EXHIBIT (4)
XXXXXXX XXXXX & CO., INC.
(a Delaware corporation)
Liquid Yield Option/TM/ Notes due 2032
(Zero Coupon - Floating Rate - Senior)
___________________________
INDENTURE
Dated as of March 13, 2002
___________________________
JPMORGAN CHASE BANK,
Trustee
____________________
/TM/ Trademark of Xxxxxxx Xxxxx & Co., Inc.
Table of Contents
Page
----
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions............................................................................1
Section 1.02. Other Definitions......................................................................7
Section 1.03. Rules of Construction..................................................................8
Section 1.04. Acts of Holders........................................................................8
ARTICLE II
THE SECURITIES
Section 2.01. Form and Dating........................................................................9
Section 2.02. Execution and Authentication..........................................................10
Section 2.03. Registrar, Paying Agent, Conversion Agent and Depositary..............................10
Section 2.04. Paying Agent To Hold Money and Securities in Trust....................................11
Section 2.05. Securityholder Lists..................................................................11
Section 2.06. Transfer and Exchange.................................................................11
Section 2.07. Replacement Securities................................................................12
Section 2.08. Outstanding Securities; Determinations of Holders' Action.............................13
Section 2.09. Temporary Securities..................................................................14
Section 2.10. Cancellation..........................................................................14
Section 2.11. Global Securities.....................................................................15
Section 2.12. CUSIP Numbers.........................................................................15
ARTICLE III
REDEMPTION AND PURCHASES
Section 3.01. Right to Redeem; Notices to Trustee...................................................16
Section 3.02. Selection of Securities to Be Redeemed................................................16
Section 3.03. Notice of Redemption..................................................................16
Section 3.04. Effect of Notice of Redemption........................................................17
Section 3.05. Deposit of Redemption Price...........................................................18
Section 3.06. Securities Redeemed in Part...........................................................18
Section 3.07. [Reserved]............................................................................18
Section 3.08. Purchase of Securities at the Option of the Holder....................................18
Section 3.09. Purchase of Securities at Option of the Holder upon Change in Control.................25
Section 3.10. Effect of Purchase Notice or Change in Control Purchase Notice........................28
Section 3.11. Deposit of Purchase Price or Change in Control Purchase Price.........................29
Section 3.12. Securities Purchased in Part..........................................................29
i
Section 3.13. Covenant to Comply With Securities Laws Upon Purchase of Securities...................29
Section 3.14. Repayment to the Company..............................................................30
ARTICLE IV
COVENANTS
Section 4.01. Payment of Securities.................................................................30
Section 4.02. SEC Reports...........................................................................30
Section 4.03. Compliance Certificate; Notice of Defaults............................................30
Section 4.04. Further Instruments and Acts..........................................................31
Section 4.05. Maintenance of Office or Agency.......................................................31
Section 4.06. Calculation of Certain Amounts........................................................31
Section 4.07. Limitation Upon Creation of Liens on Voting Stock of Certain Subsidiaries.............32
Section 4.08. Limitation on Disposition of Voting Stock of, and Xxxxxx and Sale of Assets
by, MLPF&S............................................................................32
Section 4.09. Waiver of Certain Covenants...........................................................32
ARTICLE V
SUCCESSOR CORPORATION
Section 5.01. When Company May Merge or Transfer Assets.............................................34
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.....................................................................35
Section 6.02. Acceleration..........................................................................36
Section 6.03. Other Remedies........................................................................36
Section 6.04. Waiver of Past Defaults...............................................................37
Section 6.05. Control by Majority...................................................................37
Section 6.06. Limitation on Suits...................................................................37
Section 6.07. Rights of Holders to Receive Payment..................................................38
Section 6.08. Collection Suit by Trustee............................................................38
Section 6.09. Trustee May File Proofs of Claim......................................................38
Section 6.10. Priorities............................................................................39
Section 6.11. Undertaking for Costs.................................................................39
Section 6.12. Waiver of Stay, Extension or Usury Laws...............................................39
ARTICLE VII
TRUSTEE
Section 7.01. Rights of Trustee.....................................................................40
Section 7.02. Individual Rights of Trustee..........................................................40
ii
Section 7.03. Trustee's Disclaimer..................................................................40
Section 7.04. Notice of Defaults....................................................................40
Section 7.05. Reports by Trustee to Holders.........................................................41
Section 7.06. Compensation and Indemnity............................................................41
Section 7.07. Replacement of Trustee................................................................42
Section 7.08. Successor Trustee by Merger...........................................................42
Section 7.09. Eligibility; Disqualification.........................................................43
Section 7.10. Preferential Collection of Claims Against Company.....................................43
ARTICLE VIII
DISCHARGE OF INDENTURE
Section 8.01. Discharge of Liability on Securities..................................................43
Section 8.02. Repayment to the Company..............................................................43
ARTICLE IX
AMENDMENTS
Section 9.01. Without Consent of Holders............................................................44
Section 9.02. With Consent of Holders...............................................................44
Section 9.03. Compliance with Trust Indenture Act...................................................45
Section 9.04. Revocation and Effect of Consents, Xxxxxxx and Actions................................45
Section 9.05. Notation on or Exchange of Securities.................................................45
Section 9.06. Trustee to Sign Supplemental Indentures...............................................45
Section 9.07. Effect of Supplemental Indentures.....................................................46
ARTICLE X
CONTINGENT INTEREST
Section 10.01. Contingent Interest...................................................................46
Section 10.02. Payment of Contingent Interest; Contingent Interest Rights Preserved..................47
Section 10.03. Bid Solicitation Agent................................................................47
ARTICLE XI
CONVERSION
Section 11.01. Conversion Privilege..................................................................47
Section 11.02. Conversion Procedure..................................................................48
Section 11.03. Fractional Shares.....................................................................49
Section 11.04. Taxes on Conversion...................................................................49
Section 11.05. Company to Provide Stock..............................................................49
Section 11.06. Adjustment for Change in Capital Stock................................................50
Section 11.07. Adjustment for Rights Issue...........................................................50
Section 11.08. Adjustment for Other Distributions....................................................52
iii
Section 11.09. When Adjustment May Be Deferred.......................................................54
Section 11.10. When No Adjustment Required...........................................................54
Section 11.11. Notice of Adjustment..................................................................54
Section 11.12. Voluntary Increase....................................................................55
Section 11.13. Notice of Certain Transactions........................................................56
Section 11.14. Reorganization of Company; Special Distributions......................................56
Section 11.15. Company Determination Final...........................................................57
Section 11.16. Trustee's Adjustment Disclaimer.......................................................57
Section 11.17. Simultaneous Adjustments..............................................................57
Section 11.18. Successive Adjustments................................................................57
Section 11.19. Rights Issued in Respect of Common Stock Issued Upon Conversion.......................57
ARTICLE XII
PAYMENT OF CONTINGENT INTEREST
Section 12.01. Interest Payments.....................................................................58
Section 12.02. Defaulted Interest....................................................................58
Section 12.03. Interest Rights Preserved. ...........................................................59
ARTICLE XIII
MISCELLANEOUS
Section 13.01. Trust Indenture Act Controls..........................................................59
Section 13.02. Notices...............................................................................59
Section 13.03. Communication by Holders with Other Holders...........................................60
Section 13.04. Certificate and Opinion as to Conditions Precedent....................................60
Section 13.05. Statements Required in Certificate or Opinion.........................................60
Section 13.06. Separability Clause...................................................................61
Section 13.07. Rules By Trustee, Paying Agent, Conversion Agent and Registrar........................61
Section 13.08. [Reserved]............................................................................61
Section 13.09. GOVERNING LAW.........................................................................61
Section 13.10. No Recourse Against Others............................................................61
Section 13.11. Successors............................................................................61
Section 13.12. Multiple Originals....................................................................61
Section 13.13. References............................................................................61
Section 13.14. Calculations..........................................................................61
Section 13.15. Tax Matters...........................................................................62
SIGNATURES
ANNEX A
EXHIBIT A
iv
CROSS-REFERENCE TABLE*
TIA Indenture
Section Section
------- -------
310(a)(1) ..........................................................7.09
(a)(2) ..........................................................N.A.
(a)(3) ..........................................................N.A.
(a)(4) ..........................................................N.A.
(b)(1) ..........................................................7.09
(c) ..........................................................N.A.
311(a) ..........................................................7.10
(b) ..........................................................7.10
(c) ..........................................................N.A.
312(a) ..........................................................2.05
(b) .........................................................13.03
(c) .........................................................13.03
313(a) ..........................................................7.05
(b) ..........................................................7.05
(c) ..........................................................N.A.
(d) ..........................................................N.A.
314(a) ..........................................................4.02
(b) ..........................................................N.A.
(c)(1) ..........................................................N.A.
(c)(2) ..........................................................N.A.
(c)(3) ..........................................................N.A.
(d) ..........................................................N.A.
(e) ..........................................................N.A.
(f) ..........................................................4.04
315(a) ..........................................................7.01
(b) ..........................................................7.04
(e) ..........................................................6.11
316(a)(last sentence) ..............................................2.08
(a)(1)(A) ......................................................6.05
(a)(1)(B) ......................................................6.04
(a)(2) ..........................................................N.A.
(b) ..........................................................N.A.
317(a)(1) ..........................................................N.A.
(a)(2) ..........................................................N.A.
(b) ..........................................................2.04
318(a) ..........................................................N.A.
N.A. means Not Applicable. _______________
*Note: This Cross Reference Table shall not, for any purpose, be deemed to
be part of the Indenture.
v
INDENTURE, dated as of March 13, 2002, between Xxxxxxx Xxxxx & Co., Inc., a
Delaware corporation (the "Company"), and JPMorgan Chase Bank, a banking
corporation organized and existing under the laws of the State of New York, as
trustee (the "Trustee").
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the Holders of the Company's Liquid Yield
Option/TM/ Notes due 2032 (Zero Coupon - Floating Rate - Senior) (the
"Securities"):
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
-----------
"Affiliate" of any specified person means any other person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For the purposes of this definition,
"control", when used with respect to any specified person, means the power to
direct or cause the direction of the management and policies of such person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Average Sale Price" means the average of the Sale Prices of the Common
Stock or other security for which the Average Sale Price is to be determined for
the shorter of (1) 30 consecutive Trading Days ending on the last full Trading
Day prior to the Time of Determination with respect to the rights, warrants or
options or distribution in respect of which the Average Sale Price is being
calculated, or (2) the period (x) commencing on the date next succeeding the
first public announcement of (a) the issuance of rights, warrants or options or
(b) the distribution, in each case, in respect of which the Average Sale Price
is being calculated and (y) proceeding through the last full Trading Day prior
to the Time of Determination with respect to the rights, warrants or options or
distribution in respect of which the Average Sale Price is being calculated
(excluding days within such period, if any, which are not Trading Days), or (3)
the period, if any, (x) commencing on the date next succeeding the Ex-Dividend
Time with respect to the next preceding (a) issuance of rights, warrants or
options or (b) distribution, in each case, for which an adjustment is required
by the provisions of Section 11.06(d) or 11.07 and (y) proceeding through the
last full Trading Day prior to the Time of Determination with respect to the
rights, warrants or options or distribution in respect of which the Average Sale
Price is being calculated (excluding days within such period, if any, which are
not Trading Days).
In the event that the Ex-Dividend Time (or in the case of a subdivision,
combination or reclassification, the effective date with respect thereto) with
respect to a dividend, subdivision, combination or reclassification to which
Section 11.06(a), (b), (c) or (d) applies occurs during the period applicable
for calculating "Average Sale Price" pursuant to the definition in the preceding
sentence, "Average Sale Price" shall be calculated for such period in a manner
determined by the Board of Directors of the Company to reflect the impact of
such dividend, subdivision, combination or reclassification on the Sale Price of
the Common Stock or such other security during such period.
"Bankruptcy Law" means Title 11, United States Code, or any similar Federal
or state law for the relief of debtors.
"Board of Directors" or "Board" means, with respect to any matter, either
the board of directors of the Company or any committee of such board duly
authorized, with respect to such matter, to exercise the powers of such board.
"Business Day" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which commercial banks are authorized or
required by law, regulation or executive order to close in The City of New York.
"Cash" or "cash" means such coin or currency of The United States of
America as at any time of payment is legal tender for the payment of public and
private debts.
"Common Stock" means the Common Stock, par value $1.33 1/3 per share,
including the Rights attached thereto of the Company, as it exists on the date
of this Indenture or any other shares of capital stock of the Company into which
such common stock shall be reclassified or changed.
"Company" means the party named as the "Company" in the first paragraph of
this Indenture until a successor replaces it pursuant to the applicable
provisions of this Indenture and, thereafter, shall mean such successor. The
foregoing sentence shall likewise apply to any subsequent such successor or
successors.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by either of its Chairman or Vice Chairman of
the Board, its President, any Vice President or its Treasurer, and by an
Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to
the Trustee.
"Contingent Principal Amount" of a Security means the Original Principal
Amount increased daily by the applicable Yield. The Contingent Principal Xxxxxx
will accrue daily at the applicable Yield applied to the Contingent Principal
Amount of the Security as of the day immediately preceding the most recent Yield
Reset Date.
"Controlled Subsidiary" means any corporation more than 80% of the
outstanding Voting Stock, except for qualifying shares, of which shall at the
time be owned directly or indirectly by the Company.
"corporation" includes corporations, associations, companies and business
trusts.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
"Default" means any event that is, or after notice or passage of time or
both would be, an Event of Default.
"Depositary" means, with respect to the Securities issuable or issued in
whole or in part in global form, the person specified in Section 2.03 as the
Depositary with respect to the
2
Securities, until a successor shall have been appointed and become such pursuant
to the applicable provision of this Indenture, and, thereafter, "Depositary"
shall mean or include such successor. The foregoing sentence shall likewise
apply to any subsequent such successor or successors.
"Global Securities" means Securities that are in the form of the Securities
attached hereto as Exhibit A.
"Holder" or "Securityholder" means a person in whose name a Security is
registered on the Registrar's books.
"Indenture" means this Indenture as amended or supplemented from time to
time in accordance with the terms hereof, including the provisions of the TIA
that are deemed to be a part hereof.
"Issue Date" of any Security means the date on which the Security was
originally issued or deemed issued as set forth on the face of the Security.
"Issue Price" of each Security means, in connection with the original
issuance of such Security, the initial issue price at which the Security is sold
as set forth on the face of the Security.
"London Banking Day" means a day on which commercial banks are open for
business, including dealings in United States dollars, in London.
"Market Price" means the average of the Sale Prices of the Common Stock or
other security for which the Market Price is to be determined for the five
Trading Day period ending on (if the third Business Day prior to the applicable
Purchase Date is a Trading Day, or if not, then on the last Trading Day prior
to) the third Business Day immediately prior to, but not including, the
applicable Purchase Date, appropriately adjusted to take into account the actual
occurrence, during the period commencing on the first of such Trading Days
during such five Trading Day period and ending on such Purchase Date, of any
event described in Section 11.06, 11.07 or 11.08 that would result in an
adjustment to the Conversion Rate; subject, however, to the conditions set forth
in Sections 11.09 and 11.10.
"MLPF&S" means Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated, a
Delaware corporation.
"Moneyline Telerate Page 3750" means the display on Moneyline Telerate (or
any successor service) on such page (or any other page as may replace such page
on such service) for the purpose of displaying the London interbank rates of
major banks for United States dollars.
"Officer" means Chairman of the Board, the President, any Vice President,
the Treasurer, the Secretary, any Assistant Treasurer or Assistant Secretary of
the Company.
"Officers' Certificate" means a written certificate containing the
information specified in Sections 13.04 and 13.05, if applicable, signed in the
name of the Company by the Chairman of
3
the Board, the President, a Vice President or the Treasurer and by an Assistant
Treasurer, the Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Opinion of Counsel" means a written opinion containing the information
specified in Sections 13.04 and 13.05, if applicable, rendered by legal counsel
who may be (i) an employee of, or counsel to, the Company or (ii) other counsel
designated by the Company and acceptable in the reasonable judgment of the
Trustee.
"Original Principal Amount" of each Security means the original principal
amount as set forth on the face of the Security.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof or any other entity.
"Principal", "Principal Amount" or "principal amount" of a Security on any
date means the Contingent Principal Amount of such Security on such date.
"Purchase Date" shall mean each of March 13, 2005, March 13, 2007, March
13, 2012, March 13, 2017, March 13, 2022 and March 13, 2027.
"Purchase Price" of a Security means the Contingent Principal Amount of the
Security on the applicable Purchase Date.
"Redemption" or "redemption" shall have the meaning set forth in Section
3.01.
"Redemption Date" or "redemption date" shall mean the date specified for
redemption of any of the Securities in accordance with the terms of the
Securities and this Indenture.
"Redemption Price" or "redemption price" shall have the meaning set forth
in paragraph 6 of the Securities.
"Regular cash dividends" means quarterly or other periodic cash dividends
on the Common Stock as declared by the Board as part of its cash dividend
payment practices and that are not designated by the Board as extraordinary or
special or other nonrecurring dividends.
"Rights" means the preferred stock purchase rights issued pursuant to the
Amended and Restated Rights Agreement of the Company adopted on December 2,
1997, as amended or restated from time to time.
"Sale Price" of a single share of Common Stock or unit of any other
security for which the Sale Price is to be determined on any Trading Day means
the closing per share sale price for the Common Stock or such other security (or
if no closing sale price is reported, the average of the bid and ask prices or,
if more than one in either case, the average of the average bid and the average
ask prices) on such Trading Day as reported on The New York Stock Exchange or
other principal United States securities exchange on which the Common Stock or
such other security is traded or, if the Common Stock or such other security is
not listed on a United States national or regional stock exchange, as reported
by the National Association of Securities Dealers Automated Quotation System or
by the National Quotation Bureau Incorporated. In the absence
4
of a quotation, the Company will determine the Sale Price on the basis of such
quotations as it considers appropriate.
"SEC" means the Securities and Exchange Commission.
"Securities" means any of the Company's Liquid Yield Option/TM/ Notes due
2032 (Zero Coupon - Floating Rate - Senior), as amended or supplemented from
time to time in accordance with the terms hereof, issued under this Indenture.
"Securityholder" or "Holder" means a person in whose name a Security is
registered on the Registrar's books.
"Stated Maturity", when used with respect to any Security, means the date
specified in such Security as the final fixed date on which the Contingent
Principal Amount of such Security is due and payable.
"Subsidiary" means any corporation of which at the time of determination
the Company and/or one or more Subsidiaries owns or controls directly or
indirectly more than 50% of the shares of Voting Stock. "Wholly-owned", when
used with reference to a Subsidiary, means a Subsidiary of which all of the
outstanding capital stock (except for qualifying shares) is owned by the Company
or by one or more wholly-owned Subsidiaries.
"Tax Original Issue Discount" means the amount of ordinary interest income
on a Security that must be accrued as original issue discount for United States
Federal income tax purposes.
"3-month LIBOR" means the rate determined on the Yield Determination Date
next preceding the related Yield Reset Date as:
(a) the rate for 3-month deposits in United States dollars commencing on
the related Yield Reset Date, that appears on the Moneyline Telerate Page 3750
as of 11:00 A.M., London time, on the Yield Determination Date, or
(b) if fewer than two offered rates appear, or no rate appears, as the
case may be, on the particular Yield Determination Date on the Moneyline
Telerate Page 3750, the rate calculated by the Company of at least two offered
quotations obtained by the Company after requesting the principal London offices
of each of four major reference banks (which shall not include Affiliates of the
Company) in the London interbank market to provide the Company with its offered
quotation for deposits in United States dollars for the period of three months,
commencing on the related Yield Reset Date, to prime banks in the London
interbank market at approximately 11.00 A.M., London time, on that Yield
Determination Date and in a principal amount that is representative for a single
transaction in United States dollars in that market at that time, or
(c) if fewer than two offered quotations referred to in clause (b) are
provided as requested, the rate calculated by the Company as the arithmetic mean
of the rates quoted at approximately 11:00 A.M., New York time, on the
particular Yield Determination Date by three major banks (which shall not
include Affiliates of the Company) in The City of New York
5
selected by the Company for loans in United States dollars to leading European
banks for a period of three months and in a principal amount that is
representative for a single transaction in United States dollars in that market
at that time, or
(d) if the banks so selected by the Company are not quoting as mentioned
in clause (c), LIBOR in effect on the particular Yield Determination Date.
"TIA" means the Trust Indenture Act of 1939, as amended by the Trust
Indenture Reform Act of 1990, and as in effect on the date of this Indenture.
"Time of Determination" means the time and date of the determination of
stockholders entitled to receive rights, warrants, options or a distribution, in
each case, to which Sections 11.07 or 11.08 apply.
"Trading Day" means a day during which trading in securities generally
occurs on The New York Stock Exchange or, if the Common Stock is not listed on
The New York Stock Exchange, on the principal other national or regional
securities exchange on which the Common Stock is then listed or, if the Common
Stock is not listed on a national or regional securities exchange, on the
National Association of Securities Dealers Automated Quotation system or, if the
Common Stock is not quoted on the National Association of Securities Dealers
Automated Quotation System, on the principal other market on which the Common
Stock is then traded.
