EXHIBIT 4.1
LIONS GATE ENTERTAINMENT INC.
as Issuer
LIONS GATE ENTERTAINMENT CORP.
as Guarantor
2.9375% CONVERTIBLE SENIOR SUBORDINATED NOTES DUE 2024
-------------------------
INDENTURE
Dated as of October 4, 2004
-------------------------
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION,
as Trustee
CROSS-REFERENCE TABLE
TRUST INDENTURE
ACT SECTION INDENTURE SECTION
- ------------------------ -----------------
310 (a)(1) 6.10
(a)(2) 6.10
(a)(3) N/A
(a)(4) N/A
(a)(5) N/A
(b) 6.10, 6.8, 16.2
(c) N/A
311 (a) 6.11
(b) 6.11
(c) N/A
312 (a) 2.05
(b) 16.3
(c) 16.3
313 (a) 6.6
(b) 6.6
(c) 6.6, 16.2
(d) 6.6
314 (a) 10.3
(a)(4) 10.3, 10.4, 16.6
(b) N/A
(c)(1) 16.5
(c)(2) 16.5
(c)(3) N/A
(d) N/A
(e) 16.6
(f) N/A
315 (a) 6.1(b)
(b) 6.5, 16.2
(c) 6.1(a)
(d) 6.1(c)
(e) 5.14
316 (a)(last sentence) 2.9
(a)(1)(A) 5.5
(a)(1)(B) 5.4
(a)(2) N/A
(b) 5.7
(c) 8.4
317 (a)(1) 5.8
(a)(2) 5.9
(b) 2.4
318 (a) 16.1
(b) N/A
(c) 16.1
"N/A" means not applicable.
*This Cross-Reference Table shall not, for any purpose, be deemed to be a part
of the Indenture.
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TABLE OF CONTENTS
Page
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Article I. DEFINITIONS AND INCORPORATION BY REFERENCE................................................................1
Section 1.1 Definitions..................................................................................1
Section 1.2 Incorporation by Reference of Trust Indenture Act...........................................11
Section 1.3 Rules of Construction.......................................................................11
Article II. THE NOTES................................................................................................11
Section 2.1 Form and Dating.............................................................................11
Section 2.2 Execution and Authentication................................................................14
Section 2.3 Registrar, Paying Agent and Conversion Agent................................................14
Section 2.4 Paying Agent To Hold Money in Trust.........................................................15
Section 2.5 Holder Lists................................................................................15
Section 2.6 Transfer and Exchange.......................................................................15
Section 2.7 Replacement Notes...........................................................................16
Section 2.8 Outstanding Notes...........................................................................16
Section 2.9 Notes Held by the Issuer or an Affiliate....................................................17
Section 2.10 Temporary Notes.............................................................................17
Section 2.11 Cancellation................................................................................17
Section 2.12 Defaulted Interest..........................................................................17
Section 2.13 CUSIP Numbers...............................................................................17
Section 2.14 Deposit of Moneys...........................................................................18
Section 2.15 Book-Entry Provisions for Global Notes......................................................18
Section 2.16 Special Transfer Provisions.................................................................19
Section 2.17 Restrictive Securities Legends..............................................................20
Article III. NOTE GUARANTEE...........................................................................................21
Section 3.1 Note Guarantee..............................................................................21
Section 3.2 Consideration...............................................................................22
Section 3.3 Execution of Guarantee......................................................................22
Section 3.4 Successor Guarantee.........................................................................23
Article IV. SATISFACTION AND DISCHARGE...............................................................................23
Section 4.1 Satisfaction and Discharge of Indenture.....................................................23
Section 4.2 Deposited Monies to be Held in Trust........................................................24
Section 4.3 Return of Unclaimed Monies..................................................................24
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Article V. DEFAULTS AND REMEDIES....................................................................................24
Section 5.1 Events of Default...........................................................................24
Section 5.2 Acceleration of Maturity; Rescission and Annulment..........................................26
Section 5.3 Other Remedies..............................................................................26
Section 5.4 Waiver of Past Defaults.....................................................................27
Section 5.5 Control by Majority.........................................................................27
Section 5.6 Limitation on Suit..........................................................................28
Section 5.7 Unconditional Right of Holders to Receive Payment...........................................28
Section 5.8 Collection of Indebtedness and Suits for Enforcement By the Trustee.........................28
Section 5.9 Trustee May File Proofs of Claim............................................................29
Section 5.10 Restoration of Rights and Remedies..........................................................30
Section 5.11 Rights and Remedies Cumulative..............................................................30
Section 5.12 Delay or Omission Not Waiver................................................................30
Section 5.13 Application of Money Collected..............................................................30
Section 5.14 Undertaking for Costs.......................................................................31
Section 5.15 Waiver of Stay or Extension Laws............................................................31
Article VI. THE TRUSTEE..............................................................................................31
Section 6.1 Duties of Trustee...........................................................................31
Section 6.2 Rights of Trustee...........................................................................32
Section 6.3 Individual Rights of Trustee................................................................34
Section 6.4 Trustee's Disclaimer........................................................................34
Section 6.5 Notice of Defaults..........................................................................34
Section 6.6 Reports by Trustee to Holders...............................................................34
Section 6.7 Compensation and Indemnity..................................................................35
Section 6.8 Replacement of Trustee......................................................................35
Section 6.9 Successor Trustee by Merger, etc............................................................36
Section 6.10 Eligibility; Disqualification...............................................................36
Section 6.11 Preferential Collection of Claims Against Issuer and the Company............................36
Article VII. CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE.....................................................37
Section 7.1 Issuer or Company May Consolidate, Etc., Only on Certain Terms..............................37
Section 7.2 Successor Corporation Substituted...........................................................37
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Article VIII. AMENDMENTS, SUPPLEMENTS AND WAIVERS......................................................................38
Section 8.1 Without Consent of Holders of Notes.........................................................38
Section 8.2 With Consent of Holders of Notes............................................................39
Section 8.3 Compliance with Trust Indenture Act.........................................................40
Section 8.4 Revocation of Consents and Effect of Consents or Votes......................................40
Section 8.5 Notation on or Exchange of Notes............................................................41
Section 8.6 Trustee to Sign Amendment, Etc..............................................................41
Article IX. MEETING OF HOLDERS OF NOTES..............................................................................41
Section 9.1 Purposes for Which Meetings May be Called...................................................41
Section 9.2 Call Notice and Place of Meetings...........................................................41
Section 9.3 Persons Entitled to Vote at Meetings........................................................42
Section 9.4 Quorum; Action..............................................................................42
Section 9.5 Determination of Voting Rights; Conduct and Adjournment of Meetings.........................43
Section 9.6 Counting Votes and Recording Action of Meetings.............................................43
Article X. COVENANTS................................................................................................44
Section 10.1 Payment of Notes............................................................................44
Section 10.2 Maintenance of Office or Agency.............................................................44
Section 10.3 Reports.....................................................................................45
Section 10.4 Compliance Certificate......................................................................45
Section 10.5 Stay, Extension and Usury Laws..............................................................45
Section 10.6 Corporate Existence.........................................................................46
Section 10.7 Notice of Default...........................................................................46
Article XI. MAKE WHOLE PREMIUM.......................................................................................46
Section 11.1 Make Whole Premium..........................................................................46
Section 11.2 Issuer's Option to Provide for Conversion into Shares of Acquiror
in Lieu of Make Whole Premium...............................................................48
Section 11.3 Adjustments Relating to Make Whole Premium..................................................48
Article XII. REDEMPTION OF NOTES......................................................................................49
Section 12.1 [Reserved]..................................................................................49
Section 12.2 Optional Redemption.........................................................................49
Section 12.3 Notice to Trustee...........................................................................49
Section 12.4 Selection of Notes to be Redeemed...........................................................49
Section 12.5 Notice of Redemption........................................................................50
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Section 12.6 Effect of Notices of Redemption.............................................................51
Section 12.7 Deposit of Optional Redemption Price........................................................52
Section 12.8 Notes Redeemed in Part......................................................................52
Section 12.9 Conversion Arrangement on Call for Redemption...............................................52
Article XIII. REPURCHASE OF NOTES......................................................................................53
Section 13.1 Repurchase at the Option of the Holder on Specified Dates...................................53
Section 13.2 Repurchase at the Option of the Holder Upon a Designated Event..............................54
Section 13.3 [Reserved]..................................................................................55
Section 13.4 Notice of Optional Repurchase to be Provided by Issuer......................................55
Section 13.5 Notice of Withdrawal........................................................................56
Section 13.6 Payment of the Repurchase Price.............................................................56
Article XIV. CONVERSION OF NOTES......................................................................................57
Section 14.1 Conversion Right and Conversion Price.......................................................57
Section 14.2 Exercise of Conversion Right................................................................60
Section 14.3 Fractions of Shares.........................................................................63
Section 14.4 Adjustment of Conversion Price..............................................................63
Section 14.5 Notice of Adjustments of Conversion Price...................................................71
Section 14.6 Notice Prior to Certain Actions.............................................................72
Section 14.7 Company to Reserve Common Shares; Intercompany Agreement....................................73
Section 14.8 Taxes on Conversions........................................................................73
Section 14.9 Covenant as to Common Shares................................................................73
Section 14.10 Cancellation of Converted Notes.............................................................73
Section 14.11 Effect of Reclassification, Consolidation, Merger or Sale...................................73
Section 14.12 Responsibility of Trustee for Conversion Provisions.........................................75
Section 14.13 Limitation on Conversion Right..............................................................75
Section 14.14 Option to Satisfy Conversion Obligation with Cash, Common Shares or a
Combination Thereof.........................................................................76
Article XV. SUBORDINATION OF NOTES...................................................................................79
Section 15.1 Notes Subordinated to Senior Debt...........................................................79
Section 15.2 No Payment on Notes in Certain Circumstances................................................79
Section 15.3 Payment over of Proceeds upon Dissolution, Etc..............................................80
Section 15.4 Subrogation.................................................................................82
Section 15.5 Obligations of the Issuer Unconditional.....................................................82
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Section 15.6 Notice to Trustee...........................................................................82
Section 15.7 Reliance on Judicial Order or Certificate of Liquidating Agent..............................83
Section 15.8 Trustee's Relation to Senior Debt...........................................................83
Section 15.9 Subordination Rights Not Impaired by Acts or Omissions of the Issuer or
Holders of Senior Debt......................................................................84
Section 15.10 Holders Authorize Trustee to Effectuate the Subordination of the Notes......................84
Section 15.11 Not to Prevent Events of Default............................................................84
Section 15.12 Trustee's Compensation Not Prejudiced.......................................................84
Section 15.13 No Waiver of Subordination Provisions.......................................................84
Section 15.14 Payments May Be Paid Prior to Dissolution...................................................85
Article XVI. OTHER PROVISIONS OF GENERAL APPLICATION..................................................................85
Section 16.1 Trust Indenture Act Controls................................................................85
Section 16.2 Notices.....................................................................................85
Section 16.3 Communication by Holders With Other Holders.................................................86
Section 16.4 Acts of Holders of Notes....................................................................86
Section 16.5 Certificate and Opinion as to Conditions Precedent..........................................87
Section 16.6 Statements Required in Certificate or Opinion...............................................88
Section 16.7 Effect of Headings and Table of Contents....................................................88
Section 16.8 Successors and Assigns......................................................................88
Section 16.9 Separability Clause.........................................................................88
Section 16.10 Benefits of Indenture.......................................................................89
Section 16.11 Governing Law...............................................................................89
Section 16.12 Counterparts................................................................................89
Section 16.13 Legal Holidays..............................................................................89
Section 16.14 Recourse Against Others.....................................................................89
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EXHIBIT A FORM OF NOTE.................................................................................................A-1
EXHIBIT B-1 RESTRICTIVE SECURITIES LEGEND FOR NOTES.....................................................................B1-1
EXHIBIT B-2 RESTRICTIVE SECURITIES LEGEND FOR COMMON SHARES.............................................................B2-1
EXHIBIT B-3 GLOBAL NOTE LEGEND..........................................................................................B3-1
EXHIBIT C FORM OF NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT................................................C-1
EXHIBIT D FORM OF OPINION OF COUNSEL IN CONNECTION WITH REGISTRATION OF SECURITIES.....................................D-1
EXHIBIT E FORM OF NOTE GUARANTEE.......................................................................................E-1
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INDENTURE, dated as of October 4, 2004 among LIONS GATE
ENTERTAINMENT INC., a corporation duly organized and existing under the laws of
the State of Delaware, having its principal office at 2700 Colorado Avenue,
Suite 200, Santa Monica, California 90404 (the "Issuer"), LIONS GATE
ENTERTAINMENT CORP., a corporation duly organized and existing under the laws of
British Columbia, having its principal offices at 2700 Colorado Avenue, Suite
200, Santa Monica, California 90404 and 555 Brooksbank Avenue, North Vancouver,
British Columbia, V7J 3S5 (the "Company"), and J.P. MORGAN TRUST COMPANY,
NATIONAL ASSOCIATION, a national banking association duly organized and existing
under the laws of the United States, as Trustee (the "Trustee").
RECITALS OF THE ISSUER AND THE COMPANY
The Issuer and the Company have duly authorized the creation of an
issue of the Issuer's 2.9375% Convertible Senior Subordinated Notes due 2024
(the "Notes"), in substantially the tenor and amount hereinafter set forth, and
to provide therefor the Issuer and the Company have duly authorized the
execution and delivery of this Indenture.
All things necessary to make (i) the Notes, when the Notes are
executed by the Issuer and authenticated and delivered hereunder and duly issued
by the Issuer, guaranteed fully and unconditionally by the Company, the valid
obligations of the Issuer, guaranteed fully and unconditionally by the Company,
(ii) the Note Guarantee the valid obligation of the Company, and (iii) this
Indenture a valid agreement of the Issuer and the Company, in accordance with
their and its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Notes by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Notes, as follows.
ARTICLE I.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 DEFINITIONS.
"Acquiror" means, in a transaction that is a Change in Control, the
entity that acquires the Issuer or the Company, as the case may be.
"Act of Holders" when used with respect to any Holder of a Note, has
the meaning specified in Section 16.4(a) hereof.
"Additional Interest" means any and all additional interest payable
pursuant to Section 3 of the Registration Rights Agreement.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified
Person. For the purposes of this definition, "control", when used with respect
to any specified Person, means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent, Conversion Agent or
co-registrar.
"Applicable Stock Price" has the meaning specified in Section 14.14
hereof.
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar
federal, state or foreign law for the relief of debtors.
"Board of Directors" means either the board of directors of Issuer
or the Company, as the case may be, or any committee of such board empowered to
act for it with respect to this Indenture.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Issuer or the Company, as the case
may be, duly adopted by such Board of Directors and in full force and effect on
the date of such certification, and delivered to the Trustee.
"Business Day," when used with respect to any Place of Payment or
Place of Conversion, means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in that Place of Payment or
Place of Conversion, as the case may be, are authorized or obligated by law to
close.
"Capital Shares" means, with respect to any Person, any and all
shares, interests, participations or other equivalents (however designated,
whether voting or non-voting) in equity of such Person, whether now outstanding
or issued after the date of this Indenture, including, without limitation, all
common shares and preferred shares.
"Cash Amount" has the meaning specified in Section 14.14 hereof.
"Cash Settlement Averaging Period" has the meaning specified in
Section 14.14 hereof.
"Change in Control" means an event or series of events in which:
(a) any "person," including any syndicate or group deemed to be a
"person" under Section 13(d)(3) of the Exchange Act, acquires beneficial
ownership, directly or indirectly, of Capital Shares of the Company entitling
that person to exercise more than 50% of the total voting power of all of the
Capital Shares of the Company entitled to vote generally in elections of
directors (calculated without giving effect to any Common Shares issued or
issuable by the Company in payment of the Repurchase Price in Common Shares, as
contemplated in Section 13.6 hereof), other than any acquisition by the Company,
any Subsidiary or any employee benefit plan of the Company;
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(b) the Company (1) consolidates with or merges into any other
corporation or business entity or conveys or transfers or leases all or
substantially all of the assets of the Company to any other person, corporation
or business entity or any other corporation or business entity merges into the
Company (except solely to the extent necessary to reflect a change in the
jurisdiction of incorporation of the Company), and, in any such case, (2) the
holders of the Company's Capital Shares immediately before such transaction own,
directly or indirectly, less than 50% of the combined voting power of the
outstanding voting securities of the corporation or business entity resulting
from, or the transferee in, such transaction (calculated without giving effect
to any Common Shares issued or issuable by the Company in payment of the
Repurchase Price in Common Shares, as contemplated in Section 13.6 hereof);
(c) any "person," including any syndicate or group deemed to be a
"person" under Section 13(d)(3) of the Exchange Act, acquires beneficial
ownership, directly or indirectly, of the Issuer's Capital Shares entitling that
person to exercise more than 50% of the total voting power of all of the Capital
Shares of the Issuer entitled to vote generally in elections of directors
(calculated without giving effect to any Common Shares issued or issuable by the
Company in payment of the Repurchase Price in Common Shares, as contemplated in
Section 13.6 hereof), other than any acquisition by the Company, the Issuer or
any of the their respective Subsidiaries or any of their respective employee
benefit plans; or
(d) the Issuer (1) consolidates with or merges into any other
corporation or business entity or conveys or transfers or leases all or
substantially all of the assets of the Issuer to any other person, corporation
or business entity or any other corporation or business entity merges into the
Issuer (except solely to the extent necessary to reflect a change in
jurisdiction of incorporation of the Issuer or any parent of the Issuer), and,
in any such case, (2) the holders of the Issuer's Capital Shares immediately
before such transaction own, directly or indirectly, less than 50% of the
combined voting power of the outstanding voting securities of the corporation or
business entity resulting from, or the transferee in, such transaction
(calculated without giving effect to any Common Shares issued or issuable by the
Company in payment of the Repurchase Price in Common Shares, as contemplated in
Section 13.6 hereof);
provided, however, that a Change in Control shall not be deemed to occur if at
least 90% of the consideration in the Change in Control transaction consists of
Capital Shares traded primarily on the New York Stock Exchange or the American
Stock Exchange or quoted primarily on the Nasdaq National Market.
Beneficial ownership shall be determined in accordance with Rule
13d-3 promulgated by the SEC under the Exchange Act (except that a person will
be deemed to have beneficial ownership of all shares that such person has the
right to acquire, either immediately or with the passage of time). The term
"person" includes any syndicate or group that would be deemed to be a "person"
under Section 13(d)(3) of the Exchange Act. In determining beneficial ownership,
the Issuer may rely on Schedule 13D and Schedule 13G filings filed pursuant to
the Exchange Act.
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"Closing Price" of any security on any date of determination means:
(1) the closing sale price (or, if no closing sale price is
reported, the last reported sale price) of such security on the New York Stock
Exchange on such date;
(2) if such security is not listed for trading on the New York Stock
Exchange on any such date, the closing sale price as reported in the composite
transactions for the principal U.S. securities exchange on which such security
is so listed;
(3) if such security is not so listed on a U.S. national or regional
securities exchange, the last reported sale price as reported by the Nasdaq
National Market;
(4) if such security is not so reported, the last quoted bid price
for such security in the over-the-counter market as reported by the National
Quotation Bureau or similar organization; or
(5) if such bid price is not available, the average of the mid-point
of the last bid and ask prices of such security on such date from at least three
nationally recognized independent investment banking firms retained for this
purpose by the Issuer or Company.
"Common Shares" means any shares of any class of the Company which
has no preference in respect of dividends or of amounts payable in the event of
any voluntary or involuntary liquidation, dissolution or winding up of the
Company and which is not subject to redemption by the Company. However, subject
to the provisions of Section 14.11 hereof, shares issuable on conversion of
Notes shall include only shares of the class designated as Common Shares, no par
value per share, of the Company at the date of execution of this Indenture or
shares of any class or classes resulting from any reclassification or
reclassifications thereof and which have no preference in respect of dividends
or of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company and which are not subject to redemption
by the Company, provided that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable shall be
substantially in the proportion which the total number of shares of such class
resulting from all such reclassifications bears to the total number of shares of
all such classes resulting from all such reclassifications.
"Company" means the corporation named as the "Company" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation.
"Conversion Agent" has the meaning specified in Section 2.3 hereof.
"Conversion Date" has the meaning specified in Section 14.2 hereof.
"Conversion Notice" has the meaning specified in Section 14.2
hereof.
"Conversion Price" has the meaning specified in Section 14.1 hereof.
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"Conversion Obligation" has the meaning specified in Section 14.14
hereof.
"Conversion Rate" has the meaning specified in Section 14.1 hereof.
"Conversion Retraction Period" has the meaning specified in Section
14.14 hereof.
"Corporate Trust Office" means the office of the Trustee at which at
any particular time its corporate trust business shall be administered (which at
the date of execution of this Indenture is located at J.P. Morgan Trust Company,
National Association at 560 Mission Street, 13th Floor, San Francisco, CA 94105,
Attention: Corporate Trust Department and for purposes of Section 10.2 shall be
J.P. Morgan Trust Company, National Association, 4 New York Plaza, 1st Floor,
New York, NY 10004 Attention: Corporate Trust Department), or at any other time
at such other address as the Trustee may designate from time to time by notice
to the Company.
"Credit Facility Debt" means any and all amounts payable under or in
respect of Senior Bank Facilities, including principal, premium, if any,
interest (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Issuer or the Company whether
or not a claim for post-filing interest is allowed in such proceeding), fees,
charges, expenses, reimbursement obligations, guarantees and all other amounts
payable thereunder or in respect thereof, in an aggregate principal amount not
to exceed $340 million at any one time outstanding.
"Current Market Price" has the meaning specified in Section 14.4(g).
"Default" means an event which is, or after notice or lapse of time
or both would be, an Event of Default.
"Defaulted Interest" has the meaning specified in Section 2.12
hereof.
"Defaulted Interest Special Record Date" for the payment of any
Defaulted Interest means a date fixed by the Issuer pursuant to Section 2.12
hereof.
"Depositary" means The Depository Trust Company, its nominees and
their respective successors.
"Designated Event" means a Change in Control or a Termination of
Trading.
"Designated Event Repurchase Date" has the meaning specified in
Section 13.2 hereof.
"Designated Event Repurchase Price" has the meaning specified in
Section 13.2 hereof.
"Designated Event Repurchase Right" has the meaning specified in
Section 13.2 hereof.
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"Designated Senior Debt" means any Senior Debt (other than under any
Senior Bank Facility) in an original principal amount of not less than $50
million.
"Distribution Notice" has the meaning specified in Section 14.1
hereof.
"Dollar," "U.S. Dollar" or "U.S. $" means a dollar or other
equivalent unit in such coin or currency of the United States as at the time
shall be legal tender for the payment of public and private debts.
"Effective Date" has the meaning specified in Section 11.1 hereof.
"Event of Default" has the meaning specified in Section 5.1 hereof.
"Ex-Dividend Date" means, with respect to any distribution on
Common Shares, the first date on which the Common Shares trade regular way
on the principal securities market on which the Common Shares are then traded
without the right to receive such distribution.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Expiration Time" has the meaning specified in Section 14.4(f)
hereof.
"fair market value" has the meaning set forth in Section 14.4(g)
hereof.
"Global Note" has the meaning specified in Section 2.1(f) hereof.
"Holder" means the Person in whose name the Note is registered in
the Register.
"Indenture" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Initial Purchasers" means SG Cowen & Co., LLC and Thomas Weisel
Partners LLC.
"Interest Payment Date" means each April 15 and October 15,
beginning April 15, 2005.
"Issuer" means the corporation named as "Issuer" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Issuer" shall mean such successor corporation.
"Issuer Notice" has the meaning specified in Section 13.4 hereof.
"Make Whole Premium" has the meaning specified in Section 11.1
hereof.
"Make Whole Table" has the meaning specified in Section 11.1 hereof.
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"Market Price" shall be calculated by the Issuer and means the
average of the daily volume-weighted price of the Common Shares for the 20
consecutive trading-day period ending on the third Business Day prior to the
applicable Repurchase Date (or, if such third Business Day prior to the
applicable Repurchase Date is not a Trading Day, then ending on the last Trading
Day prior to such third Business Day), appropriately adjusted to take into
account the occurrence, during the period commencing on the first Trading Day
during the 20 trading-day period and ending on the Repurchase Date, of any event
that would result in an adjustment to the Conversion Rate, as described in
Section 14.4.
"Maturity Date" has the meaning specified in Section 2.1(b) hereof.
"Merger Notice" has the meaning specified in Section 14.1 hereof.
"Nasdaq National Market" means the National Association of
Securities Dealers Automated Quotation National Market or any successor national
securities exchange or automated over-the-counter trading market in the United
States.
"Non-Electing Share" has the meaning specified in Section 14.11
hereof.
"Note Guarantee" has the meaning specified in Section 3.1 hereof.
"Notes" has the meaning ascribed to it in the first paragraph under
the caption "Recitals of the Issuer and the Company."
"Obligations" has the meaning specified in Section 3.1 hereof.
"Officer" means the Chairman or Vice Chairman of the Board of
Directors, the Chief Executive Officer, the President, the Chief Financial
Officer, the Treasurer, any Vice President, the Secretary or Assistant Secretary
of the Issuer or the Company, as the case may be.
"Officers' Certificate" means a certificate from the Issuer or the
Company, as the case may be, signed by its (a) Chairman, Vice Chairman,
President, Chief Executive Officer, Chief Financial Officer or Vice President,
and (b) Treasurer, Assistant Treasurer, Secretary or Assistant Secretary, and
delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel to the Issuer and/or the Company, as the case may be (and may include
directors or employees of the Issuer or the Company, as the case may be), and
which opinion is acceptable to the Trustee.
"Optional Redemption" has the meaning specified in Section 12.2
hereof.
"Optional Redemption Date," when used with respect to any Note to be
redeemed pursuant to Section 12.2 hereof, means the date fixed for an Optional
Redemption by or pursuant to this Indenture.
"Optional Redemption Price" has the meaning specified in Section
12.2(b) hereof.
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"Order" means a written request or order signed in the name of the
Issuer by its Chairman of the Board of Directors, its President, its Chief
Executive Officer, its Chief Financial Officer or any Vice President, and
delivered to the Trustee.
"Participants" has the meaning specified in Section 2.15(a) hereof.
"Paying Agent" has the meaning specified in Section 2.3 hereof.
"Payment Blockage Period" has the meaning specified in Section
15.2(b) hereof.
"Payment Default" has the meaning specified in Section 5.1(d)(i)
hereof.
"Person" means an individual, partnership, corporation, limited
liability company, unincorporated organization, trust or joint venture, or any
entity similar to any of the foregoing organized under the laws of other
countries, or a governmental agency or political subdivision thereof.
"Physical Notes" has the meaning specified in Section 2.1(g) hereof.
"Place of Conversion" means any city in which any Conversion Agent
is located.
"Place of Payment" means any city in which any Paying Agent is
located.
"Predecessor Note" of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purposes of this definition, any Note
authenticated and delivered under Section 2.7 hereof in exchange for or in lieu
of a mutilated, destroyed, lost or stolen Note shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Note.
"Public Entity" means an entity with publicly-traded equity
securities that are listed on a United States national or regional securities
exchange, on NASDAQ or any similar U.S. system of automated dissemination of
quotations of securities prices.
"Purchase Agreement" means the Purchase Agreement, dated September
29, 2004, by and among the Company, the Issuer and the Initial Purchasers, as
amended.
"Purchased Shares" has the meaning specified in Section
14.4(f)(ii)(x) hereof.
"Purchasers" has the meaning specified in Section 12.9 hereof.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"Record Date" means either a Regular Record Date or a Special Record
Date, as the case may be, provided that, for purposes of Section 14.4 hereof,
Record Date has the meaning specified in 14.4(g) hereof.
"Redemption Date" means any Optional Redemption Date.
"Redemption Price" means any Optional Redemption Price.
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"Reference Period" has the meaning specified in Section 14.4(d)
hereof.
"Register" has the meaning specified in Section 2.5 hereof.
"Registrar" has the meaning specified in Section 2.3 hereof.
"Registration Default" has the meaning specified in Section 3 of the
Registration Rights Agreement.
"Registration Rights Agreement" means the registration rights
agreement, dated as of October 4, 2004, among the Issuer, the Company and the
Initial Purchasers.
"Regular Record Date" for the interest payable on the Notes
(including Additional Interest, if any) means the close of business on the April
1 or October 1 (whether or not a Business Day), as the case may be, preceding an
Interest Payment Date.
"Repurchase Date" means any Designated Event Repurchase Date or any
Special Repurchase Date, as the case may be.
"Repurchase Notice" has the meaning specified in Section 13.2
hereof.
"Repurchase Price" means any Designated Event Repurchase Price or
any Special Repurchase Price, as the case may be.
"Repurchase Right" means any Designated Event Repurchase Right or
any Special Repurchase Right, as the case may be.
"Responsible Officer," when used with respect to the Trustee, means
any officer of the Trustee, including any vice president, assistant vice
president, secretary, assistant secretary, the treasurer, any assistant
treasurer, or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Restricted Security" means a Note (or Common Share into which such
Note has been converted) that constitutes a "restricted security" within the
meaning of Rule 144(a)(3) under the Securities Act; provided, however, that the
Trustee shall be entitled to request and conclusively rely on any Opinion of
Counsel to the Issuer with respect to whether any Note (or Common Share into
which such Note has been converted) constitutes a Restricted Security.
"Restrictive Securities Legend" has the meaning specified in Section
2.17(a) hereof.
"Rule 144" means Rule 144 as promulgated under the Securities Act
(including any successor rule thereof), as the same may be amended from time to
time.
"Rule 144A" means Rule 144A as promulgated under the Securities Act
(including any successor rule thereof), as the same may be amended from time to
time.
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"SEC" means the Securities and Exchange Commission or any successor
thereto.
"Securities Act" means the Securities Act of 1933, as amended.
"Senior Bank Facilities" means the Amended and Restated Credit,
Security, Guaranty and Pledge Agreement among the Company the Issuer, as
Borrowers, certain Subsidiaries of the Company, as guarantors, and JPMorgan
Chase Bank and the other lenders referred to therein, dated as of December 15,
2003 (the "Current Facility") and any amendment, extension, modification or
waiver thereof, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including increasing amounts available for
borrowing thereunder or adding additional guarantors thereunder) all or any
portion of the Credit Facility Debt under such agreement or any successor or
replacement agreement, whether or not with the same lenders or agent, so long as
any such refinancing, or amendment, extension, modification or waiver of any
then existing financing (any such refinancing, or amendment, extension,
modification or waiver, a "Later Financing"), is secured by assets of the
Company or the Issuer or their respective subsidiaries; provided, however, that
the lack of any validity or enforceability of any lien or other security
interest purported to be granted in connection with such Later Financing shall
not affect the classification of such Later Financing as a Senior Bank Facility.
"Senior Debt" means any existing and future obligations of a Person
with respect to (i) Credit Facility Debt (ii) Vendor Financing Debt and (iii) to
the extent of the value of the assets securing the debt described in this clause
(iii), all secured financing in connection with motion picture and television
production and/or acquisition (including the rights of the entertainment guilds
pursuant to their collective bargaining agreements with the film and television
industries), and the acquisition of libraries and catalogues (either directly or
through acquisitions of entities whose principal assets consist of libraries
and/or catalogues).
"Senior Non-monetary Default" has the meaning specified in Section
15.2 hereof.
"Senior Payment Default" has the meaning specified in Section 15.2
hereof.
"Settlement Notice Period" has the meaning specified in Section
14.14 hereof.
"Shelf Registration Statement" has the meaning specified in the
Registration Rights Agreement.
"Significant Subsidiary" has the meaning specified in Rule 1-02(w)
under Regulation S-K promulgated by the SEC.
"Special Record Date" has the meaning specified in Section 8.4
hereof.
"Special Repurchase Date" has the meaning specified in Section 13.1
hereof.
