EXHIBIT 4.4
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Dave & Buster's, Inc., Issuer
THE BANK OF NEW YORK,
as Trustee
INDENTURE
Dated as of August 7, 2003
5.0% Convertible Subordinated Notes due 2008
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CROSS-REFERENCE SHEET*
Provisions of Trust Indenture Act of 1939 and Indenture, dated as of
August 7, 2003, between Dave & Buster's, Inc. and The Bank of New York, as
Trustee, providing for the 5.0% Convertible Subordinated Notes due 2008:
<Table>
<Caption>
Section of the Act Section of Indenture
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310(a)(1) and (2)...................................... 8.9
310(a)(3) and (4)...................................... N.A.**
310(b)................................................. 8.8 and 8.10(b) and (d)
310(c)................................................. N.A.
311(a)................................................. 8.13
311(b)................................................. 8.13
311(c)................................................. N.A.
312(a)................................................. 6.1 and 6.2(a)
312(b)................................................. 6.2(b)
312(c)................................................. 6.2(c)
313(a)................................................. 6.3(a)
313(b)(1).............................................. N.A.
313(b)(2).............................................. 6.3(a)
313(c)................................................. 6.3(a)
313(d)................................................. 6.3(b)
314(a)................................................. 6.4
314(b)................................................. N.A.
314(c)(1) and (2)...................................... 17.5
314(c)(3).............................................. N.A.
314(d)................................................. N.A.
314(e)................................................. 17.5
314(f)................................................. N.A.
315(a), (c) and (d).................................... 8.1
315(b)................................................. 7.8
315(e)................................................. 7.9
316(a)(1).............................................. 7.7
316(a)(2).............................................. Not required
316(a) (last sentence)................................. 9.4
316(b)................................................. 11.2
</Table>
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* This Cross-Reference Table shall not, for any purpose, be deemed a part of
this Indenture.
** N.A. means Not Applicable.
TABLE OF CONTENTS
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<Caption>
PAGE
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ARTICLE I DEFINITIONS................................................................................................. 1
Section 1.1 Definitions................................................................................ 1
Section 1.2 Other Definitions.......................................................................... 8
Section 1.3 Rules of Construction...................................................................... 9
ARTICLE II ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES......................................... 10
Section 2.1 Designation, Amount and Issue of Notes.................................................... 10
Section 2.2 Form of Notes............................................................................. 10
Section 2.3 Date and Denomination of Notes; Payments of Interest...................................... 11
Section 2.4 Execution of Notes........................................................................ 12
Section 2.5 Exchange and Registration of Transfer of Notes; Restrictions on Transfer.................. 13
Section 2.6 Mutilated, Destroyed, Lost or Stolen Notes................................................ 26
Section 2.7 Temporary Notes........................................................................... 27
Section 2.8 Cancellation of Notes Paid, Etc........................................................... 27
Section 2.9 CUSIP Numbers............................................................................. 28
ARTICLE III OPTIONAL REDEMPTION OF NOTES............................................................................. 28
Section 3.1 Redemption Price.......................................................................... 28
Section 3.2 Notice of Redemption; Selection of Notes.................................................. 28
Section 3.3 Payment of Notes Called for Redemption.................................................... 29
Section 3.4 Conversion Arrangement on Call for Redemption............................................. 30
ARTICLE IV SUBORDINATION............................................................................................. 31
Section 4.1 Subordination to Senior Indebtedness...................................................... 31
Section 4.2 No Payment if Default in Senior Indebtedness.............................................. 32
Section 4.3 Payment upon Dissolution, Etc............................................................. 33
Section 4.4 Payments on Notes......................................................................... 34
Section 4.5 Certain Conversions Deemed Payment........................................................ 34
Section 4.6 Subrogation............................................................................... 35
Section 4.7 Rights of Holders Unimpaired.............................................................. 35
Section 4.8 Holders of Senior Indebtedness............................................................ 35
Section 4.9 Trustee Not Fiduciary for Holders of Senior Indebtedness.................................. 35
Section 4.10 Rights of Trustee as Holder of Senior Indebtedness; Preservation of Trustee's
Rights.................................................................................... 36
Section 4.11 Proceeds Held in Trust.................................................................... 36
Section 4.12 Blockage of Remedies...................................................................... 36
Section 4.13 Prior Notice of Acceleration.............................................................. 36
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<Table>
ARTICLE V PARTICULAR COVENANTS OF THE COMPANY........................................................................ 37
Section 5.1 Payment of Principal, Premium and Interest................................................ 37
Section 5.2 Maintenance of Office or Agency........................................................... 37
Section 5.3 Appointments to Fill Vacancies in Trustee's Office........................................ 38
Section 5.4 Provisions as to Paying Agent............................................................. 38
Section 5.5 Existence................................................................................. 39
Section 5.6 Information Requirement................................................................... 39
Section 5.7 Stay, Extension and Usury Laws............................................................ 39
Section 5.8 Compliance Certificate.................................................................... 40
Section 5.9 Further Instruments and Acts.............................................................. 40
Section 5.10 Leverage Ratio Incurrence Test............................................................ 40
Section 5.11 Cash Distributions........................................................................ 40
ARTICLE VI NOTEHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE............................................. 41
Section 6.1 Noteholders Lists......................................................................... 41
Section 6.2 Preservation and Disclosure of Lists...................................................... 41
Section 6.3 Reports by Trustee........................................................................ 41
Section 6.4 Reports by Company........................................................................ 42
ARTICLE VII DEFAULTS AND REMEDIES.................................................................................... 42
Section 7.1 Events of Default......................................................................... 42
Section 7.2 Payments of Notes on Default; Suit Therefor............................................... 45
Section 7.3 Application of Monies Collected by Trustee................................................ 47
Section 7.4 Proceedings by Noteholder................................................................. 48
Section 7.5 Proceedings by Trustee.................................................................... 48
Section 7.6 Remedies Cumulative and Continuing........................................................ 49
Section 7.7 Direction of Proceedings and Waiver of Defaults by Majority of Noteholders................ 49
Section 7.8 Notice of Defaults........................................................................ 49
Section 7.9 Undertaking to Pay Costs.................................................................. 50
Section 7.10 Delay or Omission Not Waiver.............................................................. 50
ARTICLE VIII CONCERNING THE TRUSTEE.................................................................................. 50
Section 8.1 Duties and Responsibilities of Trustee.................................................... 50
Section 8.2 Reliance on Documents, Opinions, Etc...................................................... 52
Section 8.3 No Responsibility for Recitals, Etc....................................................... 53
Section 8.4 Trustee, Paying Agents, Conversion Agents or Registrar May Own Notes...................... 53
Section 8.5 Monies to be Held in Trust................................................................ 54
Section 8.6 Compensation and Expenses of Trustee...................................................... 54
Section 8.7 Officer's Certificate as Evidence......................................................... 55
Section 8.8 Conflicting Interests of Trustee.......................................................... 55
Section 8.9 Eligibility of Trustee.................................................................... 55
Section 8.10 Resignation or Removal of Trustee......................................................... 55
Section 8.11 Acceptance by Successor Trustee........................................................... 57
</Table>
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<Table>
Section 8.12 Succession by Merger, Etc................................................................. 57
Section 8.13 Limitation on Rights of Trustee as Creditor............................................... 58
ARTICLE IX CONCERNING THE NOTEHOLDERS................................................................................ 58
Section 9.1 Action by Noteholders..................................................................... 58
Section 9.2 Proof of Execution by Noteholders......................................................... 58
Section 9.3 Who Are Deemed Absolute Owners............................................................ 59
Section 9.4 Company-Owned Notes Disregarded........................................................... 59
Section 9.5 Revocation of Consents; Future Holders Bound.............................................. 59
ARTICLE X NOTEHOLDERS' MEETINGS...................................................................................... 60
Section 10.1 Purpose of Meetings....................................................................... 60
Section 10.2 Call of Meetings by Trustee............................................................... 60
Section 10.3 Call of Meetings by Company or Noteholders................................................ 61
Section 10.4 Qualifications for Voting................................................................. 61
Section 10.5 Regulations............................................................................... 61
Section 10.6 Voting.................................................................................... 62
Section 10.7 No Delay of Rights by Meeting............................................................. 62
ARTICLE XI AMENDMENTS; SUPPLEMENTAL INDENTURES....................................................................... 62
Section 11.1 Amendments; Supplemental Indentures without Consent of Noteholders........................ 62
Section 11.2 Amendments; Supplemental Indentures with Consent of Noteholders........................... 64
Section 11.3 Effect of Amendments and Supplemental Indentures.......................................... 64
Section 11.4 Notation on Notes......................................................................... 65
Section 11.5 Evidence of Compliance of Amendment or Supplemental Indenture to be Furnished
to Trustee................................................................................ 65
ARTICLE XII CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE........................................................ 65
Section 12.1 Company May Consolidate, Etc.............................................................. 65
Section 12.2 Successor Entity to be Substituted........................................................ 66
Section 12.3 Opinion of Counsel to be Given Trustee.................................................... 67
ARTICLE XIII SATISFACTION AND DISCHARGE OF INDENTURE................................................................. 67
Section 13.1 Discharge of Indenture.................................................................... 67
Section 13.2 Deposited Monies to be Held in Trust by Trustee........................................... 68
Section 13.3 Paying Agent to Repay Monies Held......................................................... 68
Section 13.4 Return of Unclaimed Monies................................................................ 68
Section 13.5 Reinstatement............................................................................. 68
ARTICLE XIV NO RECOURSE AGAINST OTHERS............................................................................... 69
Section 14.1 Indenture and Notes Solely Corporate Obligations.......................................... 69
ARTICLE XV CONVERSION OF NOTES....................................................................................... 69
Section 15.1 Right to Convert.......................................................................... 69
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<Table>
Section 15.2 Exercise of Conversion Privilege; Issuance of Common Stock on Conversion.................. 70
Section 15.3 Cash Payments in Lieu of Fractional Shares................................................ 72
Section 15.4 Conversion Price.......................................................................... 72
Section 15.5 Adjustment of Conversion Price............................................................ 72
Section 15.6 Effect of Reclassification, Consolidation, Merger or Sale................................. 79
Section 15.7 Taxes on Shares Issued.................................................................... 80
Section 15.8 Reservation of Shares; Shares to be Fully Paid; Listing of Common Stock................... 80
Section 15.9 Responsibility of Trustee................................................................. 82
Section 15.10 Notice to Holders Prior to Certain Actions................................................ 82
ARTICLE XVI REPURCHASE UPON A REPURCHASE EVENT....................................................................... 83
Section 16.1 Repurchase Right.......................................................................... 83
Section 16.2 Notices; Method of Exercising Repurchase Right, Etc....................................... 84
Section 16.3 Certain Definitions....................................................................... 85
ARTICLE XVII MISCELLANEOUS PROVISIONS................................................................................ 87
Section 17.1 Provisions Binding on Company's Successors................................................ 87
Section 17.2 Official Acts by Successor Corporation.................................................... 87
Section 17.3 Addresses for Notices, Etc................................................................ 87
Section 17.4 Governing Law............................................................................. 88
Section 17.5 Evidence of Compliance with Conditions Precedent; Certificates to Trustee................. 88
Section 17.6 Legal Holidays............................................................................ 89
Section 17.7 No Security Interest Created.............................................................. 89
Section 17.8 Trust Indenture Act....................................................................... 89
Section 17.9 Benefits of Indenture..................................................................... 89
Section 17.10 Table of Contents, Headings, Etc.......................................................... 90
Section 17.11 Authenticating Agent...................................................................... 90
Section 17.12 Execution in Counterparts................................................................. 90
Section 17.13 No Adverse Interpretation of Other Agreements............................................. 91
EXHIBIT A Form of 5.0% Convertible Subordinated Note due 2008
A - Form of Conversion Notice
B - Form of Option to Elect Repayment Upon a Repurchase Event
C - Form of Certificate of Transfer
D - Form of Certificate of Exchange
E - Form of Transfer Letter of Representations
EXHIBIT B Form of Leverage Ratio Certificate
</Table>
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INDENTURE dated as of August 7, 2003 between Dave & Buster's, Inc., a
Missouri corporation (hereinafter sometimes called the "Company", as more fully
set forth in Section 1.1), and The Bank of New York, a New York banking
corporation, as trustee (hereinafter sometimes called the "Trustee", as more
fully set forth in Section 1.1).
WITNESSETH:
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the issue of its 5.0% Convertible Subordinated Notes due 2008
(hereinafter sometimes called the "Notes"), in an aggregate principal amount not
to exceed Thirty Million Dollars ($30,000,000) and to provide the terms and
conditions upon which the Notes are to be authenticated, issued and delivered,
the Company has duly authorized the execution and delivery of this Indenture;
and
WHEREAS, the Notes, the certificate of authentication to be borne by
the Notes, a form of assignment, a form of option to elect repayment upon a
Repurchase Event, and a form of conversion notice and transfer to be borne by
the Notes are to be substantially in the forms hereinafter provided for; and
WHEREAS, all acts and things necessary to make the Notes, when executed
by the Company and authenticated and delivered by the Trustee or a duly
authorized authenticating agent, as provided in this Indenture, the valid,
binding and legal obligations of the Company, and to constitute these presents a
valid agreement according to its terms, have been done and performed, and the
execution of this Indenture and the issue hereunder of the Notes have in all
respects been duly authorized.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
That in order to declare the terms and conditions upon which the Notes
are, and are to be, authenticated, issued and delivered, and in consideration of
the premises and of the purchase and acceptance of the Notes by the holders
thereof, the Company covenants and agrees with the Trustee for the equal and
proportionate benefit of the respective holders from time to time of the Notes
(except as otherwise provided below), as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions
144A Global Note: The term "144A Global Note" means a global note
substantially in the form of Exhibit A hereto bearing the Global Note Legend and
the Private Placement Legend and deposited with or on behalf of, and registered
in the name of, the Depositary or its nominee that will be issued in a
denomination equal to the outstanding principal amount of the Notes sold in
reliance on Rule 144A.
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Affiliate: The term "Affiliate" of any specified Person shall mean any
other person directly or indirectly controlling or controlled by or under direct
or indirect common control with such specified Person. For the purposes of this
definition, "control," when used with respect to any specified Person means the
power to direct or cause the direction of the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Applicable Procedures: The term "Applicable Procedures" shall mean,
with respect to any transfer or exchange of beneficial ownership interests in a
Global Note, the rules and procedures of the Depositary that are applicable to
such transfer or exchange.
Board of Directors: The term "Board of Directors" shall mean the Board
of Directors of the Company or a committee of such Board duly authorized to act
for it hereunder (to the extent permitted by applicable law).
Board Resolution: The term "Board Resolution" means a copy of a
resolution certified by the Secretary or an Assistant Secretary of the Company
to have been duly adopted by the Board of Directors, and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
Business Day: The term "Business Day" means each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which the banking
institutions in The City of New York or the city in which the Corporate Trust
Office is located are authorized or obligated by law or executive order to close
or be closed.
Close of business: The term "close of business" means 5 p.m. (New York
City time).
Commission: The term "Commission" shall mean the Securities and
Exchange Commission.
Common Stock: The term "Common Stock" shall mean any stock 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.
Subject to the provisions of Section 15.6, however, shares issuable on
conversion of Notes shall include only shares of the class designated as common
stock of the Company at the date of this Indenture or shares of any class or
classes resulting from any reclassification or reclassifications thereof and
which have no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding up of
the Company and which are not subject to redemption by the Company; provided
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: The term "Company" shall mean Dave & Buster's, Inc., a
Missouri corporation, and subject to the provisions of Article XII, shall
include its successors and assigns.
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Corporate Trust Office: The term "Corporate Trust Office," or other
similar term, shall mean the office of the Trustee at which at any particular
time its corporate trust business shall be principally administered, which
office is, at the date as of which this Indenture is dated, located at 101
Barclay Street, Floor 8W, New York, New York 10286, Attention: Corporate Trust
Administration.
Custodian: The term "Custodian" shall mean the Trustee, as custodian
with respect to the Notes in global form, or any successor entity thereto.
Default: The term "default" shall mean any event that is, or after
notice or passage of time, or both, would be, an Event of Default.
Definitive Note: The term "Definitive Note" shall mean a certificated
Note registered in the name of the holder thereof and issued in accordance with
Section 2.5, substantially in the form of Exhibit A hereto except that such Note
shall not bear the Global Note Legend and shall not have the "Schedule of
Exchanges of Interests in the Global Note" attached thereto.
Depositary: The term "Depositary" shall mean, with respect to the Notes
issuable or issued in whole or in part in global form, the Person specified in
Section 2.5(a) as the Depositary with respect to the Notes, and any and all
successors thereto appointed as depositary hereunder and having become such
pursuant to the applicable provision of this Indenture.
Designated Senior Debt: The term "Designated Senior Debt" shall mean
(i) any Senior Indebtedness consisting of indebtedness for borrowed money which,
at the time of determination, has an aggregate principal amount of at least U.S.
$2,000,000 if the instrument creating or evidencing the same or the assumption
or guarantee thereof (or related agreements or documents to which the Company or
any Subsidiary is a party) expressly provides that such indebtedness shall be
"Designated Senior Debt" for purposes of this Indenture (provided that such
instrument, agreement or other document may place limitations and conditions on
the right of the holders of such Senior Indebtedness to exercise the rights of
holders of Designated Senior Debt) and (ii) the Senior Credit Facility. If any
payment made to any holder of any Designated Senior Debt with respect to such
Designated Senior Debt is rescinded or must otherwise be returned by such holder
upon the insolvency, bankruptcy or reorganization of the Company or any
Subsidiary or otherwise, the reinstated indebtedness of the Company or such
subsidiary arising as a result of such rescission or return shall constitute
Designated Senior Debt effective as of the date of such rescission or return.
EBITDA: The term "EBITDA" shall mean for any fiscal period, as
applicable, of the Company, the sum of operating income of the Company and its
Subsidiaries on a consolidated basis, plus depreciation and amortization expense
deducted therefrom, as calculated by the Company's chief financial officer
consistent with the information presented in the financial statements of the
Company filed with the Commission pursuant to Section 13 or 15(d), or provided
to the Trustee in accordance with Section 6.4(b) hereof.
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Equity Interests: The term "Equity Interests" shall mean capital stock
or warrants, options or other rights to acquire capital stock (but excluding any
debt security which is convertible into, or exchangeable for, capital stock).
Event of Default: The term "Event of Default" shall mean any event
specified in Section 7.1, continued for the period of time, if any, and after
the giving of notice, if any, therein designated.
Exchange Act: The term "Exchange Act" means the Securities Exchange Act
of 1934, as amended, and the rules and regulations promulgated thereunder.
Global Notes: The term "Global Notes" shall mean, individually and
collectively, each of the Restricted Global Notes and the Unrestricted Global
Notes, issued in accordance with Section 2.2, 2.5(c)(iv) or 2.5(e)(ii).
Global Note Legend: The term "Global Note Legend" shall mean the legend
set forth in Section 2.5(h)(iii), which is required to be placed on all Global
Notes issued under this Indenture.
IAI Global Note: The term "IAI Global Note" shall mean the Global Note
substantially in the form of Exhibit A hereto bearing the Global Note Legend and
the Private Placement Legend and deposited with or on behalf of and registered
in the name of the Depositary or its nominee that shall be issued in a
denomination equal to the outstanding principal amount of the Notes held by
Institutional Accredited Investors.
Indenture: The term "Indenture" shall mean this instrument as
originally executed or, if amended or supplemented as herein provided, as so
amended or supplemented.
Individual Accredited Investor: The term "Individual Accredited
Investor" shall mean an individual "accredited investor" as defined in Rule
501(a) (5) or (6) of Regulation D under the Securities Act.
Indirect Participant: The term "Indirect Participant" shall mean a
Person who holds a beneficial interest in a Global Note through a Participant.
Institutional Accredited Investor: The term "Institutional Accredited
Investor" shall mean an institutional "accredited investor" as such term is
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act or any
entity in which all of the equity owners are accredited investors within the
meaning of Rule 501(a)(1), (2), (3), (5), (6) or (7) under the Securities Act.
Leverage Ratio: The term "Leverage Ratio" shall mean the ratio of (i)
LR Indebtedness to (ii) EBITDA for the prior four (4) fiscal quarters.
Liquidated Damages: The term "Liquidated Damages" means all liquidated
damages then owing pursuant to Section 2(f) of the Registration Rights Agreement
and Section 15.2.
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LR Indebtedness: The term "LR Indebtedness" means the total (without
duplication) of the (i) LR Senior Indebtedness, plus (ii) indebtedness of the
Company evidenced by the Notes, plus (iii) any indebtedness of the Company or
any Subsidiary secured by a mortgage, pledge, security interest, lien or
encumbrance affecting title to any of the Company's or such Subsidiary's assets
plus (iv) any indebtedness of the Company of any Subsidiary which by its terms
shall rank equally and ratably with the Notes in right of payment, but excluding
any of the items excluded from the definition of LR Senior Indebtedness by
reference to sub-sections (iii), (iv) and (v) of Section 4.1 and any obligations
of the Company or any Subsidiary as lessee under leases of real property.
LR Senior Indebtedness: The term "LR Senior Indebtedness" means Senior
Indebtedness as defined in Section 4.1 hereof, but excluding the following
sub-sections of Section 4.1: (iii) all obligations of the Company or any
Subsidiary under any interest or currency swap agreements, hedging agreements,
cap, floor and collar agreements, spot and forward contracts and other similar
agreements, (iv) obligations in respect of letters of credit, bank guarantees
and bankers acceptances, (v) obligations of the Company or any Subsidiary as
lessee under leases of personal property (whether or not required to be
capitalized under GAAP).
Note or Notes: The terms "Note" or "Notes" shall mean any Note or
Notes, as the case may be, authenticated and delivered under this Indenture.
Noteholder or holder: The terms "Noteholder" or "holder" as applied to
any Note, or other similar terms (but excluding the term "beneficial holder"),
shall mean any Person in whose name at the time a particular Note is registered
on the Note register.
Officer's Certificate: The term "Officer's Certificate", when used with
respect to the Company, shall mean a certificate signed by one of the President,
the Chief Executive Officer, Chief Financial Officer, Executive or Senior Vice
President or any Vice President, that is delivered to the Trustee. Each such
certificate shall include the statements provided for in Section 17.5 if and to
the extent required by the provisions of such Section.
Opinion of Counsel: The term "Opinion of Counsel" shall mean an opinion
in writing signed by legal counsel, who may be an employee of or counsel to the
Company, which is delivered to the Trustee. Each such opinion shall include the
statements provided for in Section 17.5 if and to the extent required by the
provisions of such Section.
Outstanding: The term "outstanding," when used with reference to Notes,
shall, subject to the provisions of Section 9.4, mean, as of any particular
time, all Notes authenticated and delivered by the Trustee under this Indenture,
except:
(a) Notes theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(b) Notes, or portions thereof, for the payment, or redemption
of which monies in the necessary amount shall have been deposited in
trust with the Trustee or with any paying agent (other than the
Company) or shall have been set aside and segregated in trust by the
Company (if the Company shall act as its own paying agent); provided
that if
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such Notes are to be redeemed, as the case may be, prior to the
maturity thereof, notice of such redemption shall have been given as
provided in Section 3.2, or provision satisfactory to the Trustee shall
have been made for giving such notice;
(c) Notes paid pursuant to Section 2.6 and Notes in lieu of
which, or in substitution for which, other Notes shall have been
authenticated and delivered pursuant to the terms of Section 2.6 unless
proof satisfactory to the Trustee is presented that any such Notes are
held by bona fide holders in due course; and
(d) Notes converted into Common Stock pursuant to Article XV
and Notes deemed not outstanding pursuant to Section 3.2.
Participant: The term "Participant" shall mean, with respect to the
Depositary, a Person who has an account with the Depositary.
Person: The term "Person" shall mean an individual, a corporation, a
limited liability company, an association, a partnership, a joint venture, a
joint stock company, a trust, an unincorporated organization or a government or
an agency or a political subdivision thereof.
Predecessor Note: The term "Predecessor Note" of any particular Note
shall mean 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 2.6 in lieu of a
lost, destroyed or stolen Note shall be deemed to evidence the same debt as the
lost, destroyed or stolen Note that it replaces.
Private Placement Legend: The term "Private Placement Legend" shall
mean the legend set forth in Section 2.5(h)(i) to be placed on all Notes issued
under this Indenture except where otherwise permitted by the provisions of this
Indenture.
QIB: The term "QIB" shall mean a "qualified institutional buyer" as
defined in Rule 144A.
Registration Rights Agreement: The term "Registration Rights Agreement"
means that certain Registration Rights Agreement, dated as of August 6, 2003,
among the Company and the initial purchasers of the Notes and Warrants, as such
agreement may be amended from time to time.
Representative: The term "Representative" shall mean (a) the indenture
trustee or other trustee, agent or representative for holders of Senior
Indebtedness or (b) with respect to any Senior Indebtedness that does not have
any trustee, agent or other representative, (i) in the case of such Senior
Indebtedness issued pursuant to an agreement providing for voting arrangements
as among the holders or owners of such Senior Indebtedness, any holder or owner
of such Senior Indebtedness acting with the consent of the required persons
necessary to bind such holders or owners of such Senior Indebtedness and (ii) in
the case of all other such Senior Indebtedness, the holder or owner of such
Senior Indebtedness.
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Responsible Officer: The term "Responsible Officer" shall mean, when
used with respect to the Trustee, any officer within the corporate trust
department of the Trustee, including any vice president, assistant vice
president, assistant secretary, assistant treasurer, trust officer or any other
officer of the Trustee who customarily performs functions similar to those
performed by the Persons who at the time shall be such officers, respectively,
or to whom any corporate trust matter is referred because of such person's
knowledge of and familiarity with the particular subject and who shall have
direct responsibility for the administration of this Indenture.
Restricted Definitive Note: The term " Restricted Definitive Note"
means a Definitive Note bearing the Private Placement Legend.
Restricted Global Note: The term "Restricted Global Note" shall mean a
permanent Global Note substantially in the form of Exhibit A attached hereto
that bears the Global Note Legend and that has the "Schedule of Exchanges of
Interests in the Global Note" attached thereto, and that is deposited with or on
behalf of and registered in the name of the Depositary, representing a series of
Notes that bear the Private Placement Legend.
Rule 144: The term "Rule 144" shall mean Rule 144 promulgated under the
Securities Act.
Rule 144A: The term "Rule 144A" shall mean Rule 144A promulgated under
the Securities Act.
Securities Act: The term "Securities Act" means the Securities Act of
1933, as amended, and the rules and regulations promulgated thereunder.
Securities Purchase Agreement: The term "Securities Purchase Agreement"
means that certain Securities Purchase Agreement, dated as of August 6, 2003,
among the Company and the parties listed on the Schedule of Buyers attached
thereto as Exhibit A, as such agreement may be amended from time to time.
