BJ SERVICES COMPANY
(a Delaware corporation)
Convertible Senior Notes due 2022
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INDENTURE
Dated as of April 24, 2002
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THE BANK OF NEW YORK
Trustee
Table of Contents
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Page
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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. Restricted Global Securities..........................................................14
Section 2.12. Transfer Restriction..................................................................15
Section 2.13. CUSIP Numbers.........................................................................21
ARTICLE III
REDEMPTION AND PURCHASES
Section 3.01. Right to Redeem; Notices to Trustee...................................................22
Section 3.02. Tax Event Redemption..................................................................22
Section 3.03. Selection of Securities to Be Redeemed................................................22
Section 3.04. Notice of Redemption..................................................................23
Section 3.05. Effect of Notice of Redemption........................................................24
Section 3.06. Deposit of Redemption Price...........................................................24
Section 3.07. Securities Redeemed in Part...........................................................24
Section 3.08. [Reserved]............................................................................24
Section 3.09. Purchase of Securities at the Option of the Holder....................................24
Section 3.10. Purchase of Securities at Option of the Holder upon Change in Control.................31
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Section 3.11. Effect of Purchase Notice or Change in Control Purchase Notice........................35
Section 3.12. Deposit of Purchase Price or Change in Control Purchase Price.........................36
Section 3.13. Securities Purchased in Part..........................................................36
Section 3.14. Covenant to Comply With Securities Laws Upon Purchase of Securities...................36
Section 3.15. Repayment to the Company..............................................................37
ARTICLE IV
COVENANTS
Section 4.01. Payment of Securities.................................................................37
Section 4.02. SEC Reports...........................................................................37
Section 4.03. Compliance Certificate; Notice of Defaults............................................38
Section 4.04. Further Instruments and Acts..........................................................38
Section 4.05. Maintenance of Office or Agency.......................................................38
ARTICLE V
SUCCESSOR CORPORATION
Section 5.01. When Company May Merge or Transfer Assets.............................................39
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.....................................................................40
Section 6.02. Acceleration..........................................................................42
Section 6.03. Other Remedies........................................................................42
Section 6.04. Waiver of Past Defaults...............................................................43
Section 6.05. Control by Majority...................................................................43
Section 6.06. Limitation on Suits...................................................................43
Section 6.07. Rights of Holders to Receive Payment..................................................44
Section 6.08. Collection Suit by Trustee............................................................44
Section 6.09. Trustee May File Proofs of Claim......................................................44
Section 6.10. Priorities............................................................................45
Section 6.11. Undertaking for Costs.................................................................45
Section 6.12. Waiver of Stay, Extension or Usury Laws...............................................45
ARTICLE VII
TRUSTEE
Section 7.01. Certain Duties and Responsibilities...................................................46
Section 7.02. Rights of Trustee.....................................................................47
Section 7.03. Individual Rights of Trustee..........................................................48
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Section 7.04. Trustee's Disclaimer..................................................................48
Section 7.05. Notice of Defaults....................................................................49
Section 7.06. Reports by Trustee to Holders.........................................................49
Section 7.07. Compensation and Indemnity............................................................49
Section 7.08. Replacement of Trustee................................................................50
Section 7.09. Successor Trustee by Merger...........................................................51
Section 7.10. Eligibility; Disqualification.........................................................51
Section 7.11. Preferential Collection of Claims Against Company.....................................51
ARTICLE VIII
DISCHARGE OF INDENTURE
Section 8.01. Discharge of Liability on Securities..................................................51
Section 8.02. Repayment to the Company..............................................................51
ARTICLE IX
AMENDMENTS
Section 9.01. Without Consent of Holders............................................................52
Section 9.02. With Consent of Holders...............................................................52
Section 9.03. Compliance with Trust Indenture Act...................................................53
Section 9.04. Revocation and Effect of Consents, Waivers and Actions................................53
Section 9.05. Notation on or Exchange of Securities.................................................53
Section 9.06. Trustee to Sign Supplemental Indentures...............................................54
Section 9.07. Effect of Supplemental Indentures.....................................................54
ARTICLE X
[RESERVED]
ARTICLE XI
CONVERSION
Section 11.01. Conversion Privilege..................................................................54
Section 11.02. Conversion Procedure..................................................................55
Section 11.03. Fractional Shares.....................................................................56
Section 11.04. Taxes on Conversion...................................................................56
Section 11.05. Company to Provide Stock..............................................................56
Section 11.06. Payment of Cash in Lieu of Common Stock...............................................57
Section 11.07. Adjustment for Change in Capital Stock................................................58
Section 11.08. Adjustment for Rights Issue...........................................................58
Section 11.09. Adjustment for Other Distributions....................................................59
Section 11.10. When Adjustment May Be Deferred.......................................................62
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Section 11.11. When No Adjustment Required...........................................................62
Section 11.12. Notice of Adjustment..................................................................62
Section 11.13. Voluntary Increase....................................................................63
Section 11.14. Notice of Certain Transactions........................................................63
Section 11.15. Reorganization of Company; Special Distributions......................................63
Section 11.16. Company Determination Final...........................................................64
Section 11.17. Trustee's Adjustment Disclaimer.......................................................64
Section 11.18. Simultaneous Adjustments..............................................................64
Section 11.19. Successive Adjustments................................................................65
Section 11.20. Rights Issued in Respect of Common Stock Issued Upon Conversion.......................65
ARTICLE XII
PAYMENT OF INTEREST
Section 12.01. Interest Payments.....................................................................65
Section 12.02. Defaulted Interest....................................................................65
Section 12.03. Interest Rights Preserved.............................................................66
ARTICLE XIII
MISCELLANEOUS
Section 13.01. Trust Indenture Act Controls..........................................................66
Section 13.02. Notices...............................................................................67
Section 13.03. Communication by Holders with Other Holders...........................................67
Section 13.04. Certificate and Opinion as to Conditions Precedent....................................67
Section 13.05. Statements Required in Certificate or Opinion.........................................68
Section 13.06. Separability Clause...................................................................68
Section 13.07. Rules By Trustee, Paying Agent, Conversion Agent and Registrar........................68
Section 13.08. Consent to Jurisdiction...............................................................68
Section 13.09. Governing Law.........................................................................69
Section 13.10. No Recourse Against Others............................................................69
Section 13.11. Successors............................................................................69
Section 13.12. Multiple Originals....................................................................69
Section 13.13. References............................................................................69
Section 13.14. Calculations..........................................................................69
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CROSS-REFERENCE TABLE*
TIA Indenture
Section Section
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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.
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INDENTURE, dated as of April 24, 2022, between BJ Services Company, a
Delaware corporation (the "Company"), and The Bank of New York, a banking
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corporation organized and existing under the laws of the State of New York, as
trustee (the "Trustee").
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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 Convertible Senior
Notes due 2022 (the "Securities"):
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions.
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"Accrued Original Issue Discount" of any Security represents the
accrued portion of the total Original Issue Discount. The total Original Issue
Discount is the excess of the Principal Amount per Security over the Issue
Price. Accrued Original Issue Discount will be calculated on a daily basis at
the yield of the Securities, on a semi-annual bond equivalent basis, using a
360-day year composed of twelve 30-day months, beginning on the Issue Date.
"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
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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
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meanings correlative to the foregoing.
"Applicable Procedures" means, with respect to any transfer or exchange
of beneficial ownership interests in a Global Security, the rules and procedures
of the Depositary that are applicable to such transfer or exchange.
"Average Sale Price" means the average of the Sale Prices of the Common
Stock for the shortest 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, and (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, that are not
Trading Days), and (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 11.07(d) or 11.08 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
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the Average Sale Price is being calculated (excluding days within such period,
if any, that 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 11.07(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 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, a Sunday or a day
on which banking institutions in The City of New York are authorized or required
by law, regulation or executive order to close.
"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.
"Certificated Security" means a Security that is in substantially the
form attached hereto as Annex A.
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"Common Stock" means the Common Stock, par value $0.10 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 Chief Executive Officer, its President, any Vice President or its
Treasurer, and by an Assistant Treasurer, its Secretary or an Assistant
Secretary, and delivered to the Trustee.
"Corporate Trust Office" means the principal office of the Trustee at
which at any time its corporate trust business shall be administered, which
office at the dated hereof is located at
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101 Barclay Street, Floor 21 West, New York, New York 10286, Attention:
Corporate Trust Department, or such other address as the Trustee may designate
from time to time by notice to the Holders and the Company, or the principal
corporate trust office of any successor Trustee (or such other address as such
successor Trustee may designate from time to time by notice to the Holders and
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 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.
"Designated Subsidiary" means any Subsidiary, existing or future, the
assets of which represents more than 15% of the total assets of the Company and
its Subsidiaries, which determination shall be based upon the most recent annual
or quarterly financial statements published by the Company.
"Global Security" means a permanent Global Security that is in
substantially the form attached hereto as Annex A.
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"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.
"Institutional Accredited Investors" means institutional accredited
investors as defined in Rule 501(a)(1), (2), (3) and (7) under the Securities
Act.
"Interest Payment Date" means April 24 and October 24 of each year,
commencing October 24, 2002.
"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.
3
"Issue Price" of any Security means, in connection with the original
issuance of such Security, the initial issue price at which the Security is sold
as set forth on the face of the Security.
"Market Price" means the average of the Sale Prices of the Common Stock
for the five Trading Day period ending on and including (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 11.07, 11.08 or 11.09 that would result
in an adjustment to the Conversion Rate; subject, however, to the conditions set
forth in Sections 11.10 and 11.11.
"Officer" means Chairman or Vice Chairman of the Board, the Chief
Executive Officer, 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 Chairman of the Board, or Vice Chairman, the President,
the Chief Executive Officer, 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 Issue Discount" of any Security means the difference between
the Issue Price and the Principal Amount of the Security 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
means the principal amount due at the Stated Maturity of the Security as set
forth on the face of the Security.
"QIB" has the meaning specified in Section 2.11.
"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.
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"Redemption Price" or "redemption price" shall have the meaning set
forth in paragraph 5 of the Securities.
"Restricted Certificated Security" means a Certificated Security which
is a Transfer Restricted Security.
"Restricted Global Security" means a Global Security that is a Transfer
Restricted Security.
"Rights" means the preferred stock purchase rights issued pursuant to
the Amended and Restated Stockholder Rights Agreement of the Company, as amended
or restated from time to time.
"Rule 144" means Rule 144 under the Securities Act or any successor to
such Rule.
"Rule 144A" means Rule 144A under the Securities Act or any successor
to such Rule.