"Trust Officer" means any officer of the Trustee assigned by the Trustee to
administer its corporate trust matters.
"Trustee" means the party named as the "Trustee" in the first paragraph of
this Indenture until a successor replaces it pursuant to the applicable
provisions of this Indenture and, thereafter, shall mean such successor.
"Voting Stock" means stock of the class or classes having general voting
power under ordinary circumstances to elect at least a majority of the board of
directors, managers or trustees of such corporation provided that, for the
purposes hereof, stock which carries only the right to vote conditionally on the
happening of an event shall not be considered voting stock whether or not such
event shall have happened.
"Yield" from the Issue Date through and including June 12, 2002 will equal
0% per annum and will be reset quarterly effective on each Yield Reset Date to
3-month LIBOR minus 2.0% per annum. Regardless of the level of 3-month LIBOR,
the Yield shall never be less than zero and, after March 13, 2007, the Yield
shall not exceed 5.5% per annum. The Yield shall be calculated using the actual
number of days elapsed between the Yield Reset Dates divided by 360.
"Yield Determination Date" means the second London Banking Day preceding
the related Yield Reset Date.
"Yield Reset Date" means each March 13, June 13, September 13 and December
13 of each year, commencing on June 13, 2002; provided, however, that if any
Yield Reset Date would otherwise be a day that is not a Business Day, that Yield
Reset Date will be postponed to the next
6
succeeding Business Day, except if that Business Day falls in the next
succeeding calendar month, that Yield Reset Date will be the immediately
preceding Business Day.
Section 1.02 Other Definitions.
-----------------
Term Defined in Section
------------------------------------------------- ----------------------
"Agent Members" 2.11
-------------
"Associate" 3.09(a)
---------
"Bankruptcy Law" 6.01
--------------
"Bid Solicitation Agent" 2.03
----------------------
"Change in Control" 3.09(a)
-----------------
"Change in Control Purchase Date" 3.09(a)
-------------------------------
"Change in Control Purchase Notice" 3.09(c)
---------------------------------
"Change in Control Purchase Price" 3.09(a)
--------------------------------
"Company Notice" 3.08(e)
--------------
"Company Notice Date" 3.08(c)
-------------------
"Common Stock Record Date" 10.01
------------------------
"Contingent Interest Payment Date" 10.02
--------------------------------
"Conversion Agent" 2.03
----------------
"Conversion Date" 11.02
---------------
"Conversion Rate" 11.01
---------------
"Defaulted Interest" 12.02
------------------
"DTC" 2.03
---
"Event of Default" 6.01
----------------
"Exchange Act" 3.08(d)
------------
"Ex-Dividend Measurement Period" 11.08
------------------------------
"Ex-Dividend Time" 11.01
----------------
"Extraordinary Cash Dividend" 11.08
---------------------------
"XXXXx Market Price" 10.01
------------------
"Measurement Period" 10.01
------------------
"Notice of Default" 6.01
-----------------
"Paying Agent" 2.03
------------
"Purchase Notice" 3.08(a)
---------------
"Registrar" 2.03
---------
"Regular Record Date" 12.01
-------------------
"Relevant Value" 10.01
--------------
"Securities Act" 3.08(d)
--------------
"Semiannual Period" 10.01
-----------------
"Time of Determination" 11.01
---------------------
Whenever this Indenture refers to a provision of the TIA, such provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
----------
"indenture securities" means the Securities.
--------------------
"indenture security holder" means a Securityholder.
-------------------------
7
"indenture to be qualified" means this Indenture.
-------------------------
"indenture trustee" or "institutional trustee" means the Trustee.
----------------- ---------------------
"obligor" on the indenture securities means the Company.
-------
All other TIA terms used in this Indenture that are defined by the TIA or
defined by TIA reference to another statute or regulation have the meanings
assigned to them by such definitions.
Section 1.03. Rules of Construction. Unless the context otherwise requires:
---------------------
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning assigned to
it in accordance with generally accepted accounting principles as in effect from
time to time in The United States of America;
(c) "or" is not exclusive;
(d) "including" means including, without limitation; and
(e) words in the singular include the plural, and words in the plural
include the singular.
Section 1.04. Acts of Holders.
---------------
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by their
agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as
the "Act" of Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and conclusive in
favor of the Trustee and the Company, if made in the manner provided in
this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer
authorized by law to take acknowledgements of deeds, certifying that the
individual signing such instrument or writing acknowledged to such officer
the execution thereof. Where such execution is by a signer acting in a
capacity other than such signer's individual capacity, such certificate or
affidavit shall also constitute sufficient proof of such signer's
authority. The fact and date of the execution
8
of any such instrument or writing, or the authority of the Person executing
the same, may also be proved in any other manner which the Trustee deems
sufficient.
(c) The ownership of Securities shall be proved by the register for
the Securities or by a certificate of the Registrar (as defined below).
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the
Trustee or the Company in reliance thereon, whether or not notation of such
action is made upon such Security.
(e) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company
may, at its option, by or pursuant to a resolution of the Board of
Directors, fix in advance a record date for the determination of Holders
entitled to give such request, demand, authorization, direction, notices,
consent, waiver or other Act, but the Company shall have no obligation to
do so. If such a record date is fixed, such request, demand, authorization,
direction, notice, consent, waiver or other Act may be given before or
after such record date, but only the Holders of record at the close of
business on such record date shall be deemed to be Holders for purposes of
determining whether Holders of the requisite proportion of outstanding
Securities have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other Act, and for
that purpose the outstanding Securities shall be computed as of such record
date; provided that no such authorization, agreement or consent by the
Holders on such record date shall be deemed effective unless it shall
become effective pursuant to the provisions of this Indenture not later
than six months after the record date.
ARTICLE II
THE SECURITIES
Section 2.01. Form and Dating. The Securities and the Trustee's certificate
---------------
of authentication shall be substantially in the form of Exhibit A, which is a
part of this Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rule or usage (provided that any
such notation, legend or endorsement required by usage is in a form acceptable
to the Company and the Trustee). Each Security shall be dated the date of its
authentication.
The Securities shall be issued, initially in the form of one or more global
Securities, which shall be deposited with DTC or the nominee thereof, duly
executed by the Company and authenticated by the Trustee as hereinafter
provided.
Each global Security shall represent such of the outstanding Securities as
shall be specified therein and each shall provide that it shall represent the
aggregate amount of outstanding Securities from time to time endorsed thereon
and that the aggregate amount of outstanding Securities represented thereby may
from time to time be reduced to reflect
9
conversions, repurchases and redemptions. Any endorsement of a global
Security to reflect the amount of any decrease in the amount of outstanding
Securities represented thereby shall be made by the Trustee in accordance
with instructions given by the Holder thereof as required by Section 2.11.
Section 2.02. Execution and Authentication. The Securities shall be
----------------------------
executed by the Company by either of its Chairman or Vice Chairman of the Board,
its President, its Treasurer or one of its Vice Presidents. The signature of any
of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the Issue Date of such Securities.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein duly
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
The Trustee shall authenticate and deliver Securities for original issue in
an aggregate Original Principal Amount of $2,300,000,000 upon a Company Order
without any further action by the Company. The aggregate Original Principal
Amount of Securities outstanding at any time may not exceed the amount set forth
in the foregoing sentence, subject to the proviso set forth therein, except as
provided in Section 2.07.
Section 2.03. Registrar, Paying Agent, Conversion Agent and Depositary. The
--------------------------------------------------------
Company shall maintain an office or agency where Securities may be presented for
registration of transfer or for exchange ("Registrar"), an office or agency
where Securities may be presented for purchase or payment ("Paying Agent") and
an office or agency where Securities may be presented for conversion
("Conversion Agent"). The Company shall also appoint a bid solicitation agent
(the "Bid Solicitation Agent") to act pursuant to paragraph 5 of the Security.
None of the Company or any Subsidiary or Affiliate of either may act as Bid
Solicitation Agent. The Registrar shall keep a register of the Securities and of
their transfer and exchange. The Company may have one or more co-registrars, one
or more additional paying agents and one or more additional conversion agents.
The term Paying Agent includes any additional paying agent. The term Conversion
Agent includes any additional conversion agent.
The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent, Conversion Agent or co-registrar other than the
Trustee. The agreement shall implement the provisions of this Indenture that
relate to such agent. The Company shall notify the Trustee and the Holders of
the name and address of any such agent and of any change in the office or agency
referred to in Section 4.05. If the Company fails to maintain a Registrar,
Paying Agent or Conversion Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 7.06. The
Company or any Subsidiary or an Affiliate of either of them may act as Paying
Agent, Registrar, Conversion Agent or co-registrar.
10
The Company initially appoints the Trustee as Registrar, Conversion Agent
and Paying Agent in connection with the Securities.
The Company initially appoints The Depositary Trust Company ("DTC") to act
as Depositary with respect to the global Securities.
Section 2.04. Paying Agent To Hold Money and Securities in Trust. In
--------------------------------------------------
accordance with Section 4.05 and except as otherwise provided herein, prior to
or on each due date of payments in respect of any Security, the Company shall
deposit with the Paying Agent a sum of money or, if permitted by the terms
hereof, securities sufficient to make such payments when so becoming due. The
Company shall require each Paying Agent (other than the Trustee) to agree in
writing that the Paying Agent shall hold in trust for the benefit of
Securityholders or the Trustee all money and securities held by the Paying Agent
for the making of payments in respect of the Securities and shall notify the
Trustee of any default by the Company in making any such payment. At any time
during the continuance of any default by the Company in making any payments in
respect of the Securities, the Paying Agent shall, upon the written request of
the Trustee, forthwith pay to the Trustee all money and securities so held in
trust. If the Company, a Subsidiary or an Affiliate of either of them acts as
Paying Agent, it shall segregate the money and securities held by it as Paying
Agent and hold it as a separate trust fund. The Company at any time may require
a Paying Agent to pay all money and securities held by it to the Trustee and to
account for any money and securities disbursed by it. Upon doing so, the Paying
Agent shall have no further liability for the money and securities.
Section 2.05. Securityholder Lists. The Trustee shall preserve in as
--------------------
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall furnish or cause to be furnished to the Trustee (i)
at least semiannually on May 15 and November 15 a list of the names and
addresses of Securityholders dated within 15 days of the date on which the list
is furnished and (ii) at such other times as the Trustee may request in writing
a list, in such form and as of such date as the Trustee may reasonably require,
of the names and addresses of Securityholders.
Section 2.06. Transfer and Exchange. Upon surrender for registration of
---------------------
transfer of any Security, together with a written instrument of transfer
reasonably satisfactory to the Trustee duly executed by the Securityholder or
such Securityholder's attorney duly authorized in writing, at the office or
agency of the Company designated as Registrar or co-registrar pursuant to
Section 2.03 or at the office or agency referred to in Section 4.05, 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 denomination or denominations, of a like aggregate Contingent
Principal Amount. The Company shall not charge a service charge for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to pay all taxes, assessments or other governmental charges that
may be imposed in connection with the transfer or exchange of the Securities
from the Securityholder requesting such transfer or exchange (other than any
exchange of a temporary Security for a definitive Security not involving any
change in ownership).
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination or denominations, of a like aggregate
Contingent Principal Amount,
11
upon surrender of the Securities to be exchanged, together with a written
instrument of transfer reasonably satisfactory to the Registrar duly executed by
the Securityholder or such Securityholder's attorney duly authorized in writing,
at such office or agency. Whenever any Securities are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Holder making the exchange is entitled to
receive.
The Company shall not be required to make, and the Registrar need not
register, transfers or exchanges of (a) Securities selected for redemption
(except, in the case of Securities to be redeemed in part, the portion thereof
not to be redeemed), (b) any Securities in respect of which a Purchase Notice or
a Change in Control Purchase Notice has been given and not withdrawn by the
Holder thereof in accordance with the terms of this Indenture (except, in the
case of Securities to be purchased in part, the portion thereof not to be
purchased) or (c) any Securities for a period of 15 days before the mailing of a
notice of redemption.
Notwithstanding any provision to the contrary herein, so long as a global
Security remains outstanding and is held by or on behalf of the Depositary,
transfers of a global Security, in whole or in part, shall be made only in
accordance with Section 2.11 and this Section 2.06. Transfers of a global
Security shall be limited to transfers of such global Security in whole, or in
part, to nominees of the Depositary or to a successor of the Depositary or such
successor's nominee.
Section 2.07. Replacement Securities. If (a) any mutilated Security is
----------------------
surrendered to the Company or the Trustee, or (b) the Company and the Trustee
receive evidence to their satisfaction of the destruction, loss or theft of any
Security, and there is delivered to the Company and the Trustee such security or
indemnity as may be required by them to save each of them harmless, then, in the
absence of notice to the Company or the Trustee that such Security has been
acquired by a bona fide purchaser, the Company shall execute, and upon its
written request the Trustee shall authenticate and deliver, in exchange for any
such mutilated Security or in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and Contingent Principal Amount, 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, or is about to be purchased by the
Company pursuant to Article 3 hereof, the Company in its discretion may, instead
of issuing a new Security, pay or purchase such Security, as the case may be.
Upon the issuance of any new Securities under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) in connection therewith.
Every new Security issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all benefits of this Indenture equally and proportionately with any
and all other Securities duly issued hereunder.
12
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
Section 2.08. Outstanding Securities; Determinations of Holders' Action.
----------------------------------------------------------
Securities outstanding at any time are all the Securities authenticated by the
Trustee except for those cancelled by it, those delivered to it for
cancellation, mutilated, destroyed, lost or stolen Securities for which the
Trustee has authenticated and delivered a new Security in lieu therefor pursuant
to Section 2.07, those paid pursuant to Section 2.07, and those described in
this Section 2.08 as not outstanding. A Security does not cease to be
outstanding because the Company or an Affiliate thereof holds the Security;
provided, however, that in determining whether the Holders of the requisite
Principal Amount of Securities have given or concurred in any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities
beneficially owned by the Company or any other obligor upon the Securities or
any Affiliate of the Company or such other obligor, other than Securities
purchased in connection with the distribution or trading thereof, shall be
disregarded and deemed not to be outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which the
Trustee knows to be so owned shall be so disregarded. Subject to the foregoing,
only Securities outstanding at the time of such determination shall be
considered in any such determination (including, without limitation,
determinations pursuant to Articles 6 and 9).
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Trustee receives proof reasonably satisfactory to it that
the replaced Security is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture, on a
Redemption Date, or on the Business Day following a Purchase Date, or on the
Business Day following a Change in Control Purchase Date, or at Stated Maturity,
money or, if permitted by the terms hereof, securities sufficient to pay the
Securities payable on that date, then on and after that date such Securities
shall cease to be outstanding and the Contingent Principal Amount of the
Securities, will cease to increase, and contingent interest (if any) on such
Securities shall cease to accrue and all other rights of the Holder shall
terminate (other than the right to receive the applicable Redemption Price,
Purchase Price or Change in Control Purchase Price, as the case may be, upon
delivery of the Security in accordance with the terms of this Indenture);
provided, that if such Securities are to be redeemed, notice of such redemption
has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made.
If a Security is converted in accordance with Article 11, then from and
after the Conversion Date such Security shall cease to be outstanding and the
Contingent Principal Amount of the Securities, will cease to increase, and
contingent interest (if any) shall cease to accrue on such Security.
Section 2.09. Temporary Securities. Pending the preparation of definitive
--------------------
Securities, the Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive
13
Securities in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the Officers
executing such Securities may determine, as conclusively evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Company designated for such purpose pursuant to Section 2.03 or
4.05, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like Contingent Principal Amount
of definitive Securities of authorized denominations. Until so exchanged the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.
Section 2.10. Cancellation. All Securities surrendered for payment,
------------
redemption or purchase by the Company pursuant to Article 3, conversion pursuant
to Article 11, registration of transfer or exchange shall, if surrendered to any
person other than the Trustee, be delivered to the Trustee and shall be promptly
cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all Securities
so delivered shall be promptly cancelled by the Trustee. No Securities shall be
authenticated in lieu of or in exchange for any Securities cancelled as provided
in this Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of by the Trustee in accordance
with its standard procedures unless the Company directs by Company Order that
the Trustee deliver cancelled Securities to the Company.
Section 2.11. Global Securities.
-----------------
(a) Transfer and Exchange of Global Securities. A Global Security
------------------------------------------
deposited with the Depositary pursuant to Section 2.01 shall be transferred
to the beneficial owners thereof only if such transfer complies with
Section 2.06 and (i) the Depositary notifies the Company that it is
unwilling or unable to continue as depositary for such Global Security or
if at any time ceases to be a "clearing agency" registered under the
Exchange Act and a successor depositary is not appointed by the Company
within 60 days after such notice, or (ii) an Event of Default has occurred
and is continuing with respect to the Securities or (iii) the Company
executes and delivers to the Trustee a Company Order to the effect that the
global Securities shall be exchangeable. In any case, the Company will
promptly make available to the Trustee a reasonable supply of Securities in
definitive, fully registered form without interest coupons in accordance
with the provisions of this Article 2.
Any Global Security that is transferable to the beneficial owners
thereof pursuant to this Section 2.11 shall be surrendered by the
Depositary to the Trustee located in the Borough of Manhattan, The City of
New York, to be so transferred, in definitive form, in whole or from time
to time in part, in denominations of $1,000 Original Principal Amount and
integral multiples of $1,000 Original Principal Amount, without charge, and
the Trustee shall authenticate and deliver, upon such transfer of each
portion of such
14
Global Security, an equal aggregate Original Principal Amount of Securities
of authorized denominations. Any portion of a Global Security transferred
pursuant to this Section 2.11 shall be executed, authenticated and
delivered only in the denominations specified in the form of Security
attached as Exhibit A hereto and registered in such names as the Depositary
shall direct.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depositary or under the Global Security, and
the Depositary may be treated by the Company, the Trustee and any agent of
the Company or the Trustee as the absolute owner of such Global Security
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall (A) prevent the Company, the Trustee or any agent of the Company or
the Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or (B) impair, as between the
Depositary and its Agent Members, the operation of customary practices
governing the exercise of the rights of a holder of any Security.
Subject to the provisions of this Section 2.11(a), the Holder may
grant proxies and otherwise authorize any Person, including Agent Members
and Persons that may hold interests through Agent Members, to take any
action which a Holder is entitled to take under this Indenture or the
Securities.
(b) Transfer and Exchange of Securities. Subject to the provisions of
-----------------------------------
Section 2.11(a), when Securities are presented by a Holder to the Registrar
with a request:
(1) to register the transfer of the Securities; or
(2) to exchange such Securities for an equal Original Principal
Amount of Securities of other authorized denominations,
the Registrar shall register the transfer or make the exchange as requested;
provided, however, that the Securities presented or surrendered for register of
transfer or exchange shall be duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by such Xxxxxx's attorney, duly authorized in writing.
Section 2.12. CUSIP Numbers. The Company in issuing the Securities may use
-------------
"CUSIP" numbers (if then generally in use), and, if so, the Trustee shall use
"CUSIP" numbers in notices of redemption as a convenience to Holders; provided
that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Securities or as contained
in any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption shall
not be affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the CUSIP numbers.
ARTICLE III
REDEMPTION AND PURCHASES
15
Section 3.01. Right to Redeem; Notices to Trustee.
-----------------------------------
The Company, at its option, may redeem the Securities in accordance with
the provisions of paragraphs 6 and 8 of the Securities. If the Company elects to
redeem Securities pursuant to paragraph 6 of the Securities, it shall notify the
Trustee in writing of the Redemption Date, the Original Principal Amount of
Securities to be redeemed and the Redemption Price.
The Company shall give the notice to the Trustee provided for in this
Section 3.01 by a Company Order at least 60 days before the Redemption Date
(unless a shorter notice shall be satisfactory to the Trustee). If fewer than
all the Securities are to be redeemed, the record date relating to such
redemption shall be selected by the Company and given to the Trustee, which
record date shall not be less than ten days after the date of notice to the
Trustee.
Section 3.02. Selection of Securities to Be Redeemed.
--------------------------------------
If less than all the Securities are to be redeemed, the Trustee shall
select the Securities to be redeemed pro rata based on ownership thereof or by
lot or by any other method the Trustee considers fair and appropriate (so long
as such method is not prohibited by the rules of any stock exchange on which the
Securities are then listed). The Trustee shall make the selection at least 30
days but not more than 60 days before the Redemption Date from outstanding
Securities not previously called for redemption. The Trustee may select for
redemption portions of the Original Principal Amount of Securities that have
denominations larger than $1,000.
Securities and any portions thereof that the Trustee selects shall be in
Original Principal Amounts of $1,000 or an integral multiple of $1,000.
Provisions of this Indenture that apply to Securities called for redemption also
apply to portions of Securities called for redemption. The Trustee shall notify
the Company promptly of the Securities or portions of Securities to be redeemed.
If any Security selected for partial redemption is converted in part before
termination of the conversion right with respect to the portion of the Security
so selected, the converted portion of such Security shall be deemed (so far as
may be) to be the portion selected for redemption. Securities which have been
converted during a selection of Securities to be redeemed may be treated by the
Trustee as outstanding for the purpose of such selection.
Nothing in this Section 3.02 shall affect the right of any Holder to
convert any Security pursuant to Article 11 before the termination of the
conversion right with respect thereto.
