EXHIBIT 4.1
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WEBMD CORPORATION
and
The Bank of New York
as Trustee
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INDENTURE
Dated as of April 1, 2002
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$300,000,000 Principal Amount
(Plus Over-allotment Option)
3 1/4% CONVERTIBLE SUBORDINATED NOTES DUE 2007
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CROSS-REFERENCE TABLE
TIA Indenture
Section Section
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310(a)(1)........................................................................ 7.10
(a)(2)..................................................................... 7.10
(a)(3)..................................................................... N.A.
(a)(4)..................................................................... N.A.
(b)........................................................................ 7.08; 7.10; 12.02
(c)........................................................................ N.A.
311(a)........................................................................... 7.11
(b)........................................................................ 7.11
(c)........................................................................ N.A.
312(a)........................................................................... 2.05
(b)........................................................................ 12.03
(c)........................................................................ 12.03
313(a)........................................................................... 7.06
(b)(1)..................................................................... N.A.
(b)(2)..................................................................... 7.06
(c)........................................................................ 7.06; 12.02
(d)........................................................................ 7.06
314(a)........................................................................... 4.02
(b)........................................................................ N.A.
(c)(1)..................................................................... 12.04
(c)(2)..................................................................... 12.04
(c)(3)..................................................................... N.A.
(d)........................................................................ N.A.
(e)........................................................................ 12.05
(f)........................................................................ N.A.
315(a)........................................................................... 7.01(B)
(b)........................................................................ 7.05; 12.02
(c)........................................................................ 7.01(A)
(d)........................................................................ 7.01(C)
(e)........................................................................ 6.11
316(a)(last sentence)............................................................ 2.09
(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)........................................................................... 12.01
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TABLE OF CONTENTS
Page
I. DEFINITIONS AND INCORPORATION BY REFERENCE
1.01 Definitions.....................................................................................1
1.02 Other Definitions...............................................................................4
1.03 Incorporation by Reference of Trust Indenture Act...............................................5
1.04 Rules of Construction...........................................................................5
II. THE SECURITIES
2.01 Form and Dating.................................................................................6
2.02 Execution and Authentication....................................................................6
2.03 Registrar, Paying Agent and Conversion Agent....................................................7
2.04 Paying Agent To Hold Money in Trust.............................................................8
2.05 Securityholder Lists............................................................................8
2.06 Transfer and Exchange...........................................................................8
2.07 Replacement Securities..........................................................................9
2.08 Outstanding Securities..........................................................................9
2.09 Securities Held by the Company or an Affiliate..................................................9
2.10 Temporary Securities...........................................................................10
2.11 Cancellation...................................................................................10
2.12 Defaulted Interest.............................................................................10
2.13 CUSIP Numbers..................................................................................10
2.14 Deposit of Moneys..............................................................................10
2.15 Book-Entry Provisions for Global Securities....................................................11
2.16 Special Transfer Provisions....................................................................11
2.17 Restrictive Legends............................................................................14
2.18 Calculation of Original Issue Discount.........................................................14
III. REDEMPTION
3.01 Right of Redemption............................................................................14
3.02 Notices to Trustee.............................................................................14
3.03 Selection of Securities to Be Redeemed.........................................................15
3.04 Notice of Redemption...........................................................................15
3.05 Effect of Notice of Redemption.................................................................16
3.06 Deposit of Redemption Price....................................................................16
3.07 Securities Redeemed in Part....................................................................16
3.08 Repurchase at Option of Holder upon a Change in Control........................................17
3.09 Conversion Arrangement on Call for Redemption..................................................20
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IV. COVENANTS
4.01 Payment of Securities..........................................................................21
4.02 Maintenance of Office or Agency................................................................21
4.03 Reports........................................................................................21
4.04 Compliance Certificate.........................................................................22
4.05 Stay, Extension and Usury Laws.................................................................22
4.06 Corporate Existence............................................................................22
4.07 Notice of Default..............................................................................22
V. SUCCESSORS
5.01 When Company May Merge, etc....................................................................23
5.02 Successor Substituted..........................................................................23
VI. DEFAULTS AND REMEDIES
6.01 Events of Default..............................................................................23
6.02 Acceleration...................................................................................25
6.03 Other Remedies.................................................................................25
6.04 Waiver of Past Defaults........................................................................25
6.05 Control by Majority............................................................................26
6.06 Limitation on Suits............................................................................26