Senior Credit Facility: The term "Senior Credit Facility" means the
senior credit facility under that certain Revolving Credit and Term Loan
Agreement dated as of June 30, 2000, among Dave & Buster's, Inc. and certain of
its subsidiaries as joint and several borrowers and Fleet National Bank as
lender and administrative agent and the other financial institutions from time
to time party thereto, as amended by an Amendment No. 1 dated as of May 31,
2001, an Amendment No. 2 dated as of November 19, 2001, an Amendment No. 3 dated
as of December 6, 2002, an Amendment No. 4 dated as of March 18, 2003 and an
Amendment No. 5 dated as of August 6, 2003, together with the documents now or
hereafter related thereto (including without limitation, any guarantee
agreements and any security documents), in each case as such agreements may be
amended (including any amendment and restatement thereof), supplemented or
otherwise modified from time to time, including any agreement extending the
maturity of, refinancing, replacing, increasing the amount of, or otherwise
restructuring all or any portion of the indebtedness under such agreement or any
successor or replacement agreement and whether by the same or any other agent,
lender or group of lenders (or other institutions).
-7-
Significant Subsidiary: The term "Significant Subsidiary" means, with
respect to any Person, a Subsidiary of such Person that would constitute a
"significant subsidiary" as such term is defined under Rule 1-02 of Regulation
S-X of the Commission.
Subsidiary: The term "Subsidiary" means a Person more than 50% of the
outstanding voting stock or Equity Interests of which is owned, directly or
indirectly, by the Company or by one or more other Subsidiaries, or by the
Company and one or more other Subsidiaries. For the purposes of this definition,
"voting stock" means stock which ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class of stock has
such voting power by reason of any contingency.
Transaction Documents: The term "Transaction Documents" shall mean the
Securities Purchase Agreement, the Registration Rights Agreement, the Notes, the
Warrants and each of the other agreements entered into by the parties thereto in
connection with the transactions contemplated by the Securities Purchase
Agreement.
Trust Indenture Act: The term "Trust Indenture Act" shall mean the
Trust Indenture Act of 1939, as amended, as it was in force at the date of
execution of this Indenture, except as provided in Sections 11.3 and 15.7;
provided, however, that in the event the Trust Indenture Act of 1939 is amended
after the date hereof, the term "Trust Indenture Act" shall mean, to the extent
required by such amendment, the Trust Indenture Act of 1939 as so amended.
Trustee: The term "Trustee" shall mean The Bank of New York and its
successors and any corporation resulting from or surviving any consolidation or
merger to which it or its successors may be a party and any successor trustee at
the time serving as successor trustee hereunder.
Unrestricted Global Note: The term "Unrestricted Global Note" shall
mean a permanent Global Note substantially in the form of Exhibit A attached
hereto that bears the Global Note Legend and that has the "Schedule of Exchanges
of Interests in the Global Note" attached thereto, and that is deposited with or
on behalf of and registered in the name of the Depositary, representing a series
of Notes that do not bear the Private Placement Legend.
Unrestricted Definitive Note: The term "Unrestricted Definitive Note"
shall mean one or more Definitive Notes that do not bear and are not required to
bear the Private Placement Legend.
Warrants: The term "Warrants" shall mean the warrants to purchase
shares of Common Stock issued pursuant to the Securities Purchase Agreement and
all warrants issued in exchange, transfer or replacement thereof.
Section 1.2 Other Definitions
<Table>
<Caption>
Defined in
Term Section
---- ----------
"Agent Members".......................................................... 2.2(b)
"Authentication Order"................................................... 2.1
"Change in Control"...................................................... 16.3
</Table>
-8-
<Table>
<Caption>
Defined in
Term Section
---- ----------
"Closing Price".......................................................... 15.5(e)
"Company Notice"......................................................... 16.2(a)
"Continuing Director".................................................... 16.3
"Conversion Date"........................................................ 15.2
"Conversion Price"....................................................... 15.4
"Conversion Shares"...................................................... 15.10
"Current Market Price"................................................... 15.5(e)
"fair market value"...................................................... 15.5(e)
"Holder Conversion Provisional Payment" ................................. 15.1
"non-electing share"..................................................... 15.6
"Note register".......................................................... 2.5(a)
"Note registrar"......................................................... 2.5(a)
"Payment Blockage Notice"................................................ 4.2
"Payment Blockage Period"................................................ 4.2
"Payment Default"........................................................ 4.2
"Proceeding"............................................................. 4.3
"Record Date"............................................................ 2.3
"record date"............................................................ 15.5(d)
"Reference Period"....................................................... 15.5(d)
"Repurchase date"........................................................ 16.1
"Repurchase Event"....................................................... 16.3
"Repurchase Price"....................................................... 16.1
"Restricted Securities".................................................. 2.5(h)(i)
"Securities"............................................................. 15.5(d)
"Senior Indebtedness".................................................... 4.1
"Statutory Exchange"..................................................... 15.7
"Termination of Trading"................................................. 16.3
"Trading Day"............................................................ 15.5(e)
"Trigger Event".......................................................... 15.5(d)
"Vice President"......................................................... 2.1
"Voting Stock"........................................................... 16.3
</Table>
Section 1.3 Rules of Construction
All other terms used in this Indenture, which are defined in the Trust
Indenture Act or which are by reference therein defined in the Securities Act
(except as herein otherwise expressly provided or unless the context otherwise
requires) shall have the meanings assigned to such terms in said Trust Indenture
Act and in said Securities Act as in force at the date of the execution of this
Indenture. The words "herein," "hereof," "hereunder," and words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or other Subdivision. The terms defined in this Article I include the
plural as well as the singular.
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ARTICLE II
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES
Section 2.1 Designation, Amount and Issue of Notes
The Notes shall be designated as "5.0% Convertible Subordinated Notes
due 2008." Notes not to exceed the aggregate principal amount of $30,000,000
upon the execution of this Indenture, or (except pursuant to Sections 2.5, 2.6,
3.3, 15.2 and 16.2) from time to time thereafter, may be executed by the Company
and delivered to the Trustee for authentication, and the Trustee shall thereupon
authenticate and deliver said Notes upon the written order of the Company (the
"Authentication Order"), signed by the Company's (a) President, Chief Executive
Officer, Executive or Senior Vice President or any Vice President (whether or
not designated by a number or numbers or word or words added before or after the
title "Vice President") and (b) Chief Financial Officer, Treasurer or Assistant
Treasurer or its Secretary or any Assistant Secretary, without any further
action by the Company hereunder.
Section 2.2 Form of Notes
(a) Notes issued in global form shall be substantially in the
form of Exhibit A attached hereto (including the Global Note Legend
thereon and the "Schedule of Exchanges of Interests in the Global Note"
attached thereto), which is incorporated in and made a part of this
Indenture. Notes issued in definitive form shall be substantially in
the form of Exhibit A attached hereto (but without the Global Note
Legend thereon and without the "Schedule of Exchanges of Interests in
the Global Note" attached thereto). Each Global Note shall represent
such of the outstanding Notes as shall be specified therein and each
shall provide that it shall represent the aggregate principal amount of
outstanding Notes from time to time endorsed thereon and that the
aggregate principal amount of outstanding Notes represented thereby may
from time to time be reduced or increased, as appropriate, to reflect
purchases, conversions and redemptions. Any endorsement of a Global
Note to reflect the amount of any decrease or increase in the aggregate
principal amount of outstanding Notes represented thereby shall be made
by the Trustee or the Custodian, at the direction of the Trustee, in
accordance with instructions given by the holder thereof as required by
Section 2.5.
The Trustee's certificate of authentication to be borne by
such Notes shall be substantially in the form set forth in Exhibit A.
Any of the Notes may have such letters, numbers or other marks
of identification and such notations, legends and endorsements as the
officers executing the same may approve (execution thereof to be
conclusive evidence of such approval) and as are not inconsistent with
the provisions of this Indenture, or as may be required to comply with
any law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any securities exchange or automated
quotation system on which the Notes may be listed or designated for
issuance, or to conform to usage.
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The terms and provisions contained in the form of Note
attached as Exhibit A hereto shall constitute, and are hereby expressly
made, a part of this Indenture and to the extent applicable, the
Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound
thereby.
(b) Members of, or Participants in, the Depositary ("Agent
Members") shall have no rights under this Indenture with respect to any
Global Note held on their behalf by the Depositary or under any Global
Note, and the Depositary (including, for this purpose, its nominee) may
be treated by the Company, the Trustee and any agent of the Company or
the Trustee as the absolute owner and holder of such Global Note for
all purposes whatsoever. Notwithstanding the foregoing, nothing herein
shall (i) prevent the Company, the Trustee or any agent of the Company
or the Trustee from giving effect to any written certification, proxy
or other authorization furnished by the Depositary or (ii) impair, as
between the Depositary and its Agent Members, the operation of
customary practices governing the exercise of the rights of a holder of
any Note.
Section 2.3 Date and Denomination of Notes; Payments of Interest
The Notes shall be issuable in registered form without coupons in
denominations of $1,000 principal amount and integral multiples thereof. Every
Note shall be dated the date of its authentication, and shall bear interest from
the applicable date and accrued interest shall be payable on each February 15
and August 15 of each year, commencing February 15, 2004, as specified on the
face of the form of Note attached as Exhibit A hereto.
Interest on the Notes shall be deemed to have commenced accruing on
August 7, 2003.
The Person in whose name any Note, or portion thereof (or its
Predecessor Note) is registered at the close of business on any record date with
respect to any interest payment date (including any Note that is converted after
the record date and on or before the interest payment date) shall be entitled to
receive the interest payable on such interest payment date notwithstanding the
cancellation of such Note upon any transfer, exchange or conversion subsequent
to the record date and on or prior to such interest payment date; provided that,
in the case of any Note, or portion thereof, called for redemption or converted
pursuant to Article III or Article XV on a redemption date or conversion date,
as applicable, or repurchased by the Company pursuant to Article XVI on a
repurchase date, during the period from the close of business on the record date
to the close of business on the Business Day next preceding the following
interest payment date, interest shall not be paid to the Person in whose name
the Note, or portion thereof, is registered on the close of business on such
record date, and the Company shall have no obligation to pay interest on such
Note or portion thereof except to the extent required to be paid upon such
redemption, conversion or repurchase in accordance with Article III, Article XV
or Article XVI. Interest may, at the option of the Company, be paid by check
mailed to the address of such Person on the Note registry; provided that, with
respect to any holder of Notes with an aggregate principal amount equal to or in
excess of $500,000, at the request of such holder in writing to the Company,
interest on such holder's Notes shall be paid by wire transfer in immediately
available funds to any bank located in the United States in accordance with the
wire transfer instruction supplied by such holder from time to time to the
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Trustee and paying agent (if different from Trustee) at least two (2) Business
Days prior to the applicable record date. The term "record date" with respect to
any interest payment date shall mean the February 1 or August 1 preceding said
February 15 or August 15, respectively.
Interest on the Notes shall be computed on the basis of a 360-day year
comprised of twelve 30-day months.
If the Company defaults in a payment of interest on the Notes, it shall
pay the defaulted interest in any lawful manner plus, to the extent lawful,
interest payable on the defaulted interest, to the Persons who are holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 7.1 hereof. The Company shall promptly notify the Trustee in
writing of the amount of defaulted interest proposed to be paid on each Note and
the date of the proposed payment. The Company shall fix or cause to be fixed
each such special record date and payment date, provided that no such special
record date shall be less than ten (10) days prior to the related payment date
for such defaulted interest. At least fifteen (15) days before the special
record date, the Company (or, upon the written request of the Company, the
Trustee in the name and at the expense of the Company) shall mail or cause to be
mailed to holders a notice that states the special record date, the related
payment date and the amount of such interest to be paid.
Section 2.4 Execution of Notes
The Notes shall be signed in the name and on behalf of the Company by
the facsimile signature of its President, its Chief Executive Officer, or any of
its Vice Presidents, and attested by the facsimile signature of its Chief
Financial Officer, Treasurer or its Assistant Treasurer, or Secretary or any of
its Assistant Secretaries (which may be printed, engraved or otherwise
reproduced thereon, by facsimile or otherwise). Only such Notes as shall bear
thereon a certificate of authentication substantially in the form set forth on
the form of Note attached as Exhibit A hereto, manually executed by the Trustee
(or an authenticating agent appointed by the Trustee as provided by Section
17.11), shall be entitled to the benefits of this Indenture or be valid or
obligatory for any purpose. Such certificate by the Trustee (or such
authenticating agent) upon any Note executed by the Company shall be conclusive
evidence that the Note so authenticated has been duly authenticated and
delivered hereunder and that the holder thereof is entitled to the benefits of
this Indenture.
In case any officer of the Company who shall have signed any of the
Notes shall cease to be such officer before the Notes so signed shall have been
authenticated and delivered by the Trustee, or disposed of by the Company, such
Notes nevertheless may be authenticated and delivered or disposed of as though
the person who signed such Notes had not ceased to be such officer of the
Company; and any Note may be signed on behalf of the Company by such persons as,
at the actual date of the execution of such Note, shall be the proper officers
of the Company, although at the date of the execution of this Indenture any such
person was not such an officer.
-12-
Section 2.5 Exchange and Registration of Transfer of Notes;
Restrictions on Transfer
(a) Note Register. The Company shall cause to be kept at the
Corporate Trust Office a register (the register maintained in such
office and in any other office or agency of the Company designated
pursuant to Section 5.2 being herein sometimes collectively referred to
as the "Note register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the
registration of Notes and of transfers of Notes. Such register shall be
in written form or in any form capable of being converted into written
form within a reasonable period of time. The Trustee is hereby
appointed "Note registrar" for the purpose of registering Notes and
transfers of Notes as herein provided. The Company may appoint one or
more co-registrars in accordance with Section 5.2.
(b) Transfer and Exchange of Global Notes. A Global Note may
not be transferred as a whole except by the Depositary to a nominee of
the Depositary, by a nominee of the Depositary to the Depositary or to
another nominee of the Depositary, or by the Depositary or any such
nominee to a successor Depositary or a nominee of such successor
Depositary. All Global Notes will be exchanged by the Company for
Definitive Notes if (i) the Company delivers to the Trustee notice from
the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under
the Exchange Act and, in either case, a successor Depositary is not
appointed by the Company within 120 days after the date of such notice
from the Depositary or (ii) the Company in its sole discretion
determines that the Global Notes (in whole but not in part) should be
exchanged for Definitive Notes and delivers a written notice to such
effect to the Trustee. Upon the occurrence of either of the preceding
events in (i) or (ii) above, Definitive Notes shall be issued in such
names as the Depositary shall instruct the Trustee. Global Notes also
may be exchanged or replaced, in whole or in part, as provided in
Sections 2.6 and 2.7. Every Note authenticated and delivered in
exchange for, or in lieu of, a Global Note or any portion thereof,
pursuant to this Section 2.5(b) or Section 2.6 or 2.7, shall be
authenticated and delivered in the form of, and shall be, a Global
Note. A Global Note may not be exchanged for another Note other than as
provided in this Section 2.5(b), however, beneficial interests in a
Global Note may be transferred and exchanged as provided in Section
2.5(c) or (d).
(c) Transfer and Exchange of Beneficial Interests in the
Global Notes. The transfer and exchange of beneficial interests in the
Global Notes shall be effected through the Depositary, in accordance
with the provisions of this Indenture and the Applicable Procedures.
Beneficial interests in the Restricted Global Notes shall be subject to
restrictions on transfer comparable to those set forth herein to the
extent required by the Securities Act. Transfers of beneficial
interests in the Global Notes also shall require compliance with either
subparagraph (i) or (ii) below, as applicable, as well as one or more
of the other following subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same
Global Note. Beneficial interests in any Restricted Global
Note may be transferred to Persons who take delivery thereof
in the form of a beneficial interest in the same
-13-
Restricted Global Note in accordance with the transfer
restrictions set forth in the Private Placement Legend.
Beneficial interests in any Unrestricted Global Note may be
transferred to Persons who take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note. No
written orders or instructions shall be required to be
delivered to the Registrar to effect the transfers described
in this Section 2.5(c)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Notes. In connection with all transfers
and exchanges of beneficial interests that are not subject to
Section 2.5(c)(i) above, the transferor of such beneficial
interest must deliver to the Registrar either (A) (1) a
written order from a Participant or an Indirect Participant
given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or cause to be
credited a beneficial interest in another Global Note in an
amount equal to the beneficial interest to be transferred or
exchanged and (2) instructions given in accordance with the
Applicable Procedures containing information regarding the
Participant account to be credited with such increase or (B)
(1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the
Applicable Procedures directing the Depositary to cause to be
issued a Definitive Note in an amount equal to the beneficial
interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Note registrar containing
information regarding the Person in whose name such Definitive
Note shall be registered to effect the transfer or exchange
referred to in (1) above. Upon satisfaction of all of the
requirements for transfer or exchange of beneficial interests
in Global Notes contained in this Indenture and the Notes or
otherwise applicable under the Securities Act, the Trustee
shall adjust the principal amount of the relevant Global
Note(s) pursuant to Section 2.5(l).
(iii) Transfer of Beneficial Interests to Another
Restricted Global Note. A beneficial interest in any
Restricted Global Note may be transferred to a Person who
takes delivery thereof in the form of a beneficial interest in
another Restricted Global Note if the transfer complies with
the requirements of Section 2.5(c)(ii) above and the Note
registrar receives the following:
(A) if the transferee will take delivery in
the form of a beneficial interest in the 144A Global
Note, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the
certifications in item (1) thereof; and
(B) if the transferee will take delivery in
the form of a beneficial interest in the IAI Global
Note, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the
certifications and certificates and Opinion of
Counsel required by item (2) thereof, if applicable.
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(iv) Transfer of Beneficial Interests in a Restricted
Global Note for Beneficial Interests in the Unrestricted
Global Note. A beneficial interest in any Restricted Global
Note may be transferred to a Person who takes delivery thereof
in the form of a beneficial interest in an Unrestricted Global
Note if the transfer complies with the requirements of Section
2.5(c)(ii) above and
(A) such transfer is effected pursuant to a
registration statement filed in accordance with the
Registration Rights Agreement; or
(B) the Note registrar receives the
following:
(1) if the Holder of such
beneficial interest in a Restricted Global
Note proposes to exchange such beneficial
interest for a beneficial interest in an
Unrestricted Global Note, a certificate from
such holder in the form of Exhibit C hereto,
including the certifications in item (1)(a)
thereof; or
(2) if the Holder of such beneficial
interest in a Restricted Global Note
proposes to transfer such beneficial
interest to a Person who shall take delivery
thereof in the form of a beneficial interest
in the Unrestricted Global Note, a
certificate from such holder in the form of
Exhibit B hereto, including the
certifications in item (3) thereof;
and, in each such case set forth in this subparagraph
(B), if the Note registrar so requests or if the
Applicable Procedures so require, an Opinion of
Counsel in form reasonably acceptable to the Note
registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and
that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer
required in order to maintain compliance with the
Securities Act.
If any such transfer is effected pursuant to
subparagraph (B) above at a time when an Unrestricted Global
Note has not yet been issued, the Company shall issue and,
upon receipt of an Authentication Order in accordance with
Section 2.1, the Trustee shall authenticate one or more
Unrestricted Global Notes in an aggregate principal amount
equal to the aggregate principal amount of beneficial
interests transferred pursuant to subparagraph (B) above.
Beneficial interests in an Unrestricted Global Note
cannot be exchanged for, or transferred to Persons who take
delivery thereof in the form of, a beneficial interest in a
Restricted Global Note.
(d) Transfer or Exchange of Beneficial Interests for
Definitive Notes.
(i) Beneficial Interests in Restricted Global Notes
to Restricted Definitive Notes. If any holder of a beneficial
interest in a Restricted Global Note
-15-
proposes to exchange such beneficial interest for a Restricted
Definitive Note or to transfer such beneficial interest to a
Person who takes delivery thereof in the form of a Restricted
Definitive Note, then, upon receipt by the Note registrar of
the following documentation:
(A) if the holder of such beneficial
interest in a Restricted Global Note proposes to
exchange such beneficial interest for a Restricted
Definitive Note, a certificate from such holder in
the form of Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A
under the Securities Act, a certificate to the effect
set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being
transferred pursuant to an exemption from the
registration requirements of the Securities Act in
accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2)(a)
thereof;
(D) if such beneficial interest is being
transferred to an Institutional Accredited Investor
in reliance on an exemption from the registration
requirements of the Securities Act other than those
listed in subparagraphs (B) and (C) above, a
certificate to the effect set forth in Exhibit B
hereto, including the certifications, certificates
and Opinion of Counsel required by item (2) thereof,
if applicable;
(E) if such beneficial interest is being
transferred to the Company or any of its
Subsidiaries, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in
item (2)(b) thereof; or
(F) if such beneficial interest is being
transferred pursuant to an effective registration
statement under the Securities Act, a certificate to
the effect set forth in Exhibit B hereto, including
the certifications in item (2)(c) thereof;
the Trustee shall cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to Section
2.5(l), and the Company shall execute and the Trustee shall
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount. Any Definitive
Note issued in exchange for a beneficial interest in a Restricted
Global Note pursuant to this Section 2.5(d) shall be registered in such
name or names and in such authorized denomination or denominations as
the holder of such beneficial interest shall instruct the Note
registrar through instructions from the Depositary and the Participant
or Indirect Participant. The Trustee shall deliver such Definitive
Notes to the Persons in whose names such Notes are
-16-
so registered. Any Definitive Note issued in exchange for a beneficial
interest in a Restricted Global Note pursuant to this Section 2.5(d)(i)
shall bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Notes
to Unrestricted Definitive Notes. A holder of a beneficial
interest in a Restricted Global Note may exchange such
beneficial interest for an Unrestricted Definitive Note or may
transfer such beneficial interest to a Person who takes
delivery thereof in the form of an Unrestricted Definitive
Note only if:
(A) such transfer is effected pursuant to a
registration statement filed in accordance with the
Registration Rights Agreement; or
(B) the Note registrar receives the
following:
(1) if the Holder of such
beneficial interest in a Restricted Global
Notes proposes to exchange such beneficial
interest for an Unrestricted Definitive
Note, a certificate from such holder in the
form of Exhibit C hereto, including the
certifications in item (1)(b) thereof; or
(2) if the Holder of such
beneficial interest in a Restricted Global
Notes proposes to transfer such beneficial
interest to a Person who shall take delivery
thereof in the form of an Unrestricted
Definitive Note, a certificate from such
holder in the form of Exhibit B hereto,
including the certifications in item (3)
thereof;
and, in each such case set forth in this subparagraph (B), if
the Note registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably
acceptable to the Note registrar to the effect that such
exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global
Notes to Unrestricted Definitive Notes. If any holder of a
beneficial interest in an Unrestricted Global Note proposes to
exchange such beneficial interest for an Unrestricted
Definitive Note or to transfer such beneficial interest to a
Person who takes delivery thereof in the form of an
Unrestricted Definitive Note, then, upon satisfaction of the
conditions set forth in Section 2.5(c)(ii), the Trustee shall
cause the aggregate principal amount of the applicable Global
Note to be reduced accordingly pursuant to Section 2.5(l), and
the Company shall execute and the Trustee shall authenticate
and deliver to the Person designated in the instructions an
Unrestricted Definitive Note in the appropriate principal
amount. Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section
-17-
2.5(d)(iii) shall be registered in such name or names and in
such authorized denomination or denominations as the holder of
such beneficial interest shall instruct the Note registrar
through instructions from the Depositary and the Participant
or Indirect Participant. The Trustee shall deliver such
Unrestricted Definitive Notes to the Persons in whose names
such Notes are so registered. Any Unrestricted Definitive Note
issued in exchange for a beneficial interest pursuant to this
Section 2.5(d)(iii) shall not bear the Private Placement
Legend.
(e) Transfer and Exchange of Definitive Notes for Beneficial
Interests.
(i) Restricted Definitive Notes to Beneficial
Interests in Restricted Global Notes. If any Holder of a
Restricted Definitive Note proposes to exchange such Note for
a beneficial interest in a Restricted Global Note or to
transfer such Restricted Definitive Notes to a Person who
takes delivery thereof in the form of a beneficial interest in
a Restricted Global Note, then, upon receipt by the Registrar
of the following documentation:
(A) if the Holder of such Restricted
Definitive Note proposes to exchange such Note for a
beneficial interest in a Restricted Global Note, a
certificate from such Holder in the form of Exhibit C
hereto, including the certifications in item (2)(b)
thereof;
(B) if such Restricted Definitive Note is
being transferred to a QIB in accordance with Rule
144A under the Securities Act, a certificate to the
effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such Restricted Definitive Note is
being transferred pursuant to an exemption from the
registration requirements of the Securities Act in
accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2)(a)
thereof;
(D) if such Restricted Definitive Note is
being transferred to an Institutional Accredited
Investor in reliance on an exemption from the
registration requirements of the Securities Act other
than those listed in subparagraphs (B) and (C) above,
a certificate to the effect set forth in Exhibit B
hereto, including the certifications, certificates
and Opinion of Counsel required by item (2) thereof,
if applicable;
(E) if such Restricted Definitive Note is
being transferred to the Company or any of its
Subsidiaries, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in
item (2)(b) thereof; or
(F) if such Restricted Definitive Note is
being transferred pursuant to an effective
registration statement under the Securities Act, a
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certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (2)(c)
thereof;
the Trustee shall cancel the Restricted Definitive Note,
increase or cause to be increased the aggregate principal
amount of, in the case of clause (A) above, the appropriate
Restricted Global Note, in the case of clause (B) above, the
144A Global Note, and in all other cases, the IAI Global Note.
(ii) Restricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of a
Restricted Definitive Note may exchange such Note for a
beneficial interest in an Unrestricted Global Note or transfer
such Restricted Definitive Note to a Person who takes delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Note only if:
(A) such transfer is effected pursuant to a
registration statement filed in accordance with the
Registration Rights Agreement; or
(B) the Note registrar receives the
following:
(1) if the Holder of such
Restricted Definitive Notes proposes to
exchange such Notes for a beneficial
interest in the Unrestricted Global Note, a
certificate from such holder in the form of
Exhibit C hereto, including the
certifications in item (1)(c) thereof; or
(2) if the Holder of such
Restricted Definitive Notes proposes to
transfer such Notes to a Person who shall
take delivery thereof in the form of a
beneficial interest in the Unrestricted
Global Note, a certificate from such holder
in the form of Exhibit B hereto, including
the certifications in item (3) thereof;
and, in each such case set forth in this subparagraph (B), if
the Note registrar so requests or if the Applicable Procedures
so require, an Opinion of Counsel in form reasonably
acceptable to the Note registrar to the effect that such
exchange or transfer is in compliance with the Securities Act
and that the restrictions on transfer contained herein and in
the Private Placement Legend are no longer required in order
to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the
subparagraphs in this Section 2.5(e)(ii), the Trustee shall
cancel the Restricted Definitive Notes and increase or cause
to be increased the aggregate principal amount of the
Unrestricted Global Note.
(iii) Unrestricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes. A Holder of an
Unrestricted Definitive Note may exchange such Note for a
beneficial interest in an Unrestricted Global Note or transfer
such Unrestricted Definitive Notes to a Person who takes
delivery thereof
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in the form of a beneficial interest in an Unrestricted Global
Note at any time. Upon receipt of a request for such an
exchange or transfer, the Trustee shall cancel the applicable
Unrestricted Definitive Note and increase or cause to be
increased the aggregate principal amount of one of the
Unrestricted Global Notes.