"Sale Price" of a single share of Common Stock on any Trading Day means
the closing per share sale price for the Common Stock (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 is listed for trading or,
if the Common Stock is not listed for trading 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 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 Convertible Senior Notes due
2022, 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 Principal
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.
5
"Tax Event" means the receipt by the Company of an opinion of
nationally recognized tax counsel experienced in such matters to the effect that
there is more than an insubstantial risk that interest and Original Issue
Discount payable by the Company on the Securities on the next date on which
interest and Original Issue Discount is due would not be deductible, in whole or
in part, by the Company for United States federal income tax purposes as a
result of (a) any amendment to, change in, or announced proposed change in, the
laws, or any regulations thereunder, of the United States or any political
subdivision or taxing authority thereof or therein affecting taxation, (b) any
amendment to or change in an official interpretation or application of any such
law or regulations by any legislative body, court, governmental agency or
regulatory authority or (c) any official interpretation or pronouncement that
provides for a position with respect to any such laws or regulations that
differs from the generally accepted position on the date of the offering
memorandum, which amendment, change, or proposed change is effective or which
interpretation or pronouncement is announced on or after the date of the first
issuance of Securities under this Indenture.
"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.
"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 for
trading on The New York Stock Exchange, on the principal other national or
regional securities exchange on which the Common Stock is then listed for
trading or, if the Common Stock is not listed for trading 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.
"Transfer Certificate" has the meaning specified in Section 2.12(b)(1).
"Transfer Restricted Securities" has the meaning specified in Section
2.12(f)(1).
"Trust Officer" means, when used with respect to the Trustee, any
officer within the corporate trust department of the Trustee, including any vice
president, assistant vice president, assistant secretary, assistant treasurer,
trust officer or any other officer of the Trustee who customarily performs
functions similar to those performed by the Persons who at the time shall be
such officers, respectively, or to whom any corporate trust matter is referred
because of such person's knowledge of and familiarity with the particular
subject and who shall have direct responsibility for the administration of this
Indenture.
"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.
"Unrestricted Certificated Security" means a Certificated Security
which is not a Transfer Restricted Security.
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"Unrestricted Global Security" means a Global Security which is not a
Transfer Restricted Security.
Section 1.02. Other Definitions.
-----------------
Defined in
Term Section
- ------------------------------------------------------------------------------------------------ ----------------
"Associate" 3.10(a)
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"Bankruptcy Law" 6.01
--------------
"Change in Control" 3.10(a)
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"Change in Control Purchase Date" 3.10(a)
-------------------------------
"Change in Control Purchase Notice" 3.10(c)
---------------------------------
"Change in Control Purchase Price" 3.10(a)
--------------------------------
"Company Notice" 3.09(e)
--------------
"Company Notice Date" 3.09(e)
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"Conversion Agent" 2.03
----------------
"Conversion Date" 11.02
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"Conversion Rate" 11.01
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"Defaulted Interest" 12.02
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"DTC" 2.03
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"Event of Default" 6.01
----------------
"Exchange Act" 3.09(d)
------------
"Ex-Dividend Measurement Period" 11.09
"Ex-Dividend Time" 11.01
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"Extraordinary Cash Dividend" 11.09
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"Notice of Default" 6.01
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"Paying Agent" 2.03
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"Purchase Date" 3.09(a)
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"Purchase Notice" 3.09(a)
---------------
"Purchase Price" 3.09(a)
--------------
"Registrar" 2.03
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"Regular Record Date" 12.01
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"Securities Act" 3.09(d)
--------------
"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.
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"indenture securities" means the Securities.
--------------------
"indenture security holder" means a Securityholder.
-------------------------
"indenture to be qualified" means this Indenture.
-------------------------
"indenture trustee" or "institutional trustee" means the Trustee.
----------------- ---------------------
7
"obligor" on the indenture securities means the Company.
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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.
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(a) Any request, demand, authorization, direction,
notice, consent, waiver or other action provided by this Indenture to
be given or taken by Holders may be embodied in and evidenced by one
or more instruments of substantially similar tenor signed by such
Holders in person or by 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 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.
8
(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 forms of
Annex 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 2.12.
Section 2.02. Execution and Authentication. The Securities shall be
----------------------------
executed by the Company by any one of its Chairman or Vice Chairman
of the Board, its Chief Executive Officer, 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 Principal Amount of $516,350,000 upon a Company Order
without any further action by the Company. The aggregate Principal Amount of
Securities outstanding at any time may not exceed the amount set forth in the
foregoing sentence, 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 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.
--------------------------------------------------
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 April 1 and October 1 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 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).
11
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denomination or denominations, of a like aggregate
Principal Amount, 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 2.12 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 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 or
redeemed 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.
12
Every new Security issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all benefits of this Indenture equally and proportionately with any
and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities.
Section 2.08. 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 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 and/or cash sufficient to
pay the Securities payable on that date, then on and after that date such
Securities shall cease to be outstanding and Original Issue Discount and
interest 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.
13
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
Original Issue Discount and interest 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
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 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. Restricted Global Securities. All of the Securities
----------------------------
are initially being offered and sold to qualified institutional buyers as
defined in Rule 144A (collectively, "QIBs" or individually a "QIB") in reliance
on Rule 144A under the Securities Act and shall be issued initially in the form
of one or more Restricted Global Securities, which shall be deposited on behalf
of the purchasers of the Securities represented thereby with the Trustee, at
its Corporate Trust Office, as custodian for DTC, and registered in the name of
its nominee, Cede & Co., duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The aggregate Principal Amount of a Restricted
Global Security may from time to time be increased or decreased by adjustments
made on the records of the Trustee as hereinafter provided, subject in each
case to compliance with the Applicable Procedures.
14
Section 2.12. Transfer Restriction.
--------------------
(a) Transfer and Exchange of Global Securities.
------------------------------------------
(1) Except as provided in Section 2.12(b),
Certificated Securities shall be issued in exchange for
interests in the Global Securities only if (x) the
Depositary notifies the Company that it is unwilling or
unable to continue as depositary for the Global Securities
or if it at any time ceases to be a "clearing agency"
registered under the Exchange Act if so required by
applicable law or regulation and a successor depositary is
not appointed by the Company within 60 days, (y) an Event
of Default with respect to the Securities has occurred and
is continuing or (z) the Company executes and delivers to
the Trustee a Company Order to the effect that the Global
Securities shall be exchangeable. In each case, the
Company shall execute, and the Trustee shall, upon receipt
of a Company Order (which the Company agrees to deliver
promptly), authenticate and deliver Certificated
Securities in an aggregate Principal Amount equal to the
Principal Amount of such Global Securities in exchange
therefor. Only Restricted Certificated Securities shall be
issued in exchange for beneficial interests in Restricted
Global Securities, and only Unrestricted Certificated
Securities shall be issued in exchange for beneficial
interests in Unrestricted Global Securities. Certificated
Securities issued in exchange for beneficial interests in
Global Securities shall be registered in such names and
shall be in such authorized denominations as the
Depositary, pursuant to instructions from its direct or
indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver or cause to be
delivered such Certificated Securities to the persons in
whose names such Securities are so registered. Such
exchange shall be effected in accordance with the
Applicable Procedures. Nothing herein shall require the
Trustee to communicate directly with beneficial owners,
and the Trustee shall in connection with any transfers
hereunder be entitled to rely on instructions received
through the registered Holder.
In the event that Certificated Securities are issued
in exchange for beneficial interests in Global Securities in
accordance with the foregoing paragraph and, thereafter, the
events or conditions specified in this Section 2.12(a)(1)
which required such exchange shall have ceased to exist, the
Company shall mail notice to the Trustee and to the Holders
stating that Holders may exchange Certificated Securities for
interests in Global Securities by complying with the
procedures set forth in this Indenture and briefly describing
such procedures and the events or circumstances requiring that
such notice be given.
(2) Notwithstanding any other provisions of this
Indenture other than the provisions set forth in Section
2.12(a)(1) hereof, a 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
15
Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor
Depositary. Nothing in this Section 2.12(a)(2) shall
prohibit or render ineffective any transfer of a
beneficial interest in a Global Security effected in
accordance with the other provisions of this Section 2.12.
(b) Restrictions on Transfer of a Beneficial Interest in
----------------------------------------------------
a Global Security for a Certificated Security. A beneficial
---------------------------------------------
interest in a Global Security may not be exchanged for a
Certificated Security except upon satisfaction of the requirements
set forth below. Upon receipt by the Trustee of a request in the
form satisfactory to the Trustee from the Depositary or its nominee
on behalf of a person having a beneficial interest in a Global
Security to register the transfer of all or a portion of such
beneficial interest in accordance with Applicable Procedures for a
Certificated Security, together with:
(1) in the case of a request to register the
transfer of a beneficial interest in a Restricted Global
Security, a certificate (a "Transfer Certificate"), in
substantially the form set forth in Exhibit B-1, and a
certification in substantially the form set forth in
Exhibit B-2, that such beneficial interest in the
Restricted Global Security is being transferred to an
Institutional Accredited Investor;
(2) written instructions to the Trustee to make,
or direct the Registrar to make, an adjustment on its
books and records with respect to such Global Security to
reflect a decrease in the aggregate Principal Amount of
the Securities represented by the Global Security, such
instructions to contain information regarding the
Depositary account to be credited with such decrease; and
(3) if the Company or the Trustee so requests,
an Opinion of Counsel, certificates and other information
reasonably acceptable to them as to the compliance with
the restrictions set forth in the legend described in
Section 2.12(f)(1),
then the Trustee shall cause, or direct the Registrar to
cause, in accordance with the standing instructions and procedures
existing between the Depositary and the Registrar, the aggregate
Principal Amount represented by the Global Security to be decreased by
the aggregate Principal Amount of the Certificated Security to be
issued, shall authenticate and deliver such Certificated Security and
shall debit or cause to be debited to the account of the Person
specified in such instructions a beneficial interest in the Global
Security equal to the Principal Amount of the Certificated Security so
issued.
(c) Transfer and Exchange of Certificated Securities.
