Exhibit 4.1
SIERRA PACIFIC RESOURCES
7.25% Convertible Notes due 2010
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INDENTURE
Dated as of February 14, 2003
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THE BANK OF NEW YORK
TRUSTEE
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CROSS REFERENCE TABLE*
TIA SECTION INDENTURE SECTION
310(a)(1)................................................... 7.08
(a)(2)................................................... 7.08
(a)(3)................................................... N.A.
(a)(4)................................................... N.A.
(b)...................................................... 7.07; 7.09
(c)...................................................... N.A.
311(a)...................................................... 7.12
(b)...................................................... 7.12
(c)...................................................... N.A.
312(a)...................................................... 2.05
(b)...................................................... 13.03
(c)...................................................... 13.03
313(a)...................................................... 7.13
(b)(1)................................................... N.A.
(b)(2)................................................... 7.13
(c)...................................................... 13.02
(d)...................................................... 7.13
314(a)...................................................... 4.02; 4.03; 13.02
(b)...................................................... N.A.
(c)(1)................................................... 13.04
(c)(2)................................................... 13.04
(c)(3)................................................... N.A.
(d)...................................................... 12.01
(e)...................................................... 13.05
(f)...................................................... N.A.
315(a)...................................................... 7.01
(b)...................................................... 7.14; 13.02
(c)...................................................... 7.01
(d)...................................................... 7.01
(e)...................................................... 6.11
316(a) (last sentence)...................................... 2.08
(a)(1)(A)................................................ 6.05
(a)(1)(B)................................................ 6.04
(a)(2)................................................... N.A.
(b)...................................................... 6.07
317(a)(1)................................................... 6.08
(a)(2)................................................... 6.09
(b)...................................................... 2.04
318(a)...................................................... 13.01
N.A. means Not Applicable.
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* Note: This Cross Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
TABLE OF CONTENTS*
PAGE
ARTICLE 1 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION....................................... 1
SECTION 1.01 Definitions.......................................................................... 1
SECTION 1.02 Other Definitions.................................................................... 8
SECTION 1.03 Incorporation by Reference of Trust Indenture Act.................................... 9
SECTION 1.04 Rules of Construction................................................................ 10
SECTION 1.05 Acts of Holders...................................................................... 10
ARTICLE 2 THE NOTES..................................................................................... 11
SECTION 2.01 Form and Dating...................................................................... 11
SECTION 2.02 Execution and Authentication......................................................... 13
SECTION 2.03 Registrar, Paying Agent and Conversion Agent......................................... 13
SECTION 2.04 Paying Agent to Hold Money and Notes in Trust........................................ 14
SECTION 2.05 Noteholder Lists..................................................................... 14
SECTION 2.06 Transfer and Exchange................................................................ 14
SECTION 2.07 Replacement Notes.................................................................... 16
SECTION 2.08 Outstanding Notes; Determinations of Holders' Action................................. 16
SECTION 2.09 Temporary Notes...................................................................... 17
SECTION 2.10 Cancellation......................................................................... 17
SECTION 2.11 Persons Deemed Owners................................................................ 18
SECTION 2.12 Global Notes......................................................................... 18
SECTION 2.13 CUSIP Numbers........................................................................ 22
SECTION 2.14 Defaulted Interest................................................................... 23
ARTICLE 3 REDEMPTION AND PURCHASES...................................................................... 23
SECTION 3.01 Optional Redemption.................................................................. 23
SECTION 3.02 Notice to Trustee.................................................................... 23
SECTION 3.03 Selection of Notes to be Redeemed.................................................... 23
SECTION 3.04 Notice of Redemption................................................................. 24
SECTION 3.05 Effect of Notice of Redemption....................................................... 25
SECTION 3.06 Deposit of Redemption Price.......................................................... 25
SECTION 3.07 Notes Redeemed in Part............................................................... 25
SECTION 3.08 Conversion Arrangement on Call for Redemption........................................ 26
SECTION 3.09 Repurchase of Notes at Option of the Holder upon Change of Control................... 26
SECTION 3.10 Effect of Change of Control Repurchase Notice........................................ 30
SECTION 3.11 Deposit of Change of Control Repurchase Price........................................ 30
SECTION 3.12 Notes Purchased in Part.............................................................. 31
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* Note: This Table of Contents shall not, for any purpose, be deemed to be
part of the Indenture.
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SECTION 3.13 Covenant to Comply with Securities Laws upon Purchase of Notes....................... 31
SECTION 3.14 Repayment to the Company............................................................. 31
ARTICLE 4 COVENANTS..................................................................................... 31
SECTION 4.01 Payment of Principal, Premium, Interest on the Notes................................. 31
SECTION 4.02 SEC and Other Reports................................................................ 32
SECTION 4.03 Compliance Certificate............................................................... 32
SECTION 4.04 Further Instruments and Acts......................................................... 32
SECTION 4.05 Maintenance of Office or Agency...................................................... 32
SECTION 4.06 Delivery of Certain Information...................................................... 33
SECTION 4.07 Additional Interest Notice........................................................... 33
ARTICLE 5 MERGERS AND SALES OF ASSETS................................................................... 33
SECTION 5.01 When Company May Merge or Transfer Assets............................................ 33
ARTICLE 6 DEFAULTS AND REMEDIES......................................................................... 34
SECTION 6.01 Events of Default.................................................................... 34
SECTION 6.02 Acceleration......................................................................... 36
SECTION 6.03 Other Remedies....................................................................... 37
SECTION 6.04 Waiver of Past Defaults.............................................................. 37
SECTION 6.05 Control by Majority.................................................................. 37
SECTION 6.06 Limitation on Suits.................................................................. 37
SECTION 6.07 Rights of Holders to Receive Payment................................................. 38
SECTION 6.08 Collection Suit by Trustee........................................................... 38
SECTION 6.09 Trustee May File Proofs of Claim..................................................... 38
SECTION 6.10 Priorities........................................................................... 39
SECTION 6.11 Undertaking for Costs................................................................ 39
SECTION 6.12 Waiver of Stay, Extension or Usury Laws.............................................. 39
ARTICLE 7 TRUSTEE....................................................................................... 40
SECTION 7.01 Duties and Responsibilities of the Trustee; During Default; Prior to Default......... 40
SECTION 7.02 Certain Rights of the Trustee........................................................ 41
SECTION 7.03 Trustee Not Responsible for Recitals, Disposition of Notes or
Application of Proceeds Thereof...................................................... 43
SECTION 7.04 Trustee and Agents May Hold Notes; Collections, etc.................................. 43
SECTION 7.05 Moneys Held by Trustee............................................................... 43
SECTION 7.06 Compensation and Indemnification of Trustee and Its Prior Claim...................... 43
SECTION 7.07 Conflicting Interests................................................................ 44
SECTION 7.08 Persons Eligible for Appointment as Trustee.......................................... 44
SECTION 7.09 Resignation and Removal; Appointment of Successor Trustee............................ 44
SECTION 7.10 Acceptance of Appointment by Successor Trustee....................................... 45
SECTION 7.11 Merger, Conversion, Consolidation or Succession to Business of Trustee............... 46
SECTION 7.12 Preferential Collection of Claims Against the Company................................ 46
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SECTION 7.13 Reports by the Trustee............................................................... 46
SECTION 7.14 Trustee to Give Notice of Default, But May Withhold in Certain Circumstances......... 47
ARTICLE 8 SATISFACTION AND DISCHARGE OF INDENTURE....................................................... 47
SECTION 8.01 Termination of the Company's Obligations............................................. 47
SECTION 8.02 Application of Trust Money........................................................... 48
SECTION 8.03 Reinstatement........................................................................ 48
SECTION 8.04 Repayment of the Company............................................................. 48
SECTION 8.05 Conversion of Notes Upon Discharge................................................... 48
ARTICLE 9 AMENDMENTS.................................................................................... 49
SECTION 9.01 Without Consent of Holders........................................................... 49
SECTION 9.02 With Consent of Holders.............................................................. 49
SECTION 9.03 Compliance with Trust Indenture Act.................................................. 50
SECTION 9.04 Revocation and Effect of Consents, Waivers and Actions............................... 50
SECTION 9.05 Notation on or Exchange of Notes..................................................... 51
SECTION 9.06 Trustee to Sign Supplemental Indentures.............................................. 51
SECTION 9.07 Effect of Supplemental Indentures.................................................... 51
ARTICLE 10 CONVERSION................................................................................... 51
SECTION 10.01 Conversion Right and Conversion Rate................................................. 51
SECTION 10.02 Exercise of Conversion Right......................................................... 52
SECTION 10.03 Fractions of Shares.................................................................. 54
SECTION 10.04 Adjustment of Conversion Rate........................................................ 54
SECTION 10.05 Notice of Adjustments of Conversion Rate............................................. 65
SECTION 10.06 Notice Prior to Certain Actions...................................................... 65
SECTION 10.07 Company to Reserve Common Stock...................................................... 66
SECTION 10.08 Taxes on Conversions................................................................. 66
SECTION 10.09 Covenant as to Common Stock.......................................................... 66
SECTION 10.10 Cancellation of Converted Notes...................................................... 67
SECTION 10.11 Effect of Reclassification, Consolidation, Merger or Sale............................ 67
SECTION 10.12 Responsibility of Trustee for Conversion Provisions.................................. 68
ARTICLE 11 DIVIDEND PROTECTION PAYMENT.................................................................. 69
SECTION 11.01 Additional Interest Amounts.......................................................... 69
ARTICLE 12 SECURITY..................................................................................... 69
SECTION 12.01 Security............................................................................. 69
ARTICLE 13 MISCELLANEOUS................................................................................ 70
SECTION 13.01 Trust Indenture Act Controls......................................................... 70
SECTION 13.02 Notices.............................................................................. 70
SECTION 13.03 Communication by Holders with Other Holders.......................................... 71
SECTION 13.04 Certificate and Opinion as to Conditions Precedent................................... 71
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SECTION 13.05 Statements Required in Certificate or Opinion........................................ 72
SECTION 13.06 Separability Clause.................................................................. 72
SECTION 13.07 Rules by Trustee, Paying Agent, Conversion Agent and Registrar....................... 72
SECTION 13.08 Legal Holidays....................................................................... 72
SECTION 13.09 GOVERNING LAW........................................................................ 72
SECTION 13.10 No Recourse Against Others........................................................... 73
SECTION 13.11 Successors........................................................................... 73
SECTION 13.12 Multiple Originals................................................................... 73
EXHIBITS
Exhibit A-1 Form of Global Note
Exhibit A-2 Form of Certificated Note
Exhibit B-1 Transfer Certificate
Exhibit B-2 Form of Letter to Be Delivered by Accredited Investors
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INDENTURE dated as of February 14, 2003 between SIERRA PACIFIC
RESOURCES, a Nevada corporation (the "Company"), and THE BANK OF NEW YORK, a New
York banking corporation, as Trustee hereunder (the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of
its 7.25% Convertible Notes due 2010 (herein called the "Notes") of
substantially the tenor and amount hereinafter set forth, and to provide
therefor the Company has duly authorized the execution and delivery of this
Indenture.
All things necessary to make the Notes, when the Notes are
executed by the Company and authenticated and delivered hereunder, the valid
obligations of the Company, and to make this Indenture a valid agreement of the
Company, in accordance with their and its terms, have been done. Further, all
things necessary to duly authorize the issuance of the Common Stock of the
Company issuable upon the conversion of the Notes, and to duly reserve for
issuance the number of shares of Common Stock issuable upon such conversion,
have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Notes by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Notes, as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01 Definitions. For all purposes of this
Indenture, except as otherwise expressly provided or unless the context
otherwise requires:
(1) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
(2) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP; and
(3) the words "herein", "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to
any particular Article, Section or other subdivision.
"Affiliate" of any specified person means any other person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified person. For 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
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otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Note or beneficial interest therein, the rules
and procedures of the Depositary for such Note, in each case to the extent
applicable to such transaction and as in effect from time to time.
"Board of Directors" means the Board of Directors of the
Company or the Executive Committee or any other committee of the Board of
Directors duly authorized to act for the Company hereunder.
"Board Resolution" means a resolution duly adopted by the
Board of Directors, a copy of which, certified by the Secretary or an Assistant
Secretary of the Company to be in full force and effect on the date of such
certification, shall have been delivered to the Trustee.
"Business Day" means each day of the year other than a
Saturday or a Sunday on which banking institutions are not required or
authorized to close in The City of New York.
"Capital Stock" of any corporation means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) stock issued by that
corporation.
"Certificated Notes" means Notes that are in the form of the
Notes attached hereto as Exhibit A-2.
"Closing Price" of any security on any date of determination
means:
(1) the closing sale price (or, if no closing sale price
is reported, the last reported sale price) of such security on the New
York Stock Exchange on such date;
(2) if such security is not listed for trading on the New
York Stock Exchange on any such date, the closing sale price as
reported in the composite transactions for the principal U.S.
securities exchange on which such security is so listed;
(3) if such security is not so listed on a U.S. national
or regional securities exchange, the closing bid price as reported by
the NASDAQ Stock Market;
(4) if such security is not so reported, the last quoted
bid price for such security in the over-the-counter market as reported
by the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the average of
the mid-point of the last bid and ask prices of such security on such
date from at least three nationally recognized independent investment
banking firms retained for this purpose by the Company.
2
"Common Stock" means the Common Stock, par value $1.00 per
share, of the Company as it exists on the date of this Indenture, or, subject to
Section 10.11 hereof, any shares of Capital Stock of the Company into which the
Common Stock shall be reclassified or changed.
"Company" means the party named as the "Company" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by any two Officers.
"Conversion Agent" means any person authorized by the Company
to convert Notes in accordance with Article 10 hereof.
"Corporate Trust Office" means the principal office of the
Trustee at which at any time its corporate trust business shall be administered,
which office at the date hereof is located at 101 Barclay Street, 8W, New York,
New York, 10286, or such other address as the Trustee may designate from time to
time by notice to the Holders and the Company, or the principal corporate trust
office of any successor Trustee (or such other address as a successor Trustee
may designate from time to time by notice to the Holders and the Company).
"Default" means any event which is, or after notice or passage
of time or both would be, an Event of Default.
"Dollar" or "$" means a dollar or other equivalent unit in
such coin or currency of the United States as at the time shall be legal tender
for the payment of public and private debts.
"Exchange Act" means the United States Securities Exchange Act
of 1934 (or any successor statute), as amended from time to time.
"GAAP" means accounting principles generally accepted in the
United States of America, as in effect from time to time.
"Global Notes" means Notes that are in the form of the Notes
attached hereto as Exhibit A-1, and to the extent that such Notes are required
to bear the Legend required by Section 2.06(f), such Notes will be in the form
of a 144A Global Note.
"Government Securities" means the direct obligations of,
obligations fully guaranteed by, or participations in pools consisting solely of
obligations of or obligations guaranteed by the United States of America for the
payment of which guarantee or obligations the full faith and credit of the
United States of America is pledged and which are not callable or redeemable at
the option of the issuer thereof.
"Guarantee" means a guarantee (other than by endorsement of
negotiable instruments for collection in the ordinary course of business),
direct or indirect, in any manner (including, without limitation, letters of
credit and reimbursement agreements in respect thereof), of all or any part of
any Indebtedness.
3
"Holder" or "Noteholder" means a person in whose name a Note
is registered on the Registrar's books.
"Indebtedness" means, with respect to any person, without
duplication:
(a) all liabilities of such person for borrowed money
(including overdrafts) or for the deferred purchase price of property
or services, excluding any trade payables and other accrued current
liabilities incurred in the ordinary course of business, but including,
without limitation, all obligations, contingent or otherwise, of such
person in connection with any letters of credit and acceptances issued
under letter of credit facilities, acceptance facilities or other
similar facilities;
(b) all obligations of such person evidenced by bonds,
notes, debentures or other similar instruments;
(c) indebtedness of such person created or arising under
any conditional sale or other title retention agreement with respect to
property acquired by such person (even if the rights and remedies of
the seller or lender under such agreement in the event of default are
limited to repossession or sale of such property), but excluding trade
payables arising in the ordinary course of business;
(d) all capitalized lease obligations of such person;
(e) all obligations of such person under or in respect of
interest rate agreements or currency agreements;
(f) all indebtedness referred to in (but not excluded
from) the preceding clauses of other persons and all dividends of other
persons, the payment of which is secured by (or for which the holder of
such indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien or with respect to property (including, without
limitation, accounts and contract rights) owned by such person, even
though such person has not assumed or become liable for the payment of
such indebtedness (the amount of such obligation being deemed to be the
lesser of the value of such property or asset or the amount of the
obligation so secured);
(g) all Guarantees by such person of indebtedness
referred to in this definition or of any other person;
(h) all Redeemable Capital Stock of such person valued at
the greater of its voluntary or involuntary maximum fixed repurchase
price plus accrued and unpaid dividends; and
(i) the present value of the obligation of such person as
lessee for net rental payments (excluding all amounts required to be
paid on account of maintenance and repairs, insurance, taxes,
assessments, water, utilities and similar charges to the extent
included in such rental payments) during the remaining term of the
lease included in such sale and leaseback transaction including any
period for which such lease has been extended or may, at the option of
the lessor, be extended. Such present value shall be
4
calculated using a discount rate equal to the rate of interest implicit
in such transaction, determined in accordance with GAAP.
"Indenture" means this Indenture, as amended or supplemented
from time to time in accordance with the terms hereof, including the provisions
of the TIA that are deemed to be a part hereof.
"Institutional Accredited Investor" means an institutional
"accredited investor" as described in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Interest Payment Date" means the Stated Maturity of an
installment of interest on the Notes.
"Interest Rate" means 7.25% per annum.
"Issue Date" of any Note means the date on which the Note was
originally issued or deemed issued as set forth on the face of the Note.
"Lien" means, with respect to any asset, any mortgage, lien,
pledge, charge, security interest or encumbrance of any kind in respect of such
asset given to secure Indebtedness, whether or not filed, recorded or otherwise
perfected under applicable law (including any conditional sale or other title
retention agreement, any lease in the nature thereof, any option or other
agreement to sell or give a security interest in and any filing of or agreement
to give any financing statement under the Uniform Commercial Code (or equivalent
statutes) of any jurisdiction with respect to any such lien, pledge, charge or
security interest).
"Liquidated Damages Amount" shall have the meaning assigned to
such term in the Registration Rights Agreement.
"Notes" has the meaning ascribed to it in the first paragraph
under the caption "Recitals of the Company."
"Officer" means the Chairman of the Board, the President, any
Vice President, the Chief Financial Officer, the Treasurer or Secretary thereof
or any other officer specifically authorized to act by the Board of Directors of
the Company.
"Officers' Certificate" means a written certificate containing
the information specified in Sections 13.04 and 13.05, signed in the name of the
Company by two Officers or by an Officer other than the Secretary and an
Assistant Treasurer or an Assistant Secretary of the Company, and delivered to
the Trustee. An Officers' Certificate given pursuant to Section 4.03 shall be
signed by the principal financial Officer, principal accounting Officer or
principal executive Officer of the Company but need not contain the information
specified in Sections 13.04 and 13.05.
"144A Global Note" means a permanent Global Note in the form
of the Note attached hereto as Exhibit A-1, and that is deposited with and
registered in the name of the Depositary, representing Notes sold in reliance on
Rule 144A under the Securities Act.
5
"Opinion of Counsel" means a written opinion containing the
information specified in Sections 13.04 and 13.05, from legal counsel who is
acceptable to the Trustee and such acceptance shall not be unreasonably
withheld. The counsel may be an employee of, or counsel to, the Company or the
Trustee.
"person" or "Person" means any individual, corporation,
limited liability company, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, or government or any agency or
political subdivision thereof.
"Pledge Account" means an account established by the Trustee
pursuant to the terms of the Pledge Agreement for the deposit of the Pledged
Securities purchased by the Company with a portion of the proceeds from the sale
of the Notes.
"Pledge Agreement" means the Pledge Agreement, dated as of the
date hereof, made by the Company in favor of the Trustee, governing the
disbursement of funds from the Pledge Account, as such agreement may be amended,
restated, supplemented or otherwise modified from time to time, and the term
Pledge Agreement includes the Control Agreement referred to therein and
contemplated thereby, as such agreement may be amended, restated, supplemented
or otherwise modified from time to time.
"Pledged Securities" means the Government Securities to be
purchased by the Company and held in the Pledge Account in accordance with the
Pledge Agreement.
"principal" of a Note means the principal amount due on the
Stated Maturity as set forth on the face of the Note.
"Redeemable Capital Stock" means any class of the Company's
Capital Stock that, either by its terms, by the terms of any securities into
which it is convertible or exchangeable or by contract or otherwise, is, or upon
the happening of an event or passage of time would be, required to be redeemed
(whether by sinking fund or otherwise) prior to the date that is 91 days after
the final scheduled maturity of the Notes or is redeemable at the option of the
holder thereof at any time prior to such date, or is convertible into or
exchangeable for debt securities at any time prior to such date (unless it is
convertible or exchangeable solely at the Company's option).
"Redemption Date" or "redemption date" means the date
specified for redemption of the Notes in accordance with the terms of the Notes
and this Indenture.
"Redemption Price" or "redemption price" when used with
respect to any security to be redeemed, means the price at which it is redeemed
pursuant to this Indenture.
"Registration Rights Agreement" shall mean the registration
rights agreement dated the date hereof between the Company and Merrill Lynch,
Pierce, Fenner & Smith Incorporated.
"Regular Record Date" means, with respect to the interest
payable on any Interest Payment Date, the close of business on January 31 or
July 31 (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
6
"Responsible Officer" means, when used with respect to the
Trustee, any officer within the Corporate Finance Unit of the Corporate Trust
Division of the Trustee (or any successor unit, department or division of the
Trustee) located at the Corporate Trust Office of the Trustee who has direct
responsibility for the administration of the Indenture, and, for the purposes of
clause (b) of the third paragraph of Section 7.01 and Section 7.14 hereof, shall
also include any other officer of the Trustee to whom any corporate trust matter
is referred because of such person's knowledge of and familiarity with the
particular subject.
"Restricted Note" means a Note required to bear the
restrictive legend set forth in the form of Note attached as Exhibits A-1 and
A-2 of this Indenture.
"Rule 144A" means Rule 144A under the Securities Act (or any
successor provision), as it may be amended from time to time.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the United States Securities Act of
1933 (or any successor statute), as amended from time to time.
"Significant Subsidiary" means a Subsidiary of the Company,
including its Subsidiaries, which meets any of the following conditions:
(a) the Company's and its other Subsidiaries' investments
in and advances to such Subsidiary exceed 10 percent of the total
assets of the Company and its Subsidiaries consolidated as of the end
of any two of the three most recently completed fiscal years; or
(b) the Company's and its other Subsidiaries'
proportionate share of the total assets of such Subsidiary exceeds 10
percent of the total assets of the Company and its Subsidiaries
consolidated as of the end of any two of the three most recently
completed fiscal years; or
(c) the Company's and its other Subsidiaries' equity in
the income from continuing operations before income taxes,
extraordinary items and cumulative effect of a change in accounting
principles of such Subsidiary exceeds 10 percent of such income of the
Company and its Subsidiaries consolidated as of the end of any two of
the three most recently completed fiscal years.
"Stated Maturity" when used with respect to any Note or any
installment of interest thereon, means the date specified in such Note as the
fixed date on which the principal of such Note or such installment of interest
is due and payable.