Section 3.03. Notice of Redemption.
--------------------
At least 30 days but not more than 60 days before a Redemption Date, the
Company shall give notice of redemption to each Holder of Securities to be
redeemed in the manner provided in Section 13.02.
The notice shall identify the Securities to be redeemed and shall state:
(a) the Redemption Date;
16
(b) the Redemption Price;
(c) the Conversion Rate;
(d) the name and address of the Paying Agent and Conversion Agent
and of the office or agency referred to in Section 4.05;
(e) that Securities called for redemption may be converted at any
time before the close of business on the second Business Day
immediately preceding the Redemption Date, even if not otherwise
convertible at such time;
(f) that Holders who want to convert Securities must satisfy the
requirements set forth in paragraph 9 of the Securities;
(g) that Securities called for redemption must be surrendered to
the Paying Agent or at the office or agency referred to in Section
4.05 to collect the Redemption Price;
(h) if fewer than all the outstanding Securities are to be
redeemed, the certificate numbers and Original Principal Amounts of
the particular Securities to be redeemed;
(i) that, unless the Company defaults in making payment of such
Redemption Price on Securities called for redemption, the Contingent
Principal Amount will cease to increase and contingent interest (if
any) will cease to accrue on and after the Redemption Date; and
(j) the CUSIP number of the Securities.
At the Company's request, the Trustee shall give the notice of redemption
in the Company's name and at the Company's expense, provided that the Company
makes such request at least 15 days (unless a shorter period shall be acceptable
to the Trustee) prior to the date such notice of redemption must be mailed.
Section 3.04. Effect of Notice of Redemption. Once notice of redemption is
------------------------------
given, Securities called for redemption become due and payable on the Redemption
Date and at the Redemption Price stated in the notice except for Securities
which are converted in accordance with the terms of this Indenture. Upon
surrender to the Paying Agent, such Securities shall be paid at the Redemption
Xxxxx stated in the notice.
17
Section 3.05. Deposit of Redemption Price. Prior to 10:00 a.m. (New York
---------------------------
City time), on the Redemption Date, the Company shall deposit with the Paying
Agent (or if the Company or a Subsidiary of the Company or an Affiliate of any
of them is the Paying Agent, shall segregate and hold in trust) money sufficient
to pay the Redemption Price of all Securities to be redeemed on that date other
than Securities or portions of Securities called for redemption which on or
prior thereto have been delivered by the Company to the Trustee for cancellation
or have been converted. The Paying Agent shall as promptly as practicable return
to the Company any money not required for that purpose because of conversion of
Securities pursuant to Article 11. If such money is then held by the Company or
a Subsidiary or an Affiliate of the Company in trust and is not required for
such purpose it shall be discharged from such trust.
Section 3.06. Securities Redeemed in Part. Upon surrender of a Security
---------------------------
that is redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Security in an authorized
denomination equal in Original Principal Amount to the unredeemed portion of the
Security surrendered.
Section 3.07. [Reserved].
----------
Section 3.08. Purchase of Securities at the Option of the Holder. (a)
--------------------------------------------------
General. If a Holder exercises its right to require the Company to repurchase
the Securities, the Securities shall be purchased by the Company on the
applicable Purchase Date, at a purchase price equal to the Contingent Principal
Amount of the Securities on the applicable Purchase Date, at the option of the
Holder thereof, upon:
(1) delivery to the Paying Agent, by the Holder, of a written notice
of purchase (a "Purchase Notice") at any time from the opening of business
on the date that is at least 20 Business Days prior to a Purchase Date
until the close of business on the Business Day immediately preceding such
Purchase Date stating:
(A) the certificate number of the Security which the Holder will
deliver to be purchased,
(B) the portion of the Original Principal Amount of the Security
which the Holder will deliver to be purchased, which portion must be
an Original Principal Amount of $1,000 or an integral multiple
thereof,
(C) that such Security shall be purchased as of the Purchase Date
pursuant to the terms and conditions specified in the Securities, and
(D) in the event the Company elects, pursuant to Section 3.08(b),
to pay the Purchase Price to be paid as of such Purchase Date, in
whole or in part, in shares of Common Stock but such portion of the
Purchase Price shall ultimately be payable to such Holder entirely in
cash because any of the conditions to payment of the Purchase Price
(or a portion thereof) in Common Stock is not satisfied prior to the
close of business on such Purchase Date, as set forth in Section
3.08(d), whether such Holder elects (i) to withdraw such Purchase
Notice as to some or all of the Securities to which such Purchase
Notice relates (stating the Original Principal Amount and certificate
numbers of the Securities as to
18
which such withdrawal shall relate), or (ii) to receive cash in
respect of the entire Purchase Price for all Securities (or portions
thereof) to which such Purchase Notice relates; and
(2) delivery of such Security to the Paying Agent prior to, on or
after the Purchase Date (together with all necessary endorsements) at the
offices of the Paying Agent, such delivery being a condition to receipt by
the Holder of the Purchase Price therefor; provided, however, that such
Purchase Price shall be so paid pursuant to this Section 3.08 only if the
Security so delivered to the Paying Agent shall conform in all respects to
the description thereof in the related Purchase Notice, as determined by
the Company.
If a Holder, in such Xxxxxx's Purchase Notice and in any written notice of
withdrawal delivered by such Holder pursuant to the terms of Section 3.10, fails
to indicate such Xxxxxx's choice with respect to the election set forth in
clause (D) of Section 3.08(a)(1), such Holder shall be deemed to have elected to
receive cash in respect of the Purchase Price for all Securities subject to such
Purchase Notice in the circumstances set forth in such clause (D).
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.08, a portion of a Security if the Original Principal Amount of such
portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of this
Section 3.08 shall be consummated by the delivery of the consideration to be
received by the Holder as promptly as practicable following the later of the
Purchase Date and the time of delivery of the Security.
Notwithstanding anything herein to the contrary, any Holder delivering to
the Paying Agent or the office or agency referred to in Section 4.05 the
Purchase Notice contemplated by this Section 3.08(a) shall have the right to
withdraw such Purchase Notice at any time prior to the close of business on the
Purchase Date by delivery of a written notice of withdrawal to the Paying Agent
in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by it of
any Purchase Notice or written notice of withdrawal thereof.
(b) Company's Right to Elect Manner of Payment of Purchase Price.
The Securities to be purchased pursuant to Section 3.08(a) may be paid for,
at the election of the Company, in cash or Common Stock, or in any
combination of cash and Common Stock, subject to the conditions set forth
in Sections 3.08(c) and (d). The Company shall designate, in the Company
Notice delivered pursuant to Section 3.08(e), whether the Company will
purchase the Securities for cash or Common Stock, or, if a combination
thereof, the percentages of the Purchase Price of Securities in respect of
which it will pay in cash or Common Stock; provided that the Company will
pay cash for fractional interests in Common Stock. For purposes of
determining the existence of potential fractional interests, all Securities
subject to purchase by the Company held by a Holder shall be considered
together (no matter how many separate certificates are to be
19
presented). Each Holder whose Securities are purchased pursuant to
this Section 3.08 shall receive the same percentage of cash or Common
Stock in payment of the Purchase Price for such Securities, except (i)
as provided in Section 3.08(d) with regard to the payment of cash in
lieu of fractional shares of Common Stock and (ii) in the event that
the Company is unable to purchase the Securities of a Holder or
Holders for Common Stock because any of the conditions specified in
Section 3.08(d) have not been satisfied, the Company may purchase the
Securities of such Holder or Holders for cash. The Company may not
change its election with respect to the consideration (or components
or percentages of components thereof) to be paid once the Company has
given its Company Notice to Securityholders except pursuant to this
Section 3.08(b) or pursuant to Section 3.08(d) in the event of a
failure to satisfy, prior to the close of business on the Purchase
Date, any condition to the payment of the Purchase Price, in whole or
in part, in Common Stock.
At least three Business Days before the Company Notice Date, the Company
shall deliver an Officers' Certificate to the Trustee specifying:
(i) the manner of payment selected by the Company,
(ii) the information required by Section 3.08(e),
(iii) if the Company elects to pay the Purchase Price, or a
specified percentage thereof, in Common Stock, that the
conditions to such manner of payment set forth in Section 3.08(d)
have been or will be complied with, and
(iv) whether the Company desires the Trustee to give the
Company Notice required by Section 3.08(e).
(c) Purchase with Cash. On each Purchase Date, at the option of the
------------------
Company, the Purchase Price of Securities in respect of which a Purchase
Notice pursuant to Section 3.08(a) has been given, or a specified
percentage thereof, may be paid by the Company with cash equal to the
aggregate Purchase Price of such Securities.
(d) Payment by Issuance of Common Stock. On each Purchase Date, at the
-----------------------------------
option of the Company, the Purchase Price of Securities in respect of which
a Purchase Notice pursuant to Section 3.08(a) has been given, or a
specified percentage thereof, may be paid by the Company by the issuance of
a number of shares of Common Stock equal to the quotient obtained by
dividing (i) the amount of cash to which the Securityholders would have
been entitled had the Company elected to pay all or such specified
percentage, as the case may be, of the Purchase Price of such Securities in
cash by (ii) the Market Price of a share of Common Stock, subject to the
next succeeding paragraph.
The Company will not issue a fractional share of Common Stock in payment of
the Purchase Price. Instead the Company will pay cash for the current market
value of the fractional share. The current market value of a fraction of a share
shall be determined by multiplying the Market Price by such fraction and
rounding the product to the nearest whole cent. It is
20
understood that if a Holder elects to have more than one Security purchased, the
number of shares of Common Stock shall be based on the aggregate amount of
Securities to be purchased.
Upon a payment by Common Stock pursuant to the terms hereof, the Original
Principal Amount and increases in the Contingent Principal Amount and accrued
Tax Original Issue Discount attributable to the period from the Issue Date to
the Purchase Date with respect to the purchased Security shall not be cancelled,
extinguished or forfeited but rather shall be deemed paid in full to the Holder
through the delivery of the Common Stock in exchange for the Security being
purchased pursuant to the terms hereof, and the fair market value of such Common
Stock (together with any cash payments in lieu of fractional shares of Common
Stock) shall be treated as issued, to the extent thereof, first in exchange for
increases in the Contingent Principal Amount and Tax Original Issue Discount
accrued through the Purchase Date, and the balance, if any, of the fair market
value of such shares of Common Stock shall be treated as issued in exchange for
the Issue Price of the Security being purchased pursuant to the provisions
hereof. If the Company elects to purchase the Securities by the issuance of
shares of Common Stock, the Company Notice, as provided in Section 3.08(e),
shall be sent to the Holders (and to beneficial owners as required by applicable
law) not later than the Company Notice Date.
The Company's right to exercise its election to purchase the Securities
pursuant to Section 3.08 through the issuance of shares of Common Stock shall be
conditioned upon:
(1) the Company's not having given a Company Notice stating its
election to pay entirely in cash for the Securities and its giving of
timely Company Notice of election to purchase all or a specified percentage
of the Securities with Common Stock as provided herein;
(2) the shares of Common Stock having been admitted for listing or
admitted for listing subject to notice of issuance on the principal United
States securities exchange on which the Common Stock is then listed or, if
the Common Stock is not then listed on a national or regional securities
exchange, admitted for quotation on the National Association of Securities
Dealers Automated Quotation System;
(3) the registration of the shares of Common Stock to be issued in
respect of the payment of the Purchase Price under the Securities Act of
1933, as amended (the "Securities Act"), and the Securities Exchange Act of
1934, as amended (the "Exchange Act"), in each case, if required;
(4) any necessary qualification or registration of the Common Stock
under applicable state securities laws or the availability of an exemption
from such qualification and registration; and
(5) the receipt by the Trustee of an Officers' Certificate and an
Opinion of Counsel each stating that (A) the terms of the issuance of the
Common Stock are in conformity with this Indenture and (B) the shares of
Common Stock to be issued by the Company in payment of the Purchase Price
in respect of Securities have been duly authorized and, when issued and
delivered pursuant to the terms of this Indenture in payment of the
Purchase Price in respect of the Securities, will be validly issued, fully
paid and nonassessable and shall be free of any preemptive rights and any
lien or adverse
21
claim (provided that such Opinion of Counsel may state that, insofar as it
relates to the absence of such preemptive rights, liens and adverse claims,
it is given upon the best knowledge of such counsel), and, in the case of
such Officers' Certificate, stating that conditions (1), (2), (3) and (4)
above and the condition set forth in the second succeeding sentence have
been satisfied and, in the case of such Opinion of Counsel, stating that
conditions (2), (3) and (4) above have been satisfied.
Such Officers' Certificate shall also set forth the number of shares of
Common Stock to be issued for each $1,000 Original Principal Amount of
Securities and the Sale Price of a share of Common Stock on each Trading Day
during the period for which the Market Price is calculated. The Company may pay
the Purchase Price (or any portion thereof) in Common Stock only if the
information necessary to calculate the Market Price is published in a daily
newspaper of national circulation or by other appropriate means. If the
foregoing conditions are not satisfied with respect to a Holder or Holders prior
to the close of business on the Purchase Date and the Company has elected to
purchase the Securities pursuant to this Section 3.08 through the issuance of
shares of Common Stock, the Company shall pay the entire Purchase Price of the
Securities of such Holder or Holders in cash.
(e) Notice of Election. The Company's notice of election to purchase
with cash or Common Stock or any combination thereof shall be sent to the
Holders (and to beneficial owners as required by applicable law) in the
manner provided in Section 13.02 (the "Company Notice"). The Company Notice
shall be sent to the Holders (and to beneficial owners as required by
applicable law) not less than 20 Business Days prior to the applicable
Purchase Date (the "Company Notice Date"). Such Company Notice shall state
the manner of payment elected and shall contain the following information:
In the event the Company has elected to pay the Purchase Price (or a
specified percentage thereof) with Common Stock, the Company Notice shall:
(1) state that each Holder will receive Common Stock with a
Market Price determined as of a specified date prior to the
Purchase Date equal to such specified percentage of the Purchase
Price of the Securities held by such Holder (except any cash
amount to be paid in lieu of fractional shares);
(2) set forth the method of calculating the Market Price of the
Common Stock; and
(3) state that because the Market Price of Common Stock will be
determined prior to the Purchase Date, Holders will bear the
market risk with respect to the value of the Common Stock to be
received from the date such Market Price is determined to the
Purchase Date.
In any case, each Company Notice shall include a form of Purchase Notice to
be completed by a Securityholder that wishes to exercise its option to have the
Company repurchase the Securities and shall state:
(i) the Purchase Price, the Conversion Rate and, to the extent
known at the time of such notice, the amount of contingent interest,
if any,
22
that will be accrued and payable with respect to the Securities as of
the Purchase Date;
(ii) whether the Company will pay the Purchase Price in cash or
in Common Stock or any combination thereof, specifying the percentage
of each;
(iii) the name and address of the Paying Agent and the Conversion
Agent and of the office or agency referred to in Section 4.05;
(iv) that Securities as to which a Purchase Notice has been given
may be converted pursuant to Article 11 hereof only if any applicable
Purchase Notice has been withdrawn in accordance with the terms of
this Indenture;
(v) that Securities must be surrendered to the Paying Agent or to
the office or agency referred to in Section 4.05 to collect payment of
the Purchase Price;
(vi) that the Purchase Price for any Security as to which a
Purchase Notice has been given and not withdrawn will be paid as
promptly as practicable following the later of the Purchase Date and
the time of surrender of such Security as described in (v);
(vii) the procedures the Holder must follow to exercise rights
under Section 3.08 and a brief description of those rights;
(viii) briefly, the conversion rights of the Securities and that
Holders who want to convert Securities must satisfy the requirements
set forth in paragraph 9 of the Securities;
(ix) the procedures for withdrawing a Purchase Notice (including,
without limitation, for a conditional withdrawal pursuant to the terms
of Section 3.08(a)(1)(D) or Section 3.10);
(x) that, unless the Company defaults in making payment of such
Purchase Price on Securities surrendered for purchase, the Contingent
Principal Amount will cease to increase and contingent interest, if
any, will cease to accrue on and after the Purchase Date; and
(xi) the CUSIP number of the Securities.
At the Company's request and upon being provided with a copy of such
Company Notice, the Trustee shall give such Company Notice in the Company's name
and at the Company's expense, provided that the Company makes such request at
least 15 days (unless a shorter period shall be acceptable to the Trustee) prior
to the date such Company Notice must be mailed; and provided, further, that, in
all cases, the text of such Company Notice shall be prepared by the Company.
23
Upon determination of the actual number of shares of Common Stock to be
issued for each $1,000 Original Principal Amount of Securities, the Company will
issue a press release and publish such determination on the Company's web site
or, at the Company's option, otherwise publicly disclose such information.
(f) Covenants of the Company. All shares of Common Stock delivered
------------------------
upon purchase of the Securities shall be newly issued shares or treasury
shares, shall be duly authorized, validly issued, fully paid and
nonassessable and shall be free from preemptive rights and free of any lien
or adverse claim, and the Common Stock will be entitled to the benefits of
the Amended and Restated Rights Agreement adopted December 2, 1997 equally
with other shares of Common Stock.
The Company shall use its reasonable efforts to list or cause to have
quoted any shares of Common Stock to be issued to purchase Securities on
the principal United States securities exchange or over-the-counter or
other domestic market on which any other shares of the Common Stock are
then listed or quoted. The Company will promptly inform the Trustee in
writing of any such listing.
(g) Procedure upon Purchase. On or before the Purchase Date, the
-----------------------
Company shall deposit cash (in respect of a cash purchase under Section
3.08(c) or for fractional interests, as applicable) or shares of Common
Stock, or a combination thereof, as applicable, at the time and in the
manner as provided in Section 3.11, sufficient to pay the aggregate
Purchase Price of all Securities to be purchased pursuant to this Section
3.08. As soon as practicable after the Purchase Date, the Company shall
deliver to each Holder entitled to receive Common Stock through the Paying
Agent, a certificate for the number of full shares of Common Stock issuable
in payment of the Purchase Price and cash in lieu of any fractional
interests. The person in whose name the certificate for Common Stock is
registered shall be treated as a holder of record of shares of Common Stock
on the Business Day following the Purchase Date. Subject to Section
3.08(d), no payment or adjustment will be made for dividends on the Common
Stock the record date for which occurred on or prior to the Purchase Date.
(h) Taxes. If a Holder of a Security is paid in Common Stock, the
-----
Company shall pay any documentary, stamp or similar issue or transfer tax
due on such issue of shares of Common Stock. However, the Holder shall pay
any such tax which is due because the Holder requests the shares of Common
Stock to be issued in a name other than the Holder's name. The Paying Agent
may refuse to deliver the certificates representing the Common Stock being
issued in a name other than the Holder's name until the Paying Agent
receives a sum sufficient to pay any tax which will be due because the
shares of Common Stock are to be issued in a name other than the Holder's
name. Nothing herein shall preclude the Company from withholding or
directing the withholding of any tax required by law or regulations.
24
Section 3.09. Purchase of Securities at Option of the Holder upon Change in
-------------------------------------------------------------
Control.
-------
(a) If on or prior to March 13, 2007 there shall have occurred a
Change in Control, Securities shall be purchased by the Company, at the
option of the Holder thereof, at a purchase price specified in paragraph 7
of the Securities (the "Change in Control Purchase Price"), as of the date
that is no later than 35 Business Days after the occurrence of the Change
in Control (the "Change in Control Purchase Date"), subject to satisfaction
by or on behalf of the Holder of the requirements set forth in Section
3.09(c).
A "Change in Control" shall be deemed to have occurred at such time as
either of the following events shall occur:
(1) any person, including any Affiliate or Associate of the
Company, other than the Company, its Subsidiaries, or their employee
benefit plans, files a Schedule 13D or Schedule TO (or any successor
schedule, form or report under the Exchange Act) disclosing that such
person has become the beneficial owner of 50% or more of the aggregate
voting power of the Common Stock and other capital stock with equivalent
voting rights, or other capital stock into which the Common Stock is
reclassified or changed, provided, however, that a person shall not be
deemed a beneficial owner of, or to own beneficially, (A) any securities
tendered pursuant to a tender or exchange offer made by or on behalf of
such person or any of such person's Affiliates or Associates until such
tendered securities are accepted for purchase or exchange thereunder, or
(B) any securities if such beneficial ownership (1) arises solely as a
result of a revocable proxy delivered in response to a proxy or consent
solicitation made pursuant to the applicable rules and regulations under
the Exchange Act, and (2) is not also then reportable on Schedule 13D (or
any successor schedule) under the Exchange Act; or
(2) there shall be consummated any share exchange,
consolidation or merger of the Company pursuant to which the Common Stock
would be converted into cash, securities or other property in which the
holders of the Common Stock and other capital stock with equivalent voting
rights immediately prior to such share exchange, consolidation or merger,
have, directly or indirectly, less than a majority of the total voting
power in the aggregate of all classes of capital stock of the continuing
and surviving corporation immediately after such share exchange,
consolidation or merger of the Company.