"Special Repurchase Price" has the meaning specified in Section 13.1
hereof.
"Special Repurchase Right" has the meaning specified in Section 13.1
hereof.
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"Stock Price" has the meaning specified in Section 11.1 hereof.
"Stock Price Cap" has the meaning specified in Section 11.1 hereof.
"Stock Price Threshold" has the meaning specified in Section 11.1
hereof.
"Subsidiary" means a corporation more than 50% of the outstanding
Voting Shares of which are owned, directly or indirectly, by the Company or by
one or more other Subsidiaries, or by the Company and one or more other
Subsidiaries.
"Successor Company" has the meaning specified in Section 7.1.
"Termination of Trading" will be deemed to have occurred if the
Common Shares (or other common stock into which the Notes are convertible) are
neither listed for trading on a U.S. national securities exchange nor approved
for listing on the Nasdaq National Market or any similar U.S. system of
automated dissemination of quotations of securities prices, and no American
Depository Shares or similar instruments for such common stock are so listed or
approved for listing in the U.S.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code Section
77aaa-77bbbb), as in effect on the date of execution of this Indenture;
provided, however, that in the event the TIA is amended after such date, "TIA"
means, to the extent required by such amendment, the Trust Indenture Act of
1939, as so amended, or any successor statute.
"Trading Day" means:
(1) if the applicable security is listed or admitted for trading on
the New York Stock Exchange or another national security exchange, a day on
which the New York Stock Exchange or such other national security is open for
business;
(2) if the applicable security is quoted on the Nasdaq National
Market, a day on which trades may be made thereon; or
(3) if the applicable security is not so listed, admitted for
trading or quoted, any day other than a Saturday or Sunday or a day on which
banking institutions in the State of New York are authorized or obligated by law
or executive order to close.
"Trading Price" has the meaning specified in Section 14.1 hereof.
"Transfer Agent" means any Person, which may be the Company,
authorized by the Company to exchange or register the transfer of Notes,
initially Mellon Investor Services LLC.
"Trigger Event" has the meaning specified in Section 14.4(d) hereof.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
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"Vendor Financing Debt" means obligations of the Company or the
Issuer, directly or by guarantee, owing to Persons providing financing to any of
such entities, which Persons are bona fide suppliers of products or services to
such entities, in an aggregate principal amount not to exceed $75.0 million at
any one time outstanding for all such Persons. If at any time there are
obligations outstanding to all such Persons in a principal amount in excess of
$75.0 million, then the Vendor Financing Debt shall be allocated, as among the
holders of Vendor Financing Debt only, in accordance with a schedule provided by
the Issuer and the Company to the Trustee, or if no such schedule has been
provided, pro rata among the holders of the Vendor Financing Debt.
"Vice President" means any vice president of a corporation, whether
or not designated by a number or a word or words added before or after the title
"vice president."
"Voting Shares" means with respect to any Person, Capital Shares of
any class or kind ordinarily having the power to vote for the election of
directors, managers or other voting members of the governing body of such
Person.
"Withdrawal Notice" has the meaning specified in Section 13.5
hereto.
SECTION 1.2 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the
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:
"indenture securities" means the Notes;
"indenture security holder" means a Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee;
and
"obligor" on the Notes means the Issuer and the Company and any
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rules have
the meanings assigned to them by such definitions.
SECTION 1.3 RULES OF CONSTRUCTION.
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
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(2) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with accounting principles
generally accepted in the United States prevailing at the time of any relevant
computation hereunder; and
(3) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
ARTICLE II.
THE NOTES
SECTION 2.1 FORM AND DATING.
(a) The Notes shall be known and designated as the "2.9375%
Convertible Senior Subordinated Notes due 2024" of the Issuer. The aggregate
principal amount of Notes which may be authenticated and delivered under this
Indenture is limited to $150 million (including $25 million from the exercise in
full of the over-allotment option set forth in Section 8 of the Purchase
Agreement).
(b) The Notes shall mature on October 15, 2024 (the "Maturity
Date").
(c) Interest shall accrue from October 4, 2004 at a rate of 2.9375%
per annum until the principal thereof is paid or made available for payment
pursuant to the terms of this Indenture. Interest shall be payable semiannually
in arrears on April 15 and October 15 in each year, commencing April 15, 2005.
Interest on the Notes shall be computed on the basis of a 360-day
year comprised of twelve 30-day months, and, in the case of a partial month, the
actual number of days elapsed.
Except as provided in the next succeeding paragraph, a Holder of any
Note shall not be entitled to receive any interest (including Additional
Interest, if any) that has accrued on such Note if such Note is converted into
Common Shares on any day other than an Interest Payment Date. By delivering to
the Holder of any Note that is converted into Common Shares the number of shares
issuable upon conversion, together with a cash payment, if any, in lieu of a
fractional share, the Issuer and the Company shall be deemed to have satisfied
their obligation with respect to such Note. Accordingly, accrued but unpaid
interest shall be deemed to be paid in full rather than canceled, extinguished
or forfeited.
If a Holder of any Note converts such Note after a Regular Record
Date but prior to the corresponding Interest Payment Date, such Holder shall be
entitled to receive on the Interest Payment Date interest accrued and paid on
such Note, notwithstanding the conversion of such Note prior to such Interest
Payment Date. However, at the time such Holder surrenders such Note for
conversion, such Holder shall pay the Issuer an amount equal to the interest
(including Additional Interest, if any) that will be paid on the Notes being
converted on the Interest Payment Date. However, in the event that the Issuer
calls any Notes for redemption or a Holder exercises its Special Repurchase
Right for a Note on a date that is after a Record Date for an interest payment
but prior to the corresponding Interest Payment Date, and prior to such
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Redemption Date or Repurchase Date a Holder of any Note chooses to convert such
Note, such Holder shall not be required to pay the Issuer at the time such
Holder surrenders such Note for conversion the amount of interest on such Note
such Holder shall be entitled to receive on the date that has been fixed for
redemption if such Holder's conversion right would terminate because of the
redemption or repurchase between the Regular Record Date and the close of
business on the second Business Day following the next succeeding Interest
Payment Date. Accrued but unpaid interest will be payable upon any conversion of
Notes made concurrently with or after acceleration of the Notes following an
Event of Default.
Principal of, and premium, if any, and interest on, Global Notes
shall be payable to the Depositary in immediately available funds.
Principal and premium, if any, and interest on maturity, on Physical
Notes shall be payable at the office or agency of the Issuer maintained for such
purpose, initially the Corporate Trust Office of the Trustee. Interest on
Physical Notes (other than at maturity) will be payable by (i) U.S. Dollar check
drawn on a bank in The City of New York mailed to the address of the Holder, or
(ii) upon application to the Registrar not later than the relevant Record Date
by a Holder, of an aggregate principal amount in excess of $5,000,000, wire
transfer in immediately available funds.
(d) The Notes shall be guaranteed as to payment and performance of
conversion rights by the Company as provided in Article III; provided that
nothing herein shall require the Note Guarantee to be endorsed on any Note and
the failure to so endorse a Note Guarantee thereon shall not impair the validity
or enforceability of the Note Guarantee with respect to any such Note.
(e) The Notes and the Trustee's certificate of authentication shall
be substantially in the form set forth in EXHIBIT A, which is incorporated in
and forms a part of this Indenture. The Notes may have notations, legends or
endorsements required by law, stock exchange rule or usage. Each Note shall be
dated the date of its authentication.
(f) The Notes are being offered and sold in reliance on Rule 144A
under the Securities Act and shall be issued initially in the form of one or
more Global Notes, substantially in the form set forth in EXHIBIT A (the "Global
Note"), deposited with the Trustee, as custodian for the Depositary, duly
executed by the Company and authenticated by the Trustee as hereinafter provided
and bearing the legends set forth in EXHIBITS B-1, B-2 and B-3. The aggregate
principal amount of the Global Note may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depositary, as hereinafter provided; provided, however, that in no event
shall the aggregate principal amount of the Global Note or Notes exceed
$150,000,000.
(g) Notes issued in exchange for interests in a Global Note pursuant
to Section 2.15 may be issued in the form of permanent certificated Notes in
registered form in substantially the form set forth in EXHIBIT A (the "Physical
Notes") and, if applicable, bearing any legends required by Section 2.17.
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SECTION 2.2 EXECUTION AND AUTHENTICATION.
(a) One Officer of the Issuer shall sign the Notes for the Issuer by
manual or facsimile signature.
(b) If an Officer of the Issuer whose signature is on a Note no
longer holds that office at the time the Note is authenticated, the Note shall
nevertheless be valid.
(c) A Note shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Note has been authenticated under this Indenture.
(d) Upon an Order of the Issuer signed by one Officer of the Issuer,
the Trustee shall authenticate Notes for original issue in the aggregate
principal amount of $150,000,000. Such Officers' Certificate of the Issuer must
be received by the Trustee not later than the proposed date for delivery of such
additional Notes. The aggregate principal amount of Notes outstanding at any
time may not exceed $150,000,000 except as provided in Section 2.7 hereof.
(e) Upon an Order of the Issuer signed by two Officers of the
Issuer, the Trustee shall authenticate Notes not bearing the Restrictive
Securities Legend to be issued to the transferee when sold pursuant to an
effective registration statement under the Securities Act as set forth in
Section 2.16(c) hereof.
(f) The Trustee shall act as the initial authenticating agent.
Thereafter, the Trustee may appoint an authenticating agent acceptable to the
Issuer to authenticate Notes. An authenticating agent may authenticate Notes
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such Agent. An
authenticating agent has the same rights as an Agent to deal with the Issuer and
its Affiliates.
(g) The Notes shall be issuable only in registered form without
interest coupons and only in denominations of $1,000 principal amount and any
positive integral multiple thereof.
SECTION 2.3 REGISTRAR, PAYING AGENT AND CONVERSION AGENT.
(a) The Issuer shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar"), an office
or agency where Notes may be presented for payment ("Paying Agent") and an
office or agency where Notes may be presented for conversion ("Conversion
Agent"). The Registrar shall keep a register of the Notes and of their transfer
and exchange. The Issuer may appoint or change one or more co-registrars, one or
more additional paying agents and one or more additional conversion agents
without notice and may act in any such capacity on its own behalf. The term
"Registrar" includes any co-registrar; the term "Paying Agent" includes any
additional paying agent; and the term "Conversion Agent" includes any additional
conversion agent.
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(b) The Issuer shall enter into an appropriate agency agreement with
any Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent. The Issuer shall notify
the Trustee of the name and address of any Agent not a party to this Indenture.
If the Issuer fails to maintain a Registrar, Paying Agent or Conversion Agent,
the Trustee shall act as such. The Issuer or any Affiliate of the Issuer may act
as Paying Agent.
(c) The Issuer initially appoints the Trustee as Paying Agent and
Registrar and initially appoints the Company as Conversion Agent; provided that
within five (5) Business Days of the date hereof, the Issuer shall appoint as
Conversion Agent either (i) an entity that would be qualified to serve as the
Trustee under this Indenture in accordance with Article VI hereof or an
affiliate of such an entity or (ii) another entity not an affiliate of the
Issuer or the Company that is reasonably acceptable to the Trustee.
SECTION 2.4 PAYING AGENT TO HOLD MONEY IN TRUST.
Subject to Section 15.2, each Paying Agent shall hold in trust for
the benefit of the Holders or the Trustee all moneys held by the Paying Agent
for the payment of the Notes, and shall notify the Trustee of any default by the
Issuer in making any such payment. While any such default continues, the Trustee
may require a Paying Agent to pay all money held by it to the Trustee. The
Issuer at any time may require a Paying Agent to pay all money held by it to the
Trustee. Upon payment over to the Trustee, the Paying Agent shall have no
further liability for the money. If the Issuer acts as Paying Agent, it shall
segregate and hold as a separate trust fund all money held by it as Paying
Agent.
SECTION 2.5 HOLDER 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
Holders (the "Register"). If the Trustee is not the Registrar, the Issuer shall
furnish to the Trustee on or before each interest payment date and at such other
times as the Trustee may request in writing the Register.
SECTION 2.6 TRANSFER AND EXCHANGE.
(a) Subject to Sections 2.15 and 2.16 hereof, where Notes are
presented to the Registrar with a request to register their transfer or to
exchange them for an equal principal amount of Notes of other authorized
denominations, the Registrar shall register the transfer or make the exchange if
its requirements for such transaction are met. To permit registrations of
transfer and exchanges, the Trustee shall authenticate Notes at the Registrar's
request. The Issuer or the Trustee, as the case may be, shall not be required
(i) to issue, authenticate, register the transfer of or exchange any Note during
a period beginning at the opening of business 15 days before the mailing of a
notice of redemption of the Notes selected for redemption under Article XII
hereof and ending at the close of business on the day of such mailing or (ii) to
register the transfer of or exchange any Note so selected for redemption in
whole or in part, except the unredeemed portion of Notes being redeemed in part.
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(b) No service charge shall be made for any transfer, exchange or
conversion of Notes, but the Issuer may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any transfer, exchange or conversion of Notes, other than exchanges
pursuant to Sections 2.10, 12.6, 13.1, 13.2 or 14.2 not involving any transfer.
SECTION 2.7 REPLACEMENT NOTES.
(a) If the Holder claims that the Note has been mutilated, lost,
destroyed or stolen, the Issuer shall issue and the Trustee shall authenticate a
replacement Note if the Trustee's requirements are met and, in the case of a
mutilated Note, such mutilated Note is surrendered to the Trustee. In the case
of lost, destroyed or stolen Notes, if required by the Trustee, an indemnity
bond must be provided by the Holder that is sufficient in the judgment of the
Trustee to protect the Issuer, the Trustee or any Agent from any loss which any
of them may suffer if a Note is replaced. The Issuer may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation to replacing a Note and any other reasonable expenses (including the
reasonable fees and expenses of the Trustee) in connection therewith.
(b) In case any such mutilated, lost, destroyed or stolen Note has
become or is about to become due and payable, the Issuer in its discretion may,
instead of issuing a new Note, pay such Note when due.
(c) Every replacement Note is an additional obligation of the Issuer
only as provided in Section 2.8.
SECTION 2.8 OUTSTANDING NOTES.
(a) Notes outstanding at any time are all the Notes authenticated by
the Trustee except for those converted, those cancelled by it, those delivered
to it for cancellation and those described in this Section 2.8(a) as not
outstanding. Except to the extent provided in Section 2.9, a Note does not cease
to be outstanding because the Issuer or one of its subsidiaries or Affiliates
holds the Note.
(b) If a Note is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it, or a court
holds, that the replaced Note is held by a protected purchaser, as that term is
defined in the New York Uniform Commercial Code.
(c) If the Paying Agent (other than the Issuer or any Affiliate of
the Issuer) holds on a Redemption Date, Repurchase Date or Maturity Date money
sufficient to pay Notes payable on that date (or, if the Issuer acts as Paying
Agent, if the Issuer has segregated and holds such money in trust in accordance
with Section 2.4 hereof), then on and after that date, such Notes shall be
deemed to be no longer outstanding and interest on them shall cease to accrue,
and such Note shall be deemed paid whether or not the Note is delivered to the
Paying Agent. Thereafter, all other rights of the Holders of such Notes shall
terminate with respect to such Notes, other than the right to receive the
Redemption Price, Repurchase Price or principal amount, as applicable.
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(d) If a Note is converted in accordance with Article XIV hereof,
then from and after the time of conversion on the Conversion Date, such Note
will cease to be outstanding, and interest, if any, will cease to accrue on such
Note.
SECTION 2.9 NOTES HELD BY THE ISSUER OR AN AFFILIATE.
In determining whether the Holders of the required aggregate
principal amount of Notes have concurred in any direction, waiver or consent,
Notes owned by the Issuer or any of its subsidiaries or an Affiliate shall be
considered as though not outstanding, except that for the purposes of
determining whether a Responsible Officer of the Trustee shall be protected in
relying on any such direction, waiver or consent, only Notes which the Trustee
knows are so owned shall be so disregarded.
SECTION 2.10 TEMPORARY NOTES.
Until definitive Notes are ready for delivery, the Issuer may
prepare and the Trustee shall authenticate temporary Notes. Temporary Notes
shall be substantially in the form of definitive Notes but may have variations
that the Issuer considers appropriate for temporary Notes. Without unreasonable
delay, the Issuer shall prepare and the Trustee shall authenticate definitive
Notes in exchange for temporary Notes.
SECTION 2.11 CANCELLATION.
The Issuer at any time may deliver Notes to the Trustee for
cancellation. The Registrar, Paying Agent and Conversion Agent shall forward to
the Trustee any Notes surrendered to them for transfer, exchange, payment or
conversion. The Trustee shall cancel all Notes surrendered for transfer,
exchange, payment, conversion or cancellation in accordance with its customary
procedures. The Issuer may not issue new Notes to replace Notes that it has paid
or delivered to the Trustee for cancellation or that any Holder has converted
pursuant to Article XIV.
SECTION 2.12 DEFAULTED INTEREST.
If and to the extent the Issuer defaults in a payment of interest on
the Notes, the Issuer shall pay the defaulted interest in any lawful manner
plus, to the extent not prohibited by applicable statute or case law, interest
payable on the defaulted interest at the rate provided in the Notes (the
"Defaulted Interest"). The Issuer may pay the Defaulted Interest to the persons
who are Holders on a subsequent special record date fixed by the Issuer (a
"Defaulted Interest Special Record Date"). The Issuer shall fix such Defaulted
Interest Special Record Date and payment date. At least 15 days before the
Defaulted Interest Special Record Date, the Issuer shall mail to Holders a
notice that states the Defaulted Interest Special Record Date, payment date and
amount of interest to be paid.
SECTION 2.13 CUSIP NUMBERS.
The Issuer in issuing the Notes may use one or more "CUSIP" numbers,
and if so, the Trustee shall use the CUSIP numbers in notices of redemption or
exchange as a convenience to Holders; provided, however, that no representation
is hereby deemed to be made by the
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Trustee as to the correctness or accuracy of the CUSIP numbers printed in the
notice or on the Notes, and that reliance may be placed only on the other
identification numbers printed on the Notes. The Issuer shall promptly notify
the Trustee of any change in the CUSIP numbers.
SECTION 2.14 DEPOSIT OF MONEYS.
Prior to 11:00 A.M., New York City time, on each Interest Payment
Date, Maturity Date, Redemption Date and Repurchase Date, the Issuer shall have
deposited with a Paying Agent in immediately available funds money sufficient to
make cash payments, if any, due on such Interest Payment Date, Maturity Date,
Redemption Date and Repurchase Date, as the case may be, in a timely manner
which permits the Paying Agent to remit payment to the Holders on such Interest
Payment Date, Maturity Date, Redemption Date and Repurchase Date, as the case
may be.
SECTION 2.15 BOOK-ENTRY PROVISIONS FOR GLOBAL NOTES.
(a) The Global Notes initially shall (i) be registered in the name
of the Depositary or the nominee of such Depositary, (ii) be delivered to the
Trustee as custodian for such Depositary and (iii) bear legends as set forth in
Section 2.17.
Members of, or participants in, the Depositary ("Participants")
shall have no rights under this Indenture with respect to any Global Notes held
on their behalf by the Depositary, or the Trustee as its custodian, or under the
Global Notes, and the Depositary may be treated by the Issuer, the Trustee and
any agent of the Issuer or the Trustee as the absolute owner of the Global Notes
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Issuer, the Trustee or any agent of the Issuer or the Trustee from
giving effect to any written certification, proxy or other authorization
furnished by the Depositary or impair, as between the Depositary and
Participants, the operation of customary practices governing the exercise of the
rights of a Holder of any Notes.
(b) Transfers of Global Notes shall be limited to transfers in
whole, or in part, to the Depositary, its successors or their respective
nominees. In addition, Physical Notes shall be transferred to all beneficial
owners in exchange for their beneficial interests in Global Notes if (i) the
Depositary notifies the Issuer that it is unwilling or unable to continue as
Depositary for any Global Note and a successor Depositary is not appointed by
the Issuer within 90 days of such notice or (ii) an Event of Default has
occurred and is continuing and the Registrar has received a written request from
the Depositary to issue Physical Notes.
(c) In connection with the transfer of a Global Note in its entirety
to beneficial owners pursuant to Section 2.15(b), such Global Note shall be
deemed to be surrendered to the Trustee for cancellation, and the Issuer shall
execute, and the Trustee shall upon written instructions from the Issuer
authenticate and deliver, to each beneficial owner identified by the Depositary
in exchange for its beneficial interest in such Global Note, an equal aggregate
principal amount of Physical Notes of authorized denominations.
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(d) Any Physical Note constituting a Restricted Security delivered
in exchange for an interest in a Global Note pursuant to Section 2.15(b) shall,
except as otherwise provided by Section 2.16, bear the Restrictive Securities
Legend (as defined).
(e) The Holder of any Global Note may grant proxies and otherwise
authorize any Person, including Participants and Persons that may hold interests
through Participants, to take any action which a Holder is entitled to take
under this Indenture or the Notes.
SECTION 2.16 SPECIAL TRANSFER PROVISIONS.
(a) TRANSFERS TO QIBS. The following provisions shall apply with
respect to the registration of any proposed transfer of a Restricted Security to
a QIB:
(i) the Registrar shall register the transfer of any Restricted
Security, whether or not such Note bears the Restrictive Securities
Legend, if (x) the requested transfer is after the second anniversary of
the issue date for the Notes; provided, however, that neither the Company
nor any of its Affiliates has held any beneficial interest in such Note,
or portion thereof, at any time on or prior to the second anniversary of
the issue date for the Notes or (y) such transfer is being made by a
proposed transferor who has checked the box provided for on the form of
Note stating, or has otherwise advised the Issuer and the Registrar in
writing, that the sale has been made in compliance with the provisions of
Rule 144A to a transferee who has signed the certification provided for on
the form of Note stating, or has otherwise advised the Issuer and the
Registrar in writing, that it is purchasing the Note 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 QIB within the meaning of
Rule 144A, 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 Issuer as it 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 its foregoing representations in order to claim the exemption
from registration provided by Rule 144A; and
(ii) if the proposed transferor is a Participant seeking to transfer
an interest in one Global Note to a transferee who will hold such interest
in another Global Note, upon receipt by the Registrar of (x) written
instructions given in accordance with the Depositary's and the Registrar's
procedures and (y) the appropriate certificates and other documents, if
any, required by clause (y) of paragraph (i) above, the Registrar shall
register the transfer and reflect on its books and records the date and
(A) a decrease in the aggregate principal amount of the Global Note
through which the transferor held such interest in an amount equal to the
aggregate principal amount of the Notes to be transferred and (B) an
increase in the aggregate principal amount of the Global Note through
which the transferee proposes to hold such interest, in an amount equal to
the aggregate principal amount of the Notes to be transferred.
(b) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL NOTES.
Notwithstanding any other provisions of this Indenture, a Global Note may not be
transferred except as a whole or in part by the Depositary to a nominee of the
Depositary or by a nominee of
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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.
(c) RESTRICTIVE SECURITIES LEGEND. Upon the transfer, exchange or
replacement of Notes not bearing the Restrictive Securities Legend, the
Registrar or co-Registrar shall deliver Notes that do not bear the Restrictive
Securities Legend. Upon the transfer, exchange or replacement of Notes bearing
the Restrictive Securities Legend, the Registrar or co-Registrar shall deliver
only Notes that bear the Restrictive Securities Legend unless (i) the requested
transfer is after the second anniversary of the issue date for the Notes
(provided, however, that neither the Issuer nor any of its Affiliates has held
any beneficial interest in such Note, or portion thereof, at any time prior to
or on the second anniversary of the issue date), (ii) there is delivered to the
Trustee an Opinion of Counsel to the Issuer reasonably satisfactory to the
Issuer to the effect that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with the provisions of the
Securities Act or (iii) such Note has been sold pursuant to an effective
registration statement under the Securities Act and the Holder selling such
Notes has delivered to the Registrar or co-Registrar a notice in the form of
EXHIBIT C hereto. Upon the effectiveness of the Shelf Registration Statement (as
defined in the Registration Rights Agreement), the Issuer shall deliver to the
Trustee a notice of effectiveness, a Note or Notes, an authentication order in
accordance with Section 2.2 and an opinion of counsel in the form of EXHIBIT D
hereto and, if required by the Depositary, the Issuer shall deliver to the
Depositary a letter of representations in a form reasonably acceptable to the
Depositary.
(d) GENERAL. By its acceptance of any Note bearing the Restrictive
Securities Legend, each Holder of such a Note acknowledges the restrictions on
transfer of such Note set forth in this Indenture and in the Restrictive
Securities Legend and agrees that it will transfer such Note only as provided in
this Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to Section 2.15 or this Section 2.16.
The Issuer shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Registrar.
(e) TRANSFERS OF NOTES HELD BY AFFILIATES. Any certificate (i)
evidencing a Note that has been transferred to an Affiliate of the Issuer within
two years after the issue date for the Notes, as evidenced by a notation on the
Assignment Form for such transfer or in the representation letter delivered in
respect thereof or (ii) evidencing a Note that has been acquired from an
Affiliate (other than by an Affiliate) in a transaction or a chain of
transactions not involving any public offering, shall, until two years after the
last date on which the Issuer or any Affiliate of the Issuer was an owner of
such Note, in each case, bear the Restrictive Securities Legend, unless
otherwise agreed by the Company (with written notice thereof to the Trustee).
SECTION 2.17 RESTRICTIVE SECURITIES LEGENDS.
(a) Each Global Note and Physical Note that constitutes a Restricted
Security shall bear the legend (the "Restrictive Securities Legend") as set
forth in EXHIBIT B-1 on the face thereof until after the second anniversary of
the later of (i) the issue date for the Notes, and
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(ii) the last date on which the Issuer or any Affiliate of the Issuer was the
owner of such Note (or any predecessor security) (or such shorter period of time
as permitted by Rule 144(k) under the Securities Act or any successor provision
thereunder) (or such longer period of time as may be required under the
Securities Act or applicable state securities laws in the opinion of counsel for
the Issuer, unless otherwise agreed between the Issuer and the Holder thereof).
(b) Each Common Share that constitutes a Restricted Security shall
bear the Restrictive Securities Legend as set forth in EXHIBIT B-2 on the
reverse thereof until after the second anniversary of the later of (i) the issue
date for the Common Share, and (ii) the last date on which the Issuer or any
Affiliate of the Issuer was the owner of such Common Share (or any predecessor
security) (or such shorter period of time as permitted by Rule 144(k) under the
Securities Act or any successor provision thereunder) (or such longer period of
time as may be required under the Securities Act or applicable state securities
laws in the opinion of counsel for the Issuer, unless otherwise agreed between
the Issuer and the Holder thereof).
(c) Each Global Note shall also bear the legend as set forth in
EXHIBIT B-3.
ARTICLE III.
NOTE GUARANTEE
SECTION 3.1 NOTE GUARANTEE.
The Company hereby fully and unconditionally guarantees, as primary
obligor and not merely as surety, to each Holder and the Trustee, the payment of
principal and interest on the Notes and the Repurchase Price, if applicable,
with respect to any Note (the "Obligations") on an unsecured senior subordinated
basis (the "Note Guarantee"). The Note Guarantee ranks junior to all existing
and future Senior Debt of the Company. The Note Guarantee is effectively
subordinated to all indebtedness and other liabilities of all Subsidiaries of
the Company (other than the Issuer). Other than as set out above, the Note
Guarantee ranks equally in right of payment with all of the Company's other
existing and future liabilities that are not secured or are not otherwise
subordinated in favor of the Note Guarantee.
The Company waives presentation to, demand of payment from and
protest to the Issuer of any of the Obligations and also waives notice of
protest for nonpayment. The Company waives notice of any default under the Notes
or the Obligations. The obligations of the Company hereunder shall not be
affected by (a) the failure of any Holder or the Trustee to assert any claim or
demand or to enforce any right or remedy against the Issuer or any other Person
under this Indenture, the Notes or any other agreement or otherwise; (b) any
extension or renewal of any thereof; (c) any rescission, waiver, amendment or
modification of any of the terms or provisions of this Indenture, the Notes or
any other agreement; (d) the release of any security held by any Holder or the
Trustee for the Obligations or any of them; or (e) any Change in Control of the
Issuer.
The Company further agrees that the Note Guarantee herein
constitutes a guarantee of payment when due (and not a guarantee of collection)
and waives any right to
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require that any resort be had by any Holder or the Trustee to any security held
for payment of any Obligations.
The obligations of the Company hereunder shall not be subject to any
reduction, limitation, impairment or termination for any reason (other than
payment or performance of the Obligations in full), including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense of setoff, counterclaim, recoupment or termination whatsoever or
by reason of the invalidity, illegality or unenforceability of the Obligations
or otherwise. Without limiting the generality of the foregoing, the obligations
of the Company herein shall not be discharged or impaired or otherwise affected
by the failure of any Holder to assert any claim or demand or to enforce any
remedy under this Indenture, the Notes or any other agreement, by any waiver or
modification of any thereof, by any default, failure or delay, willful or
otherwise, in the performance of the Obligations, or by any other act or thing
or omission or delay to do any other act or thing which may or might in any
manner or to any extent vary the risk of the Company or would otherwise operate
as a discharge of the Company as a matter of law or equity.
The Company further agrees that the Note Guarantee herein shall
continue to be effective or be reinstated, as the case may be, if at any time
payment, or any part thereof, of principal of, or interest on any of the
Obligations is rescinded or must otherwise be restored by any Holder upon the
bankruptcy or reorganization of the Company or otherwise.
In furtherance of the foregoing and not in limitation of any other
right which any Holder has at law or in equity against the Company by virtue
hereof, upon the failure of the Company to pay any of the Obligations when and
as the same shall become due, whether at maturity, by acceleration, by
redemption or otherwise, the Company hereby promises to and will, upon receipt
of written demand by the Trustee, forthwith pay, or cause to be paid, in cash,
to the Trustee an amount equal to the sum of (i) the unpaid amount of such
Obligations then due and owing and (ii) accrued and unpaid interest on such
Obligations then due and owing (but only to the extent not prohibited by law).
The Company further agrees that, as between the Company, on the one
hand, and the Holders, on the other hand, (x) the maturity of any Obligations
may be accelerated as provided in this Indenture for the purposes of the Note
Guarantee herein, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of any Obligations and (y) in the event
of any such declaration of acceleration of such Obligations, such Obligations
(whether or not due and payable) shall forthwith become due and payable by the
Company for the purposes of this Note Guarantee.
The Company also agrees to pay any and all reasonable costs and
expenses (including reasonable attorneys' fees) incurred by the Trustee or the
Holders in enforcing any rights under this Section 3.1.
SECTION 3.2 CONSIDERATION.
The Company has received, or will receive, direct or indirect
benefits from the making of the Note Guarantee.
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SECTION 3.3 EXECUTION OF GUARANTEE.
To evidence the Note Guarantee to the Holders set forth in this
Article III, the Company hereby agrees to execute the Note Guarantee in
substantially the form attached hereto as EXHIBIT E, which shall be endorsed on
each Note ordered to be authenticated and delivered by the Trustee. The Company
hereby agrees that the Note Guarantee set forth in this Article III shall remain
in full force and effect notwithstanding any failure to endorse on each Note a
notation of such Note Guarantee. The Note Guarantee shall be signed on behalf of
the Company by one of its authorized Officers prior to the authentication of the
Note on which it is endorsed, and the delivery of such Note by the Trustee,
after the authentication thereof hereunder, shall constitute due delivery of the
Note Guarantee on behalf of the Company. Such signatures upon the Note Guarantee
may be by manual or facsimile signature of such officers and may be imprinted or
otherwise reproduced on the Note Guarantee, and in case any such officer who
shall have signed the Note Guarantee shall cease to be such officer before the
Note on which such Note Guarantee is endorsed shall have been authenticated and
delivered by the Trustee or disposed of by the Issuer, such Note nevertheless
may be authenticated and delivered or disposed of as though the Person who
signed the Note Guarantee had not ceased to be such officer of the Company.