"Subsidiary" means (i) a corporation, a majority of whose
Capital Stock with voting power, under ordinary circumstances, to elect
directors is, at the date of determination, directly or indirectly owned by the
Company, by one or more Subsidiaries of the Company or by the Company and one or
more Subsidiaries of the Company, (ii) a partnership in which the Company or a
Subsidiary of the Company holds a majority interest in the equity capital or
profits of such partnership, or (iii) any other person (other than a corporation
or a partnership) in which the Company, a Subsidiary of the Company or the
Company and one or more Subsidiaries of the
7
Company, directly or indirectly, at the date of determination, has (x) at least
a majority ownership interest or (y) the power to elect or direct the election
of a majority of the directors or other governing body of such person.
"TIA" means the Trust Indenture Act of 1939 as in effect on
the date of this Indenture, provided, however, that in the event the TIA is
amended after such date, TIA means, to the extent required by any such
amendment, the TIA as so amended.
"Trading Day" means a day during which trading in securities
generally occurs on the New York Stock Exchange or, if the Common Stock is not
listed on the New York Stock Exchange, on the principal other national or
regional securities exchange on which the Common Stock is then listed or, if the
Common Stock is not listed on a national or regional securities exchange, on the
National Association of Securities Dealers Automated Quotation System or, if the
Common Stock is not quoted on the National Association of Securities Dealers
Automated Quotation System, on the principal other market on which the Common
Stock is then traded.
"Trustee" means the party named as the "Trustee" in the first
paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"United States" means the United States of America (including
the States and the District of Columbia), its territories, its possessions
(including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake
Island and the Northern Mariana Islands) and other areas subject to its
jurisdiction.
"U.S. Government Obligations" means securities that are (i)
direct obligations of the United States of America for the payment of which its
full faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, are
not callable or redeemable at the option of the issuer thereof at any time prior
to the Stated Maturity of the Notes, and shall also include depository receipts
issued by a bank or trust company as custodian with respect to any such U.S.
Government Obligation or a specific payment of interest on or principal of any
such U.S. Government Obligation held by such custodian for the account of the
holder of a depository receipt; provided that (except as required by law) such
custodian is not authorized to make any deduction from the amount payable to the
holder of such depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or the specific payment of interest on
or principal of the U.S. Government Obligation evidenced by such depository
receipt.
SECTION 1.02 Other Definitions
Defined in
Term Section
---- ----------
"Act"......................................................................... 1.05(a)
"Additional Interest Amount".................................................. 11.01
8
"Additional Interest Payment Notice".......................................... 4.07
"Agent Members"............................................................... 2.12(e)
"Bankruptcy Law".............................................................. 6.01
"Cash Payment Component" ..................................................... 10.01
"Change of Control"........................................................... 3.09(a)
"Change of Control Repurchase Date"........................................... 3.09(a)
"Change of Control Repurchase Notice"......................................... 3.09(c)
"Change of Control Repurchase Price".......................................... 3.09(a)
"Conversion Date"............................................................. 10.02
"Conversion Rate"............................................................. 10.01
"Current Market Price"........................................................ 10.04(h)
"Custodian"................................................................... 6.01
"Depositary".................................................................. 2.01(a)
"DTC"......................................................................... 2.01(a)
"Event of Default"............................................................ 6.01
"excluded securities"......................................................... 10.04(d)
"Expiration Time"............................................................. 10.04(f)
"fair market value"........................................................... 10.04(h)
"Legal Holiday"............................................................... 13.08
"Legend"...................................................................... 2.06(f)
"Non-Electing Share".......................................................... 10.11
"Notice of Default"........................................................... 6.01
"Paying Agent"................................................................ 2.03
"Purchased Shares"............................................................ 10.04(f)
"QIB"......................................................................... 2.01(a)
"Record Date"................................................................. 10.04(h)
"Reference Period"............................................................ 10.04(d)
"Registrar"................................................................... 2.03
"Rule 144A Information"....................................................... 4.06
"Share Payment Component"..................................................... 10.01
"Shareholder Approval Condition".............................................. 10.01
"Trigger Event"............................................................... 10.04(d)
SECTION 1.03 Incorporation by Reference of Trust
Indenture Act. Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Notes.
"indenture security holder" means a Holder or a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
9
"obligor" on the indenture securities means the Company.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by SEC rule have
the meanings assigned to them by such definitions.
SECTION 1.04 Rules of Construction. Unless the context
otherwise requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;
(c) "or" is not exclusive;
(d) "including" means including, without limitation; and
(e) words in the singular include the plural, and words
in the plural include the singular.
SECTION 1.05 Acts of Holders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such Holders
in person or by their agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and conclusive in favor of the
Trustee and the Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of
any such instrument or writing may be proved by the affidavit of a witness of
such execution or by a certificate of a notary public or other officer
authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to such officer the
execution thereof. Where such execution is by a signer acting in a capacity
other than such signer's individual capacity, such certificate or affidavit
shall also constitute sufficient proof of such signer's authority. The fact and
date of the execution of any such instrument or writing, or the authority of the
Person executing the same, may also be proved in any other manner which the
Trustee deems sufficient.
The ownership of Notes shall be proved by the register for the
Notes or by a certificate of the Registrar.
Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Note shall bind every future
Holder of the same Note and the holder of
10
every Note issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustee or the Company in reliance thereon, whether or not
notation of such action is made upon such Note.
If the Company shall solicit from the Holders any request,
demand, authorization, direction, notice, consent, waiver or other Act, the
Company may, at its option, by or pursuant to a resolution of the Board of
Directors, fix in advance a record date for the determination of Holders
entitled to give such request, demand, authorization, direction, notice,
consent, waiver or other Act, but the Company shall have no obligation to do so.
If such a record date is fixed, such request, demand, authorization, direction,
notice, consent, waiver or other Act may be given before or after such record
date, but only the Holders of record at the close of business on such record
date shall be deemed to be Holders for purposes of determining whether Holders
of the requisite proportion of outstanding Notes have authorized or agreed or
consented to such request, demand, authorization, direction, notice, consent,
waiver or other Act, and for that purpose the outstanding Notes shall be
computed as of such record date; provided that no such authorization, agreement
or consent by the Holders on such record date shall be deemed effective unless
it shall become effective pursuant to the provisions of this Indenture not later
than six months after the record date.
ARTICLE 2
THE NOTES
SECTION 2.01 Form and Dating. The Notes and the Trustee's
certificate of authentication to be borne by such Notes shall be substantially
in the form annexed hereto as Exhibits A-1 and A-2, which are incorporated in
and made a part of this Indenture. The terms and provisions contained in the
form of Note shall constitute, and are hereby expressly made, a part of this
Indenture and to the extent applicable, the Company, by its execution and
delivery of this Indenture, and the Holders, by their acceptance of the Notes,
expressly agree to such terms and provisions and to be bound thereby.
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.
(a) 144A Global Notes. Notes offered and sold within the
United States to qualified institutional investors as defined in Rule 144A
("QIBs") in reliance on Rule 144A shall be issued, initially in the form of one
or more 144A Global Notes, which shall be deposited with the Trustee at its
Corporate Trust Office, as custodian for the Depositary (as defined below) and
registered in the name of The Depository Trust Company ("DTC") or the nominee
thereof (such depositary, or any successor thereto, and any such nominee being
hereinafter referred to as the "Depositary"), duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The aggregate principal
amount of the 144A Global Notes may from time to time be
11
increased or decreased by adjustments made on the records of the Trustee and the
Depositary as hereinafter provided.
(b) Certificated Notes. Notes not issued as interests in
the Global Notes will be issued in certificated form substantially in the form
of Exhibit A-2 attached hereto. Except as provided in this Section 2.01, 2.06 or
2.12, owners of beneficial interests in Global Notes will not be entitled to
receive physical delivery of Certificated Notes. Notes offered and sold within
the United States to Institutional Accredited Investors shall be issued,
initially in the form of a Certificated Note, duly executed by the Company and
authenticated by the Trustee as hereinafter provided.
(c) Global Notes in General. 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 amount of outstanding Notes
from time to time endorsed thereon and that the aggregate amount of outstanding
Notes represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, redemptions and conversions.
Any adjustment of the aggregate principal amount of a Global
Note to reflect the amount of any increase or decrease in the amount of
outstanding Notes represented thereby shall be made by the Trustee in accordance
with instructions given by the Holder thereof as required by Section 2.12 hereof
and shall be made on the records of the Trustee and the Depositary as
hereinafter provided.
(d) Book-Entry Provisions. This Section 2.01(d) shall
apply only to Global Notes deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance
with Section 2.02 hereof, authenticate and deliver initially one or more Global
Notes that (a) shall be registered in the name of the Depositary or its nominee,
(b) shall be delivered by the Trustee to the Depositary or pursuant to the
Depositary's instructions and (c) shall bear legends substantially to the
following effect:
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
12
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS
OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE
WITH THE RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF."
SECTION 2.02 Execution and Authentication. The Notes
shall be executed on behalf of the Company by any Officer, under its corporate
seal reproduced thereon. The signature of the Officer on the Notes may be manual
or facsimile.
Notes bearing the manual or facsimile signatures of
individuals who were at the time of the execution of the Notes the proper
Officers of the Company shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Notes or did not hold such offices at the
date of authentication of such Notes.
No Note shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose unless there appears on such Note a
certificate of authentication substantially in the form provided for herein duly
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Note shall be conclusive evidence, and the only evidence,
that such Note has been duly authenticated and delivered hereunder.
The Trustee shall authenticate and deliver Notes for original
issue in an aggregate principal amount of up to $300,000,000 upon a Company
Order without any further action by the Company. The aggregate principal amount
of Notes outstanding at any time may not exceed the amount set forth in the
foregoing sentence, except as provided in Section 2.07.
The Notes shall be issued only in registered form without
coupons and only in denominations of $1,000 in principal amount and any integral
multiple thereof.
SECTION 2.03 Registrar, Paying Agent and Conversion
Agent. The Company shall maintain an office or agency where Notes may be
presented for registration of transfer or for exchange ("Registrar"), an office
or agency where Notes may be presented for purchase or payment ("Paying Agent")
and an office or agency where Notes may be presented for conversion (together
with any other person authorized by the Company to convert Notes in accordance
with the provisions of Article 10 hereof, the "Conversion Agent"). The Registrar
shall keep a register of the Notes and of their transfer and exchange. The
Company may have one or more co-Registrars, one or more additional Paying Agents
and one or more additional Conversion Agents. The term Paying Agent includes any
additional paying agent, including any named pursuant to Section 4.05. The term
Conversion Agent includes any additional conversion agent, including any named
pursuant to Section 4.05.
The Company shall enter into appropriate agency agreements
with any Registrar, Paying Agent, Conversion Agent or co-Registrar, if other
than the Trustee. The agreement shall implement the provisions of this Indenture
that relate to such agent. The Company shall notify
13
the Trustee of the name and address of any such agent. If the Company fails to
maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act as
such and shall be entitled to appropriate compensation therefor pursuant to
Section 7.06. The Company or any Subsidiary or an Affiliate of either of them
may act as Paying Agent, Registrar, Conversion Agent and/or co-Registrar.
The Company initially appoints the Trustee as Registrar,
Conversion Agent and Paying Agent in connection with the Notes.
SECTION 2.04 Paying Agent to Hold Money and Notes in
Trust. Except as otherwise provided herein, on or prior to each due date of
payments in respect of any Note, the Company shall deposit with the Paying Agent
a sum of money (in immediately available funds if deposited on the due date) or
Common Stock (pursuant to Section 3.10 hereof) sufficient to make such payments
when so becoming due. The Company shall require each Paying Agent (if other than
the Trustee) to agree in writing that the Paying Agent shall hold in trust for
the benefit of Noteholders or the Trustee all money and Common Stock held by the
Paying Agent for the making of payments in respect of the Notes and shall notify
the Trustee of any default by the Company in making any such payment. At any
time during the continuance of any such default, the Paying Agent shall, upon
the written request of the Trustee, forthwith pay to the Trustee all money and
Common Stock so held in trust. If the Company, a Subsidiary or an Affiliate of
either of them acts as Paying Agent, it shall segregate the money and Common
Stock held by it as Paying Agent and hold it as a separate trust fund. The
Company at any time may require a Paying Agent to pay all money and Common Stock
held by it to the Trustee and to account for any funds and Common Stock
disbursed by it. Upon doing so, the Paying Agent shall have no further liability
for the money or Common Stock.
SECTION 2.05 Noteholder Lists. The Trustee shall preserve
in as current a form as is reasonably practicable the most recent list available
to it of the names and addresses of Noteholders. If the Trustee is not the
Registrar, the Company shall cause to be furnished to the Trustee at least
semiannually on January 31 and July 31 a listing of Noteholders dated within 15
days of the date on which the list is furnished and at such other times as the
Trustee may request in writing a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Noteholders.
SECTION 2.06 Transfer and Exchange. Subject to Section
2.12 hereof, (a) upon surrender for registration of transfer of any Note,
together with a written instrument of transfer satisfactory to the Registrar
duly executed by the Noteholder or such Noteholder's attorney duly authorized in
writing, at the office or agency of the company designated as Registrar or
co-registrar pursuant to Section 2.03, 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 denomination or
denominations, of a like aggregate principal amount. The Company shall not
charge a service charge for any registration of transfer or exchange, but the
Company may require payment of a sum sufficient to pay all taxes, assessments or
other governmental charges that may be imposed in connection with the transfer
or exchange of the Notes from the Noteholder requesting such transfer or
exchange.
14
At the option of the Holder, Notes may be exchanged for other
Notes of any authorized denomination or denominations, of a like aggregate
principal amount, upon surrender of the Notes to be exchanged, together with a
written instrument of transfer satisfactory to the Registrar duly executed by
the Noteholder or such Noteholder's attorney duly authorized in writing, at such
office or agency. Whenever any Notes are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the Notes
which the Holder making the exchange is entitled to receive.
The Company shall not be required to make, and the Registrar
need not register, transfers or exchanges of Notes selected for redemption
(except, in the case of Notes to be redeemed in part, the portion thereof not to
be redeemed) or any Notes in respect of which a Change of Control Repurchase
Notice (as defined in Section 3.09(c)) has been given and not withdrawn by the
Holder thereof in accordance with the terms of this Indenture (except, in the
case of Notes to be purchased in part, the portion thereof not to be purchased)
or any Notes for a period of 15 days before the mailing of a notice of
redemption of Notes to be redeemed.
(b) Notwithstanding any provision to the contrary herein,
so long as a Global Note remains outstanding and is held by or on behalf of the
Depositary, transfers of a Global Note, in whole or in part, shall be made only
in accordance with Section 2.12 and this Section 2.06(b). Transfers of a Global
Note shall be limited to transfers of such Global Note in whole, or in part, to
nominees of the Depositary or to a successor of the Depositary or such
successor's nominee.
(c) Successive registrations and registrations of
transfers and exchanges as aforesaid may be made from time to time as desired,
and each such registration shall be noted on the register for the Notes.
(d) Any Registrar appointed pursuant to Section 2.03
hereof shall provide to the Trustee such information as the Trustee may
reasonably require in connection with the delivery by such Registrar of Notes
upon transfer or exchange of Notes.
(e) No Registrar shall be required to make registrations
of transfer or exchange of Notes during any periods designated in the text of
the Notes or in this Indenture as periods during which such registration of
transfers and exchanges need not be made.
(f) If Notes are issued upon the transfer, exchange or
replacement of Notes subject to restrictions on transfer and bearing the legends
set forth on the form of Note attached hereto as Exhibits A-1 and A-2 setting
forth such restrictions (collectively, the "Legend"), or if a request is made to
remove the Legend on a Note, the Notes so issued shall bear the Legend, or the
Legend shall not be removed, as the case may be, unless there is delivered to
the Company and the Registrar such satisfactory evidence, which shall include an
Opinion of Counsel, as may be reasonably required by the Company and the
Registrar, that neither the Legend nor the restrictions on transfer set forth
therein are required to ensure that transfers thereof comply with the provisions
of Rule 144A or Rule 144 under the Securities Act or that such Notes are not
"restricted" within the meaning of Rule 144 under the Securities Act. Upon (i)
provision of such satisfactory evidence, or (ii) notification by the Company to
the Trustee and Registrar of the sale of such Note pursuant to a registration
statement that is effective at the time of such sale, the
15
Trustee, at the written direction of the Company, shall authenticate and deliver
a Note that does not bear the Legend. If the Legend is removed from the face of
a Note and the Note is subsequently held by an Affiliate of the Company, the
Legend shall be reinstated.
SECTION 2.07 Replacement Notes. If (a) any mutilated Note
is surrendered to the Trustee, or (b) the Company and the Trustee receive
evidence to their satisfaction of the destruction, loss or theft of any Note,
and there is delivered to the Company and the Trustee such Note or indemnity as
may be required by them to save each of them harmless, then, in the absence of
notice to the Company or the Trustee that such Note has been acquired by a bona
fide purchaser, the Company shall execute and upon its written request the
Trustee shall authenticate and deliver, in exchange for any such mutilated Note
or in lieu of any such destroyed, lost or stolen Note, a new Note of like tenor
and principal amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Note has
become or is about to become due and payable, or is about to be purchased by the
Company pursuant to Article 3 hereof, the Company in its discretion may, instead
of issuing a new Note, pay or purchase such Note, as the case may be.
Upon the issuance of any new Notes under this Section 2.07,
the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section 2.07 in lieu of
any mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed,
lost or stolen Note shall be at any time enforceable by anyone, and shall be
entitled to all benefits of this Indenture equally and proportionately with any
and all other Notes duly issued hereunder.
The provisions of this Section 2.07 are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.08 Outstanding Notes; Determinations of
Holders' Action. Notes outstanding at any time are all the Notes authenticated
by the Trustee except for those cancelled by it or delivered to it for
cancellation, those paid pursuant to Section 2.07 and those described in this
Section 2.08 as not outstanding. A Note does not cease to be outstanding because
the Company or an Affiliate thereof holds the Note; provided, however, that in
determining whether the Holders of the requisite principal amount of the
outstanding Notes have given or concurred in any request, demand, authorization,
direction, notice, consent or waiver hereunder, Notes owned by the Company or
any other obligor upon the Notes or any Affiliate of the Company or such other
obligor shall be disregarded and deemed not to be outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only Notes
which a Responsible Officer of the Trustee actually knows to be so owned shall
be so disregarded. Subject to the foregoing, only Notes outstanding at the time
of such determination shall be
16
considered in any such determination (including, without limitation,
determinations pursuant to Articles 6 and 9).
If a Note is replaced pursuant to Section 2.07, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture,
on a Redemption Date, or on the Business Day following the Change of Control
Repurchase Date, or on Stated Maturity, money or securities, if permitted
hereunder, sufficient to pay Notes payable on that date, then immediately after
such Redemption Date, Change of Control Repurchase Date or Stated Maturity, as
the case may be, such Notes shall cease to be outstanding and interest on such
Notes shall cease to accrue; provided that, if such Notes are to be redeemed,
notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made.
If a Note is converted in accordance with Article 10, then
upon conversion of such Note and in accordance with Section 10.02, such Note
shall cease to be outstanding and interest shall cease to accrue on such Note.
SECTION 2.09 Temporary Notes. Pending the preparation of
definitive Notes, the Company may execute, and upon Company Order the Trustee
shall authenticate and deliver, temporary Notes which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Notes in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Notes may determine, as conclusively
evidenced by their execution of such Notes.
If temporary Notes are issued, the Company will cause
definitive Notes to be prepared without unreasonable delay. After the
preparation of definitive Notes, the temporary Notes shall be exchangeable for
definitive Notes upon surrender of the temporary Notes at the office or agency
of the Company designated for such purpose pursuant to Section 2.03, without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Notes the Company shall execute and the Trustee shall authenticate and
deliver in exchange therefor a like principal amount of definitive Notes of
authorized denominations. Until so exchanged the temporary Notes shall in all
respects be entitled to the same benefits under this Indenture as definitive
Notes.
SECTION 2.10 Cancellation. All Notes surrendered for
payment, purchase by the Company pursuant to Article 3, conversion, redemption
or registration of transfer or exchange shall, if surrendered to any person
other than the Trustee, be delivered to the Trustee and shall be promptly
cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Notes previously authenticated and delivered hereunder which
the Company may have acquired in any manner whatsoever, and all Notes so
delivered shall be promptly cancelled by the Trustee. The Company may not issue
new Notes to replace Notes it has paid or delivered to the Trustee for
cancellation or that any Holder has converted pursuant to Article 10. No Notes
shall be authenticated in lieu of or in exchange for any Notes cancelled as
provided in
17
this Section 2.10, except as expressly permitted by this Indenture. All
cancelled Notes held by the Trustee shall be disposed of by the Trustee in
accordance with its customary procedures in effect at the time and the Trustee
shall deliver a certificate of destruction to the Company.
SECTION 2.11 Persons Deemed Owners. Prior to due
presentment of a Note for registration of transfer, the Company, the Trustee and
any agent of the Company or the Trustee may treat the Person in whose name such
Note is registered as the owner of such Note for the purpose of receiving
payment of principal of the Note or the payment of any Redemption Price or
Change of Control Repurchase Price in respect thereof, and interest thereon, for
the purpose of conversion and for all other purposes whatsoever, whether or not
such Note be overdue, and neither the Company, the Trustee nor any agent of the
Company or the Trustee shall be affected by notice to the contrary.
SECTION 2.12 Global Notes. (a) Notwithstanding any other
provisions of this Indenture or the Notes, (A) transfers of a Global Note, in
whole or in part, shall be made only in accordance with Section 2.06 and Section
2.12(a)(i), (B) transfer of a beneficial interest in a Global Note for a
Certificated Note shall comply with Section 2.06 and Section 2.12(a)(ii) below,
and (C) transfers of a Certificated Note shall comply with Section 2.06 and
Section 2.12(a)(iii) and (iv) below.
(i) Transfer of Global Note. A Global Note may not be
transferred, in whole or in part, to any Person other than the
Depositary or a nominee or any successor thereof, and no such transfer
to any such other Person may be registered; provided that this clause
(i) shall not prohibit any transfer of a Note that is issued in
exchange for a Global Note but is not itself a Global Note. No transfer
of a Note to any Person shall be effective under this Indenture or the
Notes unless and until such Note has been registered in the name of
such Person. Nothing in this Section 2.12(a)(i) shall prohibit or
render ineffective any transfer of a beneficial interest in a Global
Note effected in accordance with the other provisions of this Section
2.12(a).
(ii) Restrictions on Transfer of a Beneficial Interest in
a Global Note for a Certificated Note. A beneficial interest in a
Global Note may not be exchanged for a Certificated Note except upon
satisfaction of the requirements set forth below. Upon receipt by the
Trustee of a transfer of a beneficial interest in a Global Note in
accordance with Applicable Procedures for a Certificated Note in the
form satisfactory to the Trustee, together with:
(a) so long as the Notes are Restricted Notes,
certification, in the form set forth in Exhibit B-1, and, if
requested by the Company or the Registrar, certification in
the form set forth in Exhibit B-2, that such beneficial
interest in the Global Note is being transferred to an
Institutional Accredited Investor;
(b) written instructions to the Trustee to make,
or direct the Registrar to make, an adjustment on its books
and records with respect to such Global Note to reflect a
decrease in the aggregate principal amount of the Notes
represented by the Global Note, such instructions to contain
information regarding the Depositary account to be credited
with such decrease; and
18
(c) if the Company or Registrar so requests, an
opinion of counsel or other evidence reasonably satisfactory
to them as to the compliance with the restrictions set forth
in the Legend,
then the Trustee shall cause, or direct the Registrar to cause, in
accordance with the standing instructions and procedures existing
between the Depositary and the Registrar, the aggregate principal
amount of Notes represented by the Global Note to be decreased by the
aggregate principal amount of the Certificated Note to be issued, shall
issue such Certificated Note and shall debit or cause to be debited to
the account of the Person specified in such instructions a beneficial
interest in the Global Note equal to the principal amount of the
Certificated Note so issued.