Notwithstanding the foregoing provisions of this Section 3.09, a Change in
Control shall not be deemed to have occurred by virtue of the Company, any
Subsidiary, any employee stock ownership plan or any other employee benefit plan
of the Company or any Subsidiary, or any person holding Common Stock for or
pursuant to the terms of any such employee benefit plan, filing or becoming
obligated to file a report under or in response to Schedule 13D or Schedule TO
(or any successor schedule, form or report) under the Exchange Act disclosing
beneficial ownership by it of shares of Common Stock, whether in excess of 50%
or otherwise.
"Associate" shall have the meaning ascribed to such term in Rule 12b-2 of
the General Rules and Regulations under the Exchange Act, as in effect on the
date hereof.
25
(b) Within 15 Business Days after the occurrence of a Change in
Control, the Company shall mail a written notice of Change in Control by
first-class mail to the Trustee and to each Holder (and to beneficial
owners as required by applicable law). The notice shall include a form of
Change in Control Purchase Notice to be completed by the Securityholder
and shall state:
(1) briefly, the events causing a Change in Control and the
date of such Change in Control;
(2) the date by which the Change in Control Purchase Notice
pursuant to this Section 3.09 must be given;
(3) the Change in Control Purchase Date;
(4) the Change in Control Purchase Price;
(5) the name and address of the Paying Agent and the
Conversion Agent and of the office or agency referred to in Section
4.05;
(6) the Conversion Rate and any adjustments thereto;
(7) that Securities as to which a Change in Control Purchase
Notice is given by the Holder may be converted, if otherwise
convertible, only if the Change in Control Purchase Notice has been
withdrawn in accordance with the terms of this Indenture;
(8) that Securities must be surrendered to the Paying Agent
or the office or agency referred to in Section 4.05 to collect
payment of the Change in Control Purchase Price;
(9) that the Change in Control Purchase Price for any
Security as to which a Change in Control Purchase Notice has been
duly given and not withdrawn will be paid as promptly as
practicable following the later of the Change in Control Purchase
Date and the time of surrender of such Security as described in
clause (8), above;
(10) the procedures the Holder must follow to exercise rights
under this Section 3.09 and a brief description of those rights;
(11) briefly, the conversion rights of the Securities
(including whether the Securities are then currently convertible);
(12) the procedures for withdrawing a Change in Control
Purchase Notice;
(13) that, unless the Company defaults in making payment of
such Change in Control Purchase Price on Securities surrendered for
purchase, the Contingent Principal Amount will cease to increase
and contingent interest, if any, will cease to accrue on and after
the Change in Control Purchase Date; and
26
(14) the CUSIP number of the Securities.
(c) A Holder may exercise its rights specified in Section 3.09(a) upon
delivery of a written notice of purchase (a "Change in Control Purchase Notice")
to the Paying Agent or to the office or agency referred to in Section 4.05 at
any time prior to the close of business on the Change in Control Purchase Date,
stating:
(1) the certificate number of the Security which the Holder will
deliver to be purchased;
(2) the portion of the Original Principal Amount of the Securities
which the Holder will deliver to be purchased, which portion must be $1,000 or
an integral multiple thereof; and
(3) that such Security shall be purchased pursuant to the terms
and conditions specified in the Securities.
The delivery of such Security to the Paying Agent prior to, on or after the
Change in Control Purchase Date (together with all necessary endorsements) at
the offices of the Paying Agent or to the office or agency referred to in
Section 4.05 shall be a condition to the receipt by the Holder of the Change in
Control Purchase Price therefor; provided, however, that such Change in Control
Purchase Price shall be so paid pursuant to this Section 3.09 only if the
Security so delivered to the Paying Agent or such office or agency shall conform
in all respects to the description thereof set forth in the related Change in
Control Purchase Notice and such Change in Control Purchase Notice shall not be
validly withdrawn by the Holder.
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.09, a portion of a Security if the Original Principal Amount of such
portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of this
Section 3.09 shall be consummated by the delivery of the consideration to be
received by the Holder as promptly as practicable following the later of the
Change in Control Purchase Date and the time of delivery of the Security to the
Paying Agent or to the office or agency referred to in Section 4.05 in
accordance with this Section 3.09.
Notwithstanding anything herein to the contrary, any Holder delivering to
the Paying Agent or to the office or agency referred to in Section 4.05 the
Change in Control Purchase Notice contemplated by this Section 3.09(c) shall
have the right to withdraw such Change in Control Purchase Notice at any time
prior to the close of business on the Change in Control Purchase Date by
delivery of a written notice of withdrawal to the Paying Agent or to the office
or agency referred to in Section 4.05 in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by it of
any Change in Control Purchase Notice or written withdrawal thereof.
27
Section 3.10. Effect of Purchase Notice or Change in Control Purchase
-------------------------------------------------------
Notice. Upon receipt by the Paying Agent of the Purchase Notice or Change in
------
Control Purchase Notice specified in Section 3.08(a) or Section 3.09(c), as
applicable, the Holder of the Security in respect of which such Purchase Notice
or Change in Control Purchase Notice, as the case may be, was given shall
(unless such Purchase Notice or Change in Control Purchase Notice is withdrawn
as specified in the following two paragraphs) thereafter be entitled to receive
solely the Purchase Price or Change in Control Purchase Price, as the case may
be, with respect to such Security to the Purchase Date or Change in Control
Purchase Date, as the case may be. Such Purchase Price or Change in Control
Purchase Price shall be paid to such Holder, subject to receipts of funds and/or
Common Stock by the Paying Agent, as promptly as practicable following the later
of (x) the Purchase Date or the Change in Control Purchase Date, as the case may
be, with respect to such Security (provided the conditions in Section 3.08(a) or
Section 3.09(c), as applicable, have been satisfied) and (y) the time of
delivery of such Security to the Paying Agent by the Holder thereof in the
manner required by Section 3.08(a) or Section 3.09(c), as applicable. Securities
in respect of which a Purchase Notice or Change in Control Purchase Notice, as
the case may be, has been given by the Holder thereof may not be converted
pursuant to Article 11 hereof on or after the date of the delivery of such
Purchase Notice or Change in Control Purchase Notice, as the case may be, unless
such Purchase Notice or Change in Control Purchase Notice, as the case may be,
has first been validly withdrawn as specified in the following two paragraphs.
A Purchase Notice or Change in Control Purchase Notice, as the case may be,
may be withdrawn by means of a written notice of withdrawal delivered to the
office of the Paying Agent or to the office or agency referred to in Section
4.05 in accordance with the Purchase Notice or Change in Control Purchase
Notice, as the case may be, at any time prior to the close of business on the
Purchase Date or the Change in Control Purchase Date, as the case may be,
specifying:
(1) the Original Principal Amount of the Securities with respect
to which such notice of withdrawal is being submitted,
(2) the certificate number of the Securities in respect of which
such notice of withdrawal is being submitted, and
(3) the Original Principal Amount, if any, of any such
Securities which remain subject to the original Purchase Notice or
Change in Control Purchase Notice, as the case may be, and which has
been or will be delivered for purchase by the Company.
A written notice of withdrawal of a Purchase Notice may be in the form set
forth in the preceding paragraph or may be in the form of (i) a conditional
withdrawal contained in a Purchase Notice pursuant to the terms of Section
3.08(a)(1)(D) or (ii) a conditional withdrawal containing the information set
forth in Section 3.08(a)(1)(D) and the preceding paragraph and contained in a
written notice of withdrawal delivered to the Paying Agent as set forth in the
preceding paragraph.
There shall be no purchase of any Securities pursuant to Section 3.08
(other than through the issuance of Common Stock in payment of the Purchase
Price, including cash in lieu of
28
fractional shares) or 3.09 if there has occurred (prior to, on or after, as the
case may be, the giving, by the Holders of such Securities, of the required
Purchase Notice or Change in Control Purchase Notice, as the case may be) and is
continuing an Event of Default (other than a default in the payment of the
Purchase Price or Change in Control Purchase Price, as the case may be, with
respect to such Securities). The Paying Agent will promptly return to the
respective Holders thereof any Securities (x) with respect to which a Purchase
Notice or Change in Control Purchase Notice, as the case may be, has been
withdrawn in compliance with this Indenture, or (y) held by it during the
continuance of an Event of Default (other than a default in the payment of the
Purchase Price or Change in Control Purchase Price, as the case may be, with
respect to such Securities) in which case, upon such return, the Purchase Notice
or Change in Control Purchase Notice with respect thereto shall be deemed to
have been withdrawn.
Section 3.11. Deposit of Purchase Price or Change in Control Purchase
-------------------------------------------------------
Price. Prior to 10:00 a.m. New York City time on the Business Day following the
-----
Purchase Date or the Change in Control Purchase Date, as the case may be, the
Company shall deposit with the Trustee or with the Paying Agent (or, if the
Company or a Subsidiary or an Affiliate of either of them is acting as the
Paying Agent, shall segregate and hold in trust as provided in Section 2.04) an
amount of money (in immediately available funds if deposited on such Business
Day) or Common Stock, if permitted hereunder, sufficient to pay the aggregate
Purchase Price or Change in Control Purchase Price, as the case may be, of all
the Securities or portions thereof which are to be purchased as of the Purchase
Date or Change in Control Purchase Date, as the case may be. After the Purchase
Date or the Change in Control Purchase Date, the Contingent Principal Amount
shall cease to increase, Tax Original Issue Discount, and contingent interest,
if any, shall cease to accrue on such Security, whether or not such Security is
delivered to the Paying Agent.
Section 3.12. Securities Purchased in Part. Any Security which is to be
----------------------------
purchased only in part shall be surrendered at the office of the Paying Agent or
to the office or agency referred to in Section 4.05 (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 such Holder's attorney duly authorized in writing) and the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Security, without service charge, a new Security or Securities, of any
authorized denomination as requested by such Holder in aggregate Original
Principal Amount equal to, and in exchange for, the portion of the Original
Principal Amount of the Security so surrendered which is not purchased.
Section 3.13. Covenant to Comply With Securities Laws Upon Purchase of
--------------------------------------------------------
Securities. In connection with any offer to purchase or purchase of Securities
----------
under Section 3.08 or 3.09 hereof (provided that such offer or purchase
constitutes an "issuer tender offer" for purposes of Rule 13e-4 (which term, as
used herein, includes any successor provision thereto) under the Exchange Act at
the time of such offer or purchase), the Company shall (i) comply with Rule
13e-4 and Rule 14e-1 under the Exchange Act and any other then applicable tender
offer rules, (ii) file the related Schedule TO (or any successor schedule, form
or report) under the Exchange Act, and (iii) otherwise comply with all Federal
and state securities laws so as to permit the rights and obligations under
Sections 3.08 and 3.09 to be exercised in the time and in the manner specified
in Sections 3.08 and 3.09.
29
Section 3.14. Repayment to the Company. The Trustee and the Paying Agent
------------------------
shall return to the Company any cash or shares of Common Stock that remain
unclaimed as provided in paragraph 14 of the Securities, together with interest
or dividends, if any, thereon (subject to the provisions of Section 7.01(f)),
held by them for the payment of the Purchase Price or Change in Control Purchase
Price, as the case may be; provided, however, that to the extent that the
aggregate amount of cash or shares of Common Stock deposited by the Company
pursuant to Section 3.11 exceeds the aggregate Purchase Price or Change in
Control Purchase Price, as the case may be, of the Securities or portions
thereof which the Company is obligated to purchase as of the Purchase Date or
Change in Control Purchase Date, as the case may be, then as promptly as
practicable after the Business Day following the Purchase Date or Change in
Control Purchase Date, as the case may be, the Trustee shall return any such
excess to the Company together with interest or dividends, if any, thereon
(subject to the provisions of Section 7.01(f)).
Notwithstanding anything in this Indenture to the contrary, all moneys
delivered to the Trustee (in any capacity) for payment to Holders shall remain
uninvested unless otherwise agreed to in writing between the Company and the
Trustee.
ARTICLE IV
COVENANTS
Section 4.01. Payment of Securities. The Company shall promptly make all
---------------------
payments in respect of the Securities on the dates and in the manner provided in
the Securities or pursuant to this Indenture. Original Principal Amount,
Contingent Principal Amount, Tax Original Issue Discount, Redemption Price,
Purchase Price, Change in Control Purchase Price and contingent interest, if
any, shall be considered paid on the applicable date due if on such date the
Trustee or the Paying Agent holds, in accordance with this Indenture, cash or
securities, if expressly permitted hereunder, sufficient to pay all such amounts
then due.
The Company shall, to the extent permitted by law, pay interest on overdue
amounts at the per annum rate of interest set forth in paragraph 1 of the
Securities, compounded semi-annually, which interest on overdue amounts (to the
extent payment of such interest shall be legally enforceable) shall accrue from
the date such overdue amounts were originally due and payable.
Section 4.02. SEC Reports. The Company shall file with the Trustee, within
-----------
15 days after it files such annual and quarterly reports, information, documents
and other reports with the SEC, copies of its annual and quarterly reports and
of the information, documents and other reports (or copies of such portions of
any of the foregoing as the SEC may by rules and regulations prescribe) which
the Company is required to file with the SEC pursuant to Section 13 or 15(d) of
the Exchange Act (or any such successor provisions thereto). The Company also
shall comply with the other provisions of TIA Section 314(a), to the extent such
provisions are applicable.
Section 4.03. Compliance Certificate; Notice of Defaults.
------------------------------------------
(a) The Company shall deliver to the Trustee within 120 days after the
end of each fiscal year of the Company (beginning with the fiscal year
ending on December 31, 2001)
30
a certificate of the principal executive officer, the principal financial
officer or the principal accounting officer of the Company stating whether
or not, to the knowledge of the signer, the Company has complied with all
conditions and covenants on its part contained in this Indenture and, if
the signer has obtained knowledge of any default by the Company in the
performance, observance or fulfillment of any such condition or covenant,
specifying each such default and the nature thereof. For the purpose of
this Section 4.03, compliance shall be determined without regard to any
grace period or requirement of notice provided pursuant to the terms of
this Indenture.
(b) The Company shall file with the Trustee written notice of the
occurrence of any Default or Event of Default within five Business Days of
its becoming aware of such Default or Event of Default.
Section 4.04. Further Instruments and Acts. Upon request of the Trustee,
----------------------------
the Company will execute and deliver such further instruments and do such
further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
Section 4.05. Maintenance of Office or Agency. The Company will maintain in
-------------------------------
the Borough of Manhattan, The City of New York, in such location as may be
required by the rules of any securities exchange or quotation system on which
the Securities may from time to time be listed, an office or agency where
Securities may be presented or surrendered for payment, where Securities may be
surrendered for registration of transfer, exchange, purchase, redemption or
conversion and where notices and demands to or upon the Company in respect of
the Securities and this Indenture may be served. The office of the Trustee in
The City of New York, which office on the date hereof is located at 000 Xxxx
00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, shall be such office or agency for all of
the aforesaid purposes unless the Company shall maintain some other office or
agency for such purposes and shall give prompt written notice to the Trustee of
the location, and any change of location, of such other 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, such
presentations, surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 13.02.
The Company may also from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in The City of New
York, for such purposes.
Section 4.06. Calculation of Certain Amounts. (a) The Company shall file
------------------------------
with the Trustee, within 30 days following the end of each calendar year, a
written notice specifying (i) the amount of Tax Original Issue Discount
(including the daily rates and accrual periods) accrued on outstanding
Securities as of the end of such year and (ii) such other specific information
relating to such Tax Original Issue Discount as may then be relevant under the
Internal Revenue Code of 1986, as amended from time to time and (b) the Company,
promptly after each Yield Determination Date, shall file with the Trustee a
written notice specifying the Yield that will be applicable on the next
succeeding Yield Reset Date.
31
Section 4.07. Limitation Upon Creation of Liens on Voting Stock of Certain
------------------------------------------------------------
Subsidiaries.
------------
The Company will not, and it will not permit any subsidiary at any time
directly or indirectly to, create, assume, incur or permit to exist any
indebtedness for borrowed money secured by a pledge, lien or other encumbrance
(any pledge, lien or other encumbrance being hereinafter in this Section
referred to as a "lien") on the Voting Stock of any Subsidiary (other than a
Subsidiary which, at the time of incurrence of such secured indebtedness, has a
net worth, as determined in accordance with generally accepted accounting
principles, of less than $3,000,000) without making effective provision whereby
the outstanding securities (and, if the Company so elects, any other
indebtedness ranking on a parity with the Securities), shall be secured equally
and ratably with such secured indebtedness so long as such other indebtedness
shall be so secured; provided, however, that the foregoing covenant shall not be
applicable to liens for taxes or assessments or governmental charges or levies
not then due and delinquent or the validity of which is being contested in good
faith or which are less than $1,000,000 in amount, liens created by or resulting
from any litigation or legal proceeding which is currently being contested in
good faith by appropriate proceedings or which involve claims of less than
$1,000,000, or deposits to secure (or in lieu of) surety, stay, appeal or
customs bonds.
If the Company shall hereafter be required to secure the Securities equally
and ratably with any other indebtedness pursuant to this Section, (i) the
Company will promptly deliver to the Trustee an Officers' Certificate stating
that the foregoing covenant has been complied with, and an Opinion of Counsel
stating that in the opinion of such counsel the foregoing covenant has been
complied with and that any instruments executed by the Company or any Subsidiary
in the performance of the foregoing covenant comply with the requirements of the
foregoing covenant and (ii) the Trustee is hereby authorized to enter into an
indenture of agreement supplemental hereto and to take such action, if any, as
it may deem advisable to enable it to enforce the rights of the holders of the
Securities so secured.
Section 4.08. Limitation on Disposition of Voting Stock of, and Merger and
------------------------------------------------------------
Sale of Assets by, MLPF&S.
--------------------------
The Company will not:
(a) sell, transfer or otherwise dispose of any shares of Voting Stock
of MLPF&S or permit MLPF&S to issue, sell, or otherwise dispose of any
shares of its Voting Stock, unless, after giving effect to any such
transaction, MLPF&S remains a Controlled Subsidiary; or
(b) permit MLPF&S to
(1) merge or consolidate, unless the surviving company is a
Controlled Subsidiary; or
(2) convey or transfer its properties and assets substantially as
an entirety to any Person, except to one or more Controlled Subsidiaries.
Section 4.09. Waiver of Certain Covenants.
---------------------------
32
The Company may omit in any particular instance to comply with any term,
provision or condition set forth in Sections 4.07 or 4.08 with respect to the
Securities if before the time for such compliance the Holders of at least a
majority in principal amount of the Outstanding Securities shall by Act of such
Holders either waive such compliance in such instance or generally waive
compliance with such term, provision or condition, but no such waiver shall
extend to or affect such term, provision or condition except to the extent so
expressly waived, and, until such waiver shall become effective, the obligations
of the Company and the duties of the Trustee in respect of any such term,
provision or condition shall remain in full force and effect.
33
ARTICLE V
SUCCESSOR CORPORATION
Section 5.01. When Company May Merge or Transfer Assets. The Company may
-----------------------------------------
consolidate with, or sell, lease or convey all or substantially all of its
properties and assets to, or merge with or into any other Person, provided that
in any such case:
(a) either the Company shall be the continuing corporation or the
successor Person shall be a Person organized and existing under the laws of
the United States or any State thereof and such successor Person shall
expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of all amounts payable with respect to all the Securities,
according to their terms, and the due and punctual performance and
observance of all of the covenants, conditions and obligations to be
performed by the Company under the Securities and this Indenture; and
(b) immediately after giving effect to such merger or consolidation or
such sale, lease or conveyance, and the assumption contemplated above, the
Company or such successor Person shall not be in default in the performance
of any such covenant, condition or obligation.
In the case of any such consolidation, merger, sale, lease or conveyance
and upon any such assumption by the successor Person , such successor Person
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 Company herein; and thereafter, except in the case of a
lease of its properties and assets substantially as an entirety, the Company
shall be relieved of any further obligation under this Indenture and the
Securities. Such successor Person thereupon may cause to be signed, and may
issue either in its own name or in the name of the Company, any or all of the
Securities issuable hereunder which theretofore shall not have been signed by
the Company and delivered to the Trustee; and, upon the order of such successor
Person, 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 such successor Person 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 case of any such consolidation, merger, sale, lease or conveyance, such
changes in phraseology and form (but not in substance) may be made in the
Securities thereafter to be issued as may be appropriate.
The Trustee, subject to Section 7.01, may receive an Officers' Certificate
and an Opinion of Counsel as conclusive evidence that any such consolidation,
merger, sale, lease or conveyance, and any such assumption, complies with the
provisions of this Article.