SECTION 3.4 SUCCESSOR GUARANTEE.
In the event that the Company consolidates with, merges with or
into, or sells, conveys, transfers, leases or otherwise disposes of all or
substantially all of its property and assets (in one transaction or a series of
related transactions) to any Person and the Company is not the surviving entity,
such surviving entity shall expressly assume all of the obligations of the
Company under to this Article III and shall execute a Note Guarantee to evidence
such obligation.
ARTICLE IV.
SATISFACTION AND DISCHARGE
SECTION 4.1 SATISFACTION AND DISCHARGE OF INDENTURE.
When:
(1) the Issuer shall deliver to the Trustee for cancellation
all Notes previously authenticated (other than any Notes which have been
destroyed, lost or stolen and in lieu of, or in substitution for which,
other Notes shall have been authenticated and delivered) and not
previously canceled, or
(2) the Issuer shall deposit with the Trustee, within one year
before the Notes have become due and payable, whether at stated maturity
or any other Redemption Date, or within one year of the Notes being
scheduled for conversion or otherwise, cash or Common Shares, pursuant to
Article XIV, sufficient to pay all of the outstanding Notes and all other
sums payable by the Issuer under this Indenture, and
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if, in the case of either clause (1), or (2), the Issuer shall also
pay or cause to be paid all other sums payable hereunder by the Issuer, then
this Indenture shall cease to be of further effect (except as to:
(i) remaining rights of registration of transfer, substitution
and exchange and conversion of Notes, (ii) rights hereunder of Holders to
receive payments of principal of and premium, if any, and interest
(including Additional Interest, if any) on, the Notes and the other
rights, duties and obligations of Holders, as beneficiaries hereof with
respect to the amounts, if any, so deposited with the Trustee, and
(ii) the rights, obligations and immunities of the Trustee
hereunder), and the Trustee, on written demand of the Issuer accompanied
by an Officers' Certificate and an Opinion of Counsel (each stating that
all conditions precedent herein relating to the satisfaction and discharge
of this Indenture have been complied with) and at the cost and expense of
the Issuer, shall execute proper instruments acknowledging satisfaction of
and discharging this Indenture; provided, however, the Issuer shall
reimburse the Trustee for all amounts due the Trustee under Section 5.8
and Section 6.7 hereof and for any costs or expenses thereafter reasonably
and properly incurred by the Trustee and to compensate the Trustee for any
services thereafter reasonably and properly rendered by the Trustee in
connection with this Indenture or the Notes.
SECTION 4.2 DEPOSITED MONIES TO BE HELD IN TRUST.
Subject to Section 4.3 hereof, all monies deposited with the Trustee
pursuant to Section 4.1 hereof shall be held in trust and applied by it to the
payment, notwithstanding the provisions of Article XIV hereof, either directly
or through any Paying Agent (including the Issuer if acting as its own Paying
Agent), to the Holders of the particular Notes for the payment or redemption of
which such monies have been deposited with the Trustee, of all sums due and to
become due thereon for principal, premium, if any, and interest (including
Additional Interest, if any). All monies deposited with the Trustee pursuant to
Section 4.1 hereof (and held by it or any Paying Agent) for the payment of Notes
subsequently converted shall be returned to the Issuer upon request of the
Issuer.
SECTION 4.3 RETURN OF UNCLAIMED MONIES.
Anything contained herein to the contrary notwithstanding, and
subject to any applicable law, any money held by the Trustee in trust for the
payment and discharge of the principal, interest (including Additional Interest,
if any) or premium, if any, on any of the Notes which remains unclaimed for two
years after the date when each payment of such principal, interest and premium
has become payable shall be repaid within sixty days of such date by the Trustee
to the Issuer as its absolute property free from trust, and the Trustee shall
thereupon be released and discharged with respect thereto and the Holders shall
look only to the Issuer for the payment of the principal, interest (including
Additional Interest, if any) and premium, if any, on such Notes. The Issuer may
cause, or, if requested by the Issuer, the Trustee shall cause notice of such
payment to the Issuer to be mailed to each Holder of a Note entitled thereto
prior to such payment. The Trustee shall not be liable to the Issuer or any
Holder for interest on funds held by it for the payment and discharge of the
principal, interest (including Additional Interest, if any)
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or premium, if any, on of any of the Notes to any Holder. The Issuer shall not
be liable for any interest on the sums paid to it pursuant to this paragraph and
shall not be regarded as a trustee of such money.
ARTICLE V.
DEFAULTS AND REMEDIES
SECTION 5.1 EVENTS OF DEFAULT.
An "Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(a) default in the payment of principal of (or premium, if any, on)
any Note at its stated maturity, upon redemption or exercise of a Repurchase
Right or otherwise;
(b) default in the payment of interest or Additional Interest, if
any, on any Note when due and payable and continuance of such default for a
period of 30 days;
(c) default in the performance or breach of any term, covenant or
agreement of the Issuer or the Company in this Indenture or under the Notes and
continuance of such default or breach for a period of 60 consecutive days after
there has been given, by registered or certified mail, to the Issuer or the
Company by the Trustee or to the Issuer or the Company and the Trustee by the
Holders of at least 25% in principal amount of the outstanding Notes a written
notice specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder;
(d) a default occurs under any mortgage, indenture or instrument
under which there may be issued or by which there may be secured or evidenced
any indebtedness for money borrowed by the Issuer, the Company or any of the
Company's Significant Subsidiaries, whether such indebtedness now exists or
shall be created hereafter, which default (i) is caused by a failure to pay
principal of such indebtedness by the end of the applicable grace period, if
any, unless such indebtedness is discharged (a "Payment Default") or (ii)
results in the acceleration of such indebtedness, unless such acceleration is
waived, cured, rescinded or annulled, the principal amount of any such
indebtedness, together with the principal amount of any other such indebtedness
under which there is then existing a Payment Default or the maturity of which
has been so accelerated, aggregates $10 million or more;
(e) a court having jurisdiction in the premises enters a decree or
order for (A) relief in respect of the Issuer, the Company or any of the
Company's Significant Subsidiaries in an involuntary case under any applicable
bankruptcy or other similar law now or hereafter in effect, (B) appointment of a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of the Issuer, the Company or any of the Company's Significant
Subsidiaries or (C) the winding up or liquidation of the affairs of the Issuer,
the Company or any of the
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Company's Significant Subsidiaries and, in each case, such decree or order shall
remain unstayed and in effect for a period of 30 consecutive days;
(f) the Issuer, the Company or any of the Company's Significant
Subsidiaries (A) commences a voluntary case under any applicable bankruptcy or
other similar law now or hereafter in effect, or consents to the entry of an
order for relief in an involuntary case under any such law, (B) consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Issuer, the Company
or any of the Company's Significant Subsidiaries or for all or substantially all
of the property and assets of the Issuer, the Company or any of the Company's
Significant Subsidiaries or (C) effects any general assignment for the benefit
of creditors; or
(g) failure by the Issuer or the Company to provide the notice
required under this Indenture upon a Designated Event.
SECTION 5.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.
(a) If an Event of Default with respect to outstanding Notes (other
than an Event of Default with respect to the Issuer or the Company specified in
Section 5.1(e) or 5.1(f) hereof) occurs and is continuing and has not been cured
or waived in accordance with this Indenture, the Trustee or the Holders of at
least 25% in aggregate principal amount of the outstanding Notes, by written
notice to the Issuer or the Company specifying such Event of Default and
requiring it to be remedied and stating that such notice is a "Notice of
Default" hereunder, may declare due and payable 100% of the principal amount of
all outstanding Notes plus any accrued and unpaid interest to the date of
payment. Upon a declaration of acceleration, such principal and accrued and
unpaid interest to the date of payment shall be immediately due and payable.
(b) If an Event of Default with respect to the Issuer or the Company
specified in Section 5.1(e) or 5.1(f) hereof occurs, all unpaid principal and
accrued and unpaid interest (including Additional Interest, if any) on the
outstanding Notes shall become and be immediately due and payable, without any
declaration or other act on the part of the Trustee or any Holder.
(c) The Holders, either (a) through the written consent of not less
than a majority in aggregate principal amount of the outstanding Notes, or (b)
by the adoption of a resolution by Holders of a majority in aggregate principal
amount of the outstanding Notes represented at a meeting of Holders at which a
quorum (as prescribed in Section 9.4) is present, may rescind and annul an
acceleration and its consequences if:
(1) all existing Events of Default, other than the nonpayment
of principal of or interest (including Additional Interest, if any) on the
Notes which have become due solely because of the acceleration, have been
remedied, cured or waived, and
(2) the rescission would not conflict with any judgment or
decree of a court of competent jurisdiction;
provided, however, that in the event of a declaration of acceleration in respect
of the Notes because of an Event of Default specified in Section 5.1(d) shall
have occurred and be continuing,
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such declaration of acceleration shall be automatically rescinded and annulled
if the indebtedness that is the subject of such Event of Default has been
discharged or the holders thereof have waived, cured, rescinded or annulled
their declaration of acceleration in respect of such indebtedness, and written
notice of such discharge or waiver, cure, rescission or annulment as the case
may be, shall have been given to the Trustee by the Issuer and countersigned by
the holders of such indebtedness or a trustee, fiduciary or agent for such
holders, within 30 days after such declaration of acceleration in respect of the
Notes and no other Event of Default has occurred during such 30-day period which
has not been cured or waived during such period.
SECTION 5.3 OTHER REMEDIES.
If an Event of Default with respect to outstanding Notes occurs and
is continuing, the Trustee may, in its discretion, pursue any available remedy
by proceeding at law or in equity to collect the payment of principal of or
interest on the Notes or to enforce the performance of any provision of the
Notes.
The Trustee may maintain a proceeding in which it may prosecute and
enforce all rights of action and claims under this Indenture or the Notes, even
if it does not possess any of the Notes or does not produce any of them in the
proceeding.
SECTION 5.4 WAIVER OF PAST DEFAULTS.
The Holders, either (a) through the written consent of not less than
a majority in aggregate principal amount of the outstanding Notes, or (b) by the
adoption of a resolution, at a meeting of Holders of the outstanding Notes at
which a quorum (as prescribed in Section 9.4) is present, by the Holders of at
least a majority in aggregate principal amount of the outstanding Notes
represented at such meeting, may, on behalf of the Holders of all of the Notes,
waive an existing Default or Event of Default, except a Default or Event of
Default:
(1) in the payment of the principal of or premium, if any, or
interest (including Additional Interest, if any) on any Note (provided,
however, that subject to Section 5.7 hereof, the Holders of a majority in
aggregate principal amount of the outstanding Notes may rescind an
acceleration and its consequences, including any related payment default
that resulted from such acceleration);
(2) in respect of a covenant or provision hereof which, under
Section 8.2 hereof, including Section 8.2(g), cannot be modified or
amended without the consent of the Holders of each outstanding Note
affected.
Upon any such waiver, such Default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; provided, however, that no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereon.
SECTION 5.5 CONTROL BY MAJORITY.
The Holders of a majority in aggregate principal amount of the
outstanding Notes (or such lesser amount as shall have acted at a meeting
pursuant to the provisions of this
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Indenture) shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee. However, the Trustee may refuse to
follow any direction that:
(1) conflicts with any law or with this Indenture;
(2) the Trustee determines may be unduly prejudicial to the
rights of the Holders not joining therein, or
(3) may expose the Trustee to personal liability.
The Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 5.6 LIMITATION ON SUIT.
No Holder of any Note shall have any right to pursue any remedy with
respect to this Indenture or the Notes (including, instituting any proceeding,
judicial or otherwise, with respect to this Indenture or for the appointment of
a receiver or trustee) unless:
(1) such Holder has previously given written notice to the
Trustee of an Event of Default that is continuing;
(2) the Holder of at least 25% in aggregate principal amount
of the outstanding Notes shall have made written request to the Trustee to
pursue the remedy;
(3) such Holder or Holders have offered to the Trustee
indemnity satisfactory to it against any costs, expenses and liabilities
incurred in complying with such request;
(4) the Trustee has failed to comply with the request for 60
days after its receipt of such notice, request and offer of indemnity; and
(5) during such 60-day period, no direction inconsistent with
such written request has been given to the Trustee by the Holders of a
majority in aggregate principal amount of the outstanding Notes (or such
amount as shall have acted at a meeting pursuant to the provisions of this
Indenture);
provided, however, that no one or more of such Holders may use this Indenture to
prejudice the rights of another Holder (including conversion rights) or to
obtain preference or priority over another Holder.
SECTION 5.7 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision in this Indenture, the Holder of
any Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of and premium, if any, and interest including
Additional Interest, if any, on such Note on the stated maturity expressed in
such Note, in the case of redemption, on the Redemption Date, and in the
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case of the exercise of a Repurchase Right, on the Repurchase Date, and to bring
suit for the enforcement of any such payment on or after such respective dates,
and such right shall not be impaired or affected without the consent of such
Holder.
SECTION 5.8 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY THE TRUSTEE.
Each of the Issuer and Company, jointly and severally, covenants
that if:
(1) a default is made in the payment of any interest
(including Additional Interest, if any) on any Note when such interest
(including Additional Interest, if any) becomes due and payable and such
default continues for a period of 30 days, or
(2) a default is made in the payment of the principal of or
premium, if any, on any Note at the maturity thereof,
the Issuer and the Company will, upon demand of the Trustee, pay to it, for the
benefit of the Holders of such Notes, the whole amount then due and payable (as
expressed therein or as a result of any acceleration effected pursuant to
Section 5.2 hereof) on such Notes for principal and premium, if any, and
interest (including Additional Interest, if any) and, to the extent that payment
of such interest shall be legally enforceable, interest on any overdue principal
and premium, if any, and on any overdue interest (including Additional Interest,
if any), calculated using the Interest Rate, and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
If the Issuer and the Company fail to pay such amounts forthwith
upon such demand, the Trustee, in its own name and as trustee of an express
trust, may institute a judicial proceeding for the collection of the sums so due
and unpaid, may prosecute such proceeding to judgment or final decree and may
enforce the same against the Issuer and/or the Company and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Issuer and/or the Company, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders of Notes by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 5.9 TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Issuer or the Company or the property
of the Issuer or the Company or its creditors, the Trustee (irrespective of
whether the principal of the Notes 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 Issuer or the Company for the payment of
overdue principal or interest
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(including Additional Interest, if any)) shall be entitled and empowered, by
intervention in such proceeding or otherwise,
(1) to file and prove a claim for the whole amount of
principal and premium, if any, and interest (including Additional
Interest, if any) owing and unpaid in respect of the Notes 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) and of the Holders of Notes allowed in such judicial
proceeding, and
(2) to collect and receive any moneys or other property
payable or deliverable on any such claim and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceedings is hereby authorized by
each Holder of Notes to make such payments to the Trustee and, in the event that
the Trustee shall consent to the making of such payments directly to the Holders
of Notes, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel and any other amounts due the Trustee under Section 5.8.
Nothing contained herein shall be deemed to authorize the Trustee to
authorize or consent to or accept, or adopt on behalf of any Holder of a Note,
any plan of reorganization, arrangement, adjustment or composition affecting the
Notes or the rights of any Holder thereof or to authorize the Trustee to vote in
respect of the claim of any Holder of a Note in any such proceeding.
SECTION 5.10 RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder of a Note has instituted any proceeding
to enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Issuer, the Company, the Trustee and the
Holders of Notes shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the Trustee and
the Holders shall continue as though no such proceeding had been instituted.
SECTION 5.11 RIGHTS AND REMEDIES CUMULATIVE.
No right or remedy conferred in this Indenture upon or reserved to
the Trustee or to the Holders of Notes is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given
hereunder or hereafter existing at law or in equity or otherwise. The assertion
or employment of any right or remedy hereunder, or otherwise, shall not prevent
the concurrent assertion or employment of any other appropriate right or remedy.
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SECTION 5.12 DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Holder of any Note to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or any
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Holders of Notes may be exercised from time to time, and
as often as may be deemed expedient, by the Trustee or by the Holders of Notes,
as the case may be.
SECTION 5.13 APPLICATION OF MONEY COLLECTED.
Subject to Article XIII, any money collected by the Trustee pursuant
to this Article shall be applied in the following order, at the date or dates
fixed by the Trustee and, in case of the distribution of such money on account
of principal or premium, if any, or interest (including Additional Interest, if
any), upon presentation of the Notes and the notation thereon of the payment if
only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee;
SECOND: To the payment of the amounts then due and unpaid for
principal of and premium, if any, and interest (including Additional Interest,
if any) on the Notes in respect of which or for the benefit of which such money
has been collected, ratably, without preference or priority of any kind,
according to the amounts due and payable on such Notes for principal and
premium, if any, and interest (including Additional Interest, if any),
respectively; and
THIRD: Any remaining amounts shall be repaid to the Issuer.
SECTION 5.14 UNDERTAKING FOR COSTS.
All parties to this Indenture agree, and each Holder of any Note by
such Holder's acceptance thereof shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Indenture, or in any suit against the Trustee for any action
taken, suffered or omitted by it as Trustee, the filing by any party litigant in
such suit of an undertaking to pay the costs of such suit, and that such court
may in its discretion assess reasonable costs, including reasonable attorneys'
fees, against any party litigant in such suit, having due regard to the merits
and good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in aggregate principal amount of the outstanding
Notes, or to any suit instituted by any Holder of any Note for the enforcement
of the payment of the principal of or premium, if any, or interest (including
Additional Interest, if any) on any Note on or after the stated maturity
expressed in such Note (or, in the case of redemption or exercise of a
Repurchase Right, on or after the Redemption Date) or for the enforcement of the
right to convert any Note in accordance with Article XIV.
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SECTION 5.15 WAIVER OF STAY OR EXTENSION LAWS.
Each of the Issuer and the Company, jointly and severally, 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 to take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Issuer and the Company (to the extent that they may lawfully
do so) hereby expressly waive all benefit or advantage of any such law and
covenants that they 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 VI.
THE TRUSTEE
SECTION 6.1 DUTIES OF TRUSTEE.
(a) If 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.
(b) Except during the continuance of an Event of Default:
(i) the Trustee need perform only those duties that are specifically
set forth in this Indenture and no implied covenants or obligations shall
be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith, willful misconduct or negligence
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 examine the certificates and
opinions to determine whether or not they conform to the requirements of
this Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) the Trustee shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(ii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.5.
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(d) Every provision of this Indenture that in any way relates to the
Trustee in any of its roles hereunder is subject to the provisions of this
Section 6.1.
(e) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Issuer. Money
held in trust by the Trustee need not be segregated from other funds except to
the extent required by law.
SECTION 6.2 RIGHTS OF TRUSTEE.
(a) Subject to Section 6.1, the Trustee may conclusively rely on any
document believed by it to be genuine and to have been signed or presented by
the proper person. The Trustee need not investigate any fact or matter stated in
the document; if, however, the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled during normal business hours to
examine the relevant books, records and premises of the Issuer, personally or by
agent or attorney upon reasonable prior notice.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate of the Issuer and/or an Opinion of Counsel to the
Issuer. The Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on such Officers' Certificate of the Issuer or Opinion
of Counsel to the Company.
(c) Any request or direction of the Issuer mentioned herein shall be
sufficiently evidenced by an Issuer Order and any resolution of the Board of
Directors of the Issuer shall be sufficiently evidenced by a Board Resolution of
the Issuer.
(d) The Trustee may consult with counsel and the advice of such
counsel or any Opinion of Counsel of the Issuer shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.
(e) The Trustee 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.
(f) 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
discretion, rights or powers conferred upon it by this Indenture.
(g) Except with respect to Section 6.1, the Trustee shall have no
duty to inquire as to the performance of the Issuer with respect to the
covenants contained in Article X hereof. In addition, the Trustee shall not be
deemed to have knowledge of an Event of Default except (i) any Default or Event
of Default occurring pursuant to Sections 5.1(a) and 5.1(b) or (ii) any Default
or Event of Default of which a Responsible Officer of the Trustee shall have
received written notification or obtained actual knowledge. Delivery of reports,
information and documents to the Trustee under Article X (other than Sections
10.4 and 10.7) is for informational purposes only and the Trustee's receipt of
the foregoing shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Issuer's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates of the
Issuer).
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(h) The Trustee shall be under no obligation to exercise any of the
rights or powers vested 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 reasonably 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 rights, privileges, protections, immunities and benefits
given to the Trustee, including without limitation, its right to be indemnified,
are extended to, and shall be enforceable by, the Trustee in each of its
capacities hereunder, and its directors, officers, employees and each agent,
custodian and other Person employed to act hereunder.
(j) The Trustee may request that the Issuer deliver an Officers'
Certificate of the Issuer 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 of the Issuer, including any person specified as
so authorized in any such certificate previously delivered and not superseded.
(k) 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 its duties hereunder or in the exercise of any of its rights or
powers.
(l) No permissive power, right or remedy conferred upon the Trustee
hereunder shall be construed to impose a duty to exercise such power, right or
remedy.
(m) The Trustee shall have no duty to monitor or inquire as to the
performance of the Issuer or Holders with respect to the Registration Rights
Agreement. The Trustee shall not be deemed to have knowledge of a Registration
Default unless a Responsible Officer shall have received written notification of
such event.
SECTION 6.3 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Notes and may otherwise deal with the Issuer or any of its
Affiliates with the same rights it would have if it were not Trustee. Any Agent
may do the same with like rights. The Trustee, however, must comply with
Sections 6.10 and 6.11.
SECTION 6.4 TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity, priority or
adequacy of this Indenture or the Notes; it shall not be accountable for the
Issuer's or the Company's use of the proceeds from the Notes; and it shall not
be responsible for any statement in the Notes other than its certificate of
authentication.
SECTION 6.5 NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing as to
which the Trustee has received notice pursuant to the provisions of this
Indenture, the Trustee shall mail to each Holder a notice of the Default or
Event of Default within 90 days after it occurs unless such
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Default or Event of Default has been cured or waived. Except in the case of a
Default or Event of Default in payment of any amounts due with respect to any
Note, the Trustee may withhold the notice if and so long as it in good faith
determines that withholding the notice is in the best interests of Holders.
SECTION 6.6 REPORTS BY TRUSTEE TO HOLDERS.
(a) Within 60 days after each June 15 beginning with June 15, 2005,
the Trustee shall mail to each Holder if required by TIA Section 313(a) a brief
report dated as of such June 15 that complies with TIA Section 313(c). In such
event, the Trustee also shall comply with TIA Section 313(b) and Section313(d).
(b) A copy of each report at the time of its mailing to Holders
shall be mailed to the Issuer and filed by the Trustee with the SEC and each
stock exchange, if any, on which the Notes are listed. The Issuer shall promptly
notify the Trustee when the Notes are listed on any stock exchange.
SECTION 6.7 COMPENSATION AND INDEMNITY.
(a) The Issuer and the Company shall pay to the Trustee from time to
time such compensation for its services as shall be agreed upon in writing. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Issuer shall reimburse the Trustee upon request
for all reasonable out-of-pocket expenses incurred by it. Such expenses shall
include the reasonable compensation and out-of-pocket expenses of the Trustee's
agents and counsel.
(b) The Issuer and the Company shall, jointly and severally,
indemnify the Trustee against any and all loss, liability, damage, claim or
expense (including the reasonable fees and expenses of counsel and taxes other
than those based upon the income of the Trustee) incurred by it in connection
with the acceptance or administration of this trust and the performance of its
duties hereunder, including the reasonable costs and expenses of defending
itself against any claim (whether asserted by the Issuer, the Company, any
Holder or any other Person) or liability in connection with the exercise or
performance of any of its powers and duties hereunder. The Issuer and the
Company need not pay for any settlement made without its consent. The Trustee
shall notify the Issuer promptly of any claim for which it may seek
indemnification. The Issuer and the Company need not reimburse any expense or
indemnify against any loss or liability incurred by the Trustee through the
Trustee's negligence or willful misconduct.
(c) To secure the Issuer's and the Company's payment obligations in
this Section 6.7, the Trustee shall have a lien prior to the Notes on all money
or property held or collected by the Trustee, except that held in trust to pay
amounts due on particular Notes.
(d) The indemnity obligations of the Issuer and the Company with
respect to the Trustee provided for in this Section 6.7 shall survive any
resignation or removal of the Trustee.
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(e) When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 5.1(e) or (f) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 6.8 REPLACEMENT OF TRUSTEE.
(a) A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 6.8.
(b) The Trustee may resign by so notifying the Issuer in writing 30
Business Days prior to such resignation. The Holders of a majority in aggregate
principal amount of the Notes then outstanding may remove the Trustee by so
notifying the Trustee and the Issuer in writing and may appoint a successor
Trustee with the Issuer's consent. The Issuer may remove the Trustee if:
(i) the Trustee fails to comply with Section 6.10;
(ii) the Trustee is adjudged a bankrupt or an insolvent;
(iii) a receiver or other public officer takes charge of the Trustee
or its property; or
(iv) the Trustee becomes incapable of acting.
(c) If the Trustee resigns or is removed or if a vacancy exists in
the office of Trustee for any reason, the Issuer shall promptly appoint a
successor Trustee.
(d) If a successor Trustee does not take office within 30 days after
the retiring Trustee resigns or is removed, the retiring Trustee (at the
Issuer's and the Company's expense), the Issuer or the Holders of at least 10%
in aggregate principal amount of the outstanding Notes may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(e) If the Trustee fails to comply with Section 6.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
(f) A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuer. 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
Holders. 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
6.7.
SECTION 6.9 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or
transfers by sale or otherwise all or substantially all of its corporate trust
business to, another corporation, the
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successor corporation without any further act shall be the successor Trustee, if
such successor corporation is otherwise eligible hereunder.
SECTION 6.10 ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a
corporation organized and doing business under the laws of the United States of
America or of any state thereof that is authorized under such laws to exercise
corporate trustee power, that is subject to supervision or examination by
federal or state authorities and that has a combined capital and surplus (on a
consolidated basis) of at least $100 million as set forth in its most recent
published annual report of condition. The Trustee shall comply with TIA Section
310(b).
SECTION 6.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER AND THE 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.
ARTICLE VII.
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 7.1 ISSUER OR COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.
The Issuer and the Company shall not consolidate with, merge with or
into, or sell, convey, transfer, lease or otherwise dispose of all or
substantially all of their property and assets (in one transaction or a series
of related transactions) to any Person unless:
(1) either (A) the Issuer or the Company shall be the
resulting, surviving or transferee Person (the "Successor Company"), or
(B) the Successor Company (if other than the Issuer or the Company, as the
case may be) (i) shall be a corporation organized and existing under the
laws of the United States of America or any state thereof or the District
of Columbia or under the laws of Canada or any province thereof, and (ii)
shall (together with its ultimate parent company, if applicable) expressly
assume, by a supplemental indenture, executed and delivered to the
Trustee, in form satisfactory to the Trustee, all of the Issuer's and, if
the Successor Company that succeeds to the Issuer assumes only the
obligations under the Notes but not under the Guarantee, the Company's
obligations for the due and punctual payment of the principal of (and
premium and Additional Interest, if any) and interest on all Notes and the
performance and observance of every covenant of this Indenture on the part
of the Issuer and the Company to be performed or observed and shall have
provided for conversion rights in accordance with Section 14.11 hereof;
(2) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing; and
(3) the Issuer and the Company shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation,
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merger, conveyance, transfer or lease and, if a supplemental indenture is
required in connection with such transaction, such supplemental indenture
comply with this Article and that all conditions precedent provided for
herein relating to such transaction have been complied with.
SECTION 7.2 SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation of the Issuer or the Company with or merger
of the Issuer or the Company with or into any other corporation or any
conveyance, transfer or lease of all or substantially all of the properties and
assets of the Issuer or the Company to any Person in accordance with Section
7.1, the successor Person formed by such consolidation or into which the Issuer
or the Company is merged or to which such conveyance, transfer or lease is made
shall succeed to, and be substituted for, and may exercise every right and power
of, the Issuer or the Company under this Indenture with the same effect as if
such successor Person had been named as the Issuer or the Company, as the case
may be, herein, and in the event of any such conveyance or transfer, the Issuer
or the Company (which term shall for this purpose mean the Person named as the
"Issuer" or the "Company," as the case may be, in the first paragraph of this
Indenture or any successor Person which shall theretofore become such in the
manner described in Section 7.1), except in the case of a lease to another
Person, shall be discharged of all obligations and covenants under this
Indenture and the Notes.
ARTICLE VIII.
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 8.1 WITHOUT CONSENT OF HOLDERS OF NOTES.
Without the consent of any Holders of Notes, the Issuer and the
Company, when authorized by Board Resolutions of their respective Boards of
Directors, and the Trustee, at any time and from time to time, may amend this
Indenture and the Notes to:
(a) add to the covenants of the Issuer and the Company for the
benefit of the Holders of Notes;
(b) surrender any right or power herein conferred upon the Issuer or
the Company;
(c) make provision with respect to the conversion rights of Holders
of Notes pursuant to Section 14.11 hereof;
(d) provide for the assumption of the Issuer's and the Company's
obligations to the Holders of Notes in the case of a merger, consolidation,
conveyance, transfer or lease pursuant to Article VII hereof;
(e) reduce the Conversion Price; provided, that such reduction in
the Conversion Price shall not adversely affect the interest of the Holders;
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(f) comply with the requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA;
(g) make any changes or modifications to this Indenture necessary in
connection with the registration of any Notes and the Common Shares to be
delivered upon conversion of any Notes under the Securities Act as contemplated
in the Registration Rights Agreement, provided, that such action pursuant to
this clause (g) does not, in the good faith opinion of the Board of Directors of
the Issuer, adversely affect the interests of the Holders in any material
respect;
(h) cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein or which is
otherwise defective, or to make any other provisions with respect to matters or
questions arising under this Indenture which the Issuer, the Company and the
Trustee may deem necessary or desirable and which shall not be inconsistent with
the provisions of this Indenture, provided, that such action pursuant to this
clause (h) does not, in the good faith opinion of the Board of Directors of the
Issuer, adversely affect the interests of the Holders in any material respect;
(i) add or modify any other provisions with respect to matters or
questions arising under this Indenture which the Issuer, the Company and the
Trustee may deem necessary or desirable and which shall not be inconsistent with
the provisions of this Indenture, provided, that such action pursuant to this
clause (i) does not adversely affect the interests of the Holders; or
(j) comply with the procedures of the Depositary.
SECTION 8.2 WITH CONSENT OF HOLDERS OF NOTES.
Except as provided below in this Section 8.2, this Indenture or the
Notes may be amended, modified or supplemented, and noncompliance in any
particular instance with any provision of this Indenture or the Notes may be
waived, in each case (i) with the written consent of the Holders of at least a
majority in aggregate principal amount of the outstanding Notes or (ii) by the
adoption of a resolution, at a meeting of Holders of the outstanding Notes at
which a quorum (as prescribed in Section 9.4) is present, by the Holders of a
majority in aggregate principal amount of the outstanding Notes represented at
such meeting.
Without the written consent or the affirmative vote of each Holder
so affected, an amendment, modification or waiver under this Section 8.2 may
not:
(a) change the maturity of the principal of, or any installment of
interest (including Additional Interest, if any) on, any Note;
(b) reduce the principal amount of, or premium, if any, or interest
(including Additional Interest or any payment of liquidated damages, if any) on
any Note;
(c) change the currency of payment of principal of, premium, if any,
or interest (including Additional Interest, if any) on any Note;
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(d) impair the right of any Holder to institute suit for the
enforcement of any payment in or with respect to any Note;
(e) modify the obligations of the Issuer or the Company to maintain
an office or agency in The City of New York pursuant to Section 10.2 hereof;
(f) amend the Designated Event Repurchase Right after the occurrence
of a Change in Control or the right to convert any Note in a manner adverse to
the Holders; provided, however, that the execution of a supplemental indenture
solely to permit an Acquiror to assume the Issuer's or the Company's obligations
under the Notes shall not be deemed to be adverse to the Holders;
(g) modify the redemption payment provisions of this Indenture in a
manner adverse to the Holders;
(h) reduce the percentage of aggregate principal amount of Notes
outstanding necessary to waive a default or amend or modify this Indenture,
except to provide that certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each outstanding Note
affected thereby; or
(i) reduce the requirements of Section 9.4 hereof for quorum or
voting, or reduce the percentage of aggregate principal amount of the
outstanding Notes the consent of whose Holders is required for any such
supplemental indenture or the consent of whose Holders is required for any
waiver provided for in this Indenture.
