EXHIBIT 4.4
VENTRO CORPORATION,
AS ISSUER,
and
[STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A.,]
AS TRUSTEE
INDENTURE
DATED AS OF_______________ ___, 2000
_____% CONVERTIBLE SUBORDINATED NOTES DUE 2007
TABLE OF CONTENTS
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ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions............................................. 1
SECTION 1.02. Compliance Certificates and Opinions.................... 9
SECTION 1.03. Form of Documents Delivered to the Trustee.............. 9
SECTION 1.04. Acts of Holders of Securities........................... 10
SECTION 1.05. Notices, Etc., to Trustee and the Company............... 12
SECTION 1.06. Notice to Holders of Securities; Waiver................. 13
SECTION 1.07. Effect of Headings and Table of Contents................ 13
SECTION 1.08. Successors and Assigns.................................. 13
SECTION 1.09. Separability Clause..................................... 13
SECTION 1.10. Benefits of Indenture................................... 13
SECTION 1.11. Governing Law........................................... 14
SECTION 1.12. Legal Holidays.......................................... 14
SECTION 1.13. Conflict with Trust Indenture Act....................... 14
SECTION 1.14. Indenture and Securities Solely Corporate Obligations... 14
ARTICLE 2
SECURITY FORMS
SECTION 2.01. Forms Generally......................................... 15
SECTION 2.02. Form of Security........................................ 15
SECTION 2.03. Form of Election of Holder to Require Repurchase........ 23
SECTION 2.04. Form of Conversion Notice............................... 24
SECTION 2.05. Form of Certificate of Authentication................... 25
ARTICLE 3
THE SECURITIES
SECTION 3.01. Title and Terms......................................... 25
SECTION 3.02. Denominations........................................... 26
SECTION 3.03. Execution, Authentication, Delivery and Dating.......... 26
SECTION 3.04. Registration of Transfer and Exchange; Restrictions on
Transfer.............................................................. 28
SECTION 3.05. Temporary Securities.................................... 30
SECTION 3.06. Mutilated, Destroyed, Lost or Stolen Securities......... 30
SECTION 3.07. Payment of Interest; Interest Rights Preserved.......... 31
SECTION 3.08. Persons Deemed Owners................................... 33
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SECTION 3.09. Cancellation............................................ 33
SECTION 3.10. Computation of Interest................................. 33
SECTION 3.11. CUSIP Numbers........................................... 33
ARTICLE 4
SATISFACTION AND DISCHARGE
SECTION 4.01. Satisfaction and Discharge of Indenture................. 34
SECTION 4.02. Application of Trust Money.............................. 35
ARTICLE 5
REMEDIES
SECTION 5.01. Events of Default....................................... 35
SECTION 5.02. Acceleration of Maturity; Rescission and Annulment...... 36
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by
Trustee............................................................... 37
SECTION 5.04. Trustee May File Proofs of Claim........................ 38
SECTION 5.05. Trustee May Enforce Claims Without Possession of
Securities............................................................ 39
SECTION 5.06. Application of Money Collected.......................... 39
SECTION 5.07. Limitation on Suits..................................... 40
SECTION 5.08. Unconditional Right of Holders to Receive Principal,
Redemption Price, Fundamental Change Redemption Price
and Interest and to Convert........................................... 40
SECTION 5.09. Restoration of Rights and Remedies...................... 41
SECTION 5.10. Rights and Remedies Cumulative.......................... 41
SECTION 5.11. Delay or Omission Not Waiver............................ 41
SECTION 5.12. Control by Holders of Securities........................ 41
SECTION 5.13. Waiver of Past Defaults................................. 42
SECTION 5.14. Undertaking for Costs................................... 42
SECTION 5.15. Waiver of Stay, Extension and Usury Laws................ 42
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ARTICLE 6
THE TRUSTEE
SECTION 6.01. Certain Duties and Responsibilities........................ 43
SECTION 6.02. Notice of Defaults......................................... 44
SECTION 6.03. Certain Rights of Trustee.................................. 44
SECTION 6.04. Not Responsible for Recitals or Issuance of Securities..... 45
SECTION 6.05. May Hold Securities, Act as Trustee Under Other
Indentures............................................................... 45
SECTION 6.06. Money Held in Trust........................................ 45
SECTION 6.07. Compensation and Reimbursement............................. 46
SECTION 6.08. Corporate Trustee Required; Eligibility.................... 46
SECTION 6.09. Resignation and Removal; Appointment of Successor.......... 47
SECTION 6.10. Acceptance of Appointment by Successor..................... 48
SECTION 6.11. Merger, Conversion, Consolidation or Succession to
Business................................................................. 48
SECTION 6.12. Authenticating Agents...................................... 49
SECTION 6.13. Disqualification; Conflicting Interest..................... 50
SECTION 6.14. Preferential Collection of the Claims Against the Company.. 50
ARTICLE 7
CONSOLIDATION, MERGER, TRANSFER OR LEASE
SECTION 7.01. The Company May Consolidate, Etc., Only on Certain Terms... 50
SECTION 7.02. Successor Substituted...................................... 51
ARTICLE 8
SUPPLEMENTAL INDENTURES
SECTION 8.01. Supplemental Indentures Without Consent of Holders of
Securities.............................................................. 51
SECTION 8.02. Supplemental Indentures with Consent of Holders of
Securities............................................................... 52
SECTION 8.03. Execution of Supplemental Indentures....................... 53
SECTION 8.04. Effect of Supplemental Indentures.......................... 53
SECTION 8.05. Reference in Securities to Supplemental Indentures......... 53
SECTION 8.06. Notice of Supplemental Indentures.......................... 53
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ARTICLE 9
MEETINGS OF HOLDERS OF SECURITIES
SECTION 9.01. Purposes for Which Meetings May Be Called................ 54
SECTION 9.02. Call, Notice and Place of Meetings....................... 54
SECTION 9.03. Persons Entitled to Vote at Meetings..................... 54
SECTION 9.04. Quorum; Action........................................... 54
SECTION 9.05. Determination of Voting Rights; Conduct and Adjournment
of Meetings............................................................ 55
SECTION 9.06. Counting Votes and Recording Action of Meetings.......... 56
ARTICLE 10
COVENANTS
SECTION 10.01. Payment of Principal, Redemption Price, Fundamental
Change Redemption Price and Interest................................... 56
SECTION 10.02. Maintenance of Offices or Agencies...................... 56
SECTION 10.03. Money for Security Payments to Be Held in Trust......... 57
SECTION 10.04. Corporate Existence..................................... 58
SECTION 10.05. Statement by Officers as to Default..................... 58
ARTICLE 11
REDEMPTION OF SECURITIES
SECTION 11.01. Right of Redemption..................................... 59
SECTION 11.02. Applicability of Article................................ 59
SECTION 11.03. Selection to Redeem; Notice to Trustee.................. 59
SECTION 11.04. Selection by Trustee of Securities to Be Redeemed....... 59
SECTION 11.05. Notice of Redemption.................................... 60
SECTION 11.06. Deposit of Redemption Price............................. 60
SECTION 11.07. Securities Payable on Redemption Date................... 61
SECTION 11.08. Securities Redeemed in Part............................. 61
SECTION 11.09. Conversion Arrangement on Call for Redemption........... 61
SECTION 11.10. No Sinking Fund......................................... 62
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ARTICLE 12
CONVERSION OF SECURITIES
SECTION 12.01. Conversion Privilege and Conversion Price.................. 62
SECTION 12.02. Exercise of Conversion Privilege........................... 63
SECTION 12.03. Fractions of Shares........................................ 64
SECTION 12.04. Adjustment of Conversion Price............................. 64
SECTION 12.05. Notice of Adjustments of Conversion Price.................. 72
SECTION 12.06. Notice of Certain Corporate Action......................... 72
SECTION 12.07. Company to Provide Common Stock............................ 73
SECTION 12.08. Taxes on Conversions....................................... 74
SECTION 12.09. Company Covenant as to Common Stock........................ 74
SECTION 12.10. Cancellation of Converted Securities....................... 74
SECTION 12.11. Effect of Reclassification, Consolidation, Merger or Sale.. 74
SECTION 12.12. Responsibility of Trustee for Conversion Provisions........ 75
ARTICLE 13
SUBORDINATION OF SECURITIES
SECTION 13.01. Agreement of Subordination................................. 75
SECTION 13.02. Payments to Holders........................................ 76
SECTION 13.03. Subrogation of Securities.................................. 79
SECTION 13.04. Authorization to Effect Subordination...................... 79
SECTION 13.05. Notice to Trustee.......................................... 80
SECTION 13.06. Trustee's Relation to Senior Indebtedness.................. 80
SECTION 13.07. No Impairment of Subordination............................. 81
SECTION 13.08. Article Applicable to Paying Agents........................ 81
SECTION 13.09. Senior Indebtedness Entitled to Rely....................... 81
SECTION 13.10. Certain Conversions Deemed Payment......................... 81
ARTICLE 14
REPURCHASE OF SECURITIES AT THE OPTION OF THE HOLDERS UPON A
FUNDAMENTAL CHANGE
SECTION 14.01. Right to Require Repurchase............................... 82
SECTION 14.02. Notices; Method of Exercising Repurchase Right, Etc....... 82
SECTION 14.03. Merger, Consolidation, Etc................................ 84
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ARTICLE 15
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 15.01. Company to Furnish Trustee Names and Addresses of
Holders........................................................... 85
SECTION 15.02. Trustee to Furnish Company Names and Addresses of
Holders........................................................... 85
SECTION 15.03. Preservation of Information........................ 85
SECTION 15.04. Reports by Trustee................................. 86
SECTION 15.05. Reports by Company................................. 86
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INDENTURE, dated as of __________, 2000, among Ventro Corporation, a
Delaware corporation (herein called the "Company"), and [State Street Bank and
Trust Company of California, N.A.], as Trustee hereunder (herein called the
"Trustee").
RECITALS
The Company has duly authorized the creation of an issue of its _____%
Convertible Subordinated Notes due 2007 (herein called the "Securities") in an
aggregate principal amount not to exceed $345,000,000 (including any
underwriters' over-allotment option), and to provide therefor the Company has
duly authorized the execution and delivery of this Indenture.
All things necessary to make the Securities, when the Securities are
executed by the Company and authenticated and delivered hereunder, the valid
obligation of the Company, and to make this Indenture a valid agreement of the
Company, in accordance with their and its terms, have been done.
NOW, THEREFORE, THIS INDENTURE
W I T N E S S E T H:
For and in consideration of the premises and the purchase of the Securities
by the Holders thereof, the Company and the Trustee mutually covenant and agree,
for the equal and proportionate benefit of all Holders of the securities as
follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions. For all purposes of this Indenture, except as
otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular;
(b) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles in
the United States, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as are
generally accepted at the date of such computation, other than for the purpose
of the definition of Indebtedness and Senior Indebtedness set forth herein; and
(c) the words "herein", "hereof" and "hereunder" and other words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
"Act", when used with respect to any Holder of a Security, has the meaning
specified in Section 1.04.
"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
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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.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 6.12 to act on behalf of the Trustee to authenticate Securities.
"Board Of Directors" or "Board" means either the board of directors of the
Company or any committee of that board empowered to act for it with respect to
this Indenture.
"Board Resolution" means a resolution duly adopted by the Board, a copy of
which, certified by the Secretary or an Assistant Secretary of the Company to
have been duly adopted by the Board and to be in full force and effect on the
date of such certification, shall have been delivered to the Trustee.
"Business Day", means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in The City of New York or the
city in which the principal Corporate Trust Office is located are authorized or
obligated by law or executive order to close.
"Closing Price" has the meaning specified in Section 12.04(h)(i).
"Code" means the United States Internal Revenue Code of 1986, as amended.
"Commission" means the United States Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or, if at any
time after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Stock" includes any stock or shares of any class of the Company
which has no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which is not subject to redemption by the Company; provided,
however, subject to the provisions of Section 12.11, shares issuable on
conversion of Securities shall include only shares of the class designated as
Common Stock of the Company at the date of this Indenture or shares of any class
or classes resulting from any reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which are not subject to redemption by the Company; provided,
further, however, that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable shall be
substantially in the proportion which the total number of shares of such class
resulting from all such reclassifications bears to the total number of shares of
all such classes resulting from all such reclassifications.
"Company" means the Person named as the "Company" in the first paragraph of
this Indenture until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor Person.
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"Company Notice" has the meaning specified in Section 14.02.
"Conversion Agent" means any Person authorized by the Company to convert
Securities in accordance with Article 12. The Company has initially appointed
the Trustee as its Conversion Agent, which shall maintain an office or agency in
the Borough of Manhattan, The City of New York, New York.
"Conversion Price" has the meaning specified in Section 12.01.
"Corporate Trust Office" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered
(which at the date of this Indenture is located at [633 Xxxx 0xx Xxxxxx, 00xx
Xxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000]), except that with respect to presentation
of Securities for payment or for registration of transfer or exchange, such term
shall mean the office or agency of the Trustee at which at any particular time,
its corporate agency business shall be conducted.
"Corporation" means a corporation, company, including, without limitation,
a limited liability company, association, joint-stock company or business trust.
"Custodian" shall mean [State Street Bank and Trust Company of California,
N.A.], as custodian with respect to a Global Security, or any successor entity
thereto.
"Defaulted Interest" has the meaning specified in Section 3.07.
"Depositary" means, with respect to any Securities issued in whole or in
part in the form of one or more Global Securities, the clearing agency that is
registered under the Exchange Act and designated to act as Depositary for such
Securities, as contemplated by Section 3.04, or any successor clearing agency
registered under the Exchange Act as contemplated by Section 3.04.
"Designated Senior Indebtedness" means any particular Senior Indebtedness
in which the instrument creating or evidencing the same or the assumption or
guarantee thereof (or related agreements or documents to which the Company is a
party, as the case may be) expressly provides that such Senior Indebtedness
shall be "Designated Senior Indebtedness" for purposes of the Indenture
(provided that such instrument, agreement or other document may place
limitations and conditions on the right of such Senior Indebtedness to exercise
the rights of the Designated Senior Indebtedness).
"Dollar" or "U.S.$" means a dollar or other equivalent unit in such coin or
currency of the United States as at the time shall be legal tender for the
payment of public and private debts.
"DTC" means The Depository Trust Company, a New York corporation.
"Event of Default" has the meaning specified in Section 5.01.
"Exchange Act" means the United States Securities Exchange Act of 1934, as
amended from time to time.
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"Fundamental Change" means the occurrence of any transaction or event in
connection with which all or substantially all of the Common Stock shall be
exchanged for, converted into, acquired for or constitute solely the right to
receive, consideration (whether by means of an exchange offer, liquidation,
tender offer, consolidation, merger, combination, reclassification,
recapitalization or otherwise) which is not all or substantially all common
stock or shares which are (or, upon consummation of or immediately following
such transaction or event, will be) listed on a United States national
securities exchange or approved for quotation on the Nasdaq National Market or
any similar United States system of automated dissemination of quotations of
securities prices.
"Fundamental Change Redemption Date" has the meaning specified in Section
14.01.
"Fundamental Change Redemption Price" has the meaning specified in the form
of Security.
"Global Security" means any Security issued in the form set forth in
Section 2.02 and registered in the Note Register in the name of a Depositary or
a nominee thereof.
"Holder", when used with respect to any Security, means the Person in whose
name the Security is registered in the Note Register.
"Indebtedness" means, with respect to any Person, and without duplication,
(a) all indebtedness, obligations and other liabilities (contingent or
otherwise) of the Person for borrowed money (including obligations of the Person
in respect of overdrafts, foreign exchange contracts, currency exchange
agreements, interest rate protection agreements, and any loans or advances from
banks, whether or not evidenced by notes or similar instruments) or evidenced by
bonds, debentures, notes or similar instruments (whether or not the recourse of
the lender is to the whole of the assets of the Person or to only a portion
thereof) or obligations in respect of deferred and unpaid purchase price of
assets or property, (b) all reimbursement obligations and other liabilities
(contingent or otherwise) of the Person with respect to letters of credit, bank
guarantees or bankers' acceptances, (c) all obligations and liabilities
(contingent or otherwise) in respect of leases of the Person required, in
conformity with generally accepted accounting principles, to be accounted for as
capitalized lease obligations on the balance sheet of the Person and all
obligations and other liabilities (contingent or otherwise) under any lease or
related document (including a purchase agreement) in connection with the lease
of real property or improvements thereon which provides that the Person is
contractually obligated to purchase or cause a third party to purchase the
leased property and thereby guarantee a minimum residual value of the leased
property to the lessor and the obligations of the Person under such lease or
related document to purchase or to cause a third party to purchase such leased
property, (d) all obligations of the Person (contingent or otherwise) with
respect to an interest rate or other swap, cap or collar agreement or other
similar instrument or agreement or foreign currency hedge, exchange, purchase or
similar instrument or agreement, (e) all direct or indirect guaranties or
similar agreements by the Person in respect of, and obligations or liabilities
(contingent or otherwise) of the Person to purchase or otherwise acquire or
otherwise assure a creditor against loss in respect of, indebtedness,
obligations or liabilities of another Person of the kind described in clauses
(a) through (d), (f) any indebtedness or other obligations described in clauses
(a) through (d) secured by any mortgage, pledge, lien or other encumbrance
existing on property
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which is owned or held by the Person, regardless of whether the indebtedness
or other obligation secured thereby shall have been assumed by the Person and
(g) any and all deferrals, renewals, extensions, refinancings and refundings
of, or amendments, modifications or supplements to, any indebtedness,
obligation or liability of the kind described in clauses (a) through (f).
Notwithstanding anything to the contrary in the foregoing, Indebtedness shall
not include any indebtedness of or amounts owed by any Person for compensation
to its employees, or for goods, services or materials purchased in the
ordinary course of its business.
"Indenture" means this Indenture as originally executed or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof, including, for
all purposes of this Indenture and any such supplemental indenture, the
provisions of the Trust Indenture Act that are deemed to be a part of and govern
this Indenture and any such supplemental indenture, respectively.
"Interest Payment Date" means the Stated Maturity of an installment of
interest on the Securities.
"Issuer Order" or "Issuer Request" means a written request or order signed
in the name of the Company by its Chairman of the Board, its Vice Chairman of
the Board, its Chief Executive Officer, its President or a Senior Vice President
or a Vice President, and by its principal financial officer, Treasurer, an
Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to
the Trustee.
"Maturity", when used with respect to any Security, means the date on which
the principal of such Security becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration, call
for redemption, exercise of the repurchase right set forth in Article 14 or
otherwise.
"Nasdaq National Market" means the electronic inter-dealer quotation system
operated by Nasdaq, Inc., a subsidiary of the National Association of Securities
Dealers, Inc.
"Non-Electing Share" has the meaning specified in Section 12.11.
"Note Register" has the meaning specified in Section 3.04.
"Note Registrar" has the meaning specified in Section 2.02. The Company has
initially appointed the Trustee as its Note Registrar for the purpose of
registering Securities and transfers and exchange of Securities as provided for
herein. The Trustee shall maintain an office or agency for such purposes in the
City of New York.
"Officer" means, with respect to the Company, the Chairman of the Board, a
Vice Chairman of the Board, the Chief Executive Officer, the President or a
Senior Vice President or a Vice President, the principal financial officer, the
Treasurer, or Assistant Treasurer, the Secretary or an Assistant Secretary.
"Officers' Certificate" means a certificate signed both (a) by the Chairman
of the Board, a Vice Chairman of the Board, the Chief Executive Officer, the
President or a Senior Vice
5
President or a Vice President and (b) by the principal financial officer,
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
the Company and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of independent counsel of
recognized standing who may be counsel for the Company and who shall be
reasonably acceptable to the Trustee.
"Outstanding", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(i) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Securities for the payment or redemption of which money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) or set aside and segregated in trust
by the Company (if the Company shall act as its own Paying Agent) for the
Holders of such Securities, provided 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;
(iii) Securities which have been paid pursuant to Section 3.06 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by a bona fide purchaser
in whose hands such Securities are valid obligations of the Company; and
(iv) Securities converted into Common Stock pursuant to Article 12;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities are present at a meeting of Holders
of Securities for quorum purposes or have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in making such calculation or in relying upon any such determination as to the
presence of a quorum or 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. Securities so
owned which have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Trustee the pledgee's right
so to act with respect to such Securities and that the pledgee is not the
Company or any other obligor upon the Securities or any Affiliate of the Company
or such other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal, Redemption Price, Fundamental Change Redemption Price, or interest,
if any, on any Securities on behalf of the Company and, except as otherwise
specifically set forth herein, such term shall include the Company if it shall
act as its own Paying Agent. The Company has initially appointed the Trustee as
its Paying Agent, which shall maintain an office or agency in The City of New
York, New York.
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"Payment Blockage Notice" has the meaning specified in Section 13.02.
"Person" means any individual, corporation, partnership, joint venture,
association, trust, estate, unincorporated organization or government or any
agency or political subdivision thereof, and includes any successor of such
entity.
"Place of Conversion" has the meaning specified in Section 3.01.
"Place of Payment" has the meaning specified in Section 3.01.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.06 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Purchased Shares" has the meaning specified in Section 12.04(f).
"Record Date" means any Regular Record Date or Special Record Date.
"Redemption Date", when used with respect to any Security to be redeemed in
whole or in part, means the date fixed for such redemption as set forth in the
form of Security.
"Redemption Price", when used with respect to any Security to be redeemed,
means the applicable price referred to therein.
"Regular Record Date" for interest payable in respect of any Security on
any Interest Payment Date means the _________ or _________ (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
"Representative" means the (a) indenture trustee or other trustee, agent or
representative for any Senior Indebtedness or (b) with respect to any Senior
Indebtedness that does not have any such trustee, agent or other representative,
(i) in the case of such Senior Indebtedness issued pursuant to an agreement
providing for voting arrangements as among the holders or owners of such Senior
Indebtedness, any holder or owner of such Senior Indebtedness acting with the
consent of the required persons necessary to bind such holders or owners of such
Senior Indebtedness and (ii) in the case of all other such Senior Indebtedness,
the holder or owner of such Senior Indebtedness.
"Responsible Officer", when used with respect to the Trustee, means any
officer in the Corporate Trust Office of the Trustee and also means, with
respect to a particular corporate trust matter, any other officer of the Trustee
to whom such matter is referred because of his knowledge and familiarity with
the particular subject.
"Securities" has the meaning ascribed to it in the first paragraph under
the caption "Recitals."
7
"Securities Act" means the United States Securities Act of 1933, as amended
from time to time.
"Senior Indebtedness" means the principal of, premium, if any, interest
(including all interest accruing subsequent to the commencement of any
bankruptcy or similar proceeding, whether or not a claim for post-petition
interest is allowable as a claim in such proceeding) and rent payable on or in
connection with, and all fees, costs, expenses and other amounts accrued or due
on or in connection with, Indebtedness of the Company, whether outstanding on
the date of this Indenture or thereafter created, incurred, assumed, guaranteed
or in effect guaranteed by the Company (including all deferrals, renewals,
extensions or refundings of, or amendments, modifications or supplements to, the
foregoing), unless in the case of any particular Indebtedness the instrument
creating or evidencing the same or the assumption or guarantee thereof expressly
provides that such Indebtedness shall not be senior in right of payment to the
Securities or expressly provides that such Indebtedness is "pari passu" or
"junior" to the Securities. Notwithstanding the foregoing, Senior Indebtedness
shall not include any Indebtedness of the Company to any Subsidiary of the
Company or any other entity in which the Company owns voting stock.
"Significant Subsidiary" means, as of any date of determination, a
Subsidiary of the Company, if as of such date of determination either (a) the
assets of such subsidiary equal 10% or more of the Company's total consolidated
assets as of the date of the Company's latest audited balance sheet or (b) the
total revenue of which represented 10% or more of the Company's consolidated
total revenue for the most recently completed fiscal year.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.07.
"Stated Maturity", when used with respect to any Security or any
installment of interest thereon, means the date specified in such Security as
the fixed date on which the principal of such Security or such installment of
interest is due and payable.