34
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.01. Events of Default. An "Event of Default" means any one of the
-----------------
following events:
(a) a default in the payment of the Contingent Principal Amount,
Redemption Price, Purchase Price or Change in Control Purchase Price on any
Security when the same becomes due and payable pursuant to the terms
hereof;
(b) failure of the Company to make any payment of contingent interest
when the same becomes due and payable pursuant to the terms of Article 10
hereof for a period of 30 days;
(c) the Company fails to comply with any of its agreements in the
Securities or this Indenture (other than those referred to in clauses (a)
or (b) above) upon the receipt of notice of such default from the Trustee
or from Holders of not less than 25% in aggregate Original Principal Amount
of the Securities then outstanding and such failure (or the failure to
obtain a waiver thereof) continues for 60 days after receipt by the Company
of a Notice of Default;
(d) the Company pursuant to or under or within the meaning of any
Bankruptcy Law:
(1) commences a voluntary case or proceeding;
(2) consents to the entry of an order for relief against it in an
involuntary case or proceeding or the commencement of any case against it;
(3) consents to the appointment of a Custodian of it or for any
substantial part of its property;
(4) makes a general assignment for the benefit of its creditors;
(5) files a petition in bankruptcy or answer or consent seeking
reorganization or relief; or
(6) consents to the filing of such petition or the appointment of
or taking possession by a Custodian; or
(e) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(1) is for relief against the Company in an involuntary case or
proceeding, or adjudicates the Company insolvent or bankrupt;
35
(2) appoints a Custodian of the Company or for any substantial
part of its property; or
(3) orders the winding up or liquidation of the Company and the
order or decree remains unstayed and in effect for 60 days.
"Bankruptcy Law" means Title 11, United States Code, or any similar Federal
or state law for the relief of debtors.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or
similar official under any Bankruptcy Law.
Notwithstanding anything herein to the contrary, a Default is not an Event
of Default until the Trustee notifies the Company or the Holders of at least 25%
in aggregate Original Principal Amount of the Securities at the time outstanding
notify the Company and the Trustee, of the Default and the Company does not cure
such Default (and such Default is not waived) within the time specified in
clause (b) or clause (c) above after actual receipt of such notice. Any such
notice must specify the Default, demand that it be remedied and state that such
notice is a "Notice of Default".
The Company shall deliver to the Trustee, within five (5) days after it
becomes aware of the occurrence thereof, written notice of any event which with
the giving of notice or the lapse of time, or both, would become an Event of
Default under clause (b) or clause (c) above, its status and what action the
Company is taking or proposes to take with respect thereto.
Section 6.02. Acceleration. If an Event of Default (other than an Event of
------------
Default specified in Section 6.01(d) or (e)) occurs and is continuing, the
Trustee by Notice to the Company or the Holders of at least 25% in aggregate
Original Principal Amount of the Securities at the time outstanding by notice to
the Company and the Trustee, may declare the Contingent Principal Amount through
the date of such declaration, and any accrued and unpaid contingent interest
through the date of such declaration, on all the Securities to be immediately
due and payable. Upon such a declaration, such Contingent Principal Amount, and
such accrued and unpaid contingent interest, if any, shall be due and payable
immediately. If an Event of Default specified in Section 6.01(d) or (e) occurs
and is continuing, the Contingent Principal Amount, and any accrued and unpaid
contingent interest, on all the Securities to the date of the occurrence of such
Event of Default shall become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Securityholders. The
Holders of a majority in aggregate Original Principal Amount of the Securities
at the time outstanding, by notice to the Trustee (and without notice to any
other Securityholder) may rescind an acceleration and its consequences if the
rescission would not conflict with any judgment or decree and if all existing
Events of Default have been cured or waived except nonpayment of the Contingent
Principal Amount and any accrued and unpaid contingent interest that have become
due solely as a result of acceleration and if all amounts due to the Trustee
under Section 7.06 have been paid. No such rescission shall affect any
subsequent Default or impair any right consequent thereto.
Section 6.03. Other Remedies. If an Event of Default occurs and is
--------------
continuing, the Trustee may pursue any available remedy to collect the payment
of the Contingent Principal
36
Amount on the Securities or to enforce the performance of any provision of the
Securities or this Indenture.
The Trustee may maintain a proceeding even if the Trustee does not possess
any of the Securities or does not produce any of the Securities in the
proceeding. A delay or omission by the Trustee or any Securityholder in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of, or acquiescence in, the
Event of Default. No remedy is exclusive of any other remedy. All available
remedies are cumulative.
Section 6.04. Waiver of Past Defaults. The Holders of a majority in
-----------------------
aggregate Original Principal Amount of the Securities at the time outstanding,
by notice to the Trustee (and without notice to any other Securityholder), may
waive an existing Default and its consequences except (1) an Event of Default
described in Section 6.01(a), (2) a Default in respect of a provision that under
Section 9.02 cannot be amended without the consent of each Securityholder
affected or (3) a Default which constitutes a failure to convert any Security in
accordance with the terms of Article 11. When a Default is waived, it is deemed
cured, but no such waiver shall extend to any subsequent or other Default or
impair any consequent right. This Section 6.04 shall be in lieu of Section
316(a)1(B) of the TIA and such Section 316(a)1(B) is hereby expressly excluded
from this Indenture, as permitted by the TIA.
Section 6.05. Control by Majority. The Holders of a majority in aggregate
-------------------
Original Principal Amount of the Securities at the time outstanding may direct
the time, method and place of conducting any proceeding for any remedy available
to the Trustee or of exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that conflicts with law
or this Indenture or that the Trustee determines in good faith is unduly
prejudicial to the rights of other Securityholders or would involve the Trustee
in personal liability unless the Trustee is offered indemnity satisfactory to
it. This Section 6.05 shall be in lieu of Section 316(a)1(A) of the TIA and such
Section 316(a)1(A) is hereby expressly excluded from this Indenture, as
permitted by the TIA.
Section 6.06. Limitation on Suits. A Securityholder may not pursue any
---------------------
remedy with respect to this Indenture or the Securities unless:
(a) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(b) the Holders of at least 25% in aggregate Original Principal Amount
of the Securities at the time outstanding make a written request to the
Trustee to pursue the remedy;
(c) such Holder or Holders offer to the Trustee security or indemnity
satisfactory to the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of such notice, request and offer of security or indemnity; and
37
(e) the Holders of a majority in aggregate Original Principal Amount
of the Securities at the time outstanding do not give the Trustee a
direction inconsistent with the request during such 60-day period.
A Securityholder may not use this Indenture to prejudice the rights of any
other Securityholder or to obtain a preference or priority over any other
Securityholder.
Section 6.07. Rights of Holders to Receive Payment. Notwithstanding any
------------------------------------
other provision of this Indenture, the right of any Holder to receive payment of
the Contingent Principal Amount, Redemption Price, Purchase Price, Change in
Control Purchase Price or contingent interest, if any, in respect of the
Securities held by such Holder, on or after the respective due dates expressed
in the Securities or any Redemption Date, and to convert the Securities in
accordance with Article 11, or to bring suit for the enforcement of any such
payment on or after such respective dates or the right to convert, shall not be
impaired or affected adversely without the consent of such Holder.
Section 6.08. Collection Suit by Trustee. If an Event of Default described
--------------------------
in Section 6.01(a) or (b) occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust against the Company
for the whole amount owing with respect to the Securities and the amounts
provided for in Section 7.06.
Section 6.09. Trustee May File Proofs of Claim. In case of the pendency of
--------------------------------
any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Securities or the property of the
Company or of such other obligor or its creditors, the Trustee (irrespective of
whether the Contingent Principal Amount, Redemption Price, Purchase Price,
Change in Control Purchase Price or contingent interest, if any, in respect of
the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Trustee shall have made
any demand on the Company for the payment of any such amount) 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 Contingent
Principal Amount, Redemption Price, Purchase Price, Change in Control
Purchase Price or contingent interest, if any, and to file such other
papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel
or any other amounts due the Trustee under Section 7.06) and of the Holders
allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 7.06.
38
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities. If the Trustee collects any money pursuant to
----------
this Article 6, it shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.06;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for the Contingent Principal Amount, Redemption
Price, Purchase Price, Change in Control Purchase Price or
contingent interest, if any, as the case may be, ratably,
without preference or priority of any kind, according to such
amounts due and payable on the Securities; and
THIRD: the balance, if any, to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section 6.10. At least 15 days before such
record date, the Trustee shall mail to each Securityholder and the Company a
notice that states the record date, the payment date and the amount to be paid.
Section 6.11. Undertaking for Costs. In any suit for the enforcement of any
---------------------
right or remedy under this Indenture or in any suit against the Trustee for any
action taken or omitted by it as Trustee, a court in its discretion may require
the filing by any party litigant (other than the Trustee) in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees and expenses,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.07 or a suit by Holders of more than 10% in aggregate Original Principal
Amount of the Securities at the time outstanding. This Section 6.11 shall be in
lieu of Section 315(e) of the TIA and such Section 315(e) is hereby expressly
excluded from this Indenture, as permitted by the TIA.
Section 6.12. Waiver of Stay, Extension or 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 or extension law or any usury or other law
wherever enacted, now or at any time hereafter in force, which would prohibit or
forgive the Company from paying all or any portion of the Contingent Principal
Amount, Redemption Price, Purchase Price, Change in Control Purchase Price or
contingent interest, if any, delivering Common Stock upon a conversion pursuant
to Article 11 or paying the cash equivalent thereof, in respect of Securities,
or any interest on such amounts, as contemplated herein, or which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
39
ARTICLE VII
TRUSTEE
Section 7.01. Rights of Trustee.
-----------------
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper person and shall incur
no liability in its reliance thereon. The Trustee need not investigate any
fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance
on such Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its
rights or powers.
(e) The Trustee may refuse to perform any duty or exercise any right
or power or extend or risk its own funds or otherwise incur any financial
liability unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The
Trustee (acting in any capacity hereunder) shall be under no liability for
interest on any money received by it hereunder.
All rights and immunities granted to the Trustee under this Indenture shall
include the Trustee acting in any capacity under this Indenture.
Section 7.02. Individual Rights of Trustee. The Trustee in its individual
----------------------------
or any other capacity may become the owner or pledgee of Securities and may
otherwise deal with the Company or its Affiliates with the same rights it would
have if it were not Trustee. Any Paying Agent, Registrar, Conversion Agent or
co-registrar may do the same with like rights. However, the Trustee must comply
with Sections 7.09 and 7.10.
Section 7.03. Trustee's Disclaimer. The Trustee makes no representation as
--------------------
to the validity or adequacy of this Indenture or the Securities, it shall not be
accountable for the Company's use of the proceeds from the Securities, it shall
not be responsible for any statement in the registration statement for the
Securities under the Securities Act or in the Indenture or the Securities (other
than its certificate of authentication), or the determination as to which
beneficial owners are entitled to receive any notices hereunder.
Section 7.04. Notice of Defaults. The Trustee shall, within 90 days after
------------------
the occurrence of any Default, mail to all Holders of Securities, as the names
and addresses of such
40
Holders appear on the books of registry of the Company, notice of all Defaults
of which the Trustee shall be aware, unless such Defaults shall have been cured
or waived before the giving of such notice; provided that, except in the case of
a Default described in Section 6.01(a) or 6.01(b), 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 Trust Officers of
the Trustee in good faith determines that the withholding of such notice is in
the interests of the Holders of Securities.
Section 7.05. Reports by Trustee to Holders. Within 60 days after each May
-----------------------------
15 beginning with the May 15 following the date of this Indenture, the Trustee
shall mail to each Securityholder a brief report dated as of such May 15 that
complies with TIA Section 313(a), if required by said Section. The Trustee also
shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Securityholders shall
be provided to the Company and shall be submitted to the SEC and each stock
exchange on which the Securities are listed. The Company agrees promptly to
notify the Trustee whenever the Securities become listed on any stock exchange
and of any delisting thereof.
Section 7.06. Compensation and Indemnity. The Company agrees:
--------------------------
(a) to pay to the Trustee from time to time such reasonable
compensation for all services rendered by it hereunder (which compensation
shall not (to the extent permitted by law) be limited by any provision of
law in regard to the compensation of a trustee of an express trust);
(b) to reimburse the Trustee upon its request and, if required by the
Company, submission of reasonable documentation for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the reasonable
compensation and the expenses, advances and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(c) to indemnify each of the Trustee, its officers, directors,
employees and agents, or any predecessor Trustee for, and to hold it
harmless against, any and all loss, liability, damage, claim or expense,
including taxes (other than taxes based upon, measured or determined by the
income of the Trustee), incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration
of this trust, including the reasonable costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
The Trustee shall give the Company notice of any claim or liability for
which the Trustee might be entitled to indemnification under subparagraph (c) of
this Section 7.06, within a reasonable amount of time after a Trust Officer of
the Trustee becomes aware of such claim or liability. To secure the Company's
payment obligations in this Section 7.06, the Trustee shall have a lien prior to
the Securities on all money or property held or collected by the Trustee.
41
The Company's payment obligations pursuant to this Section 7.06 shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.01(d) or (e), the expenses
are intended to constitute expenses of administration under the Bankruptcy Law.
The provisions of this Section shall survive the termination of this Indenture.
Section 7.07. Replacement of Trustee. The Trustee may resign by so
----------------------
notifying the Company; provided, however, no such resignation shall be effective
until a successor Trustee has accepted its appointment pursuant to this Section
7.07. The Holders of a majority in aggregate Original Principal Amount of the
Securities at the time outstanding may remove the Trustee by so notifying the
Trustee and may appoint a successor Trustee (subject to the consent of the
Company, such consent not to be unreasonably withheld). The Company shall remove
the Trustee if:
(a) the Trustee fails to comply with Section 7.09;
(b) the Trustee is adjudged bankrupt or insolvent;
(c) a receiver or other public officer takes charge of the Trustee or
its property; or
(d) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint, by resolution of
its Board of Directors, a successor Trustee that meets the requirements of
Section 7.09.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to Securityholders. The
retiring Trustee shall promptly transfer all property held by it as Trustee to
the successor Trustee, subject to the lien provided for in Section 7.06.
If a successor Xxxxxxx does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of a majority in aggregate Original Principal Amount of the Securities
at the time outstanding may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.09, any Securityholder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
Section 7.08. Successor Trustee by Xxxxxx. If the Trustee consolidates
---------------------------
with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets to, another Person, the resulting, surviving
or transferee Person without any further act shall be the successor Trustee.
42
Section 7.09. Eligibility; Disqualification. The Trustee shall at all times
-----------------------------
satisfy the requirements of TIA Sections 310(a)(1) and 310(b). The Trustee shall
have a combined capital and surplus of at least $100,000,000 as set forth in its
most recent published annual report of condition. In determining whether the
Trustee has conflicting interests as defined in TIA Section 310(b)(1), the
provisions contained in the proviso to TIA Section 310(b)(1) shall be deemed
incorporated herein.
Section 7.10. Preferential Collection of Claims Against Company. The
-------------------------------------------------
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
ARTICLE VIII
DISCHARGE OF INDENTURE
Section 8.01. Discharge of Liability on Securities. When (i) the Company
------------------------------------
delivers to the Trustee all outstanding Securities (other than Securities
replaced pursuant to Section 2.07) for cancellation or (ii) all outstanding
Securities have become due and payable and the Company deposits with the Trustee
cash or, if expressly permitted by the terms hereof, securities sufficient to
pay at the Stated Maturity, the Purchase Date, the Change in Control Purchase or
the Redemption Date, the Contingent Principal Amount, the Purchase Price or
contingent interest (if any shall be due and unpaid), the Change in Control
Purchase Price or the Redemption Price, as the case may be, of all outstanding
Securities (other than Securities replaced pursuant to Section 2.07), and if, in
either case, the Company has paid all other sums payable hereunder by the
Company (including, without limitation, sums payable by delivery of shares of
Common Stock pursuant to Section 3.08), then this Indenture shall, subject to
Section 7.06, cease to be of further effect. The Trustee shall join in the
execution of a document prepared by the Company acknowledging satisfaction and
discharge of this Indenture on demand of the Company accompanied by an Officers'
Certificate and Opinion of Counsel and at the cost and expense of the Company.
Section 8.02. Repayment to the Company. The Trustee and the Paying Agent
------------------------
shall return to the Company any money or securities held by them for the payment
of any amount with respect to the Securities that remains unclaimed for two
years; provided, however, that the Trustee or such Paying Agent, before being
required to make any such return, may, at the expense of the Company, cause to
be published once in The Wall Street Journal or another daily newspaper of
national circulation or mail to each such Holder notice that such money or
securities remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such mailing, any unclaimed
money or securities then remaining will be returned to the Company. After return
to the Company, Holders entitled to the money or securities must look to the
Company for payment as general creditors unless an applicable abandoned property
law designates another person, and the Trustee and the Paying Agent shall have
no further liability with respect to such money or securities for that period
commencing after the return thereof.
43
ARTICLE IX
AMENDMENTS
Section 9.01. Without Consent of Holders. The Company and the Trustee may
--------------------------
amend this Indenture or the Securities without the consent of any
Securityholder:
(a) to cure any ambiguity, omission, defect or inconsistency;
provided, however, that such amendment does not materially adversely affect
the rights of any Securityholder;
(b) to comply with Article 5 or Section 11.14;
(c) to provide for uncertificated Securities in addition to or in
place of certificated Securities so long as such action shall not adversely
affect the interests of the Holders of the Securities in any material
respect;
(d) to make any change that does not materially adversely affect the
rights of any Securityholder;
(e) to add to the covenants or obligations of the Company hereunder or
to surrender any right, power or option herein conferred upon the Company;
(f) to secure the Company's obligations under the Securities and this
Indenture; or
(g) increase the contingent interest to be paid to Holders; or
(h) make any change to the Original Principal Amount of Securities
whose Holders must consent to an amendment or supplement to this Indenture.
(i) to make any change to comply with the TIA, or any amendment
thereafter, or any requirement of the SEC in connection with the
qualification of this Indenture under the TIA or any amendment thereof.
Section 9.02. With Consent of Holders. With the written consent of the
-----------------------
Holders of at least a majority in aggregate Original Principal Amount of the
Securities at the time outstanding, the Company and the Trustee may amend this
Indenture or the Securities. However, without the consent of each Securityholder
affected, an amendment or supplement to this Indenture or the Securities may
not:
(a) alter the manner or rate of accrual or payment of the Contingent
Principal Amount or contingent interest on any Security;
(b) make any Security payable in money or securities other than that
stated in the Security;
44
(c) make any reduction in the Original Principal Amount, Contingent
Principal Amount, Redemption Price, Purchase Price or Change in Control
Purchase Price with respect to any Security;
(d) make any change that adversely affects the right to convert any
Security (including the right to receive cash in lieu of Common Stock
except as set forth in Section 9.01(e));
(e) make any change that adversely affects the right to require the
Company to purchase the Securities pursuant to Sections 3.08 and 3.09
hereof;
(f) impair the right of a Holder to institute a suit for the
enforcement of any payment with respect to, or conversion of, the
Securities;
It shall not be necessary for the consent of the Holders under this Section
9.02 to approve the particular form of any proposed amendment, but it shall be
sufficient if such consent approves the substance thereof.
After an amendment under this Section 9.02 becomes effective, the Company
shall mail to each Holder a notice briefly describing the amendment.
Section 9.03. Compliance with Trust Indenture Act. Every supplemental
-----------------------------------
indenture executed pursuant to this Article shall comply with the TIA as then
in effect.
Section 9.04. Revocation and Effect of Consents, Waivers and Actions. Until
------------------------------------------------------
an amendment or waiver becomes effective, a consent to it or any other action by
a Holder of a Security hereunder is a continuing consent by the Holder and every
subsequent Holder of that Security or portion of the Security that evidences the
same obligation as the consenting Holder's Security, even if notation of the
consent, waiver or action is not made on the Security. However, any such Holder
or subsequent Holder may revoke the consent, waiver or action as to such
Holder's Security or portion of the Security if the Trustee receives the notice
of revocation before the date the amendment, waiver or action becomes effective.
After an amendment, waiver or action becomes effective, it shall bind every
Securityholder, except as provided in Section 9.02.
Section 9.05. Notation on or Exchange of Securities. 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 Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for outstanding
Securities.
Section 9.06. Trustee to Sign Supplemental Indentures. The Trustee shall
---------------------------------------
sign any supplemental indenture authorized pursuant to this Article 9 if the
amendment does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may, but need not, sign it.
In signing such amendment the Trustee shall be entitled to receive, and (subject
to the provisions of Section 7.01) shall be fully protected in relying upon, an
Officers' Certificate
45
and an Opinion of Counsel stating that such amendment is authorized or permitted
by this Indenture.
Section 9.07. 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.
ARTICLE X
CONTINGENT INTEREST
Section 10.01. Contingent Interest. Commencing on June 1, 2007, the Company
-------------------
shall make contingent interest payments to the holders of Securities, as set
forth in Section 10.02 below, during any six month period from June 1 to
November 30 and from December 1 to May 31 (each a "Semiannual Period") if, but
only if, the XXXXx Market Price of one Security during the relevant Measurement
Period equals or exceeds 120% of the Contingent Principal Amount of such
Security as of the May 31st or November 30th preceding the relevant Semiannual
Period. During any Semiannual Period when contingent interest is payable
pursuant to this section, each contingent interest payment due and payable on
each $1,000 Original Principal Amount of Security shall be calculated for each
of the first three months and the second three months of the applicable
Semiannual Period, and in each instance shall equal the greater of (i) the sum
of all regular cash dividends paid by the Company per share on the Common Stock
during the applicable three months of such Semiannual Period multiplied by the
Conversion Rate or (ii) $0.16 multiplied by 13.8213.
