
any Subsidiary or an Affiliate of either of them may act as Paying Agent,
Registrar, Conversion Agent or co-registrar.
The Company initially appoints the Trustee as Registrar, Conversion
Agent and Paying Agent in connection with the Securities.
Section 2.4 Paying Agent to Hold Money and Securities in Trust.
--------------------------------------------------
Except as otherwise provided herein, on or prior to each due date of payments in
respect of any Security, the Company shall deposit with the Paying Agent a sum
of money (in immediately available funds if deposited on the due date) or Common
Shares sufficient to make such payments when so becoming due. The Company shall
require each Paying Agent (other than the Trustee) to agree in writing that the
Paying Agent shall hold in trust for the benefit of Securityholders or the
Trustee all money and Common Shares held by the Paying Agent for the making of
payments in respect of the Securities and shall notify the Trustee of any
default by the Company in making any such payment. At any time during the
continuance of any such default, the Paying Agent shall, upon the written
request of the Trustee, forthwith pay to the Trustee all money and Common Shares
so held in trust. If the Company, a Subsidiary or an Affiliate of either of
them acts as Paying Agent, it shall segregate the money and Common Shares held
by it as Paying Agent and hold it as a separate trust fund. The Company at any
time may require a Paying Agent to pay all money and Common Shares held by it to
the Trustee and to account for any funds and Common Shares disbursed by it.
Upon doing so, the Paying Agent shall have no further liability for the money or
Common Shares.
Section 2.5 Securityholder Lists. The Trustee shall preserve in as
--------------------
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall cause to be furnished to the Trustee at least
semiannually on May 1 and November 1 a listing of Securityholders dated within
15 days of the date on which the list is furnished and at such other times as
the Trustee may request in writing a list in such form and as of such date as
the Trustee may reasonably require of the names and addresses of
Securityholders.
Section 2.6 Transfer and Exchange. Subject to Section 2.12 hereof,
---------------------
(a) upon surrender for registration of transfer of any Security, together with
a
13
written instrument of transfer satisfactory to the Registrar duly executed by
the Securityholder or such Securityholder's attorney duly authorized in writing,
at the office or agency of the Company designated as Registrar or co-registrar
pursuant to Section 2.3, the Company shall execute, the Guarantor shall endorse
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of any authorized
denomination or denominations, of a like aggregate Principal Amount at Maturity.
The Company shall not charge a service charge for any registration of transfer
or exchange, but the Company may require payment of a sum sufficient to pay all
taxes, assessments or other govern mental charges that may be imposed in
connection with the transfer or exchange of the Securities from the
Securityholder requesting such transfer or exchange.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination or denominations, of a like aggregate
Principal Amount at Maturity, upon surrender of the Securities to be exchanged,
together with a written instrument of transfer satisfactory to the Registrar
duly executed by the Securityholder or such Securityholder's attorney duly
authorized in writing, at such office or agency. Whenever any Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the exchange is
entitled to receive.
The Company shall not be required to make, and the Registrar need not
register, transfers or exchanges of Securities selected for redemption (except,
in the case of Securities to be redeemed in part, the portion thereof not to be
redeemed) or any Securities in respect of which a Purchase Notice or Change in
Control Purchase Notice has been given and not withdrawn by the Holder thereof
in accor dance with the terms of this Indenture (except, in the case of
Securities to be pur chased in part, the portion thereof not to be purchased) or
any Securities for a period of 15 days before the mailing of a notice of
redemption of Securities to be redeemed.
(b) Notwithstanding any provision to the contrary herein, so long as a
Global Security remains outstanding and is held by or on behalf of the
Depositary, transfers of a Global Security, in whole or in part, shall be made
only in accordance with Section 2.12 and this Section 2.6(b). Transfers of a
Global Security shall be limited to transfers of such Global Security in whole,
or in part, to nominees of the Depositary or to a successor of the Depositary or
such successor's nominee.
(c) Successive registrations and registrations of transfers and
exchanges as aforesaid may be made from time to time as desired, and each such
registration shall be noted on the register for the Securities.
14
(d) Any Registrar appointed pursuant to Section 2.3 hereof shall
provide to the Trustee such information as the Trustee may reasonably require in
connection with the delivery by such Registrar of Securities upon transfer or
exchange of Securities.
(e) No Registrar shall be required to make registrations of transfer
or exchange of Securities during any periods designated in the text of the
Securities or in this Indenture as periods during which such registration of
transfers and exchanges need not be made.
(f) If Securities (with Guarantees endorsed thereon) are issued upon
the transfer, exchange or replacement of Securities subject to restrictions on
transfer and bearing the legends set forth on the forms of Securities attached
hereto as Exhibits A-1 and A-2 setting forth such restrictions (collectively,
the "Legend"), or if a request is made to remove the Legend on a Security, the
Securities so issued shall bear the Legend, or the Legend shall not be removed,
as the case may be, unless there is delivered to the Company and the Registrar
such satisfactory evidence, which shall include an Opinion of Counsel, as may be
reasonably required by the Company and the Registrar, that neither the Legend
nor the restrictions on transfer set forth therein are required to ensure that
transfers thereof comply with the provisions of Rule 144A or Rule 144 under the
Securities Act or that such Securities are not "restricted" within the meaning
of Rule 144 under the Securities Act. Upon (i) provision of such satisfactory
evidence, or (ii) notification by the Company to the Trustee and registrar of
the sale of such Security pursuant to a registration statement that is effective
at the time of such sale, the Trustee, at the written direction of the Company,
shall authenticate and deliver a Security (with a Guarantee endorsed thereon)
that does not bear the Legend. If the Legend is removed from the face of a
Security and the Security is subsequently held by an Affiliate of the Company,
the Legend shall be reinstated.
Section 2.7 Replacement Securities. If (a) any mutilated Security
----------------------
is surrendered to the Trustee, or (b) the Company, the Guarantor and the Trustee
receive evidence to their satisfaction of the destruction, loss or theft of any
Security, and there is delivered to the Company, the Guarantor and the Trustee
such security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Company, the Guarantor or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute, the Guarantor shall endorse and upon the Company's
written request the Trustee shall authenticate and deliver, in exchange for any
such mutilated Security or in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and Principal Amount at Maturity, bearing
a number not contemporaneously outstanding.
15
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, or is about to be purchased by the
Company pursuant to Article 3 hereof, the Company in its discretion may, instead
of issuing a new Security, pay or purchase such Security, as the case may be.
Upon the issuance of any new Securities under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee and the Guarantor)
connected therewith.
Every new Security issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all benefits of this Indenture equally and proportionately with any
and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
Section 2.8 Outstanding Securities; Determinations of Holders'
--------------------------------------------------
Action. Securities outstanding at any time are all the Securities authenticated
------
by the Trustee except for those cancelled by it, those paid pursuant to Section
2.7 delivered to it for cancellation and those described in this Section 2.8 as
not outstanding. A Security does not cease to be outstanding because the
Company or an Affiliate thereof holds the Security; provided, however, that in
determining whether the Holders of the requisite Principal Amount at Maturity of
Securities have given or concurred in any request, demand, authorization,
direction, notice, consent or waiver hereunder, Securities owned by the Company
or any other obligor upon the Securi ties or any Affiliate of the Company or
such other obligor shall be disregarded and deemed not to be outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Securities which a Responsible Officer of the Trustee actually knows to be so
owned shall be so disregarded. Subject to the foregoing, only Securities
outstanding at the time of such determination shall be considered in any such
determination (including, without limitation, determinations pursuant to
Articles 6 and 9).
If a Security is replaced pursuant to Section 2.7, it ceases to be
16
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture, on a
Redemption Date, or on the Business Day following the Purchase Date or a Change
in Control Purchase Date, or on Stated Maturity, money or securities, if
permitted hereunder, sufficient to pay Securities payable on that date, then
immediately after such Redemption Date, Purchase Date, Change in Control
Purchase Date or Stated Maturity, as the case may be, such Securities shall
cease to be outstanding and Original Issue Discount and interest, if any, on
such Securities shall cease to accrue; provided, that if such Securities are to
be redeemed, notice of such redemption has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been made.
If a Security is converted in accordance with Article 10, then from
and after the time of conversion on the Conversion Date, such Security shall
cease to be outstanding and Original Issue Discount and interest, if any, shall
cease to accrue on such Security.
Section 2.9 Temporary Securities. Pending the preparation of
--------------------
definitive Securities, the Company may execute, the Guarantor shall endorse and
upon Company Order the Trustee shall authenticate and deliver, temporary
Securities which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as conclusively evidenced by
their execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Company designated for such purpose pursuant to Section 2.3,
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities the Company shall execute, the Guarantor shall endorse and
the Trustee shall authenti cate and deliver in exchange therefor a like
Principal Amount at Maturity of defini tive Securities of authorized
denominations. Until so exchanged the temporary Securities shall in all
respects be entitled to the same benefits under this Indenture as definitive
Securities.
Section 2.10 Cancellation. All Securities surrendered for payment,
------------
17
purchase by the Company pursuant to Article 3, conversion, redemption or
registration of transfer or exchange (other than Securities exchanged pursuant
to Section 10.2) shall, if surrendered to any person other than the Trustee, be
delivered to the Trustee and shall be promptly cancelled by it. The Company may
at any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Securities so delivered shall be promptly cancelled
by the Trustee. The Company may not issue new Securities to replace Securities
it has paid or delivered to the Trustee for cancellation or that any Holder has
converted pursuant to Article 10. No Securities shall be authenticated in lieu
of or in exchange for any Securities cancelled as provided in this Section,
except as expressly permitted by this Indenture. All cancelled Securities held
by the Trustee shall be disposed of by the Trustee in accordance with the
Trustee's customary procedure.
Section 2.11 Persons Deemed Owners. Prior to due presentment of a
---------------------
Security for registration of transfer, the Company, the Guarantor, the Trustee
and any agent of the Company, the Guarantor or the Trustee may treat the Person
in whose name such Security is registered as the owner of such Security for the
purpose of receiving payment of principal of the Security or the payment of any
Redemption Price, Purchase Price or Change in Control Purchase Price in respect
thereof, and interest thereon, for the purpose of conversion and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Company, the Guarantor, the Trustee nor any agent of the Company, the Guarantor
or the Trustee shall be affected by notice to the contrary.
Section 2.12 Global Securities.
-----------------
(a) A Global Security may not be transferred, in whole or in part, to
any Person other than the Depositary or a nominee or any successor thereof, and
no such transfer to any such other Person may be registered; provided that the
foregoing shall not prohibit any transfer of a Security that is issued in
exchange for a Global Security but is not itself a Global Security. No transfer
of a Security to any Person shall be effective under this Indenture or the
Securities unless and until such Security has been registered in the name of
such Person. Notwithstanding any other provisions of this Indenture or the
Securities, transfers of a Global Security, in whole or in part, shall be made
only in accordance with Section 2.6 and this Section 2.12.
(b) Subject to the succeeding paragraph, every Security shall be
subject to the restrictions on transfer provided in the Legend including the
delivery of an opinion of counsel, if so provided. Whenever any Restricted
Security is presented or surrendered for registration of transfer or for
exchange for a Security registered in
18
a name other than that of the Holder, such Security must be accompanied by a
certificate in substantially the form set forth in Exhibit B, dated the date of
such surrender and signed by the Holder of such Security, as to compliance with
such restrictions on transfer. The Registrar shall not be required to accept for
such registration of transfer or exchange any Security not so accompanied by a
properly completed certificate.
(c) The restrictions imposed by the Legend upon the transferability
of any Security shall cease and terminate when such Security has been sold
pursuant to an effective registration statement under the Securities Act or
transferred in compliance with Rule 144 under the Securities Act (or any
successor provision thereto) or, if earlier, upon the expiration of the holding
period applicable to sales thereof under Rule 144(k) under the Securities Act
(or any successor provision). Any Security as to which such restrictions on
transfer shall have expired in accordance with their terms or shall have
terminated may, upon a surrender of such Security for exchange to the Registrar
in accordance with the provisions of this Section 2.12 (accompanied, in the
event that such restrictions on transfer have terminated by reason of a transfer
in compliance with Rule 144 or any successor provision, by an opinion of counsel
having substantial experience in practice under the Securities Act and otherwise
reasonably acceptable to the Company, addressed to the Company and in form
acceptable to the Company, to the effect that the transfer of such Security has
been made in compliance with Rule 144 or such successor provision), be exchanged
for a new Security, of like tenor and aggregate Principal Amount at Maturity,
which shall not bear the restrictive Legend. The Company shall inform the
Trustee of the effective date of any registration statement registering the
Securities under the Securities Act. The Trustee shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
aforementioned opinion of counsel or registration statement.
(d) As used in the preceding two paragraphs of this Section 2.12, the
term "transfer" encompasses any sale, pledge, transfer, hypothecation or other
disposition of any Security.
(e) The provisions of clauses (1), (2), (3) and (4) below shall apply
only to Global Securities:
(1) Notwithstanding any other provisions of this Indenture or the
Securities, a Global Security shall not be exchanged in whole or
in part for a Security registered in the name of any Person other
than the Depositary or one or more nominees thereof, provided
that a Global Security may be exchanged for Securi-
19
ties registered in the names of any person designated by the
Depositary in the event that (i) the Depositary has notified the
Company that it is unwilling or unable to continue as Depositary
for such Global Security or such Depositary has ceased to be a
"clearing agency" registered under the Exchange Act, and a
successor Depositary is not appointed by the Company within 90
days, (ii) the Company has provided the Depositary with written
notice that it has decided to discontinue use of the system of
book-entry transfer through the Depositary or any successor
Depositary or (iii) an Event of Default has occurred and is
continuing with respect to the Securities. Any Global Security
exchanged pursuant to clauses (i) or (ii) above shall be so
exchanged in whole and not in part, and any Global Security
exchanged pursuant to clause (iii) above may be exchanged in
whole or from time to time in part as directed by the Depositary.
Any Security issued in exchange for a Global Security or any
portion thereof shall be a Global Security; provided that any
such Security so issued that is registered in the name of a
Person other than the Depositary or a nominee thereof shall not
be a Global Security.
(2) Securities issued in exchange for a Global Security or any
portion thereof shall be issued in definitive, fully registered
form, without interest coupons, shall have an aggregate Principal
Amount at Maturity equal to that of such Global Security or
portion thereof to be so exchanged, shall be registered in such
names and be in such authorized denominations as the Depositary
shall designate and shall bear the applicable leg ends provided
for herein. Any Global Security to be exchanged in whole shall
be surrendered by the Depositary to the Trustee, as Registrar.
With regard to any Global Security to be exchanged in part,
either such Global Security shall be so surrendered for exchange
or, if the Trustee is acting as custodian for the Depositary or
its nominee with respect to such Global Security, the Principal
Amount at Maturity thereof shall be reduced, by an amount equal
to the portion thereof to be so exchanged, by means of an
appropriate adjustment made on the records of the Trustee. Upon
any such surrender or adjustment, the Trustee shall authenticate
and deliver the Security issuable on such exchange to or upon the
order of the Depositary or an authorized representative thereof.
20
(3) Subject to the provisions of clause (5) below, the registered
Holder may grant proxies and otherwise authorize any Person,
including Agent Members (as defined below) and persons that may
hold interests through Agent Members, to take any action which a
holder is entitled to take under this Indenture or the
Securities.
(4) In the event of the occurrence of any of the events specified in
clause (1) above, the Company will promptly make available to the
Trustee a reasonable supply of Certificated Securities in
definitive, fully registered form, without interest coupons.
(5) Neither any members of, or participants in, the Depositary
(collectively, the "Agent Members") nor any other Persons on
whose behalf Agent Members may act shall have any rights under
this Indenture with respect to any Global Security registered in
the name of the Depositary or any nominee thereof, or under any
such Global Security, and the Depositary or such nominee, as the
case may be, may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner and
holder of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Trustee or any agent of the Company or the Trustee
from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or such nominee, as the
case may be, or impair, as between the Depositary, its Agent
Members and any other person on whose behalf an Agent Member may
act, the operation of customary practices of such Persons
governing the exercise of the rights of a holder of any Security.
Section 2.13 CUSIP Numbers. The Company may issue the Securities
-------------
with one or more "CUSIP" numbers (if then generally in use), and, if so, the
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; provided that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Trustee of any change in the CUSIP numbers.
21
ARTICLE III
REDEMPTION AND PURCHASES
Section 3.1 Right to Redeem; Notices to Trustee. The Company, at
-----------------------------------
its option, may redeem the Securities in accordance with the provisions of
paragraph 5 of the Securities. If the Company elects to redeem Securities
pursuant to paragraph 5 of the Securities, it shall notify the Trustee in
writing of the Redemption Date, the Principal Amount at Maturity of Securities
to be redeemed and the Redemption Price.
The Company shall give the notice to the Trustee provided for in this
Section 3.1 by a Company Order, at least 20 days before the Redemption Date
(unless a shorter notice shall be satisfactory to the Trustee).
Section 3.2 Selection of Securities to Be Redeemed. If less than
--------------------------------------
all the Securities are to be redeemed, unless the procedures of the Depositary
provide otherwise, the Trustee shall select the Securities to be redeemed on a
pro rata basis (so long as such method is not prohibited by the rules of any
stock exchange on which the Securities are then listed). The Trustee shall make
the selection at least 15 days but not more than 60 days before the Redemption
Date from outstanding Securities not previously called for redemption. The
Trustee may select for redemption portions of the Principal Amount at Maturity
of Securities that have denominations larger than $1,000.
Securities and portions of them the Trustee selects shall be in
Principal Amounts at Maturity of $1,000 or an integral multiple of $1,000.
Provisions of this Indenture that apply to Securities called for redemption also
apply to portions of Securities called for redemption. The Trustee shall notify
the Company promptly of the Securities or portions of Securities to be redeemed.
If any Security selected for partial redemption is converted in part
before termination of the conversion right with respect to the portion of the
Security so selected, the converted portion of such Security shall be deemed (so
far as may be) to be the portion selected for redemption. Securities which have
been converted during a selection of Securities to be redeemed may be treated by
the Trustee as outstanding for the purpose of such selection.
Section 3.3 Notice of Redemption. At least 15 days but not more
--------------------
22
than 60 days before a Redemption Date, the Company shall mail a notice of
redemption by first-class mail, postage prepaid, to each Holder of Securities to
be redeemed.
The notice shall identify the Securities to be redeemed and shall
state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the Conversion Rate;
(4) the name and address of the Paying Agent and Conversion
Agent;
(5) that Securities called for redemption may be converted at any
time before the close of business on the date that is two
Business Days prior to the Redemption Date;
(6) that Holders who want to convert Securities must satisfy the
requirements set forth in paragraph 8 of the Securities;
(7) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(8) if fewer than all the outstanding Securities are to be redeemed,
the certificate numbers, if any, and Principal Amounts at
Maturity of the particular Securities to be redeemed;
(9) that, unless the Company defaults in making payment of such
Redemption Price, Original Issue Discount on Securities called
for redemption will cease to accrue on and after the Redemption
Date; and
(10) the CUSIP number of the Securities.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense, provided that the
Company makes such request at least three Business Days prior to the date by
which such notice of redemption must be given to Holders in accordance with this
Section 3.3.