It shall not be necessary for any Act of Holders of Notes under this
Section 8.2 to approve the particular form of any proposal supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
SECTION 8.3 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment to this Indenture or the Notes shall be set forth in
a supplemental indenture that complies with the TIA as then in effect.
SECTION 8.4 REVOCATION OF CONSENTS AND EFFECT OF CONSENTS OR VOTES.
Until an amendment, supplement or waiver becomes effective, a
written consent to it by a Holder is a continuing consent by the Holder and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as the consenting Holder's Note, even if notation of the consent is not
made on any Note; provided, however, that unless a record date shall have been
established, any such Holder or subsequent Holder may revoke the consent as to
its Note or portion of a Note if the Trustee receives written notice of
revocation before the date the amendment, supplement or waiver becomes
effective.
An amendment, supplement or waiver becomes effective on receipt by
the Trustee of written consents from or affirmative votes by, as the case may
be, the Holders of the requisite percentage of aggregate principal amount of the
outstanding Notes, and thereafter shall bind every Holder of Notes; provided,
however, if the amendment, supplement or waiver makes a
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change described in any of the clauses (a) through (i) of Section 8.2 hereof,
the amendment, supplement or waiver shall bind only each Holder of a Note which
has consented to it or voted for it, as the case may be, and every subsequent
Holder of a Note or portion of a Note that evidences the same indebtedness as
the Note of the consenting or affirmatively voting, as the case may be, Holder.
The Issuer may, but shall not be obligated to, fix a special record
date (a "Special Record Date") for the purpose of determining the Holders
entitled to consent to any amendment, supplement or waiver, which Special Record
Date shall be not more than 30 days prior to the first solicitation of such
consent. If a Special Record Date is fixed, then notwithstanding the proviso in
the first paragraph of this section 8.4, those Persons who were Holders at such
Special Record Date (or their duly designated proxies), and only those Persons,
shall be entitled to revoke any consent previously given, whether or not such
Persons continue to be Holders after such Special Record Date. No such consent
shall be valid or effective for more than 90 days after such Special Record Date
unless consents from Holders of the requisite percentage in principal amount of
outstanding Notes required hereunder for the effectiveness of such consents
shall have also been given and not revoked within such 90 day period.
SECTION 8.5 NOTATION ON OR EXCHANGE OF NOTES.
If an amendment, supplement or waiver changes the terms of a Note:
(a) the Trustee may require the Holder of a Note to deliver such
Notes to the Trustee, the Trustee may place an appropriate notation on the Note
about the changed terms and return it to the Holder and the Trustee may place an
appropriate notation on any Note thereafter authenticated; or
(b) if the Issuer or the Trustee so determines, the Issuer in
exchange for the Note shall issue and the Trustee shall authenticate a new Note
that reflects the changed terms.
Failure to make the appropriate notation or issue a new Note shall
not affect the validity and effect of such amendment, supplement or waiver.
SECTION 8.6 TRUSTEE TO SIGN AMENDMENT, ETC.
The Trustee shall sign any amendment authorized pursuant to this
Article VIII if the amendment does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If the amendment does adversely affect
the rights, duties, liabilities or immunities of the Trustee, the Trustee may
but need not sign it. In signing or refusing to sign such amendment, the Trustee
shall be entitled to receive and shall be fully protected in relying upon an
Officers' Certificate and an Opinion of Counsel as conclusive evidence that such
amendment is authorized or permitted by this Indenture.
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ARTICLE IX.
MEETING OF HOLDERS OF NOTES
SECTION 9.1 PURPOSES FOR WHICH MEETINGS MAY BE CALLED.
A meeting of Holders of Notes may be called at any time and from
time to time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Notes.
SECTION 9.2 CALL NOTICE AND PLACE OF MEETINGS.
(a) The Trustee may at any time call a meeting of Holders of Notes
for any purpose specified in Section 9.1 hereof, to be held at such time and at
such place in The City of New York as the Trustee may determine. Notice of every
meeting of Holders of Notes, setting forth the time and the place of such
meeting and in general terms the action proposed to be taken at such meeting,
shall be given, in the manner provided in Section 16.2 hereof, not less than 21
nor more than 180 days prior to the date fixed for the meeting.
(b) In case at any time the Issuer, pursuant to an Issuer Board
Resolution, or the Holders of at least 10% in principal amount of the
outstanding Notes shall have requested the Trustee to call a meeting of the
Holders of Notes for any purpose specified in Section 9.1 hereof, by written
request setting forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have made the first publication of the
notice of such meeting within 21 days after receipt of such request or shall not
thereafter proceed to cause the meeting to be held as provided herein, then the
Issuer or the Holders of Notes in the amount specified, as the case may be, may
determine the time and the place in The City of New York for such meeting and
may call such meeting for such purposes by giving notice thereof as provided in
paragraph (a) of this Section.
SECTION 9.3 PERSONS ENTITLED TO VOTE AT MEETINGS.
To be entitled to vote at any meeting of Holders of Notes, a Person
shall be (a) a Holder of one or more outstanding Notes, or (b) a Person
appointed by an instrument in writing as proxy for a Holder or Holders of one or
more outstanding Notes by such Holder or Holders. The only Persons who shall be
entitled to be present or to speak at any meeting of Holders shall be the
Persons entitled to vote at such meeting and their counsel, any representatives
of the Trustee and its counsel and any representatives of the Issuer and its
counsel.
SECTION 9.4 QUORUM; ACTION.
The Persons entitled to vote a majority in principal amount of the
outstanding Notes shall constitute a quorum. In the absence of a quorum within
30 minutes of the time appointed for any such meeting, the meeting shall, if
convened at the request of Holders of Notes, be dissolved. In any other case,
the meeting may be adjourned for a period of not less than 10 days as determined
by the chairman of the meeting prior to the adjournment of such meeting. In the
absence of a quorum at any such adjourned meeting, such adjourned meeting
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may be further adjourned for a period of not less than 10 days as determined by
the chairman of the meeting prior to the adjournment of such adjourned meeting.
Notice of the reconvening of any adjourned meeting shall be given as provided in
Section 9.2(a) hereof, except that such notice need be given only once and not
less than five days prior to the date on which the meeting is scheduled to be
reconvened.
At a meeting or an adjourned meeting duly reconvened and at which a
quorum is present as aforesaid, any resolution and all matters (except as
limited by the proviso to Section 8.2 hereof) shall be effectively passed and
decided if passed or decided by the Persons entitled to vote not less than a
majority in principal amount of outstanding Notes represented and voting at such
meeting.
Any resolution passed or decisions taken at any meeting of Holders
of Notes duly held in accordance with this Section 9.4 shall be binding on all
the Holders of Notes, whether or not present or represented at the meeting.
SECTION 9.5 DETERMINATION OF VOTING RIGHTS; CONDUCT AND ADJOURNMENT OF MEETINGS.
(a) Notwithstanding any other provisions of this Indenture, the
Trustee may make such reasonable regulations as it may deem advisable for any
meeting of Holders of Notes in regard to proof of the holding of Notes and of
the appointment of proxies and in regard to the appointment and duties of
inspectors of votes, the submission and examination of proxies, certificates and
other evidence of the right to vote, and such other matters concerning the
conduct of the meeting as it shall deem appropriate. Except as otherwise
permitted or required by any such regulations, the holding of Notes shall be
proved in the manner specified in Section 9.3 hereof and the appointment of any
proxy shall be proved in the manner specified in Section 9.3 hereof. Such
regulations may provide that written instruments appointing proxies, regular on
their face, may be presumed valid and genuine without the proof specified in
Section 9.3 hereof or other proof.
(b) The Trustee shall, by an instrument in writing, appoint a
temporary chairman (which may be the Trustee) of the meeting, unless the meeting
shall have been called by the Issuer or by Holders of Notes as provided in
Section 9.2(b) hereof, in which case the Issuer or the Holders of Notes calling
the meeting, as the case may be, shall in like manner appoint a temporary
chairman. A permanent chairman and a permanent secretary of the meeting shall be
elected by vote of the Persons entitled to vote a majority in principal amount
of the outstanding Notes represented at the meeting.
(c) At any meeting each Holder of a Note or proxy shall be entitled
to one vote for each $1,000 principal amount of Notes held or represented by
him; provided, however, that no vote shall be cast or counted at any meeting in
respect of any Note challenged as not outstanding and ruled by the chairman of
the meeting to be not outstanding. The chairman of the meeting shall have no
right to vote, except as a Holder of a Note or proxy.
(d) Any meeting of Holders of Notes duly called pursuant to Section
9.2 hereof at which a quorum (as prescribed in Section 9.4) is present may be
adjourned from time to
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time by Persons entitled to vote a majority in principal amount of the
outstanding Notes represented at the meeting, and the meeting may be held as so
adjourned without further notice.
SECTION 9.6 COUNTING VOTES AND RECORDING ACTION OF MEETINGS.
The vote upon any resolution submitted to any meeting of Holders of
Notes shall be by written ballots on which shall be subscribed the signatures of
the Holders of Notes or of their representatives by proxy and the principal
amounts and serial numbers of the outstanding Notes held or represented by them.
The permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record, at least in
duplicate, of the proceedings of each meeting of Holders of Notes shall be
prepared by the secretary of the meeting and there shall be attached to said
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more Persons having knowledge of the
facts setting forth a copy of the notice of the meeting and showing that said
notice was given as provided in Section 9.2 hereof and, if applicable, Section
9.4 hereof. Each copy shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one such copy shall be
delivered to the Company and another to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the matters
therein stated.
ARTICLE X.
COVENANTS
SECTION 10.1 PAYMENT OF NOTES.
(a) The Issuer shall pay all amounts due with respect to the Notes
on the dates and in the manner provided in this Indenture and the Notes. All
such amounts shall be considered paid on the date due if the Paying Agent holds
(or, if the Issuer is acting as Paying Agent, if the Issuer has segregated and
holds in trust in accordance with Section 2.4) on that date money sufficient to
pay the amount then due with respect to the Notes.
(b) The Issuer shall pay interest on any overdue amount (including,
to the extent permitted by applicable law, overdue interest) at the rate borne
by the Notes.
SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY.
(a) The Issuer will maintain in the Borough of Manhattan, the City
of New York, an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-Registrar) where Notes may be
surrendered for registration of transfer or exchange or conversion and where
notices and demands to or upon the Issuer in respect of the Notes and this
Indenture may be served. The Issuer will give prompt written notice to the
Trustee of the location, and any change in the location, of such office or
agency (other than a change in the location of the office of the Trustee). If at
any time the Issuer shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof,
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such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee.
(b) The Issuer may also from time to time designate one or more
other offices or agencies where the Notes 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 Issuer of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York for such purposes. The Issuer will
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.
(c) The Issuer hereby designates the office of the Trustee at 4 New
York Plaza, 1st Floor, New York, New York 10004, Attention: Institutional Trust
Services, as an agency of the Issuer in accordance with Section 2.3.
SECTION 10.3 REPORTS.
(a) The Issuer and the Company shall, upon request, provide to any
Holder or beneficial owner of Notes or prospective purchaser of Notes that so
requests the information required to be delivered pursuant to Rule 144A(d)(4)
until such time as the Notes and the underlying Common Shares have been
registered by the Issuer and the Company for resale under the Securities Act
pursuant to the Registration Rights Agreement. In addition, the Issuer or the
Company, as the case may be, will furnish such Rule 144A(d)(4) information if,
at any time while the Notes or the Common Shares issuable upon conversion of the
Notes are restricted securities within the meaning of the Securities Act, the
Issuer or the Company, as the case may be, is not subject to the informational
requirements of the Exchange Act.
(b) The Issuer will comply with the provisions of TIASection314(a).
(c) The Issuer and the Company (at its own expense) will deliver to
the Trustee within 15 days after the filing of the same with the SEC, copies of
the quarterly and annual reports and of the information, documents and other
financial reports, if any, which the Issuer or the Company may be required to
file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act or which
the Issuer or the Company furnishes to its shareholders or stockholders. In the
event the Issuer or the Company, as the case may be, is at any time no longer
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Issuer or the Company, as the case may be, shall continue to provide
the Trustee with such quarterly and annual reports and other financial reports,
if any, which the Issuer or the Company, as the case may be, furnishes to its
shareholders or stockholders. 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 Issuer's and the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on the Officers'
Certificate of the Issuer and the Company).
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SECTION 10.4 COMPLIANCE CERTIFICATE.
The Issuer and the Company shall deliver to the Trustee within
120 days after the end of each fiscal year (beginning with the fiscal year
ending on March 31, 2005) of the Issuer an Officers' Certificate of the Issuer
and the Company stating whether or not the signers know of any Default or Event
of Default by the Issuer or the Company in performing any of its obligations
under this Indenture or the Notes. If they do know of any such Default or Event
of Default, the Officers' Certificate shall describe the Default or Event of
Default and its status.
SECTION 10.5 STAY, EXTENSION AND USURY LAWS.
The Issuer covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay, extension or usury law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the Issuer (in each case, to
the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not, by resort to any such
law, 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 has been enacted.
SECTION 10.6 CORPORATE EXISTENCE.
Subject to Article VII, the Issuer and the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect their respective corporate existence and the corporate existence of each
of their respective subsidiaries in accordance with the respective
organizational documents of each subsidiary and the rights (charter and
statutory), licenses and franchises of the Issuer and the Company, as the case
may be, and their respective subsidiaries; provided, however, that the Issuer
and the Company shall not be required to preserve any such right, license or
franchise, or the corporate existence of any subsidiary, if in the judgment of
their respective Board of Directors (i) such preservation or existence is not
material to the conduct of business of the Issuer and the Company, respectively
and (ii) the loss of such right, license or franchise or the dissolution of such
subsidiary does not have a material adverse impact on the Holders.
SECTION 10.7 NOTICE OF DEFAULT.
In the event that any Default or Event of Default shall occur,
the Issuer will give prompt written notice of such Default or Event of Default
to the Trustee.
ARTICLE XI.
MAKE WHOLE PREMIUM
SECTION 11.1 MAKE WHOLE PREMIUM.
(a) Upon the occurrence of a Change in Control, if the Issuer
indicates in the notice required to be sent to Holders pursuant to Section
11.2(c) hereof that it elects to pay the Make Whole Premium, the Issuer will
pay, on the Designated Event Repurchase Date, the Make Whole Premium, if any, to
holders of Notes that surrender their Notes for repurchase in
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connection with such Change in Control pursuant to Article XIII hereof or that
convert their Notes pursuant to Section 14.1 hereof.
(b) The Make Whole Premium shall be equal to a percentage of
the principal amount of the notes calculated in accordance with Section 11.1(c)
hereof. The Make Whole Premium will be in addition to, and not in substitution
for, any cash, securities, or other assets otherwise due to Holders of Notes
upon conversion or repurchase.
(c) The "Make Whole Premium" shall be equal to the principal
amount of the Notes to be redeemed multiplied by the applicable percentage set
forth on the table below (the "Make Whole Table") based on the Stock Price and
the Effective Date:
MAKE WHOLE PREMIUM UPON CHANGE IN CONTROL
(% OF PRINCIPAL AMOUNT)
STOCK PRICE
EFFECTIVE DATE $ 8.79 $ 9.00 $10.00 $11.00 $11.50 $12.00 $13.00 $14.00 $15.00 $17.50 $20.00 $25.00 $35.00 $50.00
- -------------- ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
10/04/04 ..... 5.1 6.5 13.4 20.3 23.9 23.2 21.9 20.6 19.5 17.2 15.2 12.2 8.3 4.8
10/15/05 ..... 4.8 6.1 12.8 19.6 23.0 22.1 20.7 19.4 18.2 15.7 13.6 10.7 6.9 3.8
10/15/06 ..... 4.2 5.4 11.7 18.2 21.5 20.6 19.0 17.5 16.1 13.5 11.4 8.5 5.2 2.7
10/15/07 ..... 3.2 4.3 10.0 16.1 19.3 18.3 16.4 14.7 13.3 10.5 8.4 5.8 3.3 1.6
10/15/08 ..... 1.0 1.9 6.9 12.4 15.3 14.0 11.8 10.0 8.5 5.8 4.2 2.5 1.4 0.7
10/15/09 ..... 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
(i) If the stock price of the Company is between two stock
price amounts on the Make Whole Table or the Effective Date is between
two dates on the Make Whole Table, the Make Whole Premium will be
determined by straight-line interpolation between Make Whole Premium
amounts set forth for the higher and lower stock price amounts and the
two dates, as applicable, based on a 365-day year.
(ii) If the stock price is in excess of $50.00 (subject to
adjustment as described in Section 11.3), the Make Whole Premium shall
be equal to $0 (the "Stock Price Cap").
(iii) If the stock price is less than $8.79 (subject to
adjustment as described in Section 11.3), the Make Whole Premium shall
be equal to $0 (the "Stock Price Threshold").
(iv) For purposes of this Section 11.1(c), the following terms
shall have the respective meanings indicated:
(1) "Effective Date" means the date that a Change in
Control becomes effective.
(2) "Stock Price" means the price paid per share of
Common Share in the transaction constituting the Change in Control,
determined as follows:
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(A) if holders of Common Shares receive only cash in
the transaction constituting the Change in Control, the Stock Price
shall equal the cash amount paid per share of Common Share; and
(B) in all other cases, the Stock Price shall equal
the average Closing Price of a Common Share over the ten Trading Day
period ending on the Trading Day immediately preceding the Effective
Date.
(d) The Issuer shall pay the Make Whole Premium in either
cash, Common Shares or a combination thereof. Any amount in respect thereof paid
in Common Shares shall be valued at the Stock Price, calculated in accordance
with Section 11.1(c) hereof.
(e) On or prior to the Designated Event Repurchase Date, the
Issuer shall deposit with the Paying Agent a number or an amount of Common
Shares and cash sufficient to pay the Make Whole Premium with respect to all the
Notes to be repurchased on such date and all the Notes converted in connection
with such Change in Control; provided that if such payment is made on the
Designated Event Repurchase Date, it must be received by the Paying Agent by
11:00 a.m., New York City time, on such date.
SECTION 11.2 ISSUER'S OPTION TO PROVIDE FOR CONVERSION INTO SHARES OF ACQUIROR
IN LIEU OF MAKE WHOLE PREMIUM.
(a) If a Change in Control occurs that would otherwise trigger
the obligation of the Issuer to pay the Make Whole Premium pursuant to Section
11.1 hereof and the Acquiror is a Public Entity or is a direct or indirect
subsidiary of a Public Entity, the Issuer may elect, in lieu of paying the Make
Whole Premium, to provide for the Notes to be convertible into Common Shares of
such Public Entity in lieu of paying the Make Whole Premium. The Issuer may
elect to provide for the conversion of the Notes into Common Shares of such
Public Entity (and thus to be under no obligation to pay the Make Whole Premium)
so long as:
(i) the common shares of the Public Entity into which the
Notes will be convertible are, subject to notification of issuance,
listed on the principal United States securities exchange on which the
issued and outstanding common shares of the Public Entity are listed
or, if not so listed, on NASDAQ or any similar U.S. system of automated
dissemination of quotations of securities prices;
(ii) the common shares of the Public Entity are registered
under the Exchange Act; and
(iii) the common shares of the Public Entity into which the
Notes will be convertible are registered under the Securities Act and
any necessary qualification or registration under applicable state
securities laws have been made (subject to the availability of any
exemption from such qualification and registration requirements).
(b) If the conditions contained in clauses (i) through (iii)
of Section 11.2(a) are not satisfied prior to the effectiveness of the Change in
Control, the Issuer shall pay the Make Whole Premium in connection with the
Change in Control to electing Holders as described under Article XIII and
Section 14.1 hereof.
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(c) The Issuer shall mail to all Record Holders and to the
Trustee a notice indicating Issuer's intent to either pay the Make Whole Premium
or to provide for the Notes to be convertible into Common Shares of the Public
Entity within 10 days after the Issuer has become aware of a Change in Control.
Such notice shall be in the same form as required under Section 13.4 hereof and
shall include the amount and basis of calculation of the Make Whole Premium.
SECTION 11.3 ADJUSTMENTS RELATING TO MAKE WHOLE PREMIUM.
Each time that the Conversion Rate is adjusted by the Issuer
pursuant to Section 14.4 hereof, the Stock Price Threshold and the Stock Price
Cap shall be adjusted and each of the Stock Prices set forth in the Make Whole
Table shall be adjusted by multiplying each such amount by a fraction, the
numerator of which is the Conversion Rate immediately prior to such adjustment
and the denominator of which is the Conversation Rate as so adjusted.
ARTICLE XII.
REDEMPTION OF NOTES
SECTION 12.1 [RESERVED]
SECTION 12.2 OPTIONAL REDEMPTION.
(a) The Issuer shall not redeem the Notes at any time prior to
October 15, 2009.
(b) On or after October 15, 2009, the Issuer may, at its
option, redeem the Notes in whole at any time or in part from time to time (an
"Optional Redemption") at the following redemption prices (expressed as a
percentage of the principal amount of such Notes) (the "Optional Redemption
Price") payable in cash:
DATE REDEMPTION PRICE
- ---- ----------------
October 15, 2009 to October 14, 2010 100.839%
October 15, 2010 to October 14, 2011 100.420%
October 15, 2011 and thereafter 100.000%
provided, however, that the Issuer may not redeem the Notes if the Issuer has
failed to pay any interest on the Notes and such failure to pay is continuing,
or if the principal amount of the Notes has been accelerated.
(c) The Issuer shall pay any interest on the Notes called for
redemption pursuant to this Section 12.2 (including those Notes which are
converted into Common Shares after the date the notice of the redemption is
mailed and prior to the Optional Redemption Date) accrued but not paid to, but
excluding, the Optional Redemption Date. Such interest shall be paid to the
Holder entitled to the Optional Redemption Price; provided that if the Optional
Redemption Date is an Interest Payment Date, the Issuer shall pay the interest
to the Holder of the Note at the close of business on the corresponding Regular
Record Date.
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SECTION 12.3 NOTICE TO TRUSTEE.
If the Issuer elects to redeem Notes pursuant to an Optional
Redemption (such election to be evidenced by a resolution of the Issuer's board
of directors), it shall notify the Trustee at least 25 but no more than 60 days
prior to the Optional Redemption Date (unless a shorter notice shall be
satisfactory to the Trustee) of such intended Optional Redemption Date, the
principal amount of Notes to be redeemed and the CUSIP numbers of the Notes to
be redeemed.
SECTION 12.4 SELECTION OF NOTES TO BE REDEEMED.
If fewer than all the Notes are to be redeemed pursuant to an
Optional Redemption, the Trustee shall select the particular Notes to be
redeemed in principal amounts of $1,000 or integral multiples thereof from
outstanding Notes by a method that complies with the requirements of any
exchange on which the Notes are listed, or, if the Notes are not listed on an
exchange, on a pro rata basis or otherwise in accordance with the applicable
procedures of the Depositary or by lot in accordance with any other method the
Trustee considers fair and appropriate. Notes and portions thereof that the
Trustee selects shall be in amounts equal to the minimum authorized
denominations for Notes to be redeemed or any integral multiple thereof.
If any Note selected for partial redemption pursuant to an
Optional Redemption is converted in part before termination of the conversion
right with respect to the portion of the Notes so selected, the converted
portion of such Note shall be deemed to be the portion selected for redemption
(provided, however, that the Holder of such Note so converted and deemed
redeemed shall not be entitled to any additional interest payment as a result of
such deemed redemption over the amount that such Holder would have otherwise
been entitled to receive upon conversion of such Note. Notes which have been
converted during a selection of Notes to be redeemed pursuant to an Optional
Redemption may be treated by the Trustee as outstanding for the purpose of such
selection.
The Trustee shall promptly notify the Issuer and the Registrar
in writing of the Notes selected for redemption and, in the case of any Notes
selected for partial redemption pursuant to an Optional Redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Notes shall
relate, in the case of any Notes redeemed or to be redeemed only in part, to the
portion of the principal amount of such Notes which has been or is to be
redeemed.
SECTION 12.5 NOTICE OF REDEMPTION.
(a) [Reserved.]
(b) Notice of an Optional Redemption shall be given in the
manner provided in Section 16.2 hereof to the Holders of Notes to be redeemed.
Such notice shall be given not less than 20 nor more than 60 days prior to the
Optional Redemption Date. All notices of an Optional Redemption shall state:
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(1) the Optional Redemption Date;
(2) the Optional Redemption Price and interest
accrued and unpaid to the Optional Redemption Date, if any;
(3) if fewer than all the outstanding Notes are to be
redeemed, the aggregate principal amount of Notes to be redeemed and
the aggregate principal amount of Notes which will be outstanding after
such partial redemption;
(4) that on the Optional Redemption Date the Optional
Redemption Price and, as provided in Section 12.2(c), interest accrued
and unpaid to, but excluding, the Optional Redemption Date, and
Additional Interest, if any, will become due and payable upon each such
Note to be redeemed, and that interest thereon shall cease to accrue on
and after such date;
(5) the Conversion Price then in effect, the date on
which the right to convert the principal of the Notes to be redeemed
will terminate and the places where such Notes may be surrendered for
conversion;
(6) the place or places where such Notes are to be
surrendered for payment of the Optional Redemption Price and accrued
and unpaid interest, if any;
(7) the CUSIP number of the Notes; and
(8) the last date on which exchanges or transfers of
Notes may be made pursuant to Section 2.6 hereof, and shall specify the
serial numbers and the portions thereof called for redemption.
(c) Notice of redemption of Notes to be redeemed at the
election of the Issuer shall be given by the Issuer or, at the Issuer's request,
by the Trustee in the name of and at the expense of the Issuer.
SECTION 12.6 EFFECT OF NOTICES OF REDEMPTION.
(a) Notice of redemption having been given as provided in
Section 12.5 hereof, the Notes so to be redeemed shall, on the Optional
Redemption Date, become due and payable at the Optional Redemption Price therein
specified (and, as provided in Section 12.2(c), accrued interest and Additional
Interest, if any, to but excluding, the Optional Redemption Date) and from and
after such date (unless the Issuer shall default in the payment of the Optional
Redemption Price and accrued and unpaid interest) such Notes shall cease to bear
interest and Additional Interest, if any; provided that the Issuer may specify
in such notice conditions to the redemption of the Notes that must be met on or
prior to the Optional Redemption Date, including the receipt of proceeds from
concurrent equity or other financings, in which case the Optional Redemption
Date shall not occur, and the Notes to be redeemed shall not be due and payable
at the Optional Redemption Price, until such conditions are satisfied. The
Issuer shall give, or instruct the Trustee to give, notice to the Holders of any
failure to satisfy such conditions prior to the Optional Redemption Date. Upon
surrender of any such Note for redemption in accordance with such notice
(including the satisfaction of all applicable conditions), such Note shall be
paid
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by the Issuer at the Optional Redemption Price (and, as provided in Section
12.2(c), Additional Interest and accrued interest, if any, to but excluding the
Optional Redemption Date); provided, however, that the installments of interest
on Notes with an Interest Payment Date prior to or on the Optional Redemption
Date shall be payable to the Holders of such Notes, or one or more Predecessor
Notes, registered as such on the relevant Record Date according to their terms
and the provisions of Section 2.6 hereof.
(b) If any Note called for redemption shall not be so paid
when due upon surrender thereof for redemption, the principal and premium, if
any, shall, until paid, bear interest from the Optional Redemption Date, as the
case may be, at the interest rate set forth on the Note.
SECTION 12.7 DEPOSIT OF OPTIONAL REDEMPTION PRICE.
Prior to any Optional Redemption Date or before 11:00 a.m. New
York time on any Optional Redemption Date, the Issuer shall deposit with the
Trustee or with a Paying Agent (or, if the Issuer is acting as its own Paying
Agent, segregate and hold in trust) an amount of money sufficient to pay the
Optional Redemption Price of, and accrued and unpaid interest and Additional
Interest, if any, on all the Notes to be redeemed on that Optional Redemption
Date other than any Notes called for redemption on that date which have been
converted prior to the date of such deposit.
If any Note called for redemption is converted prior to the
Optional Redemption Date, any money deposited with the Trustee or with a Paying
Agent or so segregated and held in trust for the redemption of such Note shall
(subject to any right of the Holder of such Note or any Predecessor Note to
receive interest as provided in the third paragraph of Section 2.1(c) hereof) be
paid to the Issuer on Issuer Request or, if then held by the Issuer, shall be
discharged from such trust.
SECTION 12.8 NOTES REDEEMED IN PART.
Any Note which is to be redeemed only in part shall be
surrendered at an office or agency of the Issuer designated for that purpose
pursuant to Section 10.2 hereof (with, if the Issuer or the Trustee so requires,
due endorsement by, or a written instrument of transfer in form satisfactory to
the Issuer and the Trustee duly executed by, the Holder thereof or the Holder's
attorney duly authorized in writing), and the Issuer shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Note without
service charge, a new Note or Notes of any authorized denomination as requested
by such Holder in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Note so surrendered.
SECTION 12.9 CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION.
In connection with any redemption of Notes, the Issuer may
arrange for the purchase and conversion of any such Notes called for redemption
by entering into an agreement with one or more investment banks or other
purchasers (the "Purchasers") to purchase all or a portion of such Notes by
paying to the Trustee in trust for the Holders, on or before the Redemption
Date, an amount not less than the applicable Redemption Price (together with
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accrued interest to the Redemption Date, including Additional Interest, if any)
of such Notes. Notwithstanding anything to the contrary contained in this
Article XII, the obligation of the Issuer to pay the Redemption Price (together
with accrued interest to the Redemption Date, including Additional Interest, if
any) shall be deemed to be satisfied and discharged to the extent such amount is
so paid by such Purchasers. If such an agreement is entered into (a copy of
which shall be filed with the Trustee prior to the close of business on the
Business Day immediately prior to the Redemption Date), any Notes called for
redemption that are not duly surrendered for conversion by the Holders thereof
may, at the option of the Issuer, be deemed, to the fullest extent permitted by
law, and consistent with any such agreement or agreements with such Purchasers,
to be acquired by such Purchasers from such Holders and (notwithstanding
anything to the contrary contained in this Article XII) surrendered by such
Purchasers for conversion, all as of immediately prior to the close of business
on the Redemption Date (and the right to convert any such Notes shall be
extended through such time), subject to payment of the above amount as
aforesaid. At the direction of the Issuer, the Trustee shall hold and dispose of
any such amount paid to it by the Purchasers to the Holders in the same manner
as it would monies deposited with it by the Issuer for the redemption of Notes.
Without the Trustee's prior written consent, no arrangement between the Issuer
and such Purchasers for the purchase and conversion of any Notes shall increase
or otherwise affect any of the powers, duties, responsibilities or obligations
of the Trustee as set forth in this Indenture, and the Issuer agrees to
indemnify the Trustee from, and hold it harmless against, any loss, liability or
expense arising out of or in connection with any such arrangement for the
purchase and conversion of any Notes between the Issuer and such Purchasers,
including the reasonable costs and expenses, including reasonable legal fees,
incurred by the Trustee in the defense of such claim or liability.
ARTICLE XIII.
REPURCHASE OF NOTES
SECTION 13.1 REPURCHASE AT THE OPTION OF THE HOLDER ON SPECIFIED DATES.