As used in this Article 10 "Measurement Period" means the five Trading Days
ending on the third scheduled Trading Day immediately preceding the start of the
relevant Semiannual Period. Notwithstanding the above, if the Company should
declare a dividend for which the record date for such dividend (the "Common
Stock Record Date") falls prior to the first day of a Semiannual Period, but the
payment date for such dividend falls within such Semiannual Period, then the
"Measurement Period" shall mean the five Trading Days ending on the third
Trading Day immediately preceding such Common Stock Record Date. "XXXXx Market
Price", means, as of any date of determination, the average of the secondary
market bid quotations per $1,000 Original Principal Amount of Securities
obtained by the Bid Solicitation Agent for $10 million Original Principal Amount
of Securities at approximately 4:00 p.m., New York City time, on such
determination date from three independent nationally recognized securities
dealers (none of which shall be an Affiliate of the Company) selected by the
Company; provided, however, if (a) at least three such bids are not obtained by
the Bid Solicitation Agent or (b) in the Company's reasonable judgment, the bid
quotations are not indicative of the secondary market value of the Securities as
of such determination date, then the LYON Market Price for such determination
date shall equal the product of (i) the Conversion Rate in effect as of such
determination date multiplied by (ii) the Average Sale Price of the Common Stock
for the five trading days ending on such determination date, appropriately
adjusted to take into account the occurrence, during the period commencing on
the first of such trading days during such five trading day period and
46
ending on such determination date, of any event described in Section 11.06,
11.07 or 11.08 (subject to the conditions set forth in Sections 11.09 and 11.10)
hereof.
The Contingent Principal Amount of the Securities will continue to accrue
at the applicable Yield whether or not contingent interest payments are made.
Section 10.02. Payment of Contingent Interest; Contingent Interest Rights
----------------------------------------------------------
Preserved.
---------
If payable, contingent interest shall be paid on the payment date for the
related Common Stock dividend or, if the Company does not pay a regular cash
dividend on its Common Stock during a Semiannual Period, on the last day of such
Semiannual Period (in each case, a "Contingent Interest Payment Date").
Contingent Interest payments on any Security that are payable, and are
punctually paid or duly provided for, on any Contingent Interest Payment Date
shall be paid to the person who is the holder of that Security at the close of
business on the relevant Common Stock Record Date or, if the Company does not
pay a regular cash dividend on its Common Stock during a Semiannual Period, to
the person who is the holder of that Security on the 15th day preceding the last
day of such Semiannual Period (each, a "Contingent Interest Record Date"). Each
payment of contingent interest on any Security shall be paid in same-day funds
by transfer to an account maintained by the payee located inside the United
States. In the case of a global Security, interest payable on any Contingent
Interest Payment Date will be paid to the Depositary for the purpose of
permitting DTC to credit the interest received by it in respect of such global
Security to the accounts of the beneficial owners thereof.
Upon determination that Holders of Securities will be entitled to receive
contingent interest during a Semiannual Period, on or prior to the start of such
Semiannual Period, the Company will issue a press release and publish such
information on its website for a period of not less than 120 days or, at the
Company's option, otherwise publicly disclose such information.
Section 10.03. Bid Solicitation Agent.
----------------------
The Bid Solicitation Agent shall solicit bids from securities dealers which
the Company indicates are willing to bid for the Securities. The Company
initially appoints the Trustee to act as the Bid Solicitation Agent. The Company
may change the Bid Solicitation Agent at its discretion, provided, however, the
Bid Solicitation Agent may not be an Affiliate of the Company.
ARTICLE XI
CONVERSION
Section 11.01. Conversion Privilege. A Holder of a Security may convert
--------------------
such Security into shares of Common Stock at any time during the period stated
in paragraph 9 of the Securities, subject to the provisions of this Article 11.
The number of shares of Common Stock issuable upon conversion of a Security per
$1,000 of Original Principal Amount thereof shall be determined in accordance
with the provisions of paragraph 9 in the Securities. The number of Shares
issuable upon conversion of a Security per $1,000 of Original Principal Amount
thereof shall equal 13.8213, subject to adjustment.
47
A Holder may convert a portion of a Security if the portion is $1,000
Original Principal Amount or an integral multiple of $1,000 Original Principal
Amount. Provisions of this Indenture that apply to conversion of all of a
Security also apply to conversion of a portion of a Security.
"Time of Determination" means the time and date of the earlier of (i) the
---------------------
determination of stockholders entitled to receive rights, warrants or options or
a distribution, in each case, to which Section 11.07 or 11.08 applies and (ii)
the time ("Ex-Dividend Time") immediately prior to the commencement of
"ex-dividend" trading for such rights, warrants or options or distribution on
the New York Stock Exchange or such other national or regional exchange or
market on which the Common Stock is then listed or quoted.
Section 11.02. Conversion Procedure. To convert a Security, a Holder must
--------------------
satisfy the requirements in paragraph 9 of the Securities. The date on which the
Holder satisfies all those requirements is the conversion date (the "Conversion
Date"). As soon as practicable after the Conversion Date, the Company shall
deliver to the Holder, through the Conversion Agent, a certificate for the
number of full shares of Common Stock issuable upon the conversion and cash in
lieu of any fractional share determined pursuant to Section 11.03. The Company
shall determine such full number of shares and the amounts of the required cash
with respect to any fractional share, and shall set forth such information in a
certificate delivered to the Conversion Agent. The Conversion Agent shall have
no duties under this paragraph unless and until it has received such
certificate.
The person in whose name the certificate is registered shall be treated as
a stockholder of record on and after the Conversion Date; provided, however,
that no surrender of a Security on any date when the stock transfer books of the
Company shall be closed shall be effective to constitute the person or persons
entitled to receive the shares of Common Stock upon such conversion as the
record holder or holders of such shares of Common Stock on such date, but such
surrender shall be effective to constitute the person or persons entitled to
receive such shares of Common Stock as the record holder or holders thereof for
all purposes at the close of business on the next succeeding day on which such
stock transfer books are open; such conversion shall be at the Conversion Rate
in effect on the date that such Security shall have been surrendered for
conversion, as if the stock transfer books of the Company had not been closed.
Upon conversion of a Security, such person shall no longer be a Holder of such
Security.
Holders may surrender a Security for conversion by means of book-entry
delivery in accordance with paragraph 9 of the Securities and the regulations of
the applicable book entry facility.
No payment or adjustment will be made for dividends on, or other
distributions with respect to, any Common Stock except as provided in this
Article 11. On conversion of a Security, that portion of accrued Tax Original
Issue Discount and increases in the Contingent Principal Amount attributable to
the period from the Issue Date of the Security through the Conversion Date and
(except as provided below) accrued contingent interest, if any, with respect to
the converted Security shall not be cancelled, extinguished or forfeited, but
rather shall be deemed to be paid in full to the Holder thereof through delivery
of the Common Stock (together with the cash payment, if any, in lieu of
fractional shares) in exchange for the Security being
48
converted pursuant to the provisions hereof; and the fair market value of such
shares of Common Stock (together with any such cash payment in lieu of
fractional shares) shall be treated as issued, to the extent thereof, first in
exchange for accrued Tax Original Issue Discount and the increase in Contingent
Principal Amount from the Issue Date through the Conversion Date and accrued
contingent interest, and the balance, if any, of such fair market value of such
Common Stock (and any such cash payment) shall be treated as issued in exchange
for the Issue Price of the Security being converted pursuant to the provisions
hereof.
If the Holder converts more than one Security at the same time, the number
of shares of Common Stock issuable upon the conversion shall be based on all
Securities converted.
A Security surrendered for conversion based on (a) the Common Stock price
may be surrendered for conversion until the close of business on the Business
Day immediately proceeding March 13, 2032, (b) a credit downgrade may be
surrendered for conversion until the close of business on any Business Day
during the period of the credit downgrade as more fully described in paragraph 9
of the Security, (c) the Security being called for redemption may be surrendered
for conversion at any time prior to the close of business on the second Business
Day immediately preceding the Redemption Date, and (d) upon the occurrence of
certain corporate transactions more fully described in paragraph 9 of the
Security may be surrendered for conversion at any time from and after the date
which is 15 days prior to the anticipated effective date of such transaction
until 15 days after the actual date of such transaction, and if such day is not
a Business Day, the next occurring Business Day following such day.
Upon surrender of a Security that is converted in part, the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder, a new
Security in an authorized denomination equal in Principal Amount to the
unconverted portion of the Security surrendered.
Section 11.03. Fractional Shares. The Company will not issue a fractional
-----------------
share of Common Stock upon conversion of a Security. Instead, the Company will
deliver cash for the current market value of the fractional share. The current
market value of a fractional share shall be determined, to the nearest 1/1,000th
of a share, by multiplying the Sale Price of the Common Stock, on the last
Trading Day prior to the Conversion Date, of a full share by the fractional
amount and rounding the product to the nearest whole cent.
Section 11.04. Taxes on Conversion. If a Holder converts a Security, the
-------------------
Company shall pay any documentary, stamp or similar issue or transfer tax due on
the issue of shares of Common Stock upon the conversion. However, the Holder
shall pay any such tax which is due because the Holder requests the shares to be
issued in a name other than the Holder's name. The Conversion Agent may refuse
to deliver the certificates representing the Common Stock being issued in a name
other than the Holder's name until the Conversion Agent receives a sum
sufficient to pay any tax which will be due because the shares are to be issued
in a name other than the Holder's name. Nothing herein shall preclude the
Company from any tax withholding or directing the withholding of any tax
required by law or regulations.
Section 11.05. Company to Provide Stock. The Company shall, prior to
------------------------
issuance of any Securities under this Article 11, and from time to time as may
be necessary, reserve out of its
49
authorized but unissued Common Stock a sufficient number of shares of Common
Stock to permit the conversion of the Securities.
All shares of Common Stock delivered upon conversion of the Securities
shall be newly issued shares or treasury shares, shall be duly and validly
issued and fully paid and nonassessable and shall be free from preemptive rights
and free of any lien or adverse claim.
The Company will endeavor promptly to comply with all Federal and state
securities laws regulating the offer and delivery of shares of Common Stock upon
conversion of Securities, if any, and will list or cause to have quoted such
shares of Common Stock on each national securities exchange or in the
over-the-counter market or such other market on which the Common Stock is then
listed or quoted.
Section 11.06. Adjustment for Change in Capital Stock. If, after the Issue
--------------------------------------
Date of the Securities, the Company:
(a) pays a dividend or makes a distribution on its Common Stock in
shares of its Common Stock or shares of other capital stock of the Company;
(b) subdivides its outstanding shares of Common Stock into a greater
number of shares;
(c) combines its outstanding shares of Common Stock into a smaller
number of shares; or
(d) issues by reclassification of its Common Stock any shares of its
capital stock (other than rights, warrants or options for its capital
stock);
then the conversion privilege and the Conversion Rate in effect immediately
prior to such action shall be adjusted so that the Holder of a Security
thereafter converted may receive the number of shares or other units of capital
stock of the Company which such Holder would have owned immediately following
such action if such Holder had converted the Security immediately prior to such
action.
The adjustment shall become effective immediately after the record date in
the case of a dividend or distribution and immediately after the effective date
in the case of a subdivision, combination or reclassification.
If after an adjustment a Holder of a Security upon conversion of such
Security may receive shares or other units of two or more classes of capital
stock of the Company, the Conversion Rate shall thereafter be subject to
adjustment upon the occurrence of an action taken with respect to any such class
or series of capital stock as is contemplated by this Article 11 with respect to
the Common Stock, on terms comparable to those applicable to Common Stock in
this Article 11.
Section 11.07. Adjustment for Rights Issue.
---------------------------
50
If after the Issue Date, the Company distributes any rights, warrants or options
to all holders of its Common Stock entitling them, for a period expiring within
60 days after the record date for such distribution, to purchase shares of
Common Stock at a price per share less than the Sale Price of the Common Stock
as of the Time of Determination, the Conversion Rate shall be adjusted in
accordance with the formula:
(O + N)
R' = R x ------------------
(O + [(N x P)/M)]
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
O = the number of shares of Common Stock outstanding on the record date
for the distribution to which this Section 11.07 is being applied.
N = the number of additional shares of Common Stock offered pursuant to
the distribution.
P = the offering price per share of the additional shares.
M = the Average Sale Price, minus, in the case of (i) a distribution to
which Section 11.06(d) applies or (ii) a distribution to which Section 11.08
applies, for which, in each case, (x) the record date shall occur on or before
the record date for the distribution to which this Section 11.07 applies and (y)
the Ex-Dividend Time shall occur on or after the date of the Time of
Determination for the distribution to which this Section 11.07 applies, the fair
market value (on the record date for the distribution to which this Section
11.07 applies) of:
(1) the capital stock of the Company distributed in respect
of each share of Common Stock in such Section 11.06(d) distribution;
and
(2) the assets of the Company or debt securities or any
rights, warrants or options to purchase securities of the Company
distributed in respect of each share of Common Stock in such Section
11.08 distribution.
The Board of Directors shall determine fair market values for the purposes
of this Section 11.07.
The adjustment shall become effective immediately after the record date for
the determination of shareholders entitled to receive the rights, warrants or
options to which this Section 11.07 applies. If all of the shares of Common
Stock subject to such rights, warrants or options have not been issued when such
rights, warrants or options expire, then the Conversion Rate shall promptly be
readjusted to the Conversion Rate which would then be in effect had the
adjustment upon the issuance of such rights, warrants or options been made on
the basis of the actual number of shares of Common Stock issued upon the
exercise of such rights, warrants or options.
51
No adjustment shall be made under this Section 11.07 if the application of
the formula stated above in this Section 11.07 would result in a value of R'
that is equal to or less than the value of R.
Section 11.08. Adjustment for Other Distributions. Subject to 11.08(b), if,
----------------------------------
after the Issue Date of the Securities, the Company distributes to all holders
of its Common Stock any of its assets excluding distributions of capital stock
or debt securities or any rights, warrants or options to purchase securities of
the Company (including securities or cash, but excluding (x) distributions of
capital stock referred to in Section 11.06 and distributions of rights, warrants
or options referred to in Section 11.07 and (y) cash dividends or other cash
distributions that are paid out of consolidated current net earnings or earnings
retained in the business as shown on the books of the Company unless such cash
dividends or other cash distributions are Extraordinary Cash Dividends) the
Conversion Rate shall be adjusted, subject to the provisions of Section
11.08(c), in accordance with the formula:
R x M
R' = --------
M - F
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the Average Sale Price, minus, in the case of a distribution to
which Section 11.06(d) applies, for which (i) the record date shall occur on or
before the record date for the distribution to which this Section 11.08 applies
and (ii) the Ex-Dividend Time shall occur on or after the date of the Time of
Determination for the distribution to which this Section 11.08 applies, the fair
market value (on the record date for the distribution to which this Section
11.08 applies) of any capital stock of the Company distributed in respect of
each share of Common Stock in such Section 11.06(d) distribution.
F = the fair market value (on the record date for the distribution to
which this Section 11.08 applies) of the assets, securities, rights, warrants or
options to be distributed in respect of each share of Common Stock in the
distribution to which this Section 11.08 is being applied (including, in the
case of cash dividends or other cash distributions giving rise to an adjustment,
all such cash distributed concurrently).
The Board of Directors shall determine fair market values for the purposes
of this Section 11.08.
The adjustment shall become effective immediately after the record date for
the determination of shareholders entitled to receive the distribution to which
this Section 11.08 applies.
For purposes of this Section 11.08, the term "Extraordinary Cash Dividend"
shall mean the amount of any cash dividend or distribution with respect to the
Common Stock that, together with the aggregate amount of other cash dividends on
the Common Stock to be aggregated with
52
such cash dividend in accordance with the provisions of this paragraph, equals
or exceeds the threshold percentage set forth in item (i) below. For purposes of
item (i) below, the "Ex-Dividend Measurement Period" with respect to a cash
dividend on the Common Stock shall mean the 365 consecutive day period ending on
the date prior to the Ex-Dividend Time with respect to such cash dividend, and
the "Relevant Cash Dividends" with respect to a cash dividend on the Common
Stock shall mean the cash dividends on the Common Stock with Ex-Dividend Times
occurring in the Measurement Period.
(i) If, upon the date prior to the Ex-Dividend Time with respect to a
cash dividend on the Common Stock, the aggregate amount of such cash
dividend together with the amounts of all Relevant Cash Dividends
equals or exceeds on a per share basis the sum of (a) 5% of the Sale
Price of the Common Stock on the last Trading Day preceding the date
of declaration by the Board of Directors of the cash dividend or
distribution with respect to which this provision is being applied,
and (b) the quotient of the amount of any contingent interest paid on
a Security during the Ex-Dividend Measurement Period and divided by
the conversion rate in effect on the payment date of such relevant
Contingent Interest Payment Date, then such cash dividend together
with all Relevant Cash Dividends, shall be deemed to be an
Extraordinary Cash Dividend and for purposes of applying the formula
set forth above in this Section 11.08, the value of "F" shall be equal
to (y) the aggregate amount of such cash dividend together with the
amount of all Relevant Cash Dividends, minus (z) the aggregate amount
of all Relevant Cash Dividends for which a prior adjustment in the
Conversion Rate was previously made under this Section 11.08.
In making the determinations required by item (i) above, the amount of
cash dividends paid on a per share basis and the amount of any
Relevant Cash Dividends specified in item (i) above, shall be
appropriately adjusted to reflect the occurrence during such period of
any event described in Section 11.06.
(a) If, after the Issue Date, the Company pays a dividend or makes a
distribution to all holders of its Common Stock consisting of capital stock
of any class or series, or similar equity interests, of or relating to a
Subsidiary or other business unit of the Company, the Conversion Rate shall
be adjusted in accordance with the formula:
R' = R x (1 + F/M)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the average of the Sale Prices of the Common Stock for the ten (10)
Trading Days commencing on and including the fifth Trading Day after the date on
which "ex-dividend trading" commences for such dividend or distribution on The
New York Stock Exchange or such other national or regional exchange or market
which such securities are then listed or quoted (the "Ex-Dividend Date").
53
F = the fair market value of the securities distributed in respect of
each share of Common Stock for which this Section 11.08(a) applies shall mean
the number of securities distributed in respect of each share of Common Stock
multiplied by the average of the Sale Prices of those securities distributed for
the ten (10) Trading Days commencing on and including the fifth Trading Day
after the effectiveness of the Ex-Dividend Date.
(b) In the event that, with respect to any distribution to which
Section 11.08(a) or (b) would otherwise apply, the difference between
"M-F" is less than $1.00 or "F" is equal to or greater than "M", then
the adjustment provided by Section 11.08(a) shall not be made and in
lieu thereof the provisions of Section 11.14 shall apply to such
distribution.
Section 11.09. When Adjustment May Be Deferred. No adjustment in the
-------------------------------
Conversion Rate need be made unless the adjustment would require an increase or
decrease of at least 1% in the Conversion Rate. Any adjustments that are not
made shall be carried forward and taken into account in any subsequent
adjustment.
All calculations under this Article 11 shall be made to the nearest cent or
to the nearest 1/1,000th of a share, as the case may be.
Section 11.10. When No Adjustment Required. No adjustment need be made for
---------------------------
a transaction referred to in Section 11.06, 11.07, 11.08 or 11.14 if
Securityholders are to participate in the transaction on a basis and with notice
that the Board of Directors determines to be fair and appropriate in light of
the basis and notice on which holders of Common Stock participate in the
transaction. Such participation by Securityholders may include participation
upon conversion provided that an adjustment shall be made at such time as the
Securityholders are no longer entitled to participate.
No adjustment need be made for rights to purchase Common Stock pursuant to
a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value or no par value of
the Common Stock.
To the extent the Securities become convertible pursuant to this Article 11
into cash, no adjustment need be made thereafter as to the cash. Interest will
not accrue on the cash.
Notwithstanding any provision to the contrary in this Indenture, no
adjustment shall be made in the Conversion Rate to the extent, but only to the
extent, such adjustment results in the following quotient being less than the
par value of the Common Stock: (i) the Contingent Principal Amount as of the
date such adjustment would otherwise be effective divided by (ii) the Conversion
Rate as so adjusted.
No adjustment will be made pursuant to this Section 11 which would result,
through the application of two or more provisions hereof, in the duplication of
any adjustment.
Section 11.11. Notice of Adjustment. Whenever the Conversion Rate is
--------------------
adjusted, the Company shall promptly mail to Securityholders a notice of the
adjustment. The Company
54
shall file with the Trustee and the Conversion Agent such notice and a
certificate from the Company's independent public accountants briefly stating
the facts requiring the adjustment and the manner of computing it. Upon receipt
by it of such notice, the Conversion Agent will promptly mail such notice to
Securityholders at the Company's expense. The certificate shall be conclusive
evidence that the adjustment is correct. Neither the Trustee nor any Conversion
Agent shall be under any duty or responsibility with respect to any such
certificate except to exhibit the same to any Holder desiring inspection
thereof.
Section 11.12. Voluntary Increase. The Company from time to time may
------------------
increase the Conversion Rate by any amount for any period of time. Whenever the
Conversion Rate is increased, the Company shall mail to Securityholders and file
with the Trustee and the Conversion Agent a notice of the increase. The Company
shall mail the notice at least 15 days before the date the increased Conversion
Rate takes effect. The notice shall state the increased Conversion Rate and the
period it will be in effect.