(iii) Transfer and Exchange of Certificated Notes. When
Certificated Notes are presented to the Registrar with a request:
(x) to register the transfer of such
Certificated Notes; or
(y) to exchange such Certificated Notes for an
equal principal amount of Certificated Notes of other
authorized denominations,
the Registrar shall register the transfer or make the exchange as
requested if its reasonable requirements for such transaction are met;
provided, however, that the Certificated Notes surrendered for transfer
or exchange:
(a) shall be duly endorsed or accompanied by a
written instrument of transfer in form reasonably satisfactory
to the Company and the Registrar, duly executed by the Holder
thereof or his attorney duly authorized in writing; and
(b) so long as such Notes are Restricted Notes,
such Notes are being transferred or exchanged pursuant to an
effective registration statement under the Securities Act or
pursuant to clause (A), (B) or (C) below, and are accompanied
by the following additional information and documents, as
applicable:
(A) if such Certificated Notes are
being delivered to the Registrar by a Holder for
registration in the name of such Holder, without
transfer, a certification from such Holder to that
effect; or
(B) if such Certificated Notes are
being transferred to the Company, a certification to
that effect; or
(C) if such Certificated Notes are
being transferred pursuant to an exemption from
registration, (i) a certification to that effect (in
the form set forth in Exhibits B-1 and B-2, if
applicable) and (ii) if the Company or Registrar so
requests, an opinion of counsel or other evidence
reasonably satisfactory to them as to the compliance
with the restrictions set forth in the Legend.
19
(iv) Restrictions on Transfer of a Certificated Note for a
Beneficial Interest in a Global Note. A Certificated Note may not be
exchanged for a beneficial interest in a Global Note except upon
satisfaction of the requirements set forth below. Upon receipt by the
Trustee of a Certificated Note, duly endorsed or accompanied by
appropriate instruments of transfer, in form satisfactory to the
Trustee, together with:
(A) so long as the Notes are Restricted Notes,
certification, in the form set forth in Exhibit B-1, that such
Certificated Note is being transferred to a Qualified
Institutional Buyer in accordance with Rule 144A; and
(B) written instructions directing the Trustee
to make, or to direct the Registrar to make, an adjustment on
its books and records with respect to such Global Note to
reflect an increase in the aggregate principal amount of the
Notes represented by the Global Note, such instructions to
contain information regarding the Depositary account to be
credited with such increase,
then the Trustee shall cancel such Certificated Note and cause, or
direct the Registrar to cause, in accordance with the standing
instructions and procedures existing between the Depositary and the
Registrar, the aggregate principal amount of Notes represented by the
Global Note to be increased by the aggregate principal amount of the
Certificated Note to be exchanged, and shall credit or cause to be
credited to the account of the Person specified in such instructions a
beneficial interest in the Global Note equal to the principal amount of
the Certificated Note so cancelled. If no Global Notes are then
outstanding, the Company shall issue and the Trustee shall
authenticate, upon written order of the Company in the form of an
Officers' Certificate, a new Global Note in the appropriate principal
amount.
(b) Subject to the succeeding paragraph, every Note shall
be subject to the restrictions on transfer provided in the Legend including the
delivery of an opinion of counsel, if so provided. Whenever any Restricted Note
is presented or surrendered for registration of transfer or for exchange for a
Note registered in a name other than that of the Holder, such Note must be
accompanied by a certificate in substantially the form set forth in Exhibit B-1,
dated the date of such surrender and signed by the Holder of such Note, as to
compliance with such restrictions on transfer. The Registrar shall not be
required to accept for such registration of transfer or exchange any Note not so
accompanied by a properly completed certificate.
(c) The restrictions imposed by the Legend upon the
transferability of any Note shall cease and terminate when such Note has been
sold pursuant to an effective registration statement under the Securities Act or
transferred in compliance with Rule 144 under the Securities Act (or any
successor provision thereto) or, if earlier, upon the expiration of the holding
period applicable to sales thereof under Rule 144(k) under the Securities Act
(or any successor provision). Any Note as to which such restrictions on transfer
shall have expired in accordance with their terms or shall have terminated may,
upon a surrender of such Note for exchange to the Registrar in accordance with
the provisions of this Section 2.12 (accompanied, in the event that such
restrictions on transfer have terminated by reason of a transfer in compliance
with Rule 144 or any successor provision, by an opinion of counsel having
substantial experience in practice under the Securities Act and otherwise
reasonably acceptable
20
to the Company, addressed to the Company and in form acceptable to the Company,
to the effect that the transfer of such Note has been made in compliance with
Rule 144 or such successor provision), be exchanged for a new Note, of like
tenor and aggregate principal amount, which shall not bear the restrictive
Legend. The Company shall inform the Trustee of the effective date of any
registration statement registering the Notes under the Securities Act. The
Trustee shall not be liable for any action taken or omitted to be taken by it in
good faith in accordance with the aforementioned opinion of counsel or
registration statement.
(d) As used in the preceding two paragraphs of this
Section 2.12, the term "transfer" encompasses any sale, pledge, transfer,
hypothecation or other disposition of any Note.
(e) The provisions below shall apply only to Global
Notes:
(1) Notwithstanding any other provisions of this
Indenture or the Notes, except as provided in Section 2.12(a)(ii), a
Global Note shall not be exchanged in whole or in part for a Note
registered in the name of any Person other than the Depositary or one
or more nominees thereof, provided that a Global Note may be exchanged
for Notes registered in the names of any person designated by the
Depositary in the event that (i) the Depositary has notified the
Company that it is unwilling or unable to continue as Depositary for
such Global Note or such Depositary has ceased to be a "clearing
agency" registered under the Exchange Act, and a successor Depositary
is not appointed by the Company within 90 days or (ii) an Event of
Default has occurred and is continuing with respect to the Notes. Any
Global Note exchanged pursuant to clause (i) above shall be so
exchanged in whole and not in part, and any Global Note exchanged
pursuant to clause (ii) above may be exchanged in whole or from time to
time in part as directed by the Depositary. Any Note issued in exchange
for a Global Note or any portion thereof shall be a Global Note;
provided that any such Note so issued that is registered in the name of
a Person other than the Depositary or a nominee thereof shall not be a
Global Note.
(2) Notes issued in exchange for a Global Note or any
portion thereof shall be issued in definitive, fully registered form,
without interest coupons, shall have an aggregate principal amount
equal to that of such Global Note or portion thereof to be so
exchanged, shall be registered in such names and be in such authorized
denominations as the Depositary shall designate and shall bear the
applicable legends provided for herein. Any Global Note to be exchanged
in whole shall be surrendered by the Depositary to the Trustee, as
Registrar. With regard to any Global Note to be exchanged in part,
either such Global Note shall be so surrendered for exchange or, if the
Trustee is acting as custodian for the Depositary or its nominee with
respect to such Global Note, the principal amount thereof shall be
reduced, by an amount equal to the portion thereof to be so exchanged,
by means of an appropriate adjustment made on the records of the
Trustee. Upon any such surrender or adjustment, the Trustee shall
authenticate and deliver the Note issuable on such exchange to or upon
the order of the Depositary or an authorized representative thereof.
(3) Subject to the provisions of clause (5) below, the
registered Holder may grant proxies and otherwise authorize any Person,
including Agent Members (as defined
21
below) and persons that may hold interests through Agent Members, to
take any action which a holder is entitled to take under this Indenture
or the Notes.
(4) In the event of the occurrence of any of the events
specified in clause (1) above, the Company will promptly make available
to the Trustee a reasonable supply of Certificated Notes in definitive,
fully registered form, without interest coupons.
(5) Neither any members of, or participants in, the
Depositary (collectively, the "Agent Members") nor any other Persons on
whose behalf Agent Members may act shall have any rights under this
Indenture with respect to any Global Note registered in the name of the
Depositary or any nominee thereof, or under any such Global Note, and
the Depositary or such nominee, as the case may be, 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 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 such nominee, as the case
may be, or impair, as between the Depositary, its Agent Members and any
other person on whose behalf an Agent Member may act, the operation of
customary practices of such Persons governing the exercise of the
rights of a holder of any Note.
(6) Each Holder of a Note agrees to indemnify the Trustee
against any liability that may result from the transfer, exchange or
assignment of such Holder's Note in violation of any provision of this
Indenture and/or applicable United States Federal or state securities
law.
(7) The Trustee shall have no responsibility or
obligation to any beneficial owner of an interest in a Global Note, a
member of, or a participant in, DTC or other Person with respect to the
accuracy of the records of DTC or its nominee or of any participant or
member thereof, with respect to any ownership interest in the Notes or
with respect to the delivery to any participant, member, beneficial
owner or other Person (other than DTC) of any notice or the payment of
any amount under or with respect to such Notes.
(8) 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 (including any
transfers between or among Agent Members or beneficial owners of
interests in any Global 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.
SECTION 2.13 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
22
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.
SECTION 2.14 Defaulted Interest. If the Company defaults
in a payment of interest on the Notes, it shall pay, or shall deposit with the
Paying Agent, money in immediately available funds sufficient to pay, the
defaulted interest, plus (to the extent lawful) any interest payable on the
defaulted interest, to the Persons who are Holders on a subsequent special
record date. A special record date, as used in this Section 2.14 with respect to
the payment of any defaulted interest, shall mean the 15th day next preceding
the date fixed by the Company for the payment of defaulted interest, whether or
not such day is a Business Day. At least 15 days before the subsequent special
record date, the Company shall mail to each Holder and to the Trustee a notice
that states the subsequent special record date, the payment date and the amount
of defaulted interest to be paid.
ARTICLE 3
REDEMPTION AND PURCHASES
SECTION 3.01 Optional Redemption. The Notes are not
redeemable prior to February 14, 2008. On and after February 14, 2008, the
Company may, at its option, redeem the Notes for cash, in whole at any time or
in part from time to time, on any date prior to maturity, upon notice as set
forth in Section 3.04, at the following prices (expressed in percentages of the
principal amount) (the "Redemption Price"), together with accrued and unpaid
interest to, but excluding, the date fixed for redemption (the "Redemption
Date"), subject to the right of Holders of record on the immediately preceding
Regular Record Date to receive the interest due on the succeeding Interest
Payment Date.
During the twelve months commencing February 14 of the years
set forth below:
Year Redemption Price
---- ----------------
2008................................................. 102.1%
2009................................................. 101.0%
SECTION 3.02 Notice to Trustee. If the Company elects to
redeem Notes pursuant to Section 3.01 hereof, it shall notify the Trustee at
least 30 days prior but not more than 60 days prior to the Redemption Date of
such intended Redemption Date, the principal amount of Notes to be redeemed and
the CUSIP numbers of the Notes to be redeemed.
SECTION 3.03 Selection of Notes to be Redeemed. If fewer
than all the Notes are to be redeemed, the Trustee shall select the particular
Notes to be redeemed from the outstanding Notes on a pro rata basis or by lot or
in accordance with any other method of Trustee considers fair and appropriate.
Notes and portions thereof that the Trustee selects shall be in principal
amounts equal to $1,000 or any integral multiple thereof.
23
If any Note selected for partial redemption is converted in
part before termination of the conversion right with respect to the portion of
the Note so selected, the converted portion of such Note shall be deemed to be
first taken from the portion selected for redemption (provided, however, that
the Holder of such Note so converted and deemed redeemed shall not be entitled
to any additional interest payment as a result of such deemed redemption than
such Holder would have otherwise been entitled to receive upon conversion of
such Note). Notes which have been converted during a selection of Notes to be
redeemed may be treated by the Trustee as outstanding for the purpose of such
selection.
The Trustee shall promptly notify the Company and the
Registrar (if other than the Trustee) in writing of the Notes selected for
redemption and, in the case of any Notes selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Notes shall
relate, in the case of any Notes redeemed or to be redeemed only in part, to the
portion of the principal amount of such Notes which has been or is to be
redeemed.
SECTION 3.04 Notice of Redemption. Notice of redemption
shall be given in the manner provided in Section 13.02 hereof to the Holders of
Notes to be redeemed. Such notice shall be given not less than 30 nor more than
60 days prior to the Redemption Date for redemption pursuant to Section 3.01.
All notices of redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price and interest accrued and unpaid
to the Redemption Date, if any;
(3) if fewer than all the outstanding Notes are to be
redeemed, the aggregate principal amount of Notes to be redeemed and
the aggregate principal amount of Notes which will be outstanding after
such partial redemption;
(4) that on the Redemption Date the Redemption Price and
interest accrued and unpaid to the Redemption Date, if any, will become
due and payable upon each such Note to be redeemed, and that (unless
the Company defaults in making payment of the Redemption Price)
interest thereon shall cease to accrue on and after such date;
(5) the Conversion Rate, the date on which the right to
convert the principal of the Notes to be redeemed will terminate and
the places where such Notes may be surrendered for conversion;
(6) in the event that the Shareholder Approval Condition
shall have been satisfied, the election of the Company (which, subject
to the provisions of Article 10 of this Indenture, shall be
irrevocable) to pay the Cash Payment Component or to deliver shares of
Common Stock in lieu of such Cash Payment Component with respect to any
24
Note (or portion thereof) that may be exchanged after mailing of such
notice prior to the Redemption Date;
(7) the place or places where such Notes are to be
surrendered for payment of the Redemption Price and accrued and unpaid
interest, if any; and
(8) the CUSIP number of the Notes.
The notice given shall specify the last date, if any be
applicable, on which exchanges or transfers of Notes may be made pursuant to
Section 2.06 hereof.
Notice of redemption of Notes to be redeemed at the election
of the Company shall be given by the Company.
SECTION 3.05 Effect of Notice of Redemption. Notice of
redemption having been given as provided in Section 3.04 hereof, the Notes so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued and
unpaid interest) such Notes shall cease to bear interest. Upon surrender of any
such Note for redemption in accordance with such notice, such Note shall be paid
by the Company at the Redemption Price plus accrued and unpaid interest, if any;
provided, however, that the installments of interest on Notes whose Stated
Maturity is prior to or on the Redemption Date shall be payable to the Holders
of such Notes, or one or more Predecessor Notes, registered as such on the
relevant Record Date according to their terms and the provisions of Section 2.01
hereof.
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, bear interest from the Redemption Date at the Interest Rate.
SECTION 3.06 Deposit of Redemption Price. Prior to 10:00
a.m. (New York City time) on any Redemption Date, the Company shall deposit with
the Trustee or with the Paying Agent (or, if the Company or a Subsidiary or an
Affiliate of either of them is acting as the Paying Agent, shall segregate and
hold in trust as provided in Section 2.04) an amount of money (in immediately
available funds) sufficient to pay the Redemption Price of all the Notes to be
redeemed on that Redemption Date, other than any Notes called for redemption on
that date which have been converted prior to the date of such deposit, and
accrued and unpaid interest, if any, on such Notes.
If any Note called for redemption is converted, any money
deposited with the Trustee or with the Paying Agent or so segregated and held in
trust for the redemption of such Note shall (subject to any right of the Holder
of such Note or any Predecessor Note to receive interest as provided in Section
4.01 hereof) be paid to the Company on a Company Request or, if then held by the
Company, shall be discharged from such trust.
SECTION 3.07 Notes Redeemed in Part. Any Note which is to
be redeemed only in part shall be surrendered at an office or agency of the
Company designated for that purpose pursuant to Section 4.05 hereof (with, if
the Company or the Trustee so requires,
25
due endorsement by, or a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed by, the Holder thereof or the Holder's
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 of any authorized denomination as requested
by such Holder in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal of the Note so surrendered.
SECTION 3.08 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 called for redemption by an
agreement with one or more investment banks or other purchasers to purchase such
Notes by paying to the Trustee in trust for the Noteholders, at or prior to
10:00 a.m. New York City time on the Redemption Date, an amount that, together
with any amounts deposited with the Trustee by the Company for the redemption of
such Notes, is not less than the Redemption Price of such Notes. Notwithstanding
anything to the contrary contained in this Article 3, the obligation of the
Company to pay the Redemption Price of such Notes shall be deemed to be
satisfied and discharged to the extent such amount is so paid by such
purchasers. If such an agreement is entered into, 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 Article
10) surrendered by such purchasers for conversion, all as of immediately prior
to the close of business on the Redemption Date, subject to payment of the above
amount as aforesaid. The Trustee shall hold and pay to the Holders whose Notes
are selected for redemption any such amount paid to it for purchase and
conversion in the same manner as it would moneys 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 with respect to such
arrangement for the purchase and conversion of any Notes.
SECTION 3.09 Repurchase of Notes at Option of the Holder
upon Change of Control. (a) If there shall have occurred a Change of Control,
all or any portion of the Notes of any Holder equal to $1,000 or an integral
multiple of $1,000, not previously called for redemption, shall be repurchased
by the Company, at the option of such Holder, at a repurchase price equal to
100% of the principal amount of the Notes to be repurchased, together with
interest accrued and unpaid to, but excluding, the repurchase date (the "Change
of Control Repurchase Price"), on the date (the "Change of Control Repurchase
Date") that is 30 days after the Change of Control Repurchase Notice; provided,
however, that installments of interest on Notes whose Stated Maturity is prior
to or on the Change of Control Repurchase Date shall be payable to the Holders
of such Notes, or one or more predecessor Notes, registered as such on the
relevant Regular Record Date according to their terms. Such right to require the
repurchase of the Notes shall not continue after a discharge of the Company from
its obligations with respect
26
to the Notes in accordance with Article 8, unless a Change of Control shall have
occurred prior to such discharge.
Whenever in this Indenture (including without limitation
Sections 2.01, 6.01(a) and 6.07 hereof) or Exhibits A-1 and A-2 annexed hereto
there is a reference, in any context, to the principal of any Note as of any
time, such reference shall be deemed to include reference to the Change of
Control Repurchase Price payable in respect to such Note to the extent that such
Change of Control Repurchase Price is, was or would be so payable at such time,
and express mention of the Change of Control Repurchase Price in any provision
of this Indenture shall not be construed as excluding the Change of Control
Repurchase Price in those provisions of this Indenture when such express mention
is not made.
A "Change of Control" of the Company shall be deemed to have
occurred at such time as any of the following events shall occur:
(i) the acquisition by any person, including any
syndicate or group deemed to be a "person" under Section 13(d)(3) of
the Exchange Act, of beneficial ownership, directly or indirectly
(determined in accordance with Rule 13d-3 under the Exchange Act),
through a purchase, merger or other acquisition transaction or series
of transactions of shares of the Capital Stock of the Company entitling
that person to exercise 50% or more of the total voting power of all
shares of Capital Stock entitled to vote generally in elections of
directors, other than any acquisition by the Company, any of its
Subsidiaries or any of its employee benefit plans;
(ii) any consolidation or merger of the Company with or
into any other person, any merger of another person into the Company,
or any conveyance, transfer, sale, lease or other disposition of all or
substantially all of the Company's properties and assets to another
person, other than:
(1) any transaction (A) that does not result in any
reclassification, conversion, exchange or cancellation of
outstanding shares of the Company's Capital Stock and (B)
pursuant to which holders of the Company's Capital Stock
immediately prior to the transaction are entitled to exercise,
directly or indirectly, 50% or more of the total voting power
of all shares of the Company's Capital Stock entitled to vote
generally in the election of directors of the continuing or
surviving person immediately after the transaction; or
(2) any merger solely for the purpose of changing the
Company's jurisdiction of incorporation and resulting in a
reclassification, conversion or exchange of outstanding shares
of Common Stock solely into shares of Common Stock of the
surviving entity;
(iii) during any consecutive two-year period, individuals
who at the beginning of that two-year period constituted the Company's
board of directors (together with any new directors whose election to
such board of directors, or whose nomination for election by the
Company's stockholders, was approved by a vote of a majority of the
directors then still in office who were either directors at the
beginning of such period or whose
27
election or nomination for election was previously so approved) cease
for any reason to constitute a majority of the Company's board of
directors then in office; or
(iv) the Company is liquidated or dissolved or the
Company's stockholders pass a special resolution approving a plan of
liquidation or dissolution and no additional approvals of the Company's
stockholders are required under applicable law to cause a liquidation
or dissolution.
(b) Unless the Company shall have theretofore called for
redemption all of the outstanding Notes, prior to or on the 30th day after the
occurrence of a Change of Control, the Company, or, at the written request and
expense of the Company, the Trustee, shall give to all Noteholders, in the
manner provided in Section 13.02 hereof, notice of the occurrence of the Change
of Control and of the repurchase right set forth herein arising as a result
thereof. If the Trustee is requested to give such notice the Company will
provide the written request at least one Business Day prior. The Company shall
also deliver a copy of such notice of a repurchase right to the Trustee. The
notice shall include a form of Change of Control Repurchase Notice (as defined
in Section 3.9(c)) to be completed by the Noteholder and shall state:
(1) briefly, the events causing a Change of Control and
the date of such Change of Control;
(2) the date by which the Change of Control Repurchase
Notice pursuant to this Section 3.09 must be given;
(3) the Change of Control Repurchase Date;
(4) the Change of Control Repurchase Price;
(5) the name and address of the Paying Agent and the
Conversion Agent;
(6) the Conversion Rate and any adjustments thereto;
(7) that Notes as to which a Change of Control Repurchase
Notice has been given may be converted pursuant to Article 10 hereof
only if the Change of Control Repurchase Notice has been withdrawn in
accordance with the terms of this Indenture;
(8) that Notes must be surrendered to the Paying Agent to
collect payment of the Change of Control Repurchase Price;
(9) that the Change of Control Repurchase Price for any
Note as to which a Change of Control Repurchase Notice has been duly
given and not withdrawn will be paid promptly following the later of
the Change of Control Repurchase Date and the time of surrender of such
Note as described in (8) above;
(10) briefly, the procedures the Holder must follow to
exercise rights under this Section 3.09;
(11) briefly, the conversion rights of the Notes;
28
(12) the procedures for withdrawing a Change of Control
Repurchase Notice;
(13) that, unless the Company defaults in making payment
of such Change in Control Repurchase Price, interest on Notes
surrendered for repurchase will cease to accrue on and after the Change
of Control Repurchase Date; and
(14) the CUSIP number of the Notes.
(c) A Holder may exercise its rights specified in Section
3.09(a) hereof upon delivery of a written notice of purchase (a "Change of
Control Repurchase Notice") to the Paying Agent at any time prior to the close
of business on the Change of Control Repurchase Date, stating:
(1) the certificate number of the Note which the Holder
will deliver to be purchased (unless such Note is held in book-entry
form);
(2) the portion of the principal amount of the Note which
the Holder will deliver to be purchased, which portion must be $1,000
or an integral multiple thereof; and
(3) that such Note shall be purchased pursuant to the
terms and conditions specified in paragraph 7 of the Notes.
The delivery of such Note to the Paying Agent prior to, on or
after the Change of Control Repurchase Date (together with all necessary
endorsements) at the offices of the Paying Agent shall be a condition to the
receipt by the Holder of the Change of Control Repurchase Price therefor;
provided, however, that such Change of Control Repurchase Price shall be so paid
pursuant to this Section 3.09 only if the Note so delivered to the Paying Agent
shall conform in all respects to the description thereof set forth in the
related Change of Control Repurchase Notice.
The Company shall purchase from the Holder thereof, pursuant
to this Section 3.09, a portion of a Note if the principal amount of such
portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Note also apply to the purchase
of such portion of such Note.
Any purchase by the Company contemplated pursuant to the
provisions of this Section 3.09 shall be consummated by the delivery of the
consideration to be received by the Holder promptly following the later of the
Change of Control Repurchase Date and the time of delivery of the Note to the
Paying Agent in accordance with this Section 3.09.