(a) On each of October 15, 2011, 2014 and 2019 (each, a
"Special Repurchase Date"), the Holder shall have the right (the "Special
Repurchase Right") at the Holder's option to require the Issuer to repurchase
for cash any outstanding Note for which a written Repurchase Notice has been
delivered to the Issuer by the Holder in accordance with this Section 13.1 and
not withdrawn. Holders may submit their Notes for repurchase to the Paying Agent
at any time from the opening of business on the date that is 20 Business Days
prior to the Special Repurchase Date until the close of business on such Special
Repurchase Date. The "Special Repurchase Price" of the Note shall be equal to
100% of the principal amount of the Note, plus accrued and unpaid interest and
Additional Interest, if any to, but excluding the Special Repurchase Date.
Interest and Additional Interest, if any, will be paid to the Record Holder as
of the related Record Date.
(b) The Repurchase Notice given by each Holder electing to
require the Issuer to repurchase notes shall state:
(1) if certificated Notes have been issued, the
certificate number of the Notes that the Holder will deliver to be
repurchased, or if no certificated Notes have been
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issued, such information as may be required under the applicable
procedures of the Depositary and this Indenture;
(2) the portion of the principal amount of the Notes
that the Holder will deliver to be repurchased, which portion must be
$1,000 or an integral multiple thereof (or the entire principal amount
of the Notes held by such Holder); and
(3) that such Notes shall be repurchased by the
Issuer as of the Special Repurchase Date pursuant to the terms and
conditions specified in the Notes and this Indenture.
(c) Delivery of such Notes to the Paying Agent prior to, on or
after the Special Repurchase Date (together with all necessary endorsements) (at
the offices of the Paying Agent in the case of certificated Notes or otherwise
by book-entry transfer) is a condition to receipt by the Holder of the
Repurchase Price therefor; provided, however, that such Repurchase Price shall
be so paid pursuant to this Section 13.1 only if the Notes so delivered to the
Paying Agent conform in all respects to the description thereof in the related
Repurchase Notice.
(d) The Paying Agent shall promptly notify the Issuer of the
receipt by it of a Repurchase Notice.
(e) Any repurchase by the Issuer contemplated pursuant to the
provisions of this Section 13.1 shall be consummated by the delivery of the
consideration from the Issuer to the Paying Agent, to be received by the Holder
promptly following the later of the Repurchase Date and the date of delivery of
the Note.
(f) If the Paying Agent holds money or notes sufficient to pay
the Repurchase Price of the Notes on the Repurchase Date in accordance with the
terms of this Indenture, then, on and immediately after the Business Day
following the Repurchase Date, the Notes will cease to be Outstanding whether or
not book-entry transfer of the Notes has been made or the Notes have been
delivered to the Paying Agent and interest will cease to accrue in respect of
any date from and after the Repurchase Date. Thereafter, all other rights of the
Holders shall terminate, other than the right to receive the Repurchase Price
upon delivery of the Notes.
SECTION 13.2 REPURCHASE AT THE OPTION OF THE HOLDER UPON A DESIGNATED EVENT.
(a) In the event that a Designated Event shall occur at any
time prior to the maturity of the Notes, then each Holder shall have the right,
at such Holder's option, to require the Issuer to repurchase, and upon the
exercise of such right the Issuer shall repurchase, such Holder's Notes, in
whole or in part, of U.S. $1,000 or any integral multiple of U.S. $1,000 in
excess thereof or the entire principal amount of the Notes held by any Holder
(provided that no single Note may be repurchased in part unless the portion of
the principal amount of such Note to be Outstanding after such repurchase is
equal to U.S. $1,000 or integral multiples of U.S. $1,000 in excess thereof), on
the date specified by the Issuer (the "Designated Event Repurchase Date") that
is not less than 20 nor more than 30 Business Days after the date of the Issuer
Notice (as defined in Section 13.4) at a purchase price equal to 100% of the
principal amount of the Notes to be repurchased plus accrued and unpaid interest
and Additional Interest, if any, to, but
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excluding, the Repurchase Date (the "Designated Event Repurchase Price");
provided, however, that installments of interest, if any, on Notes with an
Interest Payment Date on or prior to the Repurchase Date shall be payable to the
Holders of such Notes registered as such on the relevant Record Date according
to their terms and the provisions of Section 2.1 hereof. The Repurchase Price to
be paid upon a Designated Event shall be paid in cash. If the Designated Event
is a Change in Control, the Issuer shall pay to such Holder a Make Whole Premium
determined in accordance with Article XI hereof.
(b) To exercise a repurchase right, a Holder shall deliver to
the Issuer or its designated agent, prior to the close of business on the
Repurchase Date specified in the Issuer Notice (i) written notice of the
Holder's exercise of such right, which notice shall set forth the name of the
Holder, the principal amount of the Notes to be repurchased (and, if any Note is
to repurchased in part, the serial number thereof, the portion of the principal
amount thereof to be repurchased and the name of the Person in which the portion
thereof to remain Outstanding after such repurchase is to be registered) and a
statement that an election to exercise the repurchase right is being made
thereby (the "Repurchase Notice"), and (ii) the Notes with respect to which the
repurchase right is being exercised duly endorsed for transfer (or, if any Note
is not certificated, the Repurchase Notice must comply with Depositary
procedures). The Issuer will promptly pay following the Repurchase Date the
Repurchase Price for Notes surrendered for repurchase.
SECTION 13.3 [RESERVED]
SECTION 13.4 NOTICE OF OPTIONAL REPURCHASE TO BE PROVIDED BY THE ISSUER.
(a) Unless the Issuer shall have theretofore called for
redemption of all of the outstanding Notes, on or before the 10th day after the
occurrence of a Designated Event, the Issuer shall give to all Holders of Notes
and to the Trustee, in the manner provided in Section 16.2, notice (the "Issuer
Notice") of the occurrence of the Designated Event and of the repurchase right
set forth herein arising as a result thereof.
(b) Each Issuer Notice shall state:
(i) the Repurchase Date,
(ii) the date by which the repurchase right must be exercised,
(iii) whether the Designated Event is a Termination of Trading
or a Change in Control,
(iv) the Repurchase Price,
(v) if the Designated Event is a Change in Control, whether
the Issuer elects to pay the Make Whole Premium, as provided in Section
11.2 hereof,
(vi) if the Designated Event is a Change in Control and the
Issuer elects to pay the Make Whole Premium, the proportion of the Make
Whole Premium to be paid in cash and Common Shares,
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(vii) a description of the procedure that a Holder must follow
to exercise a repurchase right, and the place or places where such
Notes are to be surrendered for payment of the Repurchase Price and
accrued interest and Additional Interest, if any,
(viii) that on the Repurchase Date the Repurchase Price will
become due and payable upon each such Note designated by the Holder to
be repurchased, and that interest thereon will cease to accrue on and
after such date,
(ix) the Conversion Rate then in effect, whether the
conversion rights are then exercisable, the date on which the right to
convert the principal amount of the Notes to be repurchased will
terminate and the place or places where such Notes may be surrendered
for conversion, and
(x) the place or places that the Note certificate with the
election of Holder to require repurchase as specified in form of Global
Note shall be delivered.
(c) No failure of the Issuer to give the foregoing notices or
defect therein shall limit any Holder's right to exercise a repurchase right or
affect the validity of the proceedings for the repurchase of Notes.
(d) If any of the foregoing provisions or other provisions of
this Article XIII are inconsistent with applicable law, such law shall govern.
SECTION 13.5 NOTICE OF WITHDRAWAL.
A Holder may withdraw any Repurchase Notice by delivering a
written notice of withdrawal to the Paying Agent prior to the close of business
on the Repurchase Date ("Withdrawal Notice"). The Withdrawal Notice must state:
(a) the principal amount of the withdrawn Notes;
(b) if certificated Notes have been issued, the certificate
number of the withdrawn Notes (or, if the Notes are not certificated, the
Withdrawal Notice must comply with appropriate Depositary procedures); and
(c) the principal amount, if any, which remains subject to the
Repurchase Notice.
SECTION 13.6 PAYMENT OF THE REPURCHASE PRICE.
(a) Payment of the Repurchase Price for a Note for which a
Repurchase Notice has been delivered and not withdrawn is conditioned upon
book-entry transfer or delivery of the Note, together with necessary
endorsements, to the Paying Agent at its corporate trust office in the Borough
of Manhattan, The City of New York, or any other office of the Paying Agent, at
any time after delivery of the Repurchase Notice. Payment of the Repurchase
Price for the Note will be made promptly following the later of the Repurchase
Date and the time of book-entry transfer or delivery of the Note.
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(b) If the Paying Agent holds money sufficient to pay the
Repurchase Price of the Notes on the Repurchase Date, then, on and after the
business day following the Repurchase Date:
(i) the Notes will cease to be outstanding;
(ii) interest will cease to accrue in respect of any date from
and after the Repurchase Date; and
(iii) all other rights of the Holder will terminate, other
than the right to receive the Repurchase Price upon delivery of the
Notes.
(c) This will be the case whether or not book-entry transfer
to the Notes has been made or the Notes have been delivered to the Paying Agent.
Installments of interest that mature on or prior to the Repurchase Date shall be
payable in cash to the Holders of such Notes registered as such at the close of
business on the relevant Regular Record Date.
ARTICLE XIV.
CONVERSION OF NOTES
SECTION 14.1 CONVERSION RIGHT AND CONVERSION PRICE.
(a) Subject to and upon compliance with the provisions of this
Article, at the option of the Holder thereof, any outstanding Note or any
portion of the principal amount thereof which is $1,000 or an integral multiple
of $1,000 may be converted into duly authorized, fully paid and nonassessable
Common Shares, at the Conversion Price, determined as hereinafter provided, in
effect at the time of conversion and subject to adjustment, as described below.
Such conversion right shall expire at the close of business on the Business Day
immediately preceding October 15, 2024 unless the Notes or a portion thereof are
called for redemption or are repurchased. The Notes shall be convertible only
upon the occurrence of one of the following events:
(i) if, at any time on or before October 15, 2019, the Closing
Price of the Common Shares for at least 20 Trading Days in the period
of the 30 consecutive Trading Days ending on the eleventh Trading Day
of any fiscal quarter exceeds 120% of the then current Conversion Price
of the Notes, the Holder thereof will be entitled to convert such Notes
until the eleventh Trading Day of the immediately following fiscal
quarter;
(ii) if, on any date after October 15, 2019, the Closing Price
of the Common Shares on any day exceeds 120% of the then current
Conversion Price of the Notes, the Holder thereof will be entitled to
convert such Notes at all times thereafter;
(iii) if the Issuer elects to call the Notes for redemption,
then the Holder thereof will be entitled to convert such Note (or the
portion of the Note called for redemption, if less than all) until the
close of business on the Trading Day prior to the Redemption Date;
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(iv) if the Company distributes to all holders of Common
Shares, rights, options or warrants entitling them to purchase Common
Shares at less than the average Closing Price of the Common Shares for
the ten Trading Days preceding the declaration date for such
distribution, then the Holder thereof will be entitled to convert such
Notes until the close of business on the Business Day preceding the
Ex-Dividend Date for such distribution;
(v) if the Company distributes to all holders of Common
Shares, cash or other assets, debt securities or rights to purchase its
securities, which distribution has a per share value as determined by
the Board of Directors exceeding 5% of the Closing Price of the Common
Shares on the Business Day preceding the declaration of such
distribution, then the Holder thereof will be entitled to convert such
Notes until the close of business on the last Trading Day preceding the
Ex-Dividend Date for such distribution;
(vi) if the Company becomes a party to a consolidation,
merger, binding share exchange or sale or conveyance of all or
substantially all of the Company's property and assets in each case
pursuant to which the Common Shares would be converted into cash,
securities, and/or other property; or
(vii) if a Designated Event occurs, then the Holder thereof
will be entitled to convert such Notes at any time during the period
beginning 15 calendar days prior to the date announced by the Issuer as
the anticipated effective date of the Designated Event and until and
including the date which is 15 calendar days after the date that is the
effective date of the Designated Event.
A Note for which a Holder has delivered a repurchase notice
pursuant to Article XIII hereof may be surrendered for conversion only if such
notice is withdrawn in accordance with Article XIII hereof.
In the case of a distribution contemplated in clauses (iv) and
(v) above of this Section 14.1(a), the Issuer will notify Holders at least 20
calendar days prior to the Ex-Dividend Date for such distribution (the
"Distribution Notice"). Once the Issuer has given the Distribution Notice,
Holders may surrender their Notes for conversion at any time until the earlier
of the close of business on the last Business Day preceding the Ex-Dividend Date
or the Issuer's announcement that such distribution will not take place, in
which event the conversion request will be deemed withdrawn automatically. If in
the future the Issuer adopts a rights plan, Holders will not have any conversion
right pursuant to clause (v) of this Section 14.1(a) or otherwise, solely as a
result of the issuance of rights pursuant to the rights plan. Notwithstanding
the foregoing, in the event of a distribution contemplated in clauses (iv) and
(v) of this Section 14.1(a), Holders may not convert the Notes if the Holders
may participate in such distribution without converting their Notes.
In the event of a consolidation, merger, binding share
exchange or sale or conveyance of all or substantially all of the Company's
assets as contemplated in clause (vi) above, the Company will notify Holders at
least 20 days prior to the anticipated closing date of such transaction (the
"Merger Notice"). Once the Company has given the Merger Notice, the
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Holders may, in the event of such consolidation, merger, binding share exchange
or sale or conveyance of all or substantially all of the Company's assets, as
contemplated in clause (vi) above, surrender Notes for conversion at any time
from and after the date which is 15 calendar days prior to the date announced by
the Company or the Issuer as the anticipated effective date of such transaction
until and including the date which is 15 calendar days after the actual
effective date of such transaction. If the Holders do not convert their Notes
during this period, such Holders will be entitled to receive upon subsequent
conversion, if any, the kind and amount of cash, securities and other property
which they would have received if such Holders had converted their Notes
immediately prior to the transaction.
With respect to clause (i) of this Section 14.1(a), the
Conversion Agent will determine, on behalf of the Company, on the first Business
Day succeeding the first day of the fiscal quarter on which the Notes would be
convertible, whether the Notes are convertible as set forth in such clause (i)
based upon the Closing Price of the Common Shares and the then current
Conversion Price and, if so, will notify the Issuer. With respect to clause (ii)
of this 14.1(a), the Conversion Agent will determine, on behalf of the Company,
daily on any date after October 15, 2019, whether the Notes are convertible as
set forth in such clause (ii) based upon the Closing Price of the Common Shares
and the then current Conversion Price and, if so, will notify the Issuer.
(b) Subject to the further provisions of this Article XIV, at
any time prior to October 15, 2019, a Holder of Notes may also convert the
principal amount of such Notes (or any portion thereof equal to $1,000 or any
integral multiple of $1,000 in excess thereof) for the five Business Day period
after any five consecutive Trading Day period in which the average of the
Trading Price for the Notes in such period was less than 98% of product of the
Closing Price of Common Shares and the Conversion Rate in effect on each such
five consecutive Trading Days.
The "Trading Price" of a Note on any date of determination
means the average of the secondary market bid quotations per $1,000 principal
amount of Notes obtained by the Conversion Agent for $2,000,000 principal amount
of the Notes at approximately 3:30 p.m., New York City time, on such
determination date from three independent nationally recognized securities
dealers the Issuer selects; provided that if three such bids cannot reasonably
be obtained by the Conversion Agent, but two such bids are obtained, then the
average of the two bids shall be used, and if only one such bid can reasonably
be obtained by the Conversion Agent, then one bid shall be used. If the
Conversion Agent cannot reasonably obtain at least one bid for $2,000,000
principal amount of the Notes from a nationally recognized securities dealer,
then the Trading Price per $1,000 principal amount of the Notes will be deemed
to be less than 98% of the product of the closing sale price of the Common
Shares and the Conversion Rate then in effect.
In connection with any conversion upon satisfaction of the
above Trading Price condition, the Conversion Agent shall have no obligation to
determine the Trading Price of the Notes unless the Issuer has requested such
determination; and the Issuer shall have no obligation to make such request
unless the Holder provides the Company with such a request in writing. If a
Holder submits a written request, the Issuer shall instruct the Conversion Agent
to determine the Trading Price of the Notes beginning on the next trading date
and on each successive trading
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day until the Trading Price is greater than or equal to 98% of the product of
the closing sale price of the Common Shares and the Conversion Rate then in
effect for five consecutive Trading Days.
(c) The rate at which Common Shares shall be delivered upon
conversion (the "Conversion Rate") shall be initially equal to 86.9565 Common
Shares per $1,000 principal amount of Notes. The Conversion Price of the Notes
(the "Conversion Price") shall equal $1,000 divided by the Conversion Rate
(rounded to the nearest cent). The Conversion Price shall be adjusted in certain
instances as provided in Section 14.4 hereof.
(d) In case a Note or portion thereof is called for repurchase
or redemption, such conversion right in respect of the Note or the portion so
called, shall expire at the close of business on the Business Day immediately
preceding a Repurchase Date or a Redemption Date, unless the Issuer defaults in
making the payment due upon redemption. In the case of a Change in Control for
which the Holder exercises its Designated Event Repurchase Right with respect to
a Note or portion thereof, such conversion right in respect of the Note or
portion thereof shall expire at the close of business on the Business Day
immediately preceding the Designated Event Repurchase Date.
(e) Notwithstanding anything contained in this Article XIV,
any conversion of the Notes held by a resident of Canada will be subject to the
availability of a prospectus exemption under applicable Canadian securities laws
until such time as a final receipt has been issued for a Canadian prospectus
qualifying the distribution of the underlying Common Shares.
SECTION 14.2 EXERCISE OF CONVERSION RIGHT.
In order to exercise the conversion right with respect to any
interest in a Global Note, the beneficial holder must complete, or cause to be
completed, the appropriate instruction form for conversion pursuant to the
Depositary's book-entry conversion program; deliver, or cause to be delivered,
by book-entry delivery an interest in such Global Note; furnish appropriate
endorsements and transfer documents if required by the Issuer or the Trustee or
conversion agent; and pay the funds, if any, required by this Section 14.2 and
any transfer taxes if required pursuant to Section 14.8.
In order to exercise the conversion right with respect to any
Note in certificated form, the Issuer must receive at the office or agency of
the Issuer maintained for that purpose in the City of New York or, at the option
of such Holder, the Corporate Trust Office, such Note with the original or
facsimile of the form entitled "Conversion Notice" on the reverse thereof, duly
completed and manually signed, together with such Notes duly endorsed for
transfer, accompanied by the funds, if any, required by this Section 14.2. Such
notice shall also state the name or names (with address or addresses) in which
the certificate or certificates for shares of Common Shares which shall be
issuable on such conversion shall be issued, and shall be accompanied by
transfer or similar taxes, if required pursuant to Section 14.8.
If the Issuer elects to settle in Common Shares only, as
promptly as practicable after satisfaction of the requirements for conversion
set forth above, subject to compliance with any restrictions on transfer if
shares issuable on conversion are to be issued in a name other than that of the
Holder (as if such transfer were a transfer of the Note or Notes (or portion
thereof) so
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converted), the Issuer shall issue and shall deliver to such Holder at the
office or agency maintained by the Issuer for such purpose pursuant to Section
10.2, (i) a certificate or certificates for the number of full shares of Common
Shares issuable upon the conversion of such Note or portion thereof as
determined by the Issuer in accordance with the provisions of Section 14.14 (or
in the case of Notes submitted for conversion in connection with a Designated
Event pursuant to Section 14.1(a)(vii) on or after the record date for receiving
distributions in connection with the Designated Event, or if earlier, the
Effective Date, the kind and amount of cash, securities and other assets or
property which the holder would have received if it had held the number of
shares of Common Shares issuable upon conversion of such Note or portion thereof
prior to such record date or the Effective Date; provided that if the
determination date is the record date, the holder shall receive the cash,
securities or other assets or property on the Effective Date), (ii) in the case
of Notes submitted for conversion in connection with a Designated Event pursuant
to Section 14.1(a)(vii), if the Make Whole Premium is greater than zero, cash in
respect of any accrued but unpaid interest to, but excluding, the Conversion
Date, payable on the date the shares of Common Shares or other consideration, as
the case may be, are delivered and (iii) cash or a check or cash in respect of
any fractional interest in respect of a share of Common Shares arising upon such
conversion, calculated by the Issuer as provided in Section 14.3. If the Issuer
elects to settle in cash or a combination of cash and Common Shares, the cash
and, if applicable, a certificate or certificates for the number of full shares
of Common Shares into which the Notes are converted (and cash in lieu of
fractional shares) will be delivered to such holder after satisfaction of the
requirements for conversion set forth above, in accordance with Section 14.14.
In case any Note of a denomination greater than $1,000 shall be surrendered for
partial conversion, and subject to Section 2.2, the Issuer shall execute and the
Trustee shall authenticate and deliver to the holder of the Note so surrendered,
without charge to the holder, a new Note or Notes in authorized denominations in
an aggregate principal amount equal to the unconverted portion of the
surrendered Note.
Each conversion shall be deemed to have been effected as to
any such Note (or portion thereof) on the date on which the requirements set
forth above in this Section 14.2 have been satisfied as to such Note (or portion
thereof) (the "Conversion Date"), and the Person in whose name any certificate
or certificates for shares of Common Shares shall be issuable upon such
conversion shall be deemed to have become on said date the holder of record of
the shares represented thereby; provided that any such surrender on any date
when the stock transfer books of the Issuer shall be closed shall constitute the
Person in whose name the certificates are to be issued as the record holder
thereof for all purposes on the next succeeding day on which such stock transfer
books are open, but such conversion shall be at the Conversion Rate in effect on
the Conversion Date.
To the extent provided in Section 2.1, Notes surrendered for
conversion during the period from the close of business on any Record Date to
the opening of business on the next succeeding Interest Payment Date (except in
the case of any Note whose maturity is prior to such Interest Payment Date)
shall be accompanied by payment in New York Clearing House funds or other funds
acceptable to the Issuer of an amount equal to the interest and Additional
Interest, if any, to be received on such Interest Payment Date on the principal
amount of Notes being surrendered for conversion, as well as any taxes or duties
payable pursuant to Section 14.8. To the extent provided in Section 2.1, Notes
which have been called for redemption by the Issuer in a notice of redemption
pursuant to Section 12.4, and are converted prior to redemption or
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repurchase, shall not require such concurrent payment to the Issuer upon
surrender for conversion, if such Holder's conversion right would terminate
because of the redemption or repurchase between the Record Date and the close of
business on the second Business Day following the next succeeding Interest
Payment Date and if converted during the time period set forth in this sentence,
the Holders of such converted Notes shall be entitled to receive (and retain)
any accrued interest on the principal of such surrendered Notes, and Additional
Interest, if any. If a Holder exercises its conversion right pursuant to Section
14.1(a)(vii) and the Make Whole Premium is greater than zero, such Holder shall
be entitled to accrued and unpaid interest on the converted Notes to, but
excluding, the Conversion Date, which interest shall be payable in cash. In
addition, notwithstanding the foregoing, in the case of Notes submitted for
conversion in connection with a Designated Event, such Notes shall continue to
represent the right to receive the Make Whole Premium, if any, payable pursuant
to Article XI until such Make Whole Premium is so paid.
Notes shall be deemed to have been converted immediately prior
to the close of business on the day of surrender of such Notes for conversion in
accordance with the foregoing provisions, and at such time the rights of the
Holders of such Notes as Holders shall cease, and the Person or Persons entitled
to receive the Common Shares issuable upon conversion shall be treated for all
purposes as the record holder or holders of such Common Shares at such time. As
promptly as practicable on or after the conversion date, the Issuer shall cause
to be issued and delivered to such Conversion Agent a certificate or
certificates for the number of full Common Shares issuable upon conversion,
together with payment in lieu of any fraction of a share as provided in Section
14.3 hereof.
Upon the conversion of an interest in a Global Note, the
Conversion Agent, or the Custodian at the direction of the Conversion Agent,
shall make a notation on such Global Note as to the reduction in the principal
amount represented thereby. The Issuer shall notify the Trustee in writing of
any conversions of Notes effected through any Conversion Agent.
Except with respect to a conversion of a Note in connection
with a Change in Control pursuant to which a Make Whole Premium will be payable,
upon the conversion of a Note, a Holder will not receive any cash payment of
accrued and unpaid interest or Additional Interest, if any. Accrued and unpaid
interest, and Additional Interest, if any, is deemed to be paid in full with the
Common Shares (together with the cash payment, if any in lieu of fractional
shares) rather than cancelled, extinguished or forfeited.
In the case of any Note which is converted in part only, upon
such conversion the Issuer shall execute and the Trustee shall authenticate and
deliver to the Holder thereof, at the expense of the Issuer, a new Note or Notes
of authorized denominations in aggregate principal amount equal to the
unconverted portion of the principal amount of such Notes.
If Common Shares to be issued upon conversion of a Restricted
Security, or Notes to be issued upon conversion of a Restricted Security in part
only, are to be registered in a name other than that of the Holder of such
Restricted Security, such Holder must deliver to the Conversion Agent a
Conversion Notice, dated the date of surrender of such Restricted Security and
signed by such Holder, as to compliance with the restrictions on transfer
applicable to such
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Restricted Security. Neither the Trustee nor any Conversion Agent, Registrar or
Transfer Agent shall be required to register in a name other than that of the
Holder of Common Shares or Notes issued upon conversion of any Restricted
Security not so accompanied by a properly completed certificate.
The Issuer hereby initially appoints the Company as Conversion
Agent; provided that within five (5) Business Days of the date hereof, the
Issuer shall appoint as Conversion Agent either (i) an entity that would be
qualified to serve as the Trustee under this Indenture in accordance with
Article VI hereof or an affiliate of such an entity or (ii) another entity not
an affiliate of the Issuer or the Company that is reasonably acceptable to the
Trustee.
SECTION 14.3 FRACTIONS OF SHARES.
No fractional Common Shares shall be issued upon conversion of
any Note or Notes. If more than one Note shall be surrendered for conversion at
one time by the same Holder, the number of full shares which shall be issued
upon conversion thereof shall be computed on the basis of the aggregate
principal amount of the Notes (or specified portions thereof) so surrendered.
Instead of any fractional Common Shares which would otherwise be issued upon
conversion of any Note or Notes (or specified portions thereof), the Issuer
shall pay a cash adjustment in respect of such fraction (calculated to the
nearest one-100th of a share) in an amount equal to the same fraction of the
Closing Price of the Common Shares as of the Trading Day preceding the date of
conversion.
SECTION 14.4 ADJUSTMENT OF CONVERSION RATE.
The Conversion Rate shall be subject to adjustments,
calculated by the Issuer, from time to time as follows (which such adjustments
shall be determined by calculating the applicable adjustment to the Conversion
Price set forth below and converting such adjusted Conversion Price into the
applicable Conversion Rate as set forth in Section 14.1):
(a) In case the Company shall hereafter pay a dividend or make
a distribution to all holders of the outstanding Common Shares in Common Shares,
the Conversion Price in effect at the opening of business on the date following
the date fixed for the determination of shareholders entitled to receive such
dividend or other distribution shall be reduced by multiplying such Conversion
Price by a fraction:
(i) the numerator of which shall be the number of Common
Shares outstanding at the close of business on the Record Date (as
defined in Section 14.4(g)) fixed for such determination, and
(ii) the denominator of which shall be the sum of such number
of shares and the total number of shares constituting such dividend or
other distribution.
Such reduction shall become effective immediately after the
opening of business on the day following the Record Date. If any dividend or
distribution of the type described in this Section 14.4(a) is declared but not
so paid or made, the Conversion Price shall again be adjusted to the Conversion
Price which would then be in effect if such dividend or distribution had not
been declared.
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(b) In case the outstanding Common Shares shall be subdivided
into a greater number of Common Shares, the Conversion Price in effect at the
opening of business on the day following the day upon which such subdivision
becomes effective shall be proportionately reduced, and conversely, in case
outstanding Common Shares shall be combined into a smaller number of Common
Shares, the Conversion Price in effect at the opening of business on the day
following the day upon which such combination becomes effective shall be
proportionately increased, such reduction or increase, as the case may be, to
become effective immediately after the opening of business on the day following
the day upon which such subdivision or combination becomes effective.
(c) In case the Company shall issue rights or warrants (other
than any rights or warrants referred to in Section 14.4(d)) to all holders of
its outstanding Common Shares entitling them to subscribe for or purchase of
Common Shares (or securities convertible into Common Shares) at a price per
share (or having a conversion price per share) less than the Current Market
Price (as defined in Section 14.4(g)) on the Record Date fixed for the
determination of stockholders entitled to receive such rights or warrants, the
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect at the opening of
business on the date after such Record Date by a fraction:
(i) the numerator of which shall be the number of Common
Shares outstanding at the close of business on the Record Date plus the
number of shares which the aggregate offering price of the total number
of shares so offered for subscription or purchase (or the aggregate
conversion price of the convertible securities so offered) would
purchase at such Current Market Price, and
(ii) the denominator of which shall be the number of Common
Shares outstanding on the close of business on the Record Date plus the
total number of additional Common Shares so offered for subscription or
purchase (or into which the convertible securities so offered are
convertible).
Such adjustment shall become effective immediately after the
opening of business on the day following the Record Date fixed for determination
of shareholders entitled to receive such rights or warrants. To the extent that
Common Shares (or securities convertible into Common Shares) are not delivered
pursuant to such rights or warrants, upon the expiration or termination of such
rights or warrants the Conversion Price shall be readjusted to the Conversion
Price which would then be in effect had the adjustments made upon the issuance
of such rights or warrants been made on the basis of the delivery of only the
number of Common Shares (or securities convertible into Common Shares) actually
delivered. In the event that such rights or warrants are not so issued, the
Conversion Price shall again be adjusted to be the Conversion Price which would
then be in effect if such date fixed for the determination of shareholders
entitled to receive such rights or warrants had not been fixed. In determining
whether any rights or warrants entitle the holders to subscribe for or purchase
Common Shares at less than such Current Market Price, and in determining the
aggregate offering price of such Common Shares, there shall be taken into
account any consideration received for such rights or warrants, the value of
such consideration if other than cash, to be determined by the Board of
Directors of the Issuer.
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(d) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Shares of any class of Capital Shares of
the Company (other than any dividends or distributions to which Section 14.4(a)
applies) or evidences of its indebtedness or other assets, including securities,
but excluding (1) any rights or warrants referred to in Section 14.4(c), (2) any
stock, securities or other property or assets (including cash) distributed as
dividends or distributions in connection with a reclassification, change,
merger, combination, sale, conveyance, consolidation or statutory share exchange
to which Section 14.11 hereof applies and (3) any dividends or distributions
paid exclusively in cash (the securities described in foregoing are hereinafter
in this Section 14.4(d) called the "securities"), then, in each such case,
subject to the second succeeding paragraph of this Section 14.4(d), the
Conversion Price shall be reduced so that the same shall be equal to the price
determined by multiplying the Conversion Price in effect immediately prior to
the close of business on the Record Date (as defined in Section 14.4(g)) with
respect to such distribution by a fraction:
(i) the numerator of which shall be the Current Market Price
(determined as provided in Section 14.4(g)) on such date less the fair
market value (as determined by the Board of Directors of the Issuer,
whose determination shall be conclusive and set forth in a Board
Resolution of the Issuer) on such date of the portion of the securities
so distributed applicable to one Common Share (determined on the basis
of the number of Common Shares outstanding on the Record Date), and
(ii) the denominator of which shall be such Current Market
Price.
Such reduction shall become effective immediately prior to the
opening of business on the day following the Record Date. However, in the event
that the then fair market value (as so determined) of the portion of the
securities so distributed applicable to one Common Share is equal to or greater
than the Current Market Price on the Record Date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each Holder shall have the
right to receive upon conversion of a Note (or any portion thereof) the amount
of securities such Holder would have received had such Holder converted such
Note (or portion thereof) immediately prior to such Record Date. In the event
that such dividend or distribution is not so paid or made, the Conversion Price
shall again be adjusted to be the Conversion Price which would then be in effect
if such dividend or distribution had not been declared.