"Subsidiary" means, with respect to any Person, a corporation more than 50%
of the outstanding voting stock of which is owned, directly or indirectly, by
such Person or by one or more other Subsidiaries, or by such Person and one or
more other Subsidiaries. For the purposes of this definition, "Voting Stock"
means stock or other similar interests in the corporation which ordinarily has
or have voting power for the election of directors, or persons performing
similar functions, whether at all times or only so long as no senior class of
stock or other interests has or have such voting power by reason of any
contingency.
"Successor Security" of any particular Security means every Security issued
after, and evidencing all or a portion of the same debt as that evidenced by,
such particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.06 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
"Trading Day" has the meaning specified in Section 12.04(h)(v).
8
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this Indenture was executed; provided, however, that in the
event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this Indenture until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean
such successor Trustee.
The definitions of certain other terms are specified in Article 12 and
elsewhere in this Indenture.
SECTION 1.02. Compliance Certificates and Opinions. Upon any application
or request by the Company to the Trustee or any Paying Agent to take any action
under any provision of this Indenture, the Company shall furnish to the Trustee
or the Paying Agent, as the case may be, an Officers' Certificate stating that
all conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with and if required hereunder, an Opinion of
Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with, except that in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture relating to such
particular application or request, no additional certificate or opinion need be
furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (excluding certificates provided for in
Section 10.05) shall include:
(a) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such individual, he or she has
made such examination or investigation as is necessary to enable him or
her, as the case may be, to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered to the Trustee. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
9
Any certificate or opinion of an Officer may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such Officer knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which such certificate or opinion is based are erroneous. Any
such certificate or opinion of counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
Officer or Officers stating that the information with respect to such factual
matters is in the possession of the Company unless such counsel knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.04. Acts of Holders of Securities. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided or
permitted by this Indenture to be given or taken by Holders of Securities may be
embodied in and evidenced by (i) one or more instruments of substantially
similar tenor signed by such Holders in person or by agents or proxies duly
appointed in writing by such Holders, (ii) the record of Holders of Securities
voting in favor thereof, either in person or by proxies duly appointed in
writing, at any meeting of Holders of Securities duly called and held in
accordance with the provisions of Article 9 or (iii) a combination of such
instruments and any such record. Such action shall become effective when such
instrument or instruments or record or both are delivered to the Trustee and,
where it is hereby expressly required, to the Company. The Trustee shall
promptly deliver to the Company copies of all such instruments and records
delivered to the Trustee with a courtesy copy to the Company's counsel at the
address listed in Section 1.05 and if pertaining to any conversion notice, with
a courtesy copy to Company's common stock transfer agent at the address listed
in Section 1.05. Such instrument or instruments and record (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as the
"Act" of the Holders of Securities signing such instrument or instruments and so
voting at such meeting. Proof of execution of any such instrument or of a
writing appointing any such agent or proxy, or of the holding by any Person of a
Security, shall be sufficient for any purpose of this Indenture and (subject to
Section 6.01) conclusive in favor of the Trustee and the Company if made in the
manner provided in this Section. The record of any meeting of Holders of
Securities shall be proved in the manner provided in Section 9.06.
(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 him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority.
(c) The principal amount and serial number of any Security held by any
Person, and the date of his holding the same, shall be proved by the Note
Register.
10
(d) The fact and date of execution of any such instrument or writing and
the authority of the Person executing the same may also be proved in any other
manner which the Trustee or the Paying Agent deems sufficient; and the Trustee
or any Paying Agent may in any instance require further proof with respect to
any of the matters referred to in this Section 1.04.
(e) The Company may set any day as the record date for the purpose of
determining the Holders entitled to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action, or to vote on
any action, authorized or permitted by this Indenture to be given or taken by
Holders. Promptly and in any case not later than ten days after setting a record
date, the Company shall notify the Trustee, each Paying Agent and the Holders of
such record date. If not set by the Company prior to the first solicitation of a
Holder made by any Person in respect of any such action, or, in the case of any
such vote, prior to such vote, the record date for any such action or vote shall
be the 30th day (or, if later, the date of the most recent list of Holders
required to be provided pursuant to Section 15.01) prior to such first
solicitation or vote, as the case may be. With regard to any record date, the
Holders on such date (or their duly appointed agents or proxies), and only such
Persons, shall be entitled to give or take, or vote on, the relevant action,
whether or not such Holders remain Holders after such record date.
Notwithstanding the foregoing, the Company shall not set a record date for, and
the provisions of this paragraph shall not apply with respect to, any notice,
declaration or direction referred to in the next paragraph.
Upon receipt by the Trustee from any Holder of (i) any notice of default or
breach referred to in Section 5.01(c), if such default or breach has occurred
and is continuing and the Trustee shall not have given such a notice to the
Company, (ii) any declaration of acceleration referred to in Section 5.02, if an
Event of Default has occurred and is continuing and the Trustee shall not have
given such a declaration to the Company, or (iii) any direction referred to in
Section 5.12, if the Trustee shall not have taken the action specified in such
direction, then a record date shall automatically and without any action by the
Company or the Trustee be set for determining the Holders entitled to join in
such notice, declaration or direction, which record date shall be the close of
business on the tenth day (or, if such day is not a Business Day, the first
Business Day thereafter) following the day on which the Trustee receives such
notice, declaration or direction. Promptly after such receipt by the Trustee,
and as soon as practicable thereafter, the Trustee shall notify the Company and
the Holders of any such record date so fixed. The Holders on such record date
(or their duly appointed agents or proxies), and only such Persons, shall be
entitled to join in such notice, declaration or direction, whether or not such
Holders remain Holders after such record date; provided that, unless such
notice, declaration or direction shall have become effective by virtue of
Holders of the requisite principal amount of Securities on such record date (or
their duly appointed agents or proxies) having joined therein on or prior to the
90th day after such record date, such notice, declaration or direction shall
automatically and without any action by any Person be canceled and of no further
effect. Nothing in this paragraph shall be construed to prevent a Holder (or a
duly appointed agent or proxy thereof) from giving, before or after the
expiration of such 90-day period, a notice, declaration or direction contrary to
or different from, or, after the expiration of such period, identical to, the
notice, declaration or direction to which such record date relates, in which
event a new record date in respect thereof shall be set pursuant to this
paragraph. In addition, nothing in this paragraph shall be construed to render
ineffective any notice, declaration or direction of the type referred to in this
paragraph given at any time to the Trustee and the Company by
11
Holders (or their duly appointed agents or proxies) of the requisite principal
amount of Securities on the date such notice, declaration or direction is so
given.
(f) Any request, demand, authorization, direction, notice, consent,
election, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Successor 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 or the Company in reliance thereon, whether or not notation of such
action is made upon such Security.
(g) The provisions of this Section 1.04 are subject to the provisions of
Section 9.05.
SECTION 1.05. Notices, Etc., to Trustee and the Company. Any request,
demand, authorization, direction, notice, consent, election, waiver or Act of
Holders of Securities or other document provided or permitted by this Indenture
to be made upon, given or furnished to, or filed with,
(a) the Trustee in [Los Angeles, California] or the office or agency
of the Trustee in New York, New York by any Holder of Securities or by the
Company shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee and received at its
Corporate Trust Office, [633 Xxxx 0xx Xxxxxx, 00xx Xxxxx, Xxx Xxxxxxx,
Xxxxxxxxxx 00000], Attention: Corporate Trust Department - Ventro
Corporation ___% Convertible Subordinated Notes due 2007 (facsimile number
____________), or to or with the office or agency of the Trustee at [State
Street Bank and Trust Company, N.A., 00 Xxxxxxxx, Xxxxxxxxx Xxxxx,
Xxxxxxxxx Trust Window, New York, New York 10006], Attention: Ventro
Corporation ___% Convertible Subordinated Notes due 2007. In addition, a
courtesy copy shall be sent to Trustee's counsel (which shall not
constitute notice to the Trustee): ____________________,
______________________________, Attention: _______________, Esq.
(facsimile number ____________) or
(b) the Company by the Trustee or any Paying Agent or by any Holder of
Securities shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if in writing, mailed, first-class
postage prepaid, or telecopied and confirmed by mail, first-class postage
prepaid, or delivered by hand or overnight courier, addressed to the
Company at Ventro Corporation, 0000 Xxxxxxxx Xxxxxx, Xxxxxxxx Xxxx,
Xxxxxxxxxx 00000 (facsimile number: (650) __________), Attention: Chief
Financial Officer, or at any other address previously furnished in writing
to the Trustee by the Company. In addition, a courtesy copy shall be sent
to the Company's counsel (which shall not constitute notice to the
Company): ______________________________ (facsimile number (650)
__________), Attention: _______________, Esq. and if relating to a
conversion notice as described in Section 2.02, with a copy to Company's
common stock transfer agent, _______________________,
______________________________ (telephone number _______________).
12
Any request, demand, authorization, direction, notice, consent, election or
waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication.
SECTION 1.06. Notice to Holders of Securities; Waiver. Except as
otherwise expressly provided herein, where this Indenture provides for notice to
Holders of Securities of any event, such notice shall be sufficiently given to
Holders of Securities if in writing and mailed, first-class postage prepaid, to
each Holder of a Security affected by such event, at the address of such Holder
as it appears in the Note Register, not earlier than the earliest date and not
later than the latest date prescribed for the giving of such notice. Such notice
shall be conclusively deemed to have been given and received by Holders when
such notice is mailed, whether or not such Holder receives such notice.
In any case where notice to Holders of Securities is given by mail, neither
the failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder of a Security shall affect the sufficiency of such notice with
respect to other Holders of Securities given as provided above. In case by
reason of the suspension of or irregularities in regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification to Holders of Securities as shall be made with the
approval of the Trustee, which approval shall not be unreasonably withheld,
shall constitute a sufficient notification to such Holders for every purpose
hereunder.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders of Securities shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
SECTION 1.07. Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 1.08. Successors and Assigns. All covenants, stipulations,
promises and agreements in this Indenture by the Company shall bind its
successors and assigns, whether so expressed or not.
SECTION 1.09. Separability Clause. In case any provision in this
Indenture or the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 1.10. Benefits of Indenture. Except as provided in the next
sentence, nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors and
assigns hereunder and the Holders of Securities, any benefit or legal or
equitable right, remedy or claim under this Indenture. The provisions of Article
13 are intended to be for the benefit of, and shall be enforceable directly by,
the holders of Senior Indebtedness.
13
SECTION 1.11. Governing Law. THIS INDENTURE AND EACH SECURITY SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
THE UNITED STATES OF AMERICA, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF
LAWS.
SECTION 1.12. Legal Holidays. In any case where any due date for the
payment of interest or principal, Redemption Date, Fundamental Change Redemption
Date or Stated Maturity of any Security or the last day on which a Holder of a
Security has a right to convert his Security shall not be a Business Day at any
Place of Payment or Place of Conversion, as the case may be, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of interest or principal, Redemption Price, Fundamental Change
Redemption Price, or delivery for conversion of such Security need not be made
at such Place of Payment or Place of Conversion, as the case may be, on or by
such day, but may be made on or by the next succeeding Business Day at such
Place of Payment or Place of Conversion, as the case may be, with the same force
and effect as if made on the Interest Payment Date, Redemption Date, Fundamental
Change Redemption Date, or at the Stated Maturity or by such last day for
conversion; provided, however, that in the case that payment is made on such
succeeding Business Day, no interest shall accrue on the amount so payable for
the period from and after such Interest Payment Date, Redemption Date,
Fundamental Change Redemption Date, Stated Maturity or last day for conversion,
as the case may be.
SECTION 1.13. Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with a provision of the Trust Indenture Act that
is required under the Trust Indenture Act to be a part of and to govern this
Indenture, the latter provision shall control. If any provision of this
Indenture modifies or excludes any provision of the Trust Indenture Act that may
be so modified or excluded, the latter provision shall be deemed to apply to
this Indenture as so modified or to be excluded, as the case may be. Until such
time as this Indenture shall be qualified under the Trust Indenture Act, this
Indenture, the Company and the Trustee shall be deemed for all purposes hereof
to be subject to and governed by the Trust Indenture Act to the same extent as
would be the case if this Indenture were so qualified on the date hereof.
SECTION 1.14. Indenture and Securities Solely Corporate Obligations. No
recourse for the payment of the principal, Redemption Price, Fundamental Change
Redemption Price, or interest in respect of, any Security and no recourse under
or upon any obligation, covenant or agreement of the Company in this Indenture
or in any supplemental indenture or in any Security, or because of the creation
of any indebtedness represented thereby, shall be had against any incorporator,
stockholder, employee, agent, officer, or director or subsidiary, as such, past,
present or future, of the Company or of any successor corporations, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise; it being expressly understood that all such
liability is hereby waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issue of the
Securities.
14
ARTICLE 2
SECURITY FORMS
SECTION 2.01. Forms Generally. The Securities shall be in substantially
the forms set forth in this Article, with such appropriate insertions,
omissions, substitutions and other variations as are required or permitted by
this Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with the Securities Act and the Exchange Act, applicable
state securities law or the rules of any securities exchange, the Code, and the
treasury regulations under the Code, or as may, consistently herewith, be
determined by the Officers executing such Securities, as evidenced by their
execution thereof.
The Election of Holder to Require Repurchase shall be substantially in the
form set forth in Section 2.03. The Conversion Notice shall be in substantially
the form set forth in Section 2.04. The Trustee's certificate of authentication
shall be in substantially the form set forth in Section 2.05.
The Securities may be printed, lithographed, typewritten, mimeographed or
otherwise produced, as determined by the Officers executing such Security, as
evidenced by their execution thereof.
SECTION 2.02. Form of Security. [FORM OF LEGEND FOR GLOBAL SECURITY:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY (55 XXXXX XXXXXX, XXX XXXX, XXX XXXX) (THE
"DEPOSITARY," WHICH TERM INCLUDES ANY SUCCESSOR DEPOSITARY FOR THE CERTIFICATES)
TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DEPOSITARY AND ANY
PAYMENT HEREON IS MADE TO CEDE & CO. (OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), 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 XXXXXX.]
00
XXXXXX XXXXXXXXXXX
____% CONVERTIBLE SUBORDINATED NOTE DUE 2007
No. __________ U.S.$__________ principal amount
CUSIP NO. __________
Ventro Corporation, a Delaware corporation (herein called the "Company,"
which term includes any successor Person under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to_______________,
or registered assigns (the "Holder"), the principal sum of_____________ Dollars
($__________) on _____________, 2007 at the office or agency of the Company
maintained for that purpose in New York, New York, in such coin or currency of
the United States of America as at the time of payment shall be legal tender for
the payment of public and private debts, and to pay interest, semi-annually in
arrears on _________ and _________ in each year (each, an "Interest Payment
Date"), commencing _________, 2000 on said principal amount at maturity at the
rate of ____% per annum.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the _________ or _________ (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date. Except as
otherwise provided in the Indenture, any such interest not so punctually paid or
duly provided for ("Defaulted Interest") on an Interest Payment Date will
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Company, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in the Indenture. Payment of
interest on this Security may be made, at the option of the Company, by United
States Dollar check mailed to the address of the Person entitled thereto as such
address shall appear in the Note Register, or, upon written application by the
Holder to the Note Registrar setting forth wire instructions not later than the
relevant Record Date, by transfer to a United States Dollar account (such a
transfer to be made only to a Holder of an aggregate principal amount of
Securities in excess of U.S.$2,000,000 and only if such Holder shall have
furnished wire instructions in writing to the Trustee no later than 15 days
prior to the relevant payment date) maintained by the Holder with a bank in the
United States.
Reference is made to the further provisions of this Security set forth on
the reverse hereof, including, without limitation, provisions subordinating the
payment of principal, Redemption Price, Fundamental Change Redemption Price and
interest, if any, in respect of the Securities to the prior payment in full of
all Senior Indebtedness as defined in the Indenture and provisions giving the
holder of this Security the right to convert this Security into Common Stock on
the terms and subject to the limitations referred to on the reverse hereof and
as more
16
fully specified in the Indenture. Such further provisions shall for all
purposes have the same effect as though fully set forth at this place.
Capitalized terms used herein, including on the reverse hereof, and not
defined herein or on the reverse hereof shall have the respective meanings
given to such terms in the Indenture.
This Security shall be deemed to be a contract made under the laws of the
State of New York, and for all purposes shall be construed in accordance with
and governed by the laws of said State.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof or an Authenticating Agent by the
manual signature of one of their respective authorized signatories, this
Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
17
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers under its corporate
seal.
Dated:
VENTRO CORPORATION
By: ____________________________________
Name:
Title:
Attest
18
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of securities of the
Company designated as its "___% Convertible Subordinated Notes due 2007" (herein
called the "Securities"), limited in aggregate principal amount to U.S.
$345,000,000, including $45 million aggregate principal amount of Securities
that may be sold by the Company pursuant to the over-allotment option granted
under the Underwriting Agreement dated ____, 2000 among the Company, Xxxxxx
Xxxxxxx & Co. Incorporated, FleeetBoston Xxxxxxxxx Xxxxxxxx Inc., Xxxxx
Securities Inc and Duetche Bank Securities, Inc., as representatives of the
several underwriters, issued and to be issued under and pursuant to an
Indenture, dated as of _________, 2000 (herein called the "Indenture"), among
the Company and ________________________, as Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby made
for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee, the holders of Senior
Indebtedness and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered. The Securities are
issuable in the denomination of U.S.$1,000 and integral multiples thereof. As
provided in the Indenture and subject to the limitations therein set forth, the
Securities are exchangeable at the Corporate Trust Office of the Trustee, or the
office or agency of the Trustee, or at such other office or agency of the
Company as may be designated by it for such purpose, in The City of New York
(each a "Note Registrar").
No sinking fund is provided for the Securities. The Securities will not be
redeemable at the option of the Company prior to _________, 2003. At any time
on or after _________, 2003, and prior to maturity, the Securities are subject
to redemption at the option of the Company at any time, upon not less than 30
nor more than 60 days' notice to the Holders prior to the Redemption Date, in
whole or in part, at the following optional Redemption Prices (expressed as
percentages of the principal amount), together in each case with accrued
interest, to but excluding, the Redemption Date.
Redemption Date Redemption
Price
------------------------------------------------------------------ ------------------
Beginning on __________, 2003 and ending on __________, 2004 %
Beginning on __________, 2004 and ending on __________, 2005
Beginning on __________, 2005 and ending on __________, 2006
Beginning on __________, 2006 and ending on __________, 2007
and 100% on __________, 2007; provided however, that if the date fixed for
redemption is on an Interest Payment Date, then the interest payable on such
date shall be paid to the Holder of record of the Security on the Regular Record
Date next preceding such Redemption Date. In the event of a redemption of less
than all of the Securities, the Company will not be required (a) to register the
transfer or exchange of Securities for a period of 15 days immediately preceding
the date notice is given identifying the serial numbers of the Securities called
for such redemption or (b) to register the transfer or exchange of any Security,
or portion thereof, called for redemption.
19
In any case where the due date for the payment of the principal, Redemption
Price, Fundamental Change Redemption Price, or interest, if any, in respect of,
any Security or the last day on which a Holder of a Security has a right to
convert his Security shall not be a Business Day, at any Place of Payment or
Place of Conversion, as the case may be, then payment of principal, Redemption
Price, Fundamental Change Redemption Price, or interest, if any, in respect of
such Security or delivery for conversion of such Security need not be made on or
by such date at such place but may be made on or by the next succeeding Business
Day at such Place of Payment or Place of Conversion, as the case may be, with
the same force and effect as if made on the date for such payment or the date
fixed for redemption or repurchase, or by such last day for conversion, and no
interest shall accrue on the amount so payable for the period after such date.
Subject to the provisions of the Indenture, the Holder hereof has the
right, at his option, at any time through the close of business on ____________,
2007, or, as to all or any portion hereof called for redemption, prior to the
close of business on the Business Day immediately preceding the date fixed for
redemption (unless the Company shall default in payment due upon redemption
thereof), to convert the principal hereof or any portion of such principal which
is $1,000 principal amount at maturity or a multiple thereof, into that number
of fully paid and nonassessable shares of Common Stock, as said shares shall be
constituted at the date of conversion, obtained by dividing the principal amount
of this Note or portion thereof to be converted by $______ (the "Conversion
Price") or such Conversion Price as adjusted from time to time as provided in
the Indenture, upon surrender of this Security, together with a conversion
notice as provided in the Indenture, to the Company at the office or agency of
the Company maintained for that purpose in New York, New York or ______________,
and, unless the shares issuable on conversion are to be issued in the same name
as this Security, duly endorsed by, or accompanied by instruments of transfer in
form satisfactory to the Company duly executed by the holder or by his duly
authorized attorney. No adjustments in respect of accrued interest or dividends
will be made upon any conversion; provided, however, that if this Security shall
be surrendered for conversion during the period from, but excluding, a record
date for any interest payment date to, but excluding such Interest Payment Date,
this Security (unless it or the portion being converted shall have been called
for redemption on a Redemption Date which occurs during such period, or is to be
redeemed in connection with a Fundamental Change on a Fundamental Change
Redemption Date which occurs during such period) must be accompanied by an
amount, in New York Clearing House funds, equal to the interest payable on such
interest payment date on the principal amount at maturity being converted;
provided further, however that no such payment need be made if there shall exist
at the time of conversion a default in the payment of interest on the
Securities. No fractional shares will be issued upon any conversion, but an
adjustment in cash will be made, as provided in the Indenture, in respect of any
fraction of a share which would otherwise be issuable upon the surrender of any
Security or Securities for conversion.
If a Fundamental Change (as defined in the Indenture) occurs at any time on
or prior to ___________, 2007, each Holder shall have the right, at such
Holder's option, to require the Company to repurchase all of such Holder's
Securities at a price (the "Fundamental Change Redemption Price") equal to 100%
of the principal amount thereof, on the date (the "Fundamental Change Redemption
Date") (or if such date is not a Business Day, the next succeeding Business Day)
that is 45 days after notice thereof. In each case, the Company shall
20
also pay accrued interest, if any, on such Securities to, but excluding, the
Fundamental Change Redemption Date; provided that if such Fundamental Change
Redemption Date is on an Interest Payment Date, then the interest payable on
such date shall be paid to the Holder of record of the Securities on the Regular
Record Date next preceding such Fundamental Change Redemption Date. The Company
shall mail to all holders of record of the Securities a notice of the occurrence
of a Fundamental Change and of the redemption right arising as a result thereof
on or before the 30th day after the occurrence of such Fundamental Change. For a
Security to be so repaid at the option of the Holder, the Trustee or any Paying
Agent must receive such Security with the form entitled "Option to Elect
Redemption Upon a Fundamental Change" on the reverse thereof duly completed,
together with such Securities duly endorsed for transfer, on or before the 30th
day after the date of such notice (or if such 30th day is not a Business Day,
the immediately preceding Business Day). All questions as to the validity,
eligibility (including time of receipt) and acceptance of any Security for
redemption shall be determined by the Company, whose determination shall be
final and binding.
[The following paragraph shall appear in each Security that is not a Global
Security:
In the event of redemption, repurchase or conversion of this Security in
part only, a new Security or Securities for the unredeemed, unrepurchased or
unconverted portion hereof will be issued in the name of the Holder hereof.]
In the event of a deposit or withdrawal of an interest in this Security,
including an exchange, transfer, redemption, repurchase or conversion of this
Security in part only, the Trustee, as Custodian of the Depositary, shall make
an adjustment on its records to reflect such deposit or withdrawal in accordance
with the rules and procedures of the Depositary.
The indebtedness evidenced by this Security and the obligations of the
Company under the Indenture are to the extent and in the manner provided in the
Indenture, expressly subordinate and subject in right of payment to the prior
payment in full of all Senior Indebtedness (as defined in the Indenture),
whether outstanding on the date of the Indenture or thereafter incurred, and
this Security is issued subject to such provisions of the Indenture with respect
thereto. Each Holder of this Security, by accepting the same, (a) agrees to and
shall be bound by such provisions, (b) authorizes and directs the Trustee on his
behalf to take such action as may be necessary or appropriate to effectuate the
subordination so provided and (c) appoints the Trustee his attorney-in-fact for
any and all such purposes.