Section 3.4 Effect of Notice of Redemption. Once notice of
------------------------------
23
redemption is given, Securities called for redemption become due and payable on
the Redemption Date and at the Redemption Price stated in the notice except for
Securities which are converted in accordance with the terms of this Indenture.
Upon surrender to the Paying Agent, such Securities shall be paid at the
Redemption Xxxxx stated in the notice.
Section 3.5 Deposit of Redemption Price. Prior to 10:00 a.m. (New
---------------------------
York City time) on the Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company or a Subsidiary or an Affiliate of either of
them is the Paying Agent, shall segregate and hold in trust) money sufficient to
pay the Redemption Price of all Securities to be redeemed on that date other
than Securities or portions of Securities called for redemption which on or
prior thereto have been delivered by the Company to the Trustee for cancellation
or have been converted. The Paying Agent shall as promptly as practicable return
to the Company any money not required for that purpose because of conversion of
Securities pursuant to Article 10. If such money is then held by the Company in
trust and is not required for such purpose it shall be discharged from such
trust.
Section 3.6 Securities Redeemed in Part. Upon surrender of a
---------------------------
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate and deliver to the Holder a new Security in an authorized
denomination equal in Principal Amount at Maturity to the unredeemed portion of
the Security surrendered.
Section 3.7 Conversion Arrangement on Call for Redemption. In
---------------------------------------------
connection with any redemption of Securities, the Company may arrange for the
purchase and conversion of any Securities called for redemption by an agreement
with one or more investment bankers or other purchasers to purchase such
Securities by paying to the Trustee in trust for the Securityholders, on or
prior to 10:00 a.m. (New York City time) on the Redemption Date, an amount that,
together with any amounts deposited with the Trustee by the Company for the
redemption of such Securities, is not less than the Redemption Price of such
Securities. Notwithstanding anything to the contrary contained in this Article
3, the obligation of the Company to pay the Redemption Price of such Securities
shall be deemed to be satisfied and discharged to the extent such amount is so
paid by such purchasers. If such an agreement is entered into, any Securities
not duly surrendered for conversion by the Holders thereof may, at the option of
the Company, be deemed, to the fullest extent permitted by law, acquired by such
purchasers from such Holders and (notwithstanding anything to the contrary
contained in Article 10) surrendered by such purchasers for conversion, all as
of immediately prior to the close of business on the Business Day prior to the
Redemption Date, subject to payment of the above amount as aforesaid. The
Trustee
24
shall hold and pay to the Holders whose Securities are selected for redemption
any such amount paid to it for purchase and conversion in the same manner as it
would moneys deposited with it by the Company for the redemption of Securities.
Without the Trustee's prior written consent, no arrangement between the Company
and such purchasers for the purchase and conversion of any Securities shall
increase or otherwise affect any of the powers, duties, responsibilities or
obligations of the Trustee as set forth in this Indenture, and the Company
agrees to indemnify the Trustee from, and hold it harmless against, any loss,
liability or expense arising out of or in connection with any such arrangement
for the purchase and conversion of any Securities between the Company and such
purchasers, including the costs and expenses incurred by the Trustee in the
defense of any claim or liability arising out of or in connection with the
exercise or performance of any of its powers, duties, responsibilities or
obligations under this Indenture.
Section 3.8 Purchase of Securities at Option of the Holder.
----------------------------------------------
(a) General. Securities shall be purchased by the Company pursuant to
paragraph 6 of the Securities as of February 12, 2003, February 12, 2005,
February 12, 2007, February 12, 2009, and February 12 , 2016 (each, a "Purchase
Date"), at the purchase price set forth below (each, a "Purchase Price", as
applicable):
Purchase Price per $1,000
Purchase Date Principal Amount at Maturity
----------------- ----------------------------
February 12, 2003 $764.15
February 12, 2005 $787.33
February 12, 2007 $811.22
February 12, 2009 $835.83
February 12, 2016 $928.01
Purchases of Securities hereunder shall be made, at the option of the Holder
thereof, upon:
(1) delivery to the Paying Agent by the Holder of a written notice of
purchase (a "Purchase Notice") at any time from the opening of
business on the date that is 20 Business Days prior to a Purchase
Date until the close of business on the fifth Business Day prior
to such Purchase Date stating:
(A) the certificate number of the Security which the Holder will
deliver to be purchased,
25
(B) the portion of the Principal Amount at Maturity of the
Security which the Holder will deliver to be purchased, which
portion must be in principal amounts at maturity of $1,000 or an
integral multiple thereof,
(C) that such Security shall be purchased as of the Purchase Date
pursuant to the terms and conditions specified in paragraph 6 of
the Securities and in this Indenture, and
(D) in the event the Company elects, pursuant to Section 3.8(b),
to pay the Purchase Price to be paid on February 12, 2003, in
whole or in part, in Common Shares but such portion of the
Purchase Price shall ultimately be payable to such Holder
entirely in cash because any of the conditions to payment of the
Purchase Price in Common Shares is not satisfied prior to the
close of business on February 12, 2003, as set forth in Section
3.8(d), whether such Holder elects (i) to withdraw such Purchase
Notice as to some or all of the Securities to which such Purchase
Notice relates (stating the Principal Amount at Maturity and
certificate numbers, if any, of the Securities as to which such
withdrawal shall relate), or (ii) to receive cash in respect of
the entire Purchase Price for all Securities (or portions
thereof) to which such Purchase Notice relates; and
(E) delivery of such Security to the Paying Agent prior to, on or
after the Purchase Date (together with all necessary
endorsements) at the offices of the Paying Agent, such delivery
being a condition to receipt by the Holder of the Purchase Price
therefor; provided, however, that such Purchase Price shall be so
paid pursuant to this Section 3.8 only if the Security so
delivered to the Paying Agent shall conform in all respects to
the description thereof in the related Purchase Notice, as
determined by the Company.
If a Holder, in such Holder's Purchase Notice and in any written
notice of withdrawal delivered by such Holder pursuant to the terms of Section
3.10, fails to indicate such Xxxxxx's choice with respect to the election set
forth in clause (D) of Section 3.8(a)(1), such Holder shall be deemed to have
elected to receive cash in respect of the Purchase Price for all Securities
subject to such Purchase Notice in the
26
circumstances set forth in such clause (D).
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.8, a portion of a Security if the Principal Amount at Maturity of such
portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.8 shall be consummated by the delivery of the consideration to be
received by the Holder promptly following the later of the Purchase Date and the
time of delivery of the Security.
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Purchase Notice contemplated by this Section 3.8(a)
shall have the right to withdraw such Purchase Notice at any time prior to the
close of business on the Purchase Date by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by
it of any Purchase Notice or written notice of withdrawal thereof.
(b) Company's Right to Elect Manner of Payment of Purchase Price for
Payment on February 12, 2003. The Securities to be purchased on February 12,
2003 pursuant to Section 3.8(a) may be paid for, at the election of the Company,
in U.S. legal tender ("cash") or Common Shares, or in any combination of cash
and Common Shares, subject to the conditions set forth in Sections 3.8(c) and
(d). The Company shall designate, in the Company Notice delivered pursuant to
Section 3.8(e), whether the Company will purchase the Securities for cash or
Common Shares, or, if a combination thereof, the percentages of the Purchase
Price of Securities in respect of which it will pay in cash or Common Shares;
provided that the Company will pay cash for fractional interests in Common
Shares. For purposes of determining the existence of potential fractional
interests, all Securities subject to purchase by the Company held by a Holder
shall be considered together (no matter how many separate certificates are to be
presented). Each Holder whose Securities are purchased pursuant to this Section
3.8 shall receive the same percentage of cash or Common Shares in payment of the
Purchase Price for such Securities, except (i) as provided in Section 3.8(d)
with regard to the payment of cash in lieu of fractional shares of Common Shares
and (ii) in the event that the Company is unable to purchase the Securities of a
Holder or Holders for Common Shares because any necessary qualifications or
registrations of the Common Shares under applicable state
27
securities laws cannot be obtained, the Company may purchase the Securities of
such Holder or Holders for cash. The Company may not change its election with
respect to the consideration (or components or percentages of components
thereof) to be paid once the Company has given its Company Notice to
Securityholders except pursuant to this Section 3.8(b) or pursuant to Section
3.8(d) in the event of a failure to satisfy, prior to the close of business on
the Purchase Date, any condition to the payment of the Purchase Price, in whole
or in part, in Common Shares.
At least three Business Days before each Company Notice Date, the
Company shall deliver an Officers' Certificate to the Trustee specifying:
(i) if the Purchase Date is February 12, 2003, the manner of
payment selected by the Company,
(ii) the information required by Section 3.8(e),
(iii) if the Purchase Date is February 12, 2003, if the Company
elects to pay the Purchase Price, or a specified percentage thereof, in
Common Shares, that the conditions to such manner of payment set forth in
Section 3.8(d) have been or will be complied with, and
(iv) whether the Company desires the Trustee to give the Company
Notice required by Section 3.8(e).
(c) Purchase with Cash. On February 12, 2003, at the option of the
Company, the Purchase Price of Securities in respect of which a Purchase Notice
pursuant to Section 3.8(a) has been given, or a specified percentage thereof,
may be paid by the Company with cash equal to the aggregate Purchase Price of
such Securities. The Purchase Price of Securities in respect of which a
Purchase Notice pursuant to Section 3.8(a) has been given shall, for all other
Purchase Dates, be paid in cash. The Company Notice, as provided in Section
3.8(e), shall be sent to Holders (and to beneficial owners as required by
applicable law) not less than 20 Business Days prior to such Purchase Date (the
"Company Notice Date").
(d) Purchase with Common Shares. On February 12, 2003, at the option
of the Company, the Purchase Price of Securities in respect of which a Purchase
Notice pursuant to Section 3.8(a) has been given, or a specified percentage
thereof, may be paid by the Company by the delivery of a number of Common Shares
equal to the quotient obtained by dividing (i) the amount of cash to which the
Securityholders would have been entitled had the Company elected to pay all or
such
28
specified percentage, as the case may be, of the Purchase Price of such
Securities in cash by (ii) the Market Price of a Common Share, subject to the
next succeeding paragraph.
The Company will not deliver a fractional Common Share in payment of
the Purchase Price. Instead the Company will pay cash for the current market
value of the fractional share. The current market value of a fraction of a
share shall be determined by multiplying the Market Price by such fraction and
rounding the product to the nearest whole cent. It is understood that if a
Holder elects to have more than one Security purchased, the number of Common
Shares shall be based on the aggregate amount of Securities to be purchased.
If the Company elects to purchase the Securities by delivery of Common
Shares on February 12, 2003, the Company Notice, as provided in Section 3.8(e),
shall be sent to the Holders (and to beneficial owners as required by applicable
law) not later than the Company Notice Date.
The Company's right to exercise its election to purchase Securities on
February 12, 2003 through the delivery of Common Shares shall be conditioned
upon:
(i) the Company's not having given its Company Notice of an
election to pay entirely in cash and its giving of timely Company Notice of
election to purchase all or a specified percentage of the Securities with
Common Shares as provided herein;
(ii) the registration of such Common Shares under the Securities
Act of 1933, as amended (the "Securities Act"), or the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), in each case, if required;
(iii) any necessary qualification or registration under
applicable state securities laws or the availability of an exemption from
such qualification and registration; and
(iv) the receipt by the Trustee of an Officers' Certificate of
the Company and an Opinion of Counsel each stating that (A) the terms of
the delivery of the Common Shares are in conformity with this Indenture and
(B) the Common Shares to be delivered in payment of the Purchase Price in
respect of Securities have been duly authorized by Tyco and, when delivered
pursuant to the terms of this Indenture in payment of the Purchase Price in
respect of the Securities, will
29
be validly issued, fully paid and non-assessable and, to the best of such
counsel's knowledge, free from preemptive rights, and, in the case of such
Officers' Certificate, stating that the conditions above and the condition
set forth in the second succeeding sentence have been satisfied and, in the
case of such Opinion of Counsel, stating that the conditions above have
been satisfied.
Such Officers' Certificate shall also set forth the number of Common
Shares to be delivered for each $1,000 Principal Amount at Maturity of
Securities and the Sale Price of a Common Share on each trading day during the
period commencing on the first trading day of the period during which the Market
Price is calculated and ending on February 12, 2003. The Company may pay the
Purchase Price (or any portion thereof) in Common Shares only if the information
necessary to calculate the Market Price is published in a daily newspaper of
national circulation. If the foregoing conditions are not satisfied with respect
to a Holder or Holders prior to the close of business on the Purchase Date and
the Company has elected to purchase the Securities pursuant to this Section 3.8
through the delivery of Common Shares, the Company shall pay the entire Purchase
Price of the Securities of such Holder or Holders in cash.
The "Market Price" means the average of the Sale Prices of the Common
Shares for the five trading day period ending on (if the third Business Day
prior to the applicable Purchase Date is a trading day, or if not, then on the
last trading day prior to) the third Business Day prior to the applicable
Purchase Date, appropriately adjusted to take into account the occurrence,
during the period commencing on the first of such trading days during such five
trading day period and ending on such Purchase Date, of any event described in
Section 10.6, 10.7 or 10.8; subject, however, to the conditions set forth in
Sections 10.9 and 10.10.
The "Sale Price" of the Common Shares on any date means the closing
per share sale price (or, if no closing sale price is reported, the average of
the bid and ask prices or, if more than one in either case, the average of the
average bid and average ask prices) on such date as reported in the composite
transactions for the principal United States securities exchange on which the
Common Shares are traded or, if the Common Shares are not listed on a United
States national or regional securities exchange, as reported by the National
Association of Securities Dealers Automated Quotation System or by the National
Quotation Bureau Incorporated. In the absence of such quotations, the Company
shall be entitled to determine the sales price on the basis of such quotations
as it considers appropriate.
Upon determination of the actual number of Common Shares to be
30
delivered in payment for each $1,000 Principal Amount at Maturity of Securities,
the Company will publish such determination on Tyco's Web site on the World Wide
Web.
(e) Notice of Election. In connection with any purchase of Securities
pursuant to paragraph 6 of the Securities, the Company shall give notice to
Holders setting forth information specified in this Section 3.8(e) (the "Company
Notice").
In the event the Company has elected to pay the Purchase Price (or a
specified percentage thereof) with Common Shares on February 12, 2003, the
Company Notice shall:
(1) state that each Holder will receive Common Shares with a Market
Price determined as of a specified date prior to the Purchase
Date equal to such specified percentage of the Purchase Price of
the Securities held by such Holder (except any cash amount to be
paid in lieu of fractional shares);
(2) set forth the method of calculating the Market Price of the
Common Shares; and
(3) state that because the Market Price of Common Shares will be
determined prior to the Purchase Date, Holders will bear the
market risk with respect to the value of the Common Shares to be
received from the date such Market Price is determined to the
Purchase Date.
In any case, each Company Notice shall include a form of Purchase
Notice to be completed by a Securityholder and shall state:
(i) the Purchase Price and the Conversion Rate;
(ii) the name and address of the Paying Agent and the Conversion
Agent;
(iii) that Securities as to which a Purchase Notice has been
given may be converted if they are otherwise convertible only in accordance
with Article 10 hereof and paragraph 8 of the Securities if the applicable
Purchase Notice has been withdrawn in accordance with the terms of this
Indenture;
31
(iv) that Securities must be surrendered to the Paying Agent to
collect payment;
(v) that the Purchase Price for any Security as to which a
Purchase Notice has been given and not withdrawn will be paid promptly
following the later of the Purchase Date and the time of surrender of such
Security as described in subclause (iv) above;
(vi) the procedures the Holder must follow to exercise rights
under Section 3.8 and a brief description of those rights;
(vi) briefly, the conversion rights of the Securities;
(vi) the procedures for withdrawing a Purchase Notice (including,
without limitation, for a conditional withdrawal pursuant to the terms of
Section 3.8(a)(1)(D) or Section 3.10);
(ix) that, unless the Company defaults in making payment on
Securities for which a Purchase Notice has been submitted, Original Issue
Discount on such Securities will cease to accrue on the Purchase Date; and
(x) the CUSIP number of the Securities.
At the Company's request, the Trustee shall give such Company Notice
in the Company's name and at the Company's expense; provided, however, that, in
all cases, the text of such Company Notice shall be prepared by the Company.
(f) Covenants of the Company and Tyco. All shares of Common Shares
delivered upon purchase of the Securities shall be duly authorized, validly
issued, fully paid and nonassessable, and shall be free from preemptive rights
and free of any lien or adverse claim.
The Company and Tyco shall use their best efforts to list or cause to
have quoted any Common Shares to be delivered to purchase Securities on each
national securities exchange or over-the-counter or other domestic market on
which the Common Shares are then listed or quoted.
(g) Procedure upon Purchase. The Company shall deposit cash (in
32
respect of cash purchases under Section 3.8 or for fractional interests, as
applicable) or Common Shares, or a combination thereof, as applicable, at the
time and in the manner as provided in Section 3.11, sufficient to pay the
aggregate Purchase Price of all Securities to be purchased pursuant to this
Section 3.8. As soon as practicable after the Purchase Date, the Company shall
deliver to each Holder entitled to receive Common Shares through the Paying
Agent, a certificate for the number of full Common Shares deliverable in payment
of the Purchase Price and cash in lieu of any fractional interests. The person
in whose name the certificate for Common Shares is registered shall be treated
as a holder of record of Common Shares on the Business Day following the
Purchase Date. Subject to Section 3.8(d), no payment or adjustment will be made
for dividends on the Common Shares the record date for which occurred on or
prior to the Purchase Date.
(h) Taxes. If a Holder of a Security purchased on February 12, 2003
is paid in Common Shares, the Company shall pay any documentary, stamp or
similar issue or transfer tax due on such issue of Common Shares. However, the
Holder shall pay any such tax which is due because the Holder requests the
Common Shares to be issued in a name other than the Holder's name. The Paying
Agent may refuse to deliver the certificates representing the Common Shares in a
name other than the Holder's name until the Paying Agent receives a sum
sufficient to pay any tax which will be due because the Common Shares are to be
delivered in a name other than the Holder's name. Nothing herein shall preclude
any income tax withholding required by law or regulations.
Section 3.9 Purchase of Securities at Option of the Holder upon
---------------------------------------------------
Change in Control.
-----------------
(a) If on or prior to February 12, 2009 there shall have occurred a
Change in Control, Securities shall be purchased by the Company, at the option
of the Holder thereof, at a purchase price specified in paragraph 6 of the
Securities (the "Change in Control Purchase Price"), as of the date that is 35
Business Days after the occurrence of the Change in Control (the "Change in
Control Purchase Date"), subject to satisfaction by or on behalf of the Holder
of the requirements set forth in Section 3.9(c).