If any such exchange or transfer from an Unrestricted
Definitive Note to a beneficial interest is effected pursuant
to subparagraphs (ii)(A), (ii)(B) or (iii) above at a time
when an Unrestricted Global Note has not yet been issued, the
Company shall issue and, upon receipt of an Authentication
Order in accordance with Section 2.1, the Trustee shall
authenticate one or more Unrestricted Global Notes in an
aggregate principal amount equal to the principal amount of
Unrestricted Definitive Notes so transferred.
(f) Transfer and Exchange of Definitive Notes for Definitive
Notes. Upon request by a Holder of Definitive Notes and such Holder's
compliance with the provisions of this Section 2.5(f), the Note
registrar shall register the transfer or exchange of Definitive Notes.
Prior to such registration of transfer or exchange, the requesting
Holder shall present or surrender to the Note registrar the Definitive
Notes duly endorsed or accompanied by a written instruction of transfer
in form satisfactory to the Note registrar duly executed by such Holder
or by its attorney, duly authorized in writing. In addition, the
requesting Holder shall provide any additional certifications,
documents and information, as applicable, required pursuant to the
following provisions of this Section 2.5(f).
(i) Restricted Definitive Notes to Restricted
Definitive Notes. Any Restricted Definitive Note may be
transferred to and registered in the name of Persons who take
delivery thereof in the form of a Restricted Definitive Note
if the Registrar receives the following:
(A) if the transfer will be made pursuant to
Rule 144A under the Securities Act, then the
transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications in
item (1) thereof; and
(B) if the transfer will be made pursuant to
any other exemption from the registration
requirements of the Securities Act, then the
transferor must deliver a certificate in the form of
Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item
(2) thereof, if applicable.
(ii) Restricted Definitive Notes to Unrestricted
Definitive Notes. Any Restricted Definitive Note may be
exchanged by the Holder thereof for an Unrestricted Definitive
Note or transferred to a Person or Persons who take delivery
thereof in the form of an Unrestricted Definitive Note if:
(A) any such transfer is effected pursuant
to a registration statement filed in accordance with
the Registration Rights Agreement; or
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(B) the Note registrar receives the
following:
(1) if the Holder of such
Restricted Definitive Notes proposes to
exchange such Notes for an Unrestricted
Definitive Note, a certificate from such
Holder in the form of Exhibit C hereto,
including the certifications in item (1)(d)
thereof; or
(2) if the Holder of such Restricted
Definitive Notes proposes to transfer such
Notes to a Person who shall take delivery
thereof in the form of an Unrestricted
Definitive Note, a certificate from such
Holder in the form of Exhibit B hereto,
including the certifications in item (3)
thereof;
and, in each such case set forth in this subparagraph
(B), if the Note registrar so requests, an Opinion of
Counsel in form reasonably acceptable to the Company
to the effect that such exchange or transfer is in
compliance with the Securities Act and that the
restrictions on transfer contained herein and in the
Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
(iii) Unrestricted Definitive Notes to Unrestricted
Definitive Notes. A Holder of Unrestricted Definitive Notes
may transfer such Notes to a Person who takes delivery thereof
in the form of an Unrestricted Definitive Note. Upon receipt
of a request to register such a transfer, the Note registrar
shall register the Unrestricted Definitive Notes pursuant to
the instructions from the Holder thereof.
(g) General Provisions Relating to Transfers and Exchanges.
Upon surrender for registration of transfer of any Note to the
Note registrar or any co-registrar, and satisfaction of the
requirements for such transfer set forth in this Section 2.5, the
Company shall execute, and the Trustee shall authenticate and deliver,
in the name of the designated transferee or transferees, one or more
new Notes of any authorized denominations and of a like aggregate
principal amount and bearing such restrictive legends as may be
required by this Indenture.
No service charge shall be charged to the Noteholder for any
exchange or registration of transfer of Notes, but the Company may
require payment of a sum sufficient to cover any tax, assessments or
other governmental charges that may be imposed in connection therewith.
None of the Company, the Trustee, the Note registrar or any
co-registrar shall be required to exchange or register a transfer of
(a) any Notes for a period of fifteen (15) days next preceding the
mailing of the notice of redemption or (b) any Notes called for
redemption or, if a portion of any Note is selected or called for
redemption, such portion thereof selected or called for redemption or
(c) any Notes surrendered for conversion or, if a portion of any Note
is surrendered for conversion, such portion thereof surrendered
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for conversion or (d) any Notes, or a portion of any Note, surrendered
for repurchase (and not withdrawn) in connection with a Repurchase
Event.
All Notes issued upon any transfer or exchange of Notes in
accordance with this Indenture shall be the valid obligations of the
Company, evidencing the same debt, and entitled to the same benefits
under this Indenture as the Notes surrendered upon such registration of
transfer or exchange.
Prior to due presentment for the registration of a transfer of
any Note, the Trustee, any agent and the Company may deem and treat the
Person in whose name any Note is registered as the absolute owner of
such Note for the purpose of receiving payment of principal of and
interest on such Notes and for all other purposes, and none of the
Trustee, any agent or the Company shall be affected by notice to the
contrary.
The Trustee shall authenticate Global Notes and Definitive
Notes in accordance with the provisions of Section 2.1.
(h) Legends.
(i) Private Placement Legend on the Notes. Every Note
that bears or is required under this Section 2.5(h)(i) to bear
the legend set forth in this Section 2.5(h)(i) (together with
any Common Stock issued upon conversion of the Notes and
required to bear the legend set forth in Section 2.5(h)(ii),
collectively, the "Restricted Securities") shall be subject to
the restrictions on transfer set forth in this Section
2.5(h)(i) (including the legend set forth below), unless such
restrictions on transfer shall be waived by written consent of
the Company, and the holder of each such Restricted Security,
by such holder's acceptance thereof, agrees to be bound by all
such restrictions on transfer. As used in Sections 2.5(h)(i)
and 2.5(h)(ii), the term "transfer" encompasses any sale,
transfer or other disposition (excluding any pledge unless or
until any foreclosure on such pledge) whatsoever of any
Restricted Security.
Subject to Section 5 of the Securities Purchase
Agreement, until two (2) years after the original issuance
date of any Note, any certificate evidencing such Note (and
all securities issued in exchange therefor or substitution
thereof, other than Common Stock, if any, issued upon
conversion thereof which shall bear the legend set forth in
Section 2.5(h)(ii), if applicable) shall bear a legend in
substantially the following form (unless such Note has been
transferred pursuant to a registration statement that has been
declared effective under the Securities Act (and which
continues to be effective at the time of such transfer), or
the Note has been transferred pursuant to the exemption from
registration provided by Rule 144 under the Securities Act, or
unless otherwise agreed by the Company in writing, with notice
thereof to the Trustee):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT") OR APPLICABLE
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STATE SECURITIES LAWS. THIS SECURITY MAY NOT BE OFFERED FOR
SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE
SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS OR AN
EXEMPTION THEREFROM. THIS SECURITY MAY BE PLEDGED IN
CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN
SECURED BY THIS SECURITY.
The Company may, but is not obligated to, instruct
the Trustee to place the following legend on any Note held by
or transferred to an "affiliate" (as defined in Rule 501(b) of
Regulation D under the Securities Act):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A
PERSON WHO MAY BE DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR
PURPOSES OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY BE SOLD ONLY
IN COMPLIANCE WITH RULE 144, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO
A VALID EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT.
THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE
MARGIN ACCOUNT OR OTHER LOAN SECURED BY THE SECURITIES.
Any Note (or security issued in exchange or
substitution therefor) as to which such restrictions on
transfer shall have expired in accordance with their terms
may, upon surrender of such Note for exchange to the Note
registrar in accordance with the provisions of this Section
2.5, be exchanged for a new Note or Notes, of like tenor and
aggregate principal amount, which shall not bear the
restrictive legend required by this Section 2.5(h)(i).
(ii) Private Placement Legend on Stock Certificate.
Until two (2) years after the original issuance date of any
Note, any stock certificate representing Common Stock issued
upon conversion of such Note shall bear a legend in
substantially the following form (unless such Common Stock has
been transferred pursuant to a registration statement that has
been declared effective under the Securities Act (and which
continues to be effective at the time of such transfer), or
the Notes from which such Common Stock was converted were
transferred pursuant to a registration statement that has been
declared effective under the Securities Act and which was
effective at the time of such transfer, or the Common Stock
has been transferred pursuant to an exemption from
registration provided by Rule 144 under the Securities Act, or
unless otherwise agreed by the Company in writing with written
notice thereof to the Trustee and any transfer agent for the
Common Stock):
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
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AMENDED (THE "SECURITIES ACT") OR APPLICABLE STATE SECURITIES
LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES
ACT OR APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION
THEREFROM. THE SECURITIES MAY BE PLEDGED IN CONNECTION WITH A
BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY THE
SECURITIES.
The Company may, but is not obligated to, instruct
the transfer agent for the Company's Common Stock to place the
following legend on any certificate evidencing shares of
Common Stock held by or transferred to an "affiliate" (as
defined in Rule 501(b) of Regulation D under the Securities
Act) of the Company:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A
PERSON WHO MAY BE DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR
PURPOSES OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "1933 ACT"), AND MAY BE SOLD ONLY IN
COMPLIANCE WITH RULE 144, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE 1933 ACT OR PURSUANT TO A
VALID EXEMPTION FROM REGISTRATION UNDER THE 1933 ACT.
Any such Common Stock as to which such restrictions
on transfer shall have expired in accordance with their terms
may, upon surrender of the certificates representing such
shares of Common Stock for exchange in accordance with the
procedures of the transfer agent for the Common Stock, be
exchanged for a new certificate or certificates for a like
aggregate number of shares of Common Stock, which shall not
bear the restrictive legend required by this Section
2.5(h)(ii).
(iii) Global Note Legend. Each Global Note shall bear
a legend in substantially the following form:
THIS GLOBAL NOTE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR
THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT
(I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE
REQUIRED PURSUANT TO SECTION 2.6 OF THE INDENTURE, (II) THIS
GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT
TO SECTION 2.5(b) OF THE INDENTURE, (III) THIS GLOBAL NOTE MAY
BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO
SECTION 2.8 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN
CONSENT OF THE COMPANY.
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(i) Resale of Notes Purchased by the Company or an Affiliate.
Any Note or Common Stock issued upon the conversion or exchange of a
Note that, prior to the expiration of the holding period applicable to
sales thereof under Rule 144(k) under the Securities Act (or any
successor rule), is purchased or owned by the Company or any Affiliate
thereof may not be resold by the Company or such Affiliate unless
registered under the Securities Act or resold pursuant to an exemption
from the registration requirements of the Securities Act in a
transaction that results in such Notes or Common Stock, as the case may
be, no longer being "restricted securities" (as defined under Rule
144).
(j) Changes in Law. Notwithstanding any provision of Section
2.5 to the contrary, in the event Rule 144(k) as promulgated under the
Securities Act (or any successor rule) is amended to change the
two-year period under Rule 144(k) (or the corresponding period under
any successor rule), from and after receipt by the Trustee of the
Officer's Certificate and Opinion of Counsel provided for in this
Section 2.5(j), (i) each reference in Section 2.5(h)(i) to "two (2)
years" shall be deemed for all purposes hereof to be references to such
changed period, (ii) each reference in Section 2.5(h)(ii) to "two (2)
years" shall be deemed for all purposes hereof to be references to such
changed period and (iii) all corresponding references in the Notes
shall be deemed for all purposes hereof to be references to such
changed period, provided that such changes shall not become effective
if they are otherwise prohibited by, or would otherwise cause a
violation of, the then-applicable federal securities laws. As soon as
practicable after the Company has knowledge of the effectiveness of any
such amendment to change the two-year period under Rule 144(k) (or the
corresponding period under any successor rule), unless such changes
would otherwise be prohibited by, or would otherwise cause a violation
of, the then-applicable securities law, the Company shall provide to
the Trustee an Officer's Certificate and Opinion of Counsel informing
the Trustee of the effectiveness of such amendment and the
effectiveness of the foregoing changes to Sections 2.5(h)(i) and
2.5(h)(ii) and the Notes. The provisions of this Section 2.5(j) will
not be effective until such time as the Opinion of Counsel and
Officer's Certificate have been received by the Trustee hereunder. This
Section 2.5(j) shall apply to successive amendments to Rule 144(k) (or
any successor rule) changing the holding period thereunder.
(k) Limitation on Trustee's Duties. The Trustee shall have no
obligation or duty to monitor, determine or inquire as to compliance
with any restrictions on transfer imposed under this Indenture or under
applicable law with respect to any transfer of any interest in any Note
other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if
and when expressly required by the terms of, this Indenture, and to
examine the same to determine substantial compliance as to form with
the express requirements hereof.
(l) Cancellation and/or Adjustment of Global Notes. At such
time as all beneficial interests in a particular Global Note have been
exchanged for Definitive Notes or a particular Global Note has been
redeemed, repurchased or canceled in whole and not in part, each such
Global Note shall be returned to or retained and canceled by the
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Trustee in accordance with Section 2.8. At any time prior to such
cancellation, if any beneficial interest in a Global Note is exchanged
for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note
shall be reduced accordingly and an endorsement shall be made on such
Global Note by the Trustee or by the Depositary at the direction of the
Trustee to reflect such reduction; and if the beneficial interest is
being exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Note,
such other Global Note shall be increased accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the
Depositary at the direction of the Trustee to reflect such increase.
Section 2.6 Mutilated, Destroyed, Lost or Stolen Notes
In case any Note shall become mutilated or be destroyed, lost or
stolen, the Company in its discretion may execute, and upon its request the
Trustee or an authenticating agent appointed by the Trustee shall authenticate
and deliver, a new Note, bearing a number not contemporaneously outstanding, in
exchange and substitution for the mutilated Note, or in lieu of and in
substitution for the Note so destroyed, lost or stolen. In every case the
applicant for a substituted Note shall furnish to the Company, to the Trustee
and, if applicable, to such authenticating agent such security or indemnity as
required by them to save each of them harmless for any loss, liability, cost or
expense caused by or connected with such substitution, and, in every case of
destruction, loss or theft, the applicant shall also furnish to the Company, to
the Trustee and, if applicable, to such authenticating agent evidence to their
reasonable satisfaction of the destruction, loss or theft of such Note and of
the ownership thereof.
The Trustee or such authenticating agent may authenticate any such
substituted Note and deliver the same upon the receipt of such security or
indemnity as the Trustee, the Company and, if applicable, such authenticating
agent may reasonably require. Upon the issuance of any substituted Note, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses connected therewith. Once any substitute Note has been issued pursuant
to this Section 2.6, the original Note being replaced by such substitute Note
shall automatically be deemed cancelled. In case any Note which has matured or
is about to mature or has been called for redemption or is about to be converted
into Common Stock shall become mutilated or be destroyed, lost or stolen, the
Company may, instead of issuing a substitute Note, pay or authorize the payment
of or convert or authorize the conversion of the same (without surrender thereof
except in the case of a mutilated Note), as the case may be, if the applicant
for such payment or conversion shall furnish to the Company, to the Trustee and,
if applicable, to such authenticating agent such security or indemnity as will
be required by them to save each of them harmless for any loss, liability, cost
or expense caused by or connected with such substitution, and, in case of
destruction, loss or theft, evidence reasonably satisfactory to the Company, the
Trustee and, if applicable, any paying agent or conversion agent of the
destruction, loss or theft of such Note and of the ownership thereof.
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Every substitute Note issued pursuant to the provisions of this Section
2.6 by virtue of the fact that any Note is destroyed, lost or stolen shall
constitute an additional contractual obligation of the Company, whether or not
the destroyed, lost or stolen Note shall be found at any time, and shall be
entitled to all the benefits of (but shall be subject to all the limitations set
forth in) this Indenture equally and proportionately with any and all other
Notes duly issued hereunder. To the extent permitted by law, all Notes shall be
held and owned upon the express condition that the foregoing provisions are
exclusive with respect to the replacement or payment or conversion of mutilated,
destroyed, lost or stolen Notes and shall preclude any and all other rights or
remedies notwithstanding any law or statute existing or hereafter enacted to the
contrary with respect to the replacement or payment or conversion of negotiable
instruments or other securities without their surrender.
Section 2.7 Temporary Notes
Pending the preparation of definitive Notes, the Company may execute
and the Trustee or an authenticating agent appointed by the Trustee shall, upon
written request of the Company, authenticate and deliver temporary Notes
(printed or lithographed). Temporary Notes shall be issuable in any authorized
denomination, and substantially in the form of the Global Notes or the
Definitive Notes, as the case may be, but with such omissions, insertions and
variations as may be appropriate for temporary Notes, all as may be determined
by the Company. Every such temporary Note shall be executed by the Company and
authenticated by the Trustee or such authenticating agent upon the same
conditions and in substantially the same manner, and with the same effect, as
the Definitive Notes or Global Notes. Without unreasonable delay the Company
will execute and deliver to the Trustee or such authenticating agent Definitive
Notes and Global Notes and thereupon any or all temporary Notes may be
surrendered in exchange for the applicable replacement Note, at each office or
agency maintained by the Company pursuant to Section 5.2 and the Trustee or such
authenticating agent shall authenticate and deliver in exchange for such
temporary Notes an equal aggregate principal amount of Definitive Notes or
Global Notes, as the case may be. Such exchange shall be made by the Company at
its own expense and without any charge therefor. Until so exchanged, the
temporary Notes shall in all respects be entitled to the same benefits and
subject to the same limitations under this Indenture as Definitive Notes or
Global Notes, as the case may be, authenticated and delivered hereunder.
Section 2.8 Cancellation of Notes Paid, Etc.
All Notes surrendered for the purpose of payment, redemption,
repurchase, conversion, exchange or registration of transfer, shall, if
surrendered to the Company or any paying agent or any Note registrar or any
conversion agent, be surrendered to the Trustee and promptly canceled by it, or,
if surrendered to the Trustee, shall be promptly canceled by it, and no Notes
shall be issued in lieu thereof except as expressly permitted by any of the
provisions of this Indenture. Upon written instructions of the Company, the
Trustee shall dispose of canceled Notes in accordance with its customary
procedures. If the Company shall acquire any of the Notes, such acquisition
shall not operate as a redemption or satisfaction of the indebtedness
represented by such Notes unless and until the same are delivered to the Trustee
for cancellation.
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Section 2.9 CUSIP Numbers
The Company in issuing the Notes may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Notes or as contained in any notice of a redemption and
that reliance may be placed only on the other identification numbers printed on
the Notes, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Company will promptly notify the Trustee of any
change in the "CUSIP" numbers.
ARTICLE III
OPTIONAL REDEMPTION OF NOTES
Section 3.1 Redemption Price
From and after August 7, 2006, the Company may, at its option, redeem
all or any part of the Notes, upon notice as set forth in Section 3.2, and the
Company shall pay each holder of Notes redeemed a redemption price equal to the
principal amount of such Notes, plus accrued and unpaid interest thereon, if
any, to, but not including, the date of redemption.
Section 3.2 Notice of Redemption; Selection of Notes
In case the Company shall desire to exercise the right to redeem all
or, as the case may be, any part of the Notes pursuant to Section 3.1, it shall
fix a date for redemption, and it, or at its request (which must be received by
the Trustee at least ten (10) Business Days prior to the date the Trustee is
requested to give notice as described below unless a shorter period is agreed to
by the Trustee), the Trustee in the name of and at the expense of the Company,
shall mail or cause to be mailed a notice of such redemption at least thirty
(30) and not more than ninety (90) days prior to the date fixed for redemption
to the holders of Notes so to be redeemed as a whole or in part at their last
addresses as the same appear on the Note register (provided that if the Company
shall give such notice, it shall also give such notice, and notice of the
aggregate amount of Notes to be redeemed, to the Trustee). Such mailing shall be
by first class mail. The notice if mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the holder
receives such notice. In any case, failure to give such notice by mail or any
defect in the notice to the holder of any Note designated for redemption as a
whole or in part shall not affect the validity of the proceedings for the
redemption of any other Note.
Each such notice of redemption shall specify the aggregate principal
amount of Notes to be redeemed, the "CUSIP" number or numbers of such Notes, if
any, the date fixed for redemption, the redemption price at which Notes are to
be redeemed, the place or places of payment, that payment will be made upon
presentation and surrender of such Notes, that interest accrued to, but
excluding, the date fixed for redemption will be paid as specified in said
notice, and that on and after said date interest thereon or on the portion
thereof to be redeemed will
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cease to accrue. Such notice shall also state the current Conversion Price and
the date on which the right to convert such Notes or portions thereof into
Common Stock will expire. If fewer than all the Notes are to be redeemed, the
notice of redemption shall identify the Notes to be redeemed. In case any Note
is to be redeemed in part only, the notice of redemption shall state the portion
of the principal amount thereof to be redeemed and shall state that on and after
the date fixed for redemption, upon surrender of such Note, a new Note or Notes
in principal amount equal to the unredeemed portion thereof will be issued.
On or prior to the redemption date specified in the notice of
redemption given as provided in this Section, the Company will deposit with the
Trustee or with one or more paying agents (or, if the Company is acting as its
own paying agent, set aside, segregate and hold in trust as provided in Section
5.4) an amount of money sufficient to redeem on the redemption date all the
Notes (or portions thereof) so called for redemption (other than those
theretofore surrendered for conversion into Common Stock) at the appropriate
redemption price, together with accrued interest to, but excluding, the date
fixed for redemption; provided that if such payment is made on the redemption
date it must be received by the Trustee or paying agent, as the case may be, by
10:00 a.m. New York City time, on such date. If any Note called for redemption
is converted pursuant hereto, any money deposited with the Trustee or any paying
agent or so segregated and held in trust for the redemption of such Note shall
be paid to the Company upon its request, or, if then held by the Company shall
be discharged from such trust.
If fewer than all the Notes are to be redeemed, the Company will give
the Trustee written notice in the form of an Officer's Certificate not fewer
than forty-five (45) days (or such shorter period of time as may be acceptable
to the Trustee) prior to the redemption date as to the aggregate principal
amount of Notes to be redeemed. If fewer than all the Notes are to be redeemed,
the Trustee shall select the Notes or portions thereof to be redeemed (in
principal amounts of $1,000 or integral multiples thereof), on a pro rata basis
or by lot. If any Note selected for partial redemption is converted in part
after such selection, the converted portion of such Note shall be deemed (so far
as is possible) to be the portion to be selected for redemption. The Notes (or
portions thereof) so selected shall be deemed duly selected for redemption for
all purposes hereof, notwithstanding that any such Note is converted as a whole
or in part before the mailing of the notice of redemption.
Upon any redemption of less than all Notes, the Company and the Trustee
may (but need not) treat as outstanding any Notes surrendered for conversion
during the period of fifteen (15) days next preceding the mailing of a notice of
redemption and may (but need not) treat as not outstanding any Note
authenticated and delivered during such period in exchange for the unconverted
portion of any Note converted in part during such period.
Section 3.3 Payment of Notes Called for Redemption
If notice of redemption has been given as above provided, the Notes or
portion of Notes with respect to which such notice has been given shall, unless
converted into Common Stock pursuant to the terms hereof, become due and payable
on the date and at the place or places stated in such notice at the applicable
redemption price, and interest accrued to, but excluding, the date fixed for
redemption, and on and after said date (unless the Company shall default in the
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payment of such Notes at the redemption price and interest accrued to, but
excluding, said date) interest on the Notes or portion of Notes so called for
redemption shall cease to accrue and such Notes shall cease after the close of
business on the Business Day next preceding the date fixed for redemption to be
convertible into Common Stock and, except as provided in Sections 8.5 and 13.4,
to be entitled to any benefit or security under this Indenture, and the holders
thereof shall have no right in respect of such Notes except the right to receive
the redemption price thereof and unpaid interest to, but excluding, the date
fixed for redemption. On presentation and surrender of such Notes at a place of
payment specified in said notice, the said Notes or the specified portions
thereof to be redeemed shall be paid and redeemed by the Company at the
applicable redemption price and interest accrued thereon to, but excluding, the
date fixed for redemption; provided that, if the applicable redemption date is
an interest payment date, the semi-annual payment of interest becoming due on
such date shall be payable to the holders of such Notes registered as such on
the relevant record date subject to the terms and provisions of Section 2.3.
Upon presentation of any Note redeemed in part only, the Company shall
execute and the Trustee shall authenticate and deliver to the holder thereof, at
the expense of the Company, a new Note or Notes, of authorized denominations, in
principal amount equal to the unredeemed portion of the Notes so presented.
Notwithstanding the foregoing, the Trustee shall not redeem any Notes
or mail any notice of optional redemption during the continuance of a default in
payment of interest or premium on the Notes or of any Event of Default of which,
in the case of any Event of Default other than under Section 7.1(a), (b) or (d),
a Responsible Officer of the Trustee has actual knowledge. If any Note called
for redemption shall not be so paid upon surrender thereof for redemption, the
principal and premium, if any, shall, until paid or duly provided for, bear
interest from the date fixed for redemption at the rate borne by the Note and
such Note shall remain convertible into Common Stock until the principal and
premium, if any, shall have been paid or duly provided for.
Section 3.4 Conversion Arrangement on Call for Redemption
In connection with any redemption of Notes, the Company may arrange for
the purchase and conversion of any Notes not converted prior to the expiration
of such conversion right by an agreement with one or more investment bankers or
other purchasers to purchase such Notes by paying to the Trustee in trust for
the Noteholders, on or before the date fixed for redemption, an amount not less
than the applicable redemption price and interest accrued to the date fixed for
redemption, of such Notes. Notwithstanding anything to the contrary contained in
this Article III, the obligation of the Company to pay the redemption price of
such Notes and interest accrued to, but excluding, the date fixed for
redemption, shall be deemed to be satisfied and discharged to the extent such
amount is so paid by such purchasers to such Noteholders. If such an agreement
is entered into, a copy of which, certified as true and correct by the Secretary
or Assistant Secretary of the Company will be filed with the Trustee prior to
the date fixed for redemption, any Notes not duly surrendered for conversion by
the holders thereof may, at the option of the Company, be deemed, to the fullest
extent permitted by law, acquired by such purchasers from such holders and
(notwithstanding anything to the contrary contained in
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Article XV) surrendered by such purchasers for conversion, all as of immediately
prior to the close of business on the date fixed for redemption (and the right
to convert any such Notes shall be deemed to have been extended through such
time), subject to payment of the above amount as aforesaid. At the written
direction of the Company, the Trustee shall hold and dispose of any such amount
paid to it in the same manner as it would monies deposited with it by the
Company for the redemption of Notes. Without the Trustee's prior written
consent, no arrangement between the Company 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 Company agrees to indemnify the Trustee from, and hold
it harmless against, any loss, liability or expense arising out of or in
connection with any such arrangement for the purchase and conversion of any
Notes between the Company and such purchasers, including the costs and expenses
incurred by the Trustee in the defense of any claim or liability arising out of
or in connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture.