If the Board of Directors of the Company determines the fair
market value of any distribution for purposes of this Section 14.4(d) by
reference to the actual or when issued trading market for any securities
comprising all or part of such distribution, it must in doing so consider the
prices in such market over the same period (the "Reference Period") used in
computing the Current Market Price pursuant to Section 14.4(g) to the extent
possible, unless the Board of Directors of the Company in a Board Resolution
determines in good faith that determining the fair market value during the
Reference Period would not be in the best interest of the Holder.
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Rights or warrants distributed by the Company to all holders
of Common Shares entitling the holders thereof to subscribe for or purchase the
Company's Capital Shares (either initially or under certain circumstances),
which rights or warrants, until the occurrence of a specified event or events (a
"Trigger Event"):
(1) are deemed to be transferred with such Common
Shares;
(2) are not exercisable; and
(3) are also issued in respect of future issuances of
Common Shares,
shall be deemed not to have been distributed for purposes of this Section
14.4(d) (and no adjustment to the Conversion Price under this Section 14.4(d)
will be required) until the occurrence of the earliest Trigger Event. If such
right or warrant is subject to subsequent events, upon the occurrence of which
such right or warrant shall become exercisable to purchase different securities,
evidences of indebtedness or other assets or entitle the holder to purchase a
different number or amount of the foregoing or to purchase any of the foregoing
at a different purchase price, then the occurrence of each such event shall be
deemed to be the date of issuance and record date with respect to a new right or
warrant (and a termination or expiration of the existing right or warrant
without exercise by the holder thereof). In addition, in the event of any
distribution (or deemed distribution) of rights or warrants, or any Trigger
Event or other event (of the type described in the preceding sentence) with
respect thereto, that resulted in an adjustment to the Conversion Price under
this Section 14.4(d):
(4) in the case of any such rights or warrants which
shall all have been redeemed or repurchased without exercise by any
holders thereof, the Conversion Price shall be readjusted upon such
final redemption or repurchase to give effect to such distribution or
Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price
received by a holder of Common Shares with respect to such rights or
warrant (assuming such holder had retained such rights or warrants),
made to all holders of Common Shares as of the date of such redemption
or repurchase, and
(5) in the case of such rights or warrants all of
which shall have expired or been terminated without exercise, the
Conversion Price shall be readjusted as if such rights and warrants had
never been issued.
For purposes of this Section 14.4(d) and Sections 14.4(a),
14.4(b) and 14.4(c), any dividend or distribution to which this Section 14.4(d)
is applicable that also includes Common Shares, a subdivision or combination of
Common Shares to which Section 14.4(c) applies, or rights or warrants to
subscribe for or purchase Common Shares to which Section 14.4(c) applies (or any
combination thereof), shall be deemed instead to be:
(6) a dividend or distribution of the evidences of
indebtedness, assets, shares of capital stock, rights or warrants other
than such Common Shares, such subdivision or combination or such rights
or warrants to which Sections 14.4(a), 14.4(b) and 14.4(c) apply,
respectively (and any Conversion Price reduction required by this
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Section 14.4(d) with respect to such dividend or distribution shall
then be made), immediately followed by
(7) a dividend or distribution of such Common Shares,
such subdivision or combination or such rights or warrants (and any
further Conversion Price reduction required by Sections 14.4(a),
14.4(b) and 14.4(c) with respect to such dividend or distribution shall
then be made), except:
(A) the Record Date of such dividend or distribution
shall be substituted as (x) "the date fixed for the determination of
shareholders entitled to receive such dividend or other distribution,"
"Record Date fixed for such determinations" and "Record Date" within
the meaning of Section 14.4(a), (y) "the day upon which such
subdivision becomes effective" and "the day upon which such combination
becomes effective" within the meaning of Section 14.4(b), and (z) as
"the date fixed for the determination of shareholders entitled to
receive such rights or warrants," "the Record Date fixed for the
determination of the shareholders entitled to receive such rights or
warrants" and such "Record Date" within the meaning of Section 14.4(c),
and
(B) any Common Shares included in such dividend or
distribution shall not be deemed "outstanding at the close of business
on the date fixed for such determination" within the meaning of Section
14.4(a) and any reduction or increase in the number of Common Shares
resulting from such subdivision or combination shall be disregarded in
connection with such dividend or distribution.
(e) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Shares cash (excluding any cash that is
distributed upon a reclassification, change, merger, combination, sale,
conveyance, consolidation or statutory share exchange to which Section 14.11
hereof applies or as part of a distribution referred to in Section 14.4(d)
hereof), then and in each such case, immediately after the close of business on
the Record Date of such distribution, the Conversion Price shall be reduced so
that the same shall equal the price determined by multiplying the Conversion
Price in effect immediately prior to the close of business on such Record Date
by a fraction:
(i) the numerator of which shall be equal to the Current
Market Price on the Record Date, and
(ii) the denominator of which shall be equal to the Current
Market Price on such Record Date less the full amount of such
distribution, in each case, applicable to one Common Share.
However, in the event that the then fair market value (as
determined by the Board of Directors of the Issuer, whose determination shall be
conclusive and set forth in a Board Resolution of the Issuer) of the portion of
the securities so distributed applicable to one Common Share is equal to or
greater than the Current Market Price on the Record Date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each Holder shall
have the right to receive upon conversion of a Note (or any portion thereof) the
amount of cash such Holder would have received had such Holder converted such
Note (or portion thereof) immediately prior
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to such Record Date. In the event that such dividend or distribution is not so
paid or made, the Conversion Price shall again be adjusted to be the Conversion
Price which would then be in effect if such dividend or distribution had not
been declared.
(f) In case a tender or exchange offer made by the Company or
any of its subsidiaries to all holders of Common Shares for all or any portion
of the Common Shares shall expire and such tender or exchange offer (as amended
upon the expiration thereof) shall require the payment to shareholders (based on
the acceptance (up to any maximum specified in the terms of the tender or
exchange offer) of Purchased Shares (as defined below)) of an aggregate
consideration having a fair market value (as determined by the Board of
Directors of the Issuer, whose determination shall be conclusive and set forth
in a Board Resolution of the Issuer), as of the expiration of such tender or
exchange offer that, combined together with the aggregate of the cash plus the
fair market value (as determined by the Board of Directors of the Issuer, whose
determination shall be conclusive and set forth in a Board Resolution of the
Issuer), as of the expiration of such tender or exchange offer, of consideration
payable in respect of any other tender or exchange offers, made by the Company
or any of its subsidiaries to all holders of Common Shares for all or any
portion of the Common Shares expiring within the 12 months preceding the
expiration of such tender or exchange offer and in respect of which no
adjustment pursuant to this Section 14.4(f) has been made, exceeds 5% of the
product of the Current Market Price (determined as provided in Section 14.4(g))
as of the last time (the "Expiration Time") tenders or exchanges could have been
made pursuant to such tender or exchange offer (as it may be amended) times the
number of Common Shares outstanding (including any tendered or exchanged shares)
on the Expiration Time, then, and in each such case, immediately prior to the
opening of business on the day after the date of the Expiration Time, the
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
close of business on the date of the Expiration Time by a fraction:
(i) the numerator of which shall be the number of Common
Shares outstanding (including any tendered or exchanged shares) at the
Expiration Time multiplied by the Current Market Price of the Common
Shares on the Trading Day next succeeding the Expiration Time, and
(ii) the denominator shall be the sum of (x) the fair market
value (determined as aforesaid) of the aggregate consideration payable
to stockholders based on the acceptance (up to any maximum specified in
the terms of the tender or exchange offer) of all shares validly
tendered or exchanged and not withdrawn as of the Expiration Time (the
shares deemed so accepted, up to any such maximum, being referred to as
the "Purchased Shares") and (y) the product of the number of Common
Shares outstanding (less any Purchased Shares) on the Expiration Time
and the Current Market Price of the Common Shares on the Trading Day
next succeeding the Expiration Time.
Such reduction (if any) shall become effective immediately
prior to the opening of business on the day following the Expiration Time. In
the event that the Company is obligated to purchase shares pursuant to any such
tender or exchange offer, but the Company is permanently prevented by applicable
law from effecting any such purchases or all such purchases are rescinded, the
Conversion Price shall again be adjusted to be the Conversion Price which would
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then be in effect if such tender or exchange offer had not been made. If the
application of this Section 14.4(f) to any tender or exchange offer would result
in an increase in the Conversion Price, no adjustment shall be made for such
tender or exchange offer under this Section 14.4(f).
(g) For purposes of this Section 14.4, the following terms
shall have the meanings indicated:
(1) "Current Market Price" shall mean the average of
the daily Closing Prices per Common Share for the ten consecutive
Trading Days immediately prior to the date in question; provided,
however, that if:
(i) the "ex" date (as hereinafter defined) for any
event (other than the issuance or distribution requiring such
computation) that requires an adjustment to the Conversion Price
pursuant to Section 14.4(a), (b), (c), (d), (e) or (f) occurs during
such ten consecutive Trading Days, the Closing Price for each Trading
Day prior to the "ex" date for such other event shall be adjusted by
multiplying such Closing Price by the same fraction by which the
Conversion Price is so required to be adjusted as a result of such
other event;
(ii) the "ex" date for any event (other than the
issuance or distribution requiring such computation) that requires an
adjustment to the Conversion Price pursuant to Section 14.4(a), (b),
(c), (d), (e) or (f) occurs on or after the "ex" date for the issuance
or distribution requiring such computation and prior to the day in
question, the Closing Price for each Trading Day on and after the "ex"
date for such other event shall be adjusted by multiplying such Closing
Price by the reciprocal of the fraction by which the Conversion Price
is so required to be adjusted as a result of such other event; and
(iii) the "ex" date for the issuance or distribution
requiring such computation is prior to the day in question, after
taking into account any adjustment required pursuant to clause (i) or
(ii) of this proviso, the Closing Price for each Trading Day on or
after such "ex" date shall be adjusted by adding thereto the amount of
any cash and the fair market value (as determined by the Board of
Directors of the Issuer in a manner consistent with any determination
of such value for purposes of Section 14.4(d) or (f), whose
determination shall be conclusive and set forth in a Board Resolution
of the Issuer) of the evidences of indebtedness, shares of capital
stock or assets being distributed applicable to one Common Share as of
the close of business on the day before such "ex" date.
For purposes of any computation under Section 14.4(f), the
Current Market Price of the Common Shares on any date shall be deemed to be the
average of the daily Closing Prices per Common Share for such day and the next
two succeeding Trading Days; provided, however, that if the "ex" date for any
event (other than the tender or exchange offer requiring such computation) that
requires an adjustment to the Conversion Price pursuant to Section 14.4(a), (b),
(c), (d), (e) or (f) occurs on or after the Expiration Time for the tender or
exchange offer requiring such computation and prior to the day in question, the
Closing Price for each Trading Day on and after the "ex" date for such other
event shall be adjusted by multiplying such Closing
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Price by the reciprocal of the fraction by which the Conversion Price is so
required to be adjusted as a result of such other event. For purposes of this
paragraph, the term "ex" date, when used:
(A) with respect to any issuance or distribution,
means the first date on which the Common Shares trade regular way on
the relevant exchange or in the relevant market from which the Closing
Price was obtained without the right to receive such issuance or
distribution;
(B) with respect to any subdivision or combination of
Common Shares, means the first date on which the Common Shares trade
regular way on such exchange or in such market after the time at which
such subdivision or combination becomes effective, and
(C) with respect to any tender or exchange offer,
means the first date on which the Common Shares trade regular way on
such exchange or in such market after the Expiration Time of such
offer.
Notwithstanding the foregoing, whenever successive adjustments
to the Conversion Price are called for pursuant to this Section 14.4, such
adjustments shall be made to the Current Market Price as may be necessary or
appropriate to effectuate the intent of this Section 14.4 and to avoid unjust or
inequitable results as determined in good faith by the Board of Directors of the
Issuer.
(2) "fair market value" shall mean the amount which a
willing buyer would pay a willing seller in an arm's length
transaction.
(3) "Record Date" shall mean, with respect to any
dividend, distribution or other transaction or event in which the
holders of Common Shares have the right to receive any cash, securities
or other property or in which the Common Shares (or other applicable
security) is exchanged for or converted into any combination of cash,
securities or other property, the date fixed for determination of
shareholders entitled to receive such cash, securities or other
property (whether such date is fixed by the Board of Directors of the
Company or by statute, contract or otherwise).
(h) The Issuer may make such reductions in the Conversion
Price, in addition to those required by Sections 14.4(a), (b), (c), (d), (e) or
(f), as the Board of Directors of the Issuer considers to be advisable to avoid
or diminish any income tax to holders of Common Shares or rights to purchase
Common Shares resulting from any dividend or distribution of stock (or rights to
acquire stock) or from any event treated as such for income tax purposes.
To the extent permitted by applicable law, the Issuer from
time to time may reduce the Conversion Price by any amount for any period of
time if the period is at least 20 days and the reduction is irrevocable during
the period and the Board of Directors of the Issuer determines in good faith
that such reduction would be in the best interests of the Issuer, which
determination shall be conclusive and set forth in a Board Resolution of the
Issuer. Whenever the Conversion Price is reduced pursuant to the preceding
sentence, the Issuer shall mail to the Trustee and each Holder at the address of
such Holder as it appears in the Register a notice of the
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reduction at least 15 days prior to the date the reduced Conversion Price takes
effect, and such notice shall state the reduced Conversion Price and the period
during which it will be in effect.
Notwithstanding the foregoing, any action taken under the two
immediately preceding paragraphs shall be subject to approval of the New York
Stock Exchange and the Toronto Stock Exchange (or other applicable regulatory
approval).
Adjustment to the Conversion Price is not necessary if Holders
may participate in the transactions otherwise giving rise to an adjustment on a
basis and with notice that the Board of Directors of the Issuer determines to be
fair and appropriate. Such participation is subject to acceptance by the New
York Stock Exchange and the Toronto Stock Exchange. In cases where the fair
market value of the portion of assets, debt securities or rights, warrants or
options to purchase securities of the Company applicable to one Common Share
distributed to shareholders exceeds the average sale price per Common Share, or
the average sale price per share of options on Common Shares so distributed by
less than $1.00, rather than being entitled to an adjustment in the Conversion
Price, a Holder, upon conversion of a Note, will be entitled to receive (in
addition to the Common Shares into which such Note is convertible) the kind and
amounts of assets, debt securities or rights, options or warrants comprising the
distribution that such Holder would have received if such Holder had converted
such Note immediately prior to the record date for determining the shareholders
entitled to receive such distribution.
(i) No adjustment in the Conversion Price shall be required
unless such adjustment would require an increase or decrease of at least 1% in
such price; provided, however, that any adjustments which by reason of this
Section 14.4(i) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Article
XIV shall be made by the Issuer and shall be made to the nearest cent or to the
nearest one-hundredth (1/100th) of a share, as the case may be. No adjustment
need be made for a change in the par value or no par value of the Common Shares.
(j) In any case in which this Section 14.4 provides that an
adjustment shall become effective immediately after a Record Date for an event,
the Issuer may defer until the occurrence of such event (i) issuing to the
Holder of any Note converted after such Record Date and before the occurrence of
such event the additional Common Shares issuable upon such conversion by reason
of the adjustment required by such event over and above the Common Shares
issuable upon such conversion before giving effect to such adjustment and (ii)
paying to such holder any amount in cash in lieu of any fraction pursuant to
Section 14.3 hereof.
(k) For purposes of this Section 14.4, the number of Common
Shares at any time outstanding shall not include shares held in the treasury of
the Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of Common Shares. The Company will not pay any
dividend or make any distribution on Common Shares held in the treasury of the
Company.
(l) If the distribution date for the rights provided in the
Company's rights agreement, if any, occurs prior to the date a Note is
converted, (i) the Holder of the Note who converts such Note after the
distribution date is entitled to receive the rights that would otherwise be
attached (but for the date of conversion) to the Common Shares received upon
such
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conversion and (ii) no adjustment shall be made to the Conversion Price pursuant
to clause 14.4(b).
SECTION 14.5 NOTICE OF ADJUSTMENTS OF CONVERSION PRICE.
Whenever the Conversion Price is adjusted as herein provided
(other than in the case of an adjustment pursuant to the second paragraph of
Section 14.4(h) for which the notice required by such paragraph has been
provided), the Issuer shall promptly file with the Trustee and any Conversion
Agent an Issuer Officers' Certificate setting forth the adjusted Conversion
Price and showing in reasonable detail the facts upon which such adjustment is
based; provided that the Trustee shall have no duty or obligation to verify the
accuracy of the adjusted Conversion Price. Promptly after delivery of such
Issuer Officers' Certificate, the Issuer shall prepare a notice stating that the
Conversion Price has been adjusted and setting forth the adjusted Conversion
Price and the date on which each adjustment becomes effective, and shall mail
such notice to each Holder at the address of such Holder as it appears in the
Register within 20 days of the effective date of such adjustment. Failure to
deliver such notice shall not effect the legality or validity of any such
adjustment.
SECTION 14.6 NOTICE PRIOR TO CERTAIN ACTIONS.
In case at any time after the date hereof:
(1) the Company shall declare a dividend (or any
other distribution) on its Common Shares payable otherwise than in cash
out of its capital surplus or its consolidated retained earnings;
(2) the Company shall authorize the granting to the
holders of its Common Shares of rights or warrants to subscribe for or
purchase any shares of capital stock of any class (or of securities
convertible into shares of capital stock of any class) or of any other
rights;
(3) there shall occur any reclassification of the
Common Shares of the Company (other than a subdivision or combination
of its outstanding Common Shares, a change in par value, a change from
par value to no par value or a change from no par value to par value),
or any merger, consolidation, statutory share exchange or combination
to which the Company is a party and for which approval of any
shareholders of the Company is required, or the sale, transfer or
conveyance of all or substantially all of the assets of the Company; or
(4) there shall occur the voluntary or involuntary
dissolution, liquidation or winding up of the Company; the Issuer shall
cause to be filed at each office or agency maintained for the purpose
of conversion of securities pursuant to Section 10.2 hereof, and shall
cause to be provided to the Trustee and all Holders in accordance with
Section 16.2 hereof, at least 20 days (or 10 days in any case specified
in clause (1) or (2) above) prior to the applicable record or effective
date hereinafter specified, a notice stating:
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(A) the date on which a record is to be taken for the
purpose of such dividend, distribution, rights or warrants, or, if a
record is not to be taken, the date as of which the holders of Common
Shares of record to be entitled to such dividend, distribution, rights
or warrants are to be determined, or
(B) the date on which such reclassification, merger,
consolidation, statutory share exchange, combination, sale, transfer,
conveyance, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that holders
of Common Shares of record shall be entitled to exchange their Common
Shares for securities, cash or other property deliverable upon such
reclassification, merger, consolidation, statutory share exchange,
sale, transfer, dissolution, liquidation or winding up.
Neither the failure to give such notice nor any defect therein
shall affect the legality or validity of the proceedings or actions described in
clauses (1) through (4) of this Section 14.6.
SECTION 14.7 COMPANY TO RESERVE COMMON SHARES; INTERCOMPANY AGREEMENT.
(a) The Company shall at all times use its best efforts to
reserve and keep available, free from preemptive rights, out of its authorized
but unissued Common Shares, for the purpose of effecting the conversion of
Notes, the full number of fully paid and nonassessable Common Shares then
issuable upon the conversion of all outstanding Notes.
(b) The Issuer and the Company will have agreed to contribute
the Common Shares issuable upon conversion of the Notes pursuant to this Article
XIV to the Issuer by the date hereof.
SECTION 14.8 TAXES ON CONVERSIONS.
Except as provided in the next sentence, the Issuer will pay
any and all taxes (other than taxes on income) and duties that may be payable in
respect of the issue or delivery of Common Shares on conversion of Notes
pursuant hereto. A Holder delivering a Note for conversion shall be liable for
and will be required to pay any tax or duty which may be payable in respect of
any transfer involved in the issue and delivery of Common Shares in a name other
than that of the Holder of the Note or Notes to be converted, and no such issue
or delivery shall be made unless the Person requesting such issue has paid to
the Issuer the amount of any such tax or duty, or has established to the
satisfaction of the Issuer that such tax or duty has been paid.
SECTION 14.9 COVENANT AS TO COMMON SHARES.
The Issuer and the Company, jointly and severally, covenant
that all Common Shares which may be issued upon conversion of Notes will upon
issue be fully paid and nonassessable and, except as provided in Section 14.8,
the Issuer will pay all taxes, liens and charges with respect to the issue
thereof.
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SECTION 14.10 CANCELLATION OF CONVERTED NOTES.
All Notes delivered for conversion shall be delivered to the
Trustee to be canceled by or at the direction of the Trustee, which shall
dispose of the same as provided in Section 2.11.
SECTION 14.11 EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE.
If any of following events occur, namely:
(i) any reclassification or change of the outstanding Common
Shares (including a compulsory share exchange but other than changes
resulting from a subdivision or combination), as a result of which
holders of Common Shares shall be entitled to receive stock, securities
or other property or assets (including cash or any combination thereof)
with respect to or in exchange for such Common Shares,
(ii) any merger, consolidation, statutory share exchange or
combination of the Company with another corporation as a result of
which holders of Common Shares shall be entitled to receive stock,
securities or other property or assets (including cash or any
combination thereof) with respect to or in exchange for such Common
Shares or
(iii) any sale or conveyance of all or substantially all of
the properties and assets of the Company to any other Person as a
result of which holders of Common Shares shall be entitled to receive
stock, securities or other property or assets (including cash or any
combination thereof) with respect to or in exchange for such Common
Shares,
then the Issuer and the Company or the successor or purchasing
corporation, as the case may be, shall execute with the Trustee a supplemental
indenture (which shall comply with the TIA as in force at the date of execution
of such supplemental indenture if such supplemental indenture is then required
to so comply) providing that each Note shall be convertible into the kind and
amount of shares of stock and other securities or property or assets (including
cash or any combination thereof) which the Holder thereof would have been
entitled to receive upon such reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or conveyance had such Notes been
converted into Common Shares immediately prior to such reclassification, change,
merger, consolidation, statutory share exchange, combination, sale or conveyance
assuming such holder of Common Shares did not exercise its rights of election,
if any, as to the kind or amount of securities, cash or other property
receivable upon such merger, consolidation, statutory share exchange, sale or
conveyance (provided that, if the kind or amount of securities, cash or other
property receivable upon such merger, consolidation, statutory share exchange,
sale or conveyance is not the same for each Common Share in respect of which
such rights of election shall not have been exercised ("Non-Electing Share"),
then for the purposes of this Section 14.11 the kind and amount of securities,
cash or other property receivable upon such merger, consolidation, statutory
share exchange, sale or conveyance for each Non-Electing Share shall be deemed
to be the kind and amount so receivable per share by a plurality of the
Non-Electing Shares). The Trustee shall be entitled to rely on an Opinion of
Counsel of the Issuer and the Company as to whether any such supplemental
indenture is required to and does comply with the TIA. Such supplemental
indenture shall provide for adjustments which shall be as
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nearly equivalent as may be practicable to the adjustments provided for in this
Article XIV. If, in the case of any such reclassification, change, merger,
consolidation, statutory share exchange, combination, sale or conveyance, the
stock or other securities and assets receivable thereupon by a holder of Common
Shares includes shares of stock or other securities and assets of a corporation
other than the successor or purchasing corporation, as the case may be, in such
reclassification, change, merger, consolidation, statutory share exchange,
combination, sale or conveyance, then such supplemental indenture shall also be
executed by such other corporation and shall contain such additional provisions
to protect the interests of the Holders of the Notes as the Boards of Directors
of the Issuer and the Company shall reasonably consider necessary by reason of
the foregoing, including to the extent practicable the provisions providing for
the repurchase rights set forth in Article XIII hereof.
The Issuer shall cause notice of the execution of such
supplemental indenture to be mailed to each Holder, at the address of such
Holder as it appears on the Register, within 20 days after execution thereof.
Failure to deliver such notice shall not affect the legality or validity of such
supplemental indenture.
The above provisions of this Section 14.11 shall similarly
apply to successive reclassifications, mergers, consolidations, statutory share
exchanges, combinations, sales and conveyances.
If this Section 14.11 applies to any event or occurrence,
Section 14.4 hereof shall not apply.
SECTION 14.12 RESPONSIBILITY OF TRUSTEE FOR CONVERSION PROVISIONS.
The Trustee, subject to the provisions of Section 6.1 hereof,
and any Conversion Agent shall not at any time be under any duty or
responsibility to any Holder of Notes to determine whether any facts exist which
may require any adjustment of the Conversion Price, or with respect to the
nature or intent of any such adjustments when made, or with respect to the
method employed, or herein or in any supplemental indenture provided to be
employed, in making the same. Neither the Trustee, subject to the provisions of
Section 6.1 hereof, nor any Conversion Agent shall be accountable with respect
to the validity or value (of the kind or amount) of any Common Shares, or of any
other securities or property, which may at any time be issued or delivered upon
the conversion of any Note; and it or they do not make any representation with
respect thereto. Neither the Trustee, subject to the provisions of Section 6.1
hereof, nor any Conversion Agent shall be responsible for any failure of the
Issuer or the Company to make any cash payment or to issue, transfer or deliver
any shares or share certificates or other securities or property upon the
surrender of any Note for the purpose of conversion; and the Trustee, subject to
the provisions of Section 6.1 hereof, and any Conversion Agent shall not be
responsible or liable for any failure of the Issuer or the Company to comply
with any of the covenants of the Issuer or the Company contained in this Article
XIV.
SECTION 14.13 LIMITATION ON CONVERSION RIGHT.
Notwithstanding anything to the contrary in this Article, any
Holder of a Note who (together with such Holder's affiliates) purchases more
than $10 million in aggregate
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principal amount of Notes in the initial resale by the Initial Purchasers shall
not have the right to convert any Note to the extent that, after giving effect
to such conversion, the Holder (together with the Holder's affiliates), as set
forth on the applicable conversion notice, would beneficially own in excess of
4.99% of the number of Common Shares outstanding immediately after giving effect
to such conversion. For purposes of the foregoing sentence, the number of Common
Shares beneficially owned by the Holder and its affiliates shall include the
number of Common Shares issuable upon conversion of the Note with respect to
which the determination of such sentence is being made, but shall exclude the
number of Common Shares which would be issuable upon (A) conversion of the
remaining, nonconverted portion of the Note beneficially owned by the Holder or
any of its affiliates and (B) exercise or conversion of the unexercised or
nonconverted portion of any other securities of the Issuer or the Company
(including, without limitation, any other Notes) subject to a limitation on
conversion or exercise analogous to the limitation contained herein,
beneficially owned by the Holder or any of its affiliates. Except as set forth
in the preceding sentence, for purposes of this Section 14.13, beneficial
ownership shall be calculated in accordance with Section 13(d) of the Exchange
Act. For purposes of this Section 14.13, in determining the number of
outstanding Common Shares, the Holder may rely on the number of outstanding
Common Shares as reflected in (x) the Company's most recent Quarterly Report on
Form 10-Q or Annual Report on Form 10-K, as the case may be, (y) a more recent
public announcement by the Company or (z) any subsequent notice by the Issuer,
the Company or the Company's transfer agent setting forth the number of Common
Shares outstanding. Upon the written or oral request of the Holder, the Company
shall promptly confirm in writing to the Holder the number of Common Shares then
outstanding. In any case, the number of outstanding Common Shares shall be
determined after giving effect to the conversion or exercise of securities of
the Company, including the Note, by the Holder or its affiliates since the date
as of which such number of outstanding Common Shares was reported. Neither the
Trustee nor the Conversion Agent shall be responsible for monitoring compliance
with this Section 14.13 and, absent written direction from the Issuer or Company
to the contrary, may assume that any Conversion Notice complies with this
restriction.
SECTION 14.14 OPTION TO SATISFY CONVERSION OBLIGATION WITH CASH, COMMON SHARES
OR A COMBINATION THEREOF
(a) Except to the extent that the Issuer has irrevocably
elected to make a cash payment of principal upon conversion pursuant to Section
14.14(b), the Issuer may, in lieu of delivery of Common Shares in satisfaction
of the Issuer's obligation upon conversion of the Notes by any Holder, elect to
deliver cash or a combination of cash and Common Shares. The Issuer shall notify
such Holder through the Trustee of the method the Issuer chooses to satisfy its
obligation upon conversion (the "Conversion Obligation"), (i) in the Issuer's
notice of redemption, if the Issuer has called the Notes for redemption, (ii) 26
Trading Days immediately preceding the Maturity Date in respect of Notes to be
converted during the period beginning 25 Trading Days immediately preceding the
Maturity Date and ending one Trading Day immediately preceding the Maturity
Date, and (iii) no later than two Trading Days immediately following the
Conversion Date in all other cases (such period, the "Settlement Notice
Period"). If the Issuer elects to satisfy any portion of its Conversion
Obligation in cash, the Issuer shall specify in such notice the amount to be
satisfied in cash either as a percentage of the Conversion Obligation or as a
fixed dollar amount. The Issuer shall treat all holders converting on the same
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Trading Day in the same manner. The Issuer shall not have any obligation to
satisfy Conversion Obligations arising on different Trading Days in the same
manner.
Except to the extent the Issuer has irrevocably elected to
make a cash payment of principal upon conversion and unless a Holder is
converting its notes in connection with a redemption or during the period
beginning 25 Trading Days preceding the Maturity Date and ending one Trading Day
preceding the Maturity Date, if the Issuer elects to satisfy any portion of its
conversion obligation in cash (other than cash in lieu of fractional shares),
such Holder may retract its Conversion Notice at any time during the two Trading
Day period beginning on the Trading Day after the Issuer has notified the
Trustee of its method of settlement (the "Conversion Retraction Period"). A
Holder cannot retract its Conversion Notice if: (a) the Issuer elected to make a
cash payment of principal upon conversion before such Holder delivered its
Conversion Notice; (b) such Holder is converting its Notes in connection with a
redemption; (c) such Holder is converting its Notes during the period beginning
25 Trading Days preceding the Maturity Date and ending one Trading Day preceding
the Maturity Date; or (d) the Issuer does not elect to satisfy any portion of
its conversion obligation in cash (other than cash in lieu of fractional
shares).
With respect to each Holder that exercises its conversion
right in accordance with this Indenture, if such Holder's Conversion Notice has
not been retracted, assuming all of the other requirements have been satisfied
by such Holder, then settlement (a) in Common Shares only shall occur as soon as
practicable after the Issuer notifies the Trustee that settlement shall be in
Common Shares only, and (b) in cash or in a combination of cash and Common
Shares shall occur on the second Trading Day following the final Trading Day of
the Cash Settlement Averaging Period. Such day will be the 26th Trading Day
following the receipt by the Issuer of a Holder's Conversion Notice (if such
Holder does not retract its Conversion Notice and assuming all other conversion
requirements have been satisfied), unless conversion is:
(i) in connection with a redemption, in which case such day
will be the Redemption Date;
(ii) during the period beginning 25 Trading Days preceding the
Maturity Date and ending one Trading Day preceding the Maturity Date,
in which case such day will be the Maturity Date (whether or not the
Issuer has irrevocably elected to make a cash payment of principal upon
conversion); or
(iii) after the Issuer has irrevocably elected to make a cash
payment of principal upon conversion, in which case such day will be
the 22nd Trading Day following the receipt by the Issuer of such
Holder's Conversion Notice; provided, however, that if the Issuer has
irrevocably elected to make a cash payment of principal upon conversion
and conversion is during the period beginning 25 Trading Days preceding
the Maturity Date and ending one Trading Day preceding the Maturity
Date, such day will be the Maturity Date.