If an Event of Default (as defined in the Indenture) shall occur and be
continuing, the principal of and accrued interest to the date of declaration,
may be declared due and payable, with the effect and subject to the conditions
provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time (a) by the Company and the Trustee with the written consent of the
Holders of not less than a majority in aggregate principal amount of the
Securities at the time Outstanding (as defined in the Indenture), or (b) by the
adoption of a resolution, at a meeting of Holders of the Outstanding Securities
at which a quorum is present, by the Holders of at least a majority in aggregate
principal amount of the Securities at the time
21
Outstanding. The Indenture also contains provisions permitting the Holders of
specified percentages in aggregate principal amount of the Securities at the
time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Successor
Security to this Security, whether or not notation of such consent or waiver is
made upon this Security or such other Security.
As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless (a) such Holder shall have previously given
the Trustee written notice of a continuing Event of Default, (b) the Holders of
not less than 25% in aggregate principal amount of the Securities Outstanding
shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee and offered the Trustee reasonable
indemnity and the Trustee shall not have received from the Holders of a majority
in aggregate principal amount of the Securities Outstanding a direction
inconsistent with such request, and (c) shall have failed to institute any such
proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder of
this Security for the enforcement of any payment of principal, Redemption Price,
Fundamental Change Redemption Price, or interest in respect hereof on or after
the respective due dates expressed herein or for the enforcement of the right to
convert this Security as provided in the Indenture.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligations of the Company, which are
absolute and unconditional, to pay the principal, Redemption Price, Fundamental
Change Redemption Price and interest, if any, in respect of this Security at the
times, places and rate, and in the coin or currency, herein prescribed or to
convert this Security as provided in the Indenture.
Interest on the Securities shall be computed on the basis of a 360-day year
of twelve 30-day months.
The Securities are issuable in registered form without coupons in
denominations of $1,000 principal amount and any multiple thereof. As provided
in the Indenture and subject to certain limitations therein set forth, the
transfer of Securities is registrable on the Note Register (as defined in the
Indenture) upon surrender of a Security for registration of transfer (a) at the
Corporate Trust Office of the Trustee or at the office or agency of the Trustee
in the Borough of Manhattan or at such other office or agency of the Company as
may be designated by it for such purpose in the Borough of Manhattan, The City
of New York, or (b) subject to any laws or regulations applicable thereto and to
the right of the Company to terminate the appointment of any Note Registrar, at
the offices of the Note Registrars described herein or at such other offices or
agencies as the Company may designate, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the Note
Registrar duly executed by, the Holder thereof or his attorney duly authorized
in writing, and thereupon one or more new Securities, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees by the Note Registrar. No service charge
shall
22
be made for any such registration of transfer or exchange, but the Company may
require payment of a sum sufficient to recover any tax or other governmental
charge payable in connection therewith.
No recourse for the payment of the principal, Redemption Price, Fundamental
Change Redemption Price, or interest, if any, in respect of this Security, or
for any claim based hereon or otherwise in respect hereof, and no recourse under
or upon any obligation, covenant or agreement of the Company in the Indenture or
any indenture supplemental thereto or in any Security, or because of the
creation of any indebtedness represented thereby, shall be had against any
incorporator, stockholder, employee, agent, officer or director or subsidiary,
as such, past, present or future, of the Company or of any successor
corporations, either directly or through the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of consideration for the issue
hereof, expressly waived and released.
Prior to due presentation of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered, as the owner thereof for all
purposes, whether or not such Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
SECTION 2.03. Form of Election of Holder to Require Repurchase.
ELECTION OF HOLDER TO REQUIRE REPURCHASE
(a) Pursuant to Section 14.01 of the Indenture, the undersigned hereby
elects to have this Security repurchased by the Company.
(b) The undersigned hereby directs the Company to pay it or _______________
the Fundamental Change Redemption Price plus interest accrued to, but excluding,
the Fundamental Change Redemption Date, as provided in the Indenture.
Dated:____________________
________________________________________
________________________________________
Signature(s)
Principal amount to be repurchased: ____________________
Remaining principal amount following such repurchase: ______________
23
Signature(s) must be guaranteed by a commercial bank or trust company or a
member firm of a major stock exchange with membership in an approved signature
guarantee medallion program pursuant to the Securities and Exchange Commission
Rule 17Ad-15 if shares of Common Stock are to be issued, or Securities to be
delivered, other than to or in the name of the registered
Holder._______________________. Signature Guaranteed
NOTICE: The signature to the foregoing Election must correspond to the name as
written upon the face of this Security in every particular, without alteration
or any change whatsoever.
SECTION 2.04. Form of Conversion Notice.
CONVERSION NOTICE
The undersigned Holder of this Security hereby irrevocably exercises the
option to convert this Security, or any portion of the principal amount hereof
(which is an integral multiple of U.S.$1,000) below designated, into shares of
Common Stock of the Company in accordance with the terms of the Indenture
referred to in this Security, and directs that such shares, together with a
check in payment for any fractional shares and any Securities representing any
unconverted principal amount hereof, be delivered to and be registered in the
name of the undersigned unless a different name has been indicated below. If
shares of Common Stock or Securities are to be registered in the name of a
Person other than the undersigned, the undersigned will pay all transfer taxes
payable with respect thereto. Any amount required to be paid by the undersigned
on account of interest accompanies this Security.
Dated: ___________________
_________________________________________
_________________________________________
Signature(s)
If shares or Securities are to be registered If only a portion of the Security is to be
in the name of a Person other than the converted, please indicate:
Holder, please print such Person's name and
address: Principal amount to be converted:
------------------------------------------- U.S.$____________________
Name
___________________________________________
Address
___________________________________________
Social Security or other Taxpayer
Identification Number, if any
24
Signature(s) must be guaranteed by a commercial bank or trust company or a
member firm of a major stock exchange with membership in an approved signature
guarantee medallion program pursuant to the Securities and Exchange Commission
Rule 17Ad-15 if shares of Common Stock are to be issued, or Securities to be
delivered, other than to or in the name of the registered
Holder._______________________. Signature Guaranteed
SECTION 2.05. Form of Certificate of Authentication. The Trustee's
certificate of authentication shall be in substantially the following form:
This is one of the Securities referred to in the within-mentioned
Indenture.
Dated: _______________
[_________________________________], as
Trustee
By: ---------------------------------------
Authorized Signatory
ARTICLE 3
THE SECURITIES
SECTION 3.01. Title and Terms. The aggregate principal amount of
Securities which may be authenticated and delivered under this Indenture is
limited to U.S. $345,000,000, except for Securities authenticated and delivered
in exchange for, or in lieu of, other Securities pursuant to Section 3.04, 3.05,
3.06, 8.05, 11.08, 12.02 or 14.02(e).
The Securities shall be known and designated as the "____% Convertible
Subordinated Notes due 2007" of the Company. Their Stated Maturity shall be
__________, 2007 and they shall bear interest on their principal amount from
__________, 2000, payable semi-annually in arrears on __________ and __________
in each year, commencing __________, 2000, at the rate of _____% until the
principal, Redemption Price or Fundamental Change Redemption Price in respect
thereof is due; provided, however, that payments shall only be made on Business
Days as provided in Section 1.12.
The principal, Redemption Price, Fundamental Change Redemption Price, and
interest in respect of the Securities shall be payable as provided in the form
of Security set forth in Section 2.02 and the Fundamental Change Redemption
Price shall be payable at such places as are identified in the Company Notice
given pursuant to Section 14.02 (any city in which any Paying Agent is located
being herein called a "Place of Payment").
The Securities shall be redeemable at the option of the Company, in whole
or in part, and at the option of the Company as provided in Article 11 and in
the form of Security set forth in Section 2.02.
25
The Securities shall be convertible as provided in Article 12 (any city in
which any Conversion Agent is located being herein called a "Place of
Conversion").
The Securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article 13.
The Securities shall be subject to repurchase by the Company at the option
of the Holder as provided in Article 14.
SECTION 3.02. Denominations. The Securities shall be issuable in
registered form without coupons in denominations of $1,000 principal amount and
any multiple thereof. Every Security shall be dated the date of its
authentication, shall bear interest from the applicable date and shall be
payable on the dates specified on the face of the form of Security recited
above.
SECTION 3.03. Execution, Authentication, Delivery and Dating. The
Securities shall be executed on behalf of the Company, in each case by its
Chairman of the Board, its Vice Chairman of the Board, its Chief Executive
Officer, its President or one of its Senior Vice Presidents or one of its Vice
Presidents, under an impression of its corporate seal or a facsimile of its
corporate seal reproduced thereon attested by its Treasurer or one of its
Assistant Treasurers or Secretary or one of its Assistant Secretaries. Any such
signature may be manual or facsimile.
Securities bearing the manual or facsimile signature of an individual or
individuals who were at any time the proper officer or 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 such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities executed by the Company to the
Trustee or to its order for authentication (or to the Paying Agent), together
with an Issuer Order for the authentication and delivery of such Securities, and
the Trustee or an Authenticating Agent in accordance with such Issuer Order
shall authenticate and make available for delivery such Securities as in this
Indenture provided and not otherwise. In connection with any Issuer Order for
authentication, an Officers' Certificate and Opinion of Counsel pursuant to
Section 1.02 shall be required.
Each Security shall be dated the date of its authentication.
In authenticating the Securities and in accepting the additional
responsibilities under the Indenture in relation to such Securities, the Trustee
shall be entitled to receive and shall be fully protected in relying upon:
(a) A copy of the Board Resolution or Resolutions in or pursuant to
which the terms and form of the Securities were established, and if the
terms and form of such Securities are established by an Officers'
Certificate pursuant to general authorization of the Board of Directors,
such Officers' Certificate;
(b) an executed supplemental indenture, if any; and
26
(c) an Opinion of Counsel stating that:
(i) the form or forms of such Securities have been established in
conformity with the provisions of this Indenture;
(ii) the terms of such Securities have been established in conformity
with the provisions of this Indenture;
(iii) such Securities, when completed by appropriate insertions and
executed and delivered by the Company to the Trustee for authentication in
accordance with this Indenture, authenticated and delivered by the Trustee
in accordance with this Indenture and issued by the Company in the manner
and subject to any conditions specified in such Opinion of Counsel, will
constitute the legal, valid and binding obligations of the Company,
enforceable in accordance with their terms, subject to applicable
bankruptcy, insolvency, reorganization and other similar laws of general
applicability relating to or affecting the enforcement of creditors' rights
and to general equitable principles and to such other qualifications as
such counsel shall conclude do not materially affect the rights of Holders
of such Securities;
(iv) all laws and requirements in respect of the execution and
delivery by the Company of such Securities and of the supplemental
indenture, if any, have been complied with and that authentication and
delivery of such Securities and the execution and delivery of the
supplemental indenture, if any, by the Trustee will not violate the terms
of the Indenture;
(v) the Company has the corporate power to issue such Securities, and
have duly taken all necessary corporate action with respect to such
issuance; and
(vi) the issuance of such Securities will not contravene the articles
of incorporation or by-laws of the Company or result in any violation of
any of the terms or provisions of any law or regulation or of any
indenture, mortgage or other agreement by which the Company are bound known
to such Counsel, which violation would have a material adverse effect on
the Company.
The Trustee shall not be required to authenticate and deliver any such
Securities if the issue of such Securities pursuant to this Indenture will
affect the Trustee's own rights, duties or immunities under the Securities and
this Indenture or otherwise in a manner which is not reasonably acceptable to
the Trustee.
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
executed by the Trustee or an Authenticating Agent by manual signature of an
authorized signatory, and such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been duly authenticated
and delivered hereunder is entitled to the benefits of this Indenture.
Any Global Security shall represent such of the outstanding Securities as
shall be specified therein and shall provide that it shall represent the
aggregate amount of outstanding
27
Securities from time to time endorsed thereon and that the aggregate amount of
outstanding Securities represented thereby may from time to time be increased or
reduced to reflect transfers or exchanges permitted hereby. Any endorsement of a
Global Security to reflect the amount of any increase or decrease in the amount
of outstanding Securities represented thereby shall be made by the Trustee or
the Custodian, at the direction of the Trustee, in such manner and upon
instructions given by the holder of such Securities in accordance with this
Indenture. Payment of principal, Redemption Price, Fundamental Change Redemption
Price and interest, if any, in respect of any Global Security shall be made to
the Holder of such Global Security.
SECTION 3.04. Registration of Transfer and Exchange; Restrictions on
Transfer. (a) The Company shall cause to be kept at the Corporate Trust Office
of the Trustee a register (the register maintained in such office and in any
other office or agency of the Company designated pursuant to Section 10.02
(including the office or agency of State Street Bank and Trust Company of
California, N.A., in the Borough of Manhattan, The City of New York) being
herein sometimes collectively referred to as the "Note Register") in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of Securities and of transfers of Securities.
Upon surrender for registration of transfer of any Security at an office or
agency of the Company designated pursuant to Section 10.02 for such purpose, the
Company shall execute, and the Trustee shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Securities of
any authorized denominations and of a like aggregate principal amount and tenor
and bearing such restrictive legends as may be required by this Indenture.
At the option of the Holder, and subject to the further provisions of this
Section 3.04, Securities may be exchanged for other Securities of any authorized
denomination and of a like aggregate principal amount, upon surrender of the
Securities to be exchanged at any such office or agency maintained by the
Company pursuant to Section 10.02. Whenever any Securities are so surrendered
for exchange, and subject to the further provisions of this Section 3.04, the
Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive. Every
Security presented or surrendered for registration of transfer or for exchange
shall (if so required by the Company or the Note Registrar) be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to the
Company and the Note Registrar duly executed, by the Holder thereof or his
attorney duly authorized in writing.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and, subject to the other provisions of this Section 3.04, entitled to the
same benefits, under and subject to the same restrictions imposed by this
Indenture, as the Securities surrendered upon such registration of transfer or
exchange.
Except as provided in Section 3.06, no service charge shall be made to a
Holder for any registration of transfer or exchange of Securities, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Securities, other than exchanges pursuant to
28
Section 8.05, 11.08, 12.02 or 14.02(e) (other than, in the case of Securities,
where the Common Stock is to be issued or delivered in a name other than that of
the Holder of the Security) not involving any transfer and other than any stamp
and other duties, if any, which may be imposed in connection with any such
transfer or exchange by the United States or any political subdivision thereof
or therein, which shall be paid by the Company.
In the event of a redemption of the Securities in part, neither the Company
nor the Note Registrar will be required (a) to register the transfer of or
exchange of Securities for a period of 15 days immediately preceding the date
notice is given identifying the serial numbers of the Securities called for such
redemption or (b) to register the transfer of or exchange any Security, or
portion thereof, called for redemption.
(b) So long as the Securities are eligible for book-entry settlement with
the Depositary, or unless otherwise required by law, all Securities that are so
eligible may be represented by one or more Global Securities registered in the
name of the Depositary or the nominee of the Depositary, except as otherwise
specified below. The transfer and exchange of beneficial interests in any such
Global Security shall be effected through the Depositary in accordance with this
Indenture and the procedures of the Depositary therefor.
Except as provided below, beneficial owners of a Global Security shall not
be entitled to have certificates registered in their names, will not receive or
be entitled to receive physical delivery of certificates in definitive form and
will not be considered Holders of such Global Securities.
(c) Notwithstanding any other provisions of this Indenture (other than the
provisions set forth in the second paragraph of Section 3.04(b) and in this
Section 3.04(c)), a Global Security may not be transferred as a whole or in part
except by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of such
successor Depositary.
The Depositary shall be a clearing agency registered under the Exchange
Act. The Company initially appoints DTC to act as Depositary with respect to the
Global Securities. Initially, each Global Security shall be issued to the
Depositary, registered in the name of Cede & Co., as the nominee of the
Depositary, and deposited with the Custodian for Cede & Co.
If at any time the Depositary for a Global Security notifies the Company
that it is unwilling or unable to continue as Depositary for such Global
Security, the Company may appoint a successor Depositary with respect to such
Global Security. If a successor Depositary is not appointed by the Company
within ninety (90) days after the Company receives such notice, the Company will
execute, and the Trustee, upon receipt of an Officers' Certificate for the
authentication and delivery of Securities, will authenticate and deliver,
definitive Securities, in aggregate principal amount equal to the Principal
Amount of such Global Security, in exchange for such Global Security.
If a definitive Security is issued in exchange for any portion of a Global
Security after the close of business at the office or agency where such exchange
occurs on any Record Date and
29
before the opening of business at such office or agency on the next succeeding
Interest Payment Date, interest will not be payable on such Interest Payment
Date in respect of such Security, but will be payable on such Interest Payment
Date, subject to the provisions of Section 3.07, only to the Person to whom
interest in respect of such portion of such Global Security is payable in
accordance with the provisions of this Indenture.
Definitive Securities issued in exchange for all or a part of a Global
Security pursuant to this Section 3.04 shall be registered in such names and in
such authorized denominations as the Depositary, pursuant to instructions from
its direct or indirect participants or otherwise, shall instruct the Trustee.
Upon execution and authentication, the Trustee shall deliver such definitive
Securities to the Persons in whose names such definitive Securities are so
registered.
At such time as all interests in a Global Security have been redeemed,
repurchased, converted, canceled, exchanged for definitive Securities, or
transferred to a transferee who receives definitive Securities, such Global
Security shall, upon receipt thereof, be canceled by the Trustee in accordance
with standing procedures and instructions existing between the Depositary and
the Custodian. At any time prior to such cancellation, if any interest in a
Global Security is exchanged for definitive Securities, redeemed, converted,
repurchased or canceled, exchanged for definitive Securities in certificated
form or transferred to a transferee who receives definitive Securities therefor
or any definitive Security is exchanged or transferred for part of a Global
Security, the principal amount of such Security shall, in accordance with the
standing procedures and instructions existing between the Depositary and the
Custodian, be appropriately reduced or increased, as the case may be, and an
endorsement shall be made on such Global Security, by the Trustee or the
Custodian, at the direction of the Trustee, to reflect such reduction or
increase.
SECTION 3.05. Temporary Securities. Pending the preparation of definitive
Securities, the Company may execute and the Trustee or an Authenticating Agent
shall, upon the written request of the Company, authenticate and deliver
temporary Securities (printed or lithographed). Temporary Securities shall be
issuable in any authorized denomination, and substantially in the form of the
Securities in certificated form, but with such omissions, insertions and
variations as may be appropriate for temporary Securities, all as may be
determined by the Company. Every such temporary Security shall be executed by
the Company and authenticated by the Trustee or such Authenticating Agent upon
the same conditions and in substantially the same manner, and with the same
effect, as the definitive Securities. Without unreasonable delay the Company
will execute and deliver to the Trustee or such Authenticating Agent Securities
and thereupon any or all temporary Securities may be surrendered in exchange
therefor, at each office or agency maintained by the Company and the Trustee or
such Authenticating Agent shall authenticate and make available for delivery in
exchange for such temporary Securities an equal aggregate principal amount of
definitive Securities. Such exchange shall be made by the Company at its own
expense and without any charge therefor. Until so exchanged, the temporary
Securities shall in all respects be entitled to the same benefits and subject to
the same limitations under this Indenture as Securities authenticated and
delivered hereunder.
SECTION 3.06. Mutilated, Destroyed, Lost or Stolen Securities. If any
mutilated Security is surrendered to the Trustee or to a Note Registrar, the
Company shall execute, the Trustee or an Authenticating Agent shall authenticate
and the Trustee or Note Registrar shall
30
deliver in exchange therefor a new Security of like tenor and principal amount
and bearing a number not contemporaneously outstanding.
If there be delivered to the Company and either to the Trustee or to a Note
Registrar:
(a) evidence to their satisfaction of the destruction, loss or theft
of any Security, and
(b) such security or indemnity as may be satisfactory to the Company
and the Trustee and such Note Registrar to save each of them and any agent
of either of them harmless, then, in the absence of actual notice to the
Company, the Trustee or the Note Registrar that such Security has been
acquired by a bona fide purchaser, the Company shall execute, and upon its
request, the Trustee or an Authenticating Agent shall authenticate and the
Trustee or Note Registrar shall deliver in lieu of any such destroyed, lost
or stolen Security or in exchange for the Security, a new Security of like
tenor and principal amount and bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become
or is about to become due and payable, the Company in its discretion, but
subject to any conversion rights, may, instead of issuing a new Security, pay
such Security.
Upon the issuance of any new Security under this Section 3.06, 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 (other than any
stamp and other duties, if any, which may be imposed in connection therewith by
the United States of America or any political subdivision thereof or therein,
which shall be paid by the Company) and any other expenses (including the fees
and expenses of the Trustee, any Paying Agent and any Note Registrar) connected
therewith.
Every new Security issued pursuant to this Section 3.06 in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and such new Security shall be entitled to all the benefits of this Indenture
equally and proportionately with any and all other Securities duly issued
hereunder.
The provisions of this Section 3.06 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies of any Holder with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.07. Payment of Interest; Interest Rights Preserved. Interest on
any Security which is payable, and is punctually paid or duly provided for, on
any Interest Payment Date shall be paid to the Person in whose name that
Security (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest except (i) that the
interest payable upon redemption (unless the date of redemption is an Interest
Payment Date) will be payable to the person to whom principal amount is payable
and (ii) as set forth in the next succeeding sentence. In the case of any
Security (or portion thereof) which is converted into Common Stock during the
period from, but excluding, a Regular Record Date to, but excluding, the next
succeeding Interest Payment Date either (i) if such Security (or portion
thereof) has been called for redemption on a Redemption Date which occurs during
such period, or is to be
31
redeemed in connection with a Fundamental Change on a Fundamental Change
Redemption Date which occurs during such period, the Company shall not be
required to pay interest on such Interest Payment Date in respect of any such
Security (or portion thereof) except to the extent required to be paid upon
redemption of such Security or portion thereof pursuant to Section 11.07 or
Section 14.01 hereof or (ii) if otherwise, any Security (or portion thereof)
submitted for conversion during such period shall be accompanied by funds equal
to the interest payable on such succeeding Interest Payment Date on the
principal amount so converted in accordance with the provisions of Section 12.02
hereof, unless at the time of conversion there exists a default in the payment
of interest on the Securities. Interest may, at the option of the Company, be
paid by check mailed to the address of such person on the registry kept for such
purposes or by wire transfer in immediately available funds to an account
maintained by such person in the United States; provided that with respect to
any Holder with an aggregate principal amount at maturity equal to or in excess
of $2,000,000, at the request of such Holder in writing the Company shall pay
interest on such Holder's Securities by wire transfer in immediately available
funds.
Any interest on any Security which is payable, but is not punctually paid
or duly provided for, on any Interest Payment Date (herein called "Defaulted
Interest") shall forthwith cease to be payable to the Holder on the relevant
Regular Record Date by virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in clause (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each Security, and
the date of the proposed payment, and at the same time the Company shall
deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date
of the proposed payment, such money when deposited to be held in trust for
the benefit of the Persons entitled to such Defaulted Interest as in this
clause provided. Thereupon, the Trustee shall fix the Special Record Date
for the payment of such Defaulted Interest, which shall be not more than 15
days and not less than 10 days prior to the date of the proposed payment
and not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest and
the Special Record Date therefor to be mailed, first-class postage prepaid,
to each Holder of Securities at such Holder's address as it appears in the
Note Register, not less than 10 days prior to such Special Record Date.
Notice of the proposed payment of such Defaulted Interest and the Special
Record Date therefor having been so mailed, such Defaulted Interest shall
be paid to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on such
Special Record Date and shall no longer be payable pursuant to the
following clause (b).
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(b) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause,
such manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
SECTION 3.08. Persons Deemed Owners. Prior to due presentment of a
Security for registration of transfer, the Company or the Trustee and any agent
of the Company or the Trustee may treat the Person in whose name such Security
is registered as the owner of such Security for the purpose of receiving payment
of principal, Redemption Price, Fundamental Change Redemption Price, and
(subject to Section 3.07) interest, if any, in respect of such Security and for
all other purposes whatsoever, whether or not such Security be overdue, and
neither the Company, the Trustee nor any agent of the Company or the Trustee
shall be affected by notice to the contrary.