ARTICLE IV
SUBORDINATION
Section 4.1 Subordination to Senior Indebtedness
The Company covenants and agrees, and each holder of a Note, by his or
her acceptance thereof, likewise covenants and agrees, that all Notes shall be
issued subject to the provisions of this Article IV and to the extent and in the
manner hereinafter set forth in this Article IV, the indebtedness represented by
the Notes and the payment of the principal amount, Conversion Price, and
interest thereon, Holder Conversion Provisional Payment, redemption price for
Notes called for redemption in accordance with Section 3.01, the Repurchase
Price with respect to Notes submitted for repurchase in accordance with Section
16.1, liquidated damages, fees, expenses or any other amounts in respect of each
and all of the Notes are hereby expressly made subordinate and junior and
subject in right of payment to the prior payment in full in cash of all Senior
Indebtedness of the Company now outstanding or hereinafter incurred. "Senior
Indebtedness" means the principal of, and premium, if any, and interest on,
reimbursement obligations, fees, costs and expenses in connection with and other
amounts accrued or due on or in connection with (i) all indebtedness of the
Company for monies borrowed, including, without limitation, commercial paper and
accounts receivable sold or assigned by the Company, (ii) all obligations of the
Company evidenced by any notes, debentures, bonds or other instruments issued to
banks, trust companies, insurance companies, other financial institutions and
other entities that in the ordinary course of business make loans, (iii) all
obligations of the Company under any interest or currency swap agreements,
hedging agreements, cap, floor and collar agreements, spot and forward contracts
and other similar agreements, (iv) obligations in respect of letters of credit,
bank guarantees and bankers acceptances, (v) obligations of the Company as
lessee under leases of personal property (whether or not required to be
capitalized under GAAP), (vi) obligations secured by a mortgage, pledge,
security interest, lien or encumbrance affecting title to any of the Company's
assets, whether or not the Company is directly liable or has guaranteed such
obligations, (vii) obligations consisting of the balance of the deferred or
unpaid
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purchase price of assets, (viii) principal of, and interest on any indebtedness
or obligations of others of the kinds described in (i) through (viii) above
assumed or guaranteed in any manner by the Company, and (ix) deferrals,
renewals, increases, extensions, refinancings and refundings of, or amendments,
modifications, restatements or supplements to, any such indebtedness or
obligations described in (i) through (viii) above, in each case unless the
instrument creating or evidencing the same or pursuant to which the same is
outstanding expressly provides that the same is not senior in right of payment
to the Notes. Senior Indebtedness includes, with respect to the foregoing,
interest and expenses accruing on or after the filing of any petition in any
bankruptcy or similar proceeding or for reorganization relating to the Company,
whether or not such interest or expense is allowed in such proceeding.
Notwithstanding the foregoing, "Senior Indebtedness" with respect to any Note
shall not include (a) indebtedness of the Company evidenced by the other Notes,
which shall rank equally and ratably with such Note, (b) any obligation of the
Company to any Subsidiary or Affiliate of the Company, (c) any liability for
Federal, state, local or other taxes owed or owing by the Company, (d) any
accounts payable or other liability to trade creditors arising in the ordinary
course of business (including guarantees thereof or instruments evidencing such
liabilities), (e) any indebtedness or obligation of the Company (and any accrued
and unpaid interest in respect thereof) that by its terms is subordinate or
junior in right of payment to any other indebtedness or obligation of the
Company, (f) any obligation with respect to any shares, interest, rights to
purchase, warrants, options, participations or other equivalents of, or
interests in, the equity of the Company or any Subsidiary or Affiliate,
including any preferred stock or other preferred equity or (g) any indebtedness
or obligations incurred in violation of Section 5.10(i) hereof. For purposes of
this Section 4.1, all references to indebtedness or obligations of the Company
shall be deemed to include any such indebtedness or obligations of the
Subsidiaries.
Section 4.2 No Payment if Default in Senior Indebtedness
No payment on account of principal of, premium, if any, or interest on
the Notes (including, but not limited to, the redemption price for Notes called
for redemption in accordance with Section 3.01, the Repurchase Price with
respect to Notes submitted for repurchase in accordance with Section 16.1, the
Conversion Price, the Holder Conversion Provisional Payment and any other
payment payable with respect to the Notes pursuant to the provisions of this
Indenture) shall be made, and no Notes shall be redeemed or purchased directly
or indirectly by the Company (or any of its Subsidiaries), if at the time of
such payment or purchase or immediately after giving effect thereto, (i) a
default in the payment of principal, premium, if any, interest, rent or other
obligations in respect of any Senior Indebtedness occurs and is continuing (or,
in the case of Senior Indebtedness for which there is a period of grace, in the
event of such a default that continues beyond the period of grace, if any,
specified in the instrument or lease evidencing such Senior Indebtedness) (a
"Payment Default"), unless and until such Payment Default shall have been cured
or waived or shall have ceased to exist or (ii) the Company shall have received
notice (a "Payment Blockage Notice") from the holder or holders of Designated
Senior Debt or their Representative that there exists under such Designated
Senior Debt a default, which shall not have been cured or waived, permitting the
holder or holders thereof to declare such Designated Senior Debt due and
payable, but only for the period (the "Payment Blockage Period") commencing on
the date of receipt of the Payment Blockage Notice and ending on the earlier of
(a) the date such default shall have been cured or waived, or (b) the
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180th day immediately following the Company's receipt of such Payment Blockage
Notice. The Company shall resume payments on and distributions in respect of the
Notes, including any past scheduled payments of the principal of (and premium,
if any) and interest on such Notes to which the Holders of the Notes would have
been entitled but for the provisions of this Section 4.2 in the case of a
Payment Default, on the date upon which such Payment Default is cured or waived
or ceases to exist. In addition, notwithstanding clauses (i) and (ii), unless
the holders of Designated Senior Debt shall have accelerated the maturity of
such Designated Senior Debt or there is a Payment Default, the Company shall
resume payments on the Note after the end of each Payment Blockage Period. Not
more than one Payment Blockage Notice may be given in any consecutive 360-day
period, irrespective of the number of defaults with respect to Designated Senior
Debt during such period. Notwithstanding any other provision contained herein,
during all times in which the Senior Credit Facility is in effect or the lenders
thereunder have any obligations to make loans or extend credit to the Company or
any of its Subsidiaries, the only holder of Senior Indebtedness entitled to
exercise its rights under this Section 4.2 and Section 4.3(a) shall be the
Representative of the Senior Credit Facility.
Section 4.3 Payment upon Dissolution, Etc.
(a) In the event of any bankruptcy, insolvency,
reorganization, receivership, composition, assignment for benefit of
creditors or other similar proceeding initiated by or against the
Company or any dissolution or winding up or total or partial
liquidation or reorganization of the Company (being hereinafter
referred to as a "Proceeding"), each holder of a Note, by his or her
acceptance thereof, agrees that such holder shall, upon request of a
holder of Senior Indebtedness, and at such holder's own expense take
all reasonable actions (including but not limited to the execution and
filing of documents and the giving of testimony in any Proceeding,
whether or not such testimony could have been compelled by process)
necessary to prove the full amount of all their claims in any
Proceeding, and the Noteholders shall not waive any claim in any
Proceeding without the written consent of such Holder. If the Trustee
or the holder of a Note does not file a proper proof of claim or proof
of debt in the form required in any proceeding referred to in this
paragraph (a) of Section 4.3 at least thirty (30) days before the
expiration of the time to file such claim, the holders of any Senior
Indebtedness or their Representatives are hereby authorized to file an
appropriate claim for and on behalf of the holders of the Notes.
(b) The Trustee and the holders of the Notes shall retain the
right to vote and otherwise act with respect to the claims under their
Notes (including, without limitation, the right to vote to accept or
reject any plan of partial or complete liquidation, reorganization,
arrangement, composition or extension); provided that the Trustee or
any holder of the Notes shall not vote with respect to any such plan or
take any other action in any way so as to (i) contest the validity of
any Senior Credit Facility or any collateral therefor or guaranties
thereof, (ii) contest the relative rights and duties of any of the
lenders under or the Representatives of the Senior Credit Facility
established in any instruments or agreement creating or evidencing the
Senior Credit Facility with respect to
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any of such collateral or guaranties, or (iii) contest the Trustee's
and the Holders' obligations and agreements set forth in this Section
4.3.
(c) Upon payment or distribution to creditors in a Proceeding
of assets of the Company of any kind or character, whether in cash,
property or securities, all principal and interest due upon any Senior
Indebtedness shall first be paid in full before any Holders of the
Notes shall be entitled to receive or, if received, to retain any
payment or distribution on account of the Notes, and upon any such
Proceeding, any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities, to which
any Holders of the Notes would be entitled except for the provisions of
this Article IV shall be paid by the Company or by any receiver,
trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by any holders of the Notes who
shall have received such payment or distribution, directly to the
holders of the Senior Indebtedness (pro rata to each such holder on the
basis of the respective amounts of such Senior Indebtedness held by
such holder) or their representatives to the extent necessary to pay
all such Senior Indebtedness in full after giving effect to any
concurrent payment or distribution to or for the holders of such Senior
Indebtedness, before any payment or distribution is made to any holders
of the Notes.
Section 4.4 Payments on Notes
Subject to Section 4.3, the Company may make regularly scheduled
payments of the principal of, and any interest or premium on, the Notes, if at
the time of payment, and immediately after giving effect thereto, (i) there
exists no Payment Default or a Payment Blockage Period and (ii) the Company is
permitted to make payments under Section 4.3.
Section 4.5 Certain Conversions Deemed Payment
For the purposes of this Article IV only (a) the issuance and delivery
of junior securities upon conversion of Notes in accordance with Article XV
shall not be deemed to constitute a payment of distribution on account of the
principal of or interest on Notes or on account of the purchase or other
acquisition of Notes, and (b) the payment, issuance or delivery of cash (except
in satisfaction of fractional shares pursuant to Section 15.3), property or
securities (other than junior securities) upon conversion of a Note shall be
deemed to constitute payment on account of the principal of such Note. For the
purposes of this Section 4.5, the term "junior securities" means (i) shares of
any stock of any class of the Company, or (ii) securities of the Company which
are subordinated in right of payment to all Senior Indebtedness which may be
outstanding at the time of issuance or delivery of such securities to
substantially the same extent as, or to a greater extent than, the Notes are so
subordinated as provided in this Article IV. Nothing contained in this Article
IV or elsewhere in this Indenture or in the Notes is intended to or shall
impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the holders, the right, which is absolute and unconditional, of
the holder of any Note to convert such Note in accordance with Article XV.
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Section 4.6 Subrogation
Subject to payment in full in cash of all Senior Indebtedness, the
rights of the holders of the Notes shall be subrogated to the rights of the
holders of Senior Indebtedness to receive payments or distributions of the
assets of the Company made on such Senior Indebtedness until all principal and
interest on the Notes shall be paid in full in cash; and for purposes of such
subrogation, no payments or distributions to the holders of Senior Indebtedness
of any cash, property or securities to which any holders of the Notes would be
entitled except for the subordination provisions of this Article IV shall, as
between the holders of the Notes and the Company and/or its creditors other than
the holders of the Senior Indebtedness, be deemed to be a payment on account of
the Senior Indebtedness.
Section 4.7 Rights of Holders Unimpaired
The provisions of this Article IV are and are intended solely for the
purposes of defining the relative rights of the holders of the Notes and the
holders of Senior Indebtedness and nothing in this Article IV shall impair, as
between the Company and any holders of the Notes, the obligation of the Company,
which is unconditional and absolute, to pay to the holders of the Notes the
principal thereof (and premium, if any) and interest thereon, in accordance with
the terms of the Notes.
Section 4.8 Holders of Senior Indebtedness
These provisions regarding subordination will constitute a continuing
offer to all Persons who, in reliance upon such provisions, become holders of,
or continue to hold, Senior Indebtedness; such provisions are made for the
benefit of the holders of Senior Indebtedness, and such holders are hereby made
obligees under such provisions to the same extent as if they were named therein,
and they or any of them may proceed to enforce such subordination and no
amendment or modification of the provisions contained herein shall diminish the
rights of such holders unless such holders have agreed in writing thereto. The
holders of Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to any of the Noteholders, without incurring
responsibility to the Noteholders and without impairing or releasing the
subordination provisions of this Article IV, (i) increase the amount of, change
the manner, terms or place of payment of, or renew or alter, any Senior
Indebtedness, or otherwise amend, modify, restate or supplement the same, (ii)
sell, exchange or release any collateral mortgaged, pledged or otherwise
securing the Senior Indebtedness, (iii) release any Person liable in any manner
for the Senior Indebtedness and (iv) exercise or refrain from exercising any
rights against the Company or any other Person.
Section 4.9 Trustee Not Fiduciary for Holders of Senior Indebtedness
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holders if
the Trustee shall in good faith mistakenly pay over or distribute to Holders of
Notes or to the Company or to any other person cash, property or securities to
which any holders of Senior Indebtedness shall be entitled by virtue of this
Article IV or otherwise. With respect to the holders of Senior Indebtedness, no
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implied covenants or obligations with respect to holders of Senior Indebtedness
shall be read into this Indenture against the Trustee.
Section 4.10 Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article IV with respect to any Senior Indebtedness
which may at any time be held by it, to the same extent as any other holder of
Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee of
any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 8.6.
Section 4.11 Proceeds Held in Trust
In the event that notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities (including, without limitation, by way of setoff or
otherwise) prohibited by the provisions of Section 4.2 or Section 4.3 shall be
received by the Trustee of the holders of the Notes before all Senior
Indebtedness if paid in full in cash, such payment or distribution shall be held
in trust for the benefit of and shall be paid over or delivered to the holders
of Senior Indebtedness or their Representative or Representatives, as their
respective interests may appear, as calculated by the Company, for application
to, or to be held as collateral for, the payment of any Senior Indebtedness
remaining unpaid to the extent necessary to pay all Senior Indebtedness in full
in cash after giving effect to any concurrent payment or distribution to or for
the holders of such Senior Indebtedness.
Section 4.12. Blockage of Remedies.
During any Payment Default or any Payment Blockage Period, if an Event
of Default has occurred under this Indenture, neither the Trustee nor any of the
holders of the Notes will commence or join with any creditor of the Company or
any of its Subsidiaries in asserting or commencing any proceedings to collect or
enforce its rights hereunder or take any action to foreclose or realize upon the
indebtedness hereunder for a period beginning on the date of such Event of
Default and ending on the first to occur of (i) of the date that is 180 days
following the date of such Event of Default or (ii) the date such Payment
Default is cured, waived or ceases to exist or the date such Payment Blockage
Period ends, as the case may be.
Section 4.13. Prior Notice of Acceleration.
The holders of the Notes agree, solely for the benefit of the holders
of the Designated Senior Debt, not to declare the unpaid principal amount of any
Note to be due and payable pursuant to Section 8.01 unless the Representative of
the Designated Senior Debt shall have received not less than five (5) business
days' prior written notice from the Company or any holder of the Notes of such
declaration of acceleration. The Company, forthwith upon receipt of any such
declaration of acceleration, shall send a copy thereof to the Representative of
the Designated Senior Debt.
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ARTICLE V
PARTICULAR COVENANTS OF THE COMPANY
Section 5.1 Payment of Principal, Premium and Interest
The Company covenants and agrees that it will duly and punctually pay
or cause to be paid the principal of and premium, if any, and interest on each
of the Notes at the places, at the respective times and in the manner provided
herein and in the Notes. Liquidated Damages paid pursuant to Section 15.2, if
any, shall be paid within ten (10) Business Days of the date from which such
liquidated damages accrued pursuant to Section 15.2. Liquidated Damages on the
Notes paid pursuant to Section 2(f) of the Registration Rights Agreement, if
any, shall be paid at the times and in the manner provided therein. Each
installment of interest on the Notes due on any semi-annual interest payment
date may be paid by mailing checks for the interest payable to or upon the
written order of the holders of Notes entitled thereto as they shall appear on
the Note register, provided that, with respect to any holder of Notes with an
aggregate principal amount equal to or in excess of $500,000, at the request of
such holder in writing to the Company, interest on such holder's Notes shall be
paid by wire transfer in immediately available funds in accordance with the wire
transfer instructions supplied by such holder from time to time to the Trustee
and paying agent (if different from Trustee) at least five (5) Business Days
prior to the applicable record date.
Section 5.2 Maintenance of Office or Agency
The Company will maintain in the Borough of Manhattan, The City of New
York, an office or agency where the Notes may be presented for registration of
transfer or exchange or for presentation for payment or for conversion,
redemption or repurchase and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company will give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency not designated or appointed by the Trustee.
If at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office or the office or agency of the Trustee in the Borough of
Manhattan, The City of New York.
The Company 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
that no such designation or rescission shall in any manner relieve the Company
of its obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York, for such purposes. The Company 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.
The Company hereby initially designates the Trustee as paying agent,
Note registrar, Custodian and conversion agent and the Corporate Trust Office
and the office or agency of the Trustee in the Borough of Manhattan, The City of
New York (which initially shall be The Bank
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of New York, located at 101 Barclay Street, Floor 8W, New York, New York 10286,
Attention: Corporate Trust Administration), as one such office or agency of the
Company for each of the aforesaid purposes.
So long as the Trustee is the Note registrar, the Trustee agrees to
mail, or cause to be mailed, the notices set forth in Section 8.10(a) and the
third paragraph of Section 8.11.
Section 5.3 Appointments to Fill Vacancies in Trustee's Office
The Company, whenever necessary to avoid or fill a vacancy in the
office of Trustee, will appoint, in the manner provided in Section 8.10, a
Trustee, so that there shall at all times be a Trustee hereunder.
Section 5.4 Provisions as to Paying Agent
(a) If the Company shall appoint a paying agent other than the
Trustee or if the Trustee shall appoint such a paying agent, it will
cause such paying agent to execute and deliver to the Trustee an
instrument in which such agent shall agree with the Trustee, subject to
the provisions of this Section 5.4:
(1) that it will hold all sums held by it as such
agent for the payment of the principal of and premium, if any,
or interest (including Liquidated Damages, if any) on the
Notes (whether such sums have been paid to it by the Company
or by any other Person) in trust for the benefit of the
holders of the Notes;
(2) that it will give the Trustee notice of any
failure by the Company (or by any other Person) to make any
payment of the principal of and premium, if any, or interest
(including Liquidated Damages, if any) on the Notes when the
same shall be due and payable; and
(3) that at any time during the continuance of an
Event of Default, upon request of the Trustee, it will
forthwith pay to the Trustee all sums so held in trust.
The Company shall, on or before each due date of the principal
of, premium, if any, or interest on the Notes, deposit with the paying
agent a sum sufficient to pay such principal, premium, if any, or
interest, and (unless such paying agent is the Trustee) the Company
will promptly notify the Trustee of any failure to take such action,
provided that if such deposit is made on the due date, such deposit
must be received by the paying agent by 10:00 a.m., New York City time,
on such date.
(b) If the Company shall act as its own paying agent, it will,
on or before each due date of the principal of, premium, if any, or
interest (including Liquidated Damages, if any) on the Notes, set
aside, segregate and hold in trust for the benefit of the holders of
the Notes a sum sufficient to pay such principal, premium, if any, or
interest (including Liquidated Damages, if any) so becoming due and
will notify the Trustee of any failure to take such action and of any
failure by the Company (or any other Person) to make any
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payment of the principal of, premium, if any, or interest (including
Liquidated Damages, if any) on the Notes when the same shall become due
and payable.
(c) Anything in this Section 5.4 to the contrary
notwithstanding, the Company may, at any time, for the purpose of
obtaining a satisfaction and discharge of this Indenture, or for any
other reason, pay or cause to be paid to the Trustee all sums held in
trust by the Company or any paying agent hereunder as required by this
Section 5.4, such sums to be held by the Trustee upon the trusts herein
contained and upon such payment by the Company or any paying agent to
the Trustee, the Company or such paying agent shall be released from
all further liability with respect to such sums.
(d) Anything in this Section 5.4 to the contrary
notwithstanding, the agreement to hold sums in trust as provided in
this Section 5.4 is subject to Sections 13.3 and 13.4.
Section 5.5 Existence
Subject to Article XII, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence.
Section 5.6 Information Requirement
Within the period prior to the expiration of the holding period
applicable to sales thereof under Rule 144(k) under the Securities Act (or any
successor provision), the Company covenants and agrees that it shall, during any
period in which it is not subject to Section 13 or 15(d) under the Exchange Act,
make available to any holder or beneficial holder of Notes or any Common Stock
issued upon conversion thereof, in each case which continue to be Restricted
Securities, in connection with any sale thereof and any prospective purchaser of
Notes or such Common Stock from such holder or beneficial holder, the
information required pursuant to Rule 144A(d)(4) under the Securities Act upon
the request of any holder or beneficial holder of the Notes or such Common Stock
and it will take such further action as any holder or beneficial holder of such
Notes or such Common Stock may reasonably request in connection with
qualification of such sale for exemption from registration under Rule 144A.
Section 5.7 Stay, Extension and Usury Laws
The Company covenants (to the extent that it may lawfully do so) that
it shall 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 or other
law that would prohibit or forgive the Company from paying all or any portion of
the principal of or interest on the Notes as contemplated herein, wherever
enacted, now or at any time hereafter in force, or which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
it may lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not, 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.
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Section 5.8 Compliance Certificate
The Company shall deliver to the Trustee within one hundred twenty
(120) days after the end of each fiscal year of the Company (beginning with the
fiscal year ending on December 31, 2003) an Officer's Certificate, signed by the
principal executive, principal financial officer or accounting officer of the
Company, stating whether or not to the best of such person's knowledge the
signers know of any default or Event of Default that occurred during such
period. Such Officer's Certificate shall describe in reasonable detail the
default or Event of Default, if any, and its status.
The Company shall deliver to the Trustee, as soon as possible and in
any event within three (3) Business Days after the Company becomes aware of the
occurrence of any Event of Default or an event which, with notice or the lapse
of time or both, would constitute an Event of Default, an Officer's Certificate
setting forth the details of such Event of Default or default and the action
which the Company proposes to take with respect thereto.
Section 5.9 Further Instruments and Acts
Upon request of the Trustee, the Company will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purposes of this Indenture.
Section 5.10 Leverage Ratio Incurrence Test
The Company covenants and agrees that it will not incur, and will not
permit any of its Subsidiaries to incur, any additional LR Indebtedness at any
time after the date of this Indenture; provided, however, the Company may incur
additional LR Indebtedness from time to time thereafter if (i) the Leverage
Ratio is not greater than 3.5 to 1.0, after giving effect to the proposed
increase to LR Indebtedness, and (ii) the Company furnishes to the Trustee, as
soon as available, and in any event within fifteen (15) days of incurring such
additional LR Indebtedness, the Leverage Ratio Certificate, in the form attached
hereto as Exhibit B.
Section 5.11 Cash Distributions
The Company covenants and agrees that if the Company shall, by dividend
or otherwise, distribute to all holders of its Common Stock cash (excluding any
cash that is distributed upon a merger or consolidation to which Section 15.6
applies or as part of a distribution referred to in Section 15.5(d)), then the
Company shall also make such distribution on the same terms to the holders of
the Notes as of the record date for such distribution, and each holder of Notes
is to be treated for the purpose of this Section 5.11 as holding the greatest
whole number of shares of Common Stock issuable upon conversion pursuant to
Article XV of all Notes held by such holder as of the record date for such
distribution (the calculation of the greatest number of shares issuable shall be
made without regard to any limitation on the Noteholder's right to convert the
Notes into such shares).
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ARTICLE VI
NOTEHOLDERS' LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
Section 6.1 Noteholders Lists
The Company covenants and agrees that it will furnish or cause to be
furnished to the Trustee, semi-annually, not more than fifteen (15) days after
each June 1 and December 1 in each year beginning with December 1, 2003 and at
such other times as the Trustee may request in writing, within thirty (30) days
after receipt by the Company of any such request (or such lesser time as the
Trustee may reasonably request in order to enable it to timely provide any
notice to be provided by it hereunder), a list in such form as the Trustee may
reasonably require of the names and addresses of the holders of Notes as of a
date not more than fifteen (15) days (or such other date as the Trustee may
reasonably request in order to so provide any such notices) prior to the time
such information is furnished, except that no such list need be furnished so
long as the Trustee is acting as Note registrar.
Section 6.2 Preservation and Disclosure of Lists
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, all information as to the names and addresses of the holders of
Notes contained in the most recent list furnished to it as provided in Section
6.1 or maintained by the Trustee in its capacity as Note registrar, if so
acting. The Trustee may destroy any list furnished to it as provided in Section
6.1 upon receipt of a new list so furnished.
(b) The rights of Noteholders to communicate with other holders of
Notes with respect to their rights under this Indenture or under the Notes and
the corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Noteholder, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of holders of Notes made pursuant to the
Trust Indenture Act.
Section 6.3 Reports by Trustee
(a) After this Indenture has been qualified under the Trust Indenture
Act, the Trustee shall transmit to holders of Notes such reports concerning the
Trustee and its actions under this Indenture as may be required pursuant to the
Trust Indenture Act at the times and in the manner provided pursuant thereto. If
required by Section 313(a) of the Trust Indenture Act, the Trustee shall, within
sixty (60) days after each May 15 following the date of this Indenture deliver
to holders a brief report, dated as of such May 15 which complies with the
provisions of such Section 313(a).
(b) A copy of such report shall, at the time of such transmission to
holders of Notes, be filed by the Trustee with each stock exchange and automated
quotation system upon which the Notes are listed, if any, and with the Company.
The Company will promptly notify
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the Trustee as soon as practicable when the Notes are listed on any stock
exchange or automated quotation system and when any such listing is
discontinued.
Section 6.4 Reports by Company
(a) After this Indenture has been qualified under the Trust Indenture
Act, the Company shall file with the Trustee and the Commission, and transmit to
holders of Notes, such information, documents and other reports and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the
Trustee within fifteen (15) days after the same is so required to be filed with
the Commission.
(b) During any period in which the Company is not subject to Section 13
or 15(d) under the Exchange Act, the Company will deliver to the Trustee (a) as
soon as available and in any event within ninety (90) days after the end of each
fiscal year of the Company (i) a consolidated balance sheet of the Company and
its Subsidiaries as of the end of such fiscal year and the related consolidated
statements of operations, stockholders' equity and cash flows for such fiscal
year, all reported on by an independent public accountant of nationally
recognized standing and (ii) a report containing a management's discussion and
analysis of the financial condition and results of operations and a description
of the business and properties of the Company and (b) as soon as available and
in any event within forty-five (45) days after the end of each of the first
three quarters of each fiscal year of the Company (i) an unaudited consolidated
balance sheet of the Company and its Subsidiaries as of the end of such fiscal
quarter and the related consolidated statements of operations, stockholders'
equity and cash flows for such fiscal quarter and (ii) a report containing a
management's discussion and analysis of the financial condition and results of
operations of the Company for such quarter; provided that the foregoing
statements and reports shall not be required for any fiscal year or quarter, as
the case may be, with respect to which the Company files or expects to file with
the Trustee an annual report or quarterly report, as the case may be, pursuant
to the preceding paragraph of this Section 6.4. Delivery of such reports,
information and documents to the Trustee is for informational purposes only and
the Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officer's
Certificates).