A "Change in Control" shall be deemed to have occurred at such time as
either of the following events shall occur:
(i) There shall be consummated any share exchange, consolidation
or merger of Tyco pursuant to which the Common Shares would be converted
into cash, securities or other property,
33
in each case other than a share exchange, consolidation or merger of Tyco
in which the holders of the Common Shares immediately prior to the share
exchange, consolidation or merger have, directly or indirectly, at least a
majority of the total voting power in the aggregate of all classes of
Capital Stock of the continuing or surviving corporation immediately after
the share exchange, consolidation or merger; or
(ii) There is a report filed on Schedule 13D or TO (or any
successor schedule, form or report) pursuant to the Exchange Act,
disclosing that any person (for the purposes of this Section 3.9 only, as
the term "person" is used in Section 13(d)(3) or Section 14(d)(2) of the
Exchange Act) has become the beneficial owner (as the term "beneficial
owner" is defined under Rule 13d-3 or any successor rule or regulation
promulgated under the Exchange Act) of 50% or more of the voting power of
the Common Shares then outstanding; provided, however, that a person shall
not be deemed beneficial owner of, or to own beneficially, (A) any
securities tendered pursuant to a tender or exchange offer made by or on
behalf of such person or any of such person's Affiliates or Associates
until such tendered securities are accepted for purchase or exchange
thereunder, or (B) any securities if such beneficial ownership (1) arises
solely as a result of a revocable proxy delivered in response to a proxy or
consent solicitation made pursuant to the applicable rules and regulations
under the Exchange Act, and (2) is not also then reportable on Schedule 13D
(or any successor schedule) under the Exchange Act.
Notwithstanding the foregoing provisions of this Section 3.9, a Change in
Control shall not be deemed to have occurred by virtue of Tyco, any Subsidiary,
any employee Shares ownership plan or any other employee benefit plan of Tyco or
any Subsidiary, or any person holding Common Shares for or pursuant to the terms
of any such employee benefit plan, filing or becoming obligated to file a report
under or in response to Schedule 13D or Schedule TO (or any successor schedule,
form or report) under the Exchange Act disclosing beneficial ownership by it of
shares of Common Shares, whether in excess of 50% or otherwise.
"Associate" shall have the meaning ascribed to such term in Rule 12b-2
of the General Rules and Regulations under the Exchange Act, as in effect on the
date hereof.
(b) Within 15 Business Days after the occurrence of a Change in
Control, the Company shall mail a written notice of the Change in Control by
first-
34
class mail to the Trustee and to each Holder (and to beneficial owners as
required by applicable law). The notice shall include a form of Change in
Control Purchase Notice to be completed by the Securityholder and shall state:
(1) briefly, the events causing a Change in Control and the date of
such Change in Control;
(2) the date by which the Change in Control Purchase Notice pursuant
to this Section 3.9 must be given;
(3) the Change in Control Purchase Date;
(4) the Change in Control Purchase Price;
(5) the name and address of the Paying Agent and the Conversion
Agent;
(6) the Conversion Rate and any adjustments thereto;
(7) that Securities as to which a Change in Control Purchase Notice
has been given may be converted if they are otherwise convertible
pursuant to Article 10 hereof only if the Change in Control
Purchase Notice has been withdrawn in accordance with the terms
of this Indenture;
(8) that Securities must be surrendered to the Paying Agent to
collect payment;
(9) that the Change in Control Purchase Price for any Security as to
which a Change in Control Purchase Notice has been duly given and
not withdrawn will be paid promptly following the later of the
Change in Control Purchase Date and the time of surrender of such
Security as described in (8);
(10) briefly, the procedures the Holder must follow to exercise rights
under this Section 3.9;
(11) briefly, the conversion rights, if any, of the Securities;
(12) the procedures for withdrawing a Change in Control Purchase
Notice;
35
(13) that, unless the Company defaults in making payment of such
Change in Control Purchase Price, Original Issue Discount on
Securities surrendered for purchase by the Company will cease to
accrue on and after the Change in Control Purchase Date; and
(14) the CUSIP number of the Securities.
(c) A Holder may exercise its rights specified in Section 3.9(a) upon
delivery of a written notice of purchase (a "Change in Control Purchase Notice")
to the Paying Agent at any time prior to the close of business on the fifth
business day prior to the Change in Control Purchase Date, stating:
(1) the certificate number of the Security which the Holder will
deliver to be purchased;
(2) the portion of the Principal Amount at Maturity of the Security
which the Holder will deliver to be purchased, which portion must
be $1,000 or an integral multiple thereof; and
(3) that such Security shall be purchased pursuant to the terms and
conditions specified in paragraph 6 of the Securities.
The delivery of such Security to the Paying Agent prior to, on or
after the Change in Control Purchase Date (together with all necessary
endorsements) at the offices of the Paying Agent shall be a condition to the
receipt by the Holder of the Change in Control Purchase Price therefor;
provided, however, that such Change in Control Purchase Price shall be so paid
pursuant to this Section 3.9 only if the Security so delivered to the Paying
Agent shall conform in all respects to the description thereof set forth in the
related Change in Control Purchase Notice.
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.9, a portion of a Security if the Principal Amount at Maturity of such
portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.9 shall be consummated by the delivery of the consideration to be
received by the Holder promptly following the later of the Change in Control
36
Purchase Date and the time of delivery of the Security to the Paying Agent in
accordance with this Section 3.9.
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Change in Control Purchase Notice contemplated by this
Section 3.9(c) shall have the right to withdraw such Change in Control Purchase
Notice at any time prior to the close of business on the Change in Control
Purchase Date by delivery of a written notice of withdrawal to the Paying Agent
in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by
it of any Change in Control Purchase Notice or written withdrawal thereof.
Section 3.10 Effect of Purchase Notice or Change in Control Purchase
-------------------------------------------------------
Notice. Upon receipt by the Paying Agent of the Purchase Notice or Change in
------
Control Purchase Notice specified in Section 3.8(a) or Section 3.9(c), as
applicable, the Holder of the Security in respect of which such Purchase Notice
or Change in Control Purchase Notice, as the case may be, was given shall
(unless such Purchase Notice or Change in Control Purchase Notice is withdrawn
as specified in the following two paragraphs) thereafter be entitled to receive
solely the Purchase Price or Change in Control Purchase Price, as the case may
be, with respect to such Security. Such Purchase Price or Change in Control
Purchase Price shall be paid to such Holder, subject to receipt of funds and/or
securities by the Paying Agent, promptly following the later of (x) the Purchase
Date or the Change in Control Purchase Date, as the case may be, with respect to
such Security (provided the conditions in Section 3.8(a) or Section 3.9(c), as
applicable, have been satisfied) and (y) the time of delivery of such Security
to the Paying Agent by the Holder thereof in the manner required by Section
3.8(a) or Section 3.9(c), as applicable. Securities in respect of which a
Purchase Notice or Change in Control Purchase Notice, as the case may be, has
been given by the Holder thereof may not be converted pursuant to Article 10
hereof on or after the date of the delivery of such Purchase Notice or Change in
Control Purchase Notice, as the case may be, unless such Purchase Notice or
Change in Control Purchase Notice, as the case may be, has first been validly
withdrawn as specified in the following two paragraphs.
A Purchase Notice or Change in Control Purchase Notice, as the case may be,
may be withdrawn by means of a written notice of withdrawal delivered to the
office of the Paying Agent in accordance with the Purchase Notice or Change in
Control Purchase Notice, as the case may be, at any time prior to the close of
business on the Purchase Date or the Change in Control Purchase Date, as the
case may be, specifying:
37
(1) the certificate number, if any, of the Security in respect of
which such notice of withdrawal is being submitted,
(2) the Principal Amount at Maturity of the Security with respect to
which such notice of withdrawal is being submitted, and
(3) the Principal Amount at Maturity, if any, of such Security which
remains subject to the original Purchase Notice or Change in
Control Purchase Notice, as the case may be, and which has been
or will be delivered for purchase by the Company.
A written notice of withdrawal of a Purchase Notice may be in the form
set forth in the preceding paragraph or may be in the form of (i) a conditional
withdrawal contained in a Purchase Notice pursuant to the terms of Section
3.8(a)(1)(D) or (ii) a conditional withdrawal containing the information set
forth in Section 3.8(a)(1)(D) and the preceding paragraph and contained in a
written notice of withdrawal delivered to the Paying Agent as set forth in the
preceding paragraph.
There shall be no purchase of any Securities pursuant to Section 3.8
or 3.9 if there has occurred (prior to, on or after, as the case may be, the
giving, by the Holders of such Securities, of the required Purchase Notice or
Change in Control Purchase Notice, as the case may be) and is continuing an
Event of Default (other than a default in the payment of the Purchase Price or
Change in Control Purchase Price, as the case may be, with respect to such
Securities). The Paying Agent will promptly return to the respective Holders
thereof any Securities (x) with respect to which a Purchase Notice or Change in
Control Purchase Notice, as the case may be, has been withdrawn in compliance
with this Indenture, or (y) held by it during the continuance of an Event of
Default (other than a default in the payment of the Purchase Price or Change in
Control Purchase Price, as the case may be, with respect to such Securities) in
which case, upon such return, the Purchase Notice or Change in Control Purchase
Notice with respect thereto shall be deemed to have been withdrawn.
Section 3.11 Deposit of Purchase Price or Change in Control Purchase
-------------------------------------------------------
Price. Prior to 10:00 a.m. (local time in the City of New York) on the Business
-----
Day following the Purchase Date or the Change in Control Purchase Date, as the
case may be, the Company shall deposit with the Trustee or with the Paying Agent
(or, if the Company or a Subsidiary or an Affiliate of either of them is acting
as the Paying Agent, shall segregate and hold in trust as provided in Section
2.4) an amount of money (in immediately available funds if deposited on such
Business Day)
38
or Common Shares, if permitted hereunder, sufficient to pay the aggregate
Purchase Price or Change in Control Purchase Price, as the case may be, of all
the Securities or portions thereof which are to be purchased as of the Purchase
Date or Change in Control Purchase Date, as the case may be.
Section 3.12 Securities Purchased in Part. Any Certificated
----------------------------
Security which is to be purchased only in part shall be surrendered at the
office of the Paying Agent (with, if the Company, the Guarantor or the Trustee
so requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company, the Guarantor and the Trustee duly executed by, the
Holder thereof or such Xxxxxx's attorney duly authorized in writing) and the
Company shall execute, the Guarantor shall endorse and the Trustee shall
authenticate and deliver to the Holder of such Security, without service charge,
a new Security or Securities, of any authorized denomination as requested by
such Holder in aggregate Principal Amount at Maturity equal to, and in exchange
for, the portion of the Principal Amount at Maturity of the Security so
surrendered which is not purchased.
Section 3.13 Covenant to Comply With Securities Laws Upon Purchase
-----------------------------------------------------
of Securities. When complying with the provisions of Section 3.8 or 3.9 hereof
-------------
(provided that such offer or purchase constitutes an "issuer tender offer" for
purposes of Rule 13e-4 (which term, as used herein, includes any successor
provision thereto) under the Exchange Act at the time of such offer or
purchase), the Company shall (i) comply with Rule 13e-4 and Rule 14e-1 under the
Exchange Act, (ii) file the related Schedule TO (or any successor schedule, form
or report) under the Exchange Act, and (iii) otherwise comply with all Federal
and state securities laws so as to permit the rights and obligations under
Sections 3.8 and 3.9 to be exercised in the time and in the manner specified in
Sections 3.8 and 3.9.
Section 3.14 Repayment to the Company. The Trustee and the Paying
------------------------
Agent shall return to the Company any cash or Common Shares that remain
unclaimed as provided in paragraph 12 of the Securities, together with interest
or dividends, if any, thereon (subject to the provisions of Section 7.1(f)),
held by them for the payment of the Purchase Price or Change in Control Purchase
Price, as the case may be; provided, however, that to the extent that the
aggregate amount of cash or Common Shares deposited by the Company pursuant to
Section 3.11 exceeds the aggregate Purchase Price or Change in Control Purchase
Price, as the case may be, of the Securities or portions thereof which the
Company is obligated to purchase as of the Purchase Date or Change in Control
Purchase Date, as the case may be, then, unless otherwise agreed in writing with
the Company, promptly after the Business Day following the Purchase Date or
Change in Control Purchase Date, as the case may be, the Trustee shall return
any such excess to the Company together with
39
interest or dividends, if any, thereon (subject to the provisions of Section
7.1(f)).
Section 3.15 Redemption Upon Changes in Withholding Taxes. The
--------------------------------------------
Securities may be redeemed, as a whole but not in part, at the election of the
Company, upon not less than 30 nor more than 60 days notice (which notice shall
be irrevocable), at a redemption price equal to the Issue Price plus accrued
Original Issue Discount to the redemption date and Additional Amounts, if any,
if as a result of any amendment to, or change in, the laws or regulations of
Luxembourg or Bermuda or any political subdivision or taxing authority thereof
or therein having power to tax (a "Taxing Authority"), or any change in the
application or official interpretation of such laws or regulations which
amendment or change is announced or becomes effective after the date the
Securities are issued, the Company or the Guarantor has become or will become
obligated to pay Additional Amounts, on the next date on which any amount would
be payable with respect to the Securities, and such obligation cannot be avoided
by the use of reasonable measures available to the Company or the Guarantor, as
the case may be; provided, however, that (a) no such notice of redemption may be
given earlier than 60 days prior to the earliest date on which the Company or
the Guarantor, as the case may be, would be obligated to pay such Additional
Amounts, and (b) at the time such notice of redemption is given, such obligation
to pay such Additional Amounts remains in effect. Prior to the giving of any
notice of redemption described in this paragraph, the Company shall deliver to
the Trustee (i) an Officer's Certificate of the Company or the Guarantor, as the
case may be, stating that the obligation to pay Additional Amounts cannot be
avoided by the Company or the Guarantor taking reasonable measures available to
it and (ii) an Opinion of Counsel of recognized standing to the effect that the
Company or the Guarantor, as the case may be, has or will become obligated to
pay Additional Amounts as a result of a change, amendment, official
interpretation or application described above and that the Company or the
Guarantor, as the case may be, cannot avoid the payment of such Additional
Amounts by taking reasonable measures available to it.
ARTICLE IV
COVENANTS
Section 4.1 Payment of Securities. The Company shall promptly make
---------------------
all payments in respect of the Securities on the dates and in the manner
provided in the Securities or pursuant to this Indenture. Any amounts to be
given to the Trustee or Paying Agent, shall be deposited with the Trustee or
Paying Agent by 10:00 a.m. (New York City time) by the Company. Principal
Amount at Maturity, Issue Price plus accrued Original Issue Discount, Redemption
Price, Purchase Price,
40
Change in Control Purchase Price and interest, if any, shall be considered paid
on the applicable date due if on such date (or, in the case of a Purchase Price
or Change in Control Purchase Price, on the Business Day following the
applicable Purchase Date or Change in Control Purchase Date, as the case may be)
the Trustee or the Paying Agent holds, in accordance with this Indenture, money
or securities, if permitted hereunder, sufficient to pay all such amounts then
due.
The Company shall, to the extent permitted by law, pay interest on
overdue amounts at the rate per annum set forth in paragraph 1 of the
Securities, compounded semiannually, which interest shall accrue from the date
such overdue amount was originally due to the date payment of such amount,
including interest thereon, has been made or duly provided for. All such
interest shall be payable on demand. The accrual of such interest on overdue
amounts shall be in addition to the continued accrual of Original Issue
Discount.
Section 4.2 SEC and Other Reports. The Guarantor shall file with
---------------------
the Trustee, within 15 days after it files such annual and quarterly reports,
information, documents and other reports with the SEC, copies of its annual
report and of the information, documents and other reports (or copies of such
portions of any of the foregoing as the SEC may by rules and regulations
prescribe) which the Guarantor is required to file with the SEC pursuant to
Section 13 or 15(d) of the Exchange Act. In the event the Guarantor is at any
time no longer subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act, it shall continue to provide the Trustee with reports
containing substantially the same information as would have been required to be
filed with the SEC had the Guarantor continued to have been subject to such
reporting requirements. In such event, such reports shall be provided at the
times the Guarantor would have been required to provide reports had it continued
to have been subject to such reporting requirements.
In addition, the Company and the Guarantor shall comply with the other
provisions of TIA Section 314(a).
Section 4.3 Compliance Certificate. The Company and the Guarantor
----------------------
shall deliver to the Trustee within 120 days after the end of each fiscal year
of the Company (beginning with the fiscal year ending on September 30, 2001) an
Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof either the Company or the Guarantor is in default in the
performance and observance of any of the terms, provisions and conditions of
this Indenture (without regard to any period of grace or requirement of notice
provided hereunder) and if the Company or the Guarantor shall be in default,
specifying all such defaults and the nature and status thereof of which they may
have knowledge.
41
Section 4.4 Further Instruments and Acts. Upon request of the
----------------------------
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
Section 4.5 Maintenance of Office or Agency. The Company will
-------------------------------
maintain in the Borough of Manhattan, the City of New York, an office or agency
of the Trustee, Registrar, Paying Agent and Conversion Agent where Securities
may be presented or surrendered for payment, where Securities may be surrendered
for registration of transfer, exchange, purchase, redemption or conversion and
where notices and demands to or upon the Company in respect of the Securities
and this Indenture may be served. The office of State Street Bank and Trust
Company, N.A., 00 Xxxxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (Attention:
Xxxxxxx Xxxxxxx), shall initially be such office or agency for all of the
aforesaid purposes. The Company shall give prompt written notice to the Trustee
of the location, and of any change in the location, of any such office or agency
(other than a change in the location of the office of the Trustee). If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 12.2.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York, for such purposes.
Section 4.6 Delivery of Certain Information. At any time when the
-------------------------------
Guarantor is not subject to Section 13 or 15(d) of the Exchange Act, upon the
request of a Holder or any beneficial owner of Securities or holder or
beneficial owner of Common Shares delivered upon conversion thereof, or in
accordance with Section 3.8(c), the Guarantor will promptly furnish or cause to
be furnished Rule 144A Information (as defined below) to such Holder or any
beneficial owner of Securities or holder or beneficial owner of Common Shares,
or to a prospective purchaser of any such security designated by any such
holder, as the case may be, to the extent required to permit compliance by such
Holder or holder with Rule 144A under the Securities Act in connection with the
resale of any such security. "Rule 144A Information" shall be such information
as is specified pursuant to Rule 144A(d)(4) under the Securities Act. Whether a
person is a beneficial owner shall be
42
determined by the Company to the Company's reasonable satisfaction.
Section 4.7 Calculation of Original Issue Discount. The Company
--------------------------------------
shall file with the Trustee no later than the end of each calendar year (i) a
written notice specifying the amount of Original Issue Discount (including daily
rates and accrual periods) accrued on outstanding Securities as of the end of
such year and (ii) such other specific information relating to such Original
Issue Discount as may then be relevant under the Internal Revenue Code of 1986,
as amended from time to time.