A voluntary increase of the Conversion Rate does not change or adjust the
Conversion Rate otherwise in effect for purposes of Section 11.06, 11.07 or
11.08.
55
Section 11.13. Notice of Certain Transactions. If:
------------------------------
(a) the Company takes any action that would require an adjustment in
the Conversion Rate pursuant to Section 11.06, 11.07 or 11.08 (unless no
adjustment is to occur pursuant to Section 11.10); or
(b) the Company takes any action that would require a supplemental
indenture pursuant to Section 11.14; or
(c) there is a liquidation or dissolution of the Company;
then the Company shall mail to Securityholders and file with the Trustee and the
Conversion Agent a notice stating the proposed record date for a dividend or
distribution or the proposed effective date of a subdivision, combination,
reclassification, consolidation, merger, binding share exchange, transfer,
liquidation or dissolution. The Company shall file and mail the notice at least
15 days before such date. Failure to file or mail the notice or any defect in it
shall not affect the validity of the transaction.
Section 11.14. Reorganization of Company; Special Distributions. If the
------------------------------------------------
Company is a party to a transaction subject to Section 5.01 (other than a sale
of all or substantially all of the assets of the Company in a transaction in
which the holders of Common Stock immediately prior to such transaction do not
receive securities, cash, property or other assets of the Company or any other
person) or a merger or binding share exchange which reclassifies or changes its
outstanding Common Stock, the person obligated to deliver securities, cash or
other assets upon conversion of Securities shall enter into a supplemental
indenture. If the issuer of securities deliverable upon conversion of Securities
is an Affiliate of the successor Company, that issuer shall join in the
supplemental indenture.
The supplemental indenture shall provide that the Holder of a Security may
convert it into the kind and amount of securities, cash or other assets which
such Holder would have received immediately after the consolidation, merger,
binding share exchange or transfer if such Holder had converted the Security
immediately before the effective date of the transaction, assuming (to the
extent applicable) that such Holder (i) was not a constituent person or an
Affiliate of a constituent person to such transaction; (ii) made no election
with respect thereto; and (iii) was treated alike with the plurality of
non-electing Holders. The supplemental indenture shall provide for adjustments
which shall be as nearly equivalent as may be practical to the adjustments
provided for in this Article 11. The successor Company shall mail to
Securityholders a notice briefly describing the supplemental indenture.
If this Section applies, neither Section 11.06 nor 11.07 applies.
If the Company makes a distribution to all holders of its Common Stock of
any of its assets, or debt securities or any rights, warrants or options to
purchase securities of the Company that, but for the provisions of Section
11.08(c), would otherwise result in an adjustment in the Conversion Rate
pursuant to the provisions of Section 11.08, then, from and after the record
date for determining the holders of Common Stock entitled to receive the
distribution, a Holder of a Security that converts such Security in accordance
with the provisions of this Indenture shall upon such conversion be entitled to
receive, in addition to the shares of Common Stock into
56
which the Security is convertible, the kind and amount of securities, cash or
other assets comprising the distribution that such Holder would have received if
such Holder had converted the Security immediately prior to the record date for
determining the holders of Common Stock entitled to receive the distribution.
Section 11.15. Company Determination Final. Any determination that the
---------------------------
Company or the Board of Directors must make pursuant to Section 11.03, 11.06,
11.07, 11.08, 11.09, 11.10, 11.14 or 11.17 is conclusive.
Section 11.16. Trustee's Adjustment Disclaimer. The Trustee has no duty to
-------------------------------
determine when an adjustment under this Article 11 should be made, how it should
be made or what it should be. The Trustee has no duty to determine whether a
supplemental indenture under Section 11.14 need be entered into or whether any
provisions of any supplemental indenture are correct. The Trustee shall not be
accountable for and makes no representation as to the validity or value of any
securities or assets issued upon conversion of Securities. The Trustee shall not
be responsible for the Company's failure to comply with this Article 11. Each
Conversion Agent (other than the Company or an Affiliate of the Company) shall
have the same protection under this Section 11.16 as the Trustee.
Section 11.17. Simultaneous Adjustments. In the event that this Article 11
------------------------
requires adjustments to the Conversion Rate under more than one of Sections
11.06(d), 11.07 or 11.08, and the record dates for the distributions giving rise
to such adjustments shall occur on the same date, then such adjustments shall be
made by applying, first, the provisions of Section 11.06, second, the provisions
of Section 11.08 and, third, the provisions of Section 11.07.
Section 11.18. Successive Adjustments. After an adjustment to the
----------------------
Conversion Rate under this Article 11, any subsequent event requiring an
adjustment under this Article 11 shall cause an adjustment to the Conversion
Rate as so adjusted.
Section 11.19. Rights Issued in Respect of Common Stock Issued Upon
----------------------------------------------------
Conversion. Each share of Common Stock issued upon conversion of Securities
----------
pursuant to this Article 11 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 may be
provided by the Rights or by the terms of any other shareholder rights agreement
adopted by the Company, as the same may be amended from time to time (in each
case, a "Rights Agreement"). Provided that such Rights Agreement requires that
each share of Common Stock issued upon conversion of Securities at any time
prior to the distribution of separate certificates representing the Rights be
entitled to receive such Rights, then, notwithstanding anything else to the
contrary in this Article 11, there shall not be any adjustment to the conversion
privilege or Conversion Rate as a result of the issuance of Rights, the
distribution of separate certificates representing the Rights, the exercise or
redemption of such Rights in accordance with any such Rights Agreement, or the
termination or invalidation of such Rights.
ARTICLE XII
PAYMENT OF CONTINGENT INTEREST
57
Section 12.01. Contingent Interest Payments. If applicable, contingent
----------------------------
interest on any Security that is payable, and is punctually paid or duly
provided for, on any Contingent Interest Payment Date shall be paid to the
person in whose name that Security is registered at the close of business on the
record date specified in Section 10.02 ("Regular Record Date") at the office or
agency of the Company maintained for such purpose. Each installment of
contingent interest on any Security shall be paid in same-day funds by transfer
to an account maintained by the payee located inside the United States. In the
case of a Global Security, contingent interest payable on any applicable payment
date will be paid to the Depositary, with respect to that portion of such Global
Security held for its account by Cede & Co. for the purpose of permitting such
party to credit the interest received by it in respect of such Global Security
to the accounts of the beneficial owners thereof.
Section 12.02. Defaulted Interest. Any contingent interest on any Security
------------------
that is payable, but is not punctually paid or duly provided for, within 30 days
following any Contingent Interest Payment Date (herein called "Defaulted
Interest", which term shall include any accrued and unpaid interest that has
accrued on such defaulted amount in accordance with paragraph 1 of the
Securities), shall forthwith cease to be payable to the registered Holder
thereof 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 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 (which
shall not be less than 20 days after such notice is received by the
Trustee), 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 on or prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of
the persons entitled to such Defaulted Interest as in this clause provided.
Thereupon the Trustee shall fix a special record date (the "Special Record
Date") for the payment of such Defaulted Interest which shall be not more
than 15 days and not less than ten (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 his address as
it appears on the list of Securityholders maintained pursuant to Section
2.05 not less than 10 days prior to such Special Record Date. The Trustee
may, in its discretion, in the name and at the expense of the Company,
cause a similar notice to be published at least once in The Wall Street
Journal, but such publications shall not be a condition precedent to the
establishment of such Special Record Date. Notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor having been
mailed as aforesaid, such Defaulted Interest shall be paid to the persons
in whose names the Securities are registered at the close of business
58
on such Special Record Date and shall no longer be payable pursuant to the
following clause (b).
(b) The Company may make payment of any Defaulted Interest on the
Securities in any other lawful manner not inconsistent with the
requirements of any securities exchange on which such 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.
Section 12.03. Interest Rights Preserved. Subject to the foregoing
-------------------------
provisions of this Article 12 and Section 2.06, 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 contingent interest accrued and
unpaid, which were carried by such other Security.
ARTICLE XIII
MISCELLANEOUS
Section 13.01. Trust Indenture Act Controls. If any provision of this
----------------------------
Indenture limits, qualifies or conflicts with another provision which is
required or deemed to be included in this Indenture by the TIA, the required or
deemed provision shall control.
Section 13.02. Notices. Any notice or communication shall be in writing and
-------
delivered in person or mailed by first-class mail, postage prepaid, addressed as
follows:
if to the Company:
Xxxxxxx Xxxxx & Co., Inc.
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Secretary
with a copy to:
Xxxxxxx Xxxxx & Co., Inc.
4 World Financial Center, 18th Floor
New York, New York 10080
Attention: Treasurer
59
if to the Trustee:
JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Institutional Trust Services
The Company or the Trustee by notice to the other may designate additional
or different addresses for subsequent notices or communications.
Any notice or communication given to a Securityholder shall be mailed by
first-class mail to the Securityholder at the Securityholder's address as it
appears on the registration books of the Registrar and shall be sufficiently
given if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any defect
in it shall not affect its sufficiency with respect to other Securityholders. If
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not received by the addressee.
If the Company mails a notice or communication to the Securityholders, it
shall mail a copy to the Trustee and each Registrar, Paying Agent, Conversion
Agent or co-registrar.
Section 13.03. Communication by Holders with Other Holders. Securityholders
-------------------------------------------
may communicate pursuant to TIA Section 312(b) with other Securityholders with
respect to their rights under this Indenture or the Securities. The Company, the
Trustee, the Registrar, the Paying Agent, the Conversion Agent and anyone else
shall have the protection of TIA Section 312(c).
Section 13.04. Certificate and Opinion as to Conditions Precedent. Upon any
--------------------------------------------------
request or application by the Company to the Trustee to take any action under
this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(b) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
Section 13.05. Statements Required in Certificate or Opinion. Each
---------------------------------------------
Officers' Certificate or Opinion of Counsel with respect to compliance with a
covenant or condition provided for in this Indenture shall include:
(a) a statement that each person making such Officers' Certificate or
Opinion of Counsel has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
Officers' Certificate or Opinion of Counsel are based;
60
(c) a statement that, in the opinion of each such person, he has made
such examination or investigation as is necessary to enable such person to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement that, in the opinion of such person, such covenant or
condition has been complied with.
Section 13.06. Separability Clause. In case any provision in this Indenture
-------------------
or in the Securities shall be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
Section 13.07. Rules By Trustee, Paying Agent, Conversion Agent and
----------------------------------------------------
Registrar. The Trustee may make reasonable rules for action by or a meeting of
---------
the Securityholders. The Registrar, Conversion Agent and the Paying Agent may
make reasonable rules for their functions.
Section 13.08. [Reserved].
--------
Section 13.09. Governing Law. THIS INDENTURE AND THE SECURITIES SHALL BE
-------------
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICT OF LAWS.
Section 13.10. No Recourse Against Others. A director, Officer, employee or
--------------------------
stockholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or this Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Securityholder shall waive and release
all such liability. The waiver and release shall be part of the consideration
for the issue of the Securities.
Section 13.11. Successors. All agreements of the Company in this Indenture
----------
and the Securities shall bind its successor. All agreements of the Trustee in
this Indenture shall bind its successor.
Section 13.12. Multiple Originals. The parties may sign any number of
------------------
copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. One signed copy is enough to prove this
Indenture.
Section 13.13. References. All section references are to sections of this
----------
Indenture unless specified otherwise.
Section 13.14. Calculations. The Company shall be solely responsible for
------------
making all calculations called for under the Securities and this Indenture. Such
calculations include, but are not limited to, the calculations under Articles 3,
4, 6,10, 11 and 12 hereof. The Company covenants to make all such calculations
in good faith. Absent manifest error, such calculations shall be final and
binding on Holders. The Company shall promptly provide a schedule of all its
calculations to the Trustee. The Trustee shall always be entitled to assume that
the Company has
61
acted in good faith, and may rely on and shall be fully protected and shall
incur no liability in relying on any calculation performed by the Company under
or pursuant to the Indenture.
Section 13.15. Tax Matters.
-----------
(a) Tax Treatment. The parties hereto hereby agree, and each Holder by
its purchase of a Security hereby agrees:
(1) to treat the Securities as indebtedness of the Company for
all tax purposes;
(2) to treat the Securities as indebtedness that are subject to
the special regulations governing contingent payment debt instruments that
are contained in U.S. Treasury Regulation section 1.1275-4; and
(3) to treat any payment to and receipt by a Holder of Common
Stock upon conversion of a Security, or upon a redemption of a Security
where the Company elects to pay in Common Stock, as a contingent payment
under Treasury Regulation section 1.1275-4(b) that will result in an
adjustment under Treasury Regulation section 1.1275-4(b)(3)(iv) and
Treasury Regulation section 1.1275-4(b)(6).
(b) Comparable Yield and Projected Payment Schedule. Solely for
purposes of applying Treasury Regulation section 1.1275-4 to the
Securities:
(1) for United States Federal income tax purposes, the Company
shall accrue interest with respect to outstanding Securities as original
issue discount according to the "noncontingent bond method," as set forth
in Treasury Regulation Section 1.1275-4(b);
(2) the Company has determined that the comparable yield, as
defined in Treasury Regulation section 1.1275-4(b)(4)(i), for the
Securities is 5.714%, compounded semiannually;
(3) the Company has determined that the projected payment
schedule, as defined in Treasury Regulation section 1.1275-4(b)(4)(ii), for
the Securities consists of the projected payment schedule referred to in
(5) below;
(4) the Company acknowledges and agrees, and each Holder and any
beneficial holder of a Security, by its purchase of a Security shall be
deemed to acknowledge and agree, that (i) the comparable yield and the
projected payment schedule are determined on the basis of an assumption of
linear growth of stock price and a constant dividend yield, (ii) the
comparable yield and the projected payment schedule are not determined for
any purpose other than for the purpose of applying Treasury Regulation
section 1.1275-4(b)(4) to the Securities and (iii) the comparable yield and
the projected payment schedule do not constitute a projection or
representation regarding the actual amounts payable on the Securities; and
62
(5) the projected payment schedule, as defined in Treasury
Regulation section 1.1275-4(b)(4)(ii) for the Securities is set forth in
Annex 1 hereto.
63
SIGNATURES
IN WITNESS WHEREOF, the undersigned, being duly authorized, have
executed this Indenture on behalf of the respective parties hereto as of the
date first above written.
XXXXXXX XXXXX & CO., INC.
By
----------------------------------
Name:
Title:
JPMORGAN CHASE BANK
By:
---------------------------------
Name:
Title:
ANNEX 1
Projected Payment Schedule*
Quarterly Period Ending Projected Payment per LYON
----------------------- --------------------------
June 1, 2002 -
September 1, 2002 -
December 1, 2002 -
March 1, 2003 -
June 1, 2003 -
September 1, 2003 -
December 1, 2003 -
March 1, 2004 -
June 1, 2004 -
September 1, 2004 -
December 1, 2004 -
March 1, 2005 -
June 1, 2005 -
September 1, 2005 -
December 1, 2005 -
March 1, 2006 -
June 1, 2006 -
September 1, 2006 -
December 1, 2006 -
March 1, 2007 -
June 1, 2007 -
September 1, 2007 -
December 1, 2007 -
March 1, 2008 -
June 1, 2008 -
September 1, 2008 -
December 1, 2008 -
March 1, 2009 -
June 1, 2009 -
September 1, 2009 -
December 1, 2009 -
March 1, 2010 -
June 1, 2010 -
September 1, 2010 -
----------
* The comparable yield and the schedule of projected payments are determined on
the basis of an assumption of constant growth rate of the stock price and a
constant dividend growth rate and are not determined for any purpose other
than for the determination of interest accruals and adjustments thereof in
respect of the Securities for United States federal income tax purposes. The
comparable yield and the schedule of projected payments do not constitute a
projection or representation regarding the amounts payable on Securities.
Quarterly Period Ending Projected Payment per LYON
----------------------- --------------------------
December 1, 2010 -
March 1, 2011 -
June 1, 2011 -
September 1, 2011 -
December 1, 2011 -
March 1, 2012 -
June 1, 2012 -
September 1, 2012 -
December 1, 2012 -
March 1, 2013 -
June 1, 2013 -
September 1, 2013 -
December 1, 2013 -
March 1, 2014 -
June 1, 2014 -
September 1, 2014 -
December 1, 2014 -
March 1, 2015 -
June 1, 2015 -
September 1, 2015 -
December 1, 2015 -
March 1, 2016 5.13
June 1, 2016 5.45
September 1, 2016 5.45
December 1, 2016 5.45
March 1, 2017 5.45
June 1, 2017 5.78
September 1, 2017 5.78
December 1, 2017 5.78
March 1, 2018 5.78
June 1, 2018 6.14
September 1, 2018 6.14
December 1, 2018 6.14
March 1, 2019 6.14
June 1, 2019 6.52
September 1, 2019 6.52
December 1, 2019 6.52
March 1, 2020 6.52
June 1, 2020 6.92
September 1, 2020 6.92
December 1, 2020 6.92
March 1, 2021 6.92
June 1, 2021 7.35
September 1, 2021 7.35
December 1, 2021 7.35
March 1, 2022 7.35
Quarterly Period Ending Projected Payment per LYON
----------------------- --------------------------
June 1, 2022 7.81
September 1, 2022 7.81
December 1, 2022 7.81
March 1, 2023 7.81
June 1, 2023 8.29
September 1, 2023 8.29
December 1, 2023 8.29
March 1, 2024 8.29
June 1, 2024 8.81
September 1, 2024 8.81
December 1, 2024 8.81
March 1, 2025 8.81
June 1, 2025 9.35
September 1, 2025 9.35
December 1, 2025 9.35
March 1, 2026 9.35
June 1, 2026 9.93
September 1, 2026 9.93
December 1, 2026 9.93
March 1, 2027 9.93
June 1, 2027 10.55
September 1, 2027 10.55
December 1, 2027 10.55
March 1, 2028 10.55
June 1, 2028 11.20
September 1, 2028 11.20
December 1, 2028 11.20
March 1, 2029 11.20
June 1, 2029 11.89
September 1, 2029 11.89
December 1, 2029 11.89
March 1, 2030 11.89
June 1, 2030 12.63
September 1, 2030 12.63
December 1, 2030 12.63
March 1, 2031 12.63
June 1, 2031 13.41
September 1, 2031 13.41
December 1, 2031 13.41
March 1, 2032 13.41
March 13, 2032 4,559.34
EXHIBIT A
[FORM OF FACE OF GLOBAL SECURITY]
FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, THIS SECURITY IS ISSUED WITH AN INDETERMINATE AMOUNT OF
ORIGINAL ISSUE DISCOUNT FOR UNITED STATES FEDERAL INCOME TAX PURPOSES. THE ISSUE
DATE IS MARCH 13, 2002, AND THE YIELD TO MATURITY FOR PURPOSES OF ACCRUING
ORIGINAL ISSUE DISCOUNT IS 5.714% PER ANNUM. THE HOLDER OF THIS SECURITY MAY
OBTAIN THE PROJECTED PAYMENT SCHEDULE BY SUBMITTING A WRITTEN REQUEST FOR SUCH
INFORMATION TO: XXXXXXX XXXXX & CO., INC., CORPORATE SECRETARY'S OFFICE, 000
XXXXXXXX, 00XX XXXXX, XXX XXXX, XXX XXXX 00000.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF THE DEPOSITARY. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR THE INDIVIDUAL DEBT SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY
NOT BE TRANSFERRED EXCEPT AS A WHOLE 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.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), XXXXXXX XXXXX & CO.,
INC. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL, INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
[FORM OF REVERSE SIDE OF LYON]
XXXXXXX XXXXX & CO., INC.
Liquid Yield Option/TM/ Note due 2032
(Zero Coupon-Floating Rate-Senior)
No. R- CUSIP: 590188 A73
Issue Date: March 13, 2002
Original Principal Amount: $
Issue Price: $1,000.00 for each $1,000
Original Principal Amount
XXXXXXX XXXXX & CO., INC., a Delaware corporation, promises to pay to Cede
& Co. or registered assigns, on March 13, 2032 the Contingent Principal Amount
of this Security on such date. This Security is issued with an Original
Principal Amount of DOLLARS ($ ).
This Security shall not bear interest except as specified on the reverse
side of this Security. The Contingent Principal Amount of this Security, will
accrue as specified on the reverse side of this Security. This Security is
convertible as specified on the reverse side of this Security.
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Additional provisions of this Security are set forth on the reverse side of
this Security.
Dated: March 13, 2002 XXXXXXX XXXXX & CO., INC.
By:
-----------------------------------
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
JPMORGAN CHASE BANK,
as Trustee, certifies that this
is one of the Securities referred
to in the within-mentioned Indenture.