None of the Company, the Trustee, any Paying Agent or the Note Registrar
will have any responsibility or liability for any aspect of the records relating
to or payments made on account of beneficial ownership interests of a Security
in global form or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests.
Notwithstanding the foregoing, with respect to any Global Security, 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 any Depositary, as a Holder, with respect to such
Global Security or impair, as between such Depositary and owners of beneficial
interests in such Global Security, the operation of customary practices
governing the exercise of the rights of such Depositary (or its nominee) as
Holder of such Global Security.
SECTION 3.09. Cancellation. All Securities surrendered for payment,
redemption, repurchase, registration of transfer or exchange or conversion
shall, if surrendered to any Person other than the Trustee, be delivered to the
Trustee. All Securities so delivered to the Trustee shall be canceled promptly
by the Trustee. No Securities shall be authenticated in lieu of or in exchange
for any Securities canceled as provided in this Section 3.09. The Trustee shall
destroy all canceled Securities in accordance with applicable law and its
customary practices in effect from time to time.
SECTION 3.10. Computation of Interest. Interest on the Securities shall
be computed on the basis of a 360-day year of twelve 30-day months.
SECTION 3.11. CUSIP Numbers. The Company in issuing Securities may use
"CUSIP" numbers (if then generally in use) in addition to serial numbers; if so,
the Trustee shall use such "CUSIP" numbers in addition to serial numbers in
notices of redemption and repurchase as a
33
convenience to Holders; provided that any such notice may state that no
representation is made as to the correctness of such CUSIP numbers either as
printed on the Securities or as contained in any notice of a redemption or
repurchase and that reliance may be placed only on the serial or other
identification numbers printed on the Securities, and any such redemption or
repurchase shall not be affected by any defect in or omission of such CUSIP
numbers. The Company will promptly notify the Trustee of any changes in the
"CUSIP" numbers.
ARTICLE 4
SATISFACTION AND DISCHARGE
SECTION 4.01. Satisfaction and Discharge of Indenture. This Indenture
shall, upon an Issuer Request, cease to be of further effect (except as to any
surviving rights of conversion, or registration of transfer or exchange, or
replacement of Securities herein expressly provided for and the Company's
obligations to the Trustee pursuant to Section 6.07), and the Trustee, at the
expense of the Company, shall execute proper instruments in form and substance
satisfactory to the Trustee acknowledging satisfaction and discharge of this
Indenture, when
(a) either
(i) all Securities theretofore authenticated and delivered (other
than (A) Securities which have been destroyed, lost or stolen and
which have been replaced or paid as provided in Section 3.06 and (B)
Securities for whose payment money has theretofore been deposited with
the Trustee or the Paying Agent in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 10.03) have been
delivered to the Trustee for cancellation; or
(ii) all such Securities not theretofore delivered to the Trustee
or the Paying Agent or its agent for cancellation (other than
Securities referred to in clauses (A) and (B) of clause (a)(i) above)
(A) have become due and payable, or
(B) will have become due and payable at their Stated
Maturity within one year, or
(C) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice
of redemption by the Trustee in the name, and at the expense, of
the Company,
and the Company, in the case of clause (A), (B) or (C) above, has deposited
or caused to be deposited with the Trustee as trust funds (immediately
available to the Holders in the case of clause (A)) in trust for the
purpose an amount sufficient to pay and discharge the entire indebtedness
on such Securities not theretofore delivered to the Trustee for
cancellation, for the principal, Redemption Price and Fundamental Change
Redemption Price, and interest, if any, to the date of such deposit in the
case of Securities which have
34
become due and payable or to the Stated Maturity, Redemption Date or
Fundamental Change Redemption Date, as the case may be;
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(c) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.07, the obligations of
the Company to any Authenticating Agent under Section 6.12 and, if money shall
have been deposited with the Trustee pursuant to clause (a)(ii) of this Section
4.01, the obligations of the Trustee under Section 4.02 and the last paragraph
of Section 10.03 shall survive. Funds held in trust pursuant to this Section are
not subject to the provisions of Article 13.
SECTION 4.02. Application of Trust Money. Subject to the provisions of
the last paragraph of Section 10.03, all money deposited with the Trustee
pursuant to Section 4.01 shall be held in trust and applied by it, in accordance
with the provisions of the Securities and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine to the Persons entitled thereto, of
the principal, Redemption Price, Fundamental Change Redemption Price, and
interest, if any, for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law.
All moneys deposited with the Trustee pursuant to Section 4.01 (and held by
it or any Paying Agent) for the payment of Securities subsequently converted
shall be returned to the Company upon an Issuer Request.
ARTICLE 5
REMEDIES
SECTION 5.01. Events of Default. "Event of Default", wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be occasioned by the provisions of Article
13 or be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(a) default in the payment of the principal, Redemption Price, or
Fundamental Change Redemption Price, on any Security as and when the same
shall become due and payable, including at Maturity or in connection with
any redemption or repurchase, whether or not such payment is prohibited by
the subordination provisions of Article 13; or
(b) default in the payment of any interest upon any Security when it
becomes due and payable, and continuance of such default for a period of 30
days, whether or not such payment is prohibited by the subordination
provisions of Article 13; or
35
(c) default in the performance, or breach, of any covenant or warranty
of the Company, in this Indenture (other than a covenant or warranty a
default in the performance or breach of which is specifically dealt with
elsewhere in this Section), and continuance of such default or breach for a
period of 60 days after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee by
the Holders of at least 25% in aggregate principal amount of the
Outstanding Securities a written notice specifying such default or breach
and requiring it to be remedied and stating that such notice is a "Notice
of Default" hereunder; or
(d) the entry by a court having jurisdiction in the premises of (i) a
decree or order for relief in respect of the Company or any Significant
Subsidiary in an involuntary case or proceeding under any applicable
bankruptcy, moratorium of payments, insolvency, reorganization or other
similar law or (ii) a decree or order adjudging the Company or any
Significant Subsidiary bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company or any Significant Subsidiary
under any applicable federal or state law, or appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator or other similar
official of the Company or any Significant Subsidiary or of substantially
all of the Company or Significant Subsidiary's property, as the case may
be, or ordering the winding up or liquidation of the Company or Significant
Subsidiary's affairs and the continuance of any such decree or order
unstayed and in effect for a period of 60 consecutive days; or
(e) the commencement by the Company or any Significant Subsidiary of a
voluntary case or proceeding under any applicable bankruptcy, moratorium of
payments, insolvency, reorganization or other similar law or of any other
case or proceeding to be adjudicated a bankrupt or insolvent or to be
granted moratorium of payment, or the consent by the Company or any
Significant Subsidiary to the entry of a decree or order for relief in
respect of the Company or Significant Subsidiary, as the case may be, in an
involuntary case or proceeding under any applicable bankruptcy, moratorium
of payment, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy, moratorium of payment or insolvency
proceedings against the Company or any Significant Subsidiary, or the
filing by the Company or any Significant Subsidiary of a petition or
consent seeking reorganization or similar relief under any applicable law,
or the consent by the Company or any Significant Subsidiary to the filing
of such petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or Significant Subsidiary, as the case may
be, or of substantially all of the property of the Company or Significant
Subsidiary, as the case may be, or the making by the Company or any
Significant Subsidiary of an assignment for the benefit of creditors, or
the admission by the Company or any Significant Subsidiary in writing of
its inability to pay its debts generally as they become due, or the taking
of corporate action by the Company or any Significant Subsidiary in
furtherance of any such action; provided that a liquidation or winding up
of a Significant Subsidiary pursuant to applicable corporate law shall not
be deemed to be an Event of Default hereunder.
36
SECTION 5.02. Acceleration of Maturity; Rescission and Annulment. If an
Event of Default (other than an Event of Default specified in Section 5.01(d) or
(e) with respect to the Company) occurs and is continuing, then in every such
case the Trustee or the Holders of not less than 25% in aggregate principal
amount of the Outstanding Securities may declare the principal of (and premium,
if any) and the interest accrued thereon to be due and payable immediately, by a
notice in writing to the Company (and to the Trustee if given by the Holders),
and upon any such declaration the same shall become immediately due and payable.
If an Event of Default specified in Section 5.01(d) or (e) occurs with respect
to the Company, the principal of (and premium, if any) and accrued interest on
all the Securities then Outstanding shall ipso facto become immediately due and
payable without any declaration or other Act of the Holders or any act on the
part of the Trustee.
At any time after such declaration of acceleration has been made and before
a judgment or decree for payment of the money due has been obtained by the
Trustee as hereinafter in this Article 5 provided, the Holders of a majority in
aggregate principal amount of the Outstanding Securities, by written notice to
the Company and the Trustee, may rescind and annul such declaration and its
consequences if
(a) The Company has paid or deposited with the Trustee a sum
sufficient to pay
(i) all overdue interest on all Securities;
(ii) the principal, Redemption Price and Fundamental Change
Redemption Price in respect of any Securities which have become due
otherwise than by such declaration of acceleration and any interest
thereon at the rate borne by the Securities;
(iii) to the extent that payment of such interest is lawful,
interest upon overdue interest at the rate borne by the Securities;
and
(iv) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel; and
(b) all Events of Default, other than the nonpayment of the principal,
Redemption Price, Fundamental Change Redemption Price, or any interest, in
respect of Securities which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 5.13.
No rescission or annulment referred to above shall affect any subsequent
default or impair any right consequent thereon.
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by
Trustee. The Company covenants that, if
(a) default is made in the payment of any interest on any Security when it
becomes due and payable and such default continues for a period of 30 days, or
37
(b) default is made in the payment of the principal, Redemption Price or
Fundamental Change Redemption Price, as and when the same shall become due and
payable, including at Maturity or in connection with any redemption or
repurchase,
the Company will, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Securities, the whole amount then due and payable
on such Securities for the principal, Redemption Price or Fundamental Change
Redemption Price, or interest, if any, with interest on the overdue principal,
Redemption Price and Fundamental Change Redemption Price and on any overdue
interest, to the extent permitted by law, at the rate borne by the Securities,
and in addition thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any such rights, whether for
the specific enforcement of any covenant or agreement in this Indenture or in
aid of the exercise of any power granted herein, or to enforce any other proper
remedy.
SECTION 5.04. Trustee May File Proofs of Claim. In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, moratorium of
payments, reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon the Securities or
the property of the Company or of such other obligor or the creditors of either,
the Trustee (irrespective of whether the principal, Redemption Price,
Fundamental Change Redemption Price, and any interest 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 for the payment of overdue principal, Redemption Price,
Fundamental Change Redemption Price or interest in respect of the Securities)
shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(a) to file and prove a claim for the whole amount of the principal,
Redemption Price, Fundamental Change Redemption Price and interest, if any,
owing and unpaid in respect of the Securities and take such other actions,
including participating as a member, voting or otherwise, of any official
committee of creditors appointed in such matter, and to file such other
papers or documents, in each of the foregoing cases, as may be necessary or
advisable in order to have the claims of the Trustee (including any claim
for the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel) and of the Holders of Securities
allowed in such judicial proceeding, and
38
(b) to collect and receive any moneys or other property payable or
deliverable on any such claim and to distribute the same after deduction of
any amounts due the Trustee under Section 6.07;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders of Securities to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel and any other amounts due the Trustee under Section 6.07.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a Security
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder of a Security in any such proceeding;
provided, however, that the Trustee may, on behalf of such Holders, vote for the
election of a trustee in bankruptcy or similar official.
SECTION 5.05. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may be
prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, be for the ratable benefit of
the Holders of the Securities in respect of which judgment has been recovered.
SECTION 5.06. Application of Money Collected. Any money collected by the
Trustee pursuant to this Article 5 shall be applied in the following order, at
the date or dates fixed by the Trustee and, in case of the distribution of such
money on account of principal, Redemption Price, Fundamental Change Redemption
Price, or interest, upon presentation of the Securities and the notation thereon
of the payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
6.07;
SECOND: Subject to the provisions of Article 13, in case the
principal of the outstanding Securities shall not have become due and be
unpaid, to the payment of interest on the Securities in default in the
order of the maturity of the installments of such interest, with interest
(to the extent that such interest has been collected by the Trustee) upon
the overdue installments of interest at the rate borne by the Securities,
such payments to be made ratably to the persons entitled thereto;
THIRD: Subject to the provisions of Article 13, in case the
principal, Redemption Price or Fundamental Change Redemption Price and
interest, if any, in respect of the outstanding Securities shall have
become due, by declaration or otherwise, and be unpaid, to the payment of
the whole amount then owing and unpaid upon the Securities for principal,
Redemption Price, Fundamental Change Redemption Price and
39
interest, if any, with interest on the overdue principal, Redemption Price
and Fundamental Change Redemption Price, and (to the extent that such
interest has been collected by the Trustee) upon overdue installments of
interest at the rate borne by the Securities; and in case such monies shall
be insufficient to pay in full the whole amounts so due and unpaid upon the
Securities, then to the payment of such aggregate principal, Redemption
Price, Fundamental Change Redemption Price and interest, if any, without
preference or priority of principal, Redemption Price or Fundamental Change
Redemption Price over interest, or of interest over principal, Redemption
Price or Fundamental Change Redemption Price or of any installment of
interest over any other installment of interest, or of any Security over
any other Security, ratably to the aggregate of such principal, Redemption
Price, Fundamental Change Redemption Price and accrued and unpaid interest;
FOURTH: Subject to the provisions of Article 13, to the payment of
the remainder, if any, to the Company or any other Person or Persons
lawfully entitled thereto.
SECTION 5.07. Limitation on Suits. No Holder of any Security shall have
any right to institute any proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee, or for any
other remedy hereunder, unless:
(a) such Holder has previously given written notice to the Trustee of
a continuing Event of Default;
(b) the Holders of not less than 25% in aggregate principal amount of
the Outstanding Securities shall have made written request to the Trustee
to institute proceedings in respect of such Event of Default in its own
name as Trustee hereunder;
(c) such Holder or Holders have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to
be incurred in compliance with such request;
(d) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(e) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
aggregate principal amount of the Outstanding Securities;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all such
Holders.
SECTION 5.08. Unconditional Right of Holders to Receive Principal,
Redemption Price, Fundamental Change Redemption Price and Interest and to
Convert. Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is
40
absolute and unconditional, to receive payment of the principal, Redemption
Price, Fundamental Change Redemption Price and accrued interest on such
Security, on or after the respective due dates expressed in such Security, and
to convert such Security in accordance with Article 12, and to institute suit
for the enforcement of any such payment and right to convert, and such rights
shall not be impaired without the consent of such Holder.
SECTION 5.09. Restoration of Rights and Remedies. If the Trustee or any
Holder of a Security has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders of Securities shall be
restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and such Holders shall
continue as though no such proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities in the last paragraph of Section 3.06, no right or
remedy herein conferred upon or reserved to the Trustee or to the Holders of
Securities is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not Waiver. No delay or omission of the
Trustee or of any Holder of any Security to exercise any right or remedy
accruing upon any Event of Default shall impair any such right or remedy or
constitute a waiver of any such Event of Default or any acquiescence therein.
Every right and remedy given by this Article 5 or by law to the Trustee or to
the Holders of Securities may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee or (subject to the limitations contained
in this Indenture) by the Holders of Securities, as the case may be.
SECTION 5.12. Control by Holders of Securities. Subject to Section
6.03(f), the Holders of a majority in aggregate principal amount of the
Outstanding Securities shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on the Trustee; provided that
(a) such direction shall not be in conflict with any rule of law or
with this Indenture;
(b) The Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction;
(c) the Trustee need not take any action which might result in
personal liability or be unjustly prejudicial to the Holders of Securities
not consenting; and
(d) such direction shall be presented by such Holders to the Trustee
in a timely manner.
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SECTION 5.13. Waiver of Past Defaults. The Holders, either (a) through
the written consent of not less than a majority in aggregate principal amount of
the Outstanding Securities, or (b) by the adoption of a resolution, at a meeting
of Holders of the Outstanding Securities at which a quorum is present, by the
Holders of not less than a majority in aggregate principal amount of Outstanding
Securities represented at such meeting, may on behalf of the Holders of all the
Securities waive any past default hereunder and its consequences, except (i) in
the payment of the principal, Redemption Price, Fundamental Change Redemption
Price or interest, if any, in respect of the Securities, (ii) a failure by the
Company to convert any Securities into Common Stock, or (iii) in respect of a
covenant or provision hereof which under Article 8 cannot be modified or amended
without the consent of the Holder of each Outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
SECTION 5.14. Undertaking for Costs. All parties to this Indenture agree,
and each Holder of any Security by his or her acceptance thereof shall be deemed
to have agreed, that any court may in its discretion require, in any suit for
the enforcement of any right or remedy under this Indenture, or in any suit
against the Trustee for any action taken, suffered or omitted by it as Trustee,
the filing by any party litigant in such suit of an undertaking to pay the costs
of such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; provided that the provisions of this Section 5.14 shall not
apply to any suit instituted by the Trustee, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% in aggregate
principal amount at maturity of the Securities outstanding, or to any suit
instituted by any Holder for the enforcement of the payment of the principal,
Redemption Price, Fundamental Change Redemption Price and interest, if any, in
respect of any Security on or after the due date expressed in such Security or
to any suit for the enforcement of the right to convert any Security in
accordance with the provisions of Article 12.
SECTION 5.15. Waiver of Stay, Extension and Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay, extension law or usury law or other law that
would prohibit or forgive the Company from paying all or any portion of its
obligations on the Securities as provided herein, wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and the Company (to the extent 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.
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ARTICLE 6
THE TRUSTEE
SECTION 6.01. Certain Duties and Responsibilities. (a) Except during the
continuance of an Event of Default,
(i) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture, and no implied covenants
or obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture; but in
the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture, but not to verify the
contents thereof.
(b) In case an Event of Default has occurred (which has not been cured or
waived and of which a Responsible Officer has actual knowledge), the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of such person's
own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
(i) this paragraph (c) shall not be construed to limit the effect of
paragraph (a) of this Section;
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of a majority in aggregate principal amount of the
Outstanding Securities or such lesser percentage as provided in this
Indenture relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred upon the Trustee, under this Indenture.
(d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
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(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability has not been provided
to it.
SECTION 6.02. Notice of Defaults. Within 90 days after the occurrence of
any default hereunder as to which the Trustee has received written notice, the
Trustee shall give to all Holders of Securities, in the manner provided in
Section 1.06, notice of such default, unless such default shall have been cured
or waived; provided, however, that, except in the case of a default in the
payment of the principal, Redemption Price, Fundamental Change Redemption Price
or interest, if any, in respect of any Security, the Trustee shall be protected
in withholding such notice if and so long as the board of directors, the
executive committee or a trust committee of directors or Responsible Officers of
the Trustee in good faith determines that the withholding of such notice is in
the interest of the Holders. For the purpose of this Section, the term "default"
means any event which is, or after notice or lapse of time or both would become,
an Event of Default.
SECTION 6.03. Certain Rights of Trustee. Subject to the provisions of
Section 6.01:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, Officers' Certificate, other
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, coupon, 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) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Issuer Request or Issuer Order, and any
resolution of the Board shall be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Holders of Securities pursuant to this Indenture, unless such
Holders shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which might be incurred by it
in compliance with such request or direction;
(f) 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,
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request, direction, consent, order, bond, debenture, note, coupon, other
evidence of indebtedness or other paper or document, but the Trustee in its
sole discretion may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine
the books, records and premises of the Company, personally or by agent or
attorney;
(g) 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;
(h) the permissive right of the Trustee to take or refrain from taking
any actions enumerated in this Indenture shall not be construed as a duty
and the Trustee shall not be answerable in such actions other than for its
own negligence, bad faith or willful misconduct in exercising any such
right; and
(i) the Trustee shall not be liable for any action taken, suffered or
omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by the Indenture.
SECTION 6.04. Not Responsible for Recitals or Issuance of Securities. The
recitals contained herein and in the Securities (except the Trustee's
certificates of authentication) shall be taken as the statements of the Company,
and the Trustee or any Authenticating Agent assumes no responsibility for their
correctness. The Trustee makes no representations as to the validity or
sufficiency of this Indenture, of the Securities or of the Common Stock issuable
upon the conversion of the Securities. The Trustee or any Authenticating Agent
shall not be accountable for the use or application by the Company of Securities
or the proceeds thereof.
SECTION 6.05. May Hold Securities, Act as Trustee Under Other Indentures.
The Trustee, any Authenticating Agent, any Paying Agent, any Conversion Agent or
any other agent of the Company or the Trustee, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with the Company with the same rights it would have if it were not the Trustee,
Authenticating Agent, Paying Agent, Conversion Agent or such other agent.
The Trustee may become and act as trustee under other indentures under
which other securities, or certificates of interest or participation in other
securities, of the Company are outstanding in the same manner as if it were not
Trustee hereunder.
SECTION 6.06. Money Held in Trust. Money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing with the Company.
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SECTION 6.07. Compensation and Reimbursement. 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
by any provision of law in regard to the compensation of a trustee of an
express trust);
(b) except as otherwise expressly provided herein, 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
and disbursements of its agents and counsel), except for any such expense,
disbursement or advance as may be attributable to its negligence, bad faith
or willful misconduct. The Trustee agrees to repay such expenses,
disbursements and advances attributable to its negligence, bad faith or
willful misconduct upon the entry of a final nonappealable determination
that the Trustee engaged in negligence, bad faith or willful misconduct;
and
(c) to indemnify the Trustee (and its directors, officers, employees
and agents) for, and to hold it harmless against, any loss, liability or
expense incurred without negligence, bad faith or willful misconduct on its
part, arising out of or in connection with the acceptance or administration
of this trust, including the costs, expenses and reasonable attorneys' fees
of defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 5.01(d) or Section 5.01(e) in the case of
the Company, or any Significant Subsidiary, the expenses (including the
reasonable charges of its counsel) and the compensation for the services are
intended to constitute expenses of the administration under any applicable
Federal or state bankruptcy, insolvency or other similar law.
Any Paying Agent or Authenticating Agent appointed hereunder shall be
entitled to the benefits of Section 6.07(c) as if the indemnity set forth
therefor were specifically afforded to such Paying Agent or Authenticating
Agent.
The provisions of this Section shall survive the termination of this
Indenture or the earlier resignation or removal of the Trustee, any Paying Agent
or any Authenticating Agent, as the case may be. The obligations of the Company
under this Section to compensate the Trustee, to pay or reimburse the Trustee
for expenses, disbursements and advances and to indemnify and hold harmless the
Trustee shall constitute additional indebtedness hereunder and shall survive the
satisfaction and discharge of this Indenture. As security for the performance
of such obligations of the Company, the Trustee shall have a claim prior to the
Securities upon all property and funds held or collected by the Trustee as such,
except funds held in trust for the payment of principal, Redemption Price,
Fundamental Change Redemption Price, or interest with respect to particular
Securities.
SECTION 6.08. Corporate Trustee Required; Eligibility. There shall at all
times be a Trustee hereunder which shall be a Person that is eligible pursuant
to the Trust Indenture Act to
46
act as such, having (or if the Trustee is a member of a bank holding company,
its bank holding company has) a combined capital and surplus of at least
U.S.$50,000,000, subject to supervision or examination by Federal or state
authority, in good standing. If such corporation publishes reports of condition
at least annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article and a successor shall be
appointed pursuant to Section 6.09.
SECTION 6.09. Resignation and Removal; Appointment of Successor. (a) No
resignation or removal of the Trustee and no appointment of a successor Trustee
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Trustee in accordance with the applicable
requirements of Section 6.10.
(b) The Trustee may resign at any time by giving written notice thereof to
the Company. If the instrument of acceptance by a successor Trustee required by
Section 6.10 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in aggregate principal amount of the Outstanding Securities, delivered
to the Trustee and the Company. If the instrument of acceptance by a successor
Trustee required by Section 6.10 shall not have been delivered to the Trustee
within 30 days after the giving of such notice of removal, the removed Trustee
may petition any court of competent jurisdiction for the appointment of a
successor Trustee.