-------------------------------------------------
When Certificated Securities are presented by a Holder to a Registrar
with a request:
(1) to register the transfer of the Certificated
Securities to a person who will take delivery thereof in the
form of Certificated Securities only; or
16
(2) to exchange such Certificated Securities
for an equal Principal Amount of Certificated Securities
of other authorized denominations,
such Registrar shall register the transfer or make the
exchange as requested; provided, however, that the Certificated
Securities presented or surrendered for register of transfer or
exchange:
(1) shall be duly endorsed or accompanied by a
written instrument of transfer in accordance with Section 2.06
herein; and
(2) in the case of a Restricted Certificated
Security, such request shall be accompanied by the following
additional information and documents, as applicable:
(A) if such Restricted Certificated
Security is being delivered to the Registrar by a
Holder for registration in the name of such Holder,
without transfer, or such Restricted Certificated
Security is being transferred to the Company or a
Subsidiary of the Company, a certification to that
effect from such Holder (in substantially the form
set forth in the Transfer Certificate)
(B) if such Restricted Certificated
Security is being transferred to a person the Holder
reasonably believes is a QIB in accordance with Rule
144A or pursuant to an effective registration
statement under the Securities Act, a certification
to that effect from such Holder (in substantially the
form set forth in the Transfer Certificate); or
(C) if such Restricted Certificated
Security is being transferred to an Institutional
Accredited Investor, a certification to that effect
from such Holder (in substantially the form set
forth in the Transfer Certificate), a certification
from the Institutional Accredited Investor to whom
such Restricted Certificated Security is being
transferred in substantially the form set forth in
Exhibit B-2, and, if the Company or such Registrar
so requests, an Opinion of Counsel, certificates and
other information reasonably acceptable to them as
to the compliance with the restrictions set forth in
the legend described in Section 2.12(f)(1).
(D) if such Restricted Certificated
Security is being transferred (i) pursuant to
an exemption from the registration requirements
of the Securities Act in accordance with Rule 144
or (ii) pursuant to an exemption from the
registration requirements of the Securities Act
(other than pursuant to Rule 144A or Rule 144) and
as a result of which, in the case of a Security
transferred pursuant to this clause (ii), such
Security shall cease to be a "restricted security"
within the meaning of Rule 144, a certification to
that effect from the Holder (in substantially the
form set
17
forth in the Transfer Certificate) and, if the
Company or such Registrar so requests, an Opinion
of Counsel, certificates and other information
reasonably acceptable to the Company and such
Registrar to the effect that such transfer is in
compliance with the Securities Act.
(d) Transfer of a Beneficial Interest in a Restricted
-------------------------------------------------
Global Security for a Beneficial Interest in an Unrestricted Global
-------------------------------------------------------------------
Security. Any person having a beneficial interest in a
--------
Restricted Global Security may upon request, subject to the
Applicable Procedures, transfer such beneficial interest to a person
who is required or permitted to take delivery thereof in the form of
an Unrestricted Global Security. Upon receipt by the Trustee of
written instructions or such other form of instructions as is
customary for the Depositary, from the Depositary or its nominee
on behalf of any person having a beneficial interest in a Restricted
Global Security and the following additional information and
documents in such form as is customary for the Depositary from the
Depositary or its nominee on behalf of the person having such
beneficial interest in the Restricted Global Security (all of which
may be submitted by facsimile or electronically):
(1) if such beneficial interest is being
transferred pursuant to an effective registration statement
under the Securities Act, a certification to that effect from
the transferor (in substantially the form set forth in the
Transfer Certificate); or
(2) if such beneficial interest is being
transferred (i) pursuant to an exemption from the
registration requirements of the Securities Act in
accordance with Rule 144 or (ii) pursuant to an exemption
from the registration requirements of the Securities
Act (other than pursuant to Rule 144A or Rule 144) and as
a result of which, in the case of a Security transferred
pursuant to this clause (ii), such Security shall cease to
be a "restricted security" within the meaning of Rule 144,
a certification to that effect from the transferor (in
substantially the form set forth in the Transfer Certificate)
and, if the Company or the Trustee so requests, an Opinion of
Counsel, certificates and other information reasonably
acceptable to the Company and the Trustee to the effect
that such transfer is in compliance with the Securities Act,
the Trustee, as a Registrar and Securities Custodian, shall reduce or
cause to be reduced the aggregate Principal Amount of the Restricted
Global Security by the appropriate Principal Amount and shall increase
or cause to be increased the aggregate Principal Amount of the
Unrestricted Global Security by a like Principal Amount. Such transfer
shall otherwise be effected in accordance with the Applicable
Procedures. If no Unrestricted Global Security is then outstanding,
the Company shall execute and the Trustee shall, upon receipt of a
Company Order (which the Company agrees to deliver promptly),
authenticate and deliver an Unrestricted Global Security.
18
(e) Transfers of Certificated Securities for Beneficial
-----------------------------------------------------
Interest in Global Securities. If Certificated Securities are presented
-----------------------------
by a Holder to a Registrar with a request:
(1) to register the transfer of such
Certificated Securities to a person who will take delivery
thereof in the form of a beneficial interest in a Global
Security, which request shall specify whether such Global
Security will be a Restricted Global Security or an
Unrestricted Global Security; or
(2) to exchange such Certificated Securities for
an equal Principal Amount of beneficial interests in a Global
Security, which beneficial interests will be owned by the
Holder transferring such Certificated Securities (provided
that in the case of such an exchange, Restricted
Certificated Securities may be exchanged only for Restricted
Global Securities and Unrestricted Certificated Securities
may be exchanged only for Unrestricted Global Securities),
the Registrar shall register the transfer or make the exchange as
requested by canceling such Certificated Security and causing, or
directing the Securities Custodian to cause, the aggregate Principal
Amount of the applicable Global Security to be increased accordingly
and, if no such Global Security is then outstanding, the Company shall
issue and the Trustee shall authenticate and deliver a new Global
Security; provided, however, that the Certificated Securities presented
or surrendered for registration of transfer or exchange:
(1) shall be duly endorsed or accompanied by a
written instrument of transfer in accordance with Section
2.06 herein;
(2) in the case of a Restricted Certificated
Security to be transferred for a beneficial interest in an
Unrestricted Global Security, such request shall be
accompanied by the following additional information and
documents, as applicable:
(A) if such Restricted Certificated
Security is being transferred pursuant to an
effective registration statement under the
Securities Act, a certification to that effect from
such Holder (in substantially the form set forth in
the Transfer Certificate); or
(B) if such Restricted Certificated
Security is being transferred pursuant to
(i) an exemption from the registration
requirements of the Securities Act in accordance
with Rule 144 or (ii) pursuant to an exemption from
the registration requirements of the Securities
Act (other than pursuant to Rule 144A or Rule 144)
and as a result of which, in the case of a Security
transferred pursuant to this clause (ii), such
Security shall cease to be a "restricted security"
within the meaning of Rule 144, a certification
to that effect from such Holder (in substantially
the form set forth in the Transfer Certificate),
and, if the Company or the Registrar so
19
requests, an Opinion of Counsel, certificates and
other information reasonably acceptable to the
Company and the Trustee to the effect that such
transfer is in compliance with the Securities Act;
(3) in the case of a Restricted Certificated
Security to be transferred or exchanged for a beneficial
interest in a Restricted Global Security, such request shall
be accompanied by a certification from such Holder (in
substantially the form set forth in the Transfer
Certificate) to the effect that such Restricted Certificated
Security is being transferred to a person the Holder
reasonably believes is a QIB (which, in the case of an
exchange, shall be such Holder) in accordance with Rule
144A; and
(4) in the case of an Unrestricted Certificated
Security to be transferred or exchanged for a beneficial
interest in an Unrestricted Global Security, such request
need not be accompanied by any additional information or
documents.
(f) Legends.
-------
(1) Except as permitted by the following
paragraphs (2) and (3), each Global Security and
Certificated Security (and all Securities issued in exchange
therefor or upon registration of transfer or replacement
thereof and any Common Stock issuable upon conversion
thereof) shall bear a legend in substantially the form
called for by footnote 2 to Annex A hereto (each a "Transfer
-------
Restricted Security" for so long as such Security or Common
Stock issuable upon conversion thereof is required by this
Indenture to bear such legend). Each Transfer Restricted
Security shall have attached thereto a Transfer Certificate
in substantially the form set forth in Exhibit B-1 hereto.
-----------
(2) Upon any sale or transfer of a Transfer
Restricted Security (x) pursuant to Rule 144, (y) pursuant
to an effective registration statement under the Securities
Act or (z) pursuant to any other available exemption (other
than Rule 144A) from the registration requirements of the
Securities Act and as a result of which, in the case of a
Security transferred pursuant to this clause (z), such
Security shall cease to be a "restricted security" within
the meaning of Rule 144:
(A) in the case of any Restricted
Certificated Security, any Registrar shall permit
the Holder thereof to exchange such Restricted
Certificated Security for an Unrestricted
Certificated Security, or (under the circumstances
described in Section 2.12(e) hereof) to transfer
such Restricted Certificated Security to a
transferee who shall take such Security in the form
of a beneficial interest in an Unrestricted Global
Security, and in each case shall rescind any
restriction on the transfer of such Security;
provided, however, that the Holder of such
Restricted
20
Certificated Security shall, in connection with such
exchange or transfer, comply with the other
applicable provisions of this Section 2.12; and
(B) in the case of any beneficial interest
in a Restricted Global Security, the Trustee shall
permit the beneficial owner thereof to transfer such
beneficial interest to a transferee who shall take
such interest in the form of a beneficial interest in
an Unrestricted Global Security and shall rescind any
restriction on transfer of such beneficial interest;
provided, however, that such Unrestricted Global
Security shall continue to be subject to the
provisions of Section 2.12(a)(2) hereof, and provided
further, however, that the owner of such beneficial
interest shall, in connection with such transfer,
comply with the other applicable provisions of this
Section 2.12.
(3) Upon the exchange, registration of transfer
or replacement of Securities not bearing the legend described
in paragraph (1) above, the Company shall execute, the
Trustee shall authenticate and deliver Securities that do not
bear such legend and which do not have a Transfer Certificate
attached thereto.
(g) Transfers to the Company. Nothing in this Indenture
------------------------
or in the Securities shall prohibit the sale or other transfer of any
Securities (including beneficial interests in Global Securities) to the
Company or any of its Subsidiaries, which Securities shall thereupon be
canceled in accordance Section 2.10 of the Indenture.
(h) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with
respect to any transfer of any interest in any Security (including any
transfers between or among Depositary Participants or beneficial owners
of interests in any Global Security) other than to require delivery of
such certificates and other documentation or evidence as are expressly
required by, and to do so if and when expressly required by the terms
of, this Indenture, and to examine the same to determine substantial
compliance as to form with the express requirements hereof.
Section 2.13. 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.
21
ARTICLE III
REDEMPTION AND PURCHASES
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 5 and 7 of the Securities. If the Company
elects to redeem Securities pursuant to paragraph 5 of the Securities, it shall
notify the Trustee in writing of the Redemption Date, the Principal Amount 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 30 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. Tax Event Redemption.