By: ________________________
Authorized Signatory
Dated: March 13, 2002
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Liquid Yield Option/TM/ Note due 2032
(Zero Coupon-Floating Rate-Senior)
1. Interest.
--------
This Security shall not bear interest, except as specified in paragraph
5 hereof. At Stated Maturity, the Holder of this Security will receive the
Contingent Principal Amount of this Security on such date, which for each $1,000
Original Principal Amount will be equal to such Original Principal Amount of
$1,000 per Security increased daily by the applicable Yield as provided in the
Indenture. If the Contingent Principal Amount hereof or any portion of such
Contingent Principal Amount is not paid when due (whether upon acceleration
pursuant to Section 6.02 of the Indenture, upon the date set for payment of the
Redemption Price pursuant to paragraph 6 hereof, upon the date set for payment
of the Purchase Price or Change in Control Purchase Price pursuant to paragraph
7 hereof or upon the Stated Maturity of this Security) or if contingent
interest, if any, due hereon or any portion of such contingent interest is not
paid when due in accordance with paragraph 5 hereof, then in each such case the
overdue amount shall, to the extent permitted by law, bear interest at the then
applicable Yield, compounded semi-annually, which interest shall accrue from the
date such overdue amount was originally due to the date payment of such amount,
including interest thereon, has been made or duly provided for. All such
interest shall be payable on demand. The accrual of such interest on overdue
amounts shall be in lieu of, and not in addition to any subsequent increase in
the Contingent Principal Amount.
The Contingent Principal Amount of each Security will accrue daily at
the applicable Yield applied to the Contingent Principal Amount as of the day
preceding the most recent Yield Reset Date, commencing on June 13, 2002.
Regardless of the level of 3-month LIBOR, the Yield will never be less than zero
and, after March 13, 2007, the Yield will not exceed 5.5% per annum. The Yield
will be calculated using the actual number of days elapsed between the Yield
Reset Dates divided by 360.
2. Method of Payment.
-----------------
Subject to the terms and conditions of the Indenture, the Company will
make payments in respect of Contingent Principal Amount, Redemption Prices,
Purchase Price, Change in Control Purchase Prices and at Stated Maturity to
Holders who surrender Securities to a Paying Agent to collect such payments in
respect of the Securities. In addition, the Company will pay contingent
interest, if any. The Company will pay cash amounts in money of the United
States that at the time of payment is legal tender for payment of public and
private debts. However, the Company may make such cash payments by check payable
in such money.
3. Paying Agent, Conversion Agent, Registrar and Bid Solicitation Agent.
--------------------------------------------------------------------
Initially, JPMorgan Chase Bank, a banking corporation organized and
existing under the laws of the State of New York, (the "Trustee"), will act as
Paying Agent, Conversion Agent, Registrar and Bid Solicitation Agent. The
Company may appoint and change any Paying Agent, Conversion Agent, Registrar or
co-registrar or Bid Solicitation Agent without notice, other than
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notice to the Trustee, except that the Company will maintain at least one Paying
Agent in the State of New York, City of New York, Borough of Manhattan, which
shall initially be an office or agency of the Trustee. The Company or any of its
Subsidiaries or any of their Affiliates may act as Paying Agent, Conversion
Agent, Registrar or co-registrar. None of the Company, any of its Subsidiaries
or any of their Affiliates shall act as Bid Solicitation Agent.
4. Indenture.
---------
The Company has issued the Securities under an Indenture dated as of
March 13, 2002 (the "Indenture"), between the Company and the Trustee. The terms
of the Securities include those stated in the Indenture and those made part of
the Indenture by reference to the Securities themselves and the Trust Indenture
Act of 1939, as in effect from time to time (the "TIA"). Capitalized terms used
herein and not defined herein have the meanings ascribed thereto in the
Indenture. The Securities are subject to all such terms, and Securityholders are
referred to the Indenture and the TIA for a statement of those terms.
The Securities are unsecured and unsubordinated obligations of the
Company limited to $2,300,000,000 aggregate Original Principal Amount (subject
to Section 2.07 of the Indenture) and will rank equally in right of payment to
all the Company's present and future unsecured and unsubordinated indebtedness.
The Indenture does not limit other indebtedness of the Company, secured or
unsecured.
5. Contingent Interest.
-------------------
Subject to the conditions of the Indenture and the accrual and record
date provisions specified in this paragraph 5, the Company shall pay contingent
interest to the Holders during any six-month period (a "Contingent Interest
Period") from June 1 to November 30 and from December 1 to May 31, with the
initial six-month period commencing after June 1, 2007, if the average LYON
Market Price for the Measurement Period with respect to such Contingent Interest
Period equals 120% or more of the Contingent Principal Amount of a Security
accrued thereon to the day immediately preceding the first day of the relevant
Contingent Interest Period.
Contingent interest, if any, will accrue and be payable on such days
and to holders of this Security as of such record dates as provided in Section
10.02 of the Indenture. The Contingent Principal Xxxxxx will continue to
increase at the applicable Yield whether or not contingent interest is paid.
The amount of contingent interest payable per $1,000 Original Principal
Amount hereof in respect of either the first three-month period or the second
three-month period any Contingent Interest Period shall equal the greater of (x)
$0.16 multiplied by 13.8213 and (y) the sum of all Regular Cash Dividends paid
by the Company per share of Common Stock during that three-month period of the
applicable Contingent Interest Period multiplied by the number of shares of
Common Stock into which $1,000 Original Principal Amount of a Security is
convertible pursuant to paragraph 9 hereof as of the accrual date for such
contingent interest.
Upon determination that Holders will be entitled to receive contingent
interest during a Contingent Interest Period the Company shall issue a press
release and publish such information
A-5
on its web site on the World Wide Web for a period of not less than 120 days or,
at the Company's option, otherwise publicly disclose such information.
6. Redemption at the Option of the Company.
---------------------------------------
No sinking fund is provided for the Securities. The Securities are
redeemable as a whole, or from time to time in part, at any time at the option
of the Company at a Redemption Price equal to the Contingent Principal Amount of
the Securities on the Redemption Date, provided that the Securities are not
redeemable prior to March 13, 2007.
7. Purchase by the Company at the Option of the Holder.
---------------------------------------------------
Subject to the terms and conditions of the Indenture, the Company shall
become obligated to purchase, at the option of the Holder, the Securities held
by such Holder on March 13, 2005, 2007, 2012, 2017, 2022 and 2027 at a price
equal to the Contingent Principal Amount of the Securities on the Purchase Date,
upon delivery of a Purchase Notice containing the information set forth in the
Indenture, at any time from the opening of business on the date that is at least
20 Business Days prior to such Purchase Date until the close of business on the
Business Day immediately preceding such Purchase Date and upon delivery of the
Securities to the Paying Agent by the Holder as set forth in the Indenture.
The Purchase Price may be paid, at the option of the Company, in cash
or by the issuance and delivery of shares of Common Stock of the Company, or in
any combination thereof.
At the option of the Holder and subject to the terms and conditions of
the Indenture, the Company shall become obligated to purchase all or a portion
of the Securities in integral multiples of $1,000 Original Principal Amount held
by such Holder no later than 35 Business Days after the occurrence of a Change
in Control of the Company occurring on or prior to March 13, 2007 for a Change
in Control Purchase Price for each $1,000 Original Principal Amount of such
Securities equal to the Contingent Principal Amount on the Change in Control
Purchase Date, which Change in Control Purchase Price shall be paid in cash.
Holders have the right to withdraw any Purchase Notice or Change in
Control Purchase Notice, as the case may be, by delivering to the Paying Agent a
written notice of withdrawal within the times and otherwise in accordance with
the provisions of the Indenture.
If cash (and/or securities if permitted under the Indenture) sufficient
to pay the Purchase Price or Change in Control Purchase Price, as the case may
be, of all Securities or portions thereof to be purchased as of the Purchase
Date or the Change in Control Purchase Date, as the case may be, is deposited
with the Paying Agent on the Purchase Date or the Change in Control Purchase
Date, as the case may be, the Contingent Principal Amount shall cease to
increase, and contingent interest, if any, shall cease to accrue on such
Securities (or portions thereof) immediately after such Purchase Date or Change
in Control Purchase Date, as the case may be, and the Holder thereof shall have
no other rights as such (other than the right to receive the Purchase Price or
Change in Control Purchase Price, as the case may be, if any, upon surrender of
such Security).
A-6
8. Notice of Redemption.
--------------------
Notice of redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each Holder of Securities to be redeemed
at the Holder's registered address. If money sufficient to pay the Redemption
Price of all Securities (or portions thereof) to be redeemed on the Redemption
Date is deposited with the Paying Agent prior to or on the Redemption Date,
immediately after such Redemption Date, the Contingent Principal Amount shall
cease to increase, and contingent interest, if any, shall cease to accrue on
such Securities or portions thereof. Securities in denominations larger than
$1,000 of Original Principal Amount may be redeemed in part but only in integral
multiples of $1,000 of Original Principal Amount.
9. Conversion.
----------
Subject to the provisions of this paragraph 9 and the terms of the
Indenture and notwithstanding the fact that any other condition to conversion
has not been satisfied, Holders may surrender this Security for conversion into
shares of Common Stock at any time at their option until the close of business
on the Business Day immediately preceding March 13, 2032 if, as of the last day
of any calendar quarter beginning with the quarter ending on June 30, 2002, the
Sale Price of the Common Stock for at least 20 Trading Days in a period of 30
consecutive Trading Days ending on the last Trading Day of such quarter is more
than 120% of the accreted conversion price per share of Common Stock on the last
day of such quarter. Securities subject to conversion pursuant to the condition
to conversion contained in this paragraph will remain convertible
notwithstanding changes to the Sale Price of the Common Stock after such
Securities are deemed convertible.
The "accreted conversion price" per share of Common Stock as of any day
equals the quotient of:
o the Contingent Principal Amount of $1,000 Original Principal
Amount of Securities on that day, divided by
o the number of shares of Common Stock issuable upon conversion of
$1,000 Original Principal Amount of Securities on that day.
Subject to the provisions of this paragraph 9 and the Indenture and
notwithstanding the fact any other condition to conversion has not been
satisfied, Holders may convert the Securities into Common Stock on a Conversion
Date during any period in which the credit rating assigned to the Securities by
a Rating Agency is reduced to or below the Applicable Rating. "Rating Agency"
means (1) Xxxxx'x Investors Service, Inc. and its successors ("Moody's"), (2)
Standard & Poor's Credit Market Services, a division of The XxXxxx-Xxxx
Companies Inc., and its successors ("Standard & Poor's") and (3) Fitch, Inc.
("Fitch") and its successors. "Applicable Rating" means (1) Baa1, in the case of
Moody's (or its equivalent under any successor ratings categories of Moody's),
(2) BBB+, in the case of Standard & Poor's (or its equivalent under any
successor ratings categories of Standard & Poor's), (3) BBB+ in the case of
Fitch (or its equivalent under any successor ratings categories of Fitch) or (4)
the equivalent in respect of ratings categories of any Rating Agencies which are
successors to Moody's, Standard & Poor's or Fitch.
A-7
Subject to the provisions of this paragraph 9 and the Indenture and
notwithstanding the fact that any other condition to conversion has not been
satisfied, a Holder may convert into Common Stock a Security or portion of a
Security which has been called for redemption pursuant to paragraph 6 hereof,
even if the Security, or any portion thereof, is not subject to conversion by
the Holder, provided such Securities are surrendered for conversion prior to the
close of business on the second Business Day immediately preceding the
Redemption Date.
Subject to the provisions of this paragraph 9 and the Indenture and
notwithstanding the fact that any other condition to conversion has not been
satisfied, in the event that the Company declares a dividend or distribution
described in Section 11.07 of the Indenture, or a dividend or a distribution
described in Section 11.08 of the Indenture where the fair market value of such
dividend or distribution per share of Common Stock, as determined in the
Indenture, exceeds 15% of the Sale Price of the Common Stock on the Trading Day
immediately preceding the date of declaration for such dividend or distribution,
the Securities may be surrendered for conversion beginning on the date the
Company gives notice to the Holders of such right, which shall not be less than
20 days prior to the Ex-Dividend Time for such dividend or distribution, and
Securities may be surrendered for conversion at any time thereafter until the
close of business on the Business Day prior to the Ex-Dividend Time or until the
Company announces that such dividend or distribution will not take place. No
adjustment to the Conversion Rate or the ability of the Holders to convert this
Security will be made if the Company provides, as permitted in the Indenture,
for Holders to participate in the transaction without conversion or in other
cases specified in the Indenture.
Subject to the provisions of this paragraph 9 and the Indenture and
notwithstanding the fact that any other condition to conversion has not been
satisfied, in the event the Company is a party to a consolidation, merger or
binding share exchange pursuant to which the Common Stock would be converted
into cash, securities or other property as set forth in Section 11.14 of the
Indenture, the Securities may be surrendered for conversion at any time from and
after the date which is 15 days prior to the date of the anticipated effective
time of such transaction announced by the Company until 15 days after the actual
effective date of such transaction, and at the effective time of such
transaction the right to convert a Security into Common Stock will be deemed to
have changed into a right to convert it into the kind and amount of cash,
securities or other property which the holder would have received if the holder
had converted its Security immediately prior to the transaction.
A Security in respect of which a Holder has delivered a Purchase Notice
or Change in Control Purchase Notice exercising the option of such Holder to
require the Company to purchase such Security may be converted only if such
notice of exercise is withdrawn in accordance with the terms of the Indenture.
The initial Conversion Rate is 13.8213 shares of Common Stock per
$1,000 Original Principal Amount, subject to adjustment for certain events
described in the Indenture or this paragraph 9. The Company will deliver cash or
a check in lieu of any fractional share of Common Stock due to a Holder, taking
into account all Securities converted by a Holder at the same time.
A-8
Contingent interest, if any, will not be paid on Securities that are
converted; provided, however that Securities surrendered for conversion during
the period from the close of business on the applicable record date to the
opening of business on the date on which such contingent interest is payable
shall be entitled to receive such contingent interest payable on such Securities
on the date on which such contingent interest is payable and (except Securities
with respect to which the Company has mailed a notice of redemption) Securities
surrendered for conversion during such periods must be accompanied by payment of
an amount equal to the contingent interest with respect thereto that the
registered Holder is to receive.
To convert a Security, a Holder must (1) complete and manually sign the
conversion notice below (or complete and manually sign a facsimile of such
notice) and deliver such notice to the Conversion Agent, (2) surrender the
Security to the Conversion Agent, (3) furnish appropriate endorsements and
transfer documents if required by the Conversion Agent, the Company or the
Trustee and (4) pay any transfer or similar tax, if required.
A Holder may only convert a portion of a Security pursuant to the terms
of this paragraph 9 and in accordance with the Indenture if the Original
Principal Amount of such portion is $1,000 or an integral multiple of $1,000. No
payment or adjustment will be made for dividends on the Common Stock except as
provided herein and in the Indenture. On conversion of a Security, increases in
the Contingent Principal Amount attributable to the period from the Issue Date
through the Conversion Date, accrued Tax Original Issue Discount and (except as
provided above) accrued contingent interest with respect to the converted
Security shall not be cancelled, extinguished or forfeited, but rather shall be
deemed to be paid in full to the Holder thereof through the delivery of the
Common Stock (together with the cash payment, if any, in lieu of fractional
shares) in exchange for the Security being converted pursuant to the terms
hereof; and the fair market value of such shares of Common Stock (together with
any such cash payment in lieu of fractional shares) shall be treated as issued,
to the extent thereof, first in exchange for the increases in the Contingent
Principal Amount accrued through the Conversion Date, accrued Tax Original Issue
Discount and accrued contingent interest, and the balance, if any, of such fair
market value of such Common Stock (and any such cash payment) shall be treated
as issued in exchange for the Issue Price of the Security being converted
pursuant to the provisions hereof.
Pursuant to the terms and conditions of the Indenture, the Conversion
Rate will be adjusted for dividends or distributions on Common Stock payable in
Common Stock or other capital stock of the Company; subdivisions, combinations
or certain reclassifications of Common Stock; distributions to all holders of
Common Stock of certain rights to purchase Common Stock for a period expiring
within 60 days at less than the Sale Price of the Common Stock at the Time of
Determination; and distributions to such holders of assets or debt securities of
the Company or certain rights to purchase securities of the Company (excluding
certain cash dividends or distributions). However, no adjustment need be made if
Securityholders may participate in the transaction or in certain other cases.
The Company from time to time may voluntarily increase the Conversion Rate.
If the Company is a party to a consolidation, merger or binding share
exchange or a transfer of all or substantially all of its assets, or upon
certain distributions described in the
A-9
Indenture, the right to convert a Security into Common Stock may be changed into
a right to convert it into securities, cash or other assets of the Company or
another person.
The Conversion Rate will not be adjusted for increases in the
Contingent Principal Amount or any contingent interest.
10. [Reserved.]
11. Defaulted Interest.
------------------
Except as otherwise specified with respect to the Securities, any
contingent interest on any Security shall forthwith cease to be payable to the
registered Holder thereof on the relevant Regular Record Date or accrual date
for contingent interest, as the case may be, by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company as provided for
in Section 12.02 of the Indenture.
12. Denominations; Transfer; Exchange.
---------------------------------
The Securities are in fully registered form, without coupons, in
denominations of $1,000 of Original Principal Amount and integral multiples of
$1,000 Original Principal Amount. A Holder may transfer or exchange Securities
in accordance with the Indenture. The Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents and to
pay any taxes and fees required by law or permitted by the Indenture. The
Registrar need not transfer or exchange any Securities selected for redemption
(except, in the case of a Security to be redeemed in part, the portion of the
Security not to be redeemed) or any Securities in respect of which a Purchase
Notice or Change in Control Purchase Notice has been given and not withdrawn
(except, in the case of a Security to be purchased in part, the portion of the
Security not to be purchased) or any Securities for a period of 15 days before
the mailing of a notice of redemption of Securities to be redeemed.
13. Persons Deemed Owners.
---------------------
The registered Holder of this Security may be treated as the owner of
this Security for all purposes.
14. Unclaimed Money or Securities.
-----------------------------
The Trustee and the Paying Agent shall return to the Company upon
written request any money or securities held by them for the payment of any
amount with respect to the Securities that remains unclaimed for two years,
subject to applicable unclaimed property laws. After return to the Company,
Holders entitled to the money or securities must look to the Company for payment
as general creditors unless an applicable abandoned property law designates
another person.
A-10
15. Amendment; Waiver.
-----------------
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in aggregate Original Principal Amount of the
Securities at the time outstanding and (ii) certain Defaults may be waived with
the written consent of the Holders of a majority in aggregate Original Principal
Amount of the Securities at the time outstanding. Subject to certain exceptions
set forth in the Indenture, without the consent of any Securityholder, the
Company and the Trustee may amend the Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency, or to comply with Article 5 or
Section 11.14 of the Indenture, to secure the Company's obligations under this
Security or to add to the Company's covenants for the benefit of the
Securityholders or to surrender any right or power conferred, or to comply with
any requirement of the SEC in connection with the qualification of the Indenture
under the TIA, or as necessary in connection with the registration of the
Securities under the Securities Act.
16. Defaults and Remedies.
---------------------
If an Event of Default occurs and is continuing, the Trustee, or the
Holders of at least 25% in aggregate Original Principal Amount of the Securities
at the time outstanding, may declare all the Securities to be due and payable
immediately. Certain events of bankruptcy or insolvency are Events of Default
which will result in the Securities becoming due and payable immediately upon
the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities except
as provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security reasonably satisfactory
to it. Subject to certain limitations, Holders of a majority in aggregate
Original Principal Amount of the Securities at the time outstanding may direct
the Trustee in its exercise of any trust or power. The Trustee may withhold from
Securityholders notice of any continuing Default (except a Default in payment of
amounts specified in clause (i) or (ii) above) if it determines that withholding
notice is in their interests.
17. Trustee Dealings with the Company.
---------------------------------
Subject to certain limitations imposed by the TIA, the Trustee under
the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its respective Affiliates and may otherwise deal with
the Company or its respective Affiliates with the same rights it would have if
it were not Trustee.
18. No Recourse Against Others.
--------------------------
A director, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Securities.
A-11
19. Authentication.
--------------
This Security shall not be valid until an authorized signatory of the
Trustee manually signs the Trustee's Certificate of Authentication on the other
side of this Security.
20. Abbreviations.
-------------
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
22. GOVERNING LAW.
-------------
THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE AND THIS
SECURITY.
--------------------
The Company will furnish to any Securityholder upon written request and
without charge a copy of the Indenture.
Xxxxxxx Xxxxx & Co., Inc.
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Secretary
with a copy to:
Xxxxxxx Xxxxx & Co., Inc.
4 World Financial Center 18th Floor
New York, New York 10080
Attention: Treasurer
A-12
ASSIGNMENT FORM CONVERSION NOTICE
To assign this Security, fill in the form below: To convert this Security into Common Stock of the
Company, check the box: [ ]
I or we assign and transfer this Security to To convert only part of this Security, state the Original
Principal Amount to be converted (which must
___________________________________________ be $1,000 Original Principal Amount or an integral
multiple of $1,000 Original Principal Amount): $
___________________________________________ _________________________________________
(Insert assignee's Soc. Sec. or tax ID no.) If you want the stock certificate made out in another
person's name, fill in the form below:
___________________________________________
___________________________________________ _________________________________________
(Print or type assignee's name, address
and zip code)
_________________________________________
(Insert other person's Soc. Sec. or tax ID no.)
and irrevocably appint _________________
agent to transfer this Security on the books _________________________________________
of the Company. The agent may substitute
another to act for him.
_________________________________________
(Print or type other person's name, address and
zip code)
Date: ___________________________ Your
Signature: ____________________________*
(Sign exactly as your name appears on the
other side of this Security)
* Your signature must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Trustee, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Trustee in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
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