The settlement amount will be computed as follows:
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(i) if the Issuer elects to satisfy the entire Conversion Obligation
in Common Shares, the Issuer will deliver to such holder a number of
shares of Common Shares equal to (1) the aggregate principal amount of the
Notes to be converted divided by 1,000, multiplied by (2) the Conversion
Rate in effect on the Conversion Date (plus cash in lieu of fractional
shares calculated as provided in Section 14.3);
(ii) if the Issuer elects to satisfy the entire Conversion
Obligation in cash, the Issuer will deliver to such holder cash in an
amount equal to the product of:
(1) a number equal to (i) the aggregate principal amount of
notes to be converted divided by 1,000 and multiplied by (ii) the
Conversion Rate in effect on the Conversion Date; and
(2) the Applicable Stock Price.
(iii) If the Issuer elects to satisfy the Conversion Obligation in a
combination of cash and common shares, it will deliver to the Holder:
(1) cash in an amount equal to (i) the fixed dollar amount per
$1,000 principal amount of Notes (which fixed dollar amount will be
specified in the notice regarding the chosen method of settlement)
multiplied by the quotient of the aggregate principal amount of Notes to
be converted divided by 1,000, or (ii) the percentage of the Conversion
Obligation (which percentage will be specified in the notice regarding the
chosen method of settlement) multiplied by the amount of cash that would
be paid pursuant to clause (ii) above, as the case may be (the "Cash
Amount"); and
(2) a number of Common Shares equal to (a)(i) the aggregate
principal amount of Notes to be converted divided by 1,000 and multiplied
by (ii) the Conversion Rate in effect on the Conversion Date minus (b) the
cash amount per $1,000 principal amount of Notes divided by the Applicable
Stock Price.
The "Applicable Stock Price" means, in respect of a Conversion Date,
the average closing sale price of the Common Shares over the 20 Trading Day
period (the "Cash Settlement Averaging Period"):
(i) ending on the second Trading Day preceding the
Redemption Date, if the Issuer has called the notes for redemption;
(ii) ending on the second Trading Day preceding the Maturity Date,
with respect to Conversion Notices received during the period beginning 25
Trading Days preceding the Maturity Date and ending one Trading Day
preceding the Maturity Date (whether or not the Issuer has irrevocably
elected to make a cash payment of principal upon conversion);
(iii) beginning on the Trading Day following the receipt by the
Issuer of a Holder's Conversion Notice, if the Issuer has irrevocably
elected to make a cash payment of principal upon conversion; provided,
however, that if the Issuer has irrevocably elected to make a cash payment
of principal upon conversion and such Holder submit its
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Conversion Notice during the period beginning 25 Trading Days preceding
the Maturity Date and ending one Trading Day preceding the Maturity Date,
the Cash Settlement Averaging Period shall end on the second Trading Day
preceding the Maturity Date; and
(iv) beginning on the Trading Day following the final Trading Day of
the Conversion Retraction Period, in all other cases.
(b) Notwithstanding anything to the contrary in this Indenture, at
any time prior to the 26th Trading Day preceding the Maturity Date, the Issuer
may irrevocably elect, in its sole discretion without the consent of the Holders
of the Notes, by written notice to the Trustee and the Holders of the Notes, to
satisfy in cash the Conversion Obligation with respect to the principal amount
of Notes to be converted after the date of such election, with any remaining
amount of the Conversion Obligation to be satisfied in cash and/or Common
Shares. If the Issuer makes such election, the Issuer will notify the Trustee
and the Holders of Notes at their addresses shown in the Register of the
Registrar. The settlement amount will be computed as follows:
(i) a cash amount equal to the aggregate principal amount of
Notes to be converted; and
(ii) (1) if the Issuer elects to satisfy any remaining amount in
Common Shares, the Issuer will deliver to the Holder a number of shares
equal to:
(A) the aggregate principal amount of Notes to be converted
divided by 1,000 and multiplied by
(B) (1) the Conversion Rate in effect on the Conversion Date
minus (2) $1,000 divided by the Applicable Stock Price
plus cash in lieu of fractional shares calculated as provided
in Section 14.3,
(2) if the Issuer elects to satisfy any remaining amount in
cash, the Issuer will deliver to the Holder cash in an amount equal to the
product of:
(A) a number equal to (1) the aggregate principal amount of
Notes to be converted divided by 1,000 and multiplied by (2)(x) the
Conversion Rate in effect on the Conversion Date minus (y) $1,000 divided
by the Applicable Stock Price; and
(B) the Applicable Stock Price, and
(3) if the Issuer elects to satisfy any remaining amount in a
combination of cash and Common Shares, it will deliver to the Holder such
combination in the respective amounts calculated in a manner comparable to
that used to settle any conversion (as described above), and with the
amount of cash specified by the Issuer as contemplated in connection with
any such conversion.
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ARTICLE XV.
SUBORDINATION OF NOTES
SECTION 15.1 NOTES SUBORDINATED TO SENIOR DEBT.
Notwithstanding any other provision of this Indenture, the Issuer,
the Company and the Trustee each covenants and agrees, and each Holder, by its
acceptance of a Note, likewise covenants and agrees, that all Notes shall be
issued subject to the provisions of this Article XV and each Person holding any
Note, whether upon original issue or upon transfer, assignment or exchange
thereof, accepts and agrees that the Notes, and all payments in respect thereof
including any payments on account of the Make Whole Premium, shall, to the
extent set forth in this Article XV, be subordinated in right of payment to the
prior payment in full, in cash or cash equivalents, of all amounts that
constitute Senior Debt, including, without limitation, the Issuer's obligations
under the Senior Bank Facilities.
The Notes will be on parity in the right of payment with the
Issuer's other existing and future liabilities that are not otherwise
subordinated in favor of the notes.
The Notes will be senior in the right of payment to all other
indebtedness of the Issuer that by its terms is expressly subordinate to the
Notes.
SECTION 15.2 NO PAYMENT ON NOTES IN CERTAIN CIRCUMSTANCES.
(a) No direct or indirect payment on account of the Notes or on
account of the purchase or redemption or other acquisition of Notes by or on
behalf of the Issuer shall be made if, at the time of such payment, there shall
have occurred and be continuing a default in the payment of principal of (or
premium, if any) or interest on Senior Debt (including without limitation upon
acceleration of the maturity thereof) when due (a "Senior Payment Default").
(b) In addition, if any default (other than a Senior Payment
Default) with respect to any Senior Debt permitting, or which with the giving of
notice of lapse of time (or both) would permit, the holders thereof (or a
trustee on behalf thereof) to accelerate the maturity thereof (a "Senior
Non-monetary Default") has occurred and is continuing and the Issuer and the
Trustee have received written notice thereof from the agent bank for any Credit
Facility Debt or from an authorized person on behalf of Designated Senior Debt,
then the Issuer may not make any payments on account of the Notes or on account
of the purchase or redemption or other acquisition of Notes or on account of the
purchase or redemption or other acquisition Notes for a period (a "Payment
Blockage Period") commencing on the date the Issuer and the Trustee receive such
written notice and ending on the earlier of (i) 179 days after such date or on
the date on which the Trustee receives notice from the agent bank for the Credit
Facility Debt or from any authorized person on behalf of any Designated Senior
Debt, as applicable, rescinding such notice and (ii) the date, if any, on which
the Senior Debt to which such default relates is discharged or such default is
waived or otherwise cured provided that no other default then exists except, in
each case, any acceleration of the Senior Debt.
(c) Not more than one Payment Blockage Period pursuant to Section
15.2(b) or 15.2(c) may be commenced with respect to the Notes during any period
of 360 consecutive
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days; provided that, subject to the limitations set forth in the next sentence,
the commencement of a Payment Blockage Period by the representatives for, or the
holders of, Designated Senior Debt, other than under the Credit Facility Debt,
shall not bar the commencement of another Payment Blockage Period by the agent
bank for the Credit Facility Debt within such period of 360 consecutive days.
Notwithstanding anything in this Indenture to the contrary, there must be 180
consecutive days in any 360-day period in which no Payment Blockage Period is in
effect. For all purposes of Section 15.2(b) or 15.2(c), no event of default that
existed or was continuing (it being acknowledged that any subsequent action that
would give rise to an event of default pursuant to any provision under which an
event of default previously existed or was continuing shall constitute a new
event of default for this purpose) on the date of the commencement of any
Payment Blockage Period with respect to the Designated Senior Debt or Credit
Facility Debt initiating such Payment Blockage Period shall be, or shall be
made, the basis for the commencement of a second Payment Blockage Period by the
representative for, or the holders of, such Designated Senior Debt or Credit
Facility Debt, whether or not within a period of 360 consecutive days, unless
such event of default shall have been cured or waived for a period of not less
than 90 consecutive days.
SECTION 15.3 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
(a) Upon any payment or distribution of assets or securities of the
Issuer to creditors of any kind or character, whether in cash, property or
securities, in connection with any dissolution or winding up or total or partial
liquidation or reorganization of the Issuer, whether voluntary or involuntary,
or in a bankruptcy, insolvency, receivership or other proceedings, the Holders
of Senior Debt will first be entitled to receive payment in full in cash or cash
equivalents of principal of (and premium, if any) and interest on such Senior
Debt (whether or not allowed in such proceeding) before the Holders are entitled
to receive any payment of principal of (an premium, if any) or interest on the
notes or on account of the purchase or redemption or other acquisition of the
Notes by the Issuer or any of its subsidiaries. In the event that
notwithstanding the foregoing, the Trustee or the Holder of any Note receives
any payment or distribution of the Issuer's assets of any kind or character
(excluding shares of Issuer's common stock or securities provided for in a plan
reorganization or readjustment which are subordinate in right of payment to all
Senior Debt to substantially the same extent as the Notes are so subordinated)
before all the Senior Debt is paid in full, then such payment or distribution
will be required to be paid over or delivered forthwith to the trustee in
bankruptcy or other Person making payment or distribution of our assets for
application to the payment of all Senior Debt remaining unpaid, to the extent
necessary to pay the Senior Debt in full.
(b) To the extent any payment of Senior Debt of the Issuer (whether
by or on behalf of the Issuer, as proceeds of security or enforcement of any
right of setoff or otherwise) is declared to be fraudulent or preferential, set
aside or required to be paid to any receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person under any bankruptcy, insolvency,
receivership, fraudulent conveyance or similar law, then if such payment is
recovered by, or paid over to, such receiver, trustee in bankruptcy, liquidating
trustee, agent or other similar Person, the Senior Debt of the Issuer or part
thereof originally intended to be satisfied shall be deemed to be reinstated and
outstanding as if such payment had not occurred. To the extent the obligation to
repay any Senior Debt of the Issuer is declared to be fraudulent, invalid or
otherwise set aside under any bankruptcy, insolvency, receivership, fraudulent
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conveyance or similar law, then the obligations so declared fraudulent, invalid
or otherwise set aside (and all other amounts that would come due with respect
thereto had such obligation not been so affected) shall be deemed to be
reinstated and outstanding as Senior Debt of the Issuer for all purposes of this
Indenture as if such declaration, invalidity or setting aside had not occurred.
(c) In the event that, notwithstanding the foregoing provision
prohibiting such payment or distribution, any payment or distribution of assets
or securities of the Issuer of any kind or character, whether in cash, property
or securities, shall be received by the Trustee or any Holder at a time when
such payment or distribution is prohibited by Section 15.3(a) and before all
obligations in respect of Senior Debt of the Issuer are paid in full, in cash or
cash equivalents, such payment or distribution shall be received and held in
trust for the benefit of, and shall be paid over or delivered to, the holders of
Senior Debt of the Issuer (pro rata to such holders on the basis of the
respective amounts of Senior Debt of the Issuer held by such holders) or their
representatives or to the trustee or trustees under any indenture pursuant to
which any such Senior Debt of the Issuer may have been issued, as their
respective interests appear, for application to the payment of Senior Debt of
the Issuer remaining unpaid until all such Senior Debt of the Issuer has been
paid in full, in cash or cash equivalents, after giving effect to any concurrent
payment, distribution or provision therefor to or for the holders of such Senior
Debt of the Issuer.
(d) The consolidation of the Issuer with, or the merger of the
Issuer with or into, another Person or the liquidation or dissolution of the
Issuer following the sale, conveyance, transfer, lease or other disposition of
all or substantially all of its property and assets to another Person upon the
terms and conditions provided in Article VII hereof shall not be deemed a
dissolution, winding up, liquidation or reorganization for the purposes of this
Section 15.3 if such other Person shall, as a part of such consolidation,
merger, sale, conveyance, transfer, lease or other disposition, comply (to the
extent required) with the conditions stated in Article VII hereof.
SECTION 15.4 SUBROGATION.
Upon the payment in full of all Senior Debt in cash or cash
equivalents, the Holders shall be subrogated to the rights of the holders of
Senior Debt to receive payments or distributions of cash, property or securities
of the Issuer made on such Senior Debt until the principal of and interest on
the Notes shall be paid in full; and, for the purposes of such subrogation, no
payments or distributions to the holders of such Senior Debt of any cash,
property or securities to which the Holders or the Trustee on their behalf would
be entitled except for the provisions of this Article XV, and no payment
pursuant to the provisions of this Article XV to the holders of Senior Debt by
Holders or the Trustee on their behalf shall, as between the Issuer, its
creditors other than holders of Senior Debt, and the Holders, be deemed to be a
payment by the Issuer to or on account of the Senior Debt. It is understood that
the provisions of this Article XV are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and the holders of
the Senior Debt, on the other hand.
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SECTION 15.5 OBLIGATIONS OF THE ISSUER UNCONDITIONAL.
(a) Nothing contained in this Article XV or elsewhere in this
Indenture or in the Notes is intended to or shall impair, as among the Issuer
and the Holders, the obligation of the Issuer, which is absolute and
unconditional, to pay to the Holders the principal of and interest on the Notes
as and when the same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of the Holders and
creditors of the Issuer other than the holders of the Senior Debt, nor shall
anything herein or therein prevent the Holders or the Trustee on their behalf
from exercising all remedies otherwise permitted by applicable law upon default
under this Indenture, subject to the rights, if any, under this Article XV of
the holders of the Senior Debt.
(b) Without limiting the generality of the foregoing, nothing
contained in this Article XV will restrict the right of the Trustee or the
Holders to take any action to declare the Notes to be due and payable prior to
their maturity or to pursue any rights or remedies hereunder; provided, however,
that all Senior Debt then due and payable or thereafter declared to be due and
payable shall first be paid in full, in cash or cash equivalents, before the
Holders or the Trustee are entitled to receive any direct or indirect payment
from the Issuer under the Notes.
SECTION 15.6 NOTICE TO TRUSTEE.
(a) The Issuer shall give prompt written notice to the Trustee of
any fact known to the Issuer that would prohibit the making of any payment to or
by the Trustee in respect of the Notes pursuant to the provisions of this
Article XV. The Trustee shall not be charged with knowledge of the existence of
any Senior Payment Default or Senior Non-monetary Default with respect to any
Senior Debt or of any other facts that would prohibit the making of any payment
to or by the Trustee unless and until the Trustee shall have received notice in
writing to that effect signed by an Officer of the Issuer, or by a holder of
Senior Debt or trustee or agent thereof; and prior to the receipt of any such
written notice, the Trustee shall, subject to this Article XV, be entitled to
assume that no such facts exist; provided that, if the Trustee shall not have
received the notice provided for in this Section 15.6 at least two Business Days
prior to the date upon which, by the terms of this Indenture, any monies shall
become payable for any purpose (including, without limitation, the payment of
the principal of or interest on any Note), then, notwithstanding anything herein
to the contrary, the Trustee shall have full power and authority to receive any
monies from the Issuer and to apply the same to the purpose for which they were
received, and shall not be affected by any notice to the contrary that may be
received by it on or after such prior date except for an acceleration of the
Notes prior to such application. Nothing contained in this Section 15.6 shall
limit the right of the holders of Senior Debt to recover payments as
contemplated by this Article XV. The foregoing shall not apply if the paying
agent is the Issuer. The Trustee shall be entitled to rely on the delivery to it
of a written notice by a Person representing himself or itself to be a holder of
any Senior Debt (or a trustee on behalf of, or other representative of, such
holder) to establish that such notice has been given by a holder of such Senior
Debt or a trustee or representative on behalf of any such holder.
(b) In the event that the Trustee determines in good faith that any
evidence is required with respect to the right of any Person as a holder of
Senior Debt to participate in any payment or distribution pursuant to this
Article XV, the Trustee may request such Person to
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furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Debt held by such Person, the extent to which such Person is entitled
to participate in such payment or distribution and any other facts pertinent to
the rights of such Person under this Article XV and, if such evidence is not
furnished to the Trustee, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
SECTION 15.7 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT.
Upon any payment or distribution of assets or securities referred to
in this Article XV, the Trustee and the Holders shall be entitled to rely upon
any order or decree made by any court of competent jurisdiction in which
bankruptcy, dissolution, winding up, liquidation or reorganization proceedings
are pending, or upon a certificate of the receiver, trustee in bankruptcy,
liquidating trustee, agent or other similar Person making such payment or
distribution, delivered to the Trustee or to the Holders for the purpose of
ascertaining the persons entitled to participate in such distribution, the
holders of the Senior Debt and other indebtedness of the Issuer, the amount
thereof or payable thereon, the amount or amounts paid or distributed thereon
and all other facts pertinent thereto or to this Article XV.
SECTION 15.8 TRUSTEE'S RELATION TO SENIOR DEBT.
(a) The Trustee and any paying agent shall be entitled to all the
rights set forth in this Article XV with respect to any Senior Debt that may at
any time be held by it in its individual or any other capacity to the same
extent as any other holder of Senior Debt and nothing in this Indenture shall
deprive the Trustee or any paying agent of any of its rights as such holder.
(b) With respect to the holders of Senior Debt, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article XV, and no implied covenants or
obligations with respect to the holders of Senior Debt shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Senior Debt (except as provided in Section
15.2(b), Section 15.3(a) and Section 15.3(c)).
SECTION 15.9 SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS OF THE
ISSUER OR HOLDERS OF SENIOR DEBT.
No right of any present or future holders of any Senior Debt to
enforce subordination as provided in this Article XV will at any time in any way
be prejudiced or impaired by any act or failure to act on the part of the Issuer
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Issuer with the terms of this Indenture, regardless of any
knowledge thereof that any such holder may have or otherwise be charged with.
The provisions of this Article XV are intended to be for the benefit of, and
shall be enforceable directly by, the holders of Senior Debt.
SECTION 15.10 HOLDERS AUTHORIZE TRUSTEE TO EFFECTUATE THE SUBORDINATION OF
THE NOTES.
Each Holder, by such Holder's acceptance of any Notes, authorizes
and expressly directs the Trustee on such Holder's behalf to take such action as
may be necessary or
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appropriate to effectuate the subordination provided in this Article XV, and
appoints the Trustee such Holder's attorney-in-fact for such purposes,
including, in the event of any dissolution, winding up, liquidation or
reorganization of the Issuer (whether in bankruptcy, insolvency, receivership,
reorganization or similar proceedings or upon an assignment for the benefit of
creditors or otherwise) tending towards liquidation of the property and assets
of the Issuer, the filing of a claim for the unpaid balance of its Notes, if
any, in the form required in those proceedings. If the Trustee does not file a
proper claim or proof of indebtedness in the form required in such proceeding at
least 30 days before the expiration of the time to file such claim or claims,
each holder of Senior Debt is hereby authorized to file an appropriate claim for
and on behalf of the Holders.
SECTION 15.11 NOT TO PREVENT EVENTS OF DEFAULT.
The failure to make a payment on account of principal of or interest
on the Notes by reason of any provision of this Article XV will not be construed
as preventing the occurrence of an Event of Default.
SECTION 15.12 TRUSTEE'S COMPENSATION NOT PREJUDICED.
Nothing in this Article XV will apply to amounts due to the Trustee
pursuant to other sections of this Indenture.
SECTION 15.13 NO WAIVER OF SUBORDINATION PROVISIONS.
Without in any way limiting the generality of Section 15.9, the
holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders, without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article XV or the obligations hereunder of the
Holders to the holders of Senior Debt, do any one or more of the following: (a)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Debt or any instrument evidencing the same or any
agreement under which Senior Debt is outstanding or secured; (b) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt; (c) release any Person liable in any manner for the
collection of Senior Debt; and (d) exercise or refrain from exercising any
rights against the Issuer and any other Person.
SECTION 15.14 PAYMENTS MAY BE PAID PRIOR TO DISSOLUTION.
Nothing contained in this Article XV or elsewhere in this Indenture
shall prevent (i) the Issuer, except under the conditions described in Section
15.2 or Section 15.3, from making payments of principal of and interest on the
Notes, or from depositing with the Trustee any money for such payments, or (ii)
the application by the Trustee of any money deposited with it for the purpose of
making such payments of principal of and interest on the Notes to the Holders
entitled thereto unless, at least two Business Days prior to the date upon which
such payment becomes due and payable, the Trustee shall have received the
written notice provided for in Section 15.2(b) (or there shall have been an
acceleration of the Notes prior to such application)
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or in Section 15.6. The Issuer shall give prompt written notice to the Trustee
of any dissolution, winding up, liquidation or reorganization of the Issuer.
ARTICLE XVI.
OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 16.1 TRUST INDENTURE ACT CONTROLS.
This Indenture is subject to the provisions of the TIA which are
required to be part of this Indenture, and shall, to the extent applicable, be
governed by such provisions.
SECTION 16.2 NOTICES.
Any notice or communication to the Issuer and/or the Company or the
Trustee is duly given if in writing and delivered in person or mailed by
first-class mail or by overnight delivery service to the address set forth
below:
(a) if to the Issuer and the Company:
Lions Gate Entertainment Corp.
555 Brooksbank Avenue
North Vancouver, British Columbia, V7J 3S5
Lions Gate Entertainment Inc.
2700 Colorado Avenue, Suite 200
Santa Monica, CA 90404
Attention: Chief Financial Officer
with a copy to:
O'Melveny & Myers LLP
1999 Avenue of the Stars, 7th Floor
Los Angeles, CA 90067-6035
Attention: Allison Keller
(b) if to the Trustee:
J.P. Morgan Trust Company, National Association
560 Mission St., 13th Floor
San Francisco, CA 94105
Attention: Corporate Trust Department
The Issuer and 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 to a Holder shall be mailed by
first-class mail to his address shown on the Register kept by the Registrar or,
if the Holder is the Depositary, sent by
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facsimile or overnight delivery services. Failure to mail a notice or
communication to a Holder or any defect in such notice or communication shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed or sent in the manner
provided above within the time prescribed, it is duly given as of the date it is
mailed, whether or not the addressee receives it, except that notice to the
Trustee shall only be effective upon receipt thereof by the Trustee.
If the Issuer and the Company mail a notice or communication to
Holders, it shall mail a copy to the Trustee at the same time.
SECTION 16.3 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Holders may communicate pursuant to Section 312(b) of the TIA with
other Holders with respect to their rights under the Notes or this Indenture.
The Company, the Trustee, the Registrar and anyone else shall have the
protection of Section 312(c) of the TIA.
SECTION 16.4 ACTS OF HOLDERS OF NOTES.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders of Notes may be embodied in and evidenced by:
(1) one or more instruments of substantially similar tenor
signed by such Holders in person or by agent or proxy duly appointed in
writing;
(2) the record of Holders of Notes voting in favor thereof,
either in person or by proxies duly appointed in writing, at any meeting
of Holders of Notes duly called and held in accordance with the provisions
of Article IX; or
(3) a combination of such instruments and any such record.
Except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments or record or both are
delivered to the Trustee and, where it is hereby expressly required, to the
Issuer and the Company. Such instrument or instruments and record (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act of the Holders" of Notes signing such instrument or instruments and
so voting at such meeting. Proof of execution of any such instrument or of a
writing appointing any such agent or proxy, or of the holding by any Person of a
Note, shall be sufficient for any purpose of this Indenture and (subject to
Section 7.1 hereof) conclusive in favor of the Trustee and the Issuer and the
Company if made in the manner provided in this Section. The record of any
meeting of Holders of Notes shall be proved in the manner provided in Section
9.6 hereof.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be provided in any manner which the Trustee reasonably
deems sufficient.
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(c) The principal amount and serial numbers of Notes held by any
Person, and the date of such Person holding the same, shall be proved by the
Register.
(d) Any request, demand, authorization, direction, notice, consent,
election, waiver or other Act of the Holders of any Note shall bind every future
Holder of the same Note and the Holder of every Note issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee, the
Issuer or the Company in reliance thereon, whether or not notation of such
action is made upon such Note.
SECTION 16.5 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents. Any
certificate or opinion of an officer of the Issuer and/or the Company may be
based, insofar as it relates to legal matters, upon an Opinion of Counsel of the
Issuer and/or the Company, as the case may be, unless such officer knows, or in
the exercise of reasonable care should know, that the Opinion of Counsel of the
Issuer and/or the Company, as the case may be, with respect to the matters upon
which such certificate or opinion is based is erroneous. Any such Opinion of
Counsel may be based, insofar as it relates to factual matters, upon a
certificate or representations by, an officer or officers of the Issuer and/or
the Company stating that the information with respect to such factual matters is
in the possession of the Issuer and/or the Company, unless such counsel knows,
or in the exercise of reasonable care should know, that the certificate or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Upon any application or request by the Issuer and the Company to the
Trustee to take any action under any provision of this Indenture, the Issuer and
the Company shall furnish to the Trustee an Officers' Certificate of the Issuer
and the Company stating that all conditions precedent, if any, provided for in
this Indenture relating to the proposed action have been complied with and an
Opinion of Counsel of the Issuer and the Company stating that in the opinion of
such Counsel all such conditions precedent, if any, have been complied with,
except that in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Indenture relating to such particular application or request, no additional
certificate or opinion need be furnished.
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SECTION 16.6 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such certificate
or opinion on behalf of the Issuer or the Company has read such covenant
or condition and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 16.7 EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction hereof.
SECTION 16.8 SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Indenture by the Issuer and the
Company shall bind their successors and assigns, whether so expressed or not.
SECTION 16.9 SEPARABILITY CLAUSE.
In case any provision in this Indenture or the Notes 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 16.10 BENEFITS OF INDENTURE.
Nothing contained in this Indenture or in the Notes, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and the Holders of Notes, any benefit or legal or equitable
right, remedy or claim under this Indenture.
SECTION 16.11 GOVERNING LAW.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
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SECTION 16.12 COUNTERPARTS.
This instrument may be executed in any number of counterparts, each
of which when so executed shall be deemed to be an original but all such
counterparts shall together constitute but one and the same instrument.
SECTION 16.13 LEGAL HOLIDAYS.
In any case where any Interest Payment Date, Optional Redemption
Date, Special Repurchase Date, Designated Event Repurchase Date or stated
maturity of any Note shall not be a Business Day at any Place of Payment, then
(notwithstanding any other provision of this Indenture or of the Notes) payment
of interest (including Additional Interest, if any) or principal or premium, if
any, need not be made at such Place of Payment on such day, but may be made on
the next succeeding Business Day at such Place of Payment with the same force
and effect as if made on the Interest Payment Date, Optional Redemption Date,
Special Repurchase Date, Designated Event Repurchase Date or at the stated
maturity, provided, that in the case that payment is made on such succeeding
Business Day, no interest shall accrue on the amount so payable for the period
from and after such Interest Payment Date, Optional Redemption Date, Special
Repurchase Date, Designated Event Repurchase Date or stated maturity, as the
case may be.
SECTION 16.14 RECOURSE AGAINST OTHERS.
No recourse for the payment of the principal of or premium, if any,
or interest (including Additional Interest, if any) on any Note, or for any
claim based thereon or otherwise in respect thereof, shall be had against any
incorporator, shareholder, officer or director, as such, past, present or
future, of the Issuer, the Company or of any their respective successor
corporation, whether by virtue of any constitution, statute or rule of law or by
the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance thereof and as part of the consideration for the issue
thereof, expressly waived and released.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed all as of the day and year first above written.
LIONS GATE ENTERTAINMENT INC.
By:_________________________________
Name:
Title:
LIONS GATE ENTERTAINMENT CORP.
By:_________________________________
Name:
Title:
J.P. MORGAN TRUST COMPANY,
NATIONAL ASSOCIATION
By:_________________________________
Name:
Title:
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EXHIBIT A
FORM OF NOTE
[Face of Note]
LIONS GATE ENTERTAINMENT INC.
[Certificate No. _______]
[INSERT RESTRICTIVE SECURITIES LEGEND AND GLOBAL NOTE
LEGEND AS REQUIRED]
2.9375% CONVERTIBLE SENIOR SUBORDINATED NOTE DUE 2024
CUSIP NO. ____________
LIONS GATE ENTERTAINMENT INC., a Delaware corporation (herein called
the "ISSUER"), for value received, hereby promises to pay to Cede & Co. or
registered assigns, the principal sum of [dollar amount] ([$ AMOUNT]) on [DATE],
2024 and interest thereon, as provided on the reverse hereof, until the
principal and any unpaid and accrued interest is paid or duly provided for. The
right to payment of the principal and all other amounts due with respect hereto
is subordinated to the rights of Senior Debt as set forth in the Indenture
referred to on the reverse side hereof.
Interest Payment Dates: April 15 and October 15, with the first
payment to be made on April 15, 2005.
Record Dates: April 1 and October 1.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH
ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE
SAME EFFECT AS IF SET FORTH AT THIS PLACE.
IN WITNESS WHEREOF, LIONS GATE ENTERTAINMENT INC. has caused this
instrument to be duly signed.
LIONS GATE ENTERTAINMENT INC.
By:________________________________________
Name:
Title:
Dated: ____________
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TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes referred to in the within-mentioned
Indenture.
J.P. MORGAN TRUST COMPANY, NATIONAL ASSOCIATION, as Trustee
By:
-------------------------------------------------
Authorized Signatory
Dated:
------------
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[REVERSE OF NOTE]
LIONS GATE ENTERTAINMENT INC.
2.9375% CONVERTIBLE SENIOR SUBORDINATED NOTE DUE 2024
1. INTEREST. LIONS GATE ENTERTAINMENT INC., a Delaware corporation (the
"ISSUER"), promises to pay interest on the principal amount of this Note
at the rate PER ANNUM shown above. The Issuer will pay interest
semi-annually on April 15 and October 15 of each year, with the first
payment to be made on April 15, 2005. Interest on the Notes will accrue on
the principal amount from the most recent date to which interest has been
paid or provided for or, if no interest has been paid, from October 4,
2004. Interest will be computed on the basis of a 360-day year of twelve
30-day months.
The Holder of this Note is entitled to the benefits of a Note Guarantee
whereby Lions Gate Entertainment Corp., a British Columbia corporation and
parent of the Issuer (the "COMPANY"), has fully and unconditionally
guaranteed, as primary obligor and not merely as surety, to each Holder
and the Trustee, the payment of principal and interest on this Note on an
unsecured senior subordinated basis.
2. MATURITY. The Notes will mature on October 15, 2024 ("MATURITY").
3. METHOD OF PAYMENT. The Issuer will pay interest on the Notes (except
defaulted interest) to the persons who are registered Holders at the close
of business on the record date set forth on the face of this Note next
preceding the applicable interest payment date. Holders must surrender
Notes to a Paying Agent to collect the principal, Optional Redemption
Price, Optional Repurchase Price, Special Repurchase Price or Designated
Repurchase Price of the Notes. The Issuer will pay all amounts due with
respect to the Notes in money of the United States that at the time of
payment is legal tender for payment of public and private debts. If this
Note is in global form, the Issuer will pay interest on the Notes by wire
transfer of immediately available funds to The Depository Trust Company.
With respect to Notes held other than in global form, the Issuer will make
payments: (i) by U.S. Dollar check drawn on a bank in The City of New York
mailed to the address of the Holder; or (ii) upon application to the
Registrar not later than the relevant Record Date by a Holder of an
aggregate principal amount in excess of $5,000,000, by wire transfer in
immediately available funds.