Notwithstanding anything herein to the contrary, any Holder
delivering to the Paying Agent the Change of Control Repurchase Notice
contemplated by this Section 3.09(c) shall have the right to withdraw such
Change of Control Repurchase Notice at any time prior to the close of business
on the Change of Control Repurchase Date by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the
receipt by it of any Change of Control Repurchase Notice or written withdrawal
thereof.
29
SECTION 3.10 Effect of Change of Control Repurchase
Notice. Upon receipt by the Paying Agent of the Change of Control Repurchase
Notice specified in Section 3.09(c), the Holder of the Note in respect of which
such Change of Control Repurchase Notice was given shall (unless such Change of
Control Repurchase Notice is withdrawn as specified in the following two
paragraphs) thereafter be entitled to receive solely the Change of Control
Repurchase Price with respect to such Note. Such Change of Control Repurchase
Price shall be paid to such Holder, subject to receipts of funds and/or Notes by
the Paying Agent, promptly following the later of (x) the Change of Control
Repurchase Date with respect to such Note (provided the conditions in Section
3.09(c) have been satisfied) and (y) the time of delivery of such Note to the
Paying Agent by the Holder thereof in the manner required by Section 3.09(c).
Notes in respect of which a Change of Control Repurchase Notice, has been given
by the Holder thereof may not be converted pursuant to Article 10 hereof on or
after the date of the delivery of such Change of Control Repurchase Notice
unless such Change of Control Repurchase Notice has first been validly withdrawn
as specified in the following two paragraphs.
A Change of Control Repurchase Notice may be withdrawn by
means of a written notice of withdrawal delivered to the office of the Paying
Agent in accordance with the Change of Control Repurchase Notice at any time
prior to the close of business on the Change of Control Repurchase Date
specifying:
(1) the certificate number of the Note in respect of which
such notice of withdrawal is being submitted (or such other information
as is necessary to identify the holder, with respect to a book-entry
transfer),
(2) the principal amount of the Note with respect to which
such notice of withdrawal is being submitted, and
(3) the principal amount, if any, of such Note which remains
subject to the original Change of Control Repurchase Notice and which
has been or will be delivered for purchase by the Company.
There shall be no repurchase of any Notes pursuant to Section
3.09 if there has occurred (prior to, on or after, as the case may be, the
giving, by the Holders of such Notes, of the required Change of Control
Repurchase Notice) and is continuing an Event of Default (other than a default
in the payment of the Change of Control Repurchase Price with respect to such
Notes). The Paying Agent will promptly return to the respective Holders thereof
any Notes (x) with respect to which a Change of Control Repurchase Notice has
been withdrawn in compliance with this Indenture, or (y) held by it during the
continuance of an Event of Default (other than a default in the payment of the
Change of Control Repurchase Price with respect to such Notes) in which case,
upon such return, the Change of Control Repurchase Notice with respect thereto
shall be deemed to have been withdrawn.
SECTION 3.11 Deposit of Change of Control Repurchase
Price. Prior to 10:00 a.m. (New York City time) on the Business Day following
the Change of Control Repurchase Date, the Company shall deposit with the
Trustee or with the Paying Agent (or, if the Company or a Subsidiary or an
Affiliate of either of them is acting as the Paying Agent, shall segregate and
hold in trust as provided in Section 2.04) an amount of money (in immediately
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available funds if deposited on such Business Day) sufficient to pay the
aggregate Change of Control Repurchase Price of all the Notes or portions
thereof which are to be purchased as of the Change of Control Repurchase Date.
SECTION 3.12 Notes Purchased in Part. Any Note which is
to be purchased only in part shall be surrendered at the office of the Paying
Agent (with, if the Company or the Trustee so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or such Holder's attorney duly
authorized in writing) and the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of such Note, without service charge, a
new Note or Notes, of any authorized denomination as requested by such Holder in
aggregate principal amount equal to, and in exchange for, the portion of the
principal amount of the Note so surrendered which is not purchased.
SECTION 3.13 Covenant to Comply with Securities Laws upon
Purchase of Notes. In connection with any offer to purchase or repurchase Notes
under Section 3.09 hereof (provided that such offer or purchase constitutes an
"issuer tender offer" for purposes of Rule 13e-4 (which term, as used herein,
includes any successor provision thereto) under the Exchange Act at the time of
such offer or purchase), the Company shall (i) comply with Rule 13e-4, Rule
14e-1 and any other tender offer rules under the Exchange Act which may then be
applicable, (ii) file the related Schedule 13E-3 (or any successor schedule,
form or report) or any other schedule required under the Exchange Act, and (iii)
otherwise comply with all federal and state securities laws so as to permit the
rights and obligations under Section 3.09 to be exercised in the time and in the
manner specified in Section 3.09.
SECTION 3.14 Repayment to the Company. The Trustee and
the Paying Agent shall return to the Company any cash that remains unclaimed as
provided in paragraph 13 of the Notes, together with interest, if any, thereon,
held by them for the payment of the Change of Control Repurchase Price;
provided, however, that to the extent that the aggregate amount of cash
deposited by the Company pursuant to Section 3.11 exceeds the aggregate Change
of Control Repurchase Price of the Notes or portions thereof which the Company
is obligated to purchase as of the Change of Control Repurchase Date then
promptly after the Business Day following the Change of Control Repurchase Date
the Trustee shall return any such excess to the Company together with interest
or dividends, if any, thereon.
ARTICLE 4
COVENANTS
SECTION 4.01 Payment of Principal, Premium, Interest on
the Notes. The Company will duly and punctually pay the principal of and
premium, if any, and interest (including Additional Interest Amounts, if any) in
respect of the Notes in accordance with the terms of the Notes and this
Indenture. The Company will deposit or cause to be deposited with the Trustee,
no later than the day of the Stated Maturity of any Note or installment of
interest, all payments so due. Principal amount, Redemption Price, Change of
Control Repurchase Price, and cash interest shall be considered paid on the
applicable date due if on such date (or, in the case of a Change of Control
Repurchase Price on the Business Day following the applicable
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Change of Control Repurchase Date) the Trustee or the Paying Agent holds, in
accordance with this Indenture, money or Notes, if permitted hereunder,
sufficient to pay all such amounts then due.
The Company shall, to the extent permitted by law, pay cash
interest on overdue amounts at the rate per annum set forth in paragraph 1 of
the Notes, which interest shall accrue from the date such overdue amount was
originally due to the date payment of such amount, including interest thereon,
has been made or duly provided for. All such interest shall be payable on
demand.
SECTION 4.02 SEC and Other Reports. The Company shall
file with the Trustee, within 15 days after it files such annual and quarterly
reports, information, documents and other reports with the SEC, copies of its
annual report and of the information, documents and other reports (or copies of
such portions of any of the foregoing as the SEC may by rules and regulations
prescribe) which the Company is required to file with the SEC pursuant to
Section 13 or 15(d) of the Exchange Act. Such reports shall be provided at the
times the Company would have been required to provide reports had it continued
to have been subject to such reporting requirements. The Company also shall
comply with the other provisions of TIA Section 314(a). 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 with any of its covenants hereunder (as to
which the Trustee is entitled to rely exclusively on an Officers' Certificate).
SECTION 4.03 Compliance Certificate. The Company shall
deliver to the Trustee within 120 days after the end of each fiscal year of the
Company (beginning with the fiscal year ending on December 31, 2003) an
Officer's Certificate, stating whether or not to the best knowledge of the
signer thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions of this Indenture (without regard to
any period of grace or requirement of notice provided hereunder) and if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
SECTION 4.04 Further Instruments and Acts. Upon request
of the Trustee, the Company will execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purposes of this Indenture.
SECTION 4.05 Maintenance of Office or Agency. The Company
will maintain in the Borough of Manhattan, the City of New York, an office or
agency of the Trustee, Registrar, Paying Agent and Conversion Agent where Notes
may be presented or surrendered for payment, where Notes may be surrendered for
registration of transfer, exchange, purchase, redemption or conversion and where
notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served. The principal corporate trust office of The Bank of New
York, located at 101 Barclay Street, 8W, New York, NY 10286, attention:
Corporate Trust Division, shall initially be such office or agency for all of
the aforesaid purposes. The Company shall give prompt written notice to the
Trustee of the location, and of any change in the location, of any such office
or agency (other than a change in the location of the office of the Trustee). If
32
at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
address of the Trustee set forth in Section 13.02.
The Company may also from time to time designate one or more
other offices or agencies where the Notes may be presented or surrendered for
any or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York, for such purposes.
SECTION 4.06 Delivery of Certain Information. At any time
when the Company is not subject to Section 13 or 15(d) of the Exchange Act, upon
the request of a holder or any beneficial holder of Notes or shares of Common
Stock issued upon conversion thereof, the Company will promptly furnish or cause
to be furnished Rule 144A Information (as defined below) to such Holder or any
beneficial holder of Notes or holder of shares of Common Stock issued upon
conversion of Notes, or to a prospective purchaser of any such security
designated by any such holder, as the case may be, to the extent required to
permit compliance by such Holder or holder with Rule 144A under the Securities
Act in connection with the resale of any such security. "Rule 144A Information"
shall be such information as is specified pursuant to Rule 144A(d)(4) under the
Securities Act.
SECTION 4.07 Additional Interest Notice. In the event the
Company is required to pay amounts pursuant to the terms hereof, the Company
shall provide a notice (an "Additional Interest Payment Notice") to the Trustee
of its obligation to pay an Additional Interest Amount no later than fifteen
days prior to the payment date for the Additional Interest Amount, and the
Additional Interest Payment Notice shall set forth the dividend per share of
Common Stock payable by the Company on the Common Stock on the related record
date, the related dividend payment date, the aggregate amount of Additional
Interest Amounts to be paid and the amount of Additional Interest Amount to be
paid for each $1,000 principal amount of Notes by the Company on such payment
date. The Trustee shall not at any time be under a duty or owe a responsibility
to any holder of the Notes to determine the amount of the Additional Interest
Amount, or with respect to the nature, extent or calculation of the amount of
Additional Interest Amounts when made, or with respect to the method employed in
such calculation of the Additional Interest Amounts.
ARTICLE 5
MERGERS AND SALES OF ASSETS
SECTION 5.01 When Company May Merge or Transfer Assets.
The Company shall not consolidate with, merge with or into any other person or
convey, transfer or lease its properties and assets substantially as an entirety
to any person, unless:
(a) either (1) the Company shall be the continuing corporation
or (2) the person (if other than the Company) formed by such consolidation or
into which the Company is merged or the person which acquires by conveyance,
transfer or lease the properties and assets of the Company substantially as an
entirety (i) shall be organized and validly existing under the laws of
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the United States or any State thereof or the District of Columbia and (ii)
shall expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, all of the obligations of the Company under the Notes
and this Indenture;
(b) at the time of such transaction, no Event of Default and
no event which, after notice or lapse of time, would become an Event of Default,
shall have happened and be continuing; and
(c) the Company shall have delivered to the Trustee an
Officers' 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, comply with this Article 5 and that all conditions precedent herein
provided for relating to such transaction have been satisfied.
For purposes of the foregoing, the transfer (by assignment,
sale or otherwise) of the properties and assets of one or more Subsidiaries
(other than to the Company or another Subsidiary), which, if such assets were
owned by the Company, would constitute all or substantially all of the
properties and assets of the Company, shall be deemed to be the transfer of all
or substantially all of the properties and assets of the Company.
The successor person formed by such consolidation or into
which the Company is merged or the successor person to which such conveyance or
transfer is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Indenture with the same effect
as if such successor had been named as the Company herein; and thereafter,
except in the case of obligations the Company may have under a supplemental
indenture pursuant to Section 10.11, the Company shall be discharged from all
obligations and covenants under this Indenture and the Notes. Subject to Section
9.06, the Company, the Trustee and the successor person shall enter into a
supplemental indenture to evidence the succession and substitution of such
successor person and such discharge and release of the Company.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default. An "Event of Default"
occurs if:
(1) the Company fails to pay when due the principal of or
premium, if any, on any of the Notes at maturity, upon redemption or
exercise of a repurchase right or otherwise;
(2) the Company fails to pay an installment of interest
(including Liquidated Damages Amounts and Additional Interest Amounts,
if any) on any of the Notes that continues for 30 days after the date
when due, provided that a failure to make or provide for the payment of
any of the first five scheduled interest payments on the Notes within
three Business Days after an Interest Payment Date will constitute an
Event of Default with no additional grace or cure period;
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(3) the Company fails to (A) deliver shares of Common
Stock, together with cash in lieu of fractional shares, when such
Common Stock or cash in lieu of fractional shares is required to be
delivered upon conversion of a Note, or (B) make payment of the Cash
Payment Component when such cash is required to be delivered upon
conversion of a Note, and, in each case, that failure continues for 10
days after the relevant delivery date;
(4) the Company fails to perform or observe any other
term, covenant or agreement contained in the Notes or this Indenture
for a period of 60 days after receipt by the Company of a Notice of
Default (as defined in this Section 6.01);
(5) (A) the Company or any Significant Subsidiary fails
to pay at maturity (after giving effect to any applicable grace period)
any Indebtedness in an aggregate principal amount in excess of $10
million or (B) any of the Company's Indebtedness, or Indebtedness of
any Significant Subsidiary, aggregating $10 million or more shall have
been accelerated and declared due and payable prior to the scheduled
maturity thereof, and such acceleration is not rescinded or annulled
within a 30-day period after the date of such acceleration;
(6) the Company or any Significant Subsidiary pursuant to
or under or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding;
(B) consents to the entry of an order for relief
against it in an involuntary case or proceeding or the
commencement of any case against it;
(C) consents to the appointment of a Custodian
of it or for any substantial part of its property;
(D) makes a general assignment for the benefit
of its creditors;
(E) files a petition in bankruptcy or answer or
consent seeking reorganization or relief; or
(F) consents to the filing of such a petition or
the appointment of or taking possession by a Custodian; and
(7) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Significant Subsidiary in an involuntary case or proceeding,
or adjudicates the Company or any Significant Subsidiary
insolvent or bankrupt;
(B) appoints a Custodian of the Company or any
Significant Subsidiary or for any substantial part of its or
their properties; or
35
(C) orders the winding up or liquidation of the
Company or any Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 days.
"Bankruptcy Law" means Title 11, United States Code,
or any similar federal or state law for the relief of debtors.
"Custodian" means any receiver, trustee, assignee,
liquidator, custodian or similar official under any Bankruptcy
Law.
(8) the Pledge Agreement shall cease to be in full force
and effect or enforceable in accordance with its terms, prior to the
termination thereof in accordance with Section 18 of the Pledge
Agreement.
A Default under clause (4) above is not an Event of Default
until the Trustee notifies the Company, or the Holders of at least 25% in
aggregate principal amount of the Notes at the time outstanding notify the
Company and the Trustee, of the Default and the Company does not cure such
Default (and such Default is not waived) within the time specified in clause (4)
above after actual receipt of such notice. Any such notice must specify the
Default, demand that it be remedied and state that such notice is a "Notice of
Default".
The Company will deliver to the Trustee, within five Business
Days of becoming aware of the occurrence of an Event of Default, written notice
thereof. In addition, the Company shall deliver to the Trustee, within 30 days
after it becomes aware of the occurrence thereof, written notice of any event
which with the lapse of time would become an Event of Default under clause (4)
above, its status and what action the Company is taking or proposes to take with
respect thereto.
SECTION 6.02 Acceleration. If an Event of Default (other
than an Event of Default specified in Section 6.01(6) or (7)) occurs and is
continuing, the Trustee by Notice to the Company, or the Holders of at least 25%
in aggregate principal amount of the Notes at the time outstanding by notice to
the Company and the Trustee, may declare the notes due and payable at their
principal amount together with accrued and unpaid interest. Upon a declaration
of acceleration, such principal and accrued and unpaid interest to the date of
payment shall be immediately due and payable.
If an Event of Default specified in Section 6.01(6) or (7)
above occurs and is continuing, then the principal and the interest on all the
Notes shall become and be immediately due and payable without any declaration or
other act on the part of the Trustee or any Noteholders.
The Holders of a majority in aggregate principal amount of the
Notes at the time outstanding, by notice to the Trustee (and without notice to
any other Noteholder) may rescind or annul an acceleration and its consequences
if the rescission would not conflict with any judgment or decree and if all
existing Events of Default have been cured or waived except nonpayment of the
principal and any accrued cash interest that have become due solely as a result
of acceleration
36
and if all amounts due to the Trustee under Section 7.06 have been paid. No such
rescission shall affect any subsequent Default or impair any right consequent
thereto.
SECTION 6.03 Other Remedies. If an Event of Default
occurs and is continuing, the Trustee may pursue any available remedy to collect
the payment of the principal, the premium, if any, and any accrued cash interest
on the Notes or to enforce the performance of any provision of the Notes or this
Indenture.
The Trustee may maintain a proceeding even if the Trustee does
not possess any of the Notes or produce any of the Notes in the proceeding. A
delay or omission by the Trustee or any Noteholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of, or acquiescence in, the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04 Waiver of Past Defaults. The Holders of a
majority in aggregate principal amount of the Notes at the time outstanding, by
notice to the Trustee (and without notice to any other Noteholder), may waive an
existing Default and its consequences except (a) an Event of Default described
in Section 6.01(1) or (2), (b) a Default in respect of a provision that under
Section 9.02 cannot be amended without the consent of each Noteholder affected
or (c) a Default which consists of a failure to convert any Note in accordance
with the terms of Article 10. When a Default is waived, it is deemed cured, but
no such waiver shall extend to any subsequent or other Default or impair any
consequent right. This Section 6.04 shall be in lieu of Section 316(a)1(B) of
the TIA and such Section 316(a)1(B) is hereby expressly excluded from this
Indenture, as permitted by the TIA.
SECTION 6.05 Control by Majority. The Holders of a
majority in aggregate principal amount of the Notes at the time outstanding may
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or of exercising any trust or power conferred on the
Trustee. However, the Trustee may refuse to follow any direction that conflicts
with law or this Indenture or that the Trustee determines in good faith is
unduly prejudicial to the rights of other Noteholders or would involve the
Trustee in personal liability unless the Trustee is offered indemnity
satisfactory to it against loss, liability or expense. This Section 6.05 shall
be in lieu of Section 316(a)1(A) of the TIA and such Section 316(a)1(A) is
hereby expressly excluded from this Indenture, as permitted by the TIA.
SECTION 6.06 Limitation on Suits. A Noteholder may not
pursue any remedy with respect to this Indenture or the Notes unless:
(1) the Holder gives to the Trustee written notice
stating that an Event of Default is continuing;
(2) the Holders of at least 25% in aggregate principal
amount of the Notes at the time outstanding make a written request to
the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee
reasonable indemnity satisfactory to the Trustee against any loss,
liability or expense;
37
(4) the Trustee does not comply with the request within
60 days after receipt of such notice, request and offer of indemnity;
and
(5) the Holders of a majority in aggregate principal
amount of the Notes at the time outstanding do not give the Trustee a
direction inconsistent with the request during such 60-day period.
A Noteholder may not use this Indenture to prejudice the
rights of any other Noteholder or to obtain a preference or priority over any
other Noteholder.
SECTION 6.07 Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder
to receive payment of the principal amount, premium, if any, plus Redemption
Price, Change of Control Repurchase Price or any accrued cash interest
(including Additional Interest Amounts, if any) in respect of the Notes held by
such Holder, on or after the respective due dates expressed in the Notes or any
Redemption Date, and to convert the Notes in accordance with Article 10, or to
bring suit for the enforcement of any such payment on or after such respective
dates or the right to convert, shall not be impaired or affected adversely
without the consent of such Holder.
SECTION 6.08 Collection Suit by Trustee. If an Event of
Default described in Section 6.01(1) or (2) occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against the Company for the whole amount owing with respect to the Notes and the
amounts provided for in Section 7.06.
SECTION 6.09 Trustee May File Proofs of Claim. In case of
the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon the Notes or the
property of the Company or of such other obligor or their creditors, the Trustee
(irrespective of whether the principal amount, Redemption Price, Change of
Control Repurchase Price or any accrued cash interest in respect of the Notes
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company for the payment of any such amount) shall be entitled and empowered,
by intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of the
principal amount, Redemption Price, Change of Control Repurchase Price
or any accrued cash interest (including, without limitation, Additional
Interest Amounts) and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel or
any other amounts due the Trustee under Section 7.06) and of the
Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or similar official in any such judicial proceeding is
hereby authorized by each Holder to make such payments to the Trustee
and, in the event that the Trustee shall consent to the making of such
38
payments directly to the Holders, to pay the Trustee any amount due it
for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.06.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Notes or the rights of any Holder thereof, or to authorize the Trustee to vote
in respect of the claim of any Holder in any such proceeding.
SECTION 6.10 Priorities. If the Trustee collects any
money pursuant to this Article 6, it shall pay out the money in the following
order:
(1) to the Trustee for amounts due under Section 7.06;
(2) to Noteholders for amounts due and unpaid on the
Notes for the principal amount, Redemption Price, Change of Control
Purchase Price or any accrued cash interest (including Additional
Interest Amounts, if any) as the case may be, ratably, without
preference or priority of any kind, according to such amounts due and
payable on the Notes; and
(3) the balance, if any, to the Company.
The Trustee may fix a record date and payment date for any
payment to Noteholders pursuant to this Section 6.10. At least 15 days before
such record date, the Trustee shall mail to each Noteholder and the Company a
notice that states the record date, the payment date and the amount to be paid.
SECTION 6.11 Undertaking for Costs. In any suit for the
enforcement of any right or remedy under this Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant (other than the Trustee)
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in the suit, having due regard to the
merits and good faith of the claims or defenses made by the party litigant. This
Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.07 or a suit by Holders of more than 10% in aggregate
principal amount of the Notes at the time outstanding. This Section 6.11 shall
be in lieu of Section 315(e) of the TIA and such Section 315(e) is hereby
expressly excluded from this Indenture, as permitted by the TIA.
SECTION 6.12 Waiver of Stay, Extension or Usury Laws. The
Company covenants (to the extent that it may lawfully do so) that it will not at
any time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury or other law
wherever enacted, now or at any time hereafter in force, which would prohibit or
forgive the Company from paying all or any portion of the principal amount,
Redemption Price, Change of Control Repurchase Price or any accrued cash
interest (including Additional Interest Amounts, if any) in respect of Notes, or
any interest on such amounts, as contemplated herein, or which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives
39
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.
ARTICLE 7
TRUSTEE
SECTION 7.01 Duties and Responsibilities of the Trustee;
During Default; Prior to Default. (a) The Trustee, prior to the occurrence of an
Event of Default hereunder and after the curing or waiving of all such Events of
Default which may have occurred,
(1) undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture; but in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished
to the Trustee, shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this Indenture.
In case an Event of Default hereunder 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 man would exercise or use under the
circumstances in the conduct of his 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
(b) prior to the occurrence of an Event of Default
hereunder and after the curing or waiving of all such Events of Default
which may have occurred:
(i) the duties and obligations of the Trustee
shall be determined solely by 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 against the
Trustee; and
(ii) in the absence of bad faith 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 statements, certificates or
opinions furnished to the Trustee and conforming to the
requirements of this Indenture; but in the case of any such
statements, certificates or opinions which by any provision
40
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;
(c) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(d) the Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance
with the direction of the Holders pursuant to Section 6.05 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.
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.
The provisions of this Section 7.01 are in furtherance of and
subject to Sections 315 and 316 of the TIA. Whether or not therein expressly so
provided, every provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Trustee shall be subject to the
provisions of this Section 7.01.