(d) If at any time:
(i) the Trustee shall cease to be eligible under Section 6.08 and
shall fail to resign after written request therefor by the Company or by
any Holder of a Security who has been a bona fide Holder of a Security for
at least six months, or
(ii) the Trustee shall become incapable of acting, or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case (i) the Company by Board Resolutions may remove the
Trustee, or (ii) subject to Section 5.14, any Holder of a Security who has been
a bona fide Holder of a Security for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
(e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Company,
by Board Resolutions,
47
shall promptly appoint a successor Trustee and shall comply with the applicable
requirements of this Section and Section 6.10. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee shall be appointed by Act of the Holders of a majority in
aggregate principal amount of the Outstanding Securities delivered to the
Company and the retiring Trustee, the successor Trustee so appointed shall,
forthwith upon its acceptance of such appointment in accordance with the
applicable requirements of Section 6.10, become the successor Trustee and
supersede the successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders of Securities
and accepted appointment in the manner required by this Section and Section
6.10, any Holder of a Security who has been a bona fide Holder of a Security for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(f) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee to all Holders of
Securities in the manner provided in Section 1.06. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.
SECTION 6.10. Acceptance of Appointment by Successor. Every successor
Trustee appointed hereunder shall execute, acknowledge and deliver to the
Company and to the retiring Trustee an instrument accepting such appointment,
and thereupon the resignation or removal of the retiring Trustee shall become
effective and such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties
of the retiring Trustee; but, on the request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder. Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be eligible under this Article.
SECTION 6.11. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with which
it may be consolidated, or any corporation resulting from any merger, conversion
or consolidation to which the Trustee shall be a party, or any corporation
succeeding to all or substantially all of the corporate trust business of the
Trustee (including the trust created by this Indenture), shall be the successor
of the Trustee hereunder, provided such corporation shall be otherwise eligible
under this Article, without the execution or filing of any paper or any further
act on the part of any of the parties hereto. In case any Securities shall have
been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Securities so authenticated with
the same effect as if such successor Trustee had itself authenticated such
Securities.
48
SECTION 6.12. Authenticating Agents. The Trustee may appoint an
additional Authenticating Agent or Agents with respect to the Securities which
shall be authorized to act on behalf of the Trustee to authenticate Securities
issued upon exchange or substitution pursuant to this Indenture.
Securities authenticated by an Authenticating Agent shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder, and every reference in
this Indenture to the authentication and delivery of Securities by the Trustee
or the Trustee's certificate of authentication shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Company and shall at all times be a corporation organized and doing business
under the laws of the United States of America, any State thereof, the District
of Columbia authorized under such laws to act as Authenticating Agent and
subject to supervision or examination by government or other fiscal authority.
If at any time an Authenticating Agent shall cease to be eligible in accordance
with the provisions of this Section 6.12, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in this Section 6.12.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate agency or corporate trust business of an Authenticating Agent
(including the duties under this Indenture), shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise eligible
under this Section 6.12, without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Company. Upon receiving such a notice
of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 6.12, the Trustee may appoint a successor
Authenticating Agent which shall be subject to acceptance by the Company. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section 6.12.
The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section 6.12 and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 6.07.
If an Authenticating Agent is appointed with respect to the Securities
pursuant to this Section 6.12, the Securities may have endorsed thereon, in
addition to or in lieu of the Trustee's certification of authentication, an
alternative certificate of authentication in the following form:
49
This is one of the Securities referred to in the within-mentioned
Indenture.
Dated: [ ]
---------------------------------
as Trustee
By [Authenticating Agent],as Authenticating
Agent
By:
-------------------------
Authorized Signatory
SECTION 6.13. Disqualification; Conflicting Interest. If the Trustee has
or shall acquire a conflicting interest within the meaning of the Trust
Indenture Act, the Trustee shall either eliminate such interest or resign, to
the extent and in the manner provided by, and subject to the provisions of, the
Trust Indenture Act and this Indenture.
SECTION 6.14. Preferential Collection of the Claims Against the Company.
If and when the Trustee shall be or become a creditor of the Company (or any
other obligor upon the Securities), the Trustee shall be subject to the
provisions of Section 311 of the Trust Indenture Act regarding the collection of
claims against the Company (or any such other obligor).
ARTICLE 7
CONSOLIDATION, MERGER, TRANSFER OR LEASE
SECTION 7.01. The Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate or merge into any other Person or convey,
transfer or lease its properties and assets substantially as an entirety to any
other Person and shall not transfer and assign all its obligations of, and
position as, the issuer hereunder, except for a consolidation or merger in which
the Company is the surviving party, unless:
(a) the Person formed by such consolidation or into which the Company
is merged or which acquires by conveyance or transfer the properties and
assets of the Company substantially as an entirety, or to which obligations
of, and position as, the issuer hereunder are transferred and assigned (the
"Successor") (i) shall be a corporation, limited liability company,
partnership or trust organized and existing under the laws of, and resident
for tax purposes in, the United States of America or any political
subdivision thereof, and (ii) shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, due and punctual payment of the principal,
Redemption Price, Fundamental Change Redemption Price and interest, if any,
on all of the Securities and the performance of every covenant of this
Indenture and in the Securities on the part of the Company to be performed
or observed;
(b) immediately after giving effect to any such consolidation, merger,
conveyance, transfer or lease, or such transfer and assignment, no default
and no Event of Default shall have occurred and be continuing; and
50
(c) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease, or such transfer and assignment, and such
supplemental indenture comply with this Article and that all conditions
precedent herein provided for relating to such transaction have been
complied with.
SECTION 7.02. Successor Substituted. Upon any consolidation, merger or
any conveyance, transfer or lease of the properties and assets of the Company
substantially as an entirety, or upon transfer and assignment of all obligations
of, and position as, the issuer hereunder, in accordance with Section 7.01, the
Successor shall succeed to and be substituted for, and may exercise every right
and power of, the Company under this Indenture with the same effect as if such
Successor had been named as the issuer herein. The Successor thereupon may
cause to be signed, and may issue either in its own name or in the name of
Ventro Corporation, any or all of the Securities issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Trustee; and, upon the order of the Successor instead of the Company and subject
to all the terms, conditions and limitations in this Indenture prescribed, the
Trustee shall authenticate and shall deliver any Securities which previously
shall have been signed and delivered by the officers of the Company to the
Trustee for authentication, and any Securities which the Successor thereafter
shall cause to be signed and delivered to the Trustee for that purpose. All the
Securities so issued shall in all respects have the same legal rank and benefit
under this Indenture as the Securities theretofore or thereafter issued in
accordance with the terms of this Indenture as though all of such Securities had
been issued at the date of the execution hereof. In the event of any such
consolidation, merger, sale, conveyance or lease, the person named as the
"Company" in the first paragraph of this Indenture or any successor which shall
thereafter have become such in the manner prescribed in this Article 7 may be
dissolved, wound up and liquidated at any time thereafter and such person shall
be released from its liabilities as obligor and maker of the Securities and from
its obligations under this Indenture.
In case of any such consolidation, merger, sale, conveyance or lease, such
changes in phraseology and form (but not in substance) may be made in the
Securities thereafter to be issued as may be appropriate.
ARTICLE 8
SUPPLEMENTAL INDENTURES
SECTION 8.01. Supplemental Indentures Without Consent of Holders of
Securities. Without the consent of any Holders of Securities, the Company, when
authorized by Board Resolutions, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto in form
satisfactory to the Trustee for any of the following purposes:
(a) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants and obligations of
the Company herein and in the Securities as permitted by this Indenture; or
(b) to add to the covenants of the Company for the benefit of the
Holders of Securities, or to surrender any right or power herein conferred
upon the Company; or
51
(c) to add any additional Events of Default; or
(d) to provide for the issuance under this Indenture of Securities in
coupon form (including Securities registrable as to principal only) and to
provide for exchangeability of such Securities with the Securities issued
hereunder in fully registered form and to make all appropriate changes for
such purpose; or
(e) to secure the Securities; or
(f) to provide for successor or additional trustees; or
(g) to make provision with respect to the conversion rights of Holders
of Securities pursuant to Section 12.11 or the repurchase rights of Holders
of Securities pursuant to Section 14.03; or
(h) to comply with the requirements of the Trust Indenture Act or the
rules and regulations of the Commission thereunder in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act,
as contemplated by this Indenture or otherwise; or
(i) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein or which
is otherwise defective, or to make any other provisions with respect to
matters or questions arising under this Indenture as the Company and the
Trustee may deem necessary or desirable, provided, such action pursuant to
this clause (i) shall not adversely affect the interests of the Holders of
Securities in any material respect.
Upon the receipt by the Trustee of an Issuer Request, accompanied by Board
Resolutions authorizing the execution of any such supplemental indenture, and
subject to and upon receipt by the Trustee of the Opinion of Counsel described
in Section 8.03 hereof, the Trustee shall join with the Company in the execution
of any supplemental indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate agreements and stipulations which
may be therein contained.
SECTION 8.02. Supplemental Indentures with Consent of Holders of
Securities. With either (a) the written consent of the Holders of not less than
a majority in aggregate principal amount of the Outstanding Securities, by the
Act of said Holders delivered to the Company and the Trustee, or (b) by the
adoption of a resolution, at a meeting of Holders of the Outstanding Securities
at which a quorum is present, by the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities, the Company, when
authorized by Board Resolutions, and the Trustee may enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of modifying in any manner the rights of the Holders of Securities under this
Indenture; provided, however, that no such supplemental indenture shall:
(i) extend the Stated Maturity of the principal of, or any installment
of interest on, any Security, or reduce the rate or extend the time of
payment of interest payable thereon, or reduce the principal thereof, or
reduce any amount payable upon
52
redemption thereof, change the optional election of the Company to make
redemption of any Security or the obligation of the Company to pay the
Redemption Price upon such election pursuant to Article 11, or impair or
affect the right of any Holder to institute suit for the payment thereof,
or make the principal, Redemption Price, Fundamental Change Redemption
Price or interest, if any, in respect thereof payable in any coin or
currency other than that provided in the Securities, or, except as
permitted by Section 12.11, adversely affect the right to convert any
Security as provided in Article 12, or modify the provisions of this
Indenture with respect to the subordination of the Securities in a manner
adverse to the Holders of Securities, in any material respect, without the
consent of the Holder of each Security so affected, or
(ii) reduce the aforesaid percentage in aggregate principal amount of
the Outstanding Securities the consent of whose Holders is required for any
such supplemental indenture, without the consent of the Holder of each
Outstanding Security.
It shall not be necessary for any Act of Holders of Securities under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
SECTION 8.03. Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Sections
6.01 and 6.03) shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental indenture is authorized or
permitted by this Indenture, and that such supplemental indenture has been duly
authorized, executed and delivered by the Company and constitutes a valid and
legally binding obligation of the Company enforceable against the Company in
accordance with its terms. The Trustee may, but shall not be obligated to, enter
into any such supplemental indenture which affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise.
SECTION 8.04. Effect of Supplemental Indentures. Upon the execution of
any supplemental indenture under this Article, this Indenture shall be modified
in 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.
SECTION 8.05. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article 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 Company and the Trustee, 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 8.06. Notice of Supplemental Indentures. Promptly after the
execution by the Company and the Trustee of any supplemental indenture pursuant
to the provisions of Section 8.02, the Company shall give notice to all Holders
of Securities of such fact, setting forth in
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general terms the substance of such supplemental indenture, in the manner
provided in Section 1.06. Any failure of the Company to give such notice, or any
defect therein, shall not in any way impair or affect the validity of any such
supplemental indenture.
ARTICLE 9
MEETINGS OF HOLDERS OF SECURITIES
SECTION 9.01. Purposes for Which Meetings May Be Called. A meeting of
Holders of Securities may be called at any time and from time to time pursuant
to this Article to make, give or take any request, demand, authorization,
direction, notice, consent, waiver or other action provided by this Indenture to
be made, given or taken by Holders of Securities.
SECTION 9.02. Call, Notice and Place of Meetings. (a) The Trustee may at
any time call a meeting of Holders of Securities for any purpose specified in
Section 9.01, to be held at such time and at such place in [Los Angeles,
California] or in the Borough of Manhattan, The City of New York, as the Trustee
shall determine. Notice of every meeting of Holders of Securities, setting forth
the time and the place of such meeting and in general terms the action proposed
to be taken at such meeting, shall be given, in the manner provided in Section
1.06, not less than 20 nor more than 90 days prior to the date fixed for the
meeting.
(b) In case at any time the Company, pursuant to a Board Resolution, or the
Holders of at least 10% in aggregate principal amount of the Outstanding
Securities shall have requested the Trustee to call a meeting of the Holders of
Securities for any purpose specified in Section 9.01, by written request setting
forth in reasonable detail the action proposed to be taken at the meeting, and
the Trustee shall not have made the first publication of the notice of such
meeting within 20 days after receipt of such request or shall not thereafter
proceed to cause the meeting to be held as provided herein, then the Company or
the Holders of Securities in the amount specified, as the case may be, may
determine the time and the place in the Borough of Manhattan, The City of New
York for such meeting and may call such meeting for such purposes by giving
notice thereof as provided in paragraph (a) of this Section.
SECTION 9.03. Persons Entitled to Vote at Meetings. To be entitled to
vote at any meeting of Holders of Securities, a Person shall be (a) a Holder of
one or more Outstanding Securities on the applicable record date, or (b) a
Person appointed by an instrument in writing as proxy for a Holder or Holders of
one or more Outstanding Securities by such Holder or Holders. The only Persons
who shall be entitled to be present or to speak at any meeting of Holders shall
be the Persons entitled to vote at such meeting and their counsel, any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.
SECTION 9.04. Quorum; Action. The Persons entitled to vote a majority in
aggregate principal amount of the Outstanding Securities shall constitute a
quorum. In the absence of a quorum within 30 minutes of the time appointed for
any such meeting, the meeting shall, if convened at the request of Holders of
Securities, be dissolved. In any other case, the meeting may be adjourned for a
period of not less than 10 days as determined by the chairman of the meeting
prior to the adjournment of such meeting. In the absence of a quorum at any such
reconvened meeting, such reconvened meeting may be further adjourned for a
period not less than 10 days as determined by the chairman of the meeting prior
to the adjournment of such
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reconvened meeting (subject to repeated applications of this sentence). Notice
of the reconvening of any adjourned meeting shall be given as provided in
Section 9.02(a), except that such notice need be given only once not less than
five days prior to the date on which the meeting is scheduled to be reconvened.
Notice of the reconvening of an adjourned meeting shall state expressly the
percentage of the principal amount of the Outstanding Securities which shall
constitute a quorum.
Subject to the foregoing, at the reconvening of any meeting adjourned for a
lack of a quorum, the Persons entitled to vote 25% in aggregate principal amount
of the Outstanding Securities at the time shall constitute a quorum for the
taking of any action set forth in the notice of the original meeting.
At a meeting or an adjourned meeting duly reconvened and at which a quorum
is present as aforesaid, any resolution and all matters (except as limited by
the proviso to Section 8.02) shall be effectively passed and decided if passed
or decided by not less than a majority in aggregate principal amount of the
Outstanding Securities represented and entitled to vote at such meeting.
Any resolution passed or decisions taken at any meeting of Holders of
Securities duly held in accordance with this Section shall be binding on all the
Holders of Securities, whether or not present or represented at the meeting. The
Trustee shall, in the name and at the expense of the Company, notify all the
Holders of Securities of any such resolutions or decisions pursuant to Section
1.06.
SECTION 9.05. Determination of Voting Rights; Conduct and Adjournment of
Meetings. (a) Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Holders of Securities in regard to proof of the holding of Securities
and of the appointment of proxies and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall deem appropriate. Except as otherwise
permitted or required by any such regulations, the holding of Securities shall
be proved in the manner specified in Section 1.04 and the appointment of any
proxy shall be proved in the manner specified in Section 1.04.
(b) The Trustee shall, by an instrument in writing, appoint a temporary
chairman (which may be the Trustee) of the meeting, unless the meeting shall
have been called by the Company or by Holders of Securities as provided in
Section 9.02(b), in which case the Company or the Holders of Securities calling
the meeting, as the case may be, shall in like manner appoint a temporary
chairman. A permanent chairman and a permanent secretary of the meeting shall be
elected by vote of the Persons entitled to vote a majority in aggregate
principal amount of the Outstanding Securities represented at the meeting.
(c) At any meeting, each Holder of a Security or proxy shall be entitled to
one vote for each U.S.$1,000 principal amount of Securities held or represented
by him; provided, however, that no vote shall be cast or counted at any meeting
in respect of any Security challenged as not Outstanding and ruled by the
chairman of the meeting to be not Outstanding.
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The chairman of the meeting shall have no right to vote, except as a Holder of a
Security or proxy.
(d) Any meeting of Holders of Securities duly called pursuant to Section
9.02 at which a quorum is present may be adjourned from time to time by Persons
entitled to vote a majority in aggregate principal amount of the Outstanding
Securities represented at the meeting, and the meeting may be held as so
adjourned without further notice.
SECTION 9.06. Counting Votes and Recording Action of Meetings. The vote
upon any resolution submitted to any meeting of Holders of Securities shall be
by written ballots on which shall be subscribed the signatures of the Holders of
Securities or of their representatives by proxy and the principal amounts and
serial numbers of the Outstanding Securities held or represented by them. The
permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record, at least in
duplicate, of the proceedings of each meeting of Holders of Securities shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more Persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was given as provided in Section 9.02 and, if applicable, Section 9.04.
Each copy shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one such copy shall be delivered to
the Company and another to the Trustee to be preserved by the Trustee, the
latter to have attached thereto the ballots voted at the meeting. Any record so
signed and verified shall be conclusive evidence of the matters therein stated.
ARTICLE 10
COVENANTS
SECTION 10.01. Payment of Principal, Redemption Price, Fundamental Change
Redemption Price and Interest. The Company covenants and agrees that it will
duly and punctually pay the principal, Redemption Price, Fundamental Change
Redemption Price and interest, if any, in respect of the Securities in
accordance with the terms of the Securities and this Indenture. The Company will
deposit or cause to be deposited with the Trustee on or prior to the due date
for any installment of interest thereon or on the Stated Maturity of any
Security all payments so due, which payments shall be in immediately available
funds on the date of such due date or Stated Maturity, as the case may be.
SECTION 10.02. Maintenance of Offices or Agencies. The Company hereby
appoints the Corporate Trust Office of the Trustee in _________________ and the
office or agency of the Trustee in the Borough of Manhattan, The City of New
York, as places where Securities may be presented or surrendered for payment,
where Securities may be surrendered for registration of transfer or exchange,
where Securities may be surrendered for conversion, and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served (which notices and demands shall be promptly forwarded by the
Trustee to the Company).
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The Company may at any time and from time to time vary or terminate the
appointment of any such agent or appoint any additional agents for any or all of
such purposes; provided, however, that until all of the Securities have been
delivered to the Trustee for cancellation, or moneys sufficient to pay the
principal, Redemption Price, Fundamental Change Redemption Price and interest,
if any, in respect of the Securities have been made available for payment and
either paid or returned to the Company pursuant to the provisions of Section
10.03, the Company will maintain in the Borough of Manhattan, The City of New
York, an office or agency where Securities may be presented or surrendered for
payment and conversion, where Securities may be surrendered for registration of
transfer or exchange and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served. The Company will
give prompt written notice to the Trustee, and notice to the Holders in
accordance with Section 1.06, of the appointment or termination of any such
agents and of the location and any change in the location of any such office or
agency.
If at any time the Company shall fail to maintain any such required office
or agency, or shall fail to furnish the Trustee with the address thereof,
presentations and surrenders may be made and notices and demands may be served
on the office or agency of the Trustee in the Borough of Manhattan, the City of
New York.
SECTION 10.03. Money for Security Payments to Be Held in Trust. If the
Company shall act as its own Paying Agent, it will, on or before each due date
of the principal, Redemption Price, Fundamental Change Redemption Price or
interest, if any, in respect of any of the Securities, segregate and hold in
trust for the benefit of the Persons entitled thereto a sum sufficient to pay
the amounts so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and the Company will promptly notify
the Trustee of its action or failure so to act and of any failure by the Company
(or by any other obligor under the Securities) to make any payment of the
principal, Redemption Price, Fundamental Change Redemption Price or interest, if
any, in respect of the Securities when the same shall become due and payable.
Whenever there shall be one or more Paying Agents, the Company will, on or
prior to each due date of the principal, Redemption Price, Fundamental Change
Redemption Price or interest, if any, in respect of any Securities, deposit with
such Paying Agent a sum sufficient to pay such amounts so becoming due, such sum
to be held for the benefit of the Persons entitled to such principal, Redemption
Price, Fundamental Change Redemption Price or interest, if any, and (unless such
Paying Agent is the Trustee) the Company will promptly notify the Trustee of
their action or any failure so to act.
The Company will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will:
(a) hold all sums held by it for the payment of the principal,
Redemption Price, Fundamental Change Redemption Price or interest, if any,
in respect of Securities for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise disposed of as
herein provided;
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(b) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities) in the making of any payment of the
principal, Redemption Price, Fundamental Change Redemption Price or
interest, if any, in respect of the Securities, when the same shall be due
and payable; and
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held by such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Issuer
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
sums.
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of the principal, Redemption Price,
Fundamental Change Redemption Price, or interest, if any, in respect of any
Security and remaining unclaimed for the earlier of ten days prior to the time
such money would escheat to the state or two years after such amount has become
due and payable shall be paid to the Company or (if then held by the Company)
shall be discharged from such trust; and the Holder of such Security shall
thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease.
SECTION 10.04. Corporate Existence. Subject to Article 7, the Company
will do or cause to be done all things necessary to preserve and keep in full
force and effect its existence.
SECTION 10.05. Statement by Officers as to Default. The Company will
deliver to the Trustee within 120 days after the end of each fiscal year of the
Company an Officers' Certificate stating that in the course of performance by
the signers of their duties as such officers of the Company they would normally
obtain knowledge of whether any default exists in the performance and observance
of any of the terms, provisions and conditions of this Indenture and whether the
Company has kept, observed, performed and fulfilled its obligations under this
Indenture. Such Officers' Certificate shall further state, as to each such
officer signing such Certificate, to the best of the knowledge of such officer,
as of the date of such Officers' Certificate, (a) whether any such default
exists, (b) whether the Company during the preceding fiscal year kept, observed,
performed and fulfilled each and every covenant and obligation of the Company
under this Indenture and (c) whether there was any default in the performance
and observance of any of the terms, provisions or conditions of this Indenture
during such preceding fiscal year. If the officer or officers signing the
Officers' Certificate know of such a default, whether then existing or occurring
during such preceding fiscal year, the Officers' Certificate shall describe such
default and its status with particularity. The Company shall also promptly
notify the Trustee if the Company's fiscal year is changed so that the end
thereof is on any date other than the then current fiscal year end date.
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The Company will deliver to the Trustee, forthwith and in any event within
5 days after the Company become aware of any default in the performance or
observance of any covenant, agreement or condition contained in this Indenture,
or any Event of Default, an Officers' Certificate specifying with particularity
such default or Event of Default and further stating what action the Company has
taken, is taking or propose to take with respect thereto.
Any notice required to be given under this Section 10.05 shall be delivered
to the Trustee at its Corporate Trust Office.
ARTICLE 11
REDEMPTION OF SECURITIES
SECTION 11.01. Right of Redemption. The Company may not redeem the
Securities prior to __________, 2003. On or after that date, the Company may,
at its option, redeem all or from time to time any part of the Securities on any
date prior to maturity, upon notice as set forth in Section 11.05, and at the
optional Redemption Prices set forth in the form of Security set forth in
Section 2.02, together with accrued interest, if any, to, but excluding, the
Redemption Date.
SECTION 11.02. Applicability of Article. Redemption of Securities at the
election of the Company or otherwise, as permitted or required by any provision
of the Securities or this Indenture, shall be made in accordance with such
provision and this Article.
SECTION 11.03. Selection to Redeem; Notice to Trustee. The election of
the Company to redeem any Securities shall be evidenced by a Board Resolution.
In case of any redemption at the election of the Company of less than all of the
Securities, the Company shall, at least 45 days prior to the Redemption Date
fixed by the Company (unless a shorter notice shall be satisfactory to the
Trustee), notify the Trustee in writing of such Redemption Date.