ARTICLE VII
DEFAULTS AND REMEDIES
Section 7.1 Events of Default
In case one or more of the following Events of Default (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of
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law or pursuant to any judgment, decree or order of any court or any order, rule
or regulation of any administrative or governmental body) shall have occurred
and be continuing:
(a) default in the payment of the principal of and premium
(including, without limitation, the Holder Conversion Provisional
Payment), if any, on any of the Notes as and when the same shall become
due and payable either at maturity or in connection with any
conversion, redemption, by declaration or otherwise; or
(b) default for thirty (30) days in the payment of any
installment of interest or Liquidated Damages, if any, upon any of the
Notes as and when the same shall become due and payable; or
(c) failure by the Company to deliver shares of Common Stock
required to be delivered upon conversion of a Note in accordance with
Article XV within thirty (30) Business Days of such Conversion Date; or
(d) a default in the payment of the Repurchase Price in
respect of any Note on the repurchase date therefor in accordance with
the provisions of Article XVI; or
(e) failure on the part of the Company duly to observe or
perform any other of the covenants on the part of the Company in the
Notes or in this Indenture (other than default in performance of a
covenant that is specifically dealt with elsewhere in this Section)
including, without limitation, failure on the part of the Company to
provide a written notice of a Repurchase Event in accordance with
Section 16.2, and the continuance of such failure for a period of
thirty (30) days after the date on which written notice of such
failure, requiring the Company to remedy the same, shall have been
given to the Company by the Trustee, or to the Company and a
Responsible Officer of the Trustee by the holders of at least 20% in
aggregate principal amount of the outstanding Notes at the time
outstanding determined in accordance with Section 9.4; or
(f) failure on the part of the Company or any Significant
Subsidiary to make any payment at maturity, including any applicable
grace period, in respect of indebtedness of, or guaranteed or assumed
by, the Company or any Significant Subsidiary, in a principal amount
then outstanding in excess of U.S. $2,000,000, and the continuance of
such failure for a period of thirty (30) days after there shall have
been given, by registered or certified mail, to the Company by the
Trustee or to the Company and the Trustee by the holders of not less
than 20% in aggregate principal amount of the Notes then outstanding, a
written notice specifying such default and requiring the Company to
cause such default to be cured or waived and stating that such notice
is a "Notice of Default" hereunder; or
(g) default on the part of the Company or any Significant
Subsidiary with respect to any Indebtedness of, or guaranteed or
assumed by, the Company or any Significant Subsidiary, which default
results in the acceleration of indebtedness in a principal amount then
outstanding in excess of U.S. $2,000,000, and such indebtedness shall
not have been discharged or such acceleration shall not have been
rescinded or annulled for a period of thirty (30) days after there
shall have been given, by registered or certified mail, to the
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Company by the Trustee or to the Company and the Trustee by the holders
of not less than 20% in aggregate principal amount of the Notes then
outstanding, a written notice specifying such default and requiring the
Company to cause such indebtedness to be discharged or cause such
default to be cured or waived or such acceleration to be rescinded or
annulled and stating that such notice is a "Notice of Default"
hereunder; or
(h) the Company or any Significant Subsidiary shall commence a
voluntary case or other proceeding seeking liquidation, reorganization
or other relief with respect to itself or its debts under any
bankruptcy, insolvency or other similar law now or hereafter in effect
or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of
its property, or shall consent to any such relief or to the appointment
of or taking possession by any such official in an involuntary case or
other proceeding commenced against it, or shall make a general
assignment for the benefit of creditors, or shall fail generally to pay
its debts as they become due; or
(i) an involuntary case or other proceeding shall be commenced
against the Company or any Significant Subsidiary seeking liquidation,
reorganization or other relief with respect to it or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in
effect or seeking the appointment of a trustee, receiver, liquidator,
custodian or other similar official of it or any substantial part of
its property, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of sixty (60) consecutive
days; or
(j) any of the representations or warranties made by the
Company herein or in the Transaction Documents shall be false or
misleading in any material respect at the time made and such condition
(to the extent capable of being cured) shall continue uncured for a
period of ten (10) Business Days after there shall have been given, by
registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the holders of not less than 20% in
aggregate principal amount of the Notes then outstanding, a written
notice specifying such default and requiring the Company to cause such
default to be cured or waived and stating that such notice is a "Notice
of Default" hereunder; or
(k) the Company shall fail to duly observe or perform any of
the covenants on the part of the Company in the Transaction Documents
(other than the Notes and this Indenture), and such failure shall
continue for thirty (30) days after there shall have been given, by
registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the holders of not less than 20% in
aggregate principal amount of the Notes then outstanding, a written
notice specifying such default and requiring the Company to cause such
default to be cured or waived and stating that such notice is a "Notice
of Default" hereunder;
then, and in each and every such case (other than an Event of Default specified
in Section 7.1(h) or (i) with respect to the Company), unless the principal of
all of the Notes shall have already become due and payable, either the Trustee
or the holders of not less than 20% in aggregate principal amount of the Notes
then outstanding hereunder determined in accordance with Section 9.4, by notice
in writing to the Company (and to the Trustee if given by Noteholders),
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may declare the principal of and premium, if any, on all the Notes and the
interest accrued thereon (including Liquidated Damages to the extent accrued and
unpaid) to be due and payable immediately, and upon any such declaration the
same shall become and shall be immediately due and payable, anything in this
Indenture or in the Notes contained to the contrary notwithstanding. If an Event
of Default specified in Section 7.1(h) or (i) occurs and is continuing with
respect to the Company, the principal of all the Notes and the interest accrued
thereon (including Liquidated Damages to the extent accrued and unpaid) shall be
immediately due and payable. In addition to the foregoing, on the thirty-first
(31st) day after the occurrence of an Event of Default and during the
continuance of such Event of Default, the rate of interest on the Notes shall,
to the maximum extent permitted by law, be increased by five percent (5%) per
annum (i.e., from 5.0% to 10.0% per annum). Any such interest which is not paid
when due shall, to the maximum extent permitted by law, accrue interest until
paid at the rate from time to time applicable to the principal of the Notes.
Notwithstanding the foregoing if, at any time after the principal of the Notes
shall have been so declared due and payable, and before any judgment or decree
for the payment of the monies due shall have been obtained or entered as
hereinafter provided, the Company shall pay or shall deposit with the Trustee a
sum sufficient to pay all matured installments of interest upon all Notes and
the principal of and premium, if any, on any and all Notes which shall have
become due otherwise than by acceleration (with interest on overdue installments
of interest (to the extent that payment of such interest is enforceable under
applicable law) and on such principal and premium, if any, at the rate borne by
the Notes, to the date of such payment or deposit) and amounts due to the
Trustee pursuant to Section 8.6, and if any and all defaults under this
Indenture, other than the nonpayment of principal of and premium, if any, and
accrued interest on Notes which shall have become due by acceleration, shall
have been cured or waived pursuant to Section 7.7, then and in every such case
the holders of a majority in aggregate principal amount of the Notes then
outstanding, by written notice to the Company and to the Trustee, may waive all
defaults or Events of Default and rescind and annul such acceleration and its
consequences; but no such waiver or rescission and annulment shall extend to or
shall affect any subsequent default or Event of Default, or shall impair any
right consequent thereon. The Company shall notify the Responsible Officer of
the Trustee, within two (2) Business Days of becoming aware thereof, of any
default or Event of Default and shall deliver to the Trustee a statement
specifying such default or Event of Default and the action the Company has
taken, is taking or proposes to take with respect thereto.
In case the Trustee shall have proceeded to enforce any right under
this Indenture and such proceedings shall have been discontinued or abandoned
because of such waiver or rescission and annulment or for any other reason or
shall have been determined adversely to the Trustee, then and in every such case
the Company, the holders of Notes, and the Trustee shall be restored
respectively to their several positions and rights hereunder, and all rights,
remedies and powers of the Company, the holders of Notes, and the Trustee shall
continue as though no such proceeding had been instituted.
Section 7.2 Payments of Notes on Default; Suit Therefor
The Company covenants that (a) in case default shall be made in the
payment by the Company of any installment of interest upon any of the Notes as
and when the same shall become due and payable, and such default shall have
continued for a period of thirty (30) days,
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or (b) in case default shall be made in the payment of the principal of or
premium, if any, on any of the Notes as and when the same shall have become due
and payable, whether at maturity of the Notes or in connection with any
redemption or repurchase, by declaration under this Indenture or otherwise,
then, upon demand of the Trustee, the Company will pay to the Trustee, for the
benefit of the holders of the Notes, the whole amount that then shall have
become due and payable on all such Notes for principal and premium, if any, or
interest, or both, as the case may be, with interest upon the overdue principal
and premium, if any, and (to the extent that payment of such interest is
enforceable under applicable law) upon the overdue installments of interest at
the rate borne by the Notes; and, in addition thereto, such further amount as
shall be sufficient to cover the costs and expenses of collection, including
reasonable compensation to the Trustee, its agents, attorneys and counsel, and
any expenses or liabilities incurred by the Trustee hereunder other than through
its negligence or bad faith. Until such demand by the Trustee, the Company may
pay the principal of and premium, if any, and interest on the Notes to the
registered holders, whether or not the Notes are overdue.
In case the Company shall fail forthwith to pay such amounts upon such
demand, the Trustee, in its own name and as trustee of an express trust, shall
be entitled and empowered to institute any actions or proceedings at law or in
equity for the collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may enforce any such
judgment or final decree against the Company or any other obligor on the Notes
and collect in the manner provided by law out of the property of the Company or
any other obligor on the Notes wherever situated the monies adjudged or decreed
to be payable.
In case there shall be pending proceedings for the bankruptcy or for
the reorganization of the Company or any other obligor on the Notes under Title
11 of the United States Code, or any other applicable law, or in case a
receiver, assignee or trustee in bankruptcy or reorganization, liquidator,
sequestrator or similar official shall have been appointed for or taken
possession of the Company or such other obligor, the property of the Company or
such other obligor, 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
pursuant to the provisions of this Section 7.2, shall be entitled and empowered,
by intervention in such proceedings or otherwise, to file and prove a claim or
claims for the whole amount of principal, premium, if any, and interest
(including Liquidated Damages, if any) owing and unpaid in respect of the Notes,
and, in case of any judicial proceedings, to file such proofs of claim and other
papers or documents and to take such other actions as it may deem necessary or
advisable in order to have the claims of the Trustee and of the Noteholders
allowed in such judicial proceedings relative to the Company or any other
obligor on the Notes, its or their creditors, or its or their property, and to
collect and receive any monies or other property payable or deliverable on any
such claims, and to distribute the same after the deduction of any amounts due
the Trustee under Section 8.6; and any receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, custodian or similar official is
hereby authorized by each of the Noteholders 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 Noteholders, to pay to the Trustee any amount due it
for reasonable compensation, expenses, advances and disbursements, including
agents and counsel fees incurred by it up to the date of such distribution. To
the extent that such payment of reasonable compensation, expenses, advances and
disbursements out of the
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estate in any such proceedings shall be denied for any reason, payment of the
same shall be secured by a lien on, and shall be paid out of, any and all
distributions, dividends, monies, securities and other property which the
holders of the Notes may be entitled to receive in such proceedings, whether in
liquidation or under any plan of reorganization or arrangement or otherwise.
All rights of action and of asserting claims under this Indenture, or
under any of the Notes, may be enforced by the Trustee without the possession of
any of the Notes, or the production thereof on any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the holders of the Notes.
In any proceedings brought by the Trustee (and in any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party) the Trustee shall be held to represent all the holders
of the Notes, and it shall not be necessary to make any holders of the Notes
parties to any such proceedings.
Section 7.3 Application of Monies Collected by Trustee
Any monies collected by the Trustee pursuant to this Article VII shall
be applied in the following order, at the date or dates fixed by the Trustee for
the distribution of such monies, upon presentation of the several Notes, and
stamping thereon the payment, if only partially paid, and upon surrender
thereof, if fully paid:
First: To the payment of all amounts due the Trustee under
Section 8.6;
Second: To the holders of Senior Indebtedness to the extent
required by Article IV;
Third: In case the principal of the outstanding Notes shall
not have become due and be unpaid, to the payment of interest on the
Notes in default in the order of the maturity of the installments of
such interest, with interest (to the extent that such interest has been
collected by the Trustee) upon the overdue installments of interest at
the rate borne by the Notes, such payments to be made ratably to the
Persons entitled thereto;
Fourth: In case the principal of the outstanding Notes shall
have become due, by declaration or otherwise, and be unpaid, to the
payment of the whole amount then owing and unpaid upon the Notes for
principal and premium, if any, and interest, with interest on the
overdue principal and premium, if any, and (to the extent that such
interest has been collected by the Trustee) upon overdue installments
of interest at the rate borne by the Notes; and in case such monies
shall be insufficient to pay in full the whole amounts so due and
unpaid upon the Notes, then to the payment of such principal and
premium, if any, and interest without preference or priority of
principal and premium, if any, over interest, or of interest over
principal and premium, if any, or of any installment of interest over
any other installment of interest, or of any Note over any other Note,
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ratably to the aggregate of such principal and premium, if any, and
accrued and unpaid interest; and
Fifth: To the payment of the remainder, if any, to the
Company.
Section 7.4 Proceedings by Noteholder
Subject to the last two paragraphs of this Section 7.4, no holder of
any Note shall have any right by virtue of or by availing of any provision of
this Indenture to institute any suit, action or proceeding in equity or at law
upon or under or with respect to this Indenture, or for the appointment of a
receiver, trustee, liquidator, custodian or other similar official, or for any
other remedy hereunder, unless such holder previously shall have given to the
Trustee written notice of an Event of Default and of the continuance thereof, as
hereinbefore provided, and unless also the holders of not less than 20% in
aggregate principal amount of the Notes then outstanding shall have made written
request upon the Trustee to institute such action, suit or proceeding in its own
name as Trustee hereunder and shall have offered to the Trustee such indemnity
as may be reasonably satisfactory to the Trustee against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee for sixty (60)
days after its receipt of such notice, request and offer of indemnity, shall
have neglected or refused to institute any such action, suit or proceeding and
no direction inconsistent with such written request shall have been given to the
Trustee pursuant to Section 7.7; it being understood and intended, and being
expressly covenanted by the taker and holder of every Note with every other
taker and holder and the Trustee, that no one or more holders of Notes shall
have any right in any manner whatever by virtue of or by availing of any
provision of this Indenture to affect, disturb or prejudice the rights of any
other holder of Notes, or to obtain or seek to obtain priority over or
preference to any other such holder, or to enforce any right under this
Indenture, except in the manner herein provided and for the equal, ratable and
common benefit of all holders of Notes (except as otherwise provided herein).
For the protection and enforcement of this Section 7.4, each and every
Noteholder and the Trustee shall be entitled to such relief as can be given
either at law or in equity.
Notwithstanding any other provision of this Indenture and any provision
of any Note, the right of any holder of any Note to receive payment of the
principal of and premium, if any, and interest (including Liquidated Damages to
the extent accrued but unpaid) on such Note, on or after the respective due
dates expressed in such Note, or to institute suit for the enforcement of any
such payment on or after such respective dates against the Company shall not be
impaired or affected without the consent of such holder.
Anything in this Indenture or the Notes to the contrary
notwithstanding, the holder of any Note, without the consent of either the
Trustee or the holder of any other Note, in his own behalf and for his own
benefit, may enforce, and may institute and maintain any proceeding suitable to
enforce, such holder's rights of conversion as provided herein.
Section 7.5 Proceedings by Trustee
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial
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proceedings as the Trustee shall deem most effectual to protect and enforce any
of such rights, either by suit in equity or by action at law or by proceeding in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.
Section 7.6 Remedies Cumulative and Continuing
Except as provided in the last paragraph of Section 2.6, all powers and
remedies given by this Article VII to the Trustee or to the Noteholders shall,
to the extent permitted by law, be deemed cumulative and not exclusive of any
thereof or of any other powers and remedies available to the Trustee or the
holders of the Notes, by judicial proceedings or otherwise, to enforce the
performance or observance of the covenants and agreements contained in this
Indenture, and no delay or omission of the Trustee or of any holder of any of
the Notes to exercise any right or power accruing upon any default or Event of
Default occurring and continuing as aforesaid shall impair any such right or
power, or shall be construed to be a waiver of any such default or any
acquiescence therein; and, subject to the provisions of Section 7.4, every power
and remedy given by this Article VII or by law to the Trustee or to the
Noteholders may be exercised from time to time, and as often as shall be deemed
expedient, by the Trustee or by the Noteholders.
Section 7.7 Direction of Proceedings and Waiver of Defaults by Majority
of Noteholders
The holders of a majority in aggregate principal amount of the Notes at
the time outstanding determined in accordance with Section 9.4 shall have the
right to direct the time, method, and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on
the Trustee; provided, however, that (a) such direction shall not be in conflict
with any rule of law or with this Indenture, and (b) the Trustee may take any
other action deemed proper by the Trustee which is not inconsistent with such
direction. The holders of not less than a majority in aggregate principal amount
of the Notes at the time outstanding determined in accordance with Section 9.4
may on behalf of the holders of all of the Notes waive any past default or Event
of Default hereunder and its consequences except (i) a default in the payment of
interest or premium, if any, on, or the principal of, the Notes when due, (ii) a
failure by the Company to convert any Notes into Common Stock or (iii) a default
in respect of a covenant or provisions hereof which under Article XI cannot be
modified or amended without the consent of all affected holders of Notes then
outstanding. Upon any such waiver the Company, the Trustee and the holders of
the Notes shall be restored to their former positions and rights hereunder; said
default or Event of Default shall for all purposes of the Notes and this
Indenture be deemed to have been cured and to be not continuing; but no such
waiver shall extend to any subsequent or other default or Event of Default or
impair any right consequent thereon.
Section 7.8 Notice of Defaults
The Trustee shall, within ninety (90) days after the Trustee obtains
knowledge of the occurrence of a default, mail to all Noteholders, as the names
and addresses of such holders
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appear upon the Note register, notice of all defaults actually known to a
Responsible Officer, unless such defaults shall have been cured or waived before
the giving of such notice; and provided that, except in the case of default in
the payment of the principal of, or premium, if any, or interest (including
Liquidated Damages to the extent accrued but unpaid) on any of the Notes,
including without limiting the generality of the foregoing any default in the
payment of any Repurchase Price or in the payment of any amount due in
connection with any redemption of Notes, then in any such event the Trustee
shall be protected in withholding such notice if and so long as a trust
committee of directors and/or Responsible Officers of the Trustee in good faith
determine that the withholding of such notice is in the interests of the
Noteholders.
Section 7.9 Undertaking to Pay Costs
All parties to this Indenture agree, and each holder of any Note by his
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 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 and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant;
provided that the provisions of this Section 7.9 shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Noteholder, or group of
Noteholders, holding in the aggregate more than 25% in principal amount of the
Notes at the time outstanding determined in accordance with Section 9.4, or to
any suit instituted by any Noteholder for the enforcement of the payment of the
principal of or premium, if any, or interest (including Liquidated Damages to
the extent accrued but unpaid) on any Note (including, but not limited to, the
redemption price or Repurchase Price with respect to the Notes being redeemed or
repurchased as provided in this Indenture) on or after the due date expressed in
such Note or to any suit for the enforcement of the right to convert any Note in
accordance with the provisions of Article XV.
Section 7.10 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 VII 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.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.1 Duties and Responsibilities of Trustee
The Trustee, prior to the occurrence of an Event of Default and after
the curing or waiver of all Events of Default that may have occurred, undertakes
to perform such duties and only such
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duties as are specifically set forth in this Indenture and the Trust Indenture
Act. In case an Event of Default has occurred (which has not been cured or
waived) the Trustee shall exercise such of the rights and powers vested in it by
this Indenture, and use the same degree of care and skill in their exercise, as
a prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct, except that
(a) prior to the occurrence of an Event of Default and after
the curing or waiving of all Events of Default that may have occurred:
(1) the duties and obligations of the Trustee shall
be determined solely by the Trust Indenture Act and the
express provisions of this Indenture, and the Trustee shall
not be liable except for the performance of such duties and
obligations as are specifically set forth in this Indenture
and no implied covenants or obligations shall be read into
this Indenture and the Trust Indenture Act against the
Trustee; and
(2) in the absence of bad faith or willful misconduct
on the part of the Trustee, the Trustee may conclusively rely,
as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Trustee and conforming to the requirements of
this Indenture; provided, however, in the case of any such
certificates or opinions that by any provisions hereof are
specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Indenture;
(b) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer or Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in
ascertaining the pertinent facts;
(c) the Trustee shall not be liable to any Noteholder with
respect to any action taken or omitted to be taken by it in good faith
in accordance with the direction of the holders of not less than a
majority in principal amount of the Notes at the time outstanding
determined as provided in Section 9.4 relating to the time, method and
place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Indenture; and
(d) whether or not therein provided, every provision of this
Indenture relating to the conduct or affecting the liability of, or
affording protection to, the Trustee shall be subject to the provisions
of this Section.
None of the provisions contained in this Indenture shall
require the Trustee to expend or risk its own funds or otherwise incur personal
financial liability in the performance of any of its duties or in the exercise
of any of its rights or powers, if there is reasonable ground for
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believing that the repayment of such funds or adequate indemnity against such
risk or liability is not reasonably assured to it.
Section 8.2 Reliance on Documents, Opinions, Etc.
Except as otherwise provided in Section 8.1:
(a) the Trustee may conclusively rely and shall be protected
in acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, bond, note, coupon or
other paper or document believed by it in good faith to be genuine and
to have been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the Company
mentioned herein shall be sufficiently evidenced by an Officer's
Certificate (unless other evidence in respect thereof be herein
specifically prescribed) and any resolution of the Board of Directors
may be evidenced to the Trustee by a copy thereof certified by the
Secretary or an Assistant Secretary of the Company;
(c) the Trustee may consult with counsel of its selection, and
any advice of such counsel or Opinion of Counsel as to matters of law
shall be full and complete authorization and protection in respect of
any action taken or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel if such counsel was
selected with due care;
(d) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request,
order or direction of any of the Noteholders pursuant to the provisions
of this Indenture, unless such Noteholders shall have offered to the
Trustee security or indemnity reasonably satisfactory to it against the
costs, expenses and liabilities which may be incurred therein or
thereby;
(e) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture or other paper or document, but the
Trustee, in its reasonable discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation,
it shall be entitled to examine the books, records and premises of the
Company, personally or by agent or attorney; provided, however, that if
the payment within a reasonable time to the Trustee of the costs,
expenses or liabilities likely to be incurred by it in the making of
such investigation is, in the opinion of the Trustee, not reasonably
assured to the Trustee by the security afforded to it by the terms of
this Indenture, the Trustee may require indemnity reasonably
satisfactory to the Trustee from the Noteholders against such expenses
or liability as a condition to so proceeding; the reasonable expenses
of every such examination shall be paid by the Company or, if paid by
the Trustee or any predecessor Trustee, shall be repaid by the Company
upon demand;
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(f) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed by it with due care hereunder;
(g) the Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably
believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture;
(h) the Trustee shall not be deemed to have notice of any
default or Event of Default unless a Responsible Officer of the Trustee
has actual knowledge thereof or unless written notice of any event
which is in fact such a default or Event of Default is received by the
Trustee at the Corporate Trust Office of the Trustee, and such notice
references the Notes and this Indenture;
(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 to each agent,
custodian and other Person employed to act hereunder; and
(j) the Trustee may request that the Company deliver an
Officer's Certificate setting forth the names of individuals and/or
titles of officers authorized at such time to take specified actions
pursuant to this Indenture, which Officer's Certificate may be signed
by any person authorized to sign an Officer's Certificate, including
any person specified as so authorized in any such certificate
previously delivered and not superseded.
In no event shall the Trustee be liable for any consequential loss or damage of
any kind whatsoever (including but not limited to lost profits), even if the
Trustee has been advised of the likelihood of such loss or damage and regardless
of the form of action unless such loss or damage results from the Trustee's
willful misconduct or gross negligence.
Section 8.3 No Responsibility for Recitals, Etc.
The recitals contained herein and in the Notes (except in the Trustee's
certificate of authentication) shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for the correctness of the same. The
Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Notes. The Trustee shall not be accountable for the use or
application by the Company of any Notes or the proceeds of any Notes
authenticated and delivered by the Trustee in conformity with the provisions of
this Indenture.
Section 8.4 Trustee, Paying Agents, Conversion Agents or Registrar May
Own Notes
The Trustee, any paying agent, any conversion agent or Note registrar,
in its individual or any other capacity, may become the owner or pledgee of
Notes with the same rights it would have if it were not Trustee, paying agent,
conversion agent or Note registrar.
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Section 8.5 Monies to be Held in Trust
Subject to the provisions of Section 13.4, all monies received by the
Trustee shall, until used or applied as herein provided, be held in trust for
the purposes for which they were received. Money held by the Trustee in trust
hereunder need not be segregated from other funds except to the extent required
by law. The Trustee shall be under no liability for interest on any money
received by it hereunder except as may be agreed in writing from time to time by
the Company and the Trustee.
Section 8.6 Compensation and Expenses of Trustee
The Company covenants and agrees to pay to the Trustee from time to
time, and the Trustee shall be entitled to, such compensation as the Company and
the Trustee shall from time to time agree in writing for all services rendered
by it hereunder in any capacity (which shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust), and the
Company will pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances reasonably incurred or made by the Trustee
in accordance with any of the provisions of this Indenture (including the
reasonable compensation and the expenses and disbursements of its agents and
counsel and of all Persons not regularly in its employ) except any such expense,
disbursement or advance as may arise from its negligence, willful misconduct or
bad faith. The Company also covenants to indemnify the Trustee or any
predecessor Trustee in any capacity under this Indenture and its agents and any
authenticating agent for, and to hold them harmless against, any and all loss,
damages, claims, liability or expense, including taxes (other than those based
upon, measured by or determined by the income of the Trustee), incurred without
negligence, willful misconduct or bad faith on the part of the Trustee or such
agent or authenticating agent, as the case may be, and arising out of or in
connection with the acceptance or administration of this trust or in any other
capacity hereunder, including the costs and expenses of defending themselves
against any claim (whether asserted by the Company, a Holder or any other
Person) of liability in the premises. The obligations of the Company under this
Section 8.6 to compensate or indemnify the Trustee and to pay or reimburse the
Trustee for expenses, disbursements and advances shall be secured by a lien upon
all property and funds held or collected by the Trustee as such, except, subject
to the effect of Sections 4.3 and 7.5, funds held in trust herewith for the
benefit of the holders of particular Notes prior to the date of the accrual of
such unpaid compensation or indemnifiable claim. The obligation of the Company
under this Section 8.6 shall survive the satisfaction and discharge of this
Indenture and the resignation or removal of the Trustee. The indemnification
provided in this Section 8.6 shall extend to the officers, directors, agents and
employees of the Trustee.