Section 4.8 Payment of Additional Amounts. All payments made by
-----------------------------
the Company and the Guarantor under or with respect to the Securities and the
Guarantees will be made free and clear of and without withholding or deduction
for or on account of any present or future taxes, duties, levies, imposts,
assessments or governmental charges of whatever nature imposed or levied by or
on behalf of any Taxing Authority ("Taxes"), unless the Company or the
Guarantor, as the case may be, is required to withhold or deduct Taxes by law or
by the interpretation or administration thereof. In the event that the Company
or the Guarantor is required to so withhold or deduct any amount for or on
account of any Taxes from any payment made under or with respect to the
Securities or the Guarantees, as the case may be, the Company or the Guarantor,
as the case may be, will pay such additional amounts ("Additional Amounts") as
may be necessary so that the net amount received by each Holder of Securities
(including Additional Amounts) after such withholding or deduction will equal
the amount that such Holder would have received if such Taxes had not been
required to be withheld or deducted; provided that no Additional Amounts will be
payable with respect to a payment made to a Holder of Securities to the extent:
(i) that any such Taxes would not have been so imposed but for
the existence of any present or former connection between such Holder and
the Taxing Authority imposing such Taxes (other than the mere receipt of
such payment, acquisition, ownership or disposition of such Securities or
the exercise or enforcement of rights under such Securities, the Guarantees
or this Indenture);
(ii) of any estate, inheritance, gift, sales, transfer, or
personal property Taxes imposed with respect to such Securities, except as
otherwise provided herein;
(iii) that any such Taxes would not have been so imposed but for
the presentation of such Securities or Guarantees (where presentation is
required) for payment on a date more than 30
43
days after the date on which such payment became due and payable or the
date on which payment thereof is duly provided for, whichever is later,
except to the extent that the beneficiary or Holder thereof would have been
entitled to Additional Amounts had the Securities or Guarantees been
presented for payment on any date during such 30-day period; or
(iv) that such Holder would not be liable or subject to such
withholding or deduction of Taxes but for the failure to make a valid
declaration of non-residence or other similar claim for exemp tion, if (x)
the making of such declaration or claim is required or imposed by statute,
treaty, regulation, ruling or administrative practice of the relevant
Taxing Authority as a precondition to an exemption from, or reduction in,
the relevant Taxes, and (y) at least 60 days prior to the first payment
date with respect to which the Company or the Guarantor shall apply this
subclause (iv), the Company or the Guarantor shall have notified all
Holders of Securities in writing that they shall be required to provide
such declaration or claim.
The Company or the Guarantor, as applicable, will also (i) make such
withholding or deduction of Taxes and (ii) remit the full amount of Taxes so de
ducted or withheld to the relevant Taxing Authority in accordance with all
applicable laws. The Company or the Guarantor, as applicable, will use its
reasonable best efforts to obtain certified copies of tax receipts evidencing
the payment of any Taxes so deducted or withheld from each Taxing Authority
imposing such Taxes. The Company or the Guarantor, as the case may be, will,
upon request, make available to the Holders of the Securities, within 60 days
after the date the payment of any Taxes so deducted or withheld is due pursuant
to applicable law, certified copies of tax receipts evidencing such payment by
the Company or the Guarantor or if, notwith standing the Company's or the
Guarantor's efforts to obtain such receipts, the same are not obtainable, other
evidence of such payments by the Company or the Guarantor.
At least 30 days prior to each date on which any payment under or with
respect to the Securities is due and payable, if the Company or the Guarantor
will be obligated to pay Additional Amounts with respect to such payment, the
Company or the Guarantor will deliver to the Trustee an Officers' Certificate
stating the fact that such Additional Amounts will be payable, the amounts so
payable and will set forth such other information as is necessary to enable the
Trustee to pay such Additional Amounts to Holders of Securities on the payment
date.
The foregoing provisions shall survive any termination or discharge of
44
this Indenture and shall apply mutatis mutandis to any jurisdiction in which any
successor Person to the Company or the Guarantor, as the case may be, is
organized or is engaged in business for tax purposes or any political
subdivisions or taxing authority or agency thereof or therein.
In addition, the Company will pay any stamp, issue, registration,
documentary or other similar taxes and duties, including interest, penalties and
Additional Amounts with respect thereto, payable in Luxembourg, Bermuda or the
United States or any political subdivision or taxing authority of or in the
foregoing in respect of the creation, issue, offering, enforcement, redemption
or retirement of the Securities.
Whenever in this Indenture or the Securities there is mentioned, in
any context, the payment of principal, redemption price or any other amount
payable under or with respect to any Security, such mention shall be deemed to
include mention of the payment of Additional Amounts to the extent that, in such
context, Additional Amounts are, were or would be payable in respect thereof.
ARTICLE V
SUCCESSOR CORPORATION
Section 5.1 When Company or Guarantor May Merge or Transfer Assets.
------------------------------------------------------
Neither the Company nor the Guarantor shall consolidate with or merge with or
into any other person or convey, transfer or lease its properties and assets
substantially as an entirety to any person, unless:
(a) either (1) the Company or the Guarantor, as the case may be, shall
be the continuing corporation or (2) the person (if other than the Company or
the Guarantor, as the case may be) formed by such consolidation or into which
the Company or the Guarantor, as the case may be, is merged or the person which
acquires by conveyance, transfer or lease the properties and assets of the
Company or the Guarantor, respectively, substantially as an entirety (i) shall
be organized and validly existing under the laws of (A) the United States or any
State thereof or the District of Columbia, (B) Bermuda or any member country of
the European Union, or (C) if such merger, consolidation or other transaction
would not impair the rights of Securityholders, any other country and (ii) shall
expressly assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, all of the obligations of the
Company under the Securities and this Indenture
45
or the Guarantor under the Guarantees and this Indenture, as the case may be;
(b) immediately after giving effect to such transaction, no Default
shall have occurred and be continuing; and
(c) the Company or the Guarantor, as the case may be, shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger, conveyance, transfer or lease and,
if a supplemental indenture is required in connection with such transaction,
such supplemental indenture, comply with this Article 5 and that all conditions
precedent herein provided for relating to such transaction have been satisfied.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise) of the properties and assets of one or more Subsidiaries
(other than to the Company or the Guarantor, as the case may be, or another
Subsidiary), which, if such assets were owned by the Company or the Guarantor,
as the case may be, would constitute all or substantially all of the properties
and assets of the Company or the Guarantor, respectively, shall be deemed to be
the transfer of all or substantially all of the properties and assets of the
Company or the Guarantor, as the case may be.
The successor person formed by such consolidation or into which the
Company or the Guarantor, as the case may be, is merged or the successor person
to which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company or the
Guarantor, respectively, under this Indenture with the same effect as if such
successor had been named as the Company or the Guarantor, respectively, herein;
and thereafter, except in the case of a lease and obligations the Company or the
Guarantor, as the case may be, may have under a supplemental indenture pursuant
to Section 10.14, the Com pany shall be discharged from all obligations and
covenants under this Indenture and the Securities and the Guarantor shall be
discharged from all obligations and cove nants under this Indenture and the
Guarantees, as the case may be. Subject to Section 9.6, the Company, the
Guarantor, the Trustee and the successor person shall enter into a supplemental
indenture to evidence the succession and substitution of such successor person
and such discharge and release of the Company or the Guarantor, as the case may
be.
46
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.1 Events of Default. An "Event of Default" occurs if:
-----------------
(1) the Company defaults in the payment of the Principal Amount at Matu
rity, Issue Price plus accrued Original Issue Discount, Redemption Price,
Purchase Price or Change in Control Purchase Price on any Security when the same
becomes due and payable at its Stated Maturity, upon redemption, upon
declaration, when due for purchase by the Company or otherwise;
(2) the Company or the Guarantor fails to comply with any of its
agreements in the Securities, this Indenture or the Guarantees (other than those
referred to in clause (1) above) and such failure continues for 90 days after
receipt by the Company or the Guarantor, as the case may be, of a Notice of
Default;
(3) an event of default, as defined in any indenture, including this
Indenture, or instrument evidencing or under which the Company or the Guarantor
on the date any determination shall be made under this clause (3), shall have
outstanding at least $50,000,000 aggregate principal amount of Indebtedness for
borrowed money (other than Non-Recourse Indebtedness), shall happen and be
continuing and such event of default shall involve the failure to pay the
principal of or premium, if any, on such Indebtedness (or any part thereof) on
the final maturity date thereof after the expiration of any applicable grace
period with respect thereto, or such Indebtedness shall have been accelerated so
that the same shall be or become due and payable prior to the date on which the
same would otherwise have become due and payable, and such acceleration shall
not be rescinded or annulled within ten Business Days after notice thereof shall
have been given to the Company or the Guarantor, as the case may be, by the
Trustee (if such event be known to it) or to the Company or the Guarantor, as
the case may be, and the Trustee by the Holders of at least 25% in aggregate
principal amount of all of the Securities at the time outstanding; provided
that, if such event of default under such indenture or instrument shall be
remedied or cured by the Company or the Guarantor, as the case may be, or
waived by the requisite holders of such indebtedness, then the Event of Default
by reason thereof shall be deemed likewise to have been thereupon remedied,
cured or waived without further action upon the part of either the Trustee or
any of the Securityholders, and provided further, however, that subject to the
provisions of Section 7.1 and 7.2, the Trustee shall not be charged with
knowledge of any such event of default unless written notice thereof shall have
been given to the Trustee by the Company or the Guarantor, by the holder or an
agent of the holder of any such Indebtedness, by the trustee then acting under
any indenture
47
or other instrument under which such default shall have occurred, or by the
Holders of not less than 25% in the aggregate principal amount of the Securities
at the time outstanding;
(4) any Guarantee shall for any reason cease to be, or shall for any
reason be asserted in writing by the Guarantor or the Company not to be in full
force and effect and enforceable in accordance with its terms except to the
extent contemplated by this Indenture and such Guarantee;
(5) a court having jurisdiction in the premises shall enter a decree or
order for relief in respect of the Company, Tyco, the Guarantor or any
Significant Subsidiary Guarantor in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
appointing a receiver, liquidator, assignee, custodian, trustee or sequestrator
(or similar official) of the Company, Tyco, the Guarantor or such Significant
Subsidiary Guarantor or for any substantial part of its property or ordering the
winding up or liquidation of its affairs and such decree or order shall remain
unstayed and in effect for a period of 60 consecutive days; or
(6) the Company, Tyco, the Guarantor or any Significant Subsidiary
Guarantor shall commence a voluntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, or consent to the
entry of an order for relief in an involuntary case under any such law, or
consent to the appointment of or taking possession by a receiver, liquidator,
assignee, custodian, trustee or sequestrator (or similar official) of the
Company, Tyco, the Guarantor or such Significant Subsidiary Guarantor or for any
substantial part of its property or make any general assignment for the benefit
of creditors.
A Default under clause (2), (3) or (4) above is not an Event of
Default until the Trustee notifies the Company, or the Holders of at least 25%
in aggregate Principal Amount at Maturity of the Securities at the time
outstanding notify the Company and the Trustee, of the Default and the Company
or the Guarantor, as the case may be, does not cure such Default (and such
Default is not waived) within the time specified in clause (2), (3) or (4) above
after actual receipt of such notice. Any such notice must specify the Default,
demand that it be remedied and state that such notice is a "Notice of Default".
The Company or the Guarantor shall deliver to the Trustee, within 30
days after it becomes aware of the occurrence thereof, written notice of any
event which with the giving of notice or the lapse of time, or both, would
become an Event of Default under clauses (2), (3) or (4) above, its status and
what action the Company or the Guarantor, as the case may be, is taking or
proposes to take with respect
48
thereto.
Section 6.2 Acceleration. If an Event of Default (other than an
------------
Event of Default specified in Section 6.1(5) or (6) occurs and is continuing,
the Trustee by Notice to the Company, or the Holders of at least 25% in
aggregate Principal Amount at Maturity of the Securities at the time outstanding
by notice to the Company and the Trustee, may declare the Issue Price plus
accrued Original Issue Discount through the date of declaration on all the
Securities to be immediately due and payable. Upon such a declaration, such
Issue Price plus accrued Original Issue Discount shall be due and payable
immediately. If an Event of Default specified in Section 6.1(5) or (6) occurs
and is continuing, the Issue Price plus accrued Original Issue Discount on all
the Securities shall become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Securityholders. The
Holders of a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding, by notice to the Trustee (and without notice
to any other Securityholder) may rescind an acceleration and its consequences if
the rescission would not conflict with any judgment or decree and if all
existing Events of Default have been cured or waived except nonpayment of the
Issue Price plus accrued Original Issue Discount that have become due solely as
a result of acceleration and if all amounts due to the Trustee under Section 7.7
have been paid. No such rescission shall affect any subsequent Default or
impair any right consequent thereto.
Section 6.3 Other Remedies. If an Event of Default occurs and is
--------------
continuing, the Trustee may pursue any available remedy to collect the payment
of the Issue Price plus accrued Original Issue Discount on the Securities or to
enforce the performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if the Trustee does not
possess any of the Securities or does not produce any of the Securities in the
proceeding. A delay or omission by the Trustee or any Securityholder in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of, or acquiescence in, the
Event of Default. No remedy is exclusive of any other remedy. All available
remedies are cumulative.
Section 6.4 Waiver of Past Defaults. The Holders of a majority in
-----------------------
aggregate Principal Amount at Maturity of the Securities at the time
outstanding, by notice to the Trustee (and without notice to any other
Securityholder), may waive an existing Default and its consequences except (1)
an Event of Default described in Section 6.1(1), (2) a Default in respect of a
provision that under Section 9.2 cannot be amended without the consent of each
Securityholder affected or (3) a Default which constitutes a failure to convert
any Security in accordance with the terms of
49
Article 10. When a Default is waived, it is deemed cured, but no such waiver
shall extend to any subsequent or other Default or impair any consequent right.
This Section 6.4 shall be in lieu of Section 316(a)1(B) of the TIA and such
Section 316(a)1(B) is hereby expressly excluded from this Indenture, as
permitted by the TIA.
Section 6.5 Control by Majority. The Holders of a majority in
-------------------
aggregate Principal Amount at Maturity of the Securities at the time outstanding
may direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or of exercising any trust or power conferred on
the Trustee. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture or that the Trustee determines in good
faith is unduly prejudicial to the rights of other Securityholders or would
involve the Trustee in personal liability unless the Trustee is offered
indemnity satisfactory to it. This Section 6.5 shall be in lieu of Section
316(a)1(A) of the TIA and such Section 316(a)1(A) is hereby expressly excluded
from this Indenture, as permitted by the TIA.
Section 6.6 Limitation on Suits. A Securityholder may not pursue
-------------------
any remedy with respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice stating that an Event of
Default is continuing;
(2) the Holders of at least 25% in aggregate Principal Amount at Maturity
of the Securities at the time outstanding make a written request to the Trustee
to pursue the remedy;
(3) such Holder or Holders offer to the Trustee security or indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of such notice, request and offer of security or indemnity; and
(5) the Holders of a majority in aggregate Principal Amount at Maturity of
the Securities at the time outstanding do not give the Trustee a direction
inconsistent with the request during such 60-day period.
A Securityholder may not use this Indenture to prejudice the rights of
any other Securityholder or to obtain a preference or priority over any other
Securityholder.
Section 6.7 Rights of Holders to Receive Payment. Notwithstanding
------------------------------------
50
any other provision of this Indenture, the right of any Holder to receive
payment of the Principal Amount at Maturity, Issue Price plus accrued Original
Issue Dis count, Redemption Price, Purchase Price, Change in Control Purchase
Price or interest, if any, in respect of the Securities held by such Holder, on
or after the respective due dates expressed in the Securities or any Redemption
Date, and to convert the Securities in accordance with Article 10, or to bring
suit for the enforce ment of any such payment on or after such respective dates
or the right to convert, shall not be impaired or affected adversely without the
consent of such Holder.
Section 6.8 Collection Suit by Trustee. If an Event of Default
--------------------------
described in Section 6.1(1) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
or the Guarantor for the whole amount owing with respect to the Securities and
the amounts provided for in Section 7.7.
Section 6.9 Trustee May File Proofs of Claim. In case of the
--------------------------------
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company, the Guarantor or any other obligor upon the
Securities or the property of the Company, the Guarantor or of such other
obligor or their creditors, the Trustee (irrespective of whether the Principal
Amount at Maturity, Issue Price plus accrued Original Issue Discount, Redemption
Price, Purchase Price, Change in Control Purchase Price or interest, if any, in
respect of the Securities shall then be due and payable as therein expressed or
by declaration or otherwise and irrespective of whether the Trustee shall have
made any demand on the Company or the Guarantor for the payment of any such
amount) shall be entitled and empowered, by interven tion in such proceeding or
otherwise,
(a) to file and prove a claim for the whole amount of the Principal
Amount at Maturity, Issue Price plus accrued Original Issue Discount, Redemption
Price, Purchase Price, Change in Control Purchase Price, or interest, if any,
and to file such other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel or any other amounts due the Trustee under Section 7.7) and of the
Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar
51
official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.7.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 6.1 Priorities. If the Trustee collects any money pursuant
----------
to this Article 6, it shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.7;
SECOND: to Securityholders for amounts due and unpaid on the Securities for
the Principal Amount at Maturity, Issue Price plus accrued Original Issue
Discount, Redemption Price, Purchase Price, Change in Control Purchase Price or
interest, if any, as the case may be, ratably, without preference or priority of
any kind, according to such amounts due and payable on the Securities; and
THIRD: the balance, if any, to the Company or the Guarantor, as applicable.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section 6.10. At least 15 days before such
record date, the Trustee shall mail to each Securityholder, the Company and, if
applicable, the Guarantor, a notice that states the record date, the payment
date and the amount to be paid.
Section 6.1 Undertaking for Costs. In any suit for the enforcement
---------------------
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant (other than the Trustee) in the suit of
an undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees and expenses,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.7 or a suit by Holders of more than 10% in aggregate Principal
52
Amount at Maturity of the Securities at the time outstanding. This Section 6.11
shall be in lieu of Section 315(e) of the TIA and such Section 315(e) is hereby
expressly excluded from this Indenture, as permitted by the TIA.
Section 6.1 Waiver of Stay, Extension or Usury Laws. Each of the
---------------------------------------
Company and the Guarantor covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law or any
usury or other law wherever enacted, now or at any time hereafter in force,
which would prohibit or forgive the Company or the Guarantor, as the case may
be, from paying all or any portion of the Principal Amount at Maturity, Issue
Price plus accrued Original Issue Discount, Redemption Price, Purchase Price or
Change in Control Purchase Price in respect of Securities, or any interest on
such amounts, as contemplated herein, or which may affect the covenants or the
performance of this Indenture; and each of the Company and the Guarantor (in
each case, to the extent that it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.
ARTICLE VII
TRUSTEE
Section 7.1 Duties of Trustee.
-----------------
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise the rights and powers vested in it by this Indenture and use the
same degree of care and skill in its exercise as a prudent person would exercise
or use under the circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties that are specifically
set forth in this Indenture and no others; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates
or opinions furnished to the Trustee and conforming to the
requirements of
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this Indenture, but in case of any such certificates or opinions
which by any provision hereof are specifically required to be
furnished to the Trustee, the Trustee shall examine the
certificates and opinions to determine whether or not they conform
to the requirements of this Indenture, but need not confirm or
investigate the accuracy of mathematical calculations or other
facts stated therein. This Section 7.1(b) shall be in lieu of
Section 3.15(a) of the TIA and such Section 315(a) is hereby
expressly excluded from this Indenture, as permitted by the TIA.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph (c) does not limit the effect of paragraph (b) of
this Section 7.1;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.5.