SECTION 11.04. Selection by Trustee of Securities to Be Redeemed. If
fewer than all the Securities are to be redeemed, the Trustee shall select, with
written notice to the Company, by lot, pro rata or by another manner as the
Trustee shall deem equitable and fair, the Securities or portions thereof (in
multiples of $1,000 principal amount) to be redeemed. If any Security selected
for partial redemption is converted in part after such selection, the converted
portion of such Security shall be deemed (so far as may be) to be the portion to
be selected for redemption. The Securities (or portions thereof) so selected
shall be deemed duly selected for redemption for all purposes hereof,
notwithstanding that any such Security is converted as a whole or in part before
the mailing of the notice of redemption.
Upon any redemption of less than all the Securities, the Company and the
Trustee may treat as outstanding any Securities surrendered for conversion
during the period of 15 days next preceding the mailing of a notice of
redemption and need not treat as outstanding any Security authenticated and made
available for delivery during such period in exchange for the unconverted
portion of any Security converted in part during such period.
The Trustee shall promptly notify the Company and each Note Registrar in
writing of the securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount thereof to be
redeemed.
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For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
SECTION 11.05. Notice of Redemption. Notice of redemption shall be given
in the manner provided in Section 1.06 to the Holders of Securities to be
redeemed not less than 30 nor more than 60 days prior to the Redemption Date,
and such notice shall be irrevocable. The Company shall also publish a notice of
such redemption at least once in each of Bloomberg Business News, Dow Xxxxx News
(DJN) and Xxxxxx Financial Report in the City of New York (or if any such
publications are not then published, such other publications in the City of New
York of comparable circulation as may be determined by the Company) at least 30
and not more than 60 days prior to the date fixed for redemption.
All notices of redemption shall state:
(a) the Redemption Date,
(b) the Redemption Price,
(c) if less than all Outstanding Securities are to be redeemed, the
aggregate principal amount of Securities to be redeemed and the aggregate
principal amount of Securities which will be outstanding after such partial
redemption,
(d) that on the Redemption Date the Redemption Price and interest
accrued to, but excluding, the Redemption Date will be paid as specified in
said notices, and that on and after said date interest thereon or on the
portions thereof to be redeemed, will cease to accrue,
(e) the Conversion Price then in effect, the date on which the right
to convert the Securities to be redeemed will terminate and the places
where such Securities, may be surrendered for conversion, and
(f) the place or places where such Securities are to be surrendered
for payment of the Redemption Price and accrued interest, if any.
In case of a partial redemption, the notice shall specify the serial and
CUSIP numbers (if any) and the portions thereof called for redemption and that
transfers and exchanges may occur on or prior to the Redemption Date.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, at the Company's written request, by
the Trustee in the name of and at the expense of the Company. Notice of
redemption of Securities to be redeemed at the election of the Company received
by the Trustee shall be given by the Trustee to each Paying Agent in the name of
and at the expense of the Company.
SECTION 11.06. Deposit of Redemption Price. By 10:00 a.m. (New York time)
on any Redemption Date of the Securities, the Company shall deposit with the
Trustee or with the
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Paying Agent so directed by the Trustee (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 10.03) an
amount of money (which shall be in immediately available funds on such
Redemption Date) sufficient to pay the Redemption Price of, and accrued interest
on, all the Securities which are to be redeemed on that date other than any
Securities called for redemption on that date which have been converted prior to
the date of such deposit.
If any Security (or portion thereof) called for redemption is converted,
any money deposited with the Trustee or with a Paying Agent or so segregated and
held in trust for the redemption of such Security shall (subject to any right of
the Holder of such Security, if a Security, or any Predecessor Security, to
receive interest as provided in the last paragraph of Section 3.07) be paid to
the Company on Issuer Request as soon as administratively practicable after the
Trustee receives such Issuer Request or, if then held by the Company, shall be
discharged from such trust.
SECTION 11.07. Securities Payable on Redemption Date. If notice of
redemption has been given as above provided, the Securities or portions of
Securities with respect to which such notice has been given shall, unless
theretofore converted into Common Stock pursuant to the terms hereof, become due
and payable on the date and at the place or places stated in such notices at the
applicable Redemption Price, together with interest accrued to, but excluding,
the Redemption Date, and on and after said date (unless the Company shall
default in the payment of such Securities at the Redemption Price, together with
interest accrued to, but excluding, said date). Interest on the Securities or
portions of Securities so called for redemption shall cease to accrue and such
Securities shall cease after the Redemption Date to be convertible into Common
Stock and, except as provided in Sections 6.06 and 10.03, to be entitled to any
benefit or security under this Indenture, and the Holders thereof shall have no
right in respect of such Securities except the right to receive the Redemption
Price thereof and unpaid interest to, but excluding, the Redemption Date. Upon
surrender of any Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price together with
accrued and unpaid interest to, but excluding, the Redemption Date; provided,
however, that installments of interest shall be payable to the Holders of such
Securities, or one or more Predecessor Securities, registered as such on the
relevant Record Date according to their terms and the provisions of Section
3.07.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal, Redemption Price and, to the extent
permitted by applicable law, interest, if any, in respect thereof shall, until
paid, bear interest from the Redemption Date at the rate borne by the Security
and such Security shall remain convertible into Common Stock until the
Redemption Price shall have been paid or duly provided for.
SECTION 11.08. Securities Redeemed in Part. Any Security which is to be
redeemed only in part shall be surrendered at an office or agency of the Company
designated for that purpose pursuant to Section 10.02 (with, if the Company or
the Trustee so requires, due endorsement by, or a written instrument of transfer
in form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and make available for delivery to
the Holder of such Security without service charge, a new Security or
Securities, of any authorized
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denomination as requested by such Holder, in aggregate principal amount equal to
and in exchange for the unredeemed portion of the principal of the Security so
surrendered.
SECTION 11.09. Conversion Arrangement on Call for Redemption. In
connection with any redemption of Securities, the Company may arrange for the
purchase and conversion of any Securities by an agreement with one or more
investment bankers or other purchasers (the "Purchasers") to purchase such
securities by paying to the Trustee in trust for the Holders, on or before the
Redemption Date, an amount not less than the applicable Redemption Price,
together with interest accrued to, but excluding, the Redemption Date, of such
Securities. Notwithstanding anything to the contrary contained in this Article,
the obligation of the Company to pay the Redemption Price, together with
interest accrued to, but excluding, the Redemption Date, shall be deemed to be
satisfied and discharged to the extent such amount is so paid by such
Purchasers. If such an agreement is entered into (a copy of which shall be filed
with the Trustee 3 days prior to the Redemption Date), any Securities called for
redemption that are 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, and consistent with any agreement or agreements with such Purchasers, to be
acquired by such Purchasers from such Holders and (notwithstanding anything to
the contrary contained in Article 12) surrendered by such Purchasers for
conversion, all as of immediately prior to the close of business on the
Redemption Date (and the right to convert any such Securities shall be extended
though such time), subject to payment of the above amount as aforesaid. At the
direction of the Company, the Trustee shall hold and dispose of any such amount
paid to it to the Holders in the same manner as it would monies deposited with
it by the Company for the redemption of Securities. Without the Trustee's prior
written consent, no arrangement between the Company and such Purchasers for the
purchase and conversion of any Securities shall increase or otherwise affect any
of the powers, duties, responsibilities or obligations of the Trustee as set
forth in this Indenture, and 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, including reasonable legal fees, incurred by the Trustee in the
defense of any claim or liability arising out of or in connection with the
exercise or performance of any of its powers, duties, responsibilities or
obligations under this Indenture.
SECTION 11.10. No Sinking Fund. The Securities shall not be entitled to
the benefit of any sinking fund.
ARTICLE 12
CONVERSION OF SECURITIES
SECTION 12.01. Conversion Privilege and Conversion Price. Subject to and
upon compliance with the provisions of this Article, at the option of the Holder
thereof, the Holder of any Security is entitled at his option, at any time prior
to the close of business on __________, 2007, to convert the principal amount of
any such Security, or any portion of such principal amount which is $1,000 or a
multiple thereof, into that number of fully paid and nonassessable shares of
Common Stock obtained by dividing the principal amount of the Security or
portion thereof surrendered for conversion by the Conversion Price in effect at
such time, by surrender of the Security so to be converted in whole or in part
in the manner provided in Section 12.02.
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Such conversion right shall be subject, in the case of the conversion of any
Global Security, to any applicable book-entry procedures of the Depositary
therefor and the following sentence. In case a Security or portion thereof is
called for redemption or is delivered for repurchase, such conversion right in
respect of the Security or portion so called shall expire at the close of
business on the Business Day prior to the Redemption Date or the Fundamental
Change Redemption Date (as defined in Article 14), as the case may be, unless
the Company defaults in making the payment due upon redemption or repurchase, as
the case may be.
The Conversion Price shall be as specified in the forms of Security set
forth in Section 2.02, subject to adjustment as provided in this Article 12.
SECTION 12.02. Exercise of Conversion Privilege. Beneficial owners of
interests in a Global Security may exercise their right of conversion by
delivering to the Depositary the appropriate instruction form for conversion
pursuant to the Depositary's conversion program. To convert a definitive
Security into shares of Common Stock, a Holder must (a) complete and manually
sign the conversion notice in the form set forth in Section 2.03 on the back of
the definitive Security (or complete and manually sign a facsimile thereof) and
deliver such notice to the Trustee at the Corporate Trust Office of the Trustee
or the office or agency of [State Street Bank and Trust Company of California,
N.A.], in New York, New York or the office of any Conversion Agent, (b)
surrender the definitive Security to the Trustee at the Corporate Trust Office
of the Trustee or the office or agency of the [State Street Bank and Trust
Company of California, N.A.], in New York, New York or the office of any
Conversion Agent, (c) if required, furnish appropriate endorsements and transfer
documents, (d) if required, pay all transfer or similar taxes, and (e) if
required, pay funds equal to interest payable on the next Interest Payment Date.
The date on which all of the foregoing requirements have been satisfied is the
date of surrender for conversion. The Trustee shall promptly deliver to the
Company and the Company's Common Stock transfer agent notification of such
notice of conversion at the address described in Section 1.05.
Each Security surrendered for conversion will be converted into Common
Stock in registered form. Any Security or portion thereof surrendered for
conversion during the period from, but excluding, a record date for any Interest
Payment Date to, but excluding, such Interest Payment Date shall (unless such
Security or portion thereof being converted shall have been called for
redemption on a Redemption Date which occurs during such period, or is to be
redeemed in connection with a Fundamental Change on a Fundamental Change
Redemption Date which occurs during such period) be accompanied by payment, in
New York Clearing House funds of an amount equal to the interest otherwise
payable on such Interest Payment Date on the principal amount being converted;
provided, however, that no such payment need be made if there shall exist at the
time of conversion a default in the payment of interest on the Securities.
Except as provided above in this Section, no adjustment shall be made for
dividends on any shares issued upon the conversion of such Security as provided
in this Article.
The Company's delivery to the Holder of the number of shares of Common
Stock (and cash in lieu of fractions thereof, as provided in this Indenture)
into which a Security is convertible will be deemed to satisfy the Company's
obligation to pay the principal amount of the Security. The Common Stock is
treated as issued first in payment of accrued interest, and then in payment of
principal.
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Securities shall be deemed to have been converted immediately prior to the
close of business on the day of surrender of such Securities for conversion, in
accordance with the foregoing provisions, and at such time the rights of the
Holders of such Securities as Holders shall cease, and the Person or Persons
entitled to receive the shares of Common Stock issuable upon conversion shall be
treated for all purposes as the record holder or holders of such Common Stock at
such time. As promptly as practicable on or after the conversion date, the
Company shall issue and deliver to the Trustee, for delivery to the Holder, a
certificate or certificates for the number of full shares of Common Stock
issuable upon conversion, together with payment in lieu of any fraction of a
share, as provided in Section 12.03.
In the case of any Security which is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and
deliver to the Holder thereof, at the expense of the Company, a new Security or
Securities of authorized denominations in an aggregate principal amount equal to
the unconverted portion of the principal amount of such Security. A Security may
be converted in part, but only if the principal amount of such Security to be
converted is any integral multiple of U.S.$1,000 and the principal amount of
such security to remain Outstanding after such conversion is equal to U.S.$1,000
or any integral multiple thereof.
SECTION 12.03. Fractions of Shares. No fractional shares of Common Stock
shall be issued upon conversion of any Securities. If more than one Security
shall be surrendered for conversion at one time by the same Holder, the number
of full shares which shall be issuable upon conversion thereof shall be computed
on the basis of the aggregate principal amount of the Securities (or specified
portions thereof) so surrendered. Instead of any fractional share of Common
Stock which would otherwise be issuable upon conversion of any Securities (or
specified portions thereof), the Company shall make an adjustment and payment in
respect of such fraction in cash at the current market value thereof, to be
completed at the close of business on the day of conversion.
SECTION 12.04. Adjustment of Conversion Price. The Conversion Price shall
be subject to adjustments from time to time as follows:
(a) In case the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of Common
Stock, the Conversion Price in effect at the opening of business on the date
following the date fixed for the determination of stockholders entitled to
receive such dividend or other distribution shall be reduced by multiplying such
Conversion Price by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding at the close of business on the date fixed
for such determination and the denominator of which shall be the sum of such
number of shares and the total number of shares constituting such dividend or
other distribution, such reduction to become effective immediately after the
opening of business on the day following the date fixed for such determination.
If any dividend or distribution of the type described in this Section 12.04(a)
is declared but not so paid or made, the Conversion Price shall again be
adjusted to the Conversion Price which would then be in effect if such dividend
or distribution had not been declared.
(b) In case the Company shall issue rights or warrants to all holders of
its outstanding Common Stock entitling them (for a period expiring within 45
days after the date fixed for
64
determination of stockholders entitled to receive such rights or warrants) to
subscribe for or purchase Common Stock at a price per share less than the
Current Market Price (as defined in Section 12.04(h)(ii)) on the date fixed for
determination of stockholders entitled to receive such rights or warrants, the
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the date fixed for determination of stockholders entitled to receive such rights
or warrants by a fraction, the numerator of which shall be the number of shares
of Common Stock outstanding at the close of business on the date fixed for
determination of stockholders entitled to receive such rights and warrants plus
the number of shares which the aggregate offering price of the total number of
shares so offered would purchase at such Current Market Price, and the
denominator of which shall be the number of shares of Common Stock outstanding
on the date fixed for determination of stockholders entitled to receive such
rights or warrants plus the total number of additional shares of Common Stock
offered for subscription or purchase. Such adjustment shall be successively made
whenever any such rights or warrants are issued, and shall become effective
immediately after the opening of business on the day following the date fixed
for determination of stockholders entitled to receive such rights or warrants.
To the extent that shares of Common Stock are not delivered after the expiration
of such rights or warrants, the Conversion Price shall be readjusted to the
Conversion Price which would then be in effect had the adjustments made upon the
issuance of such rights or warrants been made on the basis of delivery of only
the number of shares of Common Stock actually delivered. In the event that such
rights or warrants are not so issued, the Conversion Price shall again be
adjusted to be the Conversion Price which would then be in effect if such date
fixed for the determination of stockholders entitled to receive such rights or
warrants had not been fixed. In determining whether any rights or warrants
entitle the holders to subscribe for or purchase Common Stock at less than such
Current Market Price, and in determining the aggregate offering price of such
Common Stock, there shall be taken into account any consideration received by
the Company for such rights or warrants, the value of such consideration, if
other than cash, to be determined by the Board of Directors.
(c) In case outstanding shares of Common Stock shall be subdivided into a
greater number of shares of Common Stock, the Conversion Price in effect at the
opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately reduced, and conversely, in case
outstanding shares of Common Stock shall be combined into a smaller number of
shares of Common Stock, the Conversion Price in effect at the opening of
business on the day following the day upon which such combination becomes
effective shall be proportionately increased.
(d) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock shares of any class of capital stock of the Company
(other than any dividends or distributions to which Section 12.04(a) applies) or
evidences of its indebtedness or assets (including securities, but excluding any
rights or warrants referred to in Section 12.04(b), and excluding any dividend
or distribution (x) paid exclusively in cash or (y) referred to in Section
12.04(a) (any of the foregoing hereinafter in this Section 12.04(d) called the
"Distribution Securities")), then, in each such case, the Conversion Price shall
be reduced so that the same shall be equal to the price determined by
multiplying the Conversion Price in effect on the Distribution Record Date with
respect to such distribution by a fraction the numerator of which shall be the
Current Market Price per share of Common Stock on such Distribution Record Date
less the fair market value (as determined by the Board of Directors whose
determination shall be
65
conclusive, and described in a resolution of the Board of Directors) on the
Distribution Record Date of the portion of the Distribution Securities so
distributed applicable to one share of Common Stock and the denominator of which
shall be the Current Market Price per share of Common Stock, such reduction to
become effective immediately prior to the opening of business on the day
following such Distribution Record Date; provided, however, that in the event
the then fair market value (as so determined) of the portion of the Distribution
Securities so distributed applicable to one share of Common Stock is equal to or
greater than the Current Market Price per share of the Common Stock on the
Distribution Record Date, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Holder shall have the right to receive upon
conversion the amount of Distribution Securities such Holder would have received
had such Holder converted each Security on the Distribution Record Date. In the
event that such dividend or distribution is not so paid or made, the Conversion
Price shall again be adjusted to be the Conversion Price which would then be in
effect if such dividend or distribution had not been declared. If the Company's
Board of Directors determines the fair market value of any distribution for
purposes of this Section 12.04(d) by reference to the actual or when issued
trading market for any securities, it must in doing so consider the prices in
such market over the same period used in computing the Current Market Price of
the Common Stock.
Rights or warrants distributed by the Company to all holders of Common
Stock entitling the holders thereof to subscribe for or purchase shares of the
Company's capital stock (either initially or under certain circumstances), which
rights or warrants, until the occurrence of a specified event or events
("Trigger Event"): (i) are deemed to be transferred with such shares of Common
Stock; (ii) are not exercisable; and (iii) are also issued in respect of future
issuances of shares of Common Stock, shall be deemed not to have been
distributed for purposes of this Section 12.04 (and no adjustment to the
Conversion Rate under this Section 12.04 will be required) until the occurrence
of the earliest Trigger Event, whereupon such rights and warrants shall be
deemed to have been distributed and an appropriate adjustment (if any is
required) to the Conversion Price shall be made under this Section 12.04(d). If
any such right or warrant, including any such existing rights or warrants
distributed prior to the date of this Indenture, are subject to events, upon the
occurrence of which such rights or warrants become exercisable to purchase
different securities, evidences of indebtedness or other assets or different
amounts of any of the foregoing, or both, then the date of the occurrence of any
and each such event shall be deemed to be the date of distribution and record
date with respect to new rights or warrants with such rights (and a termination
or expiration of the existing rights or warrants without exercise by any of the
holders thereof). In addition, in the event of any distribution (or deemed
distribution) of rights or warrants, or any Trigger Event or other event (of the
type described in the preceding sentence) with respect thereto that was counted
for purposes of calculating a distribution amount for which an adjustment to the
Conversion Price under this Section 12.04 was made, (1) in the case of any such
rights or warrants which shall all have been redeemed or repurchased without
exercise by any holders thereof, the Conversion Price shall be readjusted upon
such final redemption or repurchase to give effect to such distribution or
Trigger Event, as the case may be, as though it were a cash distribution, equal
to the per share redemption or repurchase price received by a holder or holders
of shares of Common Stock with respect to such rights or warrants (assuming such
holder had retained such rights or warrants), made to all holders of shares of
Common Stock as of the date of such redemption or repurchase, and (2) in the
case of such rights or warrants which shall have expired or been terminated
without exercise by any
66
holders thereof, the Conversion Price shall be readjusted as if such rights and
warrants had not been issued.
Notwithstanding the foregoing, in the event that the Company shall
distribute rights or warrants to subscribe for additional shares of the Common
Stock (other than rights or warrants described in Section 12.04(b)), pro rata to
substantially all holders of Common Stock, the Company may, in lieu of making
any adjustment pursuant to this Section 12.04(d), make proper provision so that
each holder of a Security who converts such Security (or any portion thereof)
after the Distribution Record Date for such distribution shall be entitled to
receive upon such conversion, in addition to the shares of Common Stock issuable
upon such conversion (the "Conversion Shares"), a number of rights or warrants
to be determined as follows: (i) if such conversion occurs on or prior to the
date for the distribution to the holders of such rights or warrants of separate
certificates evidencing such rights or warrants (the "Distribution Date"), the
same number of rights or warrants to which a holder of a number of shares of
Common Stock equal to the number of Conversion Shares is entitled at the time of
such conversion in accordance with the terms and provisions of and applicable to
such rights or warrants; and (ii) if such conversion occurs after the
Distribution Date, the same number of rights or warrants to which a holder of
the number of shares of Common Stock into which the principal amount of the
Security so converted was convertible immediately prior to the Distribution Date
would have been entitled on the Distribution Date in accordance with the terms
and provisions of, and applicable to such rights or warrants.
For purposes of this Section 12.04(d) and Sections 12.04(a) and (b), any
dividend or distribution to which this Section 12.04(d) is applicable that also
includes shares of Common Stock, or rights or warrants to subscribe for or
purchase shares of Common Stock (or both), shall be deemed instead to be (1) a
dividend or distribution of the evidences of indebtedness, assets or shares of
capital stock other than such shares of Common Stock or rights or warrants (and
any Conversion Price reduction required by this Section 12.04(d) with respect to
such dividend or distribution shall then be made) immediately followed by (2) a
dividend or distribution of such shares of Common Stock or such rights or
warrants (and any further Conversion Price reduction required by Sections
12.04(a) and (b) with respect to such dividend or distribution shall then be
made), except (A) the Distribution Record Date of such dividend or distribution
shall be substituted as "the date fixed for the determination of shareholders
entitled to receive such dividend or other distribution" and "the date fixed for
such determination" within the meaning of Sections 12.04(a) and (b) and (B) any
shares of Common Stock included in such dividend or distribution shall not be
deemed "outstanding at the close of business on the date fixed for such
determination" within the meaning of Section 12.04(a).
In the event the Company implements a rights plan (a "Rights Plan"), each
share of Common Stock issued upon conversion of Securities pursuant to this
Article 12 shall be entitled to receive the appropriate number of rights, if
any, and the certificates representing the Common Stock issued upon such
conversion shall bear such legends, if any, in each case as provided by and
subject to their terms of the rights agreement related to the Rights Plan (the
"Rights Agreement") as in effect at the time of such conversion. If the rights
are separated from the Common Stock in accordance with the provisions of such
Rights Agreement such that the Holders of Securities would thereafter not be
entitled to receive any such rights in respect to the Common Stock issuable upon
conversion of such Securities, the Conversion Price will be
67
adjusted as provided in this Section 12.04(d) on the separation date; provided
that if such rights expire, terminate or are redeemed by the Company, the
Conversion Price shall again be adjusted to be the Conversion Price which would
then be in effect if such separation had not occurred. In lieu of any such
adjustment, the Company may amend the Rights Agreement to provide that upon
conversion of the Securities the Holders will receive, in addition to the Common
Stock issuable upon such conversion, the rights which would have attached to
such shares of Common Stock if the rights had not become separated from the
Common Stock pursuant to the provisions of the Rights Agreement.