SECTION 7.02 Certain Rights of the Trustee. In
furtherance of and subject to the TIA and subject to Section 7.01:
(a) the Trustee may rely and shall be protected in acting
or refraining from acting upon any resolution, Officers' Certificate or
any other certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, coupon, Note
or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(b) any request, direction, order or demand of the
Company mentioned herein shall be sufficiently evidenced by an
Officers' 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 any Opinion of Counsel shall be full
and complete authorization and protection in respect of any action
taken, suffered or omitted to be taken by it hereunder in good faith
and in reliance thereon;
(d) the Trustee shall be under no obligation to exercise
any of the trusts 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 satisfactory to the
Trustee against the
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costs, expenses and liabilities which might be incurred by it in
compliance with such request, order or direction;
(e) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion, rights or powers conferred upon it
by this Indenture;
(f) the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Trustee shall determine
to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or
by agent or attorney at the sole cost of the Company and shall incur no
liability or additional liability of any kind by reason of such inquiry
or investigation; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any such agent or
attorney appointed with due care by it hereunder;
(h) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence by herein specifically prescribed) may,
in the absence of bad faith on its part, conclusively rely upon an
Officers' Certificate;
(i) the Trustee shall not be deemed to have or be charged
with knowledge of any Default or Event of Default unless a Responsible
Officer of the Trustee has received at the Corporate Trust Office of
the Trustee written notice of such Default or Event of Default, as the
case may be, from the Company or any Holder of the Notes, and such
notice references the Notes and this Indenture;
(j) 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;
(k) the Trustee may request that the Company deliver an
Officers' Certificate setting forth the names of individuals and/or
titles of officers authorized at such time to take specified actions
pursuant to this Indenture, which Officers' Certificate may be signed
by any person authorized to sign an Officers' Certificate, including
any person specified as so authorized in any such certificate
previously delivered and not superseded;
(l) the permissive right of the Trustee to take action
under this Indenture shall not be construed as a duty.
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SECTION 7.03 Trustee Not Responsible for Recitals,
Disposition of Notes or Application of Proceeds Thereof. The recitals contained
herein and in the Notes, except the Trustee's certificates 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
representation 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 of the Notes or of the proceeds thereof.
SECTION 7.04 Trustee and Agents May Hold Notes;
Collections, etc. The Trustee or any agent of the Company or the Trustee, 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 the Trustee or such agent and,
subject to Sections 7.07 and 7.12, if operative, may otherwise deal with the
Company and receive, collect, hold and retain collections from the Company with
the same rights it would have if it were not the Trustee or such agent.
SECTION 7.05 Moneys Held by Trustee. All moneys received
by the Trustee shall, until used or applied as herein provided, be held in trust
for the purposes for which they were received, but need not be segregated from
other funds except to the extent required by mandatory provisions of law.
Neither the Trustee nor any agent of the Company or the Trustee shall be under
any liability for interest on any moneys received by it hereunder except as may
otherwise be agreed in writing with the Company.
SECTION 7.06 Compensation and Indemnification of Trustee
and Its Prior Claim. The Company covenants and agrees to pay to the Trustee from
time to time, and the Trustee shall be entitled to, such compensation (which
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) to be agreed to in writing by the Trustee and the
Company, and the Company covenants and agrees to pay or reimburse the Trustee
and each predecessor Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by or on behalf of it in accordance
with any of the provisions of this Indenture (including (i) the reasonable
compensation and the expenses and disbursements of its counsel and of all agents
and other persons not regularly in its employ and (ii) interest at the prime
rate on any disbursements and advances made by the Trustee and not paid by the
Company within 5 days after receipt of an invoice for such disbursement or
advance) except any such expense, disbursement or advance as may arise from its
negligence or willful misconduct. The Company also covenants to indemnify the
Trustee and each predecessor Trustee for, and to hold them harmless against, any
loss, liability or expense incurred without negligence or willful misconduct on
its part, arising out of or in connection with the acceptance or administration
of this Indenture or the trusts hereunder and its duties hereunder, including
the costs and expenses of defending itself against or investigating any claim of
liability in connection with the exercise or performance of any of its powers or
duties hereunder. The obligations of the Company under this Section 7.06 to
compensate and indemnify the Trustee and each predecessor Trustee and to pay or
reimburse the Trustee and each predecessor Trustee for expenses, disbursements
and advances shall constitute additional indebtedness hereunder and shall
survive the satisfaction and discharge of this Indenture, the resignation or
removal of the Trustee and the termination of the Indenture. Such additional
indebtedness shall be a senior claim to that of the Notes upon all property and
funds held or collected by the Trustee as such, except funds held in trust for
the benefit of the Holders of particular Notes, and the Notes are hereby
effectively subordinated to
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such senior claim to such extent. The provisions of this Section 7.06 shall
survive the satisfaction and discharge of this Indenture, the resignation or
removal of the Trustee and the termination, for any reason, of this Indenture.
When the Trustee incurs expenses or renders services in connection with an Event
of Default specified in Section 6.01 or in connection with Article 6 hereof, the
expenses (including the reasonable fees and expenses of its counsel) and the
compensation for services in connection therewith are to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.07 Conflicting Interests. If the Trustee has or
shall acquire a conflicting interest within the meaning of the TIA, 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 TIA. For purposes of Section
310(b)(1) of the Trust Indenture Act and to the extent permitted thereby, the
Trustee shall not be deemed to have a conflicting interest arising from its
capacity as trustee in respect of any series of securities issued under the
Indenture, dated as May 1, 2000, by and between the Company and The Bank of New
York, as trustee, or any securities issued under or in connection with the
Purchase Contract Agreement dated as of November 16, 2001, between the Company
and The Bank of New York, as purchase contract agent.
SECTION 7.08 Persons Eligible for Appointment as Trustee.
The Trustee shall at all times be a corporation or banking association having a
combined capital and surplus of at least $50,000,000. If such corporation or
banking association publishes reports of condition at least annually, pursuant
to law or to the requirements of the aforesaid supervising or examining
authority, then, for the purposes of this Section 7.08, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 7.08, the Trustee shall resign immediately in the
manner and with the effect specified in Section 7.09.
SECTION 7.09 Resignation and Removal; Appointment of
Successor Trustee. (a) The Trustee, or any trustee or trustees hereafter
appointed, may at any time resign with respect to one or more or all series of
Notes by giving written notice of resignation to the Company and by mailing
notice thereof by first class mail to the Holders of Notes at their last
addresses as they shall appear on the Note register. Upon receiving such notice
of resignation, the Company shall promptly appoint a successor trustee or
trustees by written instrument in duplicate, executed by authority of the Board
of Directors, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee or trustees. If no successor
trustee shall have been so appointed and have accepted appointment within 30
days after the mailing of such notice of resignation, the resigning trustee may
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 for at
least six months may, subject to the provisions of Section 7.10, on behalf of
himself and all others similarly situated, petition any such court for the
appointment of a successor trustee. Such court 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:
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(i) the Trustee shall fail to comply with the provisions
of Section 7.07 with respect to any Notes after written request
therefor by the Company or by any Noteholder who has been a bona fide
Holder of a Note for at least six months; or
(ii) the Trustee shall cease to be eligible in accordance
with the provisions of Section 7.08 and shall fail to resign after
written request therefor by the Company or by any Noteholder; or
(iii) the Trustee shall become incapable of acting or shall
be adjudged a bankrupt or insolvent, or a receiver or liquidator 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 remove the Trustee and appoint
a successor trustee by written instrument, in duplicate, executed by
order of the Board of Directors of the Company, 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 7.10,
any Noteholder who has been a bona fide Holder of a Note 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. If no
successor trustee shall have been appointed and have accepted
appointment within 30 days after a notice of removal has been given,
the removed trustee may, at the cost and expense of the Company,
petition a court of competent jurisdiction for the appointment of 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 appoint a successor trustee by delivering to the Trustee so removed, to the
successor trustee so appointed and to the Company the evidence provided for in
Section 1.05 of the action in that regard taken by the Noteholders.
(d) Any resignation or removal of the Trustee and any
appointment of a successor trustee pursuant to any of the provisions of this
Section 7.09 shall become effective upon acceptance of appointment by the
successor trustee as provided in Section 7.10.
SECTION 7.10 Acceptance of Appointment by Successor
Trustee. Any successor trustee appointed as provided in Section 7.09 shall
execute 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
rights, powers, duties and obligations of its predecessor hereunder, with like
effect as if originally named as trustee hereunder; but, nevertheless, on the
written request of the Company or of the successor trustee, upon payment of its
charges then unpaid, the trustee ceasing to act shall pay over to the successor
trustee all moneys at the time held by it hereunder and shall execute and
deliver an instrument transferring to such
45
successor trustee all such rights, powers, duties and obligations. 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 prior claim pursuant to Section 7.06 upon all property or
funds held or collected by such trustee to secure any amounts then due it
pursuant to the provisions of Section 7.06.
No successor trustee shall accept appointment as provided in
this Section 7.10 unless at the time of such acceptance such successor trustee
shall be qualified under the provisions of Section 7.07 and eligible under the
provisions of Section 7.08.
Upon acceptance of appointment by any successor trustee as
provided in this Section 7.10, the Company shall mail notice thereof by first
class mail to the Holders of Notes at their last addresses as they shall appear
in the register. If the acceptance of appointment is substantially
contemporaneous with the resignation, then the notice called for by the
preceding sentence may be combined with the notice called for by Section 7.09.
If the Company fails to mail such notice within ten 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 7.11 Merger, Conversion, Consolidation or
Succession to Business of Trustee. Any corporation or banking association into
which the Trustee may be merged or converted or with which it may be
consolidated, or any corporation or banking association resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation or banking association succeeding to all or substantially all of
the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided that such corporation or banking association shall
be qualified under the provisions of Section 7.07 and eligible under the
provisions of Section 7.08, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding. 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 and deliver
such Notes so authenticated; and, in case at that time any of the Notes shall
not have been authenticated, any successor to the Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor Trustee; and in all such cases such certificate shall have the full
force and effect that this Indenture provides for the certificate of
authentication of the Trustee; provided, 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 7.12 Preferential Collection of Claims Against
the Company. The Trustee shall comply with the provisions of Section 311 of the
TIA.
SECTION 7.13 Reports by the Trustee. (a) The Trustee
shall transmit to Holders and other persons such reports concerning the Trustee
and its actions under this Indenture as may be required pursuant to the TIA on
or before July 15 in each year that such report is required, such reports to be
dated as of the immediately preceding May 15.
(b) A copy of each such report shall, at the time of such
transmission to Noteholders, be furnished to the Company and be filed by the
Trustee with each stock exchange
46
upon which the Notes are listed and also with the SEC. The Company agrees to
notify promptly the Trustee when and as the Notes become admitted to trading on
any national securities exchange and of any delisting thereof.
SECTION 7.14 Trustee to Give Notice of Default, But May
Withhold in Certain Circumstances. The Trustee shall transmit to the
Noteholders, as the names and addresses of such Holders appear on the Note
register, notice by mail of all Defaults known to the Trustee which have
occurred, such notice to be transmitted within 90 days after the occurrence
thereof, unless such defaults shall have been cured before the giving of such
notice; provided that, except in the case of Default in the payment of the
principal of, interest on, or other similar obligation with respect to, any of
the Notes, the Trustee shall be protected in withholding such notice if and so
long as the board of directors, the executive committee, or a trust committee of
directors or trustees and/or Responsible Officers of the Trustee in good faith
determines that the withholding of such notice is in the best interests of the
Noteholders.
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01 Termination of the Company's Obligations.
Except as otherwise provided in this Section 8.01 and in Section 8.05 hereof,
the Company may terminate its obligations under the Notes and this Indenture if:
(i) all Notes previously authenticated and delivered
(other than destroyed, lost or stolen Notes that have been replaced or
Notes that are paid pursuant to Section 2.07 hereof or Notes for whose
payment money or securities have theretofore been held in trust and
thereafter repaid to the Company, as provided in Section 8.03 hereof)
have been delivered to the Trustee for cancellation and the Company has
paid all sums payable by it hereunder; or
(ii) (A) all of the Notes mature within one year or all of
them are to be called for redemption within one year under arrangements
satisfactory to the Trustee for giving the notice of redemption, (B)
the Company deposits in trust with the Trustee during such one-year
period, under the terms of an irrevocable trust agreement in form and
substance satisfactory to the Trustee, as trust funds solely for the
benefit of the Holders for that purpose, money or U.S. Government
Obligations sufficient to pay principal, premium, if, any, and interest
on the Notes to maturity or redemption, as the case may be, and to pay
all other sums payable by it hereunder, (C) no Default or Event of
Default with respect to the Notes shall have occurred and be continuing
on the date of such deposit, (D) such deposit will not result in a
breach or violation of, or constitute a default under, this Indenture
or any other agreement or instrument to which the Company is a party or
by which it is bound and (E) the Company has delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, in each case
stating that all conditions precedent provided for herein relating to
the satisfaction and discharge of this Indenture have been complied
with.
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With respect to the foregoing clause (i), the Company's
obligations under Section 7.06 hereof shall survive. With respect to the
foregoing clause (ii), the Company's obligations in Sections 2.02, 2.03, 2.04,
2.05, 2.06, 2.07, 4.01, 4.05, 7.06, 7.09 and 8.03 and in Article 10 of this
Indenture shall survive until the Notes are no longer outstanding. Thereafter,
only the Company's obligations in Sections 7.06 and 8.03 of this Indenture shall
survive. After any such irrevocable deposit, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations, as the case
may be, under the Notes and this Indenture, except for those surviving
obligations specified above.
SECTION 8.02 Application of Trust Money. The Trustee or
Paying Agent shall hold in trust money or U.S. Government Obligations deposited
with it pursuant to Section 8.01 and shall apply the deposited money and the
money from U.S. Government Obligations in accordance with the Notes and this
Indenture to the payment of principal of, premium, if any, and interest on the
Notes; but such money need not be segregated from other funds except to the
extent required by law.
SECTION 8.03 Reinstatement. If the Trustee or the Paying
Agent is unable to apply any money or U.S. Government Obligations in accordance
with Section 8.01 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 8.01 until such time as the Trustee or Paying Agent
is permitted to apply all such money or U.S. Government Obligations in
accordance with Section 8.01; provided that, if the Company has made any payment
of principal of, premium, if any, or interest on any Notes because of 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 or U.S.
Government Obligations held by the Trustee or Paying Agent.
SECTION 8.04 Repayment of the Company. The Trustee and
the Paying Agent shall return to the Company upon written request any money or
securities held by them for the payment of any amount with respect to the Notes
that remains unclaimed for two years, subject to applicable unclaimed property
law. After return to the Company, Holders entitled to the money or securities
must look to the Company for payment as general creditors unless an applicable
abandoned property law designates another person and the Trustee and the Paying
Agent shall have no further liability to the Noteholders with respect to such
money or securities for that period commencing after the return thereof.
SECTION 8.05 Conversion of Notes Upon Discharge.
Notwithstanding any satisfaction or discharge of this Indenture pursuant to the
provisions of this Article 8, for so long as any of the Notes are outstanding,
the conversion right of Noteholders set forth in this Indenture shall not expire
until the close of business on February 14, 2010 and the Company shall remain
obligated to issue duly authorized, fully paid and nonassessable shares of
Common Stock upon conversion of the Notes in accordance with the terms of this
Indenture.
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ARTICLE 9
AMENDMENTS
SECTION 9.01 Without Consent of Holders. The Company and
the Trustee may amend this Indenture or the Notes without the consent of any
Noteholder for the purposes of, among other things:
(1) adding to the Company's covenants or obligations
under this Indenture for the benefit of the Holders;
(2) surrendering any right, power or option conferred
upon the Company by this Indenture;
(3) providing for conversion rights of Holders if any
reclassification or change of Common Stock or any consolidation, merger
or sale of all or substantially all of the Company's assets occurs;
(4) providing for the assumption of the Company's
obligations to the Holders in the case of a merger, consolidation,
conveyance, transfer or lease;
(5) increasing the Conversion Rate, provided that the
increase will not adversely affect the interests of Holders in any
material respect;
(6) complying with the requirements of the SEC in order
to effect or maintain the qualification of this Indenture under the
TIA;
(7) making any changes or modifications to this Indenture
necessary in connection with the registration of the Notes under the
Securities Act as contemplated by the registration rights agreement,
provided that this action does not adversely affect the interests of
the Holders in any material respect;
(8) curing any ambiguity or correcting or supplementing
any defective provision contained in this Indenture; provided that such
modification or amendment does not, in the good faith opinion of the
Board of Directors, adversely affect the interests of the Holders in
any material respect;
(9) adding or modifying any other provisions which the
Company may deem necessary or desirable and which will not adversely
affect the interests of the Holders in any material respect; or
(10) to evidence and provide for the acceptance of
appointment of a successor Trustee.
SECTION 9.02 With Consent of Holders. With the written
consent of the Holders of at least a majority in aggregate principal amount of
the Notes at the time outstanding, the Company and the Trustee may amend this
Indenture or the Notes. However, without the consent of each Noteholder
affected, an amendment to this Indenture or the Notes may not:
49
(1) change the maturity of the principal of or any
installment of interest on any Note (including any payment of
Liquidated Damages Amounts);
(2) reduce the principal amount of, or any premium or
interest on (including any payment of Liquidated Damages Amounts or
Additional Interest Amounts), any Note;
(3) change the currency of payment of such Note or
interest thereon;
(4) impair the right to institute suit for the
enforcement of any payment on or with respect to any Note;
(5) except as otherwise permitted or contemplated by
provisions concerning corporate reorganizations, adversely affect the
repurchase option of Holders upon a Change of Control or the conversion
rights of Holders;
(6) modify the provisions relating to the pledge of
securities in Article 12 hereof, in a manner that adversely affects the
interests of the Holders; or
(7) reduce the percentage in aggregate principal amount
of Notes outstanding necessary to modify or amend this Indenture or to
waive any past default.
It shall not be necessary for the consent of the Holders under
this Section 9.02 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section 9.02 becomes effective,
the Company shall mail to each Holder a notice briefly describing the amendment.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Persons entitled to consent to any
indenture supplemental hereto. If a record date is fixed, the Holders on such
record date, or their duly designated proxies, and only such Persons, shall be
entitled to consent to such supplemental indenture, whether or not such Holders
remain Holders after such record date; provided, that unless such consent shall
have become effective by virtue of the requisite percentage having been obtained
prior to the date which is 90 days after such record date, any such consent
previously given shall automatically and without further action by any Holder be
cancelled and of no further effect.
SECTION 9.03 Compliance with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall comply with the
TIA.
SECTION 9.04 Revocation and Effect of Consents, Waivers
and Actions. Until an amendment, waiver or other action by Holders becomes
effective, a consent thereto by a Holder of a Note hereunder is a continuing
consent by the Holder and every subsequent Holder of that Note or portion of the
Note that evidences the same obligation as the consenting Holder's Note, even if
notation of the consent, waiver or action is not made on the Note. However, any
such Holder or subsequent Holder may revoke the consent, waiver or action as to
such Holder's Note or portion of the Note if the Trustee receives the notice of
revocation before the date the
50
amendment, waiver or action becomes effective. After an amendment, waiver or
action becomes effective, it shall bind every Noteholder.
SECTION 9.05 Notation on or Exchange of Notes. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article may, and shall if required by the Trustee, bear a
notation in form approved by the Company as to any matter provided for in such
supplemental indenture. If the Company shall so determine, new Notes so modified
as to conform, in the opinion of the Board of Directors, to any such
supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for outstanding Notes.
SECTION 9.06 Trustee to Sign Supplemental Indentures. The
Trustee shall sign any supplemental indenture authorized pursuant to this
Article 9 if the amendment contained therein does not adversely affect the
rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign such supplemental indenture. In signing such
supplemental indenture the Trustee shall be entitled to receive, and (subject to
the provisions of Section 7.01) shall be fully protected in relying upon, an
Officers' Certificate and an Opinion of Counsel stating that such amendment is
authorized or permitted by this Indenture.
SECTION 9.07 Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article, this Indenture shall
be modified in accordance therewith, and such supplemental indenture shall form
a part of this Indenture for all purposes; and every Holder of Notes theretofore
or thereafter authenticated and delivered hereunder shall be bound thereby.
ARTICLE 10
CONVERSION
SECTION 10.01 Conversion Right and Conversion Rate. (a)
The Notes will not be convertible prior to August 14, 2003. At any time on or
after August 14, 2003, subject to and upon compliance with the provisions of
this Article, at the option of the Holder thereof, any Note or any portion of
the principal amount thereof which is $1,000 or an integral multiple of $1,000
may be converted at the principal amount thereof, or of such portion thereof,
into a combination of cash and duly authorized, fully paid and nonassessable
shares of Common Stock (or, in the event that the Shareholder Approval Condition
shall have been satisfied and the Company so elects, entirely into shares of
Common Stock) as provided in this Section 10.01. Such conversion right shall
expire at the close of business on February 14, 2010.
In case a Note or portion thereof is called for redemption,
such conversion right in respect of the Note or the portion so called shall
expire at the close of business on the Business Day immediately preceding the
Redemption Date, unless the Company defaults in making the payment due upon
redemption. A Note for which a Holder has delivered a Change of Control
Repurchase Notice requiring the Company to repurchase the Note may be
surrendered for conversion only if such notice is withdrawn in accordance with
Section 3.10 hereof.
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(b) Upon conversion of any Note or any portion of the
principal amount thereof prior to the time the Shareholder Approval Condition
has been satisfied, the Company shall deliver to the Holder for each $1,000
principal amount of such Note surrendered for conversion (1) a number of shares
of Common Stock equal to the Share Payment Component in effect at the time of
conversion and (2) an amount of cash (the "Cash Payment Component") equal to the
then conversion market value of a number of shares of Common Stock equal to the
difference between the Conversion Rate in effect at the time of conversion and
the Share Payment Component in effect at that time. The conversion market value
shall be determined based on the average Closing Price of the Common Stock for
the five consecutive Trading Days immediately following the second Business Day
after the date on which the Conversion Agent receives the related conversion
notice.
In the event that the Shareholder Approval Condition shall
have been satisfied, the Company may elect to deliver shares of Common Stock in
lieu of paying the Cash Payment Component upon any subsequent conversion of any
Note or any portion of the principal amount thereof. If the Company so elects,
it shall deliver to the Holder for each $1,000 principal amount of a Note
surrendered for conversion a number of shares of Common Stock equal to the
Conversion Rate in effect at the time of conversion. The Company shall notify a
Holder of its election to deliver Common Stock in lieu of cash within two
Business Days after the Conversion Agent receives such Holder's conversion
notice, unless the Company shall have given a notice of redemption pursuant to
Section 3.04 hereof.
The "Conversion Rate" shall initially be 219.1637 and shall be
adjusted in certain instances as provided in Section 10.04 hereof. The Share
Payment Component shall initially be 76.7073 and shall be subject to adjustment
in the same manner and under the same circumstances as the Conversion Rate,
subject to any limitation under applicable rules of the New York Stock Exchange.
The "Shareholder Approval Condition" shall be satisfied if and
when the issuance and delivery of shares of Common Stock upon conversion of the
aggregate principal amount of the Notes shall have been approved by a majority
of the outstanding shares of Common Stock entitled to vote on the matter. The
Company shall use its reasonable efforts to obtain such shareholder approval not
later than 180 days after the earliest date of original issuance of any of the
Notes. In the event that the Shareholder Approval Condition has been satisfied,
the Company shall promptly notify the Holders thereof and use its reasonable
efforts to post this information on its website or otherwise publicly disclose
this information.