When the Trustee and its agents and any authenticating agent incur
expenses or render services after an Event of Default specified in Section
7.1(i) or (j) occurs, the expenses and the compensation for the services are
intended to constitute expenses of administration under any bankruptcy,
insolvency or similar laws.
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Section 8.7 Officer's Certificate as Evidence
Except as otherwise provided in Section 8.1, whenever in the
administration of the provisions of this Indenture the Trustee shall deem it
necessary or desirable that a matter be proved or established prior to taking or
omitting any action hereunder, such matter (unless other evidence in respect
thereof be herein specifically prescribed) may, in the absence of negligence,
willful misconduct, recklessness or bad faith on the part of the Trustee, be
deemed to be conclusively proved and established by an Officer's Certificate
delivered to the Trustee, and such Officer's Certificate, in the absence of
negligence, willful misconduct, recklessness or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action taken or omitted by
it under the provisions of this Indenture upon the faith thereof.
Section 8.8 Conflicting Interests of Trustee
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
Section 8.9 Eligibility of Trustee
There shall at all times be a Trustee hereunder that shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such and has a
combined capital and surplus (together with its corporate parent) of at least
$50,000,000. If such Person publishes reports of condition at least annually,
pursuant to law or to the requirements of any supervising or examining
authority, then for the purposes of this Section 8.9, the combined capital and
surplus of such Person shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. If at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section 8.9, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article VIII.
Section 8.10 Resignation or Removal of Trustee
(a) The Trustee may at any time resign by giving written
notice of such resignation to the Company and by mailing notice thereof
to the holders of Notes at their addresses as they shall appear on the
Note register. Upon receiving such notice of resignation, the Company
shall promptly appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of
which instrument shall be delivered to the resigning Trustee and one
copy to the successor trustee. If no successor trustee shall have been
so appointed and have accepted appointment sixty (60) days after the
mailing of such notice of resignation to the Noteholders, the resigning
Trustee may, at the expense of the Company, petition any court of
competent jurisdiction for the appointment of a successor trustee, or
any Noteholder who has been a bona fide holder of a Note or Notes for
at least six months may, subject to the provisions of Section 7.9, on
behalf of himself and all others similarly situated, petition any such
court for the appointment of a successor trustee. Such court
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may thereupon, after such notice, if any, as it may deem proper and
prescribe, appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(1) the Trustee shall fail to comply with Section 8.8
within a reasonable time after written request therefor by the
Company or by any Noteholder who has been a bona fide holder
of a Note or Notes for at least six months, or
(2) the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.9 and shall fail
to resign after written request therefor by the Company or by
any such Noteholder, or
(3) the Trustee shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or a receiver of
the Trustee or of its property shall be appointed, or any
public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, the Company may by a Board Resolution remove
the Trustee and appoint a successor trustee by written instrument, in
duplicate, executed by order of the Board of Directors, one copy of
which instrument shall be delivered to the Trustee so removed and one
copy to the successor trustee, or, subject to the provisions of Section
7.9, any Noteholder who has been a bona fide holder of a Note or Notes
for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor trustee.
Such court may thereupon, after such notice, if any, as it may deem
proper and prescribe, remove the Trustee and appoint a successor
trustee.
(c) The holders of a majority in aggregate principal amount of
the Notes at the time outstanding may at any time remove the Trustee
and nominate a successor trustee which shall be deemed appointed as
successor trustee unless within ten (10) days after notice to the
Company of such nomination the Company objects thereto, in which case
the Trustee so removed or any Noteholder, upon the terms and conditions
and otherwise as in Section 8.10(a) provided, may, at the expense of
the Company, petition any court of competent jurisdiction for an
appointment of a successor trustee.
(d) Any resignation or removal of the Trustee and appointment
of a successor trustee pursuant to any of the provisions of this
Section 8.10 shall become effective upon acceptance of appointment by
the successor trustee as provided in Section 8.11.
(e) If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the
giving of such notice of removal, the Trustee being removed may
petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee with respect to
the Securities of such series.
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Section 8.11 Acceptance by Successor Trustee
Any successor trustee appointed as provided in Section 8.10 shall
execute, acknowledge and deliver to the Company and to its predecessor trustee
an instrument accepting such appointment hereunder, and thereupon the
resignation or removal of the predecessor trustee shall become effective and
such successor trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as trustee
herein; but, nevertheless, on the written request of the Company or of the
successor trustee, the trustee ceasing to act shall, upon payment of any amounts
then due it pursuant to the provisions of Section 8.6, execute and deliver an
instrument transferring to such successor trustee all the rights and powers of
the trustee so ceasing to act. Upon request of any such successor trustee, the
Company shall execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor trustee all such rights
and powers. Any trustee ceasing to act shall, nevertheless, retain a lien upon
all property and funds held or collected by such trustee as such, except for
funds held in trust for the benefit of holders of particular Notes, to secure
any amounts then due it pursuant to the provisions of Section 8.6.
No successor trustee shall accept appointment as provided in this
Section 8.11 unless at the time of such acceptance such successor trustee shall
be qualified under the provisions of Section 8.8 and be eligible under the
provisions of Section 8.9.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.11, each of the Company and the former trustee shall mail or
cause to be mailed notice of the succession of such trustee hereunder to the
holders of Notes at their addresses as they shall appear on the Note register.
If the Company fails to mail such notice within ten (10) days after acceptance
of appointment by the successor trustee, the successor trustee shall cause such
notice to be mailed at the expense of the Company.
Section 8.12 Succession by Merger, Etc.
Any corporation or other entity into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation or other entity succeeding to all or substantially all
of the corporate trust business of the Trustee (including the trust created by
this Indenture), shall be the successor to the Trustee hereunder without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that in the case of any corporation succeeding to all
or substantially all of the corporate trust business of the Trustee such
corporation shall be qualified under the provisions of Section 8.8 and eligible
under the provisions of Section 8.9.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture, any of the Notes shall have been authenticated
but not delivered, any such successor to the Trustee may adopt the certificate
of authentication of any predecessor trustee or authenticating agent appointed
by such predecessor trustee, and deliver such Notes so authenticated; and in
case at that time any of the Notes shall not have been authenticated, any
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successor to the Trustee or an authenticating agent appointed by such successor
trustee may authenticate such Notes either in the name of any predecessor
trustee hereunder or in the name of the successor trustee; and in all such cases
such certificates shall have the full force which it is anywhere in the Notes or
in this Indenture provided that the certificate of the Trustee shall have;
provided, however, that the right to adopt the certificate of authentication of
any predecessor Trustee or to authenticate Notes in the name of any predecessor
Trustee shall apply only to its successor or successors by merger, conversion or
consolidation.
Section 8.13 Limitation on Rights of Trustee as Creditor
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Notes), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of the claims
against the Company (or any such other obligor).
ARTICLE IX
CONCERNING THE NOTEHOLDERS
Section 9.1 Action by Noteholders
Whenever in this Indenture it is provided that the holders of a
specified percentage in aggregate principal amount of the Notes may take any
action (including the making of any demand or request, the giving of any notice,
consent or waiver or the taking of any other action), the fact that at the time
of taking any such action, the holders of such specified percentage have joined
therein may be evidenced (a) by any instrument or any number of instruments of
similar tenor executed by Noteholders in person or by agent or proxy appointed
in writing, or (b) by the record of the holders of Notes voting in favor thereof
at any meeting of Noteholders duly called and held in accordance with the
provisions of Article X, or (c) by a combination of such instrument or
instruments and any such record of such a meeting of Noteholders. Whenever the
Company or the Trustee solicits the taking of any action by the holders of the
Notes, the Company or the Trustee may fix in advance of such solicitation, a
date as the record date for determining holders entitled to take such action.
The record date shall be not more than fifteen (15) days prior to the date of
commencement of solicitation of such action.
Section 9.2 Proof of Execution by Noteholders
Subject to the provisions of Sections 8.1, 8.2 and 10.5, proof of the
execution of any instrument by a Noteholder or his agent or proxy shall be
sufficient if made in accordance with such reasonable rules and regulations as
may be prescribed by the Trustee or in such manner as shall be satisfactory to
the Trustee. The holding of Notes shall be proved by the Note register or by a
certificate of the Note registrar. The record of any Noteholders' meeting shall
be proved in the manner provided in Section 10.6.
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Section 9.3 Who Are Deemed Absolute Owners
The Company, the Trustee, any authenticating agent, any paying agent,
any conversion agent and any Note registrar may deem the Person in whose name
such Note shall be registered upon the Note register to be, and may treat him
as, the absolute owner of such Note (whether or not such Note shall be overdue
and notwithstanding any notation of ownership or other writing thereon) for the
purpose of receiving payment of or on account of the principal of, premium, if
any, and interest (including Liquidated Damages to the extent accrued but
unpaid) on such Note, for conversion of such Note and for all other purposes;
and neither the Company nor the Trustee nor any authenticating agent nor any
paying agent nor any conversion agent nor any Note registrar shall be affected
by any notice to the contrary. All such payments so made to any holder for the
time being, or upon his order, shall be valid, and, to the extent of the sum or
sums so paid, effectual to satisfy and discharge the liability for monies
payable upon any such Note.
Section 9.4 Company-Owned Notes Disregarded
In determining whether the holders of the requisite aggregate principal
amount of Notes have concurred in any direction, consent, waiver or other action
under this Indenture, Notes that are owned by the Company or any other obligor
on the Notes or by any Person directly or indirectly controlling or controlled
by or under direct or indirect common control with the Company or any other
obligor on the Notes shall be disregarded and deemed not to be outstanding for
the purpose of any such determination; provided that for the purposes of
determining whether the Trustee shall be protected in relying on any such
direction, consent, waiver or other action only Notes which a Responsible
Officer actually knows are so owned shall be so disregarded. Notes so owned
which have been pledged in good faith may be regarded as outstanding for the
purposes of this Section 9.4 if the pledgee shall establish to the satisfaction
of the Trustee the pledgee's right to vote such Notes and that the pledgee is
not the Company, any other obligor on the Notes or a Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with the Company or any such other obligor. In the case of a dispute as
to such right, any decision by the Trustee taken upon the advice of counsel
shall be full protection to the Trustee. Upon request of the Trustee, the
Company shall furnish to the Trustee promptly an Officer's Certificate listing
and identifying all Notes, if any, known by the Company to be owned or held by
or for the account of any of the above described Persons; and, subject to
Section 8.1, the Trustee shall be entitled to accept such Officer's Certificate
as conclusive evidence of the facts therein set forth and of the fact that all
Notes listed therein are not outstanding for the purpose of any such
determination.
Section 9.5 Revocation of Consents; Future Holders Bound
At any time prior to (but not after) the evidencing to the Trustee, as
provided in Section 9.1, of the taking of any action by the holders of the
percentage in aggregate principal amount of the Notes specified in this
Indenture in connection with such action, any holder of a Note which is shown by
the evidence to be included in the Notes the holders of which have consented to
such action may, by filing written notice with the Trustee at its Corporate
Trust Office and upon proof of holding as provided in Section 9.2, revoke such
action so far as concerns such Note. Except as aforesaid, any such action taken
by the holder of any Note shall
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be conclusive and binding upon such holder and upon all future holders and
owners of such Note and of any Notes issued in exchange or substitution
therefor, irrespective of whether any notation in regard thereto is made upon
such Note or any Note issued in exchange or substitution therefor.
ARTICLE X
NOTEHOLDERS' MEETINGS
Section 10.1 Purpose of Meetings
A meeting of Noteholders may be called at any time and from time to
time pursuant to the provisions of this Article X for any of the following
purposes:
(1) to give any notice to the Company or to the Trustee or to
give any directions to the Trustee permitted under this Indenture, or
to consent to the waiving of any default or Event of Default hereunder
and its consequences, or to take any other action authorized to be
taken by Noteholders pursuant to any of the provisions of Article VII;
(2) to remove the Trustee and nominate a successor trustee
pursuant to the provisions of Article VIII;
(3) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to the provisions of Section 11.2;
(4) to take any other action authorized to be taken by or on
behalf of the holders of any specified aggregate principal amount of
the Notes under any other provision of this Indenture or under
applicable law; or
(5) to take any other action authorized by this Indenture or
under applicable law.
Section 10.2 Call of Meetings by Trustee
The Trustee may at any time call a meeting of Noteholders to take any
action specified in Section 10.1, to be held at such time and at such place in
the Borough of Manhattan, The City of New York, as the Trustee shall determine.
Notice of every meeting of the Noteholders, setting forth the time and the place
of such meeting and in general terms the action proposed to be taken at such
meeting and the establishment of any record date pursuant to Section 9.1, shall
be mailed to holders of Notes at their addresses as they shall appear on the
Note register. Such notice shall also be mailed to the Company. Such notices
shall be mailed not less than twenty (20) nor more than ninety (90) days prior
to the date fixed for the meeting.
Any meeting of Noteholders shall be valid without notice if the holders
of all Notes then outstanding are present in person or by proxy or if notice is
waived before or after the meeting by the holders of all Notes outstanding, and
if the Company and the Trustee are either present by duly authorized
representatives or have, before or after the meeting, waived notice.
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Section 10.3 Call of Meetings by Company or Noteholders
In case at any time the Company, pursuant to a resolution of its Board
of Directors, or the holders of at least 10% in aggregate principal amount of
the Notes then outstanding, shall have requested the Trustee to call a meeting
of Noteholders, by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have mailed the
notice of such meeting within twenty (20) days after receipt of such request,
then the Company or such Noteholders may determine the time and the place for
such meeting and may call such meeting to take any action authorized in Section
10.1, by mailing notice thereof as provided in Section 10.2.
Section 10.4 Qualifications for Voting
To be entitled to vote at any meeting of Noteholders a Person shall (a)
be a holder of one or more Notes on the record date pertaining to such meeting
or (b) be a Person appointed by an instrument in writing as proxy by a holder of
one or more Notes. The only Persons who shall be entitled to be present or to
speak at any meeting of Noteholders shall be the Persons entitled to vote at
such meeting and their counsel and any representatives of the Trustee and its
counsel and any representatives of the Company and its counsel.
Section 10.5 Regulations
Notwithstanding any other provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Noteholders, 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 think fit.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Noteholders as provided in Section 10.3, in which case the Company
or the Noteholders 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 holders of a majority in principal
amount of the Notes represented at the meeting and entitled to vote at the
meeting.
Subject to the provisions of Section 9.4, at any meeting each
Noteholder or proxyholder 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 other than
by virtue of Notes held by him or instruments in writing as aforesaid duly
designating him as the proxy to vote on behalf of other Noteholders. Any meeting
of Noteholders duly called pursuant to the provisions of Section 10.2 or 10.3
may be adjourned from time to time by the holders of a majority of the aggregate
principal amount of Notes represented at the meeting, whether or not
constituting a quorum, and the meeting may be held as so adjourned without
further notice.
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Section 10.6 Voting
The vote upon any resolution submitted to any meeting of Noteholders
shall be by written ballot on which shall be subscribed the signatures of the
holders of Notes or of their representatives by proxy and the principal amount
of the 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 in duplicate of the proceedings of each
meeting of Noteholders 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 mailed as provided in Section 10.2. The record
shall show the principal amount of the Notes voting in favor of or against any
resolution. The record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one of the duplicates shall
be delivered to the Company and the other 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.
Section 10.7 No Delay of Rights by Meeting
Nothing contained in this Article X shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Noteholders or any
rights expressly or implicitly conferred hereunder to make such call, any
hindrance or delay in the exercise of any right or rights conferred upon or
reserved to the Trustee or to the Noteholders under any of the provisions of
this Indenture or of the Notes.
ARTICLE XI
AMENDMENTS; SUPPLEMENTAL INDENTURES
Section 11.1 Amendments; Supplemental Indentures without Consent of
Noteholders
The Company, when authorized by the resolutions of the Board of
Directors, and the Trustee may from time to time and at any time enter into
amendments or indentures supplemental hereto for one or more of the following
purposes:
(a) to make provision with respect to the conversion rights of
the holders of Notes pursuant to the requirements of Section 15.6;
(b) to convey, transfer, assign, mortgage or pledge to the
Trustee as security for the Notes, any property or assets;
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(c) to evidence the succession of another corporation, limited
liability company, partnership or trust to the Company, or successive
successions, and the assumption by the successor corporation, limited
liability company, partnership or trust of the covenants, agreements
and obligations of the Company pursuant to Article XII;
(d) to add to the covenants of the Company such further
covenants, restrictions or conditions as the Board of Directors and the
Trustee shall consider to be for the benefit of the holders of Notes,
including without limitation any reduction of the Conversion Price, and
to make the occurrence, or the occurrence and continuance, of a default
in any such additional covenants, restrictions or conditions a default
or an Event of Default permitting the enforcement of all or any of the
several remedies provided in this Indenture as herein set forth;
provided, however, that in respect of any such additional covenant,
restriction or condition such supplemental indenture may provide for a
particular period of grace after default (which period may be shorter
or longer than that allowed in the case of other defaults) or may
provide for an immediate enforcement upon such default or may limit the
remedies available to the Trustee upon such default;
(e) to provide for the issuance under this Indenture of Notes
in coupon form (including Notes registrable as to principal only) and
to provide for exchangeability of such Notes with the Notes issued
hereunder in fully registered form and to make all appropriate changes
for such purpose;
(f) to cure any ambiguity or to correct or supplement any
provision contained herein or in any supplemental indenture which may
be defective or inconsistent with any other provision contained herein
or in any supplemental indenture, or to make such other provisions in
regard to matters or questions arising under this Indenture which shall
not adversely affect the interests of the holders of the Notes;
(g) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Notes; or
(h) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the
qualifications of this Indenture under the Trust Indenture Act, or
under any similar federal statute hereafter enacted.
The Trustee is hereby authorized to join with the Company in the
execution of any such supplemental indenture, to make any further appropriate
agreements and stipulations which may be therein contained and to accept the
conveyance, transfer and assignment of any property thereunder; provided,
however, the Trustee shall not be obligated to and may, in its discretion, enter
into any supplemental indenture that affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
Any amendment or supplemental indenture authorized by the provisions of
this Section 11.1 may be executed by the Company and the Trustee without the
consent of the holders of any of the Notes at the time outstanding,
notwithstanding any of the provisions of Section 11.2.
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Section 11.2 Amendments; Supplemental Indentures with Consent of
Noteholders
With the consent (evidenced as provided in Article IX) of the holders
of not less than a majority in aggregate principal amount of the Notes at the
time outstanding (determined in accordance with Section 9.4), the Company, when
authorized by the resolutions of the Board of Directors, and the Trustee may
from time to time and at any time enter into amendments or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or any
supplemental indenture or of modifying in any manner the rights of the holders
of the Notes; provided, however, that no such amendment or supplemental
indenture shall (i) extend the fixed maturity of any Note, or reduce the rate or
extend the time of payment of interest thereon, or reduce the principal amount
thereof or premium, if any, thereon, or reduce any amount payable on redemption
or repurchase thereof, impair, or change in any respect adverse to the holder of
Notes, the obligation of the Company to repurchase any Note at the option of the
holder upon the happening of a Repurchase Event, or impair or adversely affect
the right of any Noteholder to institute suit for the payment thereof, or change
the currency in which the Notes are payable, or impair or change in any respect
adverse to the Noteholders the right to convert the Notes into Common Stock
subject to the terms set forth herein, including Section 15.6, without the
consent of the holder of each Note so affected, or (ii) reduce the aforesaid
percentage of Notes, the holders of which are required to consent to any such
supplemental indenture, or modify this paragraph, without the consent of the
holders of all Notes then outstanding; provided, further, however, that any
amendment or supplemental indenture that disproportionately affects the rights
of a Noteholder or a class of Noteholder shall require the prior consent of such
Noteholder or the prior consent of Noteholders holding a majority of the
principal amount of Notes then held by such class, as applicable.
Upon the request of the Company, accompanied by a copy of the
resolutions of the Board of Directors certified by its Secretary or Assistant
Secretary authorizing the execution of any such amendment or supplemental
indenture, and upon the filing with the Trustee of evidence of the consent of
Noteholders as aforesaid, the Trustee shall join with the Company in the
execution of such amendment or supplemental indenture unless such amendment or
supplemental indenture affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise, in which case the Trustee may in is
discretion, but shall not be obligated to, enter into such amendment or
supplemental indenture.
It shall not be necessary for the consent of the Noteholders under this
Section 11.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such consent shall approve the
substance thereof.
Section 11.3 Effect of Amendments and Supplemental Indentures
Any amendment or supplemental indenture executed pursuant to the
provisions of this Article XI shall comply with the Trust Indenture Act, as then
in effect; provided that this Section 11.3 shall not require such amendment or
supplemental indenture or the Trustee to be qualified under the Trust Indenture
Act prior to the time such qualification is in fact required under the terms of
the Trust Indenture Act or the Indenture has been qualified under the Trust
Indenture Act, nor shall it constitute any admission or acknowledgement by any
party to such
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amendment or supplemental indenture that any such qualification is required
prior to the time such qualification is in fact required under the terms of the
Trust Indenture Act or the Indenture has been qualified under the Trust
Indenture Act. Upon the execution of any amendment or supplemental indenture
pursuant to the provisions of this Article XI, this Indenture shall be and be
deemed to be modified and amended in accordance therewith and the respective
rights, limitation of rights, obligations, duties and immunities under this
Indenture of the Trustee, the Company and the holders of Notes shall thereafter
be determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
Section 11.4 Notation on Notes
Notes authenticated and delivered after the execution of any amendment
or supplemental indenture pursuant to the provisions of this Article XI may bear
a notation in form approved by the Trustee as to any matter provided for in such
amendment or supplemental indenture. If the Company or the Trustee shall so
determine, new Notes so modified as to conform, in the opinion of the Trustee
and the Board of Directors, to any modification of this Indenture contained in
any such amendment or supplemental indenture may, at the Company's expense, be
prepared and executed by the Company, authenticated by the Trustee (or an
authenticating agent duly appointed by the Trustee pursuant to Section 17.11)
and delivered in exchange for the Notes then outstanding, upon surrender of such
Notes then outstanding.
Section 11.5 Evidence of Compliance of Amendment or Supplemental
Indenture to be Furnished to Trustee
The Trustee, subject to the provisions of Sections 8.1 and 8.2, shall
receive an Officer's Certificate and an Opinion of Counsel as conclusive
evidence that any amendment or supplemental indenture executed pursuant hereto
complies with the requirements of this Article XI.
ARTICLE XII
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
Section 12.1 Company May Consolidate, Etc.
The Company shall not, directly or indirectly, consolidate with or
merge with or into any other Person or sell, lease, convey or transfer all or
substantially all its assets, whether in a single transaction or a series of
related transactions, to any Person or group of affiliated Persons unless:
(a) either (i) in the case of a merger or consolidation that
does not involve a transfer of all or substantially all of the
Company's properties and assets, the Company is the surviving entity or
(ii) in case the Company shall consolidate with or merge into another
Person or sell, lease, convey or transfer all or substantially all of
its properties and assets, whether in a single transaction or a series
of related transactions, to any
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Person, the Person formed by such consolidation or into which the
Company is merged, or the Person which acquires by sale, conveyance or
transfer, or which leases the properties and assets of the Company
substantially as an entirety, shall be a corporation, limited liability
company, partnership or trust, shall be organized and validly existing
under the laws of the United States of America, any state thereof or
the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the
principal of, premium, if any, and interest (including Liquidated
Damages, if any) on all of the Notes as applicable, and the performance
or observance of every covenant of this Indenture on the part of the
Company to be performed or observed and shall have provided for the
applicable conversion rights set forth in Section 15.6 and the
repurchase rights set forth in Article XVI;
(b) immediately after giving effect to such transaction, no
Event of Default, and no event that after notice or lapse of time or
both, would become an Event of Default, shall have happened and be
continuing; and
(c) the Company has delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such transaction,
such supplemental indenture complies with this Article XII and that all
conditions precedent herein provided for relating to such transaction
have been complied with, together with any documents required under
Article IX.
Section 12.2 Successor Entity to be Substituted
In case of any such consolidation, merger, sale, conveyance or lease in
accordance with Section 12.1, and, where required in accordance with Section
12.1(a) upon the assumption by the successor entity, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the Trustee,
of the due and punctual payment of the principal of and premium, if any, and
interest (including Liquidated Damages, if any) on all of the Notes and the due
and punctual performance of all of the covenants and conditions of this
Indenture to be performed by the Company, such successor entity shall succeed to
and be substituted for the Company, with the same effect as if it had been named
herein as the party of the first part. Such successor entity thereupon may cause
to be signed, and may issue either in its own name or in the name of Dave &
Buster's, Inc. any or all of the Notes issuable hereunder which theretofore
shall not have been signed by the Company and delivered to the Trustee; and,
upon the order of such successor entity instead of the Company and subject to
all the terms, conditions and limitations in this Indenture prescribed, the
Trustee shall authenticate and shall deliver, or cause to be authenticated and
delivered, any Notes which previously shall have been signed and delivered by
the officers of the Company to the Trustee for authentication, and any Notes
which such successor entity thereafter shall cause to be signed and delivered to
the Trustee for that purpose. All the Notes so issued shall in all respects have
the same legal rank and benefit under this Indenture as the Notes theretofore or
thereafter issued in accordance with the terms of this Indenture as though all
of such Notes had been issued at the date of the execution hereof. In the event
of any such consolidation, merger, sale, conveyance or lease, the Person named
as the
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"Company" in the first paragraph of this Indenture or any successor which shall
thereafter have become such in the manner prescribed in this Article XII may be
dissolved, wound up and liquidated at any time thereafter and such Person shall
be released from its liabilities as obligor and maker of the Notes and from its
obligations under this Indenture.
In case of any such consolidation, merger, sale, conveyance or lease,
such changes in phraseology and form (but not in substance) may be made in the
Notes thereafter to be issued as may be appropriate.
Section 12.3 Opinion of Counsel to be Given Trustee
The Trustee, subject to Sections 8.1 and 8.2, shall receive an
Officer's Certificate and an Opinion of Counsel as conclusive evidence that any
such consolidation, merger, sale, conveyance or lease and any such assumption
complies with the provisions of this Article XII.
ARTICLE XIII
SATISFACTION AND DISCHARGE OF INDENTURE
Section 13.1 Discharge of Indenture
When (a) the Company shall deliver to the Trustee for cancellation all
Notes theretofore authenticated (other than any Notes that 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 theretofore canceled, or (b) all
the Notes not theretofore canceled or delivered to the Trustee for cancellation
shall have become due and payable, or are by their terms to become due and
payable within one year or are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of redemption,
and the Company shall deposit with the Trustee, in trust, funds sufficient to
pay at maturity or upon redemption of all of the Notes (other than any Notes
which shall have been mutilated, destroyed, lost or stolen and in lieu of or in
substitution for which other Notes shall have been authenticated and delivered)
not theretofore canceled or delivered to the Trustee for cancellation, including
principal and premium, if any, and interest (including Liquidated Damages, if
any) due or to become due to such date of maturity or redemption date, as the
case may be, and if in either case the Company shall also pay or cause to be
paid all other sums payable hereunder by the Company, 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 Noteholders to receive payments of principal of and premium, if
any, and interest on, the Notes and the other rights, duties and obligations of
Noteholders, as beneficiaries hereof with respect to the amounts, if any, so
deposited with the Trustee and (iii) the rights, obligations and immunities of
the Trustee hereunder), and the Trustee, on demand of the Company accompanied by
an Officer's Certificate and an Opinion of Counsel as required by Section 17.5
and at the cost and expense of the Company, shall execute proper instruments
acknowledging satisfaction of and discharging this Indenture; the Company,
however, hereby agreeing to reimburse the Trustee for any costs or expenses
thereafter reasonably and properly incurred by the Trustee and to compensate the
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Trustee for any services thereafter reasonably and properly rendered by the
Trustee in connection with this Indenture or the Notes.