(e) In case the Company shall, by dividend or otherwise, distribute to all
holders of its Common Stock cash (excluding (x) any quarterly cash dividend on
the Common Stock to the extent that the aggregate cash dividend per share of
Common Stock in any quarterly period does not exceed the greater of (A) the
amount per share of Common Stock of the next preceding quarterly cash dividend
on the Common Stock to the extent that such preceding quarterly dividend did not
require any adjustment of the Conversion Price pursuant to this Section 12.04(e)
(as adjusted to reflect subdivisions or combinations of the Common Stock), and
(B) 3.75% of the arithmetic average of the Closing Prices (determined as set
forth in Section 12.04(h)) during the ten Trading Days immediately prior to the
date of declaration of such dividend, (y) any dividend or distribution in
connection with the liquidation, dissolution or winding up of the Company,
whether voluntary or involuntary and (z) any cash that is distributed as part of
a distribution requiring a Conversion Price adjustment pursuant to Section
12.04(d)), then, in such case, the Conversion Price shall be reduced so that the
same shall equal the price determined by multiplying the Conversion Price in
effect immediately prior to the close of business on such Distribution Record
Date by a fraction of which the numerator shall be the Current Market Price of
the Common Stock on the Distribution Record Date less the amount of cash so
distributed (and not excluded as provided above) applicable to one share of
Common Stock and the denominator shall be such Current Market Price of the
Common Stock, such increase to be effective immediately prior to the opening of
business on the day following the Distribution Record Date; provided, however,
that in the event the portion of the cash so distributed applicable to one share
of Common Stock is equal to or greater than the Current Market Price of the
Common Stock on the Distribution Record Date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each Holder shall have the
right to receive upon conversion the amount of cash such Holder would have
received had such Holder converted each Security on the Distribution Record
Date. In the event that such dividend or distribution is not so paid or made,
the Conversion Price shall again be adjusted to be the Conversion Price which
would then be in effect if such dividend or distribution had not been declared.
If any adjustment is required to be made as set forth in this Section 12.04(e)
as a result of a distribution that is a quarterly dividend, such adjustment
shall be based upon the amount by which such distribution exceeds the amount of
the quarterly cash dividend permitted to be excluded pursuant hereto. If an
adjustment is required to be made as set forth in this Section 12.04(e) above as
a result of a distribution that is not a quarterly dividend, such adjustment
shall be based upon the full amount of the distribution.
(f) In case a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders of consideration per share of
Common Stock having a fair market value (as determined by the
68
Board of Directors, whose determination shall be conclusive and described in a
Board Resolution) that as of the last time (the "Expiration Time") tenders or
exchanges may be made pursuant to such tender or exchange offer (as it may be
amended) exceeds the Current Market Price of the Common Stock on the Trading Day
next succeeding the Expiration Time, the Conversion Price shall be reduced so
that the same shall equal the price determined by multiplying the Conversion
Price in effect immediately prior to the Expiration Time by a fraction of which
the numerator shall be the number of Common Stock outstanding (including any
tendered or exchanged shares) on the Expiration Time multiplied by the Current
Market Price of the Common Stock on the Trading Day next succeeding the
Expiration Time and the denominator shall be the sum of (x) the fair market
value (determined as aforesaid) of the aggregate consideration payable to
stockholders based on the acceptance (up to any maximum specified in the terms
of the tender or exchange offer) of all shares validly tendered or exchanged and
not withdrawn as of the Expiration Time (the shares deemed so accepted, up to
any such maximum, being referred to as the "Purchased Shares") and (y) the
product of the number of Common Stock outstanding (less any Purchased Shares) on
the Expiration Time and the Current Market Price of the Common Stock on the
Trading Day next succeeding the Expiration Time, such reduction to become
effective immediately prior to the opening of business on the day following the
Expiration Time. In the event that the Company is obligated to purchase shares
pursuant to any such tender or exchange offer, but the Company is permanently
prevented by applicable law from effecting any such purchases or all such
purchases are rescinded, the Conversion Price shall again be adjusted to be the
Conversion Price which would then be in effect if such tender or exchange offer
had not been made.
(g) In case of a tender or exchange offer made by a Person other than the
Company or any Subsidiary of the Company for an amount which increases the
offeror's ownership of Common Stock to more than 25% of the Common Stock
outstanding and shall involve the payment by such Person of consideration per
share of Common Stock having a fair market value (as determined by the Board of
Directors, whose determination shall be conclusive, and described in a
resolution of the Board) at the last time (the "Tender Expiration Time") tenders
or exchanges may be made pursuant to such tender or exchange offer (as it shall
have been amended) that exceeds the Current Market Price per share of the Common
Stock on the Trading Day next succeeding the Tender Expiration Time, and in
which, as of the Tender Expiration Time the Board of Directors is not
recommending rejection of the offer, the Conversion Price shall be reduced so
that the same shall equal the price determined by multiplying the Conversion
Price in effect immediately prior to the Tender Expiration Time by a fraction of
which the numerator shall be the number of shares of Common Stock outstanding
(including any tendered or exchanged shares) on the Tender Expiration Time
multiplied by the Current Market Price of the Common Stock on the Trading Day
next succeeding the Tender Expiration Time and the denominator shall be the sum
of (x) the fair market value (determined as aforesaid) of the aggregate
consideration payable to stockholders based on the acceptance (up to any maximum
specified in the terms of the tender or exchange offer) of all shares validly
tendered or exchanged and not withdrawn as of the Tender Expiration Time (the
shares deemed so accepted, up to any such maximum, being referred to as the
"Accepted Purchased Shares") and (y) the product of the number of shares of
Common Stock outstanding (less any Accepted Purchased Shares) on the Tender
Expiration Time and the Current Market Price of the Common Stock on the Trading
Day next succeeding the Tender Expiration Time, such reduction to become
effective immediately prior to the opening of business on the day following the
Tender Expiration Time. In the event
69
that such Person is obligated to purchase shares pursuant to any such tender or
exchange offer, but such Person is permanently prevented by applicable law from
effecting any such purchases or all such purchases are rescinded, the Conversion
Price shall again be adjusted to be the Conversion Price which would then be in
effect if such tender or exchange offer had not been made. Notwithstanding the
foregoing, the adjustment described in this Section 12.04(g) shall not be made
if, as of the Tender Expiration Time, the offering documents with respect to
such offer disclose a plan or intention to cause the Company to engage in any
transaction described in Article 7.
(h) For purposes of this Section 12.04, the following terms shall have the
meaning indicated:
(i) "Closing Price" with respect to any securities on any day shall
mean the closing sale price, regular way, on such day or, in case no such
sale takes place on such day, the average of the reported closing bid and
asked prices, regular way, in each case on the New York Stock Exchange, or,
if such security is not listed or admitted to trading on such Exchange, on
the principal security exchange or quotation system in the United States on
which such security is quoted or listed or admitted to trading, or, the
average of the closing bid and asked prices of such security on the over-
the-counter market on the day in question as reported by the Nasdaq
National Market or a similar generally accepted reporting service, or if
not so available, in such manner as furnished by any New York Stock
Exchange member firm selected from time to time by the Board of Directors
for that purpose, or a price determined in good faith by the Board of
Directors or, to the extent permitted by applicable law, a duly authorized
committee thereof, whose determination shall be conclusive.
(ii) "Current Market Price" shall mean the average of the daily
Closing Prices per share of Common Stock for the ten consecutive Trading
Days immediately prior to the date in question; provided, however, that (A)
if the "ex" date (as hereinafter defined) for any event (other than the
issuance or distribution or Fundamental Change requiring such computation)
that requires an adjustment to the Conversion Rate pursuant to Section
12.04(a), (b), (c), (d), (e), (f) or (g) occurs during such ten consecutive
Trading Days, the Closing Price for each Trading Day prior to the "ex" date
for such other event shall be adjusted by multiplying such Closing Price by
the same fraction by which the Conversion Price is so required to be
adjusted as a result of such other event, (B) if the "ex" date for any
event (other than the issuance, distribution or Fundamental Change
requiring such computation) that requires an adjustment to the Conversion
Price pursuant to Section 12.04(a), (b), (c), (d), (e), (f) or (g) occurs
on or after the "ex" date for the issuance or distribution requiring such
computation and prior to the day in question, the Closing Price for each
Trading Day on and after the "ex" date for such other event shall be
adjusted by multiplying such Closing Price by the reciprocal of the
fraction by which the Conversion Price is so required to be adjusted as a
result of such other event, and (C) if the "ex" date for the issuance,
distribution or Fundamental Change requiring such computation is prior to
the day in question, after taking into account any adjustment required
pursuant to clause (A) or (B) of this proviso, the Closing Price for each
Trading Day on or after such "ex" date shall be adjusted by adding thereto
the amount of any cash and the fair market value (as determined by the
Board of Directors in a manner consistent
70
with any determination of such value for purposes of Section 12.04(d), (f)
or (g) whose determination shall be conclusive and described in a
resolution of the Board of Directors) of the evidences of indebtedness,
shares of capital stock or assets being distributed applicable to one share
of Common Stock as of the close of business on the day before such "ex"
date. For purposes of any computation under Section 12.04(f) or (g), the
Current Market Price of the Common Stock on any date shall be deemed to be
the average of the daily Closing Prices per share of Common Stock for such
day and the next two succeeding Trading Days; provided, however, that if
the "ex" date for any event (other than the tender or exchange offer
requiring such computation) that requires an adjustment to the Conversion
Price pursuant to Section 12.04(a), (b), (c), (d), (e), (f) or (g) occurs
on or after the Expiration Time or Tender Expiration Time, as the case may
be, for the tender or exchange offer requiring such computation and prior
to the day in question, the Closing Price for each Trading Day on and after
the "ex" date for such other event shall be adjusted by multiplying such
Closing Price by the same fraction by which the Conversion Price is so
required to be adjusted as a result of such other event. For purposes of
this paragraph, the term "ex" date, (1) when used with respect to any
issuance or distribution, means the first date on which the Common Stock
trades regular way on the relevant exchange or in the relevant market from
which the Closing Price was obtained without the right to receive such
issuance or distribution, (2) when used with respect to any subdivision or
combination of shares of Common Stock, means the first date on which the
Common Stock trades regular way on such exchange or in such market after
the time at which such subdivision or combination becomes effective, and
(3) when used with respect to any tender or exchange offer means the first
date on which the Common Stock trades regular way on such exchange or in
such market after the Expiration Time or Tender Expiration Time, as the
case may be, of such offer.
(iii) "Fair Market Value" shall mean the amount which a willing buyer
would pay a willing seller in an arm's length transaction.
(iv) "Distribution Record Date" shall mean, with respect to any
dividend, distribution or other transaction or event in which the holders
of Common Stock have the right to receive any cash, securities or other
property or in which the Common Stock (or other applicable security) is
exchanged for or converted into any combination of cash, securities or
other property, the date fixed for determination of stockholders entitled
to receive such cash, securities or other property (whether such date is
fixed by the Board of Directors or by statute, contract or otherwise).
(v) "Trading Day" shall mean (x) if the applicable security is listed
or admitted for trading on the New York Stock Exchange or another national
security exchange, a day on which the New York Stock Exchange or another
national security exchange is open for business or (y) if the applicable
security is quoted on the Nasdaq National Market, a day on which trades may
be made on thereon or (z) if the applicable security is not so listed,
admitted for trading or quoted, any day other than a Saturday or Sunday or
a day on which banking institutions in the State of New York are authorized
or obligated by law or executive order to close.
71
(i) No adjustment in the Conversion Rate shall be required unless such
adjustment (plus any adjustments not previously made by reason of this paragraph
(i)) would require an increase or decrease of at least one percent in such rate;
provided, however, that any adjustments which by reason of this paragraph (i)
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Article shall be made to
the nearest cent or to the nearest one-hundredth of a share, as the case may be.
(j) The Company may, at its option, make such reductions in the Conversion
Price as the Board deems advisable, in addition to those required by paragraphs
(a), (b), (c), (d), (e), (f) or (g) of this Section 12.04 in order to avoid or
diminish any income tax to any holders of Common Stock or rights to purchase
Common Stock resulting from any dividend or distribution on Common Stock (or
rights to acquire such shares) or from any event treated as such for income tax
purposes, resulting from any dividend or distribution of shares or issuance of
rights or warrants to purchase or subscribe for shares or from any event treated
as such for income tax purposes.
To the extent permitted by applicable law, the Company from time to time
may reduce the Conversion Price by any amount for any period of time if the
period is (i) at least twenty (20) days, (ii) the reduction is irrevocable
during the period and (iii) the Board shall have made a determination that such
reduction would be in the best interests of the Company, which determination
shall be conclusive. Whenever the Conversion Price is reduced pursuant to the
preceding sentence, the Company shall give notice of the increase to the Holders
of Securities in the manner provided in Section 1.06 at least fifteen (15) days
prior to the date the reduced Conversion Price takes effect, and such notice
shall state the reduced Conversion Price and the period during which it will be
in effect.
(k) No adjustment of the Conversion Price will result in zero or a negative
number.
SECTION 12.05. Notice of Adjustments of Conversion Price. Whenever the
Conversion Price is adjusted as herein provided:
(a) the Company shall compute the adjusted Conversion Price in
accordance with Section 12.04 and shall prepare a certificate signed by the
President, Treasurer, Chief Financial Officer or Vice President of Finance
of the Company setting forth the adjusted Conversion Price and showing in
reasonable detail the facts upon which such adjustment is based, and such
certificate shall promptly be filed with the Trustee and with each
Conversion Agent; and
(b) a notice stating that the Conversion Price has been adjusted and
setting forth the adjusted Conversion Price shall promptly be prepared and
as soon as practicable thereafter, such notice shall be provided by the
Company to all Holders in accordance with Section 1.06.
Neither the Trustee nor any Conversion Agent shall be under any duty or
responsibility with respect to any such certificate or the information and
calculations contained therein, except to exhibit the same to any Holder of
Securities desiring inspection thereof at its office during
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normal business hours. Unless and until the Trustee shall receive such
certificate, it may assume without inquiry that the Conversion Price has not
been adjusted.
SECTION 12.06. Notice of Certain Corporate Action. In case:
(a) the Company shall declare a dividend (or any other distribution)
on all or substantially all of its Common Stock payable (i) otherwise than
exclusively in cash or (ii) exclusively in cash in an amount that would
require any adjustment pursuant to Section 12.04; or
(b) the Company shall authorize the granting to the holders of its
Common Stock of rights, options or warrants to subscribe for or purchase
any shares of capital stock of any class or of any other rights that would
require any adjustment pursuant to Section 12.04; or
(c) of any reclassification of the Common Stock of the Company (other
than a subdivision or combination of its outstanding Common Stock), or of
any consolidation or merger to which the Company is a party and for which
approval of any stockholders of the Company is required, or of the sale or
transfer of all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company or any significant subsidiary; or
(e) the Company or any Subsidiary of the Company shall commence a
tender offer for all or a portion of the Company's outstanding Common Stock
(or shall amend any such tender offer);
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Securities pursuant to Section 10.02, and shall
cause to be provided to all Holders in accordance with Section 1.06, at least 20
days (or 10 days in any case specified in clause (a) or (b) above) prior to the
applicable record, expiration or effective date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such
dividend, distribution, rights, options or warrants, or, if a record is not to
be taken, the date as of which the holders of Common Stock of record to be
entitled to such dividend, distribution, rights, options or warrants are to be
determined, (y) the date on which the right to make tenders under such tender
offer expires or (z) the date on which such reclassification, consolidation,
merger, share exchange, conveyance, transfer, sale, dissolution, liquidation or
winding up is expected to become effective, and the date as of which it is
expected that holders of shares of Common Stock of record shall be entitled to
exchange their shares of Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, share exchange,
conveyance, transfer, sale, lease, dissolution, liquidation or winding up. If at
the time the Trustee shall not be the Conversion Agent, a copy of such notice
and any notice referred to in the following paragraph shall also forthwith be
filed by the Company with the Trustee.
The preceding paragraph to the contrary notwithstanding, the Company shall
cause to be filed at each office or agency maintained for the purpose of
conversion of Securities pursuant to Section 10.02, and shall cause to be
provided to all Holders in accordance with Section 1.06,
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notice of any tender offer by the Company or any subsidiary of the Company for
all or any portion of the Common Stock at or about the time that such notice of
tender offer is provided to the public generally (such notice to be sent to all
Holders within five days after receipt of such notice by the Trustee or
Conversion Agent from the Company).
SECTION 12.07. Company to Provide Common Stock. The Company shall ensure
that the Company has, free from preemptive rights, out of its authorized but
unissued Common Stock, the full number of shares of Common Stock for the purpose
of effecting the conversion of Securities.
SECTION 12.08. Taxes on Conversions. The Company will pay any and all
taxes and duties that may be payable in respect of the issue or delivery of
Common Stock on conversion of Securities pursuant hereto. The Company shall not,
however, be required to pay any tax or duty which may be payable in respect of
any transfer involved in the issue and delivery of Common Stock in a name other
than that of the Holder of the Security or Securities to be converted, and no
such issue or delivery shall be made unless and until the Person requesting such
issue has paid to the Company the amount of any such tax or duty, or has
established to the satisfaction of the Company that such tax or duty has been
paid.
SECTION 12.09. Company Covenant as to Common Stock. The Company covenants
that all Common Stock which may be delivered upon conversion of Securities, upon
such delivery, will have been duly authorized and validly issued and will be
fully paid and nonassessable and, except as provided in Section 12.08, the
Company will pay all taxes, liens and charges with respect to the issue thereof.
SECTION 12.10. Cancellation of Converted Securities. All Securities
delivered for conversion shall be delivered to the Trustee or its agent to be
canceled by or at the direction of the Trustee, which shall dispose of the same
as provided in Section 3.09.
SECTION 12.11. Effect of Reclassification, Consolidation, Merger or Sale.
If any of the following events occur, namely (a) any reclassification or change
of the outstanding shares of Common Stock (other than a subdivision or
combination to which Section 12.04(c) applies), (b) any consolidation, merger or
combination of the Company with another corporation as a result of which holders
of Common Stock shall be entitled to receive stock, securities or other property
or assets (including cash) with respect to or in exchange for such Common Stock,
or (c) any sale or conveyance of the properties and assets of the Company as, or
substantially as, an entirety to any other corporation as a result of which
holders of Common Stock shall be entitled to receive stock, securities or other
property or assets (including cash) with respect to or in exchange for such
Common Stock, then the Company or the successor or purchasing corporation, as
the case may be, shall execute with the Trustee a supplemental indenture (which
shall comply with the Trust Indenture Act as in force at the date of execution
of such supplemental indenture) providing that such Security shall be
convertible into the kind and amount of shares of stock and other securities or
property or assets (including cash) receivable upon such reclassification,
change, consolidation, merger, combination, sale or conveyance by a holder of a
number of shares of Common Stock issuable upon conversion of such Securities
(assuming, for such purposes, a sufficient number of authorized shares of Common
Stock available to convert all such Securities) immediately prior to such
reclassification, change,
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consolidation, merger, combination, sale or conveyance assuming such holder of
Common Stock is (i) not a Person with which the Company consolidated or into
which the Company merged or which merged into the Company or to which such sale
or transfer was made, as the case may be (a "Constituent Person"), or an
Affiliate of a Constituent Person, and (ii) failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash or other property
receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance (provided that, if the kind or amount of
securities, cash or other property receivable upon such reclassification,
change, consolidation, merger, combination, sale or conveyance is not the same
for each share of Common Stock in respect of which such rights of election shall
not have been exercised ("Non-Electing Share")), then for the purposes of this
Section 12.11 the kind and amount of securities, cash or other property
receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance for each Non-electing Share shall be deemed to
be the kind and amount so receivable per share by a plurality of the non-
electing shares. Such supplemental indenture shall provide for adjustments
which, for events subsequent to the effective date of such supplemental
indenture, shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article. The above provisions of this Section
12.11 shall similarly apply to successive reclassifications, changes,
consolidations, mergers, combinations, sales or conveyances. Notice of the
execution of such a supplemental indenture shall be given by the Company to the
Holder of each Security as provided in Section 1.06 promptly upon such
execution.
Neither the Trustee, any Paying Agent nor any Conversion Agent shall be
under any responsibility to determine the correctness of any provisions
contained in any such supplemental indenture relating either to the kind or
amount of shares of stock or other securities or property or cash receivable by
Holders of Securities upon the conversion of their Securities after any such
reclassification, change, consolidation, merger, combination, sale or conveyance
or to any such adjustment, but may accept as conclusive evidence of the
correctness of any such provisions, and shall be protected in relying upon, an
Opinion of Counsel with respect thereto, which the Company shall cause to be
furnished to the Trustee.
SECTION 12.12. Responsibility of Trustee for Conversion Provisions. The
Trustee and any Conversion Agent shall not at any time be under any duty or
responsibility to any Holder of Securities to determine whether any facts exist
which may require any adjustment of the Conversion Price, or with respect to the
nature or extent of any such adjustment when made, or with respect to the method
employed, or herein or in any supplemental indenture provided to be employed, in
making the same, or whether a supplemental indenture need be entered into.
Neither the Trustee nor any Conversion Agent shall be accountable with respect
to the validity or value (or the kind or amount) of any Common Stock, or of any
other securities or property or cash, which may at any time be issued or
delivered upon the conversion of any Security; and it or they do not make any
representation with respect thereto. Neither the Trustee, subject to the
provisions of Section 6.01, nor any Conversion Agent shall be responsible for
any failure of the Company to make or calculate any cash payment or to issue,
transfer or deliver any Common Stock or share certificates or other securities
or property or cash upon the surrender of any Security for the purpose of
conversion; and the Trustee and any Conversion Agent shall not be responsible
for any failure of the Company to comply with any of the covenants of the
Company contained in this Article.
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ARTICLE 13
SUBORDINATION OF SECURITIES
SECTION 13.01. Agreement of Subordination. The Company covenants and
agrees, and each Holder of Securities issued hereunder by his acceptance thereof
likewise covenants and agrees, that all Securities shall be issued subject to
the provisions of this Article; and each Person holding any Security, whether
upon original issue or upon transfer, assignment or exchange thereof, accepts
and agrees to be bound by such provisions.
The payment of the principal, Redemption Price or Fundamental Change
Redemption Price, if any, and interest, if any, in respect of all Securities
(including, but not limited to, the Redemption Price with respect to the
Securities called for redemption in accordance with Article 11, or the
Fundamental Change Redemption Price with respect to Securities submitted for
repurchase in accordance with Article 14, as the case may be, as provided in
this Indenture) issued hereunder shall, to the extent and in the manner
hereinafter set forth, be subordinated and subject in right of payment to the
prior payment in full in cash of all Senior Indebtedness, whether outstanding at
the date of this Indenture or thereafter incurred.
No provision of this Article 13 shall prevent the occurrence of any default
or Event of Default hereunder.
SECTION 13.02. Payments to Holders. No payment shall be made with respect
to the principal, Redemption Price, Fundamental Change Redemption Price, or
interest, if any, in respect of, the Securities by or on behalf of the Company
(including, but not limited to, the Redemption Price with respect to the
Securities to be called for redemption in accordance with Article 11 or the
Fundamental Change Redemption Price with respect to Securities submitted for
repurchase in accordance with Article 14, as the case may be, as provided in
this Indenture), except payments and distributions made by the Trustee as
permitted by the first or second paragraph of Section 13.05, if:
(a) a default in the payment of principal, premium, interest, rent or
other obligations due on any Designated Senior Indebtedness, has occurred
and is continuing (or, in the case of Designated Senior Indebtedness, for
which there is a period of grace, in the event of such a default that
continues beyond the period of grace, if any, specified in the instrument
or lease evidencing such Designated Senior Indebtedness), unless and until
such default shall have been cured or waived or shall have ceased to exist;
or
(b) a default (other than a payment default) on Designated Senior
Indebtedness of the Company occurs and is continuing that then permits
holders of such Designated Senior Indebtedness to accelerate its maturity
and the Trustee receives a notice of the default (a "Payment Blockage
Notice") from the Company, or a Representative of Designated Senior
Indebtedness of Company or a holder of Designated Senior Indebtedness of
the Company.
If the Trustee receives any Payment Blockage Notice pursuant to clause
(b) above, no subsequent Payment Blockage Notice shall be effective for
purposes of this Section unless and until at least 365 days shall have
elapsed since the initial effectiveness
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of the immediately prior Payment Blockage Notice. No nonpayment default
that existed or was continuing on the date of delivery of any Payment
Blockage Notice to the Trustee (unless such default was waived, cured or
otherwise ceased to exist and thereafter subsequently reoccurred) shall be,
or be made, the basis for a subsequent Payment Blockage Notice.