--------------------
If a Tax Event shall occur and be continuing, the Company may, at its
option, redeem the Securities in whole (but not in part) at any time at a price
per Security equal to the Issue Price plus Accrued Original Issue Discount and
accrued and unpaid interest to, but excluding, the date of redemption (the "Tax
Event Redemption Date"). Interest on the Securities which is due and payable on
or prior to the Tax Event Redemption Date will be payable to the Holders of the
Securities registered as such at the close of business on the Regular Record
Date. If, following the occurrence of a Tax Event, the Company exercises its
option to redeem the Securities, the Company will inform the Holders of the
Company's election to redeem the Securities by forwarding a notice of
redemption. Notice of any redemption will be mailed at least 30 days but not
more than 60 days before the Tax Event Redemption Date to each registered Holder
of the Securities to be repaid at its registered address. Unless the Company
defaults in payment of the Redemption Price, on and after the Tax Event
Redemption Date interest shall cease to accrue on the Securities.
Section 3.03. 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 Principal Amount of Securities that have
denominations larger than $1,000.
Securities and any portions thereof that the Trustee selects shall be
in 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
22
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 3.03 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 3.04. 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;
(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 to Common Stock 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 to
Common Stock must satisfy the requirements set forth in paragraph
8 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 Principal Amounts
of the particular Securities to be redeemed;
(i) that, unless the Company defaults in its obligation
to make payment of such Redemption Price on Securities called for
redemption, Original Issue Discount and interest will cease to accrue
on and after the Redemption Date; and
23
(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 3.05. 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 Price stated in the notice.
Section 3.06. 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 to Common Stock. The Paying
Agent shall as promptly as practicable return to the Company any money not
required for that purpose because of conversion of Securities and/or Common
Stock pursuant to Article 11. If such money and/or Common Stock 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 3.07. Securities Redeemed in Part. Upon surrender of a Security
---------------------------
that is redeemed in part, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder a new Security in an authorized
denomination equal in Principal Amount to the unredeemed portion of the
Security surrendered.
Section 3.08. [Reserved].
----------
Section 3.09. Purchase of Securities at the Option of the Holder. (a)
--------------------------------------------------
General. If a Holder exercises its right as provided under this Section 3.09
- -------
to require the Company to repurchase the Securities, the Securities shall be
purchased by the Company on April 24, 2005, April 24, 2007, April 24, 2012, and
April 24, 2017 (each, a "Purchase Date"), at the purchase price of:
. $817.99 per $1,000 of Principal Amount on April 24, 2005;
. $836.90 per $1000 of Principal Amount on April 24, 2007;
. $886.93 per $1,000 of Principal Amount on April 24, 2012; and
. $941.18 per $1,000 of Principal Amount on April 24, 2017;
(each, a "Purchase Price", as applicable), plus, in each case,
accrued and unpaid interest to, but excluding, the Purchase
Date, at the option of the Holder thereof, upon:
24
(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 each Security
which the Holder will deliver to be purchased,
(B) the portion of the Principal Amount of each
Security which the Holder will deliver to be purchased,
which portion must be a 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 3.09(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
3.09(d), whether such Holder elects (i) to withdraw
such Purchase Notice as to some or all of the
Securities to which such Purchase Notice relates
(stating the Principal Amount and certificate numbers
of the Securities as to which such withdrawal shall
relate), or (ii) to receive cash in respect of the
entire Purchase Price for all Securities (or portions
thereof) to which such Purchase Notice relates; and
(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
3.09 only if the Security so delivered to the Paying Agent
shall conform in all respects to the description thereof in
the related Purchase Notice, as determined by the Company.
If a Holder, in such Holder's Purchase Notice and in any written notice
of withdrawal delivered by such Holder pursuant to the terms of Section 3.11,
fails to indicate such Holder's choice with respect to the election set forth in
clause (D) of Section 3.09(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 3.09, a portion of a Security if the Principal Amount of such portion is
$1,000 or an integral multiple of
25
$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
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 3.09(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 3.11.
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 3.09(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 3.09(c) and (d). The Company shall
designate, in the Company Notice delivered pursuant to Section
3.09(e), whether the Company will purchase the Securities on such
Purchase Date for cash or Common Stock, or, if a combination thereof,
(i) the percentages of the Purchase Price of Securities in respect of
which it will pay in cash or Common Stock or (ii) the amount of cash
to be included in such combination; provided that the Company will
--------
pay cash for fractional interests in Common Stock. Each Holder whose
Securities are purchased pursuant to this Section 3.09 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
3.09(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 3.09(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 3.09(b) or
pursuant to Section 3.09(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,
26
(ii) the information required by Section 3.09(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 3.09(d) have been or will be
complied with, and
(iv) whether the Company desires the Trustee to
give the Company Notice required by Section 3.09(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 3.09(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 3.09(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. For purposes of determining the
existence of potential fractional interests, all Securities subject to purchase
by the Company held by a Holder shall be considered together (no matter how many
separate certificates are to be presented).
Upon a payment by Common Stock pursuant to the terms hereof, that
portion of Accrued 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 the Accrued Original Issue Discount 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 3.09(e), shall be sent to the Holders (and to beneficial
owners as required by applicable law) not later than the Company Notice Date.
27
The Company's right to exercise its election to purchase any Securities
on a Purchase Date pursuant to Section 3.09 through the issuance of shares of
Common Stock shall be conditioned upon the following having been satisfied on or
before the Purchase Date:
(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 to be issued in payment
for all or a specified portion of the Purchase Price in
respect of Securities 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 for trading 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 all or the specified
portion 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 all or the
specified portion 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 all or the specified portion 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 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 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 Principal Amount of Securities and the
Sale Price of a share of
28
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
3.09 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 in the manner provided in Section 13.02 (the
"Company Notice"). The Company Notice shall be sent to the Holders
--------------
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 interest 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 or the
Specified Cash Amount (hereafter defined);
29
(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 3.09 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 8 of the Securities;
(ix) the procedures for withdrawing a Purchase
Notice (including, without limitation, for a conditional
withdrawal pursuant to the terms of Section 3.09(a)(1)(D)
or Section 3.11);
(x) that, unless the Company defaults in
making payment of such Purchase Price on Securities
surrendered for purchase, Original Issue Discount and
interest 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.
Upon determination of the actual number of shares of Common Stock to be
issued for each $1,000 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.
30
(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 Stockholder
Rights Agreement equally with other shares of Common Stock.
The Company shall use its reasonable commercial 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 or of any
delisting of any shares of Common Stock.
(g) Procedure upon Purchase. On or before the Purchase
-----------------------
Date, the Company shall deposit cash (in respect of a cash purchase
under Section 3.09(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 3.12, sufficient to
pay the aggregate Purchase Price of all Securities to be purchased
pursuant to this Section 3.09. 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
3.09(c), 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.
Section 3.10. Purchase of Securities at Option of the Holder upon
---------------------------------------------------
Change in Control.
-----------------
(a) If on or prior to April 24, 2005 there shall have
occurred a Change in Control, Securities shall be purchased by the
Company, at the option of the Holder thereof, at a purchase price
specified in paragraph 6 of the Securities (the "Change in Control
Purchase Price"), as of the date that is no later than 35 Business
Days after the
31
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 3.10(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 more than 50% 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 3.10, 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.
(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
32
Trustee and to
each Holder. 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 3.10 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 3.10 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, Original Issue Discount and
interest will cease to accrue on and after the Change in
Control Purchase Date; and
33
(14) the CUSIP number of the Securities.
(c) A Holder may exercise its rights specified in Section
3.10(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 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 each such Security shall be purchased pursuant
to the terms and conditions specified in the Securities.
The delivery of each 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 3.10
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 3.10, a portion of a Security if the 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 3.10 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 3.10.
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 3.10(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 3.11.
34
The Paying Agent shall promptly notify the Company of the receipt by it
of any Change in Control Purchase Notice or written withdrawal thereof.
Section 3.11. 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 3.09(a) or Section 3.10(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, to the extent accrued on 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 3.09(a) or Section 3.10(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 3.09(a) or Section
3.10(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 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 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
3.09(a)(1)(D) or (ii) a conditional withdrawal
35
containing the information set forth in Section 3.09(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 3.09
(other than through the issuance of Common Stock in payment of the Purchase
Price, including cash in lieu of fractional shares) or 3.10 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 3.12. 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, Original Issue Discount, and
interest shall cease to accrue on such Security, whether or not such Security
is delivered to the Paying Agent.
Section 3.13. 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 Principal
Amount equal to, and in exchange for, the portion of the Principal Amount of the
Security so surrendered which is not purchased.
Section 3.14. Covenant to Comply With Securities Laws Upon Purchase of
--------------------------------------------------------
Securities. In connection with any offer to purchase or purchase of Securities
- ----------
under Section 3.09 or 3.10 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
36
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 3.09 and 3.10 to be exercised in the time and in
the manner specified in Sections 3.09 and 3.10.
Section 3.15. 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 3.12 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 cash or shares of Common Stock to the Company (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. Principal Amount,
Issue Price, Accrued Original Issue Discount, Redemption Price, Purchase Price,
Change in Control Purchase Price and interest 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
37
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.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
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 September 30, 2002) 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 Corporate Trust Office of
the Trustee in The City of New York 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
38
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.
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
39
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.
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 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 interest,
when the same becomes due and payable, 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
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 fails to pay when due at maturity, or a
default that results in the acceleration of maturity of, any
indebtedness for borrowed money of the Company or its Subsidiaries in
an aggregate amount of $50 million or more, unless the acceleration
is rescinded, stayed or annulled within 30 days after written Notice
of Default is given to the Company by the Trustee or holders of not
less than 25% in aggregate Principal Amount of the Securities then
outstanding; or
(e) (i) the Company or any (ii) Designated Subsidiary or
(iii) any group of two or more Subsidiaries that, taken as a whole,
would constitute a Designated Subsidiary, pursuant to or under or
within the meaning of any Bankruptcy Law:
(1) commences a voluntary case or proceeding;
40
(2) consents to the (A) entry of an order for relief
against it in an involuntary case or proceeding or the (B)
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;
provided, however, that in the case of clause (iii) relating to a group
of Subsidiaries which would constitute a Designated Subsidiary, the
actions described in the foregoing clauses 1 through 6, inclusive, are
taken by such Subsidiaries at the same time or within the same 90 day
period; or
(f) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(1) is for relief against the Company or any Designated
Subsidiary or any group of two or more Subsidiaries that,
taken as a whole, would constitute a Designated Subsidiary,
in an involuntary case or proceeding, or adjudicates the
Company or any Designated Subsidiary insolvent or bankrupt;
(2) appoints a Custodian of the Company or any
Designated Subsidiary or any group of two or more
Subsidiaries that, taken as a whole, would constitute a
Designated Subsidiary, for any substantial part of its
property; or
(3) orders the winding up or liquidation of the Company
or any Designated Subsidiary or any group of two or more
Subsidiaries that, taken as a whole, would constitute a
Designated Subsidiary;
and the order or decree remains unstayed and in effect for 60 days;
provided, however, that in the case of any group of two or more such
Subsidiaries which would constitute a Designated Subsidiary, any such
order or decree is entered with respect to such Subsidiaries forming
such group at the same time or within the same 90 day period.