Section 13.2 Deposited Monies to be Held in Trust by Trustee
Subject to Section 13.4, all monies deposited with the Trustee pursuant
to Section 13.1 shall be held in trust and applied by it to the payment, either
directly or through any paying agent (including the Company 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 and interest and premium, if
any.
Section 13.3 Paying Agent to Repay Monies Held
Upon the satisfaction and discharge of this Indenture, all monies then
held by any paying agent of the Notes (other than the Trustee) shall, upon
demand of the Company, be repaid to it or paid to the Trustee, and thereupon
such paying agent shall be released from all further liability with respect to
such monies.
Section 13.4 Return of Unclaimed Monies
Subject to the requirements of applicable law, any monies deposited
with or paid to the Trustee for payment of the principal of, premium, if any, or
interest on Notes and not applied but remaining unclaimed by the holders of
Notes for two (2) years after the date upon which the principal of, premium, if
any, or interest (including Liquidated Damages, if any) on such Notes, as the
case may be, shall have become due and payable, shall be repaid to the Company
by the Trustee on written demand and all liability of the Trustee shall
thereupon cease with respect to such monies; and the holder of any of the Notes
shall thereafter look only to the Company for any payment which such holder may
be entitled to collect unless an applicable abandoned property law designates
another Person.
Section 13.5 Reinstatement
If (i) the Trustee or the paying agent is unable to apply any money in
accordance with Section 13.2 by reason of any order or judgment of any court or
governmental authority enjoining, restraining or otherwise prohibiting such
application and (ii) the holders of at least a majority in principal amount of
the then outstanding Notes so request by written notice to the Trustee, the
Company's obligations under this Indenture and the Notes shall be revived and
reinstated as though no deposit had occurred pursuant to Section 13.1 until such
time as the Trustee or the paying agent is permitted to apply all such money in
accordance with Section 13.2; provided, however, that if the Company makes any
payment of interest on or principal of any Note following the reinstatement of
its obligations, the Company shall be subrogated to the rights of the holders of
such Notes to receive such payment from the money held by the Trustee or paying
agent.
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ARTICLE XIV
NO RECOURSE AGAINST OTHERS
Section 14.1 Indenture and Notes Solely Corporate Obligations
No direct or indirect partner, employee, incorporator, stockholder,
director or officer, as such, past, present or future of the Company or any
successor corporation or any Subsidiary or any of the Company's Affiliates,
shall have any personal liability in respect of the obligations of the Company
under the Notes or this Indenture by reason of his, her or its status as such
partner, employee, incorporator, stockholder, director or officer. Each
Noteholder by accepting a Note waives and releases all such liability. Such
waiver and release are part of the consideration for the issuance of the Notes.
ARTICLE XV
CONVERSION OF NOTES
Section 15.1 Right to Convert
Subject to and upon compliance with the provisions of this Indenture,
the holder of any Note shall have the right, at his option, at any time
following the date of original issuance of the Notes and prior to the close of
business on August 7, 2008 (except that, with respect to any Note or portion of
a Note that shall be called for redemption, such right shall terminate, except
as provided in the fifth paragraph of Section 15.2 and Section 3.4, at the close
of business on the last Business Day prior to the date fixed for redemption of
such Note or portion of a Note unless the Company shall default in payment due
upon redemption thereof), to convert the principal amount of any such Note, or
any portion of such principal amount which is $1,000 or an integral multiple
thereof, into that number of fully paid and non-assessable shares of Common
Stock (as such shares shall then be constituted) obtained by dividing the
principal amount of the Note or portion thereof surrendered for conversion by
the Conversion Price in effect at such time, by surrender of the Note so to be
converted in whole or in part in the manner provided in Section 15.2. A holder
of Notes is not entitled to any rights of a holder of Common Stock until such
holder has converted his Notes to Common Stock, and only to the extent such
Notes are deemed to have been converted to Common Stock under this Article XV. A
Note with respect to which a holder has delivered a notice in accordance with
Section 16.2 regarding such holder's election to require the Company to
repurchase such holder's Notes following the occurrence of a Repurchase Event
may be converted in accordance with this Article XV only if such holder
withdraws such repurchase notice by delivering a written notice of withdrawal to
the Company prior to the close of business on the last Business Day prior to the
day fixed for repurchase. If the holder of any Note exercises the right of
conversion set forth in this Article XV prior to August 7, 2005, the Company
shall make an additional payment in cash to such holder with respect to the
Notes converted, in an amount (a "Holder Conversion Provisional Payment") equal
to $50.00 per each $1,000 principal amount of the Note,
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Section 15.2 Exercise of Conversion Privilege; Issuance of Common Stock
on Conversion
In order to exercise the conversion privilege with respect to any
Definitive Note, the holder of such Definitive Note then registered on the books
of the Company shall (i) deliver a written notice, in the form of the conversion
notice attached as Exhibit A to such Definitive Note, or a reasonable facsimile
thereof (the "Conversion Notice"), to the Company and the conversion agent, of
such holder's election to convert, which notice shall specify that all of such
Note shall be converted or the portion thereof to be converted (which shall be
$1,000 or an integral multiple thereof), (ii) if such Note or portion thereof is
surrendered for conversion during the period from the close of business on the
Business Day preceding the record date for any interest payment date through the
close of business on the Business Day next preceding such interest payment date,
pay by wire transfer of immediately available funds or other method acceptable
to the Company, an amount equal to the interest otherwise payable on such
interest payment date on the principal amount being converted (unless such Note
or portion thereof being converted shall have been called for redemption
pursuant to a redemption notice mailed to the Noteholders in accordance with
Section 3.2 or shall have become due prior to such interest payment date as a
result of a Repurchase Event); provided, however, that no such payment need be
made if (x) there shall exist at the time of conversion a default in the payment
of interest on the Notes, or (y) such converting holder holds a Definitive Note
and requests that such payment be netted against the interest payable with
respect to the converted Note on the next interest payment date, by notifying
the Company and the Trustee of such election not later than two (2) Business
Days prior to the earlier of the Conversion Date and such interest payment date,
and includes in such notification a representation and warranty in favor of the
Company to the effect the such holder has owned such Definitive Note at all
times from and after the Business Day preceding such record date, (iii) pay by
wire transfer of immediately available funds or other method acceptable to the
Company the transfer taxes, if any, required pursuant to Section 15.7, and (iv)
surrender the Definitive Note to be converted in whole or in part to a common
carrier for overnight delivery to the Company as soon as practicable following
such date (or an indemnification undertaking or other form of security
reasonably satisfactory to the Company with respect to the Definitive Note in
the case of its loss, theft or destruction). Anything herein to the contrary
notwithstanding, in the case of Global Securities, conversion notices may be
delivered and a Participant's interest in a Global Note may be surrendered for
conversion in accordance with the Applicable Procedures as in effect from time
to time. Each Note surrendered for conversion shall, unless the shares issuable
on conversion are to be issued in the same name as the registration of such
Note, be duly endorsed by, or be accompanied by instruments of transfer
(including a broker's letter regarding compliance with the prospectus delivery
requirement, if applicable) in form satisfactory to the Company duly executed
by, the holder or his duly authorized attorney.
The Company shall use its best efforts to, within three (3) Business
Days after the Conversion Date (as defined below) with respect to any Note,
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 Noteholder (as if
such transfer were a transfer of the Note or Notes (or portion thereof) so
converted) (a)(i) in the case of a public resale of the Common Stock issuable
upon such conversion, at the holder's request, credit such aggregate number of
shares of Common Stock to
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which the holder shall be entitled to the holder's or its designee's balance
account with The Depository Trust Company through its Deposit Withdrawal Agent
Commission system or (ii) issue and deliver to the address as specified in the
Conversion Notice, a certificate or certificates in such denominations as may be
requested by the holder in the Conversion Notice, registered in the name of the
holder or its designee, for the number of shares of Common Stock to which the
holder shall be entitled upon such conversion, and (b) deliver to such holder a
check or cash in respect of (i) any fractional interest in respect of a share of
Common Stock arising upon such conversion, as provided in Section 15.3 and (ii)
the Holder Conversion Provisional Payment, if any (which payment, if any, shall
be paid no later than five (5) Business Days after the Conversion Date). In case
any Note of a denomination greater than $1,000 shall be surrendered for partial
conversion, and subject to Section 2.3, the Company shall execute and the
Trustee shall authenticate and deliver to the holder of the Note so surrendered,
without charge to him, a new Note or Notes in authorized denominations in an
aggregate principal amount equal to the unconverted portion of the surrendered
Note.
If the Company shall not have (a) delivered the number of shares of
Common Stock issued upon conversion of Notes by any holder and (b) made any
Holder Conversion Provisional Payment required pursuant to Section 15.1, within
five (5) Business Days after the Conversion Date with respect to such Notes, the
Company shall pay Liquidated Damages to such holder at the rate of one-half
percent (0.5%) per month of the outstanding principal amount of Notes so
converted by such holder.
The 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 15.2 have been satisfied as to such Note (or portion thereof)
(such date, the "Conversion Date"), and the Person in whose name any shares of
Common Stock shall be issuable upon such conversion shall be deemed to have
become on the Conversion Date the holder of record of the shares represented
thereby; provided, however, that any such surrender on any date when the stock
transfer books of the Company 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 Price in effect on the date
upon which such Note shall be surrendered. For purposes of determining
satisfaction of the requirement set forth above with respect to the Conversion
Date for any Note, any facsimile required to be sent shall be deemed to have
been sent on a given day if such facsimile was received before 1:00 p.m., New
York City time, on such date, to the number listed above (unless a different
number is specified in a notice filed with the Trustee and mailed by the
Trustee, at the Company's expense, to each holder of the Notes at such holder's
address appearing in the Note register, as provided for in Section 2.5 of this
Indenture) and a confirmation of transmission of such facsimile is obtained.
The Company shall pay in cash, on any Note or portion thereof
surrendered for conversion during the period from the close of business on any
interest payment date to which interest has been fully paid through the close of
business on the Business Day preceding the record date for the next such
interest payment date, accrued and unpaid interest, if any, on the Note or
portion thereof surrendered for conversion to, but excluding, the date of
conversion, and Liquidated Damages, if any. Any such payment of interest shall
be made with respect to such
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Note within ten (10) Business Days after the Conversion Date. Notwithstanding
the foregoing, any Note or portion thereof surrendered for conversion during the
period from the close of business on the record date for any interest payment
date through the close of business on the Business Day next preceding such
interest payment date shall (unless such Note or portion thereof being converted
shall have been called for redemption pursuant to a redemption notice mailed to
the Noteholders in accordance with Section 3.2 or shall have become due prior to
such interest payment date as a result of a Repurchase Event) be accompanied by
payment, in immediately available funds or other funds acceptable to the
Company, of an amount equal to the interest otherwise payable on such interest
payment date on the principal amount being converted; provided, however, that no
such payment need be made if there shall exist at the time of conversion a
default in the payment of interest on the Notes. Nothing in this Section 15.2
shall affect the right of a Holder in whose name any Note is registered at the
close of business on a record date to receive the interest payable on such Note
on the related interest payment date in accordance with the terms of this
Indenture and the Note. Except as provided in this Section 15.2, no adjustment
shall be made for interest accrued on any Note converted or for dividends on any
shares issued upon the conversion of such Note as provided in this Article.
Section 15.3 Cash Payments in Lieu of Fractional Shares
No fractional shares of Common Stock or scrip representing fractional
shares shall be issued upon conversion of 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 issuable upon conversion thereof shall be computed on the
basis of the aggregate principal amount of the Notes (or specified portions
thereof to the extent permitted hereby) so surrendered for conversion. If any
fractional share of stock otherwise would be issuable upon the conversion of any
Note or Notes, the Company shall calculate and pay a cash adjustment in lieu of
such fractional share at the current market value thereof to the holder of
Notes. The current market value of a share of Common Stock shall be the Closing
Price on the first Trading Day immediately preceding the day on which the Notes
(or specified portions thereof) are deemed to have been converted and such
Closing Price shall be determined as provided in Section 15.5(e).
Section 15.4 Conversion Price
The conversion price shall be as specified in the form of Note (herein
called the "Conversion Price") attached as Exhibit A hereto, subject to
adjustment as provided in this Article XV.
Section 15.5 Adjustment of Conversion Price
The Conversion Price shall be adjusted from time to time by the Company
as follows:
(a) In case the Company shall hereafter pay a dividend or make
a distribution to all holders of the outstanding Common Stock in shares
of Common Stock, the Conversion Price in effect at the opening of
business on the date following the date fixed for the determination of
stockholders entitled to receive such dividend or other distribution
shall be reduced by multiplying such Conversion Price by a fraction of
which
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the numerator shall be the number of shares of Common Stock outstanding
at the close of business on the Record Date (as defined in Section
15.5(e)) fixed for such determination and the denominator shall be the
sum of such number of shares and the total number of shares
constituting such dividend or other distribution, such reduction to
become effective immediately after the opening of business on the day
following the Record Date. If any dividend or distribution of the type
described in this Section 15.5(a) is declared but not so paid or made,
the Conversion Price shall again be adjusted to the Conversion Price
which would then be in effect if such dividend or distribution had not
been declared.
(b) In case the outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock, the
Conversion Price in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall
be proportionately reduced, and conversely, in case outstanding shares
of Common Stock shall be combined into a smaller number of shares of
Common Stock, the Conversion Price in effect at the opening of business
on the day following the day upon which such combination becomes
effective shall be proportionately increased, 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 to all
holders of its outstanding shares of Common Stock entitling them to
subscribe for or purchase shares of Common Stock at a price per share
less than the Current Market Price (as defined in Section 15.5(e)) 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 of which the numerator shall be the sum
of the number of shares of Common Stock outstanding at the close of
business on the Record Date plus the number of shares that the
aggregate offering price of the total number of shares so offered for
subscription or purchase would purchase at such Current Market Price,
and of which the denominator shall be the sum of the number of shares
of Common Stock outstanding at the close of business on the Record Date
plus the total number of additional shares of Common Stock so offered
for subscription or purchase. Such adjustment shall become effective
immediately after the opening of business on the day following the
Record Date fixed for determination of stockholders entitled to receive
such rights or warrants. To the extent that shares of Common Stock 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 that would then be in effect had the
adjustments made upon the issuance of such rights or warrants been made
on the basis of delivery of only the number of shares of Common Stock
actually delivered. In the event that such rights or warrants are not
so issued, the Conversion Price shall again be adjusted to be the
Conversion Price that would then be in effect if such date fixed for
the determination of stockholders entitled to receive such rights or
warrants had not been fixed. In determining whether any rights or
warrants entitle the holders to subscribe for or purchase shares of
Common
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Stock at less than such Current Market Price, and in determining the
aggregate offering price of such shares of Common Stock, 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 in good faith by the Board of Directors.
(d) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock shares of any class of
capital stock of the Company (other than any dividends or distributions
to which Section 15.5(a) applies) or evidences of its indebtedness or
other assets (including securities, but excluding (1) any rights or
warrants referred to in Section 15.5(c) and (2) dividends and
distributions paid exclusively in cash (except as set forth in Section
15.5 (e), (the foregoing hereinafter in this Section 15.5(d) called the
"Securities")), unless the Company elects to reserve such Securities
for distribution to the Noteholders upon conversion of the Notes so
that any such holder converting Notes will receive upon such
conversion, in addition to the shares of Common Stock to which such
holder is entitled, the amount and kind of such Securities which such
holder would have received if such holder had converted its Notes into
Common Stock immediately prior to the Record Date (as defined in
Section 15.5(e)) for such distribution of the Securities then, in each
such case, the Conversion Price shall be reduced so that the same shall
be equal to the price determined by multiplying the Conversion Price in
effect immediately prior to the close of business on the Record Date
with respect to such distribution by a fraction of which the numerator
shall be the Current Market Price (determined as provided in Section
15.5(e)) on such date less the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and
described in a Board Resolution) on such date of the portion of the
Securities so distributed applicable to one share of Common Stock and
the denominator shall be such Current Market Price, such reduction to
become effective immediately prior to the opening of business on the
day following the Record Date; provided, however, that in the event the
then fair market value (as so determined) of the portion of the
Securities so distributed applicable to one share of Common Stock 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 Noteholder 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 determines the fair market value of any
distribution for purposes of this Section 15.5(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 15.5(e) to the
extent possible, unless the Board of Directors in a Board Resolution
determines that determining the fair market value during the Reference
Period would not be in the best interest of the Noteholder.
In the event that the Company implements a new stockholder
rights plan, such rights plan shall provide that upon conversion of the
Notes the holders will receive, in
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addition to the Common Stock issuable upon such conversion, the rights
issued under such rights plan as if the holders had converted the Notes
prior to implementing the rights plan and notwithstanding the
occurrence of an event causing such rights to separate from the Common
Stock at or prior to the time of conversion. Any distribution of rights
or warrants pursuant to a stockholder rights plan complying with the
requirements set forth in the immediately preceding sentence of this
paragraph shall not constitute a distribution of rights or warrants for
the purposes of this Section 15.5(d).
Rights or warrants distributed by the Company to all holders
of Common Stock entitling the holders thereof to subscribe for or
purchase shares of the Company's capital stock (either initially or
under certain circumstances), which rights or warrants, until the
occurrence of a specified event or events ("Trigger Event"): (i) are
deemed to be transferred with such shares of Common Stock; (ii) are not
exercisable; and (iii) are also issued in respect of future issuances
of Common Stock, shall be deemed not to have been distributed for
purposes of this Section 15.5(d) (and no adjustment to the Conversion
Price under this Section 15.5(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 15.5(d), (1) in the case of any such rights or warrants
that 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 Stock with respect to such rights or
warrants (assuming such holder had retained such rights or warrants),
made to all holders of Common Stock as of the date of such redemption
or repurchase, and (2) 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 15.5(d) and Sections 15.5(a) and
(c), any dividend or distribution to which this Section 15.5(d) is
applicable that also includes shares of Common Stock, or rights or
warrants to subscribe for or purchase shares of Common Stock to which
Section 15.5(c) applies (or both), shall be deemed instead to be (1) a
dividend or distribution of the evidences of indebtedness, assets,
shares of capital stock, rights or warrants other than such shares of
Common Stock or rights or warrants to which Section 15.5(c) applies
immediately followed by (2) a dividend or distribution of such shares
of Common Stock or such rights or warrants (and any further Conversion
Price reduction required by Sections 15.5(a) and (c) with respect to
such dividend or
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distribution shall then be made, except (A) the Record Date of such
dividend or distribution shall be substituted as "the date fixed for
the determination of stockholders entitled to receive such dividend or
other distribution", "Record Date fixed for such determination" and
"Record Date" within the meaning of Section 15.5(a) and as "the date
fixed for the determination of stockholders entitled to receive such
rights or warrants", "the Record Date fixed for the determination of
the stockholders entitled to receive such rights or warrants" and "such
Record Date" within the meaning of Section 15.5(c) and (B) any shares
of Common Stock included in such dividend or distribution shall not be
deemed "outstanding at the close of business on the date fixed for such
determination" within the meaning of Section 15.5(a).
(e) For purposes of this Section 15.5, the following terms shall have
the meaning indicated:
(1) "Closing Price" with respect to any securities on any day
shall mean the closing sale price regular way on such day or, in case
no such sale takes place on such day, the average of the reported
closing bid and asked prices, regular way, in each case on the Nasdaq
National Market or New York Stock Exchange, as applicable, or, if such
security is not listed or admitted to trading on such National Market
or Exchange, on the principal national security exchange or quotation
system on which such security is quoted or listed or admitted to
trading, or, if not quoted or listed or admitted to trading on any
national securities exchange or quotation system, the average of the
closing bid and asked prices of such security on the over-the-counter
market on the day in question as reported by the National Quotation
Bureau Incorporated, or a similar generally accepted reporting service,
or if not so available, in such manner as furnished by any New York
Stock Exchange member firm selected from time to time by the Board of
Directors for that purpose, or a price determined in good faith by the
Board of Directors, whose determination shall be conclusive and
described in a Board Resolution.
(2) "Current Market Price" shall mean the average of the daily
Closing Prices per share of Common Stock for the ten (10) consecutive
Trading Days immediately prior to the date in question; provided,
however, that (1) if 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 15.5(a), (b), (c) or (d) occurs during such ten
(10) 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, (2) if 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 15.5(a), (b),
(c) or (d) 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
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the reciprocal of the fraction by which the Conversion Price is so
required to be adjusted as a result of such other event, and (3) if 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 (1) or (2) of this proviso, the
Closing Price for each Trading Day on or after such "ex" date shall be
adjusted by adding thereto the amount of any cash and the fair market
value (as determined by the Board of Directors in a manner consistent
with any determination of such value for purposes of Section 15.5(d),
whose determination shall be conclusive and described in a Board
Resolution) of the evidences of indebtedness, shares of capital stock
or assets being distributed applicable to one share of Common Stock as
of the close of business on the day before such "ex" date. For purposes
of this paragraph, the term "ex" date, (1) when used with respect to
any issuance or distribution, means the first date on which the Common
Stock trades regular way on the relevant exchange or in the relevant
market from which the Closing Price was obtained without the right to
receive such issuance or distribution and (2) when used with respect to
any subdivision or combination of shares of Common Stock, means the
first date on which the Common Stock trades regular way on such
exchange or in such market after the time at which such subdivision or
combination becomes effective. Notwithstanding the foregoing, whenever
successive adjustments to the Conversion Price are called for pursuant
to this Section 15.5, such adjustments shall be made to the Current
Market Price as may be necessary or appropriate to effectuate the
intent of this Section 15.5 and to avoid unjust or inequitable results
as determined in good faith by the Board of Directors.
(3) "fair market value" shall mean the amount which a willing
buyer would pay a willing seller in an arm's length transaction.
(4) "Record Date" shall mean, with respect to any dividend,
distribution or other transaction or event in which the holders of
Common Stock have the right to receive any cash, securities or other
property or in which the Common Stock (or other applicable security) is
exchanged for or converted into any combination of cash, securities or
other property, the date fixed for determination of stockholders
entitled to receive such cash, securities or other property (whether
such date is fixed by the Board of Directors or by statute, contract or
otherwise).
(5) "Trading Day" shall mean (x) if the applicable security is
listed or admitted for trading on the New York Stock Exchange or
another national security exchange, a day on which the New York Stock
Exchange or such other national security exchange, as applicable, is
open for business or (y) if the applicable security is quoted on the
Nasdaq National Market, a day on which trades may be made thereon or
(z) if the applicable security is not so listed, admitted for trading
or quoted, any day other than a Saturday or Sunday or a day on which
banking institutions in the State of New York are authorized or
obligated by law or executive order to close.
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(f) The Company may make such reductions in the Conversion
Price, in addition to those required by Sections 15.5(a), (b), (c) or
(d), as the Board of Directors considers to be advisable to avoid or
diminish any income tax to holders of Common Stock or rights to
purchase Common Stock 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 Company from
time to time may reduce the Conversion Price by any amount for any
period of time if the period is at least twenty (20) days, the
reduction is irrevocable during the period and the Board of Directors
shall have made a determination that such reduction would be in the
best interests of the Company, which determination shall be conclusive
and described in a Board Resolution. Whenever the Conversion Price is
reduced pursuant to the preceding sentence, the Company shall mail to
the holder of each Note at his last address appearing on the Note
register provided for in Section 2.5 a notice of the reduction at least
fifteen (15) days prior to the date the reduced Conversion Price takes
effect, and such notice shall state the reduced Conversion Price and
the period during which it will be in effect.
(g) No adjustment in the Conversion Price shall be required
under this Section 15.5 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 15.5(g) are not
required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Article XV shall
be made by the Company and shall be made to the nearest cent or to the
nearest one hundredth 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 Stock.
(h) Whenever the Conversion Price is adjusted as provided in
this Section 15.5, the Company shall promptly file with the Trustee and
any conversion agent other than the Trustee an Officer's Certificate
setting forth the Conversion Price after such adjustment and setting
forth a brief statement of the facts requiring such adjustment.
Promptly after delivery of such certificate, the Company shall prepare
a notice of such adjustment of the Conversion Price setting forth the
adjusted Conversion Price and the date on which each adjustment becomes
effective and shall mail such notice of such adjustment of the
Conversion Price to the holder of each Note at his last address
appearing on the Note register provided for in Section 2.5, within
twenty (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.
(i) In any case in which this Section 15.5 provides that an
adjustment shall become effective immediately after a Record Date for
an event, the Company 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 shares of Common
Stock issuable upon such conversion by reason of the adjustment
required by such event over and above the Common Stock 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 15.3.
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(j) For purposes of this Section 15.5, the number of shares of
Common Stock 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 shares of
Common Stock. The Company will not pay any dividend or make any
distribution on shares of Common Stock held in the treasury of the
Company.
Section 15.6 Effect of Reclassification, Consolidation, Merger or Sale
Subject to the provisions of Article XVI, if any of the following
events occur, namely (i) any reclassification or change of the outstanding
shares of Common Stock (other than a change in par value, or from par value to
no par value, or from no par value to par value, or as a result of a subdivision
or combination), (ii) any consolidation, merger or combination of the Company
with another Person as a result of which holders of Common Stock shall be
entitled to receive stock, securities or other property or assets (including
cash) with respect to or in exchange for such Common Stock (other than as a
result of a change in name, a change in par value or a change in the
jurisdiction of incorporation), (iii) any statutory exchange as a result of
which holders of Common Stock generally shall be entitled to receive stock,
securities or other property or assets (including cash) with respect to or in
exchange for such Common Stock (such transaction, a "Statutory Exchange"), or
(iv) any sale or conveyance of the properties and assets of the Company as, or
substantially as, an entirety to any other Person as a result of which holders
of Common Stock shall be entitled to receive stock, securities or other property
or assets (including cash) with respect to or in exchange for such Common Stock,
then the Company or the successor or purchasing Person, as the case may be,
shall execute with the Trustee a supplemental indenture (which shall comply with
the Trust Indenture Act as in force at the date of execution of such
supplemental indenture if such supplemental indenture is then required to so
comply) providing that such Note shall be convertible into the kind and amount
of shares of stock and other securities or property or assets (including cash)
receivable upon such reclassification, change, consolidation, merger,
combination, Statutory Exchange, sale or conveyance by a holder of a number of
shares of Common Stock issuable upon conversion of such Notes (assuming, for
such purposes, a sufficient number of authorized shares of Common Stock
available to convert all such Notes) immediately prior to such reclassification,
change, consolidation, merger, combination, Statutory Exchange, sale or
conveyance assuming such holder of Common Stock did not exercise his rights of
election, if any, that holders of Common Stock who were entitled to vote or
consent to such transaction had as to the kind or amount of securities, cash or
other property receivable upon such consolidation, merger, combination,
Statutory Exchange, sale or conveyance (provided that, if the kind or amount of
securities, cash or other property receivable upon such consolidation, merger,
combination, Statutory Exchange, sale or conveyance is not the same for each
share of Common Stock in respect of which such rights of election shall not have
been exercised ("non-electing share"), then for the purposes of this Section
15.6 the kind and amount of securities, cash or other property receivable upon
such consolidation, merger, combination, Statutory 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). Such
supplemental indenture shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Article
XV. If, in the case of any such reclassification, change, consolidation, merger,
combination, Statutory Exchange, sale or conveyance, the stock or other
securities and assets receivable thereupon by a
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holder of shares of Common Stock include shares of stock or other securities and
assets of a Person other than the successor or purchasing Person, as the case
may be, in such reclassification, change, consolidation, merger, combination,
Statutory Exchange, sale or conveyance, then such supplemental indenture shall
also be executed by such other Person and shall contain such additional
provisions to protect the interests of the holders of the Notes as the Board of
Directors 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 XVI herein.