6.07 Rights of Holders to Receive Payment...........................................................26
6.08 Collection Suit by Trustee.....................................................................27
6.09 Trustee May File Proofs of Claim...............................................................27
6.10 Priorities.....................................................................................27
6.11 Undertaking for Costs..........................................................................28
VII. TRUSTEE
7.01 Duties of Trustee..............................................................................28
7.02 Rights of Trustee..............................................................................29
7.03 Individual Rights of Trustee...................................................................30
7.04 Trustee's Disclaimer...........................................................................30
7.05 Notice of Defaults.............................................................................30
7.06 Reports by Trustee to Holders..................................................................30
7.07 Compensation and Indemnity.....................................................................31
7.08 Replacement of Trustee.........................................................................31
7.09 Successor Trustee by Merger, etc...............................................................32
7.10 Eligibility; Disqualification..................................................................32
7.11 Preferential Collection of Claims Against Company..............................................32
VIII. DISCHARGE OF INDENTURE
8.01 Termination of the Obligations of the Company..................................................33
8.02 Application of Trust Money.....................................................................34
8.03 Repayment to Company...........................................................................34
8.04 Reinstatement..................................................................................34
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IX. AMENDMENTS
9.01 Without Consent of Holders.....................................................................34
9.02 With Consent of Holders........................................................................35
9.03 Compliance with Trust Indenture Act............................................................36
9.04 Revocation and Effect of Consents..............................................................36
9.05 Notation on or Exchange of Securities..........................................................36
9.06 Trustee Protected..............................................................................37
X. CONVERSION
10.01 Conversion Privilege; Restrictive Legends.....................................................37
10.02 Conversion Procedure..........................................................................37
10.03 Fractional Shares.............................................................................38
10.04 Taxes on Conversion...........................................................................38
10.05 Company to Provide Stock......................................................................38
10.06 Adjustment of Conversion Rate.................................................................39
10.07 No Adjustment.................................................................................44
10.08 Other Adjustments.............................................................................45
10.09 Adjustments for Tax Purposes..................................................................45
10.10 Notice of Adjustment..........................................................................45
10.11 Notice of Certain Transactions................................................................45
10.12 Effect of Reclassifications, Consolidations, Mergers, Binding Share Exchanges
or Sales on Conversion Privilege..............................................................46
10.13 Trustee's Disclaimer..........................................................................46
XI. SUBORDINATION
11.01 Agreement to Subordinate......................................................................47
11.02 Certain Definitions...........................................................................47
11.03 Liquidation; Dissolution; Bankruptcy..........................................................48
11.04 Company Not To Make Payments with Respect to Securities in Certain Circumstances..............48
11.05 Acceleration of Securities....................................................................49
11.06 When Distribution Must Be Paid Over...........................................................49
11.07 Notice by Company.............................................................................49
11.08 Subrogation...................................................................................49
11.09 Relative Rights...............................................................................50
11.10 Subordination May Not Be Impaired by Company..................................................50
11.11 Distribution or Notice to Representative......................................................50
11.12 Rights of Trustee and Paying Agent............................................................51
11.13 Officers' Certificate.........................................................................51
11.14 Not to Prevent Events of Default..............................................................51
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XII. MISCELLANEOUS
12.01 Trust Indenture Act Controls..................................................................52
12.02 Notices.......................................................................................52
12.03 Communication by Holders with Other Holders...................................................53
12.04 Certificate and Opinion as to Conditions Precedent............................................53
12.05 Statements Required in Certificate or Opinion.................................................53
12.06 Rules by Trustee and Agents...................................................................53
12.07 Legal Holidays................................................................................54
12.08 No Recourse Against Others....................................................................54
12.09 Duplicate Originals...........................................................................54
12.10 Governing Law.................................................................................54
12.11 No Adverse Interpretation of Other Agreements.................................................54
12.12 Successors....................................................................................54
12.13 Separability..................................................................................54
12.14 Table of Contents, Headings, etc..............................................................55
Exhibit A - Form of Global Security
Exhibit B - Form of Legends
Exhibit C - Form of Transfer Certificate - Regulation S [Not Used]
Exhibit D - Form of Transfer Certificate - Registration Statement
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INDENTURE, dated as of April 1, 2002 between WEBMD CORPORATION, a
Delaware corporation (the "COMPANY"), and The Bank of New York, as trustee (the
"TRUSTEE").
Each party agrees as follows for the benefit of the other parties and
for the equal and ratable benefit of the Holders of the Company's 3 1/4%
Convertible Subordinated Notes due 2007 (the "SECURITIES").
I. DEFINITIONS AND INCORPORATION BY REFERENCE
1.01 DEFINITIONS.
"AFFILIATE" means any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company. For
this purpose, "control" shall mean the power to direct the management and
policies of a person through the ownership of securities, by contract or
otherwise.
"AGENT" means any Registrar, Paying Agent, Conversion Agent or
co-registrar.
"BOARD OF DIRECTORS" means the Board of Directors of the Company or any
committee thereof authorized to act for it hereunder.
"BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
its Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"CAPITAL STOCK" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of the Company and all
warrants or options to acquire such capital stock.
"COMMON STOCK" means the common stock, par value $0.0001 per share, of
the Company, or such other capital stock into which the Company's common stock
is reclassified or changed.
"COMPANY" means the party named as such above until a successor
replaces it pursuant to the applicable provision hereof and thereafter means the
successor.
"COMPANY REQUEST" or "COMPANY ORDER" means a written request or order
signed on behalf of the Company by its Chairman of the Board, its Chief
Executive Officer, its President, its Chief Operating Officer, its Chief
Financial Officer, any Executive Vice President or any Vice President and by its
Treasurer or an Assistant Treasurer or its Secretary or an Assistant Secretary,
and delivered to the Trustee.
"CORPORATE TRUST OFFICE OF THE TRUSTEE" shall be at the address of the
Trustee specified in SECTION 12.02 or such other address as the Trustee may give
notice of to the Company.
"DAILY MARKET PRICE" means the price of a share of Common Stock on the
relevant date, determined (a) on the basis of the last reported sale price
regular way of the Common Stock as
reported on the Nasdaq National Market (the "NNM"), or if the Common Stock is
not then listed on the NNM, as reported on such national securities exchange
upon which the Common Stock is listed, or (b) if there is no such reported sale
on the day in question, on the basis of the average of the closing bid and asked
quotations regular way as so reported, or (c) if the Common Stock is not listed
on the NNM or on any national securities exchange or automated quotation system,
on the basis of the average of the high bid and low asked quotations regular way
on the day in question in the over-the-counter market as reported by the
National Association of Securities Dealers Automated Quotation System, or if not
so quoted, as reported by National Quotation Bureau, Incorporated, or a similar
organization.
"DEFAULT" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"DEPOSITARY" means The Depository Trust Company, its nominees and
successors.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"HOLDER" or "SECURITYHOLDER" means a person in whose name a Security is
registered on the Registrar's books.
"INDENTURE" means this Indenture as amended or supplemented from time
to time.
"INITIAL PURCHASER" means UBS Warburg LLC.
"INTEREST" includes liquidated damages, unless the context otherwise
requires.
"LIQUIDATED DAMAGES" has the meaning provided in the Registration
Rights Agreement.
"MATURITY DATE" means April 1, 2007.
"NON-RECOURSE INDEBTEDNESS" means Indebtedness upon the enforcement of
which recourse may be had by the holder(s) thereof only to identified assets of
the Company or any Subsidiary and not to the Company or any Subsidiary
personally.
"NON-U.S. PERSON" means a person who is not a U.S. person (as defined
in Regulation S pursuant to the Securities Act).
"OFFICER" means the Chairman of the Board, the Chief Executive Officer,
the President, the Chief Operating Officer, the Chief Financial Officer, any
Executive Vice President, any Vice President, the Treasurer or the Secretary of
the Company.
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers or
by an Officer and an Assistant Treasurer or an Assistant Secretary of the
Company.
"OPINION OF COUNSEL" means a written opinion from legal counsel who may
be an employee of or counsel for the Company, or other counsel reasonably
acceptable to the Trustee.
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"PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof.
"PURCHASE AGREEMENT" means the Purchase Agreement dated as of March 25,
2002 between the Company and the Initial Purchaser.
"QIB" means a "qualified institutional buyer" within the meaning of
Rule 144A under the Act.
"REDEMPTION PRICE" means, with respect to a Security to be redeemed by
the Company in accordance with ARTICLE III, the percentage of the outstanding
principal amount of such Security payable by the Company upon such redemption.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement
dated as of April 1, 2002 between the Company and the Initial Purchaser.
"REGULATION S" means Regulation S under the Securities Act.
"REGULATION S GLOBAL SECURITY" means a permanent Global Security in
registered form representing the aggregate principal amount of Securities sold
in reliance on Regulation S.
"REPURCHASE PRICE" means, with respect to a Security duly tendered for
purchase by the Company in accordance with SECTION 3.08, 100% of the outstanding
principal amount of such Security so tendered.
"RESPONSIBLE OFFICER" shall mean, when used with respect to the
Trustee, any officer within the corporate trust department of the Trustee,
including any vice president, assistant vice president, assistant secretary,
assistant treasurer, trust officer or any other officer of the Trustee who
customarily performs functions similar to those performed by the Persons who at
the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such person's knowledge of and familiarity with
the particular subject and who shall have direct responsibility for the
administration of this Indenture.