SECTION 10.02 Exercise of Conversion Right. To exercise
the conversion right, a Holder must satisfy the requirements in paragraph 9 of
the Notes. The date on which the Holder satisfies all those requirements is the
conversion date (the "Conversion Date") with respect to such Holder's Notes. The
Conversion Agent shall notify the Company within one Business Day of receiving a
Holder's conversion notice. In the event that the Shareholder Approval Condition
shall have been satisfied, within two Business Days after the Conversion Agent
receives such Holder's conversion notice, the Company shall deliver to the
Holder, through the Conversion Agent, written notice of whether the Company
shall pay the Cash Payment Component or deliver shares of Common Stock in lieu
thereof, unless the Company shall have delivered a notice of redemption pursuant
to Section 3.04. Unless the Shareholder
52
Approval Condition shall have been satisfied and the Company has elected to
deliver Common Stock in lieu of the Cash Payment Component, the Company shall
deliver to the Holder through the Conversion Agent the amount of cash payable,
together with the number of full shares of Common Stock deliverable and cash in
lieu of any fractional share determined pursuant to Section 10.03 hereof, no
later than the tenth Business Day following the Conversion Date. If the
Shareholder Approval Condition shall have been satisfied and the Company shall
have notified the Holder that it shall deliver Common Stock in lieu of the Cash
Payment Component, the Company shall deliver to the Holder through the
Conversion Agent, as promptly as practicable but in any event no later than the
fifth Business Day following the Conversion Date, the number of full shares of
Common Stock deliverable upon the conversion and cash in lieu of any fractional
share determined pursuant to Section 10.03 hereof. The Company may not change
its election with respect to the consideration to be delivered upon conversion
of a Note (or any portion of the principal amount thereof) once the Company has
notified the Holder in accordance with this paragraph. The person in whose name
the shares of Common Stock delivered as consideration are registered shall be
treated as a stockholder of record on and after the Conversion Date; provided,
however, that no surrender of a Note (or any portion of the principal amount
thereof) on any date when the stock transfer books of the Company shall be
closed shall be effective to constitute the person or persons entitled to
receive the shares of Common Stock upon such conversion as the record holder or
holders of such shares of Common Stock on such date, but such surrender shall be
effective to constitute the person or persons entitled to receive such shares of
Common Stock as the record holder or holders thereof for all purposes at the
close of business on the next succeeding day on which such stock transfer books
are open; such conversion shall be made based on the Conversion Rate and Share
Payment Component, as applicable, in effect on the date that such Note shall
have been surrendered for conversion, as if the stock transfer books of the
Company had not been closed. Upon conversion of a Note (or any portion of the
principal amount thereof) on the Conversion Date (or such later date as such
person is constituted the record holder of the shares of Common Stock into which
such Note is converted, as provided for in the proviso to the preceding
sentence), such person shall no longer be a Holder of such Note (or such portion
of the principal amount thereof).
Notes surrendered for conversion, other than those called for
redemption pursuant to Section 3.01, during the period from the close of
business on any Regular Record Date to the opening of business on the next
succeeding Interest Payment Date shall be accompanied by payment in New York
Clearing House funds or other funds acceptable to the Company of an amount equal
to the interest (including any Liquidated Damages Amounts or Additional Interest
Amounts that would be due and payable on such Interest Payment Date) to be
received on such Interest Payment Date on the principal amount of Notes being
surrendered for conversion. No such payment will be required if the Notes are
called for redemption pursuant to Section 3.01.
In the case of any Note which is converted in part only, upon
such conversion the Company shall execute and the Trustee shall authenticate and
deliver to the Holder thereof, at the expense of the Company, a new Note or
Notes of authorized denominations in aggregate principal amount equal to the
unconverted portion of the principal amount of such Note.
If shares of Common Stock to be issued upon conversion of a
Restricted Note, or securities to be issued upon conversion of a Restricted Note
in part only, are to be registered in a name other than that of the Holder of
such Restricted Note, such Holder must deliver to the
53
Conversion Agent a certificate in substantially the form set forth in the form
of Note set forth in Exhibit A-1 or A-2 (as applicable) annexed hereto, dated
the date of surrender of such Restricted Note and signed by such Holder, as to
compliance with the restrictions on transfer applicable to such Restricted Note.
Neither the Trustee nor any Conversion Agent or Registrar shall be required to
register in a name other than that of the Holder shares of Common Stock or Notes
issued upon conversion of any such Restricted Note not so accompanied by a
properly completed certificate.
If the last day on which a Note may be converted is a Legal
Holiday, the Note may be surrendered on the next succeeding day that is not a
Legal Holiday.
The Company hereby initially appoints the Trustee as the
Conversion Agent.
SECTION 10.03 Fractions of Shares. No fractional shares of
Common Stock shall be issued upon conversion of any Note or Notes. If more than
one Note shall be surrendered for conversion at one time by the same Holder, the
number of full shares which shall be issued upon conversion thereof shall be
computed on the basis of the aggregate principal amount of the Notes (or
specified portions thereof) so surrendered. Instead of any fractional share of
Common Stock which would otherwise be issued upon conversion of any Note or
Notes (or specified portions thereof), the Company shall pay a cash adjustment
in respect of such fraction (calculated to the nearest one-hundredth of a share)
in an amount equal to the same fraction of the quoted price of the Common Stock
as of the Trading Day preceding the Conversion Date.
SECTION 10.04 Adjustment of Conversion Rate. The
Conversion Rate shall be subject to adjustments, calculated by the Company, from
time to time as follows (without duplication):
(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 Rate in effect at the opening of
business on the date following the date fixed for the determination of
holders of Common Stock entitled to receive such dividend or other
distribution shall be increased by multiplying such Conversion Rate by
a fraction:
(1) the numerator of which shall be the sum of
(x) the number of shares of Common Stock outstanding at the
close of business on the Record Date (as defined in Section
10.04(h)) fixed for such determination and (y) the total
number of shares constituting such dividend or other
distribution payable to the holders of Common Stock; and
(2) the denominator of which shall be the number
of shares of Common Stock outstanding at the close of business
on the Record Date fixed for such determination.
Such increase shall become effective immediately after the opening of
business on the day following the Record Date. If any dividend or
distribution of the type described in this Section 10.04(a) is declared
but not so paid or made, the Conversion Rate shall again
54
be adjusted to the Conversion Rate 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 Rate in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall
be proportionately increased, and conversely, in case outstanding
shares of Common Stock shall be combined into a smaller number of
shares of Common Stock, the Conversion Rate in effect at the opening of
business on the day following the day upon which such combination
becomes effective shall be proportionately reduced, such increase or
reduction, as the case may be, to become effective immediately after
the opening of business on the day following the day upon which such
subdivision or combination becomes effective.
(c) In case the Company shall issue rights or warrants
(other than any rights or warrants referred to in Section 10.04(d)) to
all holders of its outstanding shares of Common Stock entitling them to
subscribe for or purchase shares of Common Stock (or securities
convertible into Common Stock) at a price per share (or having a
conversion price per share) less than the Current Market Price (as
defined in Section 10.04(h)) on the Record Date fixed for the
determination of stockholders entitled to receive such rights or
warrants, the Conversion Rate shall be adjusted so that the same shall
equal the rate determined by multiplying the Conversion Rate in effect
at the opening of business on the date after such Record Date by a
fraction:
(1) the numerator of which shall be the number
of shares of Common Stock outstanding at the close of business
on the Record Date plus the number of additional shares of
Common Stock so offered to the holders of Common Stock for
subscription or purchase (or into which the convertible
securities so offered are convertible), and
(2) the denominator of which shall be the number
of shares of Common Stock outstanding at the close of business
on the Record Date plus the number of shares which the
aggregate offering price of the total number of shares of
Common Stock so offered for subscription or purchase (or the
aggregate conversion price of the convertible securities so
offered, which shall be determined by multiplying the number
of shares of Common Stock issuable upon conversion of such
convertible securities by the conversion price per share of
Common Stock pursuant to the terms of such convertible
securities) would purchase at such Current Market Price.
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 (or securities convertible into
Common Stock) are not delivered pursuant to such rights or warrants,
upon the expiration or termination of such rights or warrants the
Conversion Rate shall be readjusted to the Conversion Rate which would
then be in effect had the adjustments made upon the issuance of such
rights or warrants been made on the basis of the delivery
55
of only the number of additional shares of Common Stock (or securities
convertible into Common Stock) actually delivered. In the event that
such rights or warrants are not so issued, the Conversion Rate shall
again be adjusted to be the Conversion Rate which would then be in
effect if such date fixed for the determination of holders of Common
Stock 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 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 by the Board of
Directors.
(d) (I) 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 10.04(a) or Section 10.04(g) applies),
evidences of indebtedness or other assets (including securities of any
Person other than the Company, but excluding (A) any rights or warrants
referred to in Section 10.04(c), (B) any stock, securities or other
property or assets (including cash) distributed in connection with a
reclassification, merger, consolidation, statutory share exchange,
combination, sale or conveyance to which Section 10.11 hereof applies
(the securities described in foregoing clauses (A) and (B) hereinafter
in this Section 10.04(d) called the "excluded securities") and (C)
dividends or distributions paid exclusively in cash), then in each such
case the Conversion Rate shall be adjusted so that the same shall be
equal to the rate determined by multiplying the Conversion Rate in
effect immediately prior to the close of business on the Record Date
(as defined in Section 10.04(h)) with respect to such distribution by a
fraction:
(1) the numerator of which shall be the Current
Market Price on such Record Date (determined as provided in
Section 10.04(h)), and
(2) the denominator of which shall be such
Current Market Price on such Record Date less the fair market
value (as determined by the Board of Directors, whose
determination shall be conclusive and set forth in a Board
Resolution) on such Record Date of the portion of the Capital
Stock, evidences of indebtedness or other assets so
distributed (other than excluded securities) applicable to one
share of Common Stock (determined on the basis of the number
of shares of the Common Stock outstanding on such Record
Date).
Such increase shall become effective immediately prior to the opening
of business on the day following the Record Date with respect to such
distribution. However, in the event that the then fair market value (as
so determined) of the portion of the Capital Stock, evidences of
indebtedness or other assets so distributed (other than excluded
securities) applicable to one share of Common Stock is equal to or
greater than the Current Market Price on the Record Date with respect
to such distribution, in lieu of the foregoing adjustment, adequate
provision shall be made so that each Holder shall have the right to
receive upon conversion of a Note (or any portion thereof) the amount
of Capital Stock, evidences of indebtedness or other assets so
distributed (other than excluded securities) that such Holder would
have received had such Holder converted such Note (or portion
56
thereof) immediately prior to such Record Date. In the event that such
dividend or distribution is not so paid or made, the Conversion Rate
shall again be adjusted to be the Conversion Rate 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 10.04(d) by reference to
the actual or when issued trading market for any securities comprising
all or part of such distribution (other than excluded securities), 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 10.04(h) to the extent possible, unless the
Board of Directors in a Board Resolution determines in good faith that
determining the fair market value during the Reference Period would not
be in the best interest of the Holder.
(II) With respect to any shareholder rights plan existing on
the date hereof or in the event that the Company implements any other
shareholder rights plan (in each case, a "Rights Agreement"), such
rights plan shall provide, subject to customary exceptions and
limitations, that upon conversion of the Notes the Holders will
receive, in addition to the Common Stock issuable upon such conversion,
the rights (the "Rights") issued under such Rights Agreement
(notwithstanding the occurrence of an event causing such Rights to
separate from the Common Stock at or prior to the time of conversion);
provided, a Holder who is a holder of Common Stock (or direct or
indirect interests therein) at the time of conversion, but who is not
entitled as such a holder to such Rights pursuant to the terms of any
such Rights Agreement, shall not be eligible to receive any such Rights
hereunder. Any distribution of Rights pursuant to a Rights Agreement
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 10.04(d).
(III) 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 10.04(d) (and no adjustment to the Conversion Rate under this
Section 10.04(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
57
warrant (and a termination or expiration of the existing right or
warrant without exercise by the holder thereof).
(IV) 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 paragraph) with respect
thereto, that resulted in an adjustment to the Conversion Rate under
this Section 10.04(d):
(1) in the case of any such rights or warrants
which shall all have been redeemed or repurchased without
exercise by any holders thereof, the Conversion Rate 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 warrant (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 Rate shall be readjusted as if such
rights and warrants had never been issued.
(V) For purposes of this Section 10.04(d) and Sections
10.04(a), 10.04(b) and 10.04(c), any dividend or distribution to which
this Section 10.04(d) is applicable that also includes shares of Common
Stock, a subdivision or combination of Common Stock to which Section
10.04(b) applies, or rights or warrants to subscribe for or purchase
shares of Common Stock to which Section 10.04(c) applies (or any
combination thereof), 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, such
subdivision or combination or such rights or warrants to which
Sections 10.04(a), 10.04(b) and 10.04(c) apply, respectively
(and any Conversion Rate increase required by this Section
10.04(d) with respect to such dividend or distribution shall
then be made), immediately followed by
(2) a dividend or distribution of such shares of
Common Stock, such subdivision or combination or such rights
or warrants (and any further Conversion Rate increase required
by Sections 10.04(a), 10.04(b) and 10.04(c) with respect to
such dividend or distribution shall then be made), except:
(A) the Record Date of such dividend or
distribution shall be substituted for (x) "the date
fixed for the determination of holders of Common
Stock entitled to receive such dividend or other
distribution", "Record Date fixed for such
determinations" and "Record Date" within the meaning
of Section 10.04(a), (y) "the day upon which such
subdivision becomes effective" and "the day upon
which such combination becomes effective" within the
meaning of Section 10.04(b),
58
and (z) "the Record Date fixed for the determination
of stockholders entitled to receive such rights or
warrants" and "Record Date" within the meaning of
Section 10.04(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 10.04(a) and any increase or reduction in the
number of shares of Common Stock resulting from such
subdivision or combination shall be disregarded in
connection with such dividend or distribution.
(e) In case the Company shall, by dividend or otherwise,
distribute (a "Triggering Distribution") to all holders of its Common
Stock cash (excluding any cash that is distributed upon a
reclassification, merger, consolidation, statutory share exchange,
combination, sale or conveyance to which Section 10.11 hereof applies
or as part of a distribution referred to in Section 10.04(d) hereof),
in an aggregate amount that, combined together with:
(x) the aggregate amount of any other such
distributions to all holders of Common Stock made exclusively
in cash within the 12 months preceding the date of payment of
such Triggering Distribution, and in respect of which no
adjustment pursuant to this Section 10.04(e) has been made,
and
(y) the aggregate of any cash plus the fair
market value (as determined by the Board of Directors, whose
determination shall be conclusive and set forth in a Board
Resolution) of any other consideration payable in respect of
any tender offer by the Company or any of its subsidiaries for
all or any portion of the Common Stock concluded within the 12
months preceding the date of payment of such Triggering
Distribution, and in respect of which no adjustment pursuant
to Section 10.04(f) hereof has been made,
exceeds 5% of the product of the Current Market Price (determined as
provided in Section 10.04(h)) on the Business Day (the "Determination
Date") immediately preceding the day on which such Triggering
Distribution is declared by the Company multiplied by the number of
shares of Common Stock outstanding on the Determination Date (excluding
shares held in the treasury of the Company), then and in each such
case, effective immediately prior to the opening of business on the day
following the date on which the Triggering Distribution is paid, the
Conversion Rate shall be increased so that the same shall equal the
rate determined by multiplying the Conversion Rate in effect
immediately prior to the Determination Date by a fraction:
(1) the numerator of which shall be equal to
such Current Market Price on the Determination Date, and
(2) the denominator of which shall be equal to
such Current Market Price on the Determination Date less the
sum of the aggregate amount of cash and the aggregate fair
market value (determined as aforesaid) of any such other
59
consideration so distributed, paid or payable within such 12
months (including, without limitation, the Triggering
Distribution) applicable to one share of Common Stock
(determined on the basis of the number of shares of Common
Stock outstanding on the Determination Date).
However, in the event that the sum of the aggregate amount of cash and
the aggregate fair market value (as so determined) of any such other
consideration so distributed, paid or payable within such 12 months
applicable to one share of Common Stock is equal to or greater than the
Current Market Price on the Determination Date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each
Holder shall have the right to receive upon conversion of a Note (or
any portion thereof) the amount of cash such Holder would have received
had such Holder converted such Note (or portion thereof) immediately
prior to the Record Date with respect to such distribution. In the
event that such dividend or distribution is not so paid or made, the
Conversion Rate shall again be adjusted to be the Conversion Rate which
would then be in effect if such dividend or distribution had not been
declared.
(f) In case a tender offer made by the Company or any of
its subsidiaries for all or any portion of the Common Stock shall
expire and such tender offer (as amended upon the expiration thereof)
shall require the payment to stockholders (based on the acceptance (up
to any maximum specified in the terms of the tender offer) of Purchased
Shares (as defined below)) of an aggregate consideration in an amount
(determined as the sum of the aggregate amount of cash consideration
and the aggregate fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and set forth in a
Board Resolution) of any other consideration) that, combined together
with the aggregate amount of:
(x) the aggregate of the cash plus the fair
market value (as determined by the Board of Directors, whose
determination shall be conclusive and set forth in a Board
Resolution), as of the expiration of such tender offer, of
consideration payable in respect of any other tender offers by
the Company or any of its subsidiaries for all or any portion
of the Common Stock expiring within the 12 months preceding
the expiration of such tender offer and in respect of which no
adjustment pursuant to this Section 10.04(f) has been made,
and
(y) the aggregate amount of any distributions to
all holders of the Company's Common Stock made exclusively in
cash within 12 months preceding the expiration of such tender
offer and in respect of which no adjustment pursuant to
Section 10.04(e) has been made,
exceeds 5% of the product of the Current Market Price (determined as
provided in Section 10.04(h)) as of the last date (the "Expiration
Date") tenders could have been made pursuant to such tender offer (as
it may be amended) (the last time at which such tenders could have been
made on the Expiration Date is hereinafter sometimes referred to as the
"Expiration Time") multiplied by the number of shares of Common Stock
outstanding (including any tendered shares) at the Expiration Time,
then, and in each such case, immediately prior to the opening of
business on the day after the Expiration
60
Date, the Conversion Rate shall be increased so that the same shall
equal the rate determined by multiplying the Conversion Rate in effect
immediately prior to close of business on the Expiration Date by a
fraction:
(1) the numerator of which shall be the sum of
(x) the fair market value (determined as aforesaid) of the
aggregate consideration payable to stockholders based on the
acceptance (up to any maximum specified in the terms of the
tender offer) of all shares of Common Stock validly tendered
and not withdrawn as of the Expiration Time (the shares of
Common Stock deemed so accepted, up to any such maximum, being
referred to as the "Purchased Shares") and (y) the product of
the number of shares of Common Stock outstanding (less any
Purchased Shares) at the Expiration Time and the Current
Market Price (determined as provided in Section 10.04(h)) of
the Common Stock on the Trading Day next succeeding the
Expiration Date, and
(2) the denominator of which shall be the number
of shares of Common Stock outstanding (including any tendered
shares but excluding any shares held in the treasury of the
Company) at the Expiration Time multiplied by such Current
Market Price on the Trading Day next succeeding the Expiration
Date.
Such increase (if any) shall become effective immediately prior to the
opening of business on the day following the Expiration Date. In the
event that the Company is obligated to purchase shares pursuant to any
such tender offer, but the Company is permanently prevented by
applicable law from effecting any or all such purchases or any or all
such purchases are rescinded, the Conversion Rate shall again be
adjusted to be the Conversion Rate which would then be in effect based
upon the number of shares actually purchased. If the application of
this Section 10.04(f) to any tender offer would result in a reduction
in the Conversion Rate, no adjustment shall be made for such tender
offer under this Section 10.04(f).
(g) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock shares of Capital Stock
of any class or series, or similar equity interests, of or relating to
a subsidiary or other business unit of the Company, then, in each such
case, the Conversion Rate shall be adjusted in accordance with the
formula:
R' = R x (1 + F/M)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the average of the Post-Distribution Prices of the
Common Stock for the 10 Trading Days commencing on and including the
fifth Trading Day after the date on which "ex-dividend trading"
commences for such dividend or distribution on the
61
principal United States exchange or market which such securities are
then listed or quoted (the "Ex-Dividend Date").
F = the fair market value of the securities distributed in
respect of each share of Common Stock which for purposes of this
Section 10.04(g) shall mean the number of securities distributed in
respect of each share of Common Stock multiplied by the average of the
Post-Distribution Prices of those securities distributed for the 10
Trading Days commencing on and including the fifth Trading Day after
the Ex-Dividend Date.
"Post-Distribution Price" of Capital Stock or any similar
equity interest on any date means the closing per unit sale price (or,
if no closing sale price is reported, the average of the bid and ask
prices or, if more than one in either case, the average of the average
bid and the average ask prices) on such date for trading of such units
on a "when issued" basis without due bills (or similar concept) as
reported in the composite transactions for the principal United States
securities exchange on which such Capital Stock or equity interest is
traded or, if the Capital Stock or equity interest, as the case may be,
is not listed on a United States national or regional securities
exchange, as reported by the National Association of Securities Dealers
Automated Quotation System or by the National Quotation Bureau
Incorporated; provided that if on any date such units have not traded
on a "when issued" basis, the Post-Distribution Price shall be the
closing per unit sale price (or, if no closing sale price is reported,
the average of the bid and ask prices or, if more than one in either
case, the average of the average bid and the average ask prices) on
such date for trading of such units on a "regular way" basis without
due bills (or similar concept) as reported in the composite
transactions for the principal United States securities exchange on
which such Capital Stock or equity interest is traded or, if the
Capital Stock or equity interest, as the case may be, is not listed on
a United States national or regional securities exchange, as reported
by the National Association of Securities Dealers Automated Quotation
System or by the National Quotation Bureau Incorporated. In the absence
of such quotation, the Company shall be entitled to determine the
Post-Distribution Price on the basis of such quotations that reflect
the post-distribution value of the Capital Stock or equity interests as
it considers appropriate.
(h) For purposes of this Section 10.04, the following
terms shall have the meanings indicated:
(1) "Current Market Price" shall mean the
average of the daily Closing Prices per share of Common Stock
for the ten consecutive Trading Days immediately prior to the
date in question; provided, however, that if:
(i) the "ex" date (as hereinafter
defined) for any event (other than the issuance or
distribution requiring such computation) that
requires an adjustment to the Conversion Rate
pursuant to Section 10.04(a), (b), (c), (d), (e), (f)
or (g) occurs during such ten consecutive Trading
Days, the Closing Price for each Trading Day prior to
the "ex" date for such other event shall be adjusted
by multiplying such Closing Price by the reciprocal
of the fraction by which the Conversion Rate is so
required to be adjusted as a result of such other
event;
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(ii) the "ex" date for any event (other
than the issuance or distribution requiring such
computation) that requires an adjustment to the
Conversion Rate pursuant to Section 10.04(a), (b),
(c), (d), (e), (f) or (g) occurs on or after the "ex"
date for the issuance or distribution requiring such
computation and prior to the day in question, the
Closing Price for each Trading Day on and after the
"ex" date for such other event shall be adjusted by
multiplying such Closing Price by the fraction by
which the Conversion Rate is so required to be
adjusted as a result of such other event; and
(iii) the "ex" date for the issuance or
distribution requiring such computation is prior to
the day in question, after taking into account any
adjustment required pursuant to clause (i) or (ii) of
this proviso, the Closing Price for each Trading Day
on or after such "ex" date shall be adjusted by
adding thereto the amount of any cash and the fair
market value (as determined by the Board of Directors
in a manner consistent with any determination of such
value for purposes of Section 10.04(d) or (f), whose
determination shall be conclusive and set forth 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 any computation under Section 10.04(f), the
Current Market Price of the Common Stock on any date shall be
deemed to be the average of the daily Closing Prices per share
of Common Stock for such day and the next two succeeding
Trading Days; provided, however, that if the "ex" date for any
event (other than the tender offer requiring such computation)
that requires an adjustment to the Conversion Rate pursuant to
Section 10.04(a), (b), (c), (d), (e), (f) or (g) occurs on or
after the Expiration Date for the tender or exchange offer
requiring such computation and prior to the day in question,
the Closing Price for each Trading Day on and after the "ex"
date for such other event shall be adjusted by multiplying
such Closing Price by the fraction by which the Conversion
Rate is so required to be adjusted as a result of such other
event. For purposes of this paragraph, the term "ex" date,
when used:
(A) with respect to any issuance or
distribution, means the first date on which the Common 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;
(B) with respect to any subdivision or
combination of shares of Common Stock, means the first date on
which the Common Stock trades regular way on such exchange or
in such market after the time at which such subdivision or
combination becomes effective, and
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(C) with respect to any tender or exchange
offer, means the first date on which the Common Stock trades
regular way on such exchange or in such market after the
Expiration Time of such offer.