The Company may and shall resume payments on and distributions in
respect of the Securities upon the earlier of:
(i) in the case of a payment default, the date upon which the
default is cured or waived or ceases to exist, or
(ii) in the case of a default referred to in clause (b) above,
the earlier of the date on which such default is cured or waived or
ceases to exist or 179 days after the date on which the applicable
Payment Blockage Notice is received by the Trustee if the maturity of
the applicable Designated Senior Indebtedness has not been accelerated
and no Payment Default with respect to any such Designated Senior
Indebtedness has occurred which has not been cured or waived (in which
case clause (i) shall instead be applicable),
unless this Article otherwise prohibits the payment or distribution at the time
of such payment or distribution (including without limitation, in the case of
default referred to in clause (b) above, as a result of a payment default with
respect to the applicable Designated Senior Indebtedness as a consequence of the
acceleration of the maturity thereof or otherwise).
Upon any payment by the Company, or distribution of assets of the Company
of any kind or character, whether in cash, property or securities, to creditors
upon any dissolution or winding-up or liquidation or reorganization of the
Company, whether voluntary or involuntary or in bankruptcy, moratorium of
payments, insolvency, receivership or other proceedings, all amounts due or to
become due upon all Senior Indebtedness, shall first be paid in full in cash or
other payment satisfactory to the holders of such Senior Indebtedness, or
payment thereof in accordance with its terms provided for in cash or other
payment satisfactory to the holders of such Senior Indebtedness before any
payment is made on account of the principal, Redemption Price, Fundamental
Change Redemption Price, or interest, if any, in respect of the Securities
(except payments by the Company made pursuant to Article 4 from monies deposited
with the Trustee pursuant thereto prior to commencement of proceedings for such
dissolution, winding-up, liquidation or reorganization); and upon any such
dissolution or winding-up or liquidation or reorganization of the Company or
bankruptcy, insolvency, receivership or other proceeding, any payment by the
Company, or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the Holders or the Trustee
would be entitled, except for the provision of this Article, shall (except as
aforesaid) be paid by the Company or by any receiver, trustee in bankruptcy,
moratorium of payments, liquidating trustee, agent or other Person making such
payment or distribution, or by the Holders or by the Trustee under this
Indenture if received by them or it, directly to the holders of Senior
Indebtedness (pro rata to such holders on the basis of the respective amounts of
such Senior Indebtedness held by such holders, or as otherwise required by law
or a court order) or their Representative or Representatives, or to the trustee
or trustees under any indenture pursuant to which any
77
instruments evidencing any such Senior Indebtedness may have been issued, as
their respective interests may appear, to the extent necessary to pay all such
Senior Indebtedness in full, in cash or other payment satisfactory to the
holders of such Senior Indebtedness, after giving effect to any concurrent
payment or distribution to or for the holders of such Senior Indebtedness,
before any payment or distribution is made to the Holders or to the Trustee.
For purposes of this Article, the words, "cash, property or securities"
shall not be deemed to include a payment or distribution of stock of the Company
as reorganized or readjusted, or securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated at least to the extent provided in this Article
with respect to the Securities to the payment of all Senior Indebtedness, which
may at the time be outstanding; provided that (i) such Senior Indebtedness is
assumed by the new corporation, if any, resulting from any reorganization or
readjustment, and (ii) the rights of the holders of such Senior Indebtedness
(other than leases which are not assumed by the Company or the new corporation,
as the case may be) are not, without the consent of such holders, altered by
such reorganization or readjustment. The merger of the Company into another
corporation or the liquidation or dissolution of the Company following the
conveyance or transfer of its property as an entirety, or substantially as an
entirety, to another corporation upon the terms and conditions provided for in
Article 7 shall not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section 13.02 if such other corporation
shall, as a part of such merger, conveyance or transfer, comply with the
conditions stated in Article 7.
In the event of the acceleration of the Securities because of an Event of
Default, no payment or distribution shall be made to the Trustee or any Holder
of Securities in respect of the principal, Redemption Price, Fundamental Change
Redemption Price, or interest, if any, in respect of, the Securities by or on
behalf of the Company (including, but not limited to, the Redemption Price with
respect to the Securities called for redemption in accordance with Article 11 or
the Fundamental Change Redemption Price with respect to Securities submitted for
repurchase in accordance with Article 14, as the case may be, as provided in
this Indenture), except payments and distributions made by the Trustee as
permitted by the first or second paragraph of Section 13.05, until all Senior
Indebtedness, has been paid in full in cash or other payment satisfactory to the
holders of such Senior Indebtedness or such acceleration is rescinded in
accordance with the terms of this Indenture. If payment of the Securities is
accelerated because of an Event of Default, the Company shall promptly notify
holders of their Senior Indebtedness of the acceleration.
In the event that, notwithstanding the foregoing provisions, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities (including, without limitation, by way of setoff or
otherwise), prohibited by the foregoing, shall be received by the Trustee or the
Holders of the Securities before all of the Senior Indebtedness, is paid in full
in cash or other payment satisfactory to the holders of such Senior
Indebtedness, or provision is made for such payment thereof in accordance with
its terms in cash or other payment satisfactory to the holders of their Senior
Indebtedness, such payment or distribution shall be held in trust for the
benefit of and shall be paid over or delivered to the holders of Senior
Indebtedness or their Representative or Representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing any
such Senior Indebtedness may have been issued, as their respective interests may
appear, as calculated by the Company, for
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application to the payment of all such Senior Indebtedness remaining unpaid to
the extent necessary to pay all such Senior Indebtedness in full in cash or
other payment satisfactory to the holders of such Senior Indebtedness, after
giving effect to any concurrent payment or distribution, or provision therefor,
to or for the holders of such Senior Indebtedness.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 6.07. This Section 13.02 shall be subject
to the further provisions of Section 13.05.
SECTION 13.03. Subrogation of Securities. Subject to the payment in full
in cash of all Senior Indebtedness, the Holders of the Securities shall be
subrogated to the extent of the payments or distributions made to the holders of
such Senior Indebtedness pursuant to the provisions of this Article (equally and
ratably with the holders of all indebtedness of the Company which by its express
terms is subordinated to other indebtedness of the Company to substantially the
same extent as the Securities are subordinated and is entitled to like rights of
subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of cash, property or securities applicable to the
Senior Indebtedness until the principal, Redemption Price, Fundamental Change
Redemption Price, and interest, if any, in respect of the Securities shall be
paid in full; and, for the purposes of such subrogation, no payments or
distributions to the holders of the Senior Indebtedness of any cash, property or
securities to which the Holders of the Securities or the Trustee would be
entitled except for the provisions of this Article 13, and no payment over
pursuant to the provisions of this Article 13, to or for the benefit of the
holders of Senior Indebtedness, by Holders of the Securities or the Trustee,
shall, as between the Company, its creditors other than holders of such Senior
Indebtedness, and the Holders of the Securities, be deemed to be a payment by
the Company to or on account of the Senior Indebtedness. It is understood that
the provisions of this Article 13 are and are intended solely for the purposes
of defining the relative rights of the Holders of the Securities, on the one
hand, and the holders of the Senior Indebtedness, on the other hand.
Nothing contained in this Article 13 or elsewhere in this Indenture or in
the Securities is intended to or shall impair, as among the Company, its
creditors other than the holders of Senior Indebtedness, and the Holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Securities the principal, Redemption Price,
Fundamental Change Redemption Price and interest, if any, in respect of the
Securities as and when the same shall become due and payable in accordance with
their terms, or is intended to or shall affect the relative rights of the
Holders of the Securities and creditors of the Company other than the holders of
the Senior Indebtedness, nor shall anything herein or therein prevent the
Trustee or the Holder of any Security from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article 13 of the holders of Senior Indebtedness in
respect of cash, property or securities received upon the exercise of any such
remedy.
Upon any payment or distribution of assets of the Company referred to in
this Article 13, the Trustee, subject to the provisions of Section 6.01, and the
Holders of the Securities shall be entitled to rely upon any order or decree
made by any court of competent jurisdiction in which such bankruptcy,
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, trustee in bankruptcy, liquidating trustee,
agent or other Person
79
making such payment or distribution, delivered to the Trustee or to the Holders
of the Securities, for the purpose of ascertaining the Persons entitled to
participate in such distribution, the holders of the Senior Indebtedness of the
Company and other Indebtedness of the Company, the amount thereof or payable
thereon and all other facts pertinent thereto or to this Article 13.
SECTION 13.04. Authorization to Effect Subordination. Each Holder of a
Security by the Holder's acceptance thereof authorizes and directs the Trustee
on the Holder's behalf to take such action as may be necessary or appropriate to
effectuate the subordination as provided in this Article and appoints the
Trustee to act as the Holder's attorney-in-fact for any and all such purposes.
If the Trustee does not file a proper proof of claim or proof of debt in the
form required in any proceeding referred to in Section 5.04 hereof at least 30
days before the expiration of the time to file such claim, the holders of any
Senior Indebtedness or their Representatives are hereby authorized to file an
appropriate claim for and on behalf of the Holders of the Securities.
SECTION 13.05. Notice to Trustee. The Company shall give prompt written
notice in the form of an Officers' Certificate to a Responsible Officer of the
Trustee and to any Paying Agent of any fact known to the Company which would
prohibit the making of any payment of monies deposited by the Company to or by
the Trustee or any Paying Agent in respect of the Securities pursuant to the
provisions of this Article. Notwithstanding the provisions of this Article or
any other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts which would prohibit the making of any
payment of monies deposited by the Company to or by the Trustee in respect of
the Securities pursuant to the provisions of this Article, unless and until a
Responsible Officer of the Trustee shall have received written notice thereof at
the Corporate Trust Office from the Company (in the form of an Officers'
Certificate) or a Representative of Senior Indebtedness or of a holder or
holders of Senior Indebtedness or from any trustee thereof; and before the
receipt of any such written notice, the Trustee shall be entitled in all
respects to assume that no such facts exist; provided that if on a date not
fewer than two Business Days prior to the date upon which by the terms hereof
any such monies may become payable for any purpose (including, without
limitation, the payment of the principal, Redemption Price, Fundamental Change
Redemption Price, or interest, if any, in respect of any Security) the Trustee
shall not have received, with respect to such monies, the notice provided for in
this Section 13.05, then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive such
monies deposited by the Company and to apply the same to the purpose for which
they were received, and shall not be affected by any notice to the contrary
which may be received by it on or after such prior date.
Notwithstanding anything in this Article to the contrary, nothing shall
prevent any payment by the Trustee to the Holders of monies deposited with it
pursuant to Section 4.01, and any such payment shall not be subject to the
provisions of Section 13.01 or 13.02.
The Trustee shall be entitled to rely on the delivery to it of a written
notice by a Representative or a Person representing himself to be a holder of
Senior Indebtedness (or a trustee on behalf of such holder) to establish that
such notice has been given by a Representative or a holder of Senior
Indebtedness or a trustee on behalf of any such holder or holders. In the event
that the Trustee determines in good faith that further evidence is required with
respect to the right of any Person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to this Article, the Trustee
may request such Person to furnish evidence to the reasonable satisfaction of
the Trustee as to the amount of Senior Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such payment or
80
distribution and any other facts pertinent to the rights of such Person under
this Article 13, and if such evidence is not furnished the Trustee may defer any
payment to such Person pending judicial determination as to the right of such
Person to receive such payment.
SECTION 13.06. Trustee's Relation to Senior Indebtedness. The Trustee in
its individual capacity shall be entitled to all the rights set forth in this
Article in respect of any Senior Indebtedness at any time held by it, to the
same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness, the Trustee undertakes
to perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article, and no implied covenants or obligations
with respect to the holders of Senior Indebtedness shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Indebtedness and the Trustee shall not
be liable to any holder of Senior Indebtedness if it shall pay over or deliver
to Holders of Securities, the Company or any other Person money or assets to
which any holder of Senior Indebtedness shall be entitled by virtue of this
Article or otherwise.
SECTION 13.07. No Impairment of Subordination. No right of any present or
future holder of any Senior Indebtedness to enforce subordination as herein
provided shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or failure to act, in
good faith, by any such holder, or by any noncompliance by the Company with the
terms, provisions and covenants of this Indenture, regardless of any knowledge
thereof which any such holder may have or otherwise be charged with.
SECTION 13.08. Article Applicable to Paying Agents. If at any time any
Paying Agent other than the Trustee shall have been appointed by the Company and
be then acting hereunder, the term "Trustee" as used in this Article shall
(unless the context otherwise requires) be construed as extending to and
including such Paying Agent within its meaning as fully for all intents and
purposes as if such Paying Agent were named in this Article in addition to or in
place of the Trustee; provided, however, that the first paragraph of Section
13.05 shall not apply to either of the Company or any Affiliate of the Company
if the Company or such Affiliate acts as Paying Agent.
SECTION 13.09. Senior Indebtedness Entitled to Rely. The holders of
Senior Indebtedness (including, without limitation, Designated Senior
Indebtedness) shall have the right to rely upon this Article 13, and no
amendment or modification of the provisions contained herein shall diminish the
rights of such holders unless such holders shall have agreed in writing thereto.
SECTION 13.10. Certain Conversions Deemed Payment. For the purposes of
this Article 13 only, (1) the issuance and delivery of junior securities upon
conversion of Securities in accordance with Article 12 shall not be deemed to
constitute a payment or distribution on
81
account of the principal, Redemption Price, Fundamental Change Redemption
Price or interest, if any, in respect of Securities or on account of the
purchase or other acquisition of Securities, and (2) the payment, issuance or
delivery of cash (except in satisfaction of fractional shares pursuant to
Section 12.02), property or securities (other than junior securities) upon
conversion of a Security shall be deemed to constitute payment on account of the
principal of such Security. For the purposes of this Section 13.10, the term
"junior securities" means (a) shares of any stock of any class of the Company
(including, without limitation, the Common Stock), or (b) securities of the
Company which are subordinated in right of payment to all Senior Indebtedness,
which may be outstanding at the time of issuance or delivery of such securities
to substantially the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article. Nothing contained in this
Article 13 or elsewhere in this Indenture or in the Securities is intended to or
shall impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders, the right, which is absolute and unconditional, of
the Holder of any Security to convert such Security in accordance with Article
12.
ARTICLE 14
REPURCHASE OF SECURITIES AT THE OPTION OF THE HOLDERS UPON A
FUNDAMENTAL CHANGE
SECTION 14.01. Right to Require Repurchase. In the event that a
Fundamental Change shall occur at any time prior to __________, 2007, then each
Holder shall have the right, at the Holder's option, to require the Company to
repurchase, and upon the exercise of such right the Company shall repurchase,
all of such Holder's Securities, or any portion of the principal amount thereof
that is equal to U.S.$1,000 principal amount integral multiple thereof, on the
date (the "Fundamental Change Redemption Date") (or if such date is not a
Business Day, the next succeeding Business Day) that is 30 days after the date
of the Company Notice (as defined in Section 14.02) at the Fundamental Change
Redemption Price set forth in the form of Security. The Company shall also pay
accrued interest, if any, on such Securities to, but excluding, the Fundamental
Change Redemption Date; provided, however, that installments of interest on
Securities whose Stated Maturity is on or prior to the Fundamental Change
Redemption Date shall be payable to the Holders of such Securities, or one or
more Predecessor Securities, registered as such on the Regular Record Date
according to their terms and the provisions of Section 3.07. Such right to
require the repurchase of the Securities shall not continue after a discharge of
the Company from its obligations with respect to the Securities in accordance
with Article 4, unless a Fundamental Change shall have occurred prior to such
discharge. Whenever in this Indenture (including Sections 2.02, 3.01, 5.01(a)
and 5.08) there is a reference, in any context, to the principal of any Security
as of any time, such reference shall be deemed to include reference to the
Fundamental Change Redemption Price payable in respect of such Security to the
extent that such Fundamental Change Redemption Price is, was or would be so
payable at such time, and express mention of the Fundamental Change Redemption
Price in any provision of this Indenture shall not be construed as excluding the
Fundamental Change Redemption Price in those provisions of this Indenture when
such express mention is not made.
SECTION 14.02. Notices; Method of Exercising Repurchase Right, Etc. (a)
Unless the Company shall have theretofore called for redemption all of the
Outstanding Securities, on or before the 30th day after the occurrence of a
Fundamental Change, the Company or, at the request and expense of the Company,
the Trustee, shall give to all Holders of Securities, in the
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manner provided in Section 1.06, notice (the "Company Notice") of the occurrence
of the Fundamental Change and of the repurchase right set forth herein arising
as a result thereof. The Company shall also deliver a copy of such notice of a
repurchase right to the Trustee.
Each notice of a repurchase right shall state:
(i) the Fundamental Change Redemption Date,
(ii) the date by which the repurchase right must be exercised,
(iii) the Fundamental Change Redemption Price,
(iv) a description of the procedure which a Holder must follow to
exercise a repurchase right, and the place or places where such Securities
maturing after the Fundamental Change Redemption Date, are to be
surrendered for payment of the Fundamental Change Redemption Price and
accrued interest, if any,
(v) that on the Fundamental Change Redemption Date, the Fundamental
Change Redemption Price and accrued interest, if any, will become due and
payable to, but excluding, the Fundamental Change Redemption Date upon each
such Security designated by the Holder to be repurchased, and that interest
thereon shall cease to accrue on and after said date, and
(vi) the Conversion Price then in effect, the date on which the right
to convert the principal amount of the Securities to be repurchased will
terminate and the place or places where such Securities may be surrendered
for conversion.
No failure of the Company to give the foregoing notices or defect therein
shall limit any Holder's right to exercise a repurchase right or affect the
validity of the proceedings for the repurchase of Securities.
If any of the foregoing provisions or other provisions of this Article are
inconsistent with applicable law, such law shall govern.
(b) To exercise a repurchase right, a Holder shall deliver to the Trustee
or any Paying Agent on or before the 30th day after the date of the Company
Notice (or if such 30th day is not a Business Day, the immediately preceding
Business Day) the Security to be repurchased with the form entitled "Option to
Elect Redemption Upon a Fundamental Change" on the reverse thereof duly
completed, together with such Security duly endorsed for transfer.
Such written notice shall be irrevocable, except that the right of the
Holder to convert the Securities with respect to which the repurchase right is
being exercised shall continue until the close of business on the Business Day
prior to the Fundamental Change Redemption Date.
(c) In the event a repurchase right shall be exercised in accordance with
the terms hereof, the Company shall pay or cause to be paid to the Trustee or
the Paying Agent the Fundamental Change Redemption Price in cash, as provided
above, for payment to the Holder on the Fundamental Change Redemption Date
together with accrued and unpaid interest to the
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Fundamental Change Redemption Date payable with respect to the Securities as to
which their purchase right has been exercised; provided, however, that
installments of interest that mature on or prior to the Fundamental Change
Redemption Date shall be payable in cash, in the case of Securities, to the
Holders of such Securities, or one or more Predecessor Securities, registered as
such at the close of business on the relevant Regular Record Date.
(d) If any Security (or portion thereof) surrendered for repurchase shall
not be so paid on the Fundamental Change Redemption Date, the principal amount
of such Security (or portion thereof, as the case may be) shall, until paid,
bear interest to the extent permitted by applicable law from the Fundamental
Change Redemption Date at the rate of ____% per annum, and each Security shall
remain convertible into Common Stock until the principal of such Security (or
portion thereof, as the case may be) shall have been paid or duly provided for.
(e) Any Security which is to be repurchased only in part shall be
surrendered to the Trustee (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing), and the Company shall execute, and the Trustee
shall authenticate and make available for delivery to the Holder of such
Security without service charge, a new Security or Securities, containing
identical terms and conditions, each in an authorized denomination in aggregate
principal amount equal to and in exchange for the unrepurchased portion of the
principal of the Security so surrendered.
(f) All securities delivered for repurchase shall be delivered to the
Trustee, the Paying Agent or any other agents (as shall be set forth in the
Company Notice) to be canceled by or at the direction of the Trustee, which
shall dispose of the same as provided in Section 3.09.
(g) The Company will comply with the provisions of Rule 13e-4 and any other
tender offer rules under the Exchange Act to the extent then applicable in
connection with the redemption rights of Holders in the event of a Fundamental
Change.
SECTION 14.03. Merger, Consolidation, Etc. In the case of any merger,
consolidation, sale or transfer of all or substantially all of the assets of the
Company to which Section 12.11 applies, in which the Common Stock of the Company
is changed or exchanged as a result into the right to receive shares of stock
and other securities or property or assets (including cash) which includes
Common Stock of the Company or common stock of another Person that are, or upon
issuance will be, traded on a United States national securities exchange or
approved for trading on an established automated over-the-counter trading market
in the United States and such shares constitute at the time such change or
exchange becomes effective in excess of 50% of the aggregate fair market value
of such shares of stock and other securities, property and assets (including
cash) (as determined by the Company, which determination shall be conclusive and
binding), then the Company and the Person resulting from such merger or
consolidation or which acquires the properties or assets (including cash) of the
Company, as the case may be, shall execute and deliver to the Trustee a
supplemental indenture (which shall comply with the Trust Indenture Act as in
force at the date of execution of such supplemental indenture) modifying the
provisions of this Indenture relating to the right of Holders to cause the
Company to repurchase the Securities following a Fundamental Change, including
without limitation the applicable provisions of this Article and the definitions
of the Common Stock and Fundamental
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Change, as appropriate, and such other related definitions set forth herein as
determined in good faith by the Company and the Company (which determination
shall be conclusive and binding), to make such provisions apply in the event of
a subsequent Fundamental Change to the common stock and the issuer thereof if
different from the Company and the Common Stock of the Company (in lieu of the
Company and Common Stock of the Company).
ARTICLE 15
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 15.01. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not more than 15 days after the Regular Record
Date, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders of Securities as of such Regular Record
Date, and
(b) at such other times as the Trustee may reasonably request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than 15
days prior to the time such list is furnished;
provided, however, that no such list need be furnished so long as the Trustee is
acting as Note Registrar.
SECTION 15.02. Trustee to Furnish Company Names and Addresses of Holders.
The Trustee will furnish or cause to be furnished to the Company, or to
Company's counsel:
(a) within 10 days from the date of this Indenture, an updated Note
Register,
(b) semi-annually, not more than 15 days after the Regular Record
Date, an updated Note Register, in such form as the Company may reasonably
require, of the names and addresses of the Holders of Securities as of such
Regular Record Date, and
(c) at such other times as the Trustee may reasonably request in
writing, within 30 days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than 15
days prior to the time such list is furnished; provided, however, that no
such list need be furnished so long as the Trustee is not acting as Note
Registrar.
SECTION 15.03. Preservation of Information. (a) The Trustee shall
preserve, in as current a form as is reasonably practicable, the names and
addresses of Holders contained in the most recent list furnished to the Trustee
as provided in Section 15.01, if any, and the names and addresses of Holders
received by the Trustee in its capacity as Note Registrar. The Trustee may
destroy any list furnished to it pursuant to Section 15.01 upon receipt of a new
list so furnished.
(b) If and when this Indenture has become qualified under the Trust
Indenture Act, the rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
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(c) Every Holder of Securities, by receiving and holding the same, agrees
with the Company and the Trustee that neither the Company nor the Trustee nor
any agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made hereunder.
SECTION 15.04. Reports by Trustee. (a) If and when this Indenture
becomes qualified under the Trust Indenture Act, the Trustee shall transmit to
Holders such reports concerning the Trustee and its actions under this Indenture
as may be required pursuant to the Trust Indenture Act at the times and in the
manner provided pursuant thereto.
(b) If and when this Indenture becomes qualified under the Trust Indenture
Act, a copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when the Securities are listed on any stock exchange.
SECTION 15.05. Reports by Company. If and when this Indenture becomes
qualified under the Trust Indenture Act, the Company shall file with the Trustee
and the Commission, and transmit to Holders, such information, documents and
other reports, and such summaries thereof, as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant to such
Act; provided that any such information, documents or reports required to be
filed with the Commission pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 shall be filed with the Trustee within 15 days after the
same is so required to be filed with the Commission.
____________________________
This Indenture may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed all as of the day and year first above written.
VENTRO CORPORATION
By:_______________________________
Name:
Title:
[STATE STREET BANK AND TRUST COMPANY OF
CALIFORNIA, N.A.], as Trustee
By:_______________________________
Name:
Title:
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