"Bankruptcy Law" means Title 11, United States Code, or any
similar Federal or state law for the relief of debtors.
41
"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 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(e) or (f)) occurs and is continuing, the
Trustee by Notice to the Company or the Holders of at least 25% in aggregate
Principal Amount of the Securities at the time outstanding by notice to the
Company and the Trustee, may declare the Issue Price plus Accrued Original
Issue Discount through the date of such declaration, and any accrued and unpaid
interest through the date of such declaration, on all the Securities to be
immediately due and payable. Upon such a declaration, such Issue Price plus
Accrued Original Issue Discount, and such accrued and unpaid interest shall be
due and payable immediately. If an Event of Default specified in Section
6.01(e) or (f) occurs and is continuing, the Issue Price plus Accrued Original
Issue Discount, and any accrued and unpaid 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
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 Issue Price plus Accrued Original Issue
Discount and any accrued and unpaid 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 Issue Price plus Accrued Original Issue Discount on the Securities or to
enforce the performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if the Trustee does not
possess any of the Securities or does not produce any of the Securities in the
proceeding. A delay or omission by the Trustee or any Securityholder in
exercising any right or remedy accruing upon an Event of
42
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 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 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 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
(e) the Holders of a majority in aggregate 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.
43
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 Principal Amount, Issue Price plus Accrued Original Issue
Discount, Redemption Price, Purchase Price, Change in Control Purchase Price or
interest 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 Principal Amount, Issue Price plus Accrued
Original Issue Discount, Redemption Price, Purchase Price, Change in Control
Purchase Price or interest in respect of the Securities shall then be due and
payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Company for the payment
of 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
Principal Amount, Issue Price plus Accrued Original Issue Discount,
Redemption Price, Purchase Price, Change in Control Purchase Price or
interest 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.
44
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 Principal Amount, Issue Price plus Accrued
Original Issue Discount, Redemption Price, Purchase Price,
Change in Control Purchase Price or interest 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 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 Principal Amount,
Issue Price plus Accrued Original Issue Discount, Redemption Price, Purchase
Price, Change in Control Purchase Price or interest 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
45
advantage of any such law, and covenants that it will not
hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
ARTICLE VII
TRUSTEE
Section 7.01. Certain Duties and Responsibilities.
-----------------------------------
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and
only such duties as are specifically set forth in this
Indenture, and no implied covenants or obligations shall be
read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this
Indenture; but in the case of any such certificates or
opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same to determine whether or
not they conform to the requirements of this Indenture (but
need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(b) In case an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers
vested in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent person would exercise or use
under the circumstances in the conduct of his or her own affairs.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except
that
(1) this Subsection shall not be construed to limit
the effect of Subsection (a) of this Section;
(2) the Trustee shall not be liable for
any error of judgement made in good faith by a Trust
Officer, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of a majority
in principal amount of the Outstanding Securities relating
to the time, method and place of conducting any proceeding
for any remedy
46
available to the Trustee, or exercising any
trust or power conferred upon the Trustee, under this
Indenture with respect to the Securities; and
(4) no provision of this Indenture shall require the
Trustee to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its
duties hereunder, or in the exercise of any of its rights
or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably
assured to it.
(d) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Section.
Section 7.02. Rights of Trustee.
-----------------
Subject to the provisions of Section 7.01:
(a) The Trustee may conclusively rely and be protected in
acting or refraining from acting 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 or attorneys and
shall not be responsible for the misconduct or negligence of any
agent or attorney 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.
(g) The Trustee may consult with counsel of its selection and
the advice of such counsel or any Opinion of Counsel shall be full
and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
47
(h) The Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request
or direction of any of the Holders pursuant to this Indenture, unless
such Holders shall have offered to the Trustee security or indemnity
satisfactory to the Trustee against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction.
(i) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or
attorney at the sole cost of the Company and shall incur no liability
or additional liability of any kind by reason of such inquiry or
investigation.
(j) The Trustee shall not be deemed to have notice of any
Default or Event of Default unless a Responsible Officer of the
Trustee has actual knowledge thereof or unless written notice of any
event which is in fact such a default is received by the Trustee at
the Corporate Trust Office of the Trustee, and such notice references
the Securities and this Indenture.
(k) The Trustee may request that the Company deliver an
Officers' Certificate setting forth the names of individuals and/or
titles of officers authorized at such time to take specified actions
pursuant to this Indenture, which Officers' Certificate may be signed
by any person authorized to sign an Officers' Certificate, including
any person specified as so authorized in any such certificate
previously delivered and not superseded.
All rights, privileges, protections, benefits and immunities granted to
the Trustee under this Indenture shall include the Trustee acting in any
capacity under this Indenture.
Section 7.03. 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 7.04. 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.
48
Section 7.05. 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 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 7.06. 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 7.07. Compensation and Indemnity. The Company agrees:
--------------------------
(a) to pay to the Trustee from time to time such 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)
as the Company shall from time to time agree in writing;
(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 7.07, within a
49
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 7.07, the Trustee shall have a lien prior to the Securities on all
money or property held or collected by the Trustee.
The Company's payment obligations pursuant to this Section 7.07 shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.01(e) or (f), 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 7.08. 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 7.08. The Holders of a majority in aggregate 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, to
the extent permitted by applicable law, remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(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 7.10.
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 7.07.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, at the Company's
expense, the Company or the Holders of a majority in aggregate 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 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
50
Section 7.09. Successor Trustee by Merger. 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.
Section 7.10. Eligibility; Disqualification. The Trustee shall at all
-----------------------------
times satisfy the requirements of TIA Sections 310(a)(1) and 310(b). The
Trustee 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 7.11. Preferential Collection of Claims Against Company. The
-------------------------------------------------
Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated therein.
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 Date or the Redemption Date, as the case may be, the
Principal Amount, the Purchase Price and interest (if 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 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 3.09), 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
one year; 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
51
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.
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 11.15;
(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 interest to be paid to Holders; or
(h) 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 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) make any reduction on the amount or rate of accrual of
Original Issue Discount or interest on any Security;
52
(b) make any Security payable in money or securities other
than that stated in the Security;
(c) make any reduction in the Principal Amount, Accrued
Original Issue Discount, Redemption Price, Purchase Price or Change
in Control Purchase Price with respect to any Security;
(d) make any change to the Principal Amount of Securities
whose Holders must consent to an amendment or supplement to this
Indenture.
(e) make any change that adversely affects the right to
convert any Security (including at the option of the Company, to
receive cash in lieu of Common Stock except as set forth in Section
9.01(e));
(f) make any change that adversely affects the right to
require the Company to purchase the Securities pursuant to Sections
3.09 and 3.10 hereof;
(g) 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
53
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 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
[Reserved]
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 8 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 Principal Amount thereof shall be determined in accordance with the
provisions of paragraph 8 of the Securities. The number of Shares issuable upon
conversion of a Security per $1,000 of Principal Amount thereof shall equal
14.9616, subject to adjustment (the "Conversion Rate").
A Holder may convert a portion of the Principal Amount of a Security if
the portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to conversion of all of a Security also apply to conversion
of a portion of a Security.
"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 11.08 or 11.09 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.
54
Section 11.02. Conversion Procedure. To convert a Security, a Holder
--------------------
must satisfy the requirements in paragraph 8 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 whole shares of Common Stock issuable upon the
conversion and cash in lieu of Common Stock pursuant to Section 11.06 or of any
fractional share determined pursuant to Section 11.03. The Company shall
determine such whole number of shares and the amounts of the cash, 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 8 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 Original Issue
Discount attributable to the period from the Issue Date of the Security through
the Conversion Date and (except as provided below) accrued and unpaid 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 delivery of the Common Stock (together with the cash payment, if any) in
exchange for the Security being converted pursuant to the provisions hereof; and
the fair market value of such shares of Common Stock (together with any such
cash payment) shall be treated as issued, to the extent thereof, first in
exchange for Original Issue Discount accrued through the Conversion Date and
accrued and unpaid 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
the total Principal Amount of the Securities converted.
55
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 April 24, 2022, (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 8
of the Securities, (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 8
of the Securities 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, provided that such Principal
Amount is $1,000 or an integral multiple thereof.
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 for
purposes of determining the existence of potential fractional shares, all
Securities surrendered by a Holder for conversion shall be considered together
(no matter how many separate Certificates are to be presented).
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 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.
56
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. Payment of Cash in Lieu of Common Stock.
---------------------------------------
In lieu of delivery of shares of Common Stock upon notice of conversion
of any Securities (for all or any portion of the Securities), the Company may
elect to pay Holders surrendering Securities an amount in cash per Security (or
a portion of a Security) equal to the average sale price of Common Stock for the
five consecutive Trading Days (the "Cash Settlement Averaging Period")
immediately following (a) the date of the notice of the Company's election to
deliver cash as described below if the Company has not previously given notice
of redemption and the expiration of the Conversion Retraction Period (as defined
below), or (b) the Conversion Date, in the case of conversion following the
Company's notice of redemption specifying that the Company intends to deliver
cash upon conversion, in either case multiplied by the Conversion Rate in effect
on that date. The Company will inform the Holders no later than two Business
Days following the Conversion Date of its election ("Cash Settlement Notice
Period") to pay cash in lieu of delivery of the Common Stock otherwise issuable
upon conversion, unless the Company has already informed Holders of its election
in connection with the Company's redemption of the Securities pursuant to
Section 3.01 or 3.02 herein. If the Company chooses to satisfy a portion of its
obligation in cash, notice of such election will specify the dollar amount or
percentage to be satisfied in cash. Holders may retract their conversion notice
at any time during the two Business Day period beginning on the day after the
final day of the Cash Settlement Notice Period ("Conversion Retraction Period");
no such retraction can be made (and a conversion notice shall be irrevocable) if
the Company does not elect to deliver cash in lieu of Common Stock (other than
cash in lieu of fractional shares). If the conversion notice has not been
retracted, then settlement (in cash and/or Common Stock) will occur on the day
following the final day of the Cash Settlement Averaging Period. If an Event of
Default (other than a default in a cash payment upon conversion of the
Securities), has occurred and is continuing, the Company may not pay cash upon
conversion of any Securities or portion of the Security (other than cash for
fractional shares).