Notwithstanding the foregoing, whenever successive adjustments to the
Conversion Rate are called for pursuant to this Section 10.04, such
adjustments shall be made to the Current Market Price as may be
necessary or appropriate to effectuate the intent of this Section 10.04
and to avoid unjust or inequitable results as determined in good faith
by the Board of Directors.
(2) "fair market value" shall mean the amount
which a willing buyer would pay a willing seller in an arm's
length transaction.
(3) "Record Date" shall mean, with respect to
any dividend, distribution or other transaction or event in
which the holders of Common 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).
(i) The Company may make such increases in the Conversion
Rate, in addition to those required by Section 10.04(a), (b), (c), (d),
(e), (f) or (g), 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 increase the Conversion Rate by any amount for any
period of time if the period is at least 20 days and the increase is
irrevocable during the period and the Board of Directors determines in
good faith that such increase would be in the best interests of the
Company, which determination shall be conclusive and set forth in a
Board Resolution. Whenever the Conversion Rate is increased pursuant to
the preceding sentence, the Company shall mail to the Trustee and each
Holder at the address of such Holder as it appears in the Register a
notice of the increase at least 15 days prior to the date the increased
Conversion Rate takes effect, and such notice shall state the increased
Conversion Rate and the period during which it will be in effect.
(j) No adjustment in the Conversion Rate shall be
required unless such adjustment would require an increase or decrease
of at least 1% in such rate; provided, however, that any adjustments
which by reason of this Section 10.04(j) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Article 10 shall be made by the
Company and shall be made to the nearest cent or to the nearest one
thousandth of a share, as the case may be. No
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adjustment need be made for a change in the par value or no par value
of the Common Stock.
(k) In any case in which this Section 10.04 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 10.03 hereof.
(l) For purposes of this Section 10.04, 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 10.05 Notice of Adjustments of Conversion
Rate. Whenever the Conversion Rate is adjusted as herein provided (other than in
the case of an adjustment pursuant to the second paragraph of Section 10.04(i)
for which the notice required by such paragraph has been provided), the Company
shall promptly file with the Trustee and any Conversion Agent other than the
Trustee an Officers' Certificate setting forth the adjusted Conversion Rate and
showing in reasonable detail the facts upon which such adjustment is based and
the date on which such adjustment becomes effective. Promptly after delivery of
such Officers' Certificate, the Company shall prepare a notice stating that the
Conversion Rate has been adjusted and setting forth the adjusted Conversion Rate
and the date on which each adjustment becomes effective, and shall mail such
notice to each Holder at the address of such Holder as it appears in the
Register within 20 days of the effective date of such adjustment. Failure to
deliver such Officers' Certificate or such notice shall not affect the legality
or validity of any such adjustment.
SECTION 10.06 Notice Prior to Certain Actions. In case at
any time after the date hereof:
(1) the Company shall declare a dividend (or any other
distribution) on its Common Stock payable otherwise than in cash out of
its capital surplus or its consolidated retained earnings;
(2) the Company shall authorize the granting to the
holders of its Common Stock of rights or warrants to subscribe for or
purchase any shares of Capital Stock of any class (or of securities
convertible into shares of Capital Stock of any class) or of any other
rights;
(3) there shall occur any reclassification of the Common
Stock of the Company (other than a subdivision or combination of its
outstanding Common Stock, a change in par value, a change from par
value to no par value or a change from no par value to par value), or
any merger, consolidation, statutory share exchange or
65
combination to which the Company is a party and for which approval of
any shareholders of the Company is required, or the sale, transfer or
conveyance of all or substantially all of the assets of the Company; or
(4) there shall occur the voluntary or involuntary
dissolution, liquidation or winding up of the Company;
the Company shall cause to be filed at each office or agency maintained for the
purpose of conversion of Notes pursuant to Section 4.05 hereof, and shall cause
to be provided to the Trustee and all Holders in accordance with Section 13.02
hereof, at least 20 days (or 10 days in any case specified in clause (1) or (2)
above) prior to the applicable record or effective date hereinafter specified, a
notice stating:
(A) the date on which a record is to be taken
for the purpose of such dividend, distribution, rights or
warrants, or, if a record is not to be taken, the date as of
which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights or warrants are to be
determined, or
(B) the date on which such reclassification,
merger, consolidation, statutory share exchange, combination,
sale, transfer, conveyance, dissolution, liquidation or
winding up is expected to become effective, and the date as of
which it is expected that holders of Common Stock of record
shall be entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such
reclassification, merger, consolidation, statutory share
exchange, sale, transfer, dissolution, liquidation or winding
up.
Neither the failure to give such notice nor any defect therein
shall affect the legality or validity of the proceedings or actions described in
clauses (1) through (4) of this Section 10.06.
SECTION 10.07 Company to Reserve Common Stock. The Company
shall at all times use its best efforts to reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock, for the
purpose of effecting the conversion of Notes, the full number of shares of fully
paid and nonassessable Common Stock then issuable upon the conversion of all
Notes outstanding.
SECTION 10.08 Taxes on Conversions. Except as provided in
the next sentence, the Company will pay any and all taxes (other than taxes on
income) and duties that may be payable in respect of the issue or delivery of
shares of Common Stock on conversion of Notes pursuant hereto. A Holder
delivering a Note for conversion shall be liable for and will be required to pay
any tax or duty which may be payable in respect of any transfer involved in the
issue and delivery of shares of Common Stock in a name other than that of the
Holder of the Note or Notes to be converted, and no such issue or delivery shall
be made unless the Person requesting such issue has paid to the Company the
amount of any such tax or duty, or has established to the satisfaction of the
Company that such tax or duty has been paid.
SECTION 10.09 Covenant as to Common Stock. The Company
covenants that all shares of Common Stock which may be issued upon conversion of
Notes will upon issue
66
be fully paid and nonassessable and, except as provided in Section 10.08, the
Company will pay all taxes, liens and charges with respect to the issue thereof.
SECTION 10.10 Cancellation of Converted Notes. All Notes
delivered for conversion shall be delivered to the Trustee to be canceled by or
at the direction of the Trustee, which shall dispose of the same as provided in
Section 2.10.
SECTION 10.11 Effect of Reclassification, Consolidation,
Merger or Sale. If any of following events occur, namely:
(1) 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),
(2) any merger, consolidation, statutory share exchange
or combination of the Company with another corporation as a result of
which holders of Common Stock shall be entitled to receive stock,
securities or other property or assets (including cash or any
combination thereof) with respect to or in exchange for such Common
Stock, or
(3) any sale or conveyance of all or substantially all of
the properties and assets of the Company to any other corporation as a
result of which holders of Common Stock shall be entitled to receive
stock, securities or other property or assets (including cash or any
combination thereof) with respect to or in exchange for such Common
Stock,
the Company or the successor or purchasing corporation, as the case may
be, shall, as a condition precedent to such reclassification, change,
merger, consolidation, statutory share exchange, combination, sale or
conveyance, execute with the Trustee a supplemental indenture (which
shall comply with the TIA as in force at the date of execution of such
supplemental indenture if such supplemental indenture is then required
to so comply) providing that such Note shall be convertible into the
kind and amount of shares of stock and other securities or property or
assets (including cash or any combination thereof) which such Holder
would have been entitled to receive upon such reclassification, change,
merger, consolidation, statutory share exchange, combination, sale or
conveyance had such Notes been converted into Common Stock immediately
prior to such reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or conveyance assuming such
holder of Common Stock did not exercise its rights of election, if any,
as to the kind or amount of securities, cash or other property
receivable upon such reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or conveyance (provided
that, if the kind or amount of securities, cash or other property
receivable upon such reclassification, change, merger, consolidation,
statutory share exchange, combination, sale or conveyance is not the
same for each share of Common Stock in respect of which such rights of
election shall not have been exercised ("Non-Electing Share"), then for
the purposes of this Section 10.11 the kind and amount of securities,
cash or other property receivable upon such reclassification, change,
merger, consolidation, statutory share exchange, combination, sale or
conveyance for each Non-Electing Share shall be deemed to be the kind
and amount so receivable per share by a plurality of the Non-Electing
Shares). Such
67
supplemental indenture shall provide for adjustments which shall be as
nearly equivalent as may be practicable to the adjustments provided for
in this Article 10. If, in the case of any such reclassification,
change, merger, consolidation, statutory share exchange, combination,
sale or conveyance, the stock or other securities and assets receivable
thereupon by a holder of shares of Common Stock includes shares of
stock or other securities and assets of a corporation other than the
successor or purchasing corporation, as the case may be, in such
reclassification, change, merger, consolidation, statutory share
exchange, combination, sale or conveyance, then such supplemental
indenture shall also be executed by such other corporation and shall
contain such additional provisions to protect the interests of the
Holders of the Notes as the 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 Section 3.09 hereof.
The Company shall cause notice of the execution of such
supplemental indenture to be mailed to each Holder, at the address of such
Holder as it appears on the Register, within 20 days after execution thereof.
Failure to deliver such notice shall not affect the legality or validity of such
supplemental indenture.
The above provisions of this Section 10.11 shall similarly
apply to successive reclassifications, mergers, consolidations, statutory share
exchanges, combinations, sales and conveyances.
If this Section 10.11 applies to any event or occurrence,
Section 10.04 hereof shall not apply.
SECTION 10.12 Responsibility of Trustee for Conversion
Provisions. The Trustee, subject to the provisions of Section 7.01 hereof, and
any Conversion Agent shall not at any time be under any duty or responsibility
to any Holder of Notes to determine whether any facts exist which may require
any adjustment of the Conversion Rate, or with respect to the nature or intent
of any such adjustments when made, or with respect to the method employed, or
herein or in any supplemental indenture provided to be employed, in making the
same or the calculation thereof. Neither the Trustee, subject to the provisions
of Section 7.01 hereof, nor any Conversion Agent shall be accountable with
respect to the validity or value (of the kind or amount) of any Common Stock, or
of any other securities or property, which may at any time be issued or
delivered upon the conversion of any Note; and it or they do not make any
representation with respect thereto. Neither the Trustee, subject to the
provisions of Section 7.01 hereof, nor any Conversion Agent shall be responsible
for any failure of the Company to make any cash payment or to issue, transfer or
deliver any shares of stock or share certificates or other securities or
property upon the surrender of any Note for the purpose of conversion; and the
Trustee, subject to the provisions of Section 7.01 hereof, and any Conversion
Agent shall not be responsible or liable for any failure of the Company to
comply with any of the covenants or other obligations of the Company contained
in this Article.
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ARTICLE 11
DIVIDEND PROTECTION PAYMENT
SECTION 11.01 Additional Interest Amounts. In the event
the Company declares a dividend on its Common Stock, the Company shall pay to
each Holder of record as of the record date for such dividend an amount equal to
the product of (i) such per share dividend declared by the Company multiplied by
(ii) the number of shares of Common Stock such Holder would possess had such
Holder converted its Notes into a number of shares of Common Stock equal to the
Conversion Rate as of the record date for such dividend (each such payment an
"Additional Interest Amount and, collectively the "Additional Interest
Amounts"); provided, however, that such amount shall not be due and no payment
with respect thereto shall be made with respect to the Notes unless such
dividend is paid to holders of Common Stock. The payment date for an Additional
Interest Amount shall be the same as the payment date for the dividend to which
the Additional Interest Amount relates. Holders of Notes shall not be entitled
to receive any Additional Interest Amount with respect to any dividend that
causes an adjustment to the Conversion Rate.
ARTICLE 12
SECURITY
SECTION 12.01 Security. (a) On the date of this Indenture,
the Company shall (i) enter into the Pledge Agreement and comply with the terms
and provisions thereof and (ii) purchase the Pledged Securities to be pledged to
the Trustee for the benefit of the Holders in such amount as will be sufficient
upon receipt of scheduled interest and/or of principal payments of such Pledged
Securities to provide for payment in full of the first five scheduled interest
payments (up to and including the interest payment due on August 14, 2005) due
on the Notes. The Pledged Securities shall be pledged by the Company to the
Trustee for the benefit of the Holders and shall be held by the Trustee in the
Pledge Account pending disposition pursuant to the Pledge Agreement.
(b) Each Holder, by its acceptance of a Note, consents and
agrees to the terms of the Pledge Agreement (including, without limitation, the
provisions providing for foreclosure and release of the Pledged Securities) as
the same may be in effect or may be amended from time to time in accordance with
its terms, and authorizes and directs the Trustee to enter into the Pledge
Agreement and to perform its respective obligations and exercise its respective
rights thereunder in accordance therewith. The Company will do or cause to be
done all such acts and things as may be necessary or reasonably requested by the
Trustee, or as may be required by the provisions of the Pledge Agreement, to
assure and confirm to the Trustee the security interest in the Pledged
Securities contemplated hereby, by the Pledge Agreement or any part thereof, as
from time to time constituted, so as to render the same available for the
security and benefit of this Indenture and of the Notes secured hereby,
according to the intent and purposes herein and therein expressed. The Company,
in consultation with the Trustee, shall take, or shall cause to be taken, any
and all actions reasonably required to cause the Pledge Agreement to create and
maintain, as security for the obligations of the Company under this Indenture
and the Notes,
69
valid and enforceable first priority liens in and on all the Pledged Securities,
in favor of the Trustee, superior to and prior to the rights of third Persons
and subject to no other Liens.
(c) The release of any Pledged Securities pursuant to the
Pledge Agreement will not be deemed to impair the security under this Indenture
in contravention of the provisions hereof if and to the extent the Pledged
Securities are released pursuant to this Indenture and the Pledge Agreement. To
the extent applicable, the Company shall cause TIA Section 314(d) relating to
the release of property or securities from the Lien and security interest of the
Pledge Agreement and relating to the substitution therefor of any property or
securities to be subjected to the Lien and security interest of the Pledge
Agreement to be complied with. Any certificate or opinion required by TIA
Section 314(d) may be made by an Officer of the Company, except in cases where
TIA Section 314(d) requires that such certificate or opinion be made by an
independent Person, which Person shall be an independent engineer, appraiser or
other expert selected by the Company.
(d) The Company shall cause TIA Section 314(b), relating to
opinions of counsel regarding the Lien under the Pledge Agreement, to be
complied with. The Trustee may accept, to the extent permitted by Sections 4.03
and 7.13 as conclusive evidence of compliance with the foregoing provisions, the
appropriate statements contained in such instruments.
(e) The Trustee may, in its sole discretion and without the
consent of the Holders, on behalf of the Holders, take all reasonable actions in
accordance with the Pledge Agreement necessary or appropriate in order to (i)
enforce any of the terms of the Pledge Agreement and (ii) collect and receive
any and all amounts payable in respect of the obligations of the Company
thereunder. The Trustee shall have power to institute and to maintain such suits
and proceedings as the Trustee may reasonably deem expedient to preserve or
protect its interests and the interests of the Holders in the Pledged Securities
(including power to institute and maintain suits or proceedings to restrain the
enforcement of or compliance with any legislative or other governmental
enactment, rule or order that may be unconstitutional or otherwise invalid if
the enforcement of, or compliance with, such enactment, rule or order would
impair the security interest hereunder or be prejudicial to the interests of the
Holders or of the Trustee).
ARTICLE 13
MISCELLANEOUS
SECTION 13.01 Trust Indenture Act Controls. If any
provision of this Indenture limits, qualifies, or conflicts with another
provision which is required to be included in this Indenture by the TIA, the
required provision shall control.
SECTION 13.02 Notices. Any request, demand, authorization,
notice, waiver, consent or other communication shall be in writing and delivered
in person or mailed by first-class mail, postage prepaid, addressed as follows
or transmitted by facsimile transmission (confirmed by guaranteed overnight
courier) to the following facsimile numbers:
70
if to the Company:
Sierra Pacific Resources
6100 Neil Road
Reno, Nevada 89520-0400
Telephone No. (775) 834-5643
Facsimile No. (775) 834-5462
Attention: Kelly Langley
if to the Trustee:
The Bank of New York
101 Barclay Street, 8W
New York, New York 10286
Attention: Corporate Trust Division
Telephone No. (212) 815-5845
Facsimile No. (212) 815-5707
The Company or the Trustee by notice given to the other in the
manner provided above may designate additional or different addresses for
subsequent notices or communications.
Except as otherwise provided in this Indenture, no notice or
other communication given hereunder to the Trustee shall be deemed to be given
or effective unless and until it is actually received by the Trustee at the
aforementioned address.
Any notice or other communication given to a Noteholder shall
be mailed to the Noteholder, by first-class mail, postage prepaid, at the
Noteholder's address as it appears on the registration books of the Registrar
and shall be sufficiently given if so mailed within the time prescribed.
Failure to mail a notice or communication to a Noteholder or
any defect in it shall not affect its sufficiency with respect to other
Noteholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not received by the addressee.
If the Company mails a notice or communication to the
Noteholders, it shall mail a copy to the Trustee and each Registrar, Paying
Agent, Conversion Agent or co-registrar.
SECTION 13.03 Communication by Holders with Other Holders.
Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Registrar, the Paying Agent, the Conversion Agent and
anyone else shall have the protection of TIA Section 312(c).
SECTION 13.04 Certificate and Opinion as to Conditions
Precedent. Upon any request or application by the Company to the Trustee to take
any action under this Indenture (except that, in the case of any request or
application as to which the furnishing of such
71
documents is specifically required by any provision of this Indenture relating
to such particular request or application, no additional certificate or opinion
need be furnished), the Company shall furnish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of
the signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied with.
SECTION 13.05 Statements Required in Certificate or
Opinion. Each Officers' Certificate or Opinion of Counsel with respect to
compliance with a covenant or condition provided for in this Indenture shall
include:
(1) a statement that each person making such Officers'
Certificate or Opinion of Counsel has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such Officers' Certificate or Opinion of Counsel are
based;
(3) a statement that, in the opinion of each such person, he
has made such examination or investigation as is necessary to enable
such person to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement that, in the opinion of such person, such
covenant or condition has been complied with.
SECTION 13.06 Separability Clause. In case any provision
in this Indenture or in the Notes shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 13.07 Rules by Trustee, Paying Agent, Conversion
Agent and Registrar. The Trustee may make reasonable rules for action by or a
meeting of Noteholders. The Registrar, Conversion Agent and the Paying Agent may
make reasonable rules for their functions.
SECTION 13.08 Legal Holidays. A "Legal Holiday" is any day
other than a Business Day. If any specified date (including a date for giving
notice) is a Legal Holiday, the action shall be taken on the next succeeding day
that is not a Legal Holiday, and, if the action to be taken on such date is a
payment in respect of the Notes, no interest, if any, shall accrue for the
intervening period.
SECTION 13.09 GOVERNING LAW. THIS INDENTURE AND THE NOTES
WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
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SECTION 13.10 No Recourse Against Others. A director,
officer, employee or stockholder, as such, of the Company shall not have any
liability for any obligations of the Company under the Notes or this Indenture
or for any claim based on, in respect of or by reason of such obligations or
their creation. By accepting a Note, each Noteholder shall waive and release all
such liability. The waiver and release shall be part of the consideration for
the issue of the Notes.
SECTION 13.11 Successors. All agreements of the Company in
this Indenture and the Notes shall bind its successor. All agreements of the
Trustee in this Indenture shall bind its successor.
SECTION 13.12 Multiple Originals. The parties may sign any
number of copies of this Indenture. Each signed copy shall be an original, but
all of them together represent the same agreement. One signed copy is enough to
prove this Indenture.
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IN WITNESS WHEREOF, the undersigned, being duly authorized,
have executed this Indenture on behalf of the respective parties hereto as of
the date first above written.
SIERRA PACIFIC RESOURCES
By: ___________________________
Name:
Title:
THE BANK OF NEW YORK, as Trustee
By: ___________________________
Name: Stacy B. Poindexter
Title: Assistant Treasurer
EXHIBIT A-1
[FORM OF GLOBAL NOTE]
[Form of Face of Global Note]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY, OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN ARTICLE TWO OF THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE, THE
SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE NOR ANY INTEREST OR
PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER,
SELL, OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH SIERRA PACIFIC RESOURCES
(THE "COMPANY") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR
ANY PREDECESSOR OF SUCH NOTE) ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF,
(B) FOR SO LONG AS THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON
CONVERSION OF THIS NOTE ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED
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INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (C) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED
BY RULE 144 UNDER THE SECURITIES ACT, IF AVAILABLE, (D) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT AND CONTINUES TO BE EFFECTIVE AT THE TIME OF TRANSFER OR (E) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES
ACT. IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSES (C) OR (E) ABOVE, SUCH
TRANSFER IS SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHTS PRIOR TO ANY SUCH
OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO THE COMPANY, AND IN EACH
OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE
OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE. THE HOLDER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE
SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN PURSUANT TO CLAUSE D ABOVE)
A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
[THE FOREGOING LEGEND MAY BE REMOVED FROM THIS NOTE ON SATISFACTION OF
THE CONDITIONS SPECIFIED IN THE INDENTURE.]
A-1-2
SIERRA PACIFIC RESOURCES
7.25% Convertible Notes due 2010
No.: 1 CUSIP: 826428 AE 4
Issue Date: ISIN: US826428AE48
SIERRA PACIFIC RESOURCES, a Nevada corporation (the "Company"),
promises to pay to Cede & Co. or registered assigns, the principal sum of THREE
HUNDRED MILLION DOLLARS ($300,000,000) on February 14, 2010.
This Note shall bear interest as specified on the other side of this
Note. This Note is convertible as specified on the other side of this Note.
Additional provisions of this Note are set forth on the other side of
this Note.
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IN WITNESS WHEREOF, the Company has caused this Note to be
signed manually or by facsimile by its duly authorized officer.
Dated: February __, 2003 SIERRA PACIFIC RESOURCES
By_________________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK,
as Trustee, certifies that this
is one of the Notes referred
to in the within-mentioned Indenture (as
defined on the other side of this Note).
By_____________________________
Authorized Signatory
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[Form of Reverse Side of Note]
7.25% Convertible Note due 2010
1. Cash Interest.
The Company promises to pay interest in cash on the principal amount of
this Note at the rate per annum of 7.25%. The Company will pay cash
interest semiannually in arrears on February 14 and August 14 of each
year (each an "Interest Payment Date") to Holders of record at the
close of business on January 31 and July 31 (whether or not a business
day) (each a "Regular Record Date"), as the case may be, immediately
preceding such Interest Payment Date. Cash interest on the Notes will
accrue from the most recent date to which interest has been paid or
duly provided or, if no interest has been paid, from the Issue Date.
Cash interest will be computed on the basis of a 360-day year of twelve
30-day months.