Subparagraphs (c)(1), (2) and (3) shall be in lieu of Sections 315(d)(1),
315(d)(2) and 315(d)(3) of the TIA and such Sections 315(d)(1), 315(d)(2) and
315(d)(3) are hereby expressly excluded from this Indenture, as permitted by the
TIA.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (e) of this Section 7.1.
(e) The Trustee may refuse to perform any duty or exercise any right
or power or extend or risk its own funds or otherwise incur any financial
liability unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
(acting in any capacity hereunder) shall be under no liability for interest on
any money
54
received by it hereunder unless otherwise agreed in writing with the Company.
Section 7.2 Rights of Trustee. Subject to its duties and
-----------------
responsibilities under the TIA,
(a) the Trustee may conclusively rely and shall be protected in acting
or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking, suffer
ing or omitting any action hereunder, the Trustee (unless other evidence be
herein specifically prescribed) may, in the absence of bad faith on its part,
conclusively rely upon an Officers' Certificate;
(c) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(d) The Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith which it believes to be authorized or
within its rights or powers conferred under this Indenture;
(e) The Trustee may consult with counsel selected by it and any advice
or Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in good faith
and in accordance with such advice or Opinion of Counsel.
(f) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee security or indemnity
satisfactory to it against the costs, expenses and liabilities which may be
incurred therein or thereby.
(g) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;
55
(h) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discre tion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney
at the sole cost of the Company and shall incur no liability or additional
liability of any kind by reason of such inquiry or investigation;
(i) the Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Securities or the Guarantees and this Indenture;
(j) the rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder; and
(k) the Trustee may request that the Company or the Guarantor deliver
an Officers' Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Indenture, which Officers' Certificate may be signed by any person authorized to
sign an Officers' Certificate, including any person specified as so authorized
in any such certificate previously delivered and not superseded.
Section 7.3 Individual Rights of Trustee. The Trustee in its
----------------------------
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, Conversion
Agent or co-registrar may do the same with like rights. However, the Trustee
must comply with Sections 7.10 and 7.11.
Section 7.4 Trustee's Disclaimer. The Trustee makes no
--------------------
representation as to the validity or adequacy of this Indenture or the
Securities, it shall not be accountable for the Company's use or application of
the proceeds from the Securities, it shall not be responsible for any statement
in the registration statement for the Securities under the Securities Act or in
any offering document for the Securities, the
56
Indenture, the Securities (other than its certificate of authentication) or the
Guarantees, or the determination as to which beneficial owners are entitled to
receive any notices hereunder.
Section 7.5 Notice of Defaults. If a Default occurs and if it is
------------------
known to the Trustee, the Trustee shall give to each Securityholder notice of
the Default within 90 days after it occurs or, if later, within 15 days after it
is known to the Trustee, unless such Default shall have been cured or waived
before the giving of such notice. Notwithstanding the preceding sentence,
except in the case of a Default described in Section 6.1(1), the Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in
good faith determines that withholding the notice is in the interests of
Securityholders. The second sentence of this Section 7.5 shall be in lieu of
the proviso to Section 315(b) of the TIA and such proviso is hereby expressly
excluded from this Indenture, as permitted by the TIA. The Trustee shall not be
deemed to have knowledge of a Default unless a Responsible Officer of the
Trustee has received written notice of such Default.
Section 7.6 Reports by Trustee to Holders. Within 60 days after
-----------------------------
each May 15 beginning with the May 15 following the date of this Indenture, the
Trustee shall mail to each Securityholder a brief report dated as of such May 15
that complies with TIA Section 313(a), if required by such Section 313(a). The
Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each securities exchange, if any, on which the
Securities are listed. The Company agrees to notify the Trustee promptly
whenever the Securities become listed on any securities exchange and of any
delisting thereof.
Section 7.7 Compensation and Indemnity. The Company agrees:
--------------------------
(a) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited (to
the extent permitted by law) by any provision of law in regard to the
compensation of a trustee of an express trust);
(b) to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the reasonable
compensation and the expenses, advances and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad
57
faith; and
(c) to indemnify the Trustee or any predecessor, Trustee and their
agents for, and to hold them harmless against, any loss, damage, claim,
liability, cost or expense (including attorney's fees and taxes (other than
taxes based upon, measured by or determined by the income of the Trustee))
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of this trust, including the
costs and expenses of defending itself against any claim (whether asserted by
the Company or any Holder or any other Person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder.
To secure the Company's payment obligations in this Section 7.7, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee, except that held in trust to pay the Principal
Amount at Maturity, Issue Price plus accrued Original Issue Discount, Redemption
Price, Purchase Price, Change in Control Purchase Price or interest, if any, as
the case may be, on particular Securities.
The Company's payment obligations pursuant to this Section 7.7 shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.1(5), the expenses including
the reasonable charges and expenses of its counsel, are intended to constitute
expenses of administration under any bankruptcy law.
Section 7.8 Replacement of Trustee. The Trustee may resign by so
----------------------
notifying the Company; provided, however, no such resignation shall be effective
until a successor Trustee has accepted its appointment pursuant to this Section
7.8. The Holders of a majority in aggregate Principal Amount at Maturity of the
Securi ties at the time outstanding may remove the Trustee by so notifying the
Trustee and the Company. The Company shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or public officer takes charge of the Trustee or its
property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office
58
of Trustee for any reason, the Company shall promptly appoint, by resolution of
its Board of Directors, a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company satisfactory in form and
substance to the retiring Trustee and the Company. Thereupon the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Securityholders. The retiring Trustee shall promptly transfer all property held
by it as Trustee to the successor Trustee, subject to the lien provided for in
Section 7.7.
If a successor Xxxxxxx does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding may petition any court of competent
jurisdiction at the expense of the Company for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Section 7.9 Successor Trustee by Xxxxxx. If the Trustee
---------------------------
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation, the
resulting, surviving or transferee corporation without any further act shall be
the successor Trustee.
Section 7.10 Eligibility; Disqualification. The Trustee shall at
-----------------------------
all times satisfy the requirements of TIA Sections 310(a)(1) and 310(b). The
Trustee (or its parent holding company) shall have a combined capital and
surplus of at least $50,000,000 as set forth in its most recent published annual
report of condition. Nothing herein contained shall prevent the Trustee from
filing with the SEC the application referred to in the penultimate paragraph of
TIA Section 310(b).
Section 7.11 Preferential Collection of Claims Against Company. The
-------------------------------------------------
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
59
ARTICLE VIII
DISCHARGE OF INDENTURE
Section 8.1 Discharge of Liability on Securities. When (i) the
------------------------------------
Company delivers to the Trustee all outstanding Securities (other than
Securities replaced pursuant to Section 2.7) for cancellation or (ii) all
outstanding Securities have become due and payable and the Company or the
Guarantor deposits with the Trustee cash sufficient to pay all amounts due and
owing on all outstanding Securi ties (other than Securities replaced pursuant to
Section 2.7), and if in either case the Company or the Guarantor pays all other
sums payable hereunder by the Company, then this Indenture shall, subject to
Section 7.7, cease to be of further effect. The Trustee shall join in the
execution of a document prepared by the Company acknowledging satisfaction and
discharge of this Indenture on demand of the Company accompanied by an Officers'
Certificate and Opinion of Counsel and at the cost and expense of the Company.
Section 8.2 Repayment to the Company. The Trustee and the Paying
------------------------
Agent shall return to the Company or the Guarantor, as applicable, upon written
request any money or securities held by them for the payment of any amount with
respect to the Securities that remains unclaimed for two years, subject to
applicable unclaimed property law. After return to the Company or the
Guarantor, as applicable, Holders entitled to the money or securities must look
to the Company or the Guarantor, as the case may be, for payment as general
creditors unless an applicable abandoned property law designates another person
and the Trustee and the Paying Agent shall have no further liability to the
Securityholders with respect to such money or securities for that period
commencing after the return thereof.
ARTICLE IX
AMENDMENTS
Section 9.1 Without Consent of Holders. The Company, the Guarantor
--------------------------
and the Trustee may amend this Indenture, the Securities or the Guarantees
without the consent of any Securityholder, so long as such changes, other than
those in clause (2), do not materially and adversely affect the interests of the
Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 5 or Section 10.14;
60
(3) to secure the Company's obligations under the Securities and this
Indenture;
(4) to add to the Company's or the Guarantor's covenants for the
benefit of the Securityholders or to surrender any right or power conferred upon
the Company or the Guarantor; or
(5) to make any change necessary for the registration of the
Securities under the Securities Act or to comply with the TIA, or any amendment
thereto, or to comply with any requirement of the SEC in connection with the
qualification of the Indenture under the TIA.
Section 9.2 With Consent of Holders. With the written consent of
-----------------------
the Holders of at least a majority in aggregate Principal Amount at Maturity of
the Securities at the time outstanding, the Company, the Guarantor and the
Trustee may amend this Indenture, the Securities or the Guarantees. However,
without the consent of each Securityholder affected, an amendment to this
Indenture, the Securities or the Guarantees may not:
(1) make any change in the manner or rate of accrual in connection
with Original Issue Discount, reduce the rate of interest referred to in
paragraph 1 of the Securities, or extend the time for payment of Original Issue
Discount on any Security;
(2) reduce the Principal Amount at Maturity or the Issue Price of or
extend the Stated Maturity of any Security;
(3) reduce the Redemption Price, Purchase Price or Change in Control
Purchase Price of any Security;
(4) make any Security payable in money or securities other than that
stated in the Security;
(5) make any change in Section 6.4, Section 6.7 or this Section 9.2,
except to increase any percentage set forth therein;
(6) make any change that adversely affects the right to convert any
Security; or
(7) make any change that adversely affects the right to require the
Company to purchase the Securities in accordance with the terms thereof and this
Indenture.
61
It shall not be necessary for the consent of the Holders under this
Section 9.2 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section 9.2 becomes effective, the
Company shall mail to each Holder a notice briefly describing the amendment.
Section 9.3 Compliance with Trust Indenture Act. Every
-----------------------------------
supplemental indenture executed pursuant to this Article shall comply with the
TIA.
Section 9.4 Revocation and Effect of Consents, Waivers and Actions.
------------------------------------------------------
Until an amendment, waiver or other action by Holders becomes effective, a
consent thereto by a Holder of a Security hereunder is a continuing consent by
the Holder and every subsequent Holder of that Security or portion of the
Security that evidences the same obligation as the consenting Holder's Security,
even if notation of the consent, waiver or action is not made on the Security.
However, any such Holder or subsequent Holder may revoke the consent, waiver or
action as to such Holder's Security or portion of the Security if the Trustee
receives the notice of revocation before the date the amendment, waiver or
action becomes effective. After an amendment, waiver or action becomes
effective, it shall bind every Securityholder.
Section 9.5 Notation on or Exchange of Securities. Securities
-------------------------------------
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article 9 may, and shall if required by the Trustee, bear a
notation in form approved by the Trustee as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new Securities so
modified as to conform, in the opinion of the Trustee and the Board of Directors
of the Company, to any such supplemental indenture may be prepared and executed
by the Company and authenticated and delivered by the Trustee in exchange for
outstanding Securities.
Section 9.6 Trustee to Sign Supplemental Indentures. The Trustee
---------------------------------------
shall sign any supplemental indenture authorized pursuant to this Article 9 if
the amendment contained therein does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If it does, the Trustee may, but need
not, sign such supplemental indenture. In signing such supplemental indenture
the Trustee shall receive, and (subject to the provisions of Section 7.1) shall
be fully protected in relying upon, an Officers' Certificate and an Opinion of
Counsel stating that such amendment is authorized or permitted by this
Indenture.
Section 9.7 Effect of Supplemental Indentures. Upon the execution
---------------------------------
of any supplemental indenture under this Article, this Indenture shall be
modified in
62
accordance therewith, and such supplemental indenture shall form a part of this
Indenture for all purposes; and every Holder of Securities theretofore or
thereafter authenticated and delivered hereunder shall be bound thereby.
ARTICLE X
CONVERSIONS
Section 10.1 Conversion Privilege. A Holder of a Security may
--------------------
convert such Security into Common Shares at any time during the period stated in
paragraph 8 of the Securities. The number of shares of Common Shares
deliverable upon conversion of a Security per $1,000 of Principal Amount at
Maturity thereof (the "Conversion Rate") shall be that set forth in paragraph 8
in the Securities, subject to adjustment as herein set forth.
A Holder may convert a portion of the Principal Amount at Maturity of
a Security if the portion is $1,000 or an integral multiple of $1,000.
Provisions of this Indenture that apply to conversion of all of a Security also
apply to conversion of a portion of a Security.
In the event that the Ex-Dividend Time (or in the case of a subdivision,
combination or reclassification, the effective date with respect thereto) with
respect to a dividend, subdivision, combination or reclassification to which
Section 10.6(1), (2), (3) or (5) applies occurs during the period applicable for
calculating "Average Sale Price" pursuant to the definition in Section 10.7,
"Average Sale Price" shall be calculated for such period in a manner determined
by the Board of Directors of Tyco to reflect the impact of such dividend,
subdivision, combination or reclassification on the Sale Price of the Common
Shares during such period.
"Time of Determination" means the time and date of the earlier of (i) the
determination of stockholders entitled to receive rights, warrants or options or
a distribution, in each case, to which Section 10.7 or 10.8 applies and (ii) the
time ("Ex-Dividend Time") immediately prior to the commencement of "ex-dividend"
trading for such rights, warrants or options or distribution on the New York
Stock Exchange or such other national or regional exchange or market on which
the Common Shares are then listed or quoted.
Section 10.2 Conversion Procedure. To convert a Security a Holder
--------------------
must satisfy the requirements in paragraph 8 of the Securities. The first
Business Day
63
on which the Holder satisfies all those requirements is the conversion date (the
"Conversion Date").
The Company shall have the option, exercisable at any time or from
time to time, to designate or change the designation, by an instrument in
writing signed by the Company and provided to the Conversion Agent, a financial
institution to which Securities surrendered by a Holder for conversion will be
initially offered by the Conversion Agent on behalf of a Holder for exchange (an
"Exchange Party"). The Company shall enter into an agreement with the Conversion
Agent providing that at the opening of business on each Business Day, the
Conversion Agent shall inform the Exchange Party as to the aggregate Principal
Amount of Securities surrendered for exchange on the prior Business Day. The
Exchange Party may accept for exchange all or any of such Securities if it
agrees, no later than the time specified in the agreement between the Company
and the Conversion Agent, to deliver in exchange therefor the number of Common
Shares and other property that would be delivered on conversion of such
Securities in accordance with the terms of this Indenture. Settlement for any
such exchange shall take place no later than the third Business Day following
such acceptance. In the event that the Exchange Party fails to deliver the
Common Shares by such third Business Day, the Exchange Party shall be in default
of its obligations and, instead of being exchanged, the Securities will be
converted in accordance with their terms. A Holder whose Securities are
exchanged in whole or in part shall be given a written confirmation from the
Conversion Agent informing such Holder as to the aggregate Principal Amount at
Maturity of the Securities so exchanged. For purposes of the following
paragraphs, Securities for which the Company provides the Common Shares shall be
referred to as Securities which have been "converted," while Securities for
which the Exchange Party supplies Common Shares shall be referred to as
Securities which have been "exchanged." Any Securities which have been
exchanged shall remain outstanding. The agreement between the Company and the
Conversion Agent setting forth the procedures to be followed in an exchange may
be changed at any time so long as such change does not have a material adverse
effect on a Holder which surrenders its Securities for conversion.
As soon as practicable after the Conversion Date, the Company or the
Exchange Party shall deliver to the Holder, through the Conversion Agent, a
certificate for the number of full Common Shares deliverable upon the conversion
or exchange and cash in lieu of any fractional share determined pursuant to
Section 10.3. The person in whose name the certificate is registered shall be
treated as a shareholder of record on and after the next Business Day following
the Conversion Date. Upon conversion or exchange of a Security, such person
shall no longer be a Holder of such Security.
64
No payment or adjustment will be made for dividends on, or other
distributions with respect to, any Common Shares except as provided in this
Article 10. On conversion of a Security, that portion of accrued Original Issue
Discount attributable to the period from the Issue Date of the Security through
the Conversion Date with respect to the converted Security shall not be
cancelled, extinguished or forfeited, but rather shall be deemed to be paid in
full to the Holder thereof through delivery of the Common Shares (together with
the cash payment, if any, in lieu of fractional shares) for the Security being
converted pursuant to the provisions hereof; and the fair market value of such
Common Shares (together with any such cash payment in lieu of fractional shares)
shall be treated as issued, to the extent thereof, first in exchange for
Original Issue Discount accrued through the Conversion Date, and the balance, if
any, of such fair market value of such Common Shares (and any such cash payment)
shall be treated as issued for the Issue Price of the Security being converted
pursuant to the provisions hereof. If the Holder converts more than one
Security at the same time, the number of Common Shares deliverable upon the
conversion shall be based on the total Principal Amount at Maturity of the
Securities converted.
If the last day on which a Security may be converted is a Legal
Holiday, the Security may be surrendered on the next succeeding day that is not
a Legal Holiday.
Upon surrender of a Security that is converted in part, the Company
shall execute, the Guarantor shall endorse and the Trustee shall authenticate
and deliver to the Holder, a new Security in an authorized denomination equal in
Principal Amount at Maturity to the unconverted portion of the Security
surrendered.
Section 10.3 Fractional Shares. Securityholders will not receive a
-----------------
fractional share upon conversion or exchange of a Security. Instead, the Holder
will receive cash for the current market value of the fractional share. The
current market value of a fractional share shall be determined, to the nearest
1/1,000th of a share, by multiplying the Sale Price, on the last trading day
prior to the Conversion Date, of a full share by the fractional amount and
rounding the product to the nearest whole cent.
Section 10.4 Taxes on Conversion. If a Holder submits a Security
-------------------
for conversion, the Company shall pay any documentary, stamp or similar issue or
transfer tax due on the issue of Common Shares upon the conversion. However,
the Holder shall pay any such tax which is due because the Holder requests the
Common Shares to be delivered in a name other than the Holder's name. The
Conversion Agent may refuse to deliver the certificates representing the Common
Shares being
65
delivered in a name other than the Holder's name until the Conversion Agent
receives a sum sufficient to pay any tax which will be due because the shares
are to be delivered in a name other than the Holder's name. Nothing herein shall
preclude any tax withholding required by law or regulations.
Section 10.5 Company to Provide Stock. All Common Shares delivered
------------------------
upon conversion of the Securities shall be duly and validly issued and fully
paid and nonassessable, and shall be free from preemptive rights and free of any
lien or adverse claim. All Common Shares delivered by an Exchange Agent must be
delivered free of any lien or adverse claim and must have been duly and validly
issued and fully paid and nonassessable. The Company and Tyco will endeavor
promptly to comply with all federal and state securities laws regulating the
offer and delivery of Common Shares upon conversion of Securities, if any, and
will list or cause to have quoted such Common Shares on each national securities
exchange or in the over-the-counter market or such other market on which the
Common Shares are then listed or quoted.