If the Company specifies a cash settlement amount (the "Specified Cash
Amount"), the settlement amounts will be computed as follows:
Cash Settlement Portion: the Specified Cash Amount specified by the
Company, plus
Common Stock Settlement Portion: Conversion ratio minus the quotient
obtained by dividing the Specified Cash Amount by the average stock price, where
the average stock price is the average closing price of the Common Stock during
the 5 Trading Days in the Cash Settlement Averaging Period.
Notwithstanding any of the foregoing, the conversion ration will never
be less than zero.
57
Section 11.07. 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;
(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;
(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 (unless such dividend or distribution
is not paid, in which case no such adjustment shall be made) 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 11.08. Adjustment for Rights Issue.
---------------------------
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
45 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:
R' = R x (O + N)
----------------------
(O + [(N x P)/M)]
where:
58
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 11.08 is being applied.
N = the number of additional shares of Common Stock offered pursuant to
the distribution.
P = the offering or exercise price per share of the additional shares.
M = the Average Sale Price, minus, in the case of (i) a distribution to
which Section 11.07(d) applies or (ii) a distribution to which Section 11.09
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 11.08 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 11.08 applies, the fair
market value (on the record date for the distribution to which this Section
11.08 applies) of:
(1) the capital stock of the Company distributed
in respect of each share of Common Stock in such Section
11.07(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 11.09 distribution.
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 rights, warrants
or options to which this Section 11.08 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.
No adjustment shall be made under this Section 11.08 if the application
of the formula stated above in this Section 11.08 would result in a value of R'
that is equal to or less than the value of R.
Section 11.09. Adjustment for Other Distributions. (a) Subject to
----------------------------------
11.09(c), 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)
59
distributions of capital stock referred to in Section 11.07 and distributions
of rights, warrants or options referred to in Section 11.08 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, and only to the extent, such cash dividends or other cash
distributions are Extraordinary Cash Dividends) the Conversion Rate shall be
adjusted, subject to the provisions of Section 11.09(c), in accordance with the
formula:
R' = R x M
---------
M - F
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the Average Sale Price, minus, in the case of a distribution to
which Section 11.07(d) applies, for which (i) the record date shall occur on or
before the record date for the distribution to which this Section 11.09 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 11.09 applies, the fair
market value (on the record date for the distribution to which this Section
11.09 applies) of any capital stock of the Company distributed in respect of
each share of Common Stock in such Section 11.07(d) distribution.
F = the fair market value (on the record date for the distribution to
which this Section 11.09 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 11.09 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 11.09.
The adjustment shall become effective immediately after the record date
for the determination of shareholders entitled to receive the distribution to
which this Section 11.09 applies. No adjustment will be made to the Conversion
Rate if the distribution is not made.
For purposes of this Section 11.09, the term "Extraordinary Cash
Dividend" shall mean any cash dividend or distribution with respect to the
Common Stock the amount of which, together with the aggregate amount of cash
dividends on the Common Stock to be aggregated with 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
60
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
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, 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 11.09, 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 11.09.
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 11.07.
(b) 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").
F = the fair market value of the securities distributed in respect of
each share of Common Stock for which this Section 11.09(b) 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
61
securities distributed for the ten (10) Trading Days commencing on and
including the fifth Trading Day after the effectiveness of the Ex-Dividend Date.
(c) In the event that, with respect to any distribution to
which Section 11.09(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 11.09(a) shall not be made
and in lieu thereof the provisions of Section 11.15 shall apply to such
distribution.
Section 11.10. 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 11.11. When No Adjustment Required. No adjustment need be made
---------------------------
for a transaction referred to in Section 11.07, 11.08, 11.09 or 11.15 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 Issue Price plus Accrued Original Issue
Discount 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 11.12. Notice of Adjustment. Whenever the Conversion Rate is
--------------------
adjusted, the Company shall promptly mail to Securityholders a notice of the
adjustment. The Company shall file with the Trustee and the Conversion Agent
such notice and a certificate from the Company's
62
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 11.13. Voluntary Increase. The Company from time to time may
------------------
increase the Conversion Rate by any amount and for any period of time that the
Company determines, in its sole discretion, to be appropriate. 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 11.07, 11.08 or
11.09.
Section 11.14. Notice of Certain Transactions. If:
------------------------------
(a) the Company takes any action that would require an
adjustment in the Conversion Rate pursuant to Section 11.07, 11.08 or
11.09 (unless no adjustment is to occur pursuant to Section 11.11); or
(b) the Company takes any action that would require a
supplemental indenture pursuant to Section 11.15; 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 11.15. 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.
63
The supplemental indenture to be entered into by such Person pursuant
to the immediately preceding paragraph 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 11.07 nor 11.08 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
11.09(c), would otherwise result in an adjustment in the Conversion Rate
pursuant to the provisions of Section 11.09, 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 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 11.16. Company Determination Final. Any determination that the
---------------------------
Company or the Board of Directors must make pursuant to Section 11.03, 11.07,
11.08, 11.09, 11.10, 11.11, 11.15 or 11.18 is conclusive.
Section 11.17. 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 11.15 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 11.17 as the
Trustee.
Section 11.18. Simultaneous Adjustments. In the event that this
------------------------
Article 11 requires adjustments to the Conversion Rate under more than one of
Sections 11.07(d), 11.08 or 11.09, 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 11.07,
second, the provisions of Section 11.09 and, third, the provisions of Section
11.08.
64
Section 11.19. 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 11.20. 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 terms of any 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 INTEREST
Section 12.01. Interest Payments. Interest on any Security that is
-----------------
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the person in whose name that Security is registered at
the close of business on April 1 and October 1 of each year (each a "Regular
Record Date") at the office or agency of the Company maintained for such
purpose. Each installment of 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
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 interest on any Security that is
------------------
payable, but is not punctually paid or duly provided for, within 30 days
following any 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
65
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 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 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.
66
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:
BJ Services Company
5500 Northwest Central Drive
Houston, TX 77092
Attention: Vice President and Treasurer
if to the Trustee:
The Bank of New York
101 Barclay Street, Floor 21W
New York, New York 10286
Attention: Corporate Trust Administration
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
67
(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;
(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. Consent to Jurisdiction. Each party hereto irrevocably
-----------------------
submits to the jurisdiction of any United States Federal or New York State court
sitting in The City of New York, the Borough of Manhattan for the purpose of any
suit, action or proceeding arising out of or related to this Indenture or any
Note ("Proceedings"). Each such party waives to the fullest extent permitted by
law, any objection which it may have to the laying of the venue of any such
Proceedings brought in such a court and any claim that any such Proceedings have
been brought in an inconvenient forum. Each such party agrees that final
judgment in any Proceedings brought in such a court shall be conclusive and
binding upon it and may be enforced in any court to the jurisdiction of which it
is subject by a suit upon such judgment; provided, that in the case of the
Company, service of process is effected on it in accordance with the provisions
set forth herein or as otherwise permitted by law.
As long as any Security remains outstanding, the Company shall at all
times have an authorized agent in The City of New York, the Borough of
Manhattan, upon whom process may be served in connection with any Proceedings.
Service of process upon such agent and written
68
notice of such service delivered to the Company shall, to the fullest extent
permitted by applicable law, be deemed in every respect effective service of
process upon the Company in any Proceedings.
To the extent that the Company may in any jurisdiction claim for itself
or its assets immunity from suit, execution, attachment (whether in aid of
execution, before judgment, or otherwise) or other legal process and to the
extent that in any such jurisdiction there may be attributed to itself or its
assets such immunity (whether or not claimed), the Company shall irrevocably
agree not to claim and shall irrevocably waive such immunity to the full extent
permitted by the laws of such jurisdiction.
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 and 6 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 acted in good faith, and may conclusively 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.
69
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.
BJ SERVICES COMPANY
By /s/ T. M. Whichard
------------------------------
Name: T. M. Whichard
Title: Vice President and Treasurer
THE BANK OF NEW YORK
By: /s/ Beata Hryniewicka
------------------------------
Name: Beata Hryniewicka
-----------------
Title: Assistant Treasurer
1
ANNEX A
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"), BJ SERVICES
---
COMPANY (THE "COMPANY") OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF 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.
THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION
OF THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY, THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD ,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED
THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A ("RULE
144A") THEREUNDER.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH SECURITY PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF (OR THE OVERALLOTMENT OPTION ISSUE DATE, IF ANY) AND
THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER
OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A) TO THE COMPANY
OR ANY SUBSIDIARY THEREOF, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A
1
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE
ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN
CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT,
(D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, OR (E) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (C) OR
(E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION
AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH OF
THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING
ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE TRUSTEE AND IN EACH CASE IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO ABOVE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF
THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
2
BJ SERVICES COMPANY
Convertible Senior Note due 2022
No. R-144A- CUSIP: 055482AE3
Issue Date: April 24, 2002 Original Issue Discount: $209.24
Issue Price: $790.76 (for each $1,000 Principal
(for each $1,000 Principal Amount at Stated Maturity)
Amount at Stated Maturity)
BJ SERVICES COMPANY, a Delaware corporation, (the "Company"), for
value received, hereby promises to pay to Cede & Co., or registered assigns, the
Principal Amount (the "Principal Amount") of
($ ) on April 24, 2022, and to pay interest on the Issue Price stated above
from April 24, 2002 or from the most recent date to which interest has been paid
or duly provided for, semiannually on April 24 and October 24 in each
year (each, an "Interest Payment Date"), commencing October 24, 2002,
at the rate of 0.50% per annum, until the principal hereof is paid or
duly made available for payment. Interest on this Security shall be
calculated on the basis of a 360-day year consisting of twelve 30-day
months. The interest so payable and punctually paid or duly provided
for on any Interest Payment Date will, as provided in such Indenture,
be paid to the Person in whose name this Security is registered at
the close of business on the Regular Record Date for such interest,
which shall be the April 9 or October 9 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date.