4. PAYING AGENT, REGISTRAR, CONVERSION AGENT. Initially, J.P. Morgan Trust
Company, National Association, (the "TRUSTEE") will act as Paying Agent
and Registrar and the Company will act as Conversion Agent. The Issuer may
change any Paying Agent, Registrar or Conversion Agent without notice. The
Issuer or any Affiliate of the Issuer may act as Paying Agent.
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5. INDENTURE. The Issuer issued the Notes under an Indenture dated as of
October 4, 2004 (the "INDENTURE") between the Issuer, the Company and the
Trustee. The terms of the Notes include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act
of 1939 (15 U.S. Code Sections 77aaa-77bbbb) (the "ACT") as in effect on
the date of the Indenture. The Notes are subject to all such terms, and
Holders are referred to the Indenture and the Act for a statement of such
terms. The Notes are general unsecured senior subordinated obligations of
the Issuer limited to $150,000,000 aggregate principal amount (including
$25,000,000 principal amount of Notes issued pursuant to the exercise in
full of an option by the Initial Purchasers (as defined in the Indenture)
to cover over-allotments on September 29, 2004), except as otherwise
provided in the Indenture. Terms used herein which are defined in the
Indenture have the meanings assigned to them in the Indenture.
6. OPTIONAL REDEMPTION. The Notes shall be redeemable, in whole or from time
to time in part, at the option of the Issuer and subject to the terms and
conditions of the Indenture, on any Trading Day on or after October 15,
2009 (an "OPTIONAL REDEMPTION DATE"), at a redemption price equal to, (i)
if the Optional Redemption Date occurs on or after October 15, 2009 but
before October 15, 2010, 100.839%, (ii) if the Optional Redemption Date
occurs on or after October 15, 2010 but before October 15, 2011, 100.420%,
or (iii) if the Optional Redemption Date occurs on or after October 15,
2011, 100%, of the principal amount of the Notes to be redeemed plus
accrued and unpaid interest on the principal amount to be redeemed, to,
but excluding, the Optional Redemption Date (the "OPTIONAL REDEMPTION
PRICE"). Notice of any such redemption by the Issuer will be given at
least 20, but not more than 60, days before any Optional Redemption Date
to each Holder of Notes to be redeemed at such Holder's registered
address. The Issuer shall pay or deposit funds with the Paying Agent in
the amount of the Optional Redemption Price on or before the Trading Day
immediately preceding the Optional Redemption Date. If notice of such a
redemption is provided and funds are paid or deposited as required on or
before the Optional Redemption Date, interest on and after the Optional
Redemption Date will cease to accrue on the Notes or portions of Notes
called for such a redemption. In the event that any Optional Redemption
Date is not a Business Day, the Issuer will pay the Optional Redemption
Price on the next Business Day without any additional interest or other
payment due. If less than all the Notes are to be redeemed at the option
of the Issuer, the Trustee shall select, by lot, on a pro rata basis or
otherwise in accordance with the applicable procedures of the DTC, the
Notes and portions of Notes to be redeemed. The Trustee may select for
redemption Notes and portions of Notes of this series in amounts of whole
multiples of $1,000 principal amount. Notes in denominations larger than
$1,000 principal amount may be redeemed in part but only in whole
multiples of $1,000 principal amount.
7. REPURCHASE AT OPTION OF HOLDER ON SPECIFIED DATES. On October 15, 2011,
October 15, 2014 and October 15, 2019 (each a "SPECIFIED REPURCHASE
DATE"), each Holder shall have the right, at such Holder's option and
subject to the terms
A-4
and conditions of the Indenture, to require the Issuer to purchase any or
all of such Holder's Notes or any portion of the principal amount thereof
that is equal to $1,000 or whole multiples thereof for a repurchase price
equal to 100% of the principal amount of the Notes repurchased plus
accrued and unpaid interest and additional interest, if any, to, but
excluding, the Specified Repurchase Date (the "SPECIFIED REPURCHASE
PRICE"), provided that such interest will be paid to the person who was
the registered Holder at the close of business on the record date for the
corresponding interest payment date. Notice of each Specified Repurchase
Date containing the information required to be set forth in such notice by
the Indenture shall be given by the Issuer to each Holder at its
registered address not less than 20 Business Days prior to each Specified
Repurchase Date. Each Holder electing to require the Issuer to repurchase
the Holder's Notes shall submit such Notes to be repurchased, together
with such other information and documents as required by the Indenture, to
the Paying Agent on or before the close of business on the Specified
Repurchase Date. In the event that a Holder submits Notes to be
repurchased, the Issuer shall pay or deposit funds with the Paying Agent
in the amount of the Specified Repurchase Price on the Trading Day
immediately following the Specified Repurchase Date. If a Holder submits
Notes to be repurchased and funds are paid or deposited as required,
interest on and after the Specified Repurchase Date will cease to accrue
on the Notes or portions of Notes submitted for repurchase.
8. REPURCHASE AT OPTION OF HOLDER UPON A DESIGNATED EVENT. If a Designated
Event (as set forth in the Indenture) shall occur at any time prior to
Maturity, each Holder shall have the right, at such Holder's option and
subject to the terms and conditions of the Indenture, to require the
Issuer to purchase any or all of such Holder's Notes for cash or any
portion of the principal amount thereof that is equal to $1,000 or whole
multiples thereof for a repurchase price equal to 100% of the principal
amount of the Notes purchased plus accrued and unpaid interest to, but
excluding, the Designated Repurchase Date (the "DESIGNATED REPURCHASE
PRICE"), provided that such interest will be paid to the person who was
the registered Holder at the close of business on the record date for the
corresponding interest payment date. Notice of the occurrence and type of
Designated Event and containing the information required to be set forth
in such notice by the Indenture (the "DESIGNATED EVENT NOTICE"),
including, without limitation, the date selected by the Issuer that is not
less than 20 nor more than 30 Business Days after the date of the
Designated Event Notice (the "DESIGNATED REPURCHASE DATE"), shall be given
by the Issuer to each Holder at such Holder's registered address, as well
as to the Trustee, not more than 10 days after the Issuer has become aware
of such an occurrence. Each Holder electing to require the Issuer to
repurchase the Holder's Notes shall submit such Notes to be repurchased,
together with such other information and documents as are required by the
Indenture, to the Issuer or its designated agent on or before the close of
business on the Designated Repurchase Date. If the Designated Event is a
Change in Control, there shall, under certain circumstances, be added to
and the Designated Repurchase Price shall include a Make Whole Premium as
set forth in the Indenture and the Issuer
A-5
shall pay the Designated Repurchase Price in cash. If the Designated Event
is a Termination of Trading, the Issuer shall pay the Designated
Repurchase Price in cash. In the event that a Holder submits Notes to be
repurchased, the Issuer shall pay or deposit funds and/or Common Shares,
as applicable, with the Paying Agent in the amount of the Designated
Repurchase Price on the Trading Day immediately following the Designated
Repurchase Date. If a Holder submits Notes to be repurchased and funds
and/or Common Shares, as applicable, are paid or deposited as required,
interest on and after the Designated Repurchase Date will cease to accrue
on the Notes or portions of Notes submitted for repurchase.
In the event that of a Change of Control occurs that would otherwise
trigger the obligation of the Issuer to pay the Make Whole Premium, the
Issuer may elect instead to provide that the Notes become convertible into
Common Shares of the Public Entity, subject to certain conditions as
specified in the Indenture.
9. CONVERSION. Subject to and upon compliance with the provisions of the
Indenture, a Holder is entitled until the close of business on the Trading
Day immediately preceding the Maturity Date, at its option, to convert any
Notes that are whole multiples of $1,000 principal amount into Common
Shares (or, at the option of the Issuer, into cash or a combination of
cash and Common Shares) at the Conversion Rate in effect at the time of
conversion, subject to the adjustments described below, only during
specified periods under any of the following circumstances:
(i) if, on or prior to October 15, 2019, the Closing Sale Price of
the Common Shares for at least 20 Trading Days in the 30 consecutive
Trading Day period ending on the eleventh Trading Day of any fiscal
quarter exceeds 120% of the then-current Conversion Price in effect, then
the Holder will be entitled to convert such Notes until the eleventh
Trading Day of the immediately following fiscal quarter;
(ii) if, on any Trading Day after October 15, 2019, the Closing Sale
Price of the Common Shares exceeds 120% of the then-current Conversion
Price in effect, then the Holder will be entitled to convert such Notes at
all times thereafter;
(iii) if, at any time on or before October 15, 2019, the Trading
Price per $1,000 principal amount of Notes for each Trading Day of any
five consecutive Trading Day period is less than 98% of the product of the
Closing Sale Price of the Common Shares and the Conversion Rate then in
effect, then the Holder will be entitled to convert such Notes until the
close of business on the fifth Trading Day immediately following the
conclusion of any such five consecutive Trading Day period;
(iv) if the Issuer calls a Holder's Notes for redemption, the Holder
thereof will be entitled to convert such Notes from the date of the notice
of Redemption until the close of business on the Trading Day immediately
preceding
A-6
to the Optional Redemption Date, after which time such Holder's right to
convert will expire unless the Issuer defaults in the payment of the
Conversion Price;
(v) if the Company distributes to all Holders, rights, options or
warrants entitling them to purchase Common Shares at a price less than the
average Closing Sale Price of the Common Shares for the ten Trading Days
ending on the Trading Day immediately preceding the declaration date for
such distribution and the Holder will not otherwise participate in such
distribution as a result of holding the Notes, then the Holder will be
entitled to convert such Notes until the earlier of the close of business
on the Trading Day immediately preceding the Ex-Dividend Date for such
distribution and the Trading Day immediately preceding any public
announcement by the Issuer that such distribution will not take place;
(vi) if the Company distributes to all holders of Common Shares,
cash or other assets, debt securities or rights to purchase securities of
the Company, which distribution has a per Common Share value exceeding 5%
of the Closing Sale Price of the Common Shares on the Trading Day
immediately preceding the declaration date for such distribution and the
Holder will not otherwise participate in such distribution as a result of
holding Notes, then the Holder will be entitled to convert such Notes
until the earlier of the close of business on the Trading Day immediately
prior to the Ex-Dividend Date for such distribution and the Trading Day
immediately prior to any public announcement by the Issuer that such
distribution will not take place; and
(vii) if a Designated Event occurs, then the Holder will be entitled
to convert such Notes beginning 15 calendar days prior to the date
announced by the Issuer or the Company as the anticipated effective date
of the transaction until and including the date which is 15 days after the
actual effective date of the transaction and, under certain circumstances,
the Holder will be entitled to a Make Whole Premium as set forth in the
Indenture.
The initial conversion rate is 86.9565 Common Shares per $1,000 principal
amount of Notes (subject to adjustment in the event of certain
circumstances as specified in the Indenture, the "CONVERSION RATE"), or an
effective initial conversion price of approximately $11.50 per share
(subject to adjustment in the event of certain circumstances as specified
in the Indenture, the "CONVERSION PRICE").
Upon conversion, at the option of the Issuer, the Issuer may, in lieu of
delivery of the Common Shares issuable upon conversion, deliver cash or a
combination of cash and Common Shares in satisfaction of its obligations
upon such conversion.
The Issuer will deliver cash in lieu of any fractional share. Upon
conversion, no payment or adjustment for any unpaid and accrued interest
and additional interest, if any, on the Notes will be made, except in
certain circumstances as specified in the Indenture. If a Holder
surrenders a Note for conversion after the record date
A-7
for the payment of interest but prior to the corresponding interest
payment date, such Note, when surrendered for conversion, must be
accompanied by payment of an amount equal to the interest and additional
interest, if any, thereon which has accrued and will accrue and be paid on
the Notes being converted on the corresponding interest payment date,
unless (1) the Notes have been called for redemption as described in the
Indenture, (2) the Notes have been converted in connection with a
Designated Event as described in the Indenture, or (3) if overdue
interest, if any, exists at the time of conversion with respect to such
Note.
To convert a Note, a Holder must (1) complete and sign the Conversion
Notice, with appropriate signature guarantee, on the back of the Note, (2)
surrender the Note to the Conversion Agent, (3) furnish appropriate
endorsements and transfer documents if required by the Registrar or
Conversion Agent, (4) pay funds equal to the interest payable on the next
interest payment date to which such Holder is not entitled (as provided in
the last sentence of the above paragraph) and (5) pay any transfer or
similar tax if required. A Holder may convert a portion of a Note if the
portion is $1,000 principal amount or a positive integral multiple of
$1,000 principal amount.
Any shares issued upon conversion of a Note shall bear the Restrictive
Securities Legend until after the second anniversary of the later of the
issue date for the Notes, the date in which the Issuer determines
otherwise in accordance with applicable law, or the last date on which the
Issuer, the Company or any of their respective affiliates was the owner of
such shares or the Note (or any predecessor notes) from which such shares
were converted (or such shorter period of time).
10. SUBORDINATION. The Notes are subordinated in right of payment, in the
manner and to the extent set forth in the Indenture, to the prior payment
in full of all Senior Debt. Each Holder by accepting a Note agrees to such
subordination and authorizes the Trustee to give it effect.
11. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 principal amount and positive
integral multiples of $1,000 principal amount. The transfer of Notes may
be registered and Notes may be exchanged as provided in the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Registrar need not exchange or
register the transfer of any Note selected for redemption in whole or in
part, except the unredeemed portion of Notes to be redeemed in part. Also,
it need not exchange or register the transfer of any Notes for a period of
15 days before the mailing of a notice of redemption of the Notes selected
to be redeemed and in certain other circumstances provided in the
Indenture.
A-8
12. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as
the owner of such Note for all purposes.
13. MERGER OR CONSOLIDATION. The Issuer and the Company shall not consolidate
with or merge with or into, or convey, transfer or lease all or
substantially all of their assets, whether in a single transaction or
series of related transactions to any person unless (i) the Issuer or
Company is the resulting Successor Company or the Successor Company is a
corporation organized under the laws of the United States, any State
thereof or the District of Columbia and such Successor Company assumes by
supplemental indenture, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all of the Issuer's and the Company's
obligations under the Indenture and the Notes, including the conversion
rights and, in the event that the Public Entity is required to assume the
Company's obligations under the Guarantee, the Public Entity shall assume
the obligations of the Company under that certain Contribution Agreement
or any successor agreement on similar terms as the Contribution Agreement;
(ii) immediately after giving effect to the transaction, no Default or
Event of Default shall exist; and (iii) the Issuer and the Company deliver
to the Trustee an Officers' Certificate and an Opinion of Counsel, each
stating that such consolidation, merger or transfer and such supplemental
indenture, if any, comply with the Indenture and the Notes.
14. AMENDMENTS, SUPPLEMENTS AND WAIVERS. Subject to certain exceptions, the
Indenture or the Notes may be modified or amended with the consent or vote
of the Holders of at least a majority in aggregate principal amount of the
Notes then outstanding, and any existing Default or Event of Default may
be waived with the consent or vote of the Holders of a majority in
aggregate principal amount of the Notes then outstanding. Without notice
to or the consent of any Holder, the Indenture or the Notes may be
modified or amended to cure any ambiguity or inconsistency, to comply with
Sections 7.1 and 14.11 of the Indenture, to make any changes or
modifications to the Indenture necessary in connection with the
registration of the Notes under the Securities Act and the qualification
of the Indenture under the TIA, to secure the obligations of the Issuer in
respect of the Notes, or to add to covenants of the Issuer or the Company
described in the Indenture for the benefit of Holders or to surrender any
right or power conferred upon the Issuer.
15. DEFAULTS AND REMEDIES. An Event of Default includes the occurrence of any
of the following: default in payment of principal and premium, if any, at
maturity, upon redemption or exercise of a repurchase right or otherwise;
default for 30 days in payment of interest or other amounts due; failure
by the Issuer or the Company for 60 days after notice to it to comply with
any of its other agreements in the Indenture or the Notes; certain payment
defaults or the acceleration of other indebtedness of the Issuer or its
subsidiaries; certain events of bankruptcy or insolvency involving the
Issuer, the Company or any of the Company's subsidiaries; and failure by
the Issuer to provide timely notice of the occurrence of a Designated
Event. If any Event of Default occurs and is continuing, the Trustee or
the Holders of at least 25% in aggregate principal amount of the Notes
A-9
then outstanding may declare all the Notes to be due and payable
immediately, except as provided in the Indenture. If an Event of Default
specified in Sections 5.1(e) or (f) of the Indenture with respect to the
Issuer or the Company occurs, the principal of and accrued interest on all
the Notes shall become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder. Holders
may not enforce the Indenture or the Notes except as provided in the
Indenture. The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Notes. Subject to certain limitations,
Holders of a majority in principal amount of the Notes then outstanding
may direct the Trustee in its exercise of any trust or power. The Trustee
may withhold from Holders notice of any continuing Default or Event of
Default (except a Default or Event of Default in payment) if it determines
that withholding notice is in the interests of the Holders. The Issuer and
the Company must furnish an annual compliance certificate to the Trustee.
16. REGISTRATION RIGHTS. The Holders are entitled to registration rights as
set forth in a Registration Rights Agreement (as defined in the
Indenture). The Holders shall be entitled to receive liquidated damages in
certain circumstances, all as set forth in the Registration Rights
Agreement.
17. TRUSTEE DEALINGS WITH THE ISSUER. The Trustee under the Indenture, or any
banking institution serving as successor Trustee thereunder, in its
individual or any other capacity, may make loans to, accept deposits from,
and perform services for the Issuer or its Affiliates, and may otherwise
deal with the Issuer or its Affiliates, as if it were not Trustee.
18. NO RECOURSE AGAINST OTHERS. No past, present or future director, officer,
employee or stockholder, as such, of the Company shall have any liability
for any obligations of the Issuer under the Notes or the Indenture or for
any claim based on, in respect of or by reason of such obligations or
their creation. Each Holder by accepting a Note waives and releases all
such liability. The waiver and release are part of the consideration for
the issue of the Notes.
19. AUTHENTICATION. This Notes shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent.
20. ABBREVIATIONS. Customary abbreviations may be used in the name of a Holder
or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants
by the entirety), JT TEN (= joint tenants with right of survivorship and
not as tenants in common), CUST (= Custodian), and U/G/M/A (Uniform Gifts
to Minors Act).
A-10
THE COMPANY WILL FURNISH TO ANY HOLDER UPON WRITTEN REQUEST AND
WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO:
Lions Gate Entertainment Corp.
Lions Gate Entertainment Inc.
2700 Colorado Blvd., Suite 200
Santa Monica, CA 90404
Facsimile:
Attention: Chief Financial Officer
A-11
[FORM OF ASSIGNMENT]
I or we assign to
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
- ---------------------------------------------------------
(please print or type name and address)
- -----------------------------------------------------------------------------
- -----------------------------------------------------------------------------
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints
Attorney to transfer the Note on the books of the Issuer with full power of
substitution in the premises.
Dated:
------------------------------- ----------------------------------------
NOTICE: The signature on this assignment
must correspond with the name as it
appears upon the face of the within Note
in every particular without alteration
or enlargement or any change whatsoever
and be guaranteed by a guarantor
institution participating in the
Securities Transfer Agents Medallion
Program or in such other guarantee
program acceptable to the Trustee.
Signature Guarantee:
------------------------------------------------------------
In connection with any transfer of this Note occurring prior to the
date which is the earlier of (i) the date of the declaration by the SEC of the
effectiveness of a registration statement under the Securities Act of 1933, as
amended (the "Securities Act") covering resales of this Note (which
effectiveness shall not have been suspended or terminated at the date of the
transfer) and (ii) the Resale Restriction Termination Date, the undersigned
confirms that it has not utilized any general solicitation or general
advertising in connection with transfer:
[Check One]
(1) ____ to the Issuer, the Company or any of their respective subsidiaries;
or
(2) ____ pursuant to and in compliance with Rule 144A under the Securities Act
of 1933, as amended; or
(3) ____ pursuant to the exemption from registration provided by Rule 144
under the Securities Act of 1933, as amended; or
(4) ____ pursuant to an effective registration statement under the Securities
Act of 1933, as amended.
and unless the box below is checked, the undersigned confirms that such Security
is not being transferred to an "affiliate" of the Issuer or the Company as
defined in Rule 144 under the Securities Act of 1933, as amended (an
"Affiliate"):
A-12
[ ] The transferee is an Affiliate of the Issuer or the Company. (If
the Note is transferred to an Affiliate, the restrictive legend must remain on
the Note for two years following the date of the transfer).
Unless one of the items is checked, the Trustee will refuse to
register any of the Notes evidenced by this certificate in the name of any
person other than the registered Holder thereof; provided, however, that if item
(3) or (4) is checked, the Issuer or the Trustee may require, prior to
registering any such transfer of the Notes, in their sole discretion, such
written legal opinions, certifications and other information as the Trustee or
the Issuer have 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, as amended.
If none of the foregoing items are checked, the Trustee or Registrar
shall not be obligated to register this Note in the name of any person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.16 of the Indenture shall have
been satisfied.
Dated: Signed:
------------------------------ ---------------------------------
(Sign exactly as name appears on
the other side of this Note)
Signature Guarantee:
------------------------------------------------------------
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Note 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, as amended, 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
Issuer and the Company as the undersigned has requested pursuant to Rule 144A or
has determined 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
A-13
CONVERSION NOTICE
To convert this Note into Common Shares of the Company, check the box: [ ]
To convert only part of this Note, state the principal amount to be converted
(must be in multiples of $1,000):
$__________________
If you want the share certificate made out in another person's name, fill in the
form below:
- --------------------------------------------------------------------------------
(Insert other person's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type other person's name, address and zip code)
- --------------------------------------------------------------------------------
Date:______________ Signature(s):
-------------------------------------------
-------------------------------------------
(Sign exactly as your name(s) appear(s) on
the other side of this Note)
Signature(s) guaranteed by:
-----------------------------------------------------
(All signatures must be guaranteed by a guarantor institution
participating in the Securities Transfer Agents Medallion Program or in
such other guarantee program acceptable to the Trustee.)
A-14
SCHEDULE A
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE(1) .
The following exchanges of a part of this Global Notes for an interest in
another Global Note or for Notes in certificated form, have been made:
Principal amount of
this Global Signature or
Amount of decrease Amount of increase in Note following authorized signatory
in Principal amount Principal amount of such decrease of Trustee or Note
Date of Exchange of this Global Note this Global Note (or increase) Custodian
- ----------
1 This is included in Global Notes only.
A-15
EXHIBIT B-1
RESTRICTIVE SECURITIES LEGEND FOR NOTES
"THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS NOTE AND THE COMMON SHARES OF
LIONS GATES ENTERTAINMENT CORP. ISSUABLE UPON CONVERSION HEREOF MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED
THAT THE SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS
OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A OR REGULATION S
THEREUNDER.
THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS NOTE AND THE COMMON SHARES OF LIONS GATES ENTERTAINMENT CORP. ISSUABLE
UPON CONVERSION HEREOF MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED,
ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), OR (IV) PURSUANT
TO AN EFFECTIVE REGISTRATION UNDER THE SECURITIES ACT, IN EACH OF CASES (I)
THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE. IN ANY CASE THE HOLDER HEREOF WILL NOT,
DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THE
SECURITIES EXCEPT AS PERMITTED BY THE SECURITIES ACT.
THIS NOTE, ANY COMMON SHARES OF LIONS GATES ENTERTAINMENT CORP.
ISSUABLE UPON CONVERSION HEREOF AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR
SUPPLEMENTED FROM TIME TO TIME TO MODIFY THE RESTRICTIONS ON RESALES AND OTHER
TRANSFERS OF THIS NOTE AND ANY SUCH SHARES TO REFLECT ANY CHANGE IN APPLICABLE
LAW OR REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO
THE RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS
NOTE AND SUCH SHARES SHALL BE DEEMED BY THE ACCEPTANCE OF THIS NOTE AND ANY SUCH
SHARES TO HAVE AGREED TO SUCH AMENDMENT OR SUPPLEMENT.
B-1-1
THIS NOTE IS SUBJECT TO THE TERMS OF AN OPTIONAL REDEMPTION PURSUANT
TO WHICH THE ISSUER MAY REDEEM THE NOTE AT ANY TIME ON OR AFTER OCTOBER 15, 2009
AT SPECIFIED REDEMPTION PRICES. THIS NOTE IS ALSO SUBJECT TO REPURCHASE AT THE
OPTION OF THE HOLDER PURSUANT TO WHICH THE ISSUER MAY BE OBLIGATED TO REPURCHASE
THIS NOTE ON SPECIFIED DATES OR UPON THE OCCURRENCE OF CERTAIN DESIGNATED
EVENTS. THE OPTIONAL REDEMPTION AND REPURCHASES AT THE OPTION OF THE HOLDER ARE
MORE FULLY DESCRIBED IN THE OFFERING CIRCULAR DATED SEPTEMBER 29, 2004, A COPY
OF WHICH IS AVAILABLE FROM THE ISSUER UPON REQUEST."
B-1-2
EXHIBIT B-2
RESTRICTIVE SECURITIES LEGEND FOR COMMON SHARES
"THIS SECURITY EVIDENCED HEREBY (OR ITS PREDECESSOR) WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE COMMON SHARES
REPRESENTED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER HEREOF IS HEREBY NOTIFIED THAT THE SELLER HEREOF MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A OR REGULATION S THEREUNDER.
THE HOLDER OF THIS CERTIFICATE AGREES FOR THE BENEFIT OF THE COMPANY
THAT (A) THE COMMON SHARES REPRESENTED HEREBY MAY BE OFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY (I) IN THE UNITED STATES TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (II) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH RULE 904 UNDER THE SECURITIES ACT, (III) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE), OR (IV) PURSUANT TO AN EFFECTIVE REGISTRATION UNDER THE SECURITIES
ACT, IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND
EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THE SECURITIES
REPRESENTED HEREBY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
IN ANY CASE THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY
HEDGING TRANSACTION WITH REGARD TO THE SECURITIES EXCEPT AS PERMITTED BY THE
SECURITIES ACT.
THIS CERTIFICATE AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR
SUPPLEMENTED FROM TIME TO TIME TO MODIFY THE RESTRICTIONS ON RESALES AND OTHER
TRANSFERS OF THE SECURITIES REPRESENTED HEREBY TO REFLECT ANY CHANGE IN
APPLICABLE LAW OR REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES
RELATING TO THE RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE
HOLDER OF THIS CERTIFICATE SHALL BE DEEMED BY THE ACCEPTANCE HEREOF TO HAVE
AGREED TO SUCH AMENDMENT OR SUPPLEMENT."
B-2-1
EXHIBIT B-3
GLOBAL NOTE LEGEND
"THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY
OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR
A SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY
BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY ("DTC"), A NEW YORK CORPORATION, TO THE ISSUER
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 PERSONS IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
B-3-1
EXHIBIT C
FORM OF NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT
LIONS GATE ENTERTAINMENT INC.
LIONS GATE ENTERTAINMENT CORP.
2700 Colorado Avenue, Suite 200
Santa Monica, California 90404
J.P. MORGAN TRUST COMPANY,
NATIONAL ASSOCIATION
560 Mission Street, 13th Floor
San Francisco, CA 94105
Attention:
Re: LIONS GATE ENTERTAINMENT INC. (the "ISSUER") 2.9375% Convertible
Senior Subordinated Notes due 2024 (the "NOTES")
Ladies and Gentlemen:
Please be advised that _____________ has transferred $___________
aggregate principal amount of the Notes or __ Common Shares, no par value per
share, of the Issuer issuable on conversion of the Notes ("COMMON SHARES")
pursuant to an effective Shelf Registration Statement on Form S-3 (File No.
333-________).
We hereby certify that the prospectus delivery requirements, if any, of
the Securities Act of 1933 as amended, have been satisfied with respect to the
transfer described above and that the above-named beneficial owner of the Notes
or Common Shares is named as a "SELLING SECURITY HOLDER" in the Prospectus dated
_________, or in amendments or supplements thereto, and that the aggregate
principal amount of the Notes, or number of Common Shares transferred are [a
portion of] the Notes or Common Shares listed in such Prospectus, as amended or
supplemented, opposite such owner's name.
Very truly yours,
-------------------------
(Name)
C-1
EXHIBIT D
FORM OF OPINION OF COUNSEL IN CONNECTION WITH
REGISTRATION OF SECURITIES
[Name]
[Address]
Re: LIONS GATE ENTERTAINMENT INC. (the "ISSUER") 2.9375% Convertible
Senior Subordinated Notes due 2024 (the "NOTES")
Ladies and Gentlemen:
Reference is made to the Notes issued pursuant to a certain
indenture dated as of October 4, 2004 by and among the Issuer, the Company and
J.P. Morgan Trust Company, National Association, as trustee (the "TRUSTEE"). The
Company issued $150,000,000 principal amount of Notes on October 4, 2004
(including an additional $25,000,000 pursuant to the exercise on September 29,
2004 of the initial purchasers' over-allotment option) in transactions exempt
from registration under the Securities Act of 1933, as amended (the "SECURITIES
ACT"). The Issuer and the Company have filed with the Securities and Exchange
Commission (the "SEC") a registration statement on Form S-3 (File No. 333-____)
(the "REGISTRATION STATEMENT") relating to the registration under the Securities
Act of $______________ principal amount of the Notes and the Common Shares of
the Company (the "SHARES") issuable upon conversion of the Notes being
registered. The Registration Statement was declared effective by order of the
SEC dated [_____________].
We have acted as counsel for the Issuer and the Company in
connection with the issuance of the Notes and the preparation and filing of the
Registration Statement and are familiar with the Securities, the Indenture, the
Registration Statement, the above-mentioned SEC order and such other documents
as are necessary to render this opinion.
Based on the foregoing, it is our opinion that (1) the Registration
Statement has become effective under the Securities Act and, to our knowledge,
no stop order suspending the effectiveness of the Registration Statement has
been issued, (2) assuming that the Notes covered by the Registration Statement
and the Common Shares issuable upon conversion of such Notes are sold by a
relevant Holder specified in the Registration Statement in a manner specified in
the Registration Statement, such sale of the Notes and Common Shares issuable
upon conversion of the Notes will have been duly registered under the Securities
Act and (3) the Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended.
Yours truly,
D-1
EXHIBIT E
FORM OF NOTE GUARANTEE
For value received, the undersigned hereby unconditionally
guarantees, as principal obligor and not only as a surety, to the Holder of this
Note the cash payments in United States dollars of principal of, premium, if
any, and interest on this Note (and including Additional Interest payable
thereon) in the amounts and at the times when due and interest on the overdue
principal, premium, if any, and interest, if any, of this Note, if lawful, and
the payment or performance of all other Obligations of the Company under the
Indenture (as defined below) or the Note, to the Holder of this Note and the
Trustee, all in accordance with and subject to the terms and limitations of this
Note, Article III of the Indenture, the subordination provisions of Article XV
of the Indenture and this Guarantee. This Guarantee will become effective in
accordance with Article XV of the Indenture and its terms shall be evidenced
therein. The validity and enforceability of this Guarantee shall not be affected
by the fact that it is not affixed to any particular Note. Capitalized terms
used but not defined herein shall have the meanings ascribed to them in the
Indenture dated as of October 4, 2004, among Lions Gate Entertainment Inc., a
Delaware corporation, as issuer (the "Company"), Lions Gate Entertainment Corp,
a British Columbia corporation, as guarantor (the "Guarantor") and J.P. Morgan
Trust Company, National Association, as trustee (the "Trustee") (as amended or
supplemented, the "Indenture").
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK BUT WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAW OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY. The Guarantor hereby agrees to
submit to the jurisdiction of the courts of the State of New York in any action
or proceeding arising out of or relating to this Guarantee.
This Guarantee is subject to release upon the terms set forth in the
Indenture.
Date: October ________, 2004
LIONS GATE ENTERTAINMENT CORP.
By:
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Name:
Title:
E-1