Section 10.6 Adjustment for Change In Capital Stock. If, after the
--------------------------------------
Issue Date of the Securities, Tyco:
(1) pays a dividend or makes a distribution on its Common Shares in Common
Shares;
(2) subdivides its outstanding Common Shares into a greater number of
shares;
(3) combines its outstanding shares of Common Shares into a smaller number
of shares;
(4) pays a dividend or makes a distribution on its Common Shares in shares
of its Capital Stock (other than Common Shares or rights, warrants or options
for its Capital Stock); or
(5) issues by reclassification of its Common Shares any shares of its
Capital Stock (other than rights, warrants or options for its Capital Stock),
then the conversion privilege and the Conversion Rate in effect immediately
prior to such action shall be adjusted so that the Holder of a Security
thereafter converted may receive the number of shares of Capital Stock of Tyco
which such Holder would have owned immediately following such action if such
Holder had converted the Security immediately prior to such action.
66
The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
If after an adjustment a Holder of a Security upon conversion of such
Security may receive shares of two or more classes of Capital Stock of Tyco, the
Conversion Rate shall thereafter be subject to adjustment upon the occurrence of
an action taken with respect to any such class of Capital Stock as is
contemplated by this Article 10 with respect to the Common Shares, on terms
comparable to those applicable to Common Shares in this Article 10.
Section 10.7 Adjustment for Rights Issue. If after the Issue Date
---------------------------
of the Securities, Tyco distributes any rights, warrants or options to all
holders of its Common Shares entitling them, for a period expiring within 60
days after the record date for such distribution, to purchase Common Shares at a
price per share less than the Average Sale Price as of the Time of
Determination, the Conversion Rate shall be adjusted in accordance with the
formula:
R' = R x (O + N)
-----------
(O + (N x P)/M)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
O = the number of Common Shares outstanding on the record date for the
distribution to which this Section 10.7 is being applied.
N = the number of additional Common Shares offered pursuant to the
distribution.
P = the offering price per share of the additional shares.
M = the Average Sale Price, minus, in the case of (i) a distribution to
which Section 10.6(4) applies or (ii) a distribution to which Section 10.8
applies, for which, in each case, (x) the record date shall occur on or before
the record date for the distribution to which this Section 10.7 applies and (y)
the Ex-Dividend Time shall occur on or after the date of the Time of
Determination for the distribution to which this Section 10.7 applies, the fair
market value (on the record date for the distribution
67
to which this Section 10.7 applies) of the
(1) Capital Stock of Tyco distributed in respect of each Common Share in
such Section 10.6(4) distribution, and
(2) assets of Tyco or debt securities or any rights, warrants or options
to purchase securities of Tyco distributed in respect of each Common Share in
such Section 10.8 distribution.
The Board of Directors of Tyco shall determine fair market values for the
purposes of this Section 10.7, except as Section 10.8 otherwise provides in the
case of a spin-off.
"Average Sale Price" means the average of the Sale Prices of the Common
Shares for the shorter of
(i) 30 consecutive trading days ending on the last full
trading day prior to the Time of Determination with respect to the rights,
warrants or options or distribution in respect of which the Average Sale
Price is being calculated, or
(ii) the period (x) commencing on the date next succeeding the
first public announcement of (a) the issuance of rights, warrants or
options or (b) the distribution, in each case, in respect of which the
Average Sale Price is being calculated and (y) proceeding through the last
full trading day prior to the Time of Determination with respect to the
rights, warrants or options or distribution in respect of which the Average
Sale Price is being calculated (excluding days within such period, if any,
which are not trading days), or
(iii) the period, if any, (x) commencing on the date next
succeeding the Ex-Dividend Time with respect to the next preceding (a)
issuance of rights, warrants or options or (b) distribution, in each case,
for which an adjustment is required by the provisions of Section 10.6(4),
10.7 or 10.8 and (y) proceeding through the last full trading day prior to
the Time of Determination with respect to the rights, warrants or options
or distribution in respect of which the Average Sale Price is being
calculated (excluding days within such period, if any, which are not
trading days).
The adjustment shall become effective immediately after the record
68
date for the determination of shareholders entitled to receive the rights,
warrants or options to which this Section 10.7 applies. If all of the Common
Shares subject to such rights, warrants or options have not been issued when
such rights, warrants or options expire, then the Conversion Rate shall promptly
be readjusted to the Conversion Rate which would then be in effect had the
adjustment upon the issuance of such rights, warrants or options been made on
the basis of the actual number of Common Shares issued upon the exercise of such
rights, warrants or options.
No adjustment shall be made under this Section 10.7 if the application
of the formula stated above in this Section 10.7 would result in a value of R'
that is equal to or less than the value of R.
Section 10.8 Adjustment for Other Distributions. If, after the
----------------------------------
Issue Date of the Securities, Tyco distributes to all holders of its Common
Shares any of its assets, or debt securities or any rights, warrants or options
to purchase securities of Tyco (including securities or cash, but excluding (x)
distributions of Capital Stock referred to in Section 10.6 and distributions of
rights, warrants or options referred to in Section 10.7 and (y) cash dividends
or other cash distributions that are paid out of consolidated current net
earnings or earnings retained in the business as shown on the books of Tyco
unless such cash dividends or other cash distributions are Extraordinary Cash
Dividends) the Conversion Rate shall be adjusted, subject to the provisions of
the last paragraph of this Section 10.8, in accordance with the formula:
R' = R x M
-------
(M-F)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the Average Sale Price, minus, in the case of a distribution to which
Section 10.6(4) applies, for which (i) the record date shall occur on or before
the record date for the distribution to which this Section 10.8 applies and (ii)
the Ex-Dividend Time shall occur on or after the date of the Time of
Determination for the distribution to which this Section 10.8 applies, the fair
market value (on the record date for the distribution to which this Section 10.8
applies) of any Capital Stock of Tyco distributed in respect of each share of
Common Shares in such Section 10.6(4) distribution.
69
F = the fair market value (on the record date for the distribution to
which this Section 10.8 applies) of the assets, securities, rights, warrants or
options to be distributed in respect of each Common Share in the distribution to
which this Section 10.8 is being applied (including, in the case of cash
dividends or other cash distributions giving rise to an adjustment, all such
cash distributed concurrently).
The Board of Directors of Tyco shall determine fair market values for
the purposes of this Section 10.8, except that in respect of a dividend or other
distribution of shares of Capital Stock of any class or series, or similar
equity interests, of or relating to a Subsidiary or other business unit of Tyco
(a "Spin-off"), the fair market value of the securities to be distributed shall
equal the average of the daily Sale Prices of those securities for the five
consecutive trading days commencing on and including the sixth day of trading of
those securities after the effectiveness of the Spin-off and the Average of the
Sale Prices shall mean the average Sale Prices for the Common Shares for the
same five trading days. In the event, however, that an underwritten initial
public offering of the securities in the Spin-off occurs simultaneously with the
Spin-off, fair market value of the securities distributed in the Spin-off shall
mean the initial public offering price of such securities and the Average Sale
Price shall mean the Sale Price for the Common Shares on the same trading day.
The adjustment shall become effective immediately after the record
date for the determination of shareholders entitled to receive the distribution
to which this Section 10.8 applies, except that an adjustment related to a Spin-
off shall become effective at the earlier to occur of (i) 10 trading days after
the effective date of the Spin-off and (ii) the initial public offering of the
securities distributed in the Spin-off.
For purposes of this Section 10.8, the term "Extraordinary Cash
Dividend" shall mean any cash dividend with respect to the Common Shares the
amount of which, together with the aggregate amount of cash dividends on the
Common Shares to be aggregated with such cash dividend in accordance with the
provisions of this paragraph, equals or exceeds the threshold percentage set
forth in the following paragraph. For purposes of the following paragraph, the
"Measurement Period" with respect to a cash dividend on the Common Shares shall
mean the 365 consecutive day period ending on the date prior to the Ex-Dividend
Time with respect to such cash dividend, and the "Relevant Cash Dividends" with
respect to a cash dividend on the Common Shares shall mean the cash dividends on
the Common Shares with Ex-Dividend Times occurring in the Measurement Period.
If, upon the date prior to the Ex-Dividend Time with respect a cash
dividend on the Common Shares, the aggregate amount of such cash dividend
together with the amounts of all Relevant Cash Dividends equals or exceeds on a
per
70
share basis 5% of the Sale Price of the Common Shares on the last trading day
preceding the date of declaration by the Board of Directors of Tyco of the cash
dividend with respect to which this provision is being applied, then such cash
dividend together with all Relevant Cash Dividends, shall be deemed to be an
Extraordinary Cash Dividend and for purposes of applying the formula set forth
above in this Section 10.8, the value of "F" shall be equal to (y) the aggregate
amount of such cash dividend together with the amount of all Relevant Cash
Dividends, minus (z) the aggregate amount of all Relevant Cash Dividends for
which a prior adjustment in the Conversion Rate was previously made under this
Section 10.8.
In making the determinations required by the preceding paragraph, the
amount of cash dividends paid on a per share basis and the amount of any
Relevant Cash Dividends specified in the preceding paragraph, shall be
appropriately adjusted to reflect the occurrence during such period of any event
described in Section 10.6.
In the event that, with respect to any distribution to which this
Section 10.8 would otherwise apply, the difference "M-F" as defined in the above
formula is less than $1.00 or "F" is equal to or greater than "M", then the
adjustment provided by this Section 10.8 shall not be made and in lieu thereof
the provisions of Section 10.14 shall apply to such distribution.
Section 10.9 When Adjustment May Be Deferred. No adjustment in the
-------------------------------
Conversion Rate need be made unless the adjustment would require an increase or
decrease of at least 1% in the Conversion Rate. Any adjustments that are not
made shall be carried forward and taken into account in any subsequent
adjustment.
All calculations under this Article 10 shall be made to the nearest
cent or to the nearest 1/1,000th of a share, as the case may be.
Section 10.10 When No Adjustment Required. No adjustment need be
---------------------------
made for a transaction referred to in Section 10.6, 10.7, 10.8 or 10.14 if
Securityholders are to participate in the transaction without conversion on a
basis and with notice that the Board of Directors of Tyco determines to be fair
and appropriate in light of the basis and notice on which holders of Common
Shares participate in the transaction. No adjustment need be made for rights to
purchase Common Shares pursuant to a Tyco plan for reinvestment of dividends or
interest.
No adjustment need be made for a change in the par value or no par
value of the Common Shares.
To the extent the Securities become convertible pursuant to this
71
Article 10 in whole or in part into cash, no adjustment need be made thereafter
as to the cash. Interest will not accrue on the cash.
Section 10.11 Notice of Adjustment. Whenever the Conversion Rate is
--------------------
adjusted, the Company shall promptly mail to Securityholders a notice of the
adjustment. The Company shall file with the Trustee and the Conversion Agent
such notice and a certificate from Tyco's independent public accountants briefly
stating the facts requiring the adjustment and the manner of computing it. The
certificate shall be conclusive evidence that the adjustment is correct.
Neither the Trustee nor any Conversion Agent shall be under any duty or
responsibility with respect to any such certificate except to exhibit the same
to any Holder desiring inspection thereof.
Section 10.12 Voluntary Increase. The Company from time to time may
------------------
increase the Conversion Rate by any amount for any period of time. Whenever the
Conversion Rate is increased, the Company shall mail to Securityholders and file
with the Trustee and the Conversion Agent a notice of the increase. The Company
shall mail the notice at least 15 days before the date the increased Conversion
Rate takes effect. The notice shall state the increased Conversion Rate and the
period it will be in effect. A voluntary increase of the Conversion Rate does
not change or adjust the Conversion Rate otherwise in effect for purposes of
Section 10.6, 10.7 or 10.8.
Section 10.13 Notice of Certain Transactions. If:
------------------------------
(1) Tyco takes any action that would require an adjustment in the
Conversion Rate pursuant to Section 10.6, 10.7 or 10.8 (unless no adjustment is
to occur pursuant to Section 10.10); or
(2) the Company or Tyco takes any action that would require a supplemental
indenture pursuant to Section 10.14; or
(3) there is a liquidation or dissolution of the Company or Tyco;
then the Company shall mail to Securityholders and file with the Trustee and the
Conversion Agent a notice stating the proposed record date for a dividend or
distribution or the proposed effective date of a subdivision, combination,
reclassification, consolidation, merger, binding share exchange, transfer,
liquidation or dissolution. The Company shall file and mail the notice at least
15 days before such date. Failure to file or mail the notice or any defect in
it shall not affect the validity of the transaction.
72
Section 10.14 Reorganization of Tyco; Special Distributions. If Tyco
---------------------------------------------
is a party to a transaction subject to Section 5.1 (other than a sale of all or
substantially all of the assets of Tyco in a transaction in which the holders of
Common Shares immediately prior to such transaction do not receive securities,
cash or other assets of Tyco or any other person) or a merger or binding share
exchange which reclassifies or changes its outstanding Common Shares, the person
obligated to deliver securities, cash or other assets upon conversion of
Securities shall enter into a supplemental indenture. If the issuer of
securities deliverable upon conversion of Securities is an Affiliate of the
successor to Tyco, that issuer shall join in the supplemental indenture.
The supplemental indenture shall provide that the Holder of a Security
may convert it into the kind and amount of securities, cash or other assets
which such Holder would have received immediately after the consolidation,
merger, binding share exchange or transfer if such Holder had converted the
Security immediately before the effective date of the transaction, assuming (to
the extent applicable) that such Holder (i) was not a constituent person or an
Affiliate of a constituent person to such transaction; (ii) made no election
with respect thereto; and (iii) was treated alike with the plurality of non-
electing Holders. The supplemental indenture shall provide for adjustments which
shall be as nearly equivalent as may be practical to the adjustments provided
for in this Article 10. The Company shall mail to Securityholders a notice
briefly describing the supplemental indenture.
If this Section applies, neither Section 10.6 nor 10.7 applies.
If Tyco makes a distribution to all holders of its Common Shares of any of
its assets, or debt securities or any rights, warrants or options to purchase
securities of Tyco that, but for the provisions of the last paragraph of Section
10.8, would otherwise result in an adjustment in the Conversion Rate pursuant to
the provisions of Section 10.8, then, from and after the record date for
determining the holders of Common Shares entitled to receive the distribution, a
Holder of a Security that converts such Security in accordance with the
provisions of this Indenture shall upon such conversion be entitled to receive,
in addition to the shares of Common Shares into which the Security is
convertible, the kind and amount of securities, cash or other assets comprising
the distribution that such Holder would have received if such Holder had
converted the Security immediately prior to the record date for determining the
holders of Common Shares entitled to receive the distribution.
Section 10.15 Company or Tyco Determination Final. Any determination
-----------------------------------
that the Company, Tyco or their respective Boards of Directors must make
pursuant to Section 10.3, 10.6, 10.7, 10.8, 10.9, 10.10, 10.14 or 10.17 is
conclusive, absent manifest error.
73
Section 10.16 Trustee's Adjustment Disclaimer. The Trustee has no
-------------------------------
duty to determine when an adjustment under this Article 10 should be made, how
it should be made or what it should be. The Trustee has no duty to determine
whether a supplemental indenture under Section 10.14 need be entered into or
whether any provisions of any supplemental indenture are correct. The Trustee
shall not be accountable for and makes no representation as to the validity or
value of any securities or assets delivered upon conversion of Securities. The
Trustee shall not be responsible for the Company's or Tyco's failure to comply
with this Article 10. Each Conversion Agent shall have the same protection
under this Section 10.16 as the Trustee.
Section 10.17 Simultaneous Adjustments. In the event that this
------------------------
Article 10 requires adjustments to the Conversion Rate under more than one of
Sections 10.6(4), 10.7 or 10.8, and the record dates for the distributions
giving rise to such adjustments shall occur on the same date, then such
adjustments shall be made by applying, first, the provisions of Section 10.6,
second, the provisions of Section 10.8 and, third, the provisions of Section
10.7.
Section 10.18 Successive Adjustments. After an adjustment to the
----------------------
Conversion Rate under this Article 10, any subsequent event requiring an
adjustment under this Article 10 shall cause an adjustment to the Conversion
Rate as so adjusted.
ARTICLE XI
GUARANTEES
Section 11.1 Guarantees. Except as otherwise provided herein, the
----------
Guarantor hereby fully and unconditionally guarantees to each Holder of a
Security authenticated and delivered by the Trustee, and to the Trustee on
behalf of such Holder, the due and punctual payment of the principal of and
premium, if any, on such Security and all other obligations of the Company under
this Indenture when and as the same shall become due and payable, whether at the
stated maturity, by acceleration, call for redemption, upon a repurchase date or
otherwise, in accordance with the terms of such Security and of this Indenture,
including, but not limited to, the obligation of the Company to deliver Common
Shares to Holders upon conver sion of the Securities. The Guarantor hereby
fully and unconditionally also guaran tees to the Trustee the due and punctual
payment of all obligations of the Company to the Trustee under this Indenture.
In case of the failure of the Company punctually to make any such payment, the
Guarantor hereby agrees to cause such payment to be
74
made punctually when and as the same shall become due and payable, whether at
the stated maturity or by acceleration, call for redemption, upon a repurchase
date or otherwise, and as if such payment were made by the Company.
The Guarantor agrees that its obligations hereunder shall be absolute
and unconditional, irrespective of, and shall be unaffected by, the validity,
regularity or enforceability of such Security or this Indenture, the absence of
any action to enforce the same or any release, amendment, waiver or indulgence
granted to the Company or the Guarantor or any consent to departure from any
requirement of any other guarantee of all or any of the Securities or any other
circumstances which might otherwise constitute a legal or equitable discharge or
defense of a surety or guarantor. The Guarantor hereby waives the benefits of
diligence, presentment, demand for payment, any requirement that the Trustee or
any of the Holders protect, secure, perfect or insure any security interest in
or other lien on any property subject thereto or exhaust any right or take any
action against the Company or any other Person or any collateral, filing of
claims with a court in the event of insolvency or bankruptcy of the Company, any
right to require a proceeding first against the Company, protest or notice with
respect to such Security or the Indebtedness evidenced thereby and all demands
whatsoever, and covenants that this Guarantee will not be discharged in respect
of such Security except by complete performance of the obligations contained in
such Security and in such Guarantee. The Guarantor agrees that if, after the
occurrence and during the continuance of an Event of Default, the Trustee or any
of the Holders are prevented by applicable law from exercising their respective
rights to accelerate the maturity of the Securities, to collect premium, if any,
on the Securities, or to enforce or exercise any other right or remedy with
respect to the Securities, the Guarantor agrees to pay to the Trustee for the
account of the Holders, upon demand therefor, the amount that would otherwise
have been due and payable had such rights and remedies been permitted to be
exercised by the Trustee or any of the Holders.
The Guarantor shall be subrogated to all rights of the Holders of the
Securities upon which its Guarantee is endorsed against the Company in respect
of any amounts paid by the Guarantor on account of such Security pursuant to the
provisions of its Guarantee or this Indenture; provided, however, that the
Guarantor shall not be entitled to enforce or to receive any payment arising out
of, or based upon, such right of subrogation until the principal of and premium,
if any, on all Securities issued hereunder shall have been paid in full.