Any interest which is payable, but is not punctually paid or duly
provided for, on any Interest Payment Date shall forthwith cease to
be payable to the registered Holder hereof on the relevant Regular
Record Date by virtue of having been such Holder, and may be paid to
the Person in whose name this Security is registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest to be fixed by the Company, notice whereof shall be given to
the Holders of the Securities not less than 10 days prior to such
Special Record Date, or may be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice
as may be required by such exchange, all as more fully provided in
such Indenture. This Security is convertible as specified on the
other side on this Security.
Payment of the principal of and interest, if any, on this Security will
be made at the office or agency of the Company maintained for that purpose, in
the Borough of Manhattan, The City of New York, in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; provided, however, that at the option of the
Company, payment of interest, if any, may be made by check mailed to the address
of the Person entitled thereto as such address shall appear in the Registrar.
3
Additional provisions of this Security are set forth on the reverse
side of this Security.
Dated: April 24, 2002
BJ SERVICES COMPANY
By:____________________________
T. M. Whichard
Treasurer
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK,
as Trustee, certifies that this
is one of the Securities referred
to in the within-mentioned Indenture.
By:_______________________________
Authorized Signatory
Dated: April 24, 2002
4
BJ SERVICES COMPANY
Convertible Senior Note due 2022
1. Interest.
--------
If the Principal Amount hereof or any portion of such 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 5 hereof, upon the date set for payment of the Purchase Price or
Change in Control Purchase Price pursuant to paragraph 6 hereof or upon the
Stated Maturity of this Security) or interest due hereon or any portion of such
interest is not paid when due, then in each such case the overdue amount shall,
to the extent permitted by law, bear interest at the rate of 1.625% per annum,
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, the continued accrual of Original Issue Discount.
Original Issue Discount (the difference between the Issue Price and
the Principal Amount of the Security), in the period during which a Security
remains outstanding, shall accrue at 1.625% per annum, on a semi-annual bond
equivalent basis using a 360-day year comprised of twelve 30-day months, from
the Issue Date of this Security.
2. Method of Payment.
-----------------
Subject to the terms and conditions of the Indenture, the Company will
make payments in respect of interest, 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. 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 and Registrar.
--------------------------------------------
Initially, The Bank of New York, a banking corporation organized and
existing under the laws of the State of New York, (the "Trustee"), will act as
Paying Agent, Conversion Agent and Registrar. The Company may appoint and change
any Paying Agent, Conversion Agent, Registrar or co-registrar or Bid
Solicitation Agent without notice, other than 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.
4. Indenture.
---------
The Company has issued the Securities under an Indenture dated as of
April 24, 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
5
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 $516,350,000 aggregate 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. Redemption at the Option of the Company.
---------------------------------------
No sinking fund is provided for the Securities. The Securities are
redeemable in cash as a whole, or from time to time in part, at any time at the
option of the Company at the redemption prices set forth below (the "Redemption
Price") plus accrued and unpaid interest on the Redemption Date, provided that
the Securities are not redeemable prior to April 24, 2005.
The table below shows the Redemption Prices of a Security per $1,000
Principal Amount on the dates shown below and at Stated Maturity. These prices
reflect the Issue Price plus Accrued Original Issue Discount on the Redemption
Date. The Redemption Price of a Security redeemed between such dates shall
include an additional amount reflecting the additional Original Issue Discount
accrued since the next preceding date in the table.
Note Accrued Original Redemption
Redemption Date Issue Price Issue Price Price
- --------------- -------------- ------------------ ------------
April 24, 2005................. $790.76 $27.23 $817.99
April 24, 2006................. $790.76 $36.61 $827.37
April 24, 2007................. $790.76 $46.14 $836.90
April 24, 2008................. $790.76 $55.82 $846.58
April 24, 2009................. $790.76 $65.67 $856.43
April 24, 2010................. $790.76 $75.67 $866.43
April 24, 2011................. $790.76 $85.84 $876.60
April 24, 2012................. $790.76 $96.17 $886.93
April 24, 2013................. $790.76 $106.67 $897.43
April 24, 2014................. $790.76 $117.34 $908.10
April 24, 2015................. $790.76 $128.19 $918.95
April 24, 2016................. $790.76 $139.21 $929.97
April 24, 2017................. $790.76 $150.42 $941.18
April 24, 2018................. $790.76 $161.80 $952.56
April 24, 2019................. $790.76 $173.38 $964.14
April 24, 2020................. $790.76 $185.14 $975.90
April 24, 2021................. $790.76 $197.09 $987.85
At Stated Maturity............. $790.76 $209.24 $1,000.00
6
6. Purchase by the Company at the Option of the Holder.
---------------------------------------------------
Subject to the terms and conditions of the Indenture, the Company shall
become obligated to purchase, at the option of the Holder, the Securities held
by such Holder on the following Purchase Dates and at the following prices per
$1,000 Principal Amount, plus accrued and unpaid interest (the "Purchase
Price"), 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.
Purchase Date Purchase Price
------------- --------------
April 24, 2005 $817.99
April 24, 2007 $836.90
April 24, 2012 $886.93
April 24, 2017 $941.18
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 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 April 24, 2005 for a Change in
Control Purchase Price for each $1,000 Principal Amount of such Securities equal
to the Issue Price plus accrued Original Issue Discount to the Change in Control
Purchase Date, which Change in Control Purchase Price shall be paid in cash.
Holders have the right to withdraw any Purchase Notice or Change in
Control Purchase Notice, as the case may be, by delivering to the Paying Agent a
written notice of withdrawal 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, Original Issue Discount and interest 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).
7
7. 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, Original Issue Discount and interest
shall cease to accrue on such Securities or portions thereof. Securities in
denominations larger than $1,000 of Principal Amount may be redeemed in part but
only in integral multiples of $1,000 of Principal Amount.
8. Conversion.
----------
Subject to the provisions of this paragraph 8 and the terms of the
Indenture and notwithstanding the fact that any other condition to conversion
has not been satisfied, commencing after June 30, 2002, holders may surrender
this Security for conversion into shares of Common Stock in any quarter (and
only during such quarter), at their option, if 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 the immediately preceding quarter is more than
the conversion trigger price. The "conversion trigger price" is a reference
percentage beginning at 120% and declining 0.12658% per quarter thereafter to
approximately 110% on the last day of the quarter ending March 31, 2022, of the
accreted conversion price per share of Common Stock on the last day of such
quarter.
The "accreted conversion price" per share of Common Stock as of any day
equals the quotient of:
. the Issue Price plus accrued Original Issue Discount to that
day, divided by
. the number of shares of Common Stock issuable upon
conversion of $1,000 Principal Amount of Securities on that day.
The table below shows the conversion trigger price per share of Common
Stock in respect of each of the first 12 calendar quarters. These prices reflect
the accreted conversion price per share of Common Stock (assuming that no events
occurred requiring an adjustment to the initial Conversion Rate of 14.9616
shares of Common Stock per $1,000 Principal Amount of Maturity) multiplied by
the applicable percentage for the respective calendar quarter. Thereafter, the
accreted conversion price per share of Common Stock increases each calendar
quarter by the accrued Original Issue Discount for the quarter and the
applicable percentage declines by 0.12658% per quarter. The conversion trigger
price for the calendar quarter beginning April 1, 2022 is $73.46.
8
Accreted Applicable Conversion
Quarter(*) Conversion Price Percentage Trigger Price
-------- -------------------- -------------- -----------------
2002
Third Quarter......................... $52.96 120.00000% $63.55
Fourth Quarter........................ $53.11 119.87342% $63.66
2003
First Quarter......................... $53.26 119.74684% $63.78
Second Quarter........................ $53.41 119.62026% $63.89
Third Quarter......................... $53.56 119.49368% $64.00
Fourth Quarter........................ $53.71 119.36710% $64.11
2004
First Quarter......................... $53.87 119.24052% $64.23
Second Quarter........................ $54.02 119.11394% $64.35
Third Quarter......................... $54.17 118.98736% $64.46
Fourth Quarter........................ $54.32 118.86078% $64.57
2005
First Quarter......................... $54.48 118.73420% $64.69
Second Quarter........................ $54.63 118.60762% $64.80
- ----------
* This table assumes no events have occurred that would require an adjustment to
the conversion rate.
Subject to the provisions of this paragraph 8 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) Moody's Investors Service, Inc. and its successors ("Moody's") and (2)
-------
Standard & Poor's Credit Market Services, a division of The McGraw-Hill
Companies Inc., and its successors ("Standard & Poor's"). "Applicable Rating"
-----------------
means (1) Ba2, in the case of Moody's (or its equivalent under any successor
ratings categories of Moody's), (2) BB+, in the case of Standard & Poor's (or
its equivalent under any successor ratings categories of Standard & Poor's), or
(3) the equivalent in respect of ratings categories of any Rating Agencies which
are successors to Moody's and Standard & Poor's.
Subject to the provisions of this paragraph 8 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 5 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 8 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 11.08 of the Indenture, or a dividend or a distribution
described in Section 11.09 of the Indenture where the fair market value of such
dividend or distribution per share of Common Stock, as determined in the
Indenture, exceeds
9
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.
Subject to the provisions of this paragraph 8 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 11.15 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 14.9616 shares of Common Stock per
$1,000 Principal Amount, subject to adjustment for certain events described in
the Indenture or this paragraph 8. The Company will deliver cash or a check in
lieu of any fractional share of Common Stock.
Securities or portions thereof surrendered for conversion during the
period from the close of business on any Regular Record Date immediately
preceding any Interest Payment Date to the opening of business on such Interest
Payment Date shall (except for Securities called for redemption on a Redemption
Date that occurs during the period between the close of business on a Regular
Record Date and the opening of business on the fourth business day after the
Interest Payment Date to which such Regular Record Date relates) be accompanied
by payment of an amount equal to the interest payable on such Interest Payment
Date.
A Holder's right to convert the Securities into Common Stock of the
Company is also subject to the Company's right to elect to pay such Holder the
amount of cash set forth in the next succeeding sentence in lieu of delivering
all or part of such Common Stock. The amount of cash to be paid for each $1,000
principal amount of a Security shall be equal to the average sale price of
Common Stock for the five consecutive Trading Days (the "Cash Settlement
Averaging Period") immediately following (a) the date of the notice of the
Company's election to deliver cash as described below if the Company has not
previously given notice of redemption and the expiration of the Conversion
Retraction Period (as defined below), or (b) the Conversion Date, in the case of
conversion following the Company's notice of redemption specifying that the
Company intends to deliver cash upon conversion, in either case multiplied by
the Conversion
10
Rate in effect on that date. The Company will inform the holders through the
Trustee no later than two Business Days following the Conversion Date of its
election ("Cash Settlement Notice Period") to pay cash in lieu of delivery of
the Common Stock otherwise issuable upon conversion, unless the Company has
already informed Holders of its election in connection with the Company's
redemption of the Securities. If the Company chooses to satisfy all or a
portion of its obligation in cash, notice of such election will specify the
dollar amount to be satisfied in cash. Holders may retract their conversion
notice at any time during the two Business Day period beginning on the day
after the final day of the Cash Settlement Notice Period ("Conversion
Retraction Period"); no such retraction can be made (and a conversion notice
shall be irrevocable) if the Company does not elect to deliver cash in lieu of
Common Stock. If the conversion notice has not been retracted, then settlement
(in cash and/or Common Stock) will occur on the day following the final day of
the Cash Settlement Averaging Period. If an Event of Default (other than a
default in a cash payment upon conversion of the Securities), has occurred and
is continuing, the Company may not pay cash (other than cash in lieu of
fractional shares) upon conversion of any Securities or portion of the Security.