In accordance with the terms of the Registration Rights Agreement,
during the first 90 days following the day on which an Event (as
defined in the Registration Rights Agreement) has occurred and is
continuing, the Interest Rate borne by the Notes shall be increased by
0.25% to 7.5% per annum. From and after the 91st day following the day
on which an Event has occurred and such Event is continuing, the
Interest Rate borne by the Notes shall be increased by an additional
0.25% to 7.75% per annum. In no event shall the Interest Rate borne by
the Notes exceed 7.75% per annum. Any amount of additional interest
will be payable in cash semiannually, in arrears, on each Interest
Payment Date and will cease to accrue on the date the Event is cured.
The Holder of this Note is entitled to the benefits of the Registration
Rights Agreement.
The Holder of this Note is entitled to the benefits of the Pledge
Agreement, dated February 14, 2003, between the Company and The Bank of
New York (the "Trustee"), pursuant to which the Company has placed in
the Pledge Account cash or Pledged Financial Assets sufficient to
provide for the payment of the first five interest payments (up to and
including the interest payment due on August 14, 2005) on this Note.
The terms capitalized but undefined in this paragraph have the meanings
given to them in the Pledge Agreement.
2. Payment of Additional Interest Amounts.
In the event the Company declares a dividend on its Common Stock, the Company
shall pay to each Holder of record as of the record date for such dividend an
amount equal to the product of (i) such per share dividend declared by the
Company multiplied by (ii) the number of shares of Common Stock such Holder
would possess had such Holder converted its Notes into a number of shares of
Common Stock equal to the Conversion Rate as of the record date for such
dividend (each such payment an "Additional Interest Amount and, collectively the
"Additional Interest Amounts"); provided, however, that such amount shall not be
due and no payment with respect thereto shall be made with respect to the Notes
unless such dividend is paid to holders of Common Stock. The payment date for an
Additional Interest Amount shall be the same as the
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payment date for the dividend to which the Additional Interest Amount relates.
Holders of Notes shall not be entitled to receive any Additional Interest Amount
with respect to any dividend that causes an adjustment to the Conversion Rate.
3. Method of Payment.
Subject to the terms and conditions of the Indenture, the Company will make
payments in respect of the principal of, premium, if any, and cash interest on
this Note to a Paying Agent. In respect of Redemption Prices and Change of
Control Repurchase Prices, the Company will make payments in respect of the
principal of, premium, if any, and cash interest on this Note to Holders who
surrender Notes to a Paying Agent to collect such payments in respect of the
Notes. The Company will pay cash amounts in money of the United States that at
the time of payment is legal tender for payment of public and private debts.
However, the Company may make such cash payments by check payable in such money.
A holder of Notes with an aggregate principal amount in excess of $10,000,000
will be paid by wire transfer in immediately available funds at the election of
such holder. Any payment required to be made on any day that is not a Business
Day will be made on the next succeeding Business Day.
4. Paying Agent, Conversion Agent and Registrar.
Initially, the Trustee will act as Paying Agent, Conversion Agent and Registrar.
The Company may appoint and change any Paying Agent, Conversion Agent, Registrar
or co-registrar without notice, other than notice to the Trustee, except that
the Company will maintain at least one Paying Agent in the State of New York,
The City of New York, and Borough of Manhattan, which shall initially be an
office or agency of the Trustee. The Company or any of its Subsidiaries or any
of their Affiliates may act as Paying Agent, Conversion Agent, Registrar or
co-registrar.
5. Indenture.
The Company issued the Notes under an Indenture dated as of February
14, 2003 (the Indenture"), between the Company and the Trustee. The
terms of the Notes include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939,
as in effect from time to time (the "TIA"). Capitalized terms used
herein and not defined herein have the meanings ascribed thereto in the
Indenture. The Notes are subject to all such terms, and Noteholders are
referred to the Indenture and the TIA for a statement of those terms.
The Notes are general unsecured obligations of the Company (except as
provided in Article 12 of the Indenture) limited to $300,000,000
aggregate principal amount. The Indenture does not limit other
indebtedness of the Company, secured or unsecured.
6. Redemption of the Notes at the Option of the Company.
At any time on or after February 14, 2008, the Company may redeem the Notes in
whole at any time or in part from time to time upon not less than 30 nor more
than 60 days' notice, at the following prices (expressed in percentages of the
principal amount) together with accrued but unpaid interest to, but excluding,
the date fixed for redemption. However, if a redemption date is
A-1-6
any interest payment date, the semi-annual payment of interest becoming due on
such date shall be payable to the holder of record as of the relevant record
date and the redemption price shall not include such interest payment.
During the twelve months commencing February 14 of the years set forth
below:
Year Redemption Price
---- ----------------
2008................................ 102.1%
2009................................ 101.0%
If the Company does not redeem all the Notes, the Trustee will select
the Notes to be redeemed in principal amounts of $1,000 or integral
multiples of $1,000 by lot or on a pro rata basis. If any Notes are to
be redeemed in part only, a new Note or Notes in principal amount equal
to the unredeemed principal portion thereof will be issued. If a
portion of a Holder's Notes is selected for partial redemption and the
Holder converts a portion of its Notes, the converted portion will be
deemed to be taken from the portion selected for redemption.
No sinking fund is provided for the Notes.
7. Repurchase by the Company at the Option of the Holder.
If a Change of Control occurs, the Holder, at the Holder's option, shall have
the right, in accordance with the provisions of the Indenture, to require the
Company to repurchase the Notes (or any portion of the principal amount hereof
that is at least $1,000 or an integral multiple thereof, provided that the
portion of the principal amount of this Note to be outstanding after such
repurchase is at least equal to $1,000) at the Change of Control Repurchase
Price in cash, plus any interest accrued and unpaid to, but excluding, the
Change of Control Repurchase Date.
A Change of Control Repurchase Notice will be given by the Company to the
Holders as provided in the Indenture. To exercise a repurchase right, a Holder
must deliver to the Trustee a written notice as provided in the Indenture.
Holders have the right to withdraw any Change of Control Repurchase Notice by
delivering to the Paying Agent a written notice of withdrawal in accordance with
the provisions of the Indenture.
8. Notice of Redemption.
Notice of redemption will be mailed not less than 30 days but not more
than 60 days before the Redemption Date to each Holder of Notes to be
redeemed at the Holder's registered address. If money sufficient to pay
the Redemption Price of all Notes (or portions thereof) to be redeemed
on the Redemption Date is deposited with the Paying Agent prior to or
on the Redemption Date, immediately after such Redemption Date interest
ceases to accrue on such Notes or portions thereof. Notes in
denominations
A-1-7
larger than $1,000 of principal amount may be redeemed in part but only
in integral multiples of $1,000 of principal amount.
9. Conversion.
The Notes will not be convertible prior to August 14, 2003. At any time on or
after August 14, 2003, subject to and upon compliance with the provisions of the
Indenture, at the option of the Holder thereof, any Note or any portion of the
principal amount thereof which is $1,000 or an integral multiple of $1,000 may
be converted at the principal amount thereof, or of such portion thereof, into a
combination of cash and duly authorized, fully paid and nonassessable shares of
Common Stock (or, in the event that the Shareholder Approval Condition described
in the Indenture shall have been satisfied and the Company so elects, entirely
into shares of Common Stock) as provided in the Indenture. Such conversion right
shall expire at the close of business on February 14, 2010.
The "Conversion Rate" shall initially be 219.1637 and shall be adjusted in
certain instances as provided in the Indenture. The "Share Payment Component"
shall initially be 76.7073 and shall be subject to adjustment in the same manner
and under the same circumstances as the Conversion Rate, subject to any
limitation under applicable rules of the New York Stock Exchange.
The Company shall pay a cash adjustment as provided in the Indenture in
lieu of any fractional share of Common Stock.
To convert a Note, a Holder must (1) complete and sign the conversion
notice below (or complete and sign a facsimile of such notice) and
deliver such notice to the Conversion Agent, (2) surrender the Note
duly signed and endorsed to the Conversion Agent, (3) furnish
appropriate endorsements and transfer documents if required by the
Conversion Agent, the Company or the Trustee and (4) pay any transfer
or similar tax or payment detailed below, if required.
Notes surrendered for conversion, other than those called for
redemption pursuant to paragraph 6 above, during the period from the
close of business on any Regular Record Date to the opening of business
on the next succeeding Interest Payment Date shall be accompanied by
payment in New York Clearing House funds or other funds acceptable to
the Company of an amount equal to the interest (including any
Liquidated Damages Amounts or Additional Interest Amounts that would be
due and payable on such Interest Payment Date) to be received on such
Interest Payment Date on the principal amount of Notes being
surrendered for conversion. No such payment will be required if the
Notes are called for redemption pursuant to paragraph 6 above.
10. Conversion Arrangement on Call for Redemption.
Any Notes called for redemption, unless surrendered for conversion
before the close of business on the Redemption Date, may be deemed to
be purchased from the Holders of such Notes at an amount not less than
the Redemption Price, by one or more investment bankers or other
purchasers who may agree with the Company to purchase such Notes
A-1-8
from the Holders, to convert them into Common Stock of the Company and
to make payment for such Notes to the Trustee in trust for such
Holders.
11. Denominations; Transfer; Exchange.
The Notes are in fully registered form, without coupons, in denominations of
$1,000 of principal amount and integral multiples of $1,000. A Holder may
transfer or exchange Notes in accordance with the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not transfer or exchange (i) any Notes
selected for redemption (except, in the case of a Note to be redeemed in part,
the portion of the Note not to be redeemed), (ii) any Notes in respect of which
a Change of Control Repurchase Notice has been given and not withdrawn (except,
in the case of a Note to be purchased in part, the portion of the Note not to be
purchased) or (iii) any Notes for a period of 15 days before the mailing of a
notice of redemption of Notes to be redeemed.
12. Persons Deemed Owners.
The registered Holder of this Note may be treated as the owner of this Note for
all purposes.
13. Unclaimed Money or Notes.
The Trustee and the Paying Agent shall return to the Company upon
written request any money or Notes held by them for the payment of any
amount with respect to the Notes that remains unclaimed for two years,
subject to applicable unclaimed property law. After return to the
Company, Holders entitled to the money or Notes must look to the
Company for payment as general creditors unless an applicable abandoned
property law designates another person.
14. Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the Indenture or
the Notes may be amended with the written consent of the Holders of at least a
majority in aggregate principal amount of the Notes at the time outstanding and
(ii) certain Defaults may be waived with the written consent of the Holders of a
majority in aggregate principal amount of the Notes at the time outstanding.
Subject to certain exceptions set forth in the Indenture, without the consent of
any Noteholder, the Company and the Trustee may amend the Indenture or the Notes
to cure any ambiguity, omission, defect or inconsistency, or to comply with
Article 5 of the Indenture, to make any change that does not adversely affect
the rights of any Noteholder, or to comply with any requirement of the SEC in
connection with the qualification of the Indenture under the TIA.
15. Defaults and Remedies.
Under the Indenture, Events of Default include (1) the Company fails to pay when
due the principal of or premium, if any, on any of the Notes at maturity, upon
redemption or exercise of a repurchase right or otherwise; (2) the Company fails
to pay an installment of interest (including Liquidated Damages Amounts and
Additional Interest Amounts, if any) on any of the Notes that continues for 30
days after the date when due, provided that a failure to make or provide for the
A-1-9
payment of any of the first five scheduled interest payments on the Notes within
3 Business Days after an Interest Payment Date will constitute an Event of
Default with no additional grace or cure period; (3) the Company fails to (A)
deliver shares of Common Stock, together with cash in lieu of fractional shares,
when such Common Stock or cash in lieu of fractional shares is required to be
delivered upon conversion of a Note, or (B) make payment of the Cash Payment
Component when such cash is required to be delivered upon conversion of a Note,
and, in each case, that failure continues for 10 days after the relevant
delivery date; (4) the Company fails to perform or observe any other term,
covenant or agreement contained in the Notes or the Indenture for a period of 60
days after 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
the Trustee by the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding; (5) (A) the Company or any Significant Subsidiary fails
to pay at maturity (after giving effect to any applicable grace period) any
Indebtedness in an aggregate principal amount in excess of $10 million or (B)
any of the Company's Indebtedness, or Indebtedness of any Significant
Subsidiary, aggregating $10 million or more shall have been accelerated and
declared due and payable prior to the scheduled maturity thereof, and such
acceleration is not rescinded or annulled within a 30-day period after the date
of such acceleration; (6) certain events of bankruptcy, insolvency or
reorganization with respect to the Company or any Significant Subsidiary; and
(7) the Pledge Agreement shall cease to be in full force and effect or
enforceable in accordance with its terms, prior to the termination thereof in
accordance with Section 18 of the Pledge Agreement. If an Event of Default
(other than an Event of Default specified in clause (6) above) occurs and is
continuing, the Trustee, or the Holders of at least 25% in aggregate principal
amount of the Notes at the time outstanding, may declare all the Notes to be due
and payable immediately. Certain events of bankruptcy or insolvency are Events
of Default which will result in the Notes becoming due and payable immediately
upon the occurrence of such Events of Default.
Noteholders may not enforce the Indenture or the Notes except as
provided in the Indenture. The Trustee may refuse to enforce the
Indenture or the Notes unless it receives reasonable indemnity or
security. Subject to certain limitations, Holders of a majority in
aggregate principal amount of the Notes at the time outstanding may
direct the Trustee in its exercise of any trust or power. The Trustee
may withhold from Noteholders notice of any continuing Default (except
a Default in payment of amounts specified in clause (1) or (2) above)
if it determines that withholding notice is in their interests.
16. Trustee Dealings with the Company.
Subject to certain limitations imposed by the TIA, the Trustee under the
Indenture, in its individual or any other capacity, may become the owner or
pledgee of Notes and may otherwise deal with and collect obligations owed to it
by the Company or its Affiliates and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee.
17. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the Company shall not
have any liability for any obligations of the Company under the Notes or the
Indenture or for any claim based on,
A-1-10
in respect of or by reason of such obligations or their creation. By accepting a
Note, each Noteholder waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the Notes.
18. Authentication.
This Note shall not be valid until an authorized signatory of the Trustee signs
the Trustee's Certificate of Authentication on the other side of this Note.
19. Abbreviations.
Customary abbreviations may be used in the name of a Noteholder or an assignee,
such as TEN COM (=tenants in common), TEN ENT (=tenants by the entireties), JT
TEN (=joint tenants with right of survivorship and not as tenants in common),
CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act).
20. GOVERNING LAW.
THE INDENTURE AND THIS NOTE WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
The Company will furnish to any Noteholder upon written request and
without charge a copy of the Indenture which has in it the text of this Note in
larger type.
A-1-11
ASSIGNMENT FORM CONVERSION NOTICE
To assign this Note, fill in the form below: To convert this Note into Common Stock of
the Company, check the box:
I or we assign and transfer this Note to
To convert only part of this Note, state the
______________________________________________ principal amount to be converted (which
______________________________________________ must be $1,000 or an integral multiple of
$1,000):
(Insert assignee's social security or tax ID
no.) $_____________________
______________________________________________ If you want the stock certificate made out in
another person's name, fill in the form
______________________________________________ below:
______________________________________________
______________________________________________ ______________________________________________
(Print or type assignee's name, address and (Insert other person's social security or tax
zip code) ID no.)
and irrevocably appoint ______________________________________________
_____________________ agent to transfer ______________________________________________
this Note on the books of the Company. The
agent may substitute another to act for him. ______________________________________________
______________________________________________
(Print or type other person's name, address
and zip code)
________________________________________________________________________________
Date: _____________________ Your Signature: ___________________________________
________________________________________________________________________________
(Sign exactly as your name appears on the other side of this Note)
SIGNATURE GUARANTEE
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-1-12
EXHIBIT A-2
[Form of Face of Certificated Note]
THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE, THE
SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE NOR ANY INTEREST OR
PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION
OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER,
SELL, OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH SIERRA PACIFIC RESOURCES
(THE "COMPANY") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR
ANY PREDECESSOR OF SUCH NOTE) ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF,
(B) FOR SO LONG AS THIS NOTE AND THE SHARES OF COMMON STOCK ISSUABLE UPON
CONVERSION OF THIS NOTE ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO AN EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT, IF AVAILABLE,
(D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT AND CONTINUES TO BE EFFECTIVE AT THE TIME OF TRANSFER OR (E)
IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE
SECURITIES ACT IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSES (C) OR (E) ABOVE,
SUCH TRANSFER IS SUBJECT TO THE COMPANY'S AND THE TRUSTEE'S RIGHTS PRIOR TO ANY
SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO THE COMPANY, AND IN EACH
OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE
OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE. THE HOLDER AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE
SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN PURSUANT TO CLAUSE D ABOVE)
A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
A-2-1
[THE FOREGOING LEGEND MAY BE REMOVED FROM THIS NOTE ON SATISFACTION OF
THE CONDITIONS SPECIFIED IN THE INDENTURE.]
A-2-2
SIERRA PACIFIC RESOURCES
7.25% Convertible Notes due 2010
No.: CUSIP:
Issue Date:
SIERRA PACIFIC RESOURCES, a Nevada corporation (the "Company"),
promises to pay to Cede & Co. or registered assigns, the principal sum of
___________ DOLLARS ($___________) on February 14, 2010.
This Note shall bear interest as specified on the other side of this
Note. This Note is convertible as specified on the other side of this Note.
Additional provisions of this Note are set forth on the other side of
this Note.
Dated:
SIERRA PACIFIC RESOURCES
By__________________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK,
as Trustee, certifies that this
is one of the Notes referred
to in the within-mentioned Indenture (as
defined on the other side of this Note).
By_____________________________
Authorized Signatory
Dated: ________________________
A-2-3
EXHIBIT B-1
Transfer Certificate
In connection with any transfer of any of the Notes within the period
prior to the expiration of the holding period applicable to the sales thereof
under Rule 144(k) under the Securities Act of 1933, as amended (the "Securities
Act") (or any successor provision), the undersigned registered owner of this
Note hereby certifies with respect to $____________ principal amount of the
above-captioned Notes presented or surrendered on the date hereof (the
"Surrendered Notes") for registration of transfer, or for exchange or conversion
where the Notes issuable upon such exchange or conversion are to be registered
in a name other than that of the undersigned registered owner (each such
transaction being a "transfer"), that such transfer complies with the
restrictive legend set forth on the face of the Surrendered Notes for the reason
checked below:
- A transfer of the Surrendered Notes is made to the Company or
any subsidiaries; or
- The transfer of the Surrendered Notes complies with Rule 144A
under the U.S. Securities Act of 1933, as amended (the
"Securities Act"); or
- The transfer of the Surrendered Notes is to an institutional
accredited investor, as described in Rule 501(a)(1), (2), (3)
or (7) of Regulation D under the Securities Act; or
- The transfer of the Surrendered Notes is pursuant to an
effective registration statement under the Securities Act, or
- The transfer of the Surrendered Notes is pursuant to an
offshore transaction in accordance with Rule 904 of Regulation
S under the Securities Act; or
- The transfer of the Surrendered Notes is pursuant to another
available exemption from the registration requirement of the
Securities Act.
and unless the box below is checked, the undersigned confirms that, to the
undersigned's knowledge, such Notes are not being transferred to an "affiliate"
of the Company as defined in Rule 144 under the Securities Act (an "Affiliate").
- The transferee is an Affiliate of the Company.
DATE: ______________________________ __________________________________
Signature(s)
(If the registered owner is a corporation, partnership, or fiduciary, the title
of the Person signing on behalf of such registered owner must be stated.)
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EXHIBIT B-2
Form of Letter to Be Delivered by Accredited Investors
Sierra Pacific Resources
6100 Neil Road
Reno, Nevada 89520-0400
Attention: Vice President and Chief Financial Officer
The Bank of New York
101 Barclay Street, 8W
New York, NY 10286
Attention: Corporate Trust Division
Telephone No. (212) 815-5845
Facsimile No. (212) 815-5707
Dear Sirs:
We are delivering this letter in connection with the proposed
transfer of $_____________ principal amount of the 7.25% Convertible
Notes due 2010 (the "Notes") of Sierra Pacific Resources (the
"Company"), which are convertible into shares of the Company's Common
Stock, $1.00 par value per share (the "Common Stock").
We hereby confirm that:
(i) we are an "accredited investor" within the meaning of
Rule 501(a)(1), (2) or (3) under the Securities Act of 1933, as amended
(the "Securities Act"), or an entity in which all of the equity owners
are accredited investors within the meaning of Rule 501(a)(1), (2) or
(3) under the Securities Act (an "Institutional Accredited Investor");
(ii) the purchase of Notes by us is for our own account or
for the account of one or more other Institutional Accredited Investors
or as fiduciary for the account of one or more trusts, each of which is
an "accredited investor" within the meaning of Rule 501(a)(7) under the
Securities Act and for each of which we exercise sole investment
discretion or (B) we are a "bank," within the meaning of Section
3(a)(2) of the Securities Act, or a "savings and loan association" or
other institution described in Section 3(a)(5)(A) of the Securities Act
that is acquiring Notes fiduciary for the account of one or more
institutions for which we exercise sole investment discretion;
(iii) we have such knowledge and experience in financial
and business matters that we are capable of evaluating the merits and
risks of purchasing Notes; and
(iv) we are not acquiring Notes with a view to
distribution thereof or with any present intention of offering or
selling Notes or the Common Stock issuable upon conversion thereof,
except as permitted below; provided that the disposition of our
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property and property of any accounts for which we are acting as
fiduciary shall remain at all times within our control.
We understand that the Notes were originally offered and sold
in a transaction not involving any public offering within the United
States within the meaning of the Securities Act and that the Notes and
the shares of Common Stock (the "Notes") issuable upon conversion
thereof have not been registered under the Securities Act, and we
agree, on our own behalf and on behalf of each account for which we
acquire any Notes, that if in the future we decide to resell or
otherwise transfer such Notes prior to the date (the "Resale
Restriction Termination Date") which is two years after the later of
the original issuance of the Notes and the last date on which the
Company or an affiliate of the Company was the owner of the Note, such
Notes may be resold or otherwise transferred only (i) to the Company or
any subsidiary thereof, or (ii) for as long as the Notes are eligible
for resale pursuant to Rule 144A, to a person it reasonably believes is
a "qualified institutional buyer" (as defined in Rule 144A under the
Securities Act) that purchases for its own account or for the account
of a qualified institutional buyer to which notice is given that the
transfer is being made in reliance on Rule 144A, or (iii) to an
Institutional Accredited Investor that is acquiring the Note for its
own account, or for the account of such Institutional Accredited
Investor for investment purposes and not with a view to, or for offer
or sale in connection with, any distribution in violation of the
Securities Act, or (iv) pursuant to another available exemption from
registration under the Securities Act (if applicable), or (v) pursuant
to a registration statement which has been declared effective under the
Securities Act and, in each case, in accordance with any applicable
securities laws of any State of the United States or any other
applicable jurisdiction and in accordance with the legends set forth on
the Notes. We further agree to provide any person purchasing any of the
Notes other than pursuant to clause (v) above from us a notice advising
such purchaser that resales of such Notes are restricted as stated
herein. We understand that the trustee or the registrar, as the case
may be, for the Notes will not be required to accept for registration
of transfer any Notes pursuant to (iii) or (iv) above except upon
presentation of evidence satisfactory to the Company that the foregoing
restrictions on transfer have been complied with. We further understand
that any Notes will be in the form of definitive physical certificates
and that such certificates will bear a legend reflecting the substance
of this paragraph other than certificates representing Notes
transferred pursuant to clause (v) above.
We acknowledge that the Company, others and you will rely upon our
confirmations, acknowledgments and agreements set forth herein, and we
agree to notify you promptly in writing if any of our representations
or warranties herein ceases to be accurate and complete.
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THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK.
___________________________________________
(Name of Purchaser)
By:________________________________________
Name:
Title:
Address:
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