Each Guarantee shall remain in full force and effect and continue to
be effective should any petition be filed by or against the Company for
liquidation or reorganization, should the Company become insolvent or make an
assignment for the benefit of creditors or should a receiver or trustee be
appointed for all or any part of
75
the Company's assets, and shall, to the fullest extent permitted by law,
continue to be effective or be reinstated, as the case may be, if at any time
payment and performance of the Securities, is, pursuant to applicable law,
rescinded or reduced in amount, or must otherwise be restored or returned by any
Holder of the Securities, whether as a "voidable preference," "fraudulent
transfer," or otherwise, all as though such payment or performance had not been
made. In the event that any payment, or any part thereof, is rescinded, reduced,
restored or returned, the Securities shall, to the fullest extent permitted by
law, be reinstated and deemed reduced only by such amount paid and not so
rescinded, reduced, restored or returned.
Any term or provision of any Guarantee to the contrary notwithstand
ing, the aggregate amount of the obligations guaranteed hereunder shall be
reduced to the extent necessary to prevent such Guarantee from violating or
becoming voidable under applicable law relating to fraudulent conveyance or
fraudulent transfer or similar laws affecting the rights of creditors generally.
Section 11.2 Execution and Delivery of Guarantees. The Guarantees
------------------------------------
to be endorsed on the Securities shall include the terms of the Guarantee set
forth in Section 11.1 and shall be substantially in the form established
pursuant to Section 2.1. The Guarantor hereby agrees to execute its Guarantee,
in a form established pursuant to Section 2.1, to be endorsed on each Security
authenticated and delivered by the Trustee.
The Guarantees shall be executed on behalf of the Guarantor by any one
of the Guarantor's chairman of the Board of Directors, president, executive vice
presidents, vice presidents or other person duly authorized by the Board of
Directors of the Guarantor. The signature of any or all of these persons on the
Guarantee may be manual or facsimile.
A Guarantee bearing the manual or facsimile signature of individuals
who were at any time the proper officers of the Guarantor shall bind the
Guarantor, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of the Security on
which such Guarantee is endorsed or did not hold such offices at the date of
such Guarantee.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantee endorsed
thereon on behalf of the Guarantor.
Section 11.3 Release of Guarantees. Notwithstanding anything in
---------------------
this Article 11 to the contrary, concurrently with the payment in full of (i)
the
76
principal of and premium, if any, on the Securities and (ii) all other
obligations of the Company under this Indenture, the Guarantor shall be released
from and relieved of its obligations under this Article 11. Upon the delivery by
the Company to the Trustee of an Officers' Certificate and an Opinion of Counsel
to the effect that the transaction giving rise to the release of a Guarantee was
made by the Company in accordance with the provisions of this Indenture and the
Securities, the Trustee shall execute any documents reasonably required in order
to evidence the release of the Guarantor from its obligations under such
Guarantee. If any of the obligations to pay the principal of and premium, if
any, on the Securities and all other obligations of the Company are revived and
reinstated after the termination of such Guarantee, then all of the obligations
of the Guarantor under such Guarantee shall be revived and reinstated as if such
Guarantee had not been terminated until such time as the principal of and
premium, if any, on the Securities are paid in full, and each Guaran tor shall
enter into an amendment to such Guarantee, reasonably satisfactory to the
Trustee, evidencing such revival and reinstatement.
77
ARTICLE XII
MISCELLANEOUS
Section 12.1 Trust Indenture Act Controls. If any provision of this
----------------------------
Indenture limits, qualifies, or conflicts with another provision which is
required to be included in this Indenture by the TIA, the required provision
shall control.
Section 12.2 Notices. Any request, demand, authorization, notice,
-------
waiver, consent or communication shall be in writing and delivered in person or
mailed by first-class mail, postage prepaid, addressed as follows or transmitted
by facsimile transmission (confirmed by guaranteed overnight courier) to the
following facsimile numbers:
if to the Company, to:
Tyco International Group S.A.
0 xxxxxx Xxxxx Xxxxxx
0/nd/ Floor
L-2420 Luxembourg
Attn: Managing Director
Facsimile No.: (352) 464-350
if to the Guarantor, to:
Tyco International Ltd.
The Zurich Centre, 2/nd/ Floor
00 Xxxxx Xxx Xxxx
Xxxxxxxx XX00, Xxxxxxx
Attn: Chief Corporate Counsel
Facsimile No.: (000) 000-0000
in either case, with a copy to:
Tyco International (US), Inc.
0 Xxxx 00/xx/ Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Treasurer
Facsimile No.: (000) 000-0000
if to the Trustee, to:
78
State Street Bank and Trust Company
Corporate Trust Department
0 Xxxxxx xx Xxxxxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
The Company, the Guarantor or the Trustee by notice given to the others in
the manner provided above may designate additional or different addresses for
subsequent notices or communications.
Any notice or communication given to a Securityholder shall be mailed to
the Securityholder, by first-class mail, postage prepaid, at the
Securityholder's address as it appears on the registration books of the
Registrar and shall be sufficiently given if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Securityholder or any defect
in it shall not affect its sufficiency with respect to other Securityholders.
If a notice or communication is mailed in the manner provided above, it is duly
given, whether or not received by the addressee.
If the Company mails a notice or communication to the Securityholders, it
shall mail a copy to the Trustee, the Guarantor and each Registrar, Paying
Agent, Conversion Agent or co-registrar.
Section 12.3 Communication by Holders with Other Holders.
-------------------------------------------
Securityholders may communicate pursuant to TIA Section 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Guarantor, the Trustee, the Registrar, the Paying
Agent, the Conversion Agent and anyone else shall have the protection of TIA
Section 312(c).
Section 12.4 Certificate and Opinion as to Conditions Precedent.
--------------------------------------------------
Upon any request or application by the Company or the Guarantor to the Trustee
to take any action under this Indenture, the Company or the Guarantor, as the
case may be, shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
79
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
Section 12.5 Statements Required in Certificate or Opinion. Each
---------------------------------------------
Officers' Certificate or Opinion of Counsel with respect to compliance with a
covenant or condition provided for in this Indenture shall include:
(1) a statement that each person making such Officers' Certificate or
Opinion of Counsel has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such Officers'
Certificate or Opinion of Counsel are based;
(3) a statement that, in the opinion of each such person, he has made such
examination or investigation as is necessary to enable such person to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement that, in the opinion of such person, such covenant or
condi tion has been complied with.
Section 12.6 Separability Clause. In case any provision in this
-------------------
Indenture or in the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 12.7 Rules by Trustee, Paying Agent, Conversion Agent and
----------------------------------------------------
Registrar. The Trustee may make reasonable rules for action by or a meeting of
---------
Securityholders. The Registrar, the Conversion Agent and the Paying Agent may
make reasonable rules for their functions.
Section 12.8 Legal Holidays. A "Legal Holiday" is any day other
--------------
than a Business Day. If any specified date (including a date for giving notice)
is a Legal Holiday, the action shall be taken on the next succeeding day that is
not a Legal Holiday, and, if the action to be taken on such date is a payment in
respect of the Securities, no Original Issue Discount or interest, if any, shall
accrue for the intervening period.
Section 12.9 GOVERNING LAW. THE LAWS OF THE STATE OF NEW YORK
-------------
SHALL GOVERN THIS INDENTURE, THE SECURITIES AND
80
THE GUARANTEES.
Section 12.10 No Recourse Against Others. A director, officer,
--------------------------
employee or stockholder, as such, of the Company, Tyco or the Guarantor shall
not have any liability for any obligations of the Company, Tyco or the
Guarantor, as the case may be, under the Securities, the Guarantees or this
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accept ing a Security (with a Guarantee
endorsed thereon), each Securityholder shall waive and release all such
liability. The waiver and release shall be part of the consider ation for the
issue of the Securities and the Guarantees.
Section 12.11 Successors. All agreements of the Company in this
----------
Indenture and the Securities shall bind its successor. All agreements of the
Guaran tor in this Indenture and the Guarantees shall bind its successor. All
agreements of Tyco in this Indenture shall bind its successor. All agreements
of the Trustee in this Indenture shall bind its successor.
Section 12.12 Multiple Originals. The parties may sign any number of
------------------
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.
Section 12.13 Submission to Jurisdiction. By the execution and
--------------------------
delivery of this Indenture, each of the Company and the Guarantor (i)
acknowledges that as of the date hereof it has, by separate instrument,
irrevocably designated and appointed CT Corporation System, 0000 Xxxxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 as its authorized agent upon which process may be served in
any suit or proceeding arising out of or relating to the Securities, the
Guarantees, the Common Shares, this Indenture, or the Registration Rights
Agreement that may be instituted in any federal or New York State court located
in the City of New York, and acknowledges that CT Corporation System has
accepted such designation, (ii) submits to the non-exclusive jurisdiction of any
such court in any such suit or proceeding, and (iii) agrees that service of
process upon CT Corporation System and written notice of said service to the
Company or the Guarantor, as the case may be (mailed or delivered to the address
set forth in Section 12.2 hereof), shall be deemed in every respect effective
service upon the Company or the Guarantor, respectively, in any such suit or
proceeding. Each of the Company and the Guarantor further agrees to take any and
all action, including the execution and filing of any and all such documents and
instruments, as may be necessary to continue such designation and appointment of
CT Corporation System in full force and effect so long as this Indenture shall
be in full force and effect.
81
Each of the Company and the Guarantor hereby irrevocably and
unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of
any suit, action or proceeding arising out of or relating to this Indenture in
any New York State or federal court in the City of New York, or any appellate
court with respect to any of the foregoing. Each of the Company and the
Guarantor hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
82
IN WITNESS WHEREOF, the undersigned, being duly authorized, have
executed this Indenture on behalf of the respective parties hereto as of the
date first above written.
TYCO INTERNATIONAL GROUP S.A.
By: ________________________________________
Name:
Title:
TYCO INTERNATIONAL LTD.
By: ________________________________________
Name:
Title:
STATE STREET BANK AND TRUST COMPANY
By: ________________________________________
Name:
Title:
EXHIBIT A-1
-----------
[FORM OF FACE OF GLOBAL SECURITY]
FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE INTERNAL REVENUE CODE, THE AMOUNT
OF ORIGINAL ISSUE DISCOUNT WITH RESPECT TO EACH $1,000 OF PRINCIPAL AMOUNT AT
MATURITY OF THIS SECURITY IS $741.65, THE ISSUE DATE IS FEBRUARY 12, 2001, AND
THE YIELD TO MATURITY IS 1.50% PER ANNUM.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO TYCO INTERNATIONAL GROUP S.A. (THE "COMPANY")
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY
(AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONG FUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS TO
NOMINEES OF THE DEPOSITORY TRUST COMPANY, OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
ARTICLE TWO OF THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933 (THE "SECURITIES ACT"), AND THIS SECURITY, THE GUARANTEE ENDORSED HEREON
AND THE COM MON SHARES DELIVERABLE UPON CONVERSION OF THIS SECURITY OR UPON
PURCHASE OF THIS SECURITY BY THE COMPANY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
A-1-1
THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF
THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PRO VIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY MAY BE OFFERED, RE SOLD, PLEDGED OR OTHERWISE TRANSFERRED,
ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE
UNITED STATES IN A TRANSACTION COMPLYING WITH THE PROVISIONS OF RULE 904 UNDER
THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM REGIS TRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THERE UNDER (IF AVAILABLE) OR (IV) PURSUANT
TO AN EFFECTIVE REGIS TRATION STATEMENT UNDER THE SECURITIES ACT IN EACH OF
CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER
IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE
RESTRIC TIONS REFERRED TO IN (A) ABOVE.
THE FOREGOING LEGEND MAY BE REMOVED FROM THIS SECURITY ON SATISFACTION
OF THE CONDITIONS SPECIFIED IN THE INDENTURE.
TYCO INTERNATIONAL GROUP S.A.
Zero Coupon Convertible Debentures due February 12, 2021
No. CUSIP:
Issue Date: February 12, 2001 Original Issue Discount: $258.35
(for each $1,000 Principal Amount
Issue Price: $741.65 at Maturity)
(for each $1,000 Principal Amount at
Maturity)
A-1-2
TYCO INTERNATIONAL GROUP S.A., a Luxembourg company, promises to pay to
Cede & Co. or registered assigns, the Principal Amount at Maturity of
[ ($ )] on February 12, 2021.
This Security shall not bear interest except as specified on the other side
of this Security. Original Issue Discount will accrue as specified on the other
side of this Security. This Security is convertible as specified on the other
side of this Security.
Additional provisions of this Security are set forth on the other side of
this Security.
Dated: TYCO INTERNATIONAL GROUP S.A.
By: __________________________________
Title: _________________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
STATE STREET BANK AND TRUST COMPANY, as Trustee, certifies that this is one of
the Securities referred to in the within-mentioned Indenture.
By: __________________________________
Authorized Signatory
Dated:
GUARANTEE
For value received, TYCO INTERNATIONAL LTD. hereby absolutely,
unconditionally and irrevocably guarantees to the holder of this Security the
payment of principal of, premium, if any, and Additional Amounts in respect of
the Security upon which this Guarantee is endorsed in the amounts and at the
times when due and payable whether by declaration thereof, or otherwise, and
interest on the overdue principal and interest, if any, of such Security, if
lawful, and the payment or performance of all other obligations of the Company
under the Indenture or the Securities, to the holder of such Security and the
Trustee, all in accordance with and subject to the terms and limitations of such
Security and Article 11 of the Indenture.
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This Guarantee will not become effective until the Trustee duly executes the
certificate of authentication on this Security. This Guarantee shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to the conflict of law principles thereof.
Dated: TYCO INTERNATIONAL LTD.
By: __________________________________
Title: _________________________________
A-1-4
[FORM OF REVERSE SIDE OF DEBENTURE]
Zero Coupon Convertible Debentures due February 12, 2021
1. Interest.
This Security shall not bear interest. If the Principal Amount at
Maturity hereof or any portion of such Principal Amount at Maturity is not paid
when due (whether upon acceleration pursuant to Section 6.2 of the Indenture,
upon the date set for payment of the Redemption Price pursuant to paragraph 5
hereof, upon the date set for payment of the Purchase Price or Change in Control
Purchase Price pursuant to paragraph 6 hereof or upon the Stated Maturity of
this Security), then in each such case the overdue amount shall, to the extent
permitted by law, bear interest at the rate of 1.50 % per annum, compounded
semiannually, which interest shall accrue from the date such overdue amount was
originally due to the date payment of such amount, including interest thereon,
has been made or duly provided for. All such interest shall be payable on
demand.
Original Issue Discount (the difference between the Issue Price and
the Principal Amount at Maturity of the Security), in the period during which a
Security remains outstanding, shall accrue at 1.50% per annum, on a semiannual
bond equivalent basis using a 360-day year composed of twelve 30-day months,
from the Issue Date of this Security.
2. Method of Payment.
Subject to the terms and conditions of the Indenture, the Company will
make payments in respect of Redemption Prices, Purchase Prices, Change in
Control Purchase Prices and at Stated Maturity to Holders who surrender
Securities to a Paying Agent to collect such payments in respect of the
Securities. The Com pany will pay cash amounts in money of the United States
that at the time of payment is legal tender for payment of public and private
debts. However, the Company may make such cash payments by check payable in such
money.
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3. Paying Agent, Conversion Agent and Registrar.
Initially, State Street Bank and Trust Company (the "Trustee") will
act as Paying Agent, Conversion Agent and Registrar. The Company may appoint and
change any Paying Agent, Conversion Agent or Registrar without notice, other
than notice to the Trustee; provided that the Company will maintain at least one
Paying Agent in the State of New York, City of New York, Borough of Manhattan,
which shall initially be an office or agency of the Trustee. The Company or any
of its Subsidiaries or any of their Affiliates may act as Paying Agent,
Conversion Agent or Registrar.
4. Indenture.
The Company issued the Securities under an Indenture dated as of
February 12, 2001 (the "Indenture"), among the Company, Tyco International Ltd.
and the Trustee. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as in effect from time to time (the "TIA"). Capitalized
terms used herein and not defined herein have the meanings ascribed thereto in
the Indenture. The Securities are subject to all such terms, and Securityholders
are referred to the Indenture and the TIA for a statement of those terms.
The Securities are general unsecured obligations of the Company
limited to $3,490,250,000 aggregate Principal Amount at Maturity (subject to
Section 2.7 of the Indenture). The Indenture does not limit other indebtedness
of the Company, secured or unsecured.
5. Redemption at the Option of the Company.
No sinking fund is provided for the Securities. The Securities are
redeemable as a whole, or from time to time in part, at any time at the option
of the Company at the Redemption Prices set forth below, provided that the
Securities are not redeemable prior to February 12, 2009.
The table below shows Redemption Prices of a Security per $1,000
Principal Amount at Maturity on the dates shown below and at Stated Maturity,
which prices reflect accrued Original Issue Discount calculated to each such
date. The Redemption Price of a Security redeemed between such dates shall
include an additional amount reflecting the additional Original Issue Discount
accrued since the next preceding date in the table.
A-1-6
(2)
(1) Accrued (3)
Debenture Original Issue Redemption
Issue Discount at Price
Redemption Date Price 1.50% (1) + (2)
------------------ ----------- ---------------- ------------
February 12, 2009 741.65 94.18 835.83
February 12, 2010 741.65 106.77 848.42
February 12, 2011 741.65 119.54 861.19
February 12, 2012 741.65 132.51 874.16
February 12, 2013 741.65 145.67 887.32
February 12, 2014 741.65 159.03 900.68
February 12, 2015 741.65 172.59 914.24
February 12, 2016 741.65 186.36 928.01
February 12, 2017 741.65 200.33 941.98
February 12, 2018 741.65 214.51 956.16
February 12, 2019 741.65 228.91 970.56
February 12, 2020 741.65 243.52 985.17
At Stated Maturity 741.65 258.35 1,000.00
6. Purchase By the Company at the Option of the Holder.
Subject to the terms and conditions of the Indenture, the Company
shall become obligated to purchase, at the option of the Holder, all or any
portion of the Securities held by such Holder in integral multiples of $1,000
Principal Amount at Maturity on the following Purchase Dates and at the
following Purchase Prices per $1,000 Principal Amount at Maturity, upon delivery
of a Purchase Notice containing the information set forth in the Indenture, at
any time from the opening of business on the date that is 20 Business Days prior
to such Purchase Date until the close of business on the fifth Business Day
prior to such Purchase Date, and upon delivery of the Securities to the Paying
Agent by the Holder as set forth in the Indenture.
Purchase Price Purchase Price
----------------- --------------
February 12, 2003 $764.15
February 12, 2005 $787.33
February 12, 2007 $811.22
February 12, 2009 $835.83
February 12, 2016 $928.01
The Purchase Price for the February 12, 2003 purchase (equal to the
Issue Price plus accrued Original Issue Discount to the Purchase Date) may be
paid, at the option of the Company, in cash or by the delivery of Common Shares
of Tyco,
A-1-7
or in any combination thereof.