If the Company specifies a cash settlement amount (the "Cash Settlement
Amount"), the settlement amounts will be computed as follows:
Cash Settlement Portion: the Cash Settlement Amount specified by the
Company, plus
Common Stock Settlement Portion: Conversion ratio minus the quotient of
the Cash Settlement Amount divided by the average stock price, where the average
stock price is the average closing price of the Common Stock during the 5
Trading Days referred to above.
A Holder may only convert a portion of a Security pursuant to the terms
of this paragraph 8 and in accordance with the Indenture if the 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, that portion of
Accrued Original Issue Discount attributable to the period from the Issue Date
through the Conversion Date and (except as provided above) any accrued and
unpaid 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 any cash
payment) 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) shall be treated as issued, to the extent thereof, first
in exchange for Original Issue Discount accrued through the Conversion Date and
accrued and unpaid 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; 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 45 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 other
11
cash distributions from current or retained earnings other than Extraordinary
Cash Dividends). 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 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 Accrued Original Issue
Discount or any interest.
10. [Reserved.]
11. Defaulted Interest.
------------------
Except as otherwise specified with respect to the Securities, any
interest on any Security shall forthwith cease to be payable to the registered
Holder thereof on the relevant Regular Record Date or accrual date, 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 Principal Amount and integral multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not transfer or exchange
any Securities selected for redemption (except, in the case of a Security to be
redeemed in part, the portion of the Security not to be redeemed) or any
Securities in respect of which a Purchase Notice or Change in Control Purchase
Notice has been given and not withdrawn (except, in the case of a Security to be
purchased in part, the portion of the Security not to be purchased) or any
Securities for a period of 15 days before the mailing of a notice of redemption
of Securities to be redeemed.
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
12
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.
15. Amendment.
---------
Subject to certain exceptions set forth in the Indenture, the Indenture
or the Securities may be amended with the written consent of the Holders of at
least a majority in aggregate 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 11.15 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 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
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 Sections 6.01(a) or 6.01(b) of the Indenture) 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
13
Security, each Securityholder waives and releases all such liability. The
waiver and release are part of the consideration for the issue of the
Securities.
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.
BJ Services Company
5500 Northwest Central Drive
Houston, TX 77092
Attention: General Counsel
14
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
Principal Amount to be converted (which must
_________________________________________________ be $1,000 or an integral multiple of $1,000): $
_________________________________
_________________________________________________
(Insert assignee's soc. Sec. or tax ID no.)
If you want the stock certificate made out in another
_________________________________________________ person's name, fill in the form below:
_________________________________________________ ___________________________________________
(Print or type assignee's name, address
and zip code) ___________________________________________
(Insert other person's soc. sec. or tax ID no.)
and irrevocably appoint _________________________
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.
15
EXHIBIT B-1
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR
REGISTRATION OF TRANSFER OF RESTRICTED SECURITIES/1/
Re: Convertible Senior Notes due 2022 (the "Securities") of BJ
Services Company
This certificate relates to $___________ principal amount of Securities
owned in (check applicable box)
[ ] book-entry or
[ ] definitive form
by _________________________________________________________ (the "Transferor").
The Transferor has requested a Security Registrar or the Trustee to
exchange or register the transfer of such Securities.
In connection with such request and in respect of each such Security,
the Transferor does hereby certify that the Transferor is familiar with transfer
restrictions relating to the Securities as provided in Section 2.12 of the
Indenture dated as of April 24, 2002 (the "Indenture"), between BJ Services
Company and The Bank of New York, as trustee.
In connection with any transfer of any of the Securities evidenced by
this certificate occurring prior to the expiration of the period referred to in
Rule 144(k) under the Securities Act after the later of the date of original
issuance of the Securities and the last date, if any, on which such Securities
were owned by the Company or any Affiliate of the Company, the undersigned
confirms that such Securities are being transferred in accordance with its
terms:
CHECK ONE BOX BELOW
(1) [ ] to the Company or a subsidiary of the Company; or
(2) [ ] pursuant to an effective registration statement
under the Securities Act of 1933; or
(3) [ ] to a "qualified institutional buyer" (as defined in
Rule 144A under the Securities Act of 1933) that
purchases for its own account or for the account of
a qualified institutional buyer to whom notice is
given that such transfer is being made in reliance
on Rule 144A, in each case pursuant to and in
compliance with Rule 144A under the Securities Act
of 1933; or
(4) [ ] to an institutional accredited investor, defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act; or
___________________________
/1/ This certificate should only be included if this Security is a Transfer
Restricted Security.
B-1-1
(5) [ ] pursuant to another available exemption from
registration under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered holder thereof, provided, however, that if box (4) or (5) is
checked, the Trustee may require, prior to registering any such transfer of the
Securities, such legal opinions, certifications and other information as the
Company has reasonably requested to confirm that such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933, such as the exemption
provided by Rule 144 under such Act.
________________________________
Signature
Signature Guarantee:
________________________________ ________________________________
Signature must be guaranteed by an Signature
"eligible guarantor institution" meeting
the requirements of the Registrar,
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 Registrar in
addition to, or in substitution for,
STAMP, all in accordance with the
Securities Exchange Act of 1934, as
amended.
TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Company as
the undersigned has requested pursuant to Rule 144A or has determined not to
request such information and that it is aware that the transferor is relying
upon the undersigned's foregoing representations in order to claim the exemption
from registration provided by Rule 144A.
Dated:_______________________ __________________________________
NOTICE: To be executed by an
executive officer
B-1-2
EXHIBIT B-2
Form of Letter to be Delivered by Accredited Investors
BJ Services
5500 Northwest Central Drive
Houston, TX 77092
Attention: General Counsel
The Bank of New York, as Security Registrar
101 Barclay Street, Floor 21W
New York, New York 10286
Attention: Corporate Trust Administration
Dear Sirs:
We are delivering this letter in connection with the proposed transfer
of $_____________ principal amount of the Convertible Senior Notes due 2022 (the
"Securities") of BJ Services Company (the "Company"), which are convertible into
shares of Common Stock of the Company.
We hereby confirm that:
(i) we are an "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act of
1933, as amended (the "Securities Act"), or an entity in which all of
the equity owners are "accredited investors" within the meaning of Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act (an
"Institutional Accredited Investor");
(ii) the purchase of Securities by us is for our own account
or for the account of one or more other Institutional Accredited
Investors or as fiduciary for the account of one or more trusts, each
of which is an "accredited investor" within the meaning of Rule
501(a)(7) under the Securities Act and for each of which we exercise
sole investment discretion or (B) we are a "bank," within the meaning
of Section 3(a)(2) of the Securities Act, or a "savings and loan
association" or other institution described in Section 3(a)(5)(A) of
the Securities Act that is acquiring Securities as fiduciary for the
account of one or more institutions for which we exercise sole
investment discretion;
(iii) we will acquire Securities having a minimum aggregate
principal amount of not less than $100,000 for our own account or for
any separate account for which we are acting;
(iv) we have such knowledge and experience in financial and
business matters that we are capable of evaluating the merits and risks
of purchasing Securities; and
B-1-3
(v) we are not acquiring Securities with a view to
distribution thereof or with any present intention of offering or
selling Securities or the Common Stock deliverable upon conversion
thereof, except as permitted below; provided that the disposition of
our property and property of any accounts for which we are acting as
fiduciary shall remain at all times within our control.
We understand that the Securities were originally offered and sold in a
transaction not involving any public offering within the United States within
the meaning of the Securities Act and that the Securities and the shares of
Common Stock (the "Securities") issuable upon conversion thereof have not been
registered under the Securities Act, and we agree, on our own behalf and on
behalf of each account for which we acquire any Securities, that if in the
future we decide to resell or otherwise transfer such Securities prior to the
date on which the Securities are transferable pursuant to Rule 144(k) under the
Securities Act, such Securities may be resold or otherwise transferred only (i)
to the Company or any subsidiary thereof, or (ii) for as long as the Securities
are eligible for resale pursuant to Rule 144A, to a person we reasonably believe
to be a "qualified institutional buyer" (as defined in Rule 144A under the
Securities Act) that purchases for its own account or for the account of such a
qualified institutional buyer to which notice is given that the transfer is
being made in reliance on Rule 144A, or (iii) to an Institutional Accredited
Investor that is acquiring the Security for its own account, or for the account
of such an Institutional Accredited Investor for investment purposes and not
with a view to, or for offer or sale in connection with, any distribution in
violation of the Securities Act, or (iv) pursuant to another available exemption
from registration under the Securities Act (if applicable), or (v) pursuant to a
registration statement which has been declared effective under the Securities
Act and, in each case, in accordance with any applicable securities laws of any
State of the United States or any other applicable jurisdiction and in
accordance with the legends set forth on the Securities. We further agree to
provide any person purchasing any of the Securities other than pursuant to
clause (v) above from us a notice advising such purchaser that resales of such
securities are restricted as stated herein. We understand that the trustee or
the transfer agent, as the case may be, for the Securities will not be required
to accept for registration of transfer any Securities pursuant to (iii) or (iv)
above except upon presentation of evidence satisfactory to the Company and the
trustee that the foregoing restrictions on transfer have been complied with. We
further understand that any Securities will be in the form of definitive
physical certificates and that such certificates will bear a legend reflecting
the substance of this paragraph other than certificates representing Securities
transferred pursuant to clause (v) above.
We acknowledge that the Company, others, the Trustee, the Security
Registrar and you will rely upon our confirmations, acknowledgments and
agreements set forth herein, and we agree to notify you promptly in writing if
any of our representations or warranties herein ceases to be accurate and
complete.
4
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK.
____________________________________
(Name of Purchaser)
By:________________________________
Name:
Title:
Address:
5