The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each holder of Notes, at his address appearing on the
Note register provided for in Section 2.5 of this Indenture, within twenty (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 15.6 shall similarly apply to
successive reclassifications, changes, consolidations, mergers, combinations,
sales and conveyances.
If this Section 15.6 applies to any event or occurrence, Section 15.5
shall not apply.
Section 15.7 Taxes on Shares Issued
The issue of stock certificates on conversions of Notes shall be made
without charge to the converting Noteholder for any tax in respect of the issue
thereof. The Company shall not, however, be required to pay any tax which may be
payable in respect of any transfer involved in the issue and delivery of stock
in any name other than that of the holder of any Note converted, and the Company
shall not be required to issue or deliver any such stock certificate unless and
until the Person or Persons requesting the issue thereof shall have paid to the
Company the amount of such tax or shall have established to the satisfaction of
the Company that such tax has been paid.
Section 15.8 Reservation of Shares; Shares to be Fully Paid; Listing of
Common Stock
The Company shall provide, free from preemptive rights, out of its
authorized but unissued shares or shares held in treasury, reserved for the
purpose of issuance, no less than one hundred five percent (105%) of the number
of shares of Common Stock needed to provide for the issuance of Common Stock
upon conversion of all of the Notes and upon exercise of all the Warrants
without regard to any limitations on conversions or exercise.
The Company will not, by amendment of its certificate of incorporation
or through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities, or any other voluntary action, avoid
or seek to avoid the observance or performance of any of the terms to be
observed or performed by it hereunder. Without limiting the generality of the
foregoing, the Company (i) will not increase the par value of any shares of
Common Stock issuable upon conversion of the Notes above the Conversion Price
then in effect, (ii) will take all such actions as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and non-assessable shares of Common Stock upon conversion of the Notes and (iii)
will not take any action which results in any adjustment of the Conversion Price
if
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the total number of shares of Common Stock issuable after the conversion of all
of the Notes and exercise of all of the Warrants would exceed the total number
of shares of Common Stock then authorized by the Company's certificate of
incorporation and available for the purpose of issue upon such exercise.
The Company covenants that all shares of Common Stock issued upon
conversion of Notes will be fully paid and non-assessable by the Company and
free from all taxes, liens and charges with respect to the issue thereof.
The Company is obligated to register the shares of Common Stock
issuable upon conversion of the Notes for resale under the Securities Act
pursuant to the Registration Rights Agreement. The shares of Common Stock
issuable upon conversion of the Notes shall constitute Registrable Securities
(as such term is defined in the Registration Rights Agreement). Each holder of
Notes shall be entitled to all of the benefits afforded to a holder of any such
Registrable Securities under the Registration Rights Agreement and such holder,
by its acceptance of a Note, agrees and shall agree to be bound by and to comply
with the terms and conditions of the Registration Rights Agreement applicable to
such holder as a holder of such Registrable Securities.
The Company shall use commercially reasonable efforts to promptly
secure the listing of the shares of Common Stock issuable upon conversion of a
Note upon each national securities exchange and automated quotation system, if
any, upon which shares of Common Stock are then listed (subject to official
notice of issuance upon conversion of such Note) and shall use commercially
reasonable efforts to maintain, so long as any other shares of Common Stock
shall be so listed, such listing of all shares of Common Stock from time to time
issuable upon the conversion of all then outstanding Notes; and the Company
shall use commercially reasonable efforts to list on each national securities
exchange or automated quotation system, as the case may be, and shall maintain
such listing of, any other shares of capital stock of the Company issuable upon
conversion of the Notes if and so long as any shares of the same class shall be
listed on such national securities exchange or automated quotation system. The
Company shall pay all fees and expenses in connection with satisfying its
obligations under this Section 15.8.
Except as otherwise specifically provided herein, prior to a
Noteholder's receipt of Common Stock upon conversion of a Note, the Noteholder
shall not be entitled, as such, to any rights of a stockholder of the Company,
including, without limitation, the right to vote or to consent to any action of
the stockholders of the Company, to receive dividends or other distributions, to
exercise any preemptive right or to receive dividends or other distributions, or
to receive any notice of meetings of stockholders of the Company, and shall not
be entitled to receive any notice of any proceedings of the Company. In
addition, nothing contained in this Indenture shall be construed as imposing any
liabilities on such holder to purchase any securities (upon conversion of a Note
or otherwise) or as a stockholder of the Company, whether such liabilities are
asserted by the Company or by creditors of the Company.
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Section 15.9 Responsibility of Trustee
The Trustee and any other 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 extent or calculation of any such adjustment when made,
or with respect to the method employed, or herein or in any supplemental
indenture provided to be employed, in making the same. The Trustee and any other
conversion agent shall not be accountable with respect to the validity or value
(or the kind or amount) of any shares of Common Stock, or of any securities or
property, which may at any time be issued or delivered upon the conversion of
any Note; and the Trustee and any other conversion agent make no representations
with respect thereto. Subject to the provisions of Section 8.1, neither the
Trustee nor any conversion agent shall be responsible for any failure of the
Company to issue, transfer or deliver any shares of Common Stock or stock
certificates or other securities or property or cash upon the surrender of any
Note for the purpose of conversion or to comply with any of the duties,
responsibilities or covenants of the Company contained in this Article. Without
limiting the generality of the foregoing, neither the Trustee nor any conversion
agent shall be under any responsibility to determine whether a supplemental
indenture need be entered into under Section 15.6 or the correctness of any
provisions contained in any supplemental indenture entered into pursuant to such
section relating either to the kind or amount of shares of stock or securities
or property (including cash) receivable by Noteholders upon the conversion of
their Notes after any event referred to in such Section 15.6 or to any
adjustment to be made with respect thereto, but, subject to the provisions of
Section 8.1, may accept as conclusive evidence of the correctness of any such
provisions, and shall be protected in relying upon, the Officer's Certificate
(which the Company shall be obligated to file with the Trustee prior to the
execution of any such supplemental indenture) with respect thereto.
Section 15.10 Notice to Holders Prior to Certain Actions
In case:
(a) the Company shall declare a dividend (or any other
distribution) on its Common Stock; or
(b) the Company shall authorize the granting to the holders of
its Common Stock of rights or warrants to subscribe for or purchase any
share of any class or any other rights or warrants; or
(c) of any reclassification of the Common Stock of the Company
(other than a subdivision or combination of its outstanding Common
Stock, or a change in par value, or from par value to no par value, or
from no par value to par value), or of any consolidation or merger to
which the Company is a party and for which approval of any stockholders
of the Company is required, or of the sale or transfer of all or
substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation
or winding-up of the Company;
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the Company shall cause to be filed with the Trustee and to be mailed to each
holder of Notes at his address appearing on the Note register, provided for in
Section 2.5 of this Indenture, as promptly as possible but in any event at least
fifteen (15) days prior to the applicable date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such
dividend, distribution or rights or warrants, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution or rights are to be determined, or (y) the date
on which such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up is expected to become effective or occur,
and the date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their Common Stock for securities or other
property deliverable upon such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding-up. The Company shall also issue a
press release in connection with any such event, and shall use commercially
reasonable efforts to have such press release available on Bloomberg Business
News. Failure to give such notice, or any defect therein, shall not affect the
legality or validity of such dividend, distribution, reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding-up.
ARTICLE XVI
REPURCHASE UPON A REPURCHASE EVENT
Section 16.1 Repurchase Right
If, at any time prior to August 7, 2008 there shall occur a Repurchase
Event, then each Noteholder shall have the right, at such holder's option, to
require the Company to repurchase all of such holder's Notes, or any portion
thereof (in principal amounts of $1,000 or integral multiples thereof), on the
date (the "repurchase date") that is thirty (30) calendar days after the date of
the Company Notice (as defined in Section 16.2 below) of such Repurchase Event
(or, if such 30th day is not a Business Day, the next succeeding Business Day).
If the Repurchase Event occurs (i) prior to or on August 7, 2004, such
repurchase shall be made in cash at a price equal to 115% of the principal
amount of Notes such holder elects to require the Company to repurchase, (ii)
after August 7, 2004 but prior to or on August 7, 2006, such repurchase shall be
made in cash at a price equal to 110% of the principal amount of Notes such
holder elects to require the Company to repurchase and (iii) after August 7,
2006, but prior to or on August 7, 2008, such repurchase shall be made in cash
at a price equal to 105% of the principal amount of Notes such holder elects to
require the Company to repurchase, together, in each case, with accrued
interest, if any, to the applicable repurchase date; provided, however, that if
such repurchase date is an interest payment date, then the interest becoming due
on such date shall be payable to the holders of such Note registered as such on
the relevant record date subject to the terms and provisions of Section 2.3.
Notwithstanding anything in this Article XVI to the contrary, if a redemption
date pursuant to Article III shall occur prior to any repurchase date
established pursuant to a Company Notice under Section 16.2, provided that the
Company shall have deposited or set aside an amount of money sufficient to
redeem such Notes as set forth in Section 3.2 on or before such repurchase date,
all such Notes shall be redeemed pursuant to Article III and the repurchase
rights hereunder shall have no effect.
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Section 16.2 Notices; Method of Exercising Repurchase Right, Etc.
(a) Unless the Company shall have theretofore called for redemption all
of the outstanding Notes and deposited or set aside an amount of money
sufficient to redeem such Notes on the redemption date as set forth in Section
3.2, on or before the fifth (5th) Business Day following the occurrence of a
Repurchase Event, the Company or, at the written request of the Company, the
Trustee, shall mail to all holders of record of the Notes a notice (the "Company
Notice") in the form as prepared by the Company of the occurrence of the
Repurchase Event and of the repurchase right set forth herein arising as a
result thereof. The Company shall issue a press release with respect to such
Repurchase Event, and shall use commercially reasonable efforts to have such
press release available on Bloomberg Business News. The Company shall also
deliver a copy of such notice of a repurchase right to the Trustee and cause a
copy of such notice of a repurchase right, or a summary of the information
contained therein, to be published once in a newspaper of general circulation in
The City of New York. The Company Notice shall contain the following
information:
(1) the repurchase date;
(2) the CUSIP number(s) of the Note(s) subject to the
repurchase right;
(3) the date by which the repurchase right must be exercised;
(4) the last date by which the election to require repurchase,
if submitted, must be revoked;
(5) the Repurchase Price;
(6) a description of the procedure which a holder must follow
to exercise a repurchase right; and
(7) the Conversion Price then in effect, 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 Notes may be surrendered
for conversion.
No failure of the Company to give the foregoing notices or defect
therein shall limit any holder's right to exercise a repurchase right or affect
the validity of the proceedings for the repurchase of Notes.
If any of the foregoing provisions are inconsistent with applicable
law, such law shall govern.
(b) To exercise a repurchase right, a holder shall deliver to the
Trustee on or before the close of business on the thirty-fifth (35th) day after
the Company Notice was mailed (i) written notice to the Company (or agent
designated by the Company for such purpose) 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, a statement that an
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election to exercise the repurchase right is being made thereby, and
(ii) the Notes with respect to which the repurchase right is being
exercised, duly endorsed for transfer to the Company. Election of
repurchase by a holder shall be revocable at any time prior to, but
excluding, the repurchase date, by delivering written notice to that
effect to the Trustee prior to the close of business on the Business
Day prior to the repurchase date.
(c) If the Company fails to repurchase on the repurchase date
any Notes (or portions thereof) as to which the repurchase right has
been properly exercised, then the principal of such Notes shall, until
paid, bear interest to the extent permitted by applicable law from the
repurchase date at the rate borne by the Note and each such Note shall
be convertible into Common Stock in accordance with this Indenture
(without giving effect to Section 16.2(b)) until the principal of such
Note shall have been paid or duly provided for.
(d) Any Note that is to be repurchased only in part shall be
surrendered to the Trustee duly endorsed for transfer to the Company
and accompanied by appropriate evidence of genuineness and authority
satisfactory to the Company and the Trustee duly executed by, the
holder thereof (or his attorney duly authorized in writing), and the
Company shall execute, and the Trustee shall authenticate and deliver
to the holder of such Note without service charge, a new Note or Notes,
containing identical terms and conditions, of any authorized
denomination as requested by such holder in aggregate principal amount
equal to and in exchange for the unrepurchased portion of the principal
of the Note so surrendered.
(e) On or prior to 10:00 a.m., New York City time on the
repurchase date, the Company shall deposit with the Trustee or with a
paying agent (or, if the Company is acting as its own paying agent,
segregate and hold in trust as provided in Section 5.4) the Repurchase
Price in cash for payment to the holder on the repurchase date.
(f) If the Company is unable to repurchase on the repurchase
date all of the Notes (or portions thereof) as to which the repurchase
right has been properly exercised, the aggregate amount of Notes the
Company may repurchase shall be allocated pro rata among each Note (or
portion thereof) surrendered for repurchase, based on the principal
amount of such Note, in proportion to the aggregate amount of Notes
surrendered for repurchase.
(g) All Notes delivered for repurchase shall be delivered to
the Trustee to be canceled in accordance with the provisions of Section
2.8.
Section 16.3 Certain Definitions
For purposes of this Article XVI:
(a) The term "beneficial owner" shall be determined in
accordance with Rule 13d-3 and 13d-5, as in effect on the date of the
original execution of this Indenture, promulgated by the Commission
pursuant to the Exchange Act.
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(b) The term "person" or "group" shall include any syndicate
or group which would be deemed to be a "person" under Section 13(d) and
14(d) of the Exchange Act as in effect on the date of the original
execution of this Indenture.
(c) The term "Continuing Director" means at any date a member
of the Company's Board of Directors (i) who was a member of such board
on the date of the Securities Purchase Agreement or (ii) who was
nominated or elected by at least a majority of the directors who were
Continuing Directors at the time of such nomination or election or
whose election to the Company's Board of Directors was recommended or
endorsed by at least a majority of the directors who were Continuing
Directors at the time of such nomination or election or such lesser
number comprising a majority of a nominating committee if authority for
such nominations or elections has been delegated to a nominating
committee whose authority and composition have been approved by at
least a majority of the directors who were Continuing Directors at the
time such committee was formed. (Under this definition, if the Board of
Directors of the Company as of the date of this Indenture were to
approve a new director or directors and then resign, no Change in
Control would occur even though all of the current members of the Board
of Directors would thereafter cease to be in office).
(d) The term "Repurchase Event" means a Change in Control, a
Termination of Trading or if the registration statement required to be
filed by the Company pursuant to the Registration Rights Agreement is
not declared effective by the Commission on or before the date that is
180 days after the date the Notes are first issued.
(e) A "Change in Control" shall be deemed to have occurred
when (i) any "person" or "group" (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act) is or becomes the beneficial owner
of shares representing more than 50% of the combined voting power of
the then outstanding securities entitled to vote generally in elections
of directors of the Company (the "Voting Stock"); (ii) approval by the
stockholders of the Company of any plan or proposal for the
liquidation, dissolution or winding up of the Company; (iii) the
Company (A) consolidates with or merges into any other corporation or
any other corporation merges into the Company, and in the case of any
such transaction, the outstanding Common Stock of the Company is
changed or exchanged into other assets or securities as a result,
unless the stockholders of the Company immediately before such
transaction own, directly or indirectly immediately following such
transaction, at least 51% of the combined voting power of the
outstanding voting securities of the corporation resulting from such
transaction in substantially the same proportion as their ownership of
the Voting Stock immediately before such transaction, or (B) conveys,
transfers or leases all or substantially all of its assets to any
Person (other than a wholly-owned subsidiary as a result of which the
Company becomes a holding company); or (iv) any time Continuing
Directors do not constitute a majority of the Board of Directors of the
Company (or, if applicable, a successor corporation to the Company);
provided that a Change in Control shall not be deemed to have occurred
if at least ninety percent (90%) of the consideration (excluding cash
payments for fractional shares) in the transaction or transactions
constituting the Change in Control consists of (and the capital stock
into which the Notes would be convertible consists of) shares of
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capital stock of an entity with a Market Capitalization of at least
$300,000,000 that are, or upon issuance will be, traded on a United
States national securities exchange or approved for trading on an
established automated over-the-counter trading market in the United
States.
(f) A "Termination of Trading" shall have occurred if the
Common Stock (or other common stock into which the Notes are then
convertible) is not listed for trading on a United States national
securities exchange.
(g) The term "Market Capitalization" means the dollar value of
all outstanding shares of an entity, as calculated by multiplying the
number of shares of common stock outstanding times the average of the
daily Closing Prices (as defined in Section 15.5) per share of common
stock of such entity for the ten (10) consecutive Trading Days
immediately prior to the date in question.
ARTICLE XVII
MISCELLANEOUS PROVISIONS
Section 17.1 Provisions Binding on Company's Successors
All the covenants, stipulations, promises and agreements of the Company
contained in this Indenture shall bind its successors and assigns whether so
expressed or not.
Section 17.2 Official Acts by Successor Corporation
Any act or proceeding by any provision of this Indenture authorized or
required to be done or performed by any board, committee or officer of the
Company shall and may be done and performed with like force and effect by the
like board, committee or officer of any corporation that shall at the time be
the lawful sole successor of the Company.
Section 17.3 Addresses for Notices, Etc.
Any notice or demand which by any provision of this Indenture is
required or permitted to be given or served by the Trustee or by the holders of
Notes on the Company and any notice, direction, request or demand hereunder to
or upon the Trustee or to or upon any Noteholder shall be deemed to have been
sufficiently given or made, for all purposes (i) upon receipt, when delivered
personally; (ii) upon receipt, when sent by facsimile; or (iii) one (1) Business
Day after deposit with a nationally recognized overnight delivery service, in
each case properly addressed to the party to receive the same. The addresses and
facsimile numbers of such communications shall be:
If to the Company:
Dave & Buster's, Inc.
2481 Manana Drive
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Dallas, Texas 75220
Telephone: (214) 357-9588
Facsimile: (214) 357-1536
Attention: John Davis, Esq.
Senior Vice President and
General Counsel
If to the Trustee:
The Bank of New York
101 Barclay Street, Floor 8W
New York, New York 10286
Telephone: (212) 815-6907
Facsimile: (212) 815-5707
Attention: Corporate Trust Administration
If to a Noteholder:
At his address as it appears on the Note
register, which shall initially include the
information set forth in the Securities Purchase
Agreement regarding notices
The Trustee, by notice to the Company, may designate additional or
different addresses for subsequent notices or communications. The Trustee shall
use reasonable commercial efforts to provide any notice of default, notice of
redemption and notice of conversion to each holder by facsimile, if and to the
extent such holder's facsimile number is set forth in the Note register.
Failure to give a notice or communication to a Noteholder or any defect
in it shall not affect its sufficiency with respect to other Noteholders. If a
notice or communication is given or made in the manner provided above, it is
duly given or made, whether or not the addressee receives it.
Section 17.4 Governing Law
This Indenture and each Note shall be deemed to be a contract made
under the laws of New York, and for all purposes shall be governed by and
construed in accordance with the laws of New York, including, without
limitation, Section 5-1401 of the New York General Obligations Law.
Section 17.5 Evidence of Compliance with Conditions Precedent;
Certificates to Trustee
Upon any application or demand by the Company to the Trustee to take
any action under any of the provisions of this Indenture, the Company shall
furnish to the Trustee an Officer's Certificate stating that in the opinion of
the person executing such Officer's Certificate all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
satisfied, and an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been satisfied.
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Each certificate or opinion provided for by or on behalf of the Company
in this Indenture and delivered to the Trustee with respect to compliance with a
condition or covenant provided for in this Indenture shall include (1) a
statement that the person making such certificate or opinion has read such
covenant or condition; (2) a brief statement as to the nature and scope of the
examination or investigation upon which the statement or opinion contained in
such certificate or opinion is based; (3) a statement that, in the opinion of
such person, 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 or not, in
the opinion of such person, such condition or covenant has been satisfied or
waived.
Section 17.6 Legal Holidays
In any case where the date of maturity of interest on or principal of
the Notes or the date fixed for redemption of any Note will not be a Business
Day, then payment of such interest on or principal of the Notes need not be made
on such date, but may be made on the next succeeding Business Day with the same
force and effect as if made on the date of maturity or the date fixed for
redemption, and no interest shall accrue for the period from and after such
date.
Section 17.7 No Security Interest Created
Nothing in this Indenture or in the Notes, expressed or implied, shall
be construed to constitute a security interest under the Uniform Commercial Code
or similar legislation, as now or hereafter enacted and in effect, in any
jurisdiction.
Section 17.8 Trust Indenture Act
This Indenture is hereby made subject to, and shall be governed by, the
provisions of the Trust Indenture Act required to be part of and to govern
indentures qualified under the Trust Indenture Act; provided, however, that this
Section 17.8 shall not require that this Indenture or the Trustee be qualified
under the Trust Indenture Act prior to the time such qualification is in fact
required under the terms of the Trust Indenture Act, nor shall it constitute any
admission or acknowledgment by any party hereto that any such qualification is
required prior to the time such qualification is in fact required under the
terms of the Trust Indenture Act. If any provision hereof limits, qualifies or
conflicts with another provision hereof that is required to be included in an
indenture qualified under the Trust Indenture Act, such required provision shall
control.
Section 17.9 Benefits of Indenture
Nothing in this Indenture or in the Notes, expressed or implied, shall
give to any Person, other than the parties hereto, any paying agent, any
authenticating agent, any Note registrar and their successors hereunder, the
holders of Notes and the holders of Senior Indebtedness, any benefit or any
legal or equitable right, remedy or claim under this Indenture.
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Section 17.10 Table of Contents, Headings, Etc.
The table of contents and the titles and headings of the articles and
sections of this Indenture have been inserted for convenience of reference only,
are not to be considered a part hereof, and shall in no way modify or restrict
any of the terms or provisions hereof.
Section 17.11 Authenticating Agent
The Trustee may appoint an authenticating agent which shall be
authorized to act on its behalf and subject to its direction in the
authentication and delivery of Notes in connection with the original issuance
thereof and transfers and exchanges of Notes hereunder, including under Sections
2.4, 2.5, 2.6, 2.7 and 3.3, as fully for all intents and purposes as though the
authenticating agent had been expressly authorized by this Indenture and those
Sections to authenticate and deliver Notes. For all purposes of this Indenture,
the authentication and delivery of Notes by the authenticating agent shall be
deemed to be authentication and delivery of such Notes "by the Trustee" and a
certificate of authentication executed on behalf of the Trustee by an
authenticating agent shall be deemed to satisfy any requirement hereunder or in
the Notes for the Trustee's certificate of authentication. Such authenticating
agent shall at all times be a Person eligible to serve as trustee hereunder
pursuant to Section 8.9.
Any corporation into which any authenticating agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, consolidation or conversion to which any authenticating agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of any authenticating agent, shall be the successor
of the authenticating agent hereunder, if such successor corporation is
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the parties hereto or the authenticating
agent or such successor corporation.
Any authenticating agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at any
time terminate the agency of any authenticating agent by giving written notice
of termination to such authenticating agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
any authenticating agent shall cease to be eligible under this Section, the
Trustee shall promptly appoint a successor authenticating agent (which may be
the Trustee), shall give written notice of such appointment to the Company and
shall mail notice of such appointment to all holders of Notes as the names and
addresses of such holders appear on the Note register.
The Company agrees to pay to the authenticating agent from time to time
reasonable compensation for its services.
The provisions of Sections 8.2, 8.3, 8.4, 9.3 and this Section 17.11
shall be applicable to any authenticating agent.
Section 17.12 Execution in Counterparts
This Indenture may be executed in any number of counterparts, each of
which shall be an original, but such counterparts shall together constitute but
one and the same instrument.
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Section 17.13 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any Subsidiary of the Company. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
The Bank of New York hereby accepts the trusts in this Indenture
declared and provided, upon the terms and conditions hereinabove set forth.
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IN WITNESS WHEREOF, all of the parties hereto have caused this
Indenture to be duly signed as of the date first written above.
DAVE & BUSTER'S, INC.
By:
-------------------------------------------
Name:
Title:
Attest:
- -----------------------------
Name:
Title:
THE BANK OF NEW YORK
as Trustee
By:
-------------------------------------------
Name:
Title:
[SIGNATURE PAGE TO INDENTURE]
EXHIBIT A
Form of 5.0% Convertible Subordinated Note due 2008
EXHIBIT B
Form of Leverage Ratio Certificate
[Company Letterhead]
The Bank of New York
101 Barclay Street, Floor 8W
New York, New York 10286
Attention: Corporate Trust Administration
Reference is made to that Indenture dated as of August 7, 2003 between
Dave & Buster's, Inc., a Missouri corporation (the "Company"), and The Bank of
New York, a New York banking corporation, as trustee (the "Indenture"), pursuant
to which the Company issued the 5.0% Convertible Subordinated Notes due 2008.
Capitalized terms used in this certificate, unless otherwise defined herein,
shall have the meanings ascribed to them in the Indenture.
The undersigned, the Chief Financial Officer of the Company, hereby
certifies in accordance with the requirements of Section 5.10 of the Indenture,
that:
1. On ________ __, 200_, the Company incurred [description of new
LR Indebtedness], which indebtedness qualifies as LR
Indebtedness.
2. Based upon my review of (i) the aggregate LR Indebtedness as
of such date, which amount includes such newly incurred LR
Indebtedness and (ii) the balance sheets and statements of
income of the Company for the preceding four fiscal quarters,
the financial covenant required by Section 5.10 is (check
one):
____ Satisfied
____ Not Satisfied
3. No Event of Default exists on the dater hereof, other than
_________________ [if any Event of Default exists, then
describe, if none, then so state].
4. Attached hereto is a schedule showing the calculations that
support the Company's [compliance/non-compliance] with the
financial covenant required by Section 5.10.
Very truly yours,
-----------------------
Chief Financial Officer