At the option of the Holder and subject to the terms and conditions of
the Indenture, the Company shall become obligated to purchase the Securities
held by such Holder 35 Business Days after the occurrence of a Change in Control
of the Company occurring on or prior to February 12, 2009 for a Change in
Control Purchase Price equal to the Issue Price plus accrued Original Issue
Discount to the Change in Control Purchase Date, which Change in Control
Purchase Price shall be paid in cash.
Holders have the right to withdraw any Purchase Notice or Change in
Control Purchase Notice, as the case may be, by delivering to the Paying Agent a
written notice of withdrawal in accordance with the provisions of the Indenture.
If cash (and/or securities if permitted under the Indenture)
sufficient to pay the Purchase Price or Change in Control Purchase Price, as the
case may be, of all Securities or portions thereof to be purchased as of the
Purchase Date or the Change in Control Purchase Date, as the case may be, is
deposited with the Paying Agent on the Business Day following the Purchase Date
or the Change in Control Purchase Date, Original Issue Discount ceases to accrue
on such Securities (or portions thereof) immediately after such Purchase Date or
Change in Control Purchase Date, and the Holder thereof shall have no other
rights as such other than the right to receive the Purchase Price or Change in
Control Purchase Price upon surrender of such Security.
7. Notice of Redemption.
Notice of redemption pursuant to paragraph 5 of this Security will be
mailed at least 15 days but not more than 60 days before the Redemption Date to
each Holder of Securities to be redeemed at the Holder's registered address. If
money sufficient to pay the Redemption Price of all Securities (or portions
thereof) to be redeemed on the Redemption Date is deposited with the Paying
Agent prior to or on the Redemption Date, immediately after such Redemption Date
Original Issue Discount ceases to accrue on such Securities or portions thereof.
Securities in denominations larger than $1,000 of Principal Amount at Maturity
may be redeemed in part but only in integral multiples of $1,000 of Principal
Amount at Maturity.
8. Conversion.
Holders may surrender Securities for conversion into Common Shares on
a Conversion Date if, as of such Conversion Date, the Sale Price (as defined in
the Indenture) of the Common Shares for at least 20 trading days in the 30
trading day period ending on the trading day prior to the Conversion Date is
more than 110% of
A-1-8
the accreted conversion price of a Security with a $1,000 Principal Amount at
Maturity on such Conversion Date. The accreted conversion price is equal to the
Issue Price plus accrued Original Issue Discount of such Security, with the sum
thereof divided by the Conversion Rate. In addition, a Holder may surrender for
conversion a Security or portion of a Security which has been called for
redemption pursuant to paragraph 5 hereof, even if the foregoing provision has
not been satisfied, and such Securities may be surrendered for conversion until
the close of business on the day that is two Business Days prior to the
Redemption Date. In the event that Tyco declares a dividend or distribution
described in Section 10.7 of the Indenture, or a dividend or a distribution
described in Section 10.8 of the Indenture where the fair market value of such
dividend or distribution per Common Share, as determined in the Indenture,
exceeds 15% of the Sale Price of the Common Shares as of the Business Day prior
to the date of declaration, the Securities may be surrendered for conversion
beginning on the date the Company gives notice to the Holders of such right,
which shall be not less than 20 days prior to the Ex-Dividend Time for such
dividend or distribution and Securities may be surrendered for conversion at any
time thereafter until the close of business on the Business Day prior to the Ex-
Dividend Time or until Tyco announces that such distribution will not take
place. Finally, in the event that Tyco is a party to a consolidation, merger or
binding share exchange pursuant to which the Common Shares would be converted
into cash, securities or other property as set forth in Section 10.14 of the
Indenture, the Securities may be surrendered for conversion at any time from and
after the date which is 15 days prior to the date Tyco announces as the
anticipated effective time until 15 days after the actual date of such
transaction.
A Security in respect of which a Holder has delivered a Purchase
Notice or Change in Control Purchase Notice exercising the option of such Holder
to require the Company to purchase such Security may be converted only if such
notice of exercise is withdrawn in accordance with the terms of the Indenture.
The initial Conversion Rate is 8.6916 Common Shares per $1,000
Principal Amount at Maturity, subject to adjustment in certain events described
in the Indenture. A Holder which surrenders Securities for conversion will
receive cash or a check in lieu of any fractional Common Share.
In certain circumstances described in the Indenture, a Holder which
surrenders Securities for conversion may receive Common Shares and cash in lieu
of fractional shares from an Exchange Party and not from the Company and the
Securi ties may remain outstanding.
To surrender a Security for conversion, a Holder must (1) complete and
manually sign the conversion notice below (or complete and manually sign a
facsimile of such notice) and deliver such notice to the Conversion Agent, (2)
A-1-9
surrender the Security to the Conversion Agent, (3) furnish appropriate
endorsements and transfer documents and (4) pay any transfer or similar tax, if
required.
A Holder may convert a portion of a Security if the Principal Amount
at Maturity of such portion is $1,000 or an integral multiple of $1,000. No
payment or adjustment will be made for dividends on the Common Shares except as
provided in the Indenture. On conversion of a Security, that portion of accrued
Original Issue Discount attributable to the period from the Issue Date through
the Conversion Date with respect to the converted Security shall not be
cancelled, extinguished or forfeited, but rather shall be deemed to be paid in
full to the Holder thereof through the delivery of the Common Shares (together
with the cash payment, if any, in lieu of fractional shares) in exchange for the
Security being converted pursuant to the terms hereof; and the fair market value
of such shares of Common Shares (together with any such cash payment in lieu of
fractional shares) shall be treated as issued, to the extent thereof, first in
exchange for Original Issue Discount accrued through the Conversion Date, and
the balance, if any, of such fair market value of such Common Shares (and any
such cash payment) shall be treated as issued in exchange for the Issue Price of
the Security being converted pursuant to the provisions hereof.
The Conversion Rate will be adjusted for dividends or distributions on
Common Shares payable in Common Shares or other Capital Stock; subdivisions,
combinations or certain reclassifications of Common Shares; distributions to all
holders of Common Shares of certain rights to purchase Common Shares for a
period expiring within 60 days at less than the Average Sale Price at the Time
of Determina tion; and distributions to such holders of assets or debt
securities of Tyco or certain rights to purchase securities of Tyco (excluding
certain cash dividends or distribu tions). However, no adjustment need be made
if Securityholders may participate in the transaction without conversion or in
certain other cases. The Company from time to time may voluntarily increase the
Conversion Rate.
If Tyco is a party to a consolidation, merger or binding share
exchange or a transfer of all or substantially all of its assets, or upon
certain distributions described in the Indenture, the right to convert a
Security into Common Shares may be changed into a right to convert it into
securities, cash or other assets of Tyco or another person.
9. Conversion Arrangement on Call for Redemption.
Any Securities called for redemption, unless surrendered for conver
sion before the close of business on the day that is two Business Days prior to
the Redemption Date, may be deemed to be purchased from the Holders of such
Securi ties at an amount not less than the Redemption Price, by one or more
investment bankers or other purchasers who may agree with the Company to
purchase such
A-1-10
Securities from the Holders, to convert them into Common Shares of Tyco and to
make payment for such Securities to the Trustee in trust for such Holders.
10. Denominations; Transfer; Exchange.
The Securities are in fully registered form, without coupons, in
denominations of $1,000 of Principal Amount at Maturity and integral multiples
of $1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not transfer
or exchange any Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security not to be redeemed)
or any Securities in respect of which a Purchase Notice or Change in Control
Purchase Notice has been given and not withdrawn (except, in the case of a
Security to be purchased in part, the portion of the Security not to be
purchased) or any Securities for a period of 15 days before the mailing of a
notice of redemption of Securities to be redeemed.
11. Persons Deemed Owners.
The registered Holder of this Security may be treated as the owner of
this Security for all purposes.
12. Unclaimed Money or Securities.
The Trustee and the Paying Agent shall return to the Company or the
Guarantor, as the case may be, upon written request any money or securities held
by them for the payment of any amount with respect to the Securities that
remains unclaimed for two years, subject to applicable unclaimed property law.
After return to the Company or the Guarantor, as the case may be, Holders
entitled to the money or securities must look to the Company or the Guarantor,
respectively, for payment as general creditors unless an applicable abandoned
property law designates another person.
13. Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the
Inden ture, the Securities or the Guarantees may be amended with the written
consent of the Holders of at least a majority in aggregate Principal Amount at
Maturity of the Securities at the time outstanding and (ii) certain Defaults may
be waived with the written consent of the Holders of a majority in aggregate
Principal Amount at Maturity of the Securities at the time outstanding. Subject
to certain exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company, the
A-1-11
Guarantor and the Trustee may amend the Indenture, the Securities or the
Guarantees so long as such changes, other that those in clause (ii), do not
materially and ad versely affect the interest of Securityholders (i) to cure any
ambiguity, omission, defect or inconsistency, (ii) to comply with Article 5 or
Section 10.14 of the Inden ture, (iii) to add to the covenants of the Company or
the Guarantor for the benefit of Securityholders or to secure the Company's
obligations under the Securities and this Indenture, or (iv) to comply with any
requirement of the SEC in connection with the qualification of the Indenture
under the TIA.
14. Defaults and Remedies.
Under the Indenture, Events of Default include (i) default in payment
of the Principal Amount at Maturity, Issue Price plus accrued Original Issue Dis
count, Redemption Price, Purchase Price or Change in Control Purchase Price, as
the case may be, in respect of the Securities when the same becomes due and
payable, (ii) failure by the Company or the Guarantor to comply with other
agreements in the Indenture or the Securities, subject to notice and lapse of
time; (iii) default by the Company or the Guarantor in the payment at the final
maturity thereof, after the expiration of any applicable grace period, of
principal of or interest on indebtedness for money borrowed, other than non-
recourse indebtedness, in the principal amount then outstanding of $50 million
or more, or acceleration of any indebtedness in such principal amount so that it
becomes due and payable prior to the date on which it would otherwise have
become due and payable and such acceleration is not rescinded within 10 business
days after notice to the Company or the Guarantor, as the case may be, in
accordance with the Indenture; (iv) any Guarantee shall for any reason cease to
be in full force and effect and enforceable in accordance with its terms; and
(v) certain events of bankruptcy or insolvency.
Securityholders may not enforce the Indenture or the Securities except
as provided in the Indenture. The Trustee may refuse to enforce the Indenture
or the Securities unless it receives reasonable indemnity or security. Subject
to certain limitations, Holders of a majority in aggregate Principal Amount at
Maturity of the Securities at the time outstanding may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Securityholders
notice of any continuing Default (except a Default in payment of amounts
specified in clause (i) above) if it determines that withholding notice is in
their interests.
15. Trustee Dealings with the Company and Guarantor.
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it
A-1-12
by the Company, the Guarantor or their Affiliates and may otherwise deal
with the Company, the Guarantor or their Affiliates with the same rights it
would have if it were not Trustee.
16. No Recourse Against Others.
A director, officer, employee or shareholder, as such, of the Company
or the Guarantor shall not have any liability for any obligations of the Company
or the Guarantor, respectively, under the Securities, the Indenture or the
Guarantees or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Security (with a Guarantee
endorsed thereon), each Securityholder waives and releases all such liability.
The waiver and release are part of the consideration for the issue of the
Securities and the Guarantees.
17. Authentication.
This Security shall not be valid until an authorized signatory of the
Trustee manually signs the Trustee's Certificate of Authentication on the other
side of this Security.
18. Guarantees.
The payment and performance of all obligations of the Company under
the Indenture and this Security are fully and unconditionally guaranteed to the
holder of this Security by the Guarantor, as provided in the related Guarantee
and the Indenture.
19. Abbreviations.
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM ("tenants in common"), TEN ENT ("tenants by the
entireties"), JT TEN ("joint tenants with right of survivorship and not as
tenants in common"), CUST ("custodian") and U/G/M/A ("Uniform Gift to Minors
Act").
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20. GOVERNING LAW.
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE AND THIS
SECURITY (AND THE GUARANTEE ENDORSED HEREON).
The Company will furnish to any Securityholder upon written request
and without charge a copy of the Indenture which has in it the text of this
Security in larger type. Requests may be made to:
Tyco International Group S.A.
0 xxxxxx Xxxxx Xxxxxx
0/nd/ Floor
L-2420 Luxembourg
Attn: Managing Director
Facsimile No.: (352) 464-350
A-1-14
ASSIGNMENT FORM CONVERSION NOTICE
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To assign this Security, fill in the To convert this Security into Common
form below: Shares of Tyco, check the box [ ]
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I or we assign and transfer this To convert only part of this
Security to Security, state the Principal
_________________________ Amount at Maturity to be converted
(which must be $1,000 or an
_________________________ integral multiple of $1,000):
(Insert assignee's soc. sec. or tax ID
no.)
_________________________ If you want the stock certificate
_________________________ made out in another person's name
_________________________ fill in the form below:
(Print or type assignee's name, address _________________________
and zip code) _________________________
(Insert the other person's soc.
and irrevocably appoint sec. tax ID no.
____________________ agent to
transfer this Security on the books of __________________________
the Company. The agent may substitute __________________________
another to act for him. __________________________
__________________________
__________________________
(Print or type other person's name,
address and zip code)
-------------------------------------------------------------------------------
Date: __________ Your Signature: ___________________________________
______________________________________________________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guaranteed
------------------------------------
Participant in a Recognized Signature
Guarantee Medallion Program
By: _____________________________________
Authorized Signatory
A-1-15
EXHIBIT A-2
-----------
[Form of Certificated Security]
FOR PURPOSES OF SECTIONS 1273 AND 1275 OF THE INTERNAL REVENUE CODE, THE AMOUNT
OF ORIGINAL ISSUE DISCOUNT WITH RESPECT TO EACH $1,000 OF PRINCIPAL AMOUNT AT
MATURITY OF THIS SECURITY IS $741.65, THE ISSUE DATE IS FEBRUARY 12, 2001, AND
THE YIELD TO MATURITY IS 1.50% PER ANNUM.
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933 (THE "SECURITIES ACT"), AND THIS SECURITY, THE GUARANTEE ENDORSED HEREON
AND THE COMMON SHARES DELIVERABLE UPON CONVERSION OF THIS SECURITY OR UPON
PURCHASE OF THIS SECURITY BY THE COMPANY MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF
THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PRO VIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY MAY BE OFFERED, RE SOLD, PLEDGED OR OTHERWISE TRANSFERRED,
ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE
UNITED STATES IN A TRANSACTION COMPLYING WITH THE PROVISIONS OF RULE 904 UNDER
THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM REGIS TRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THERE UNDER (IF AVAILABLE) OR (IV) PURSUANT
TO AN EFFECTIVE REGIS TRATION STATEMENT UNDER THE SECURITIES ACT IN EACH OF
CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER
IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE
RESTRIC TIONS REFERRED TO IN (A) ABOVE.
A-2-1
THE FOREGOING LEGEND MAY BE REMOVED FROM THIS SECURITY ON SATISFACTION
OF THE CONDITIONS SPECIFIED IN THE INDENTURE.
TYCO INTERNATIONAL GROUP S.A.
Zero Coupon Convertible Debentures due February 12, 2021
No. CUSIP:
Issue Date: February 12, 2001 Original Issue Discount: $258.35
Issue Price: $741.65 (for each $1,000 Principal Amount
(for each $1,000 Principal Amount at Maturity)
at Maturity)
TYCO INTERNATIONAL GROUP S.A., a Luxembourg company, promises to pay
to Cede & Co. or registered assigns, the Principal Amount at Maturity of [
($ ) on February 12, 2021.]
This Security shall not bear interest except as specified on the other
side of this Security. Original Issue Discount will accrue as specified on the
other side of this Security. This Security is convertible as specified on the
other side of this Security.
Additional provisions of this Security are set forth on the other side
of this Security.
Dated: TYCO INTERNATIONAL GROUP S.A.
By: _______________________
Title:
A-2-2
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
STATE STREET BANK AND TRUST COMPANY,
as Trustee, certifies that this
is one of the Securities referred
to in the within-mentioned Indenture.
By ________________________
Authorized Signatory
Dated:
GUARANTEE
For value received, TYCO INTERNATIONAL LTD. hereby absolutely,
unconditionally and irrevocably guarantees to the holder of this Security the
payment of principal of, premium, if any, and Additional Amounts in respect of
the Security upon which this Guarantee is endorsed in the amounts and at the
time when due and payable whether by declaration thereof, or otherwise, and
interest on the overdue principal and interest, if any, of such Security, if
lawful, and the payment or performance of all other obligations of the Company
under the Indenture or the Securities, to the holder of such Security and the
Trustee, all in accordance with and subject to the terms and limitations of such
Security and Article 11 of the Indenture. This Guarantee will not become
effective until the Trustee duly executes the certificate of authentication on
this Security. This Guarantee shall be governed by and construed in accordance
with the laws of the State of New York, without regard to the conflict of law
principles thereof.
Dated: TYCO INTERNATIONAL LTD.
By: __________________________________
Title:_________________________________
A-2-3
[FORM OF REVERSE SIDE IS IDENTICAL TO EXHIBIT A-1]
A-2-4
EXHIBIT B
---------
Transfer Certificate
In connection with any transfer of any of the Securities within the
period prior to the expiration of the holding period applicable to the sales
thereof under Rule 144(k) under the Securities Act of 1933, as amended (the
"Securities Act") (or any successor provision), the undersigned registered owner
of this Security hereby certifies with respect to $____________ Principal Amount
at Maturity of the above-captioned Securities presented or surrendered on the
date hereof (the "Surrendered Securities") for registration of transfer, or for
exchange or conversion where the securities deliverable upon such exchange or
conversion are to be registered in a name other than that of the undersigned
registered owner (each such transaction being a "transfer"), that such transfer
complies with the restrictive legend set forth on the face of the Surrendered
Securities for the reason checked below:
[_] A transfer of the Surrendered Securities is made to the
Company or any subsidiaries; or
[_] The transfer of the Surrendered Securities complies with Rule
144A under the U.S. Securities Act of 1933, as amended (the
"Securities Act"); or
[_] The transfer of the Surrendered Securities is being made to a
purchaser who is not a U.S. person (as defined in Regulation
S under the Securities Act) in an offshore transaction
pursuant to Regulation S under the Securities Act; or
[_] The transfer of the Surrendered Securities is pursuant to an
effective registration statement under the Securities Act, or
[_] The transfer of the Surrendered Securities is pursuant to
another available exemption from the registration requirement
of the Securities Act.
and unless the box below is checked, the undersigned confirms that, to
the undersigned's knowledge, such Securities are not being transferred to an
"affiliate" of the Company as defined in Rule 144 under the Securities Act (an
"Affiliate").
B-1-1
[_] The transferee is an Affiliate of the Company.
DATE: __________________________________
Signature(s)
(If the registered owner is a corporation, partnership or fiduciary,
the title of the Person signing on behalf of such registered owner must be
stated.)
Signature Guaranteed
_____________________________________
Participant in a Recognized Signature
Guarantee Medallion Program
By: _____________________________
Authorized Signatory
B-1-2