"RESTRICTED SECURITY" means a Security that constitutes a "restricted
security" within the meaning of Rule 144(a)(3) under the Securities Act;
provided, however, that the Trustee shall be entitled to request and
conclusively rely on an Opinion of Counsel with respect to whether any Security
constitutes a Restricted Security.
"RULE 144A" means Rule 144A under the Securities Act.
"RULE 144A GLOBAL SECURITY" means a permanent Global Security in
registered form representing the aggregate principal amount of Securities sold
in reliance on Rule 144A.
"SEC" means the Securities and Exchange Commission.
"SECURITIES" means the 3 1/4% Convertible Subordinated Notes due 2007
issued by the Company pursuant to this Indenture.
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"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITYHOLDER" has the meaning given to such term in the Registration
Rights Agreement.
"SIGNIFICANT SUBSIDIARY" with respect to any person means any
subsidiary of such person that constitutes a "significant subsidiary" within the
meaning of Rule 1-02 of Regulation S-X under the Securities Act, as such
regulation is in effect on the date of this Indenture.
"SUBSIDIARY" means (i) a corporation a majority of whose capital stock
with voting power, under ordinary circumstances, to elect directors is at the
time, directly or indirectly, owned by the Company, by one or more subsidiaries
of the Company or by the Company and one or more of its subsidiaries or (ii) any
other person (other than a corporation) in which the Company, one or more its
subsidiaries or the Company and one or more its subsidiaries, directly or
indirectly, at the date of determination thereof, have at least majority
ownership interest.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code ss.ss.
77aaa-77bbbb) as in effect on the date of this Indenture, except as provided in
SECTION 9.03.
"TRUSTEE" means the party named as such in this Indenture until a
successor replaces it in accordance with the provisions hereof and thereafter
means the successor.
1.02 OTHER DEFINITIONS.
Term Defined in Section
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"ADDITIONAL SECURITIES"....................................... 2.01
"BANKRUPTCY LAW".............................................. 6.01
"BUSINESS DAY"................................................ 12.07
"CHANGE IN CONTROL"........................................... 3.08
"CHANGE IN CONTROL NOTICE".................................... 3.08
"COMMENCEMENT DATE"........................................... 10.06
"CONVERSION AGENT"............................................ 2.03
"CUSTODIAN"................................................... 6.01
"DETERMINATION DATE".......................................... 10.06
"EVENT OF DEFAULT"............................................ 6.01
"GLOBAL SECURITY"............................................. 2.01
"INDEBTEDNESS"................................................ 11.02
"LEGAL HOLIDAY"............................................... 12.07
"NNM"......................................................... 1.01
"PARTICIPANTS"................................................ 2.15
"PAYING AGENT"................................................ 2.03
"PAYMENT BLOCKAGE"............................................ 11.04
"PAYMENT BLOCKAGE NOTICE"..................................... 11.04
"PHYSICAL SECURITIES"......................................... 2.01
"PRIVATE PLACEMENT LEGEND".................................... 2.17
"REGISTRAR"................................................... 2.03
"REPRESENTATIVE".............................................. 11.02
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"REPURCHASE DATE"............................................. 3.08
"REPURCHASE RIGHT"............................................ 3.08
"SENIOR INDEBTEDNESS"......................................... 11.02
"U.S. GOVERNMENT OBLIGATIONS"................................. 8.01
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 Securities;
"INDENTURE SECURITY HOLDER" means a Securityholder or a Holder;
"INDENTURE TO BE QUALIFIED" means this Indenture;
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee; and
"OBLIGOR" on the indenture securities means the Company or any
successor.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
and not otherwise defined herein have the meanings so assigned to them.
1.04 RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally accepted accounting
principles in effect on the date hereof;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural and in the
plural include the singular;
(v) provisions apply to successive events and
transactions; and
(vi) "herein", "hereof" and other words of similar import
refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
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II. THE SECURITIES
2.01 FORM AND DATING.
The Securities and the Trustee's certificate of authentication shall be
substantially in the form set forth in EXHIBIT A, which is incorporated in and
forms a part of this Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rule or usage. Each Security shall
be dated the date of its authentication.
Securities offered and sold in reliance on Rule 144A or on Regulation S
under the Securities Act shall be issued initially in the form of one or more
Global Securities, substantially in the form set forth in EXHIBIT A (the "GLOBAL
SECURITY"), deposited with the Trustee, as custodian for the Depositary, duly
executed by the Company and authenticated by the Trustee as hereinafter provided
and bearing the legends set forth in EXHIBITS B-1 and B-2. The aggregate
principal amount of the Global Security may from time to time be increased or
decreased by adjustments made on the records of the Trustee, as custodian for
the Depositary, as hereinafter provided; provided, that in no event shall the
aggregate principal amount of the Global Security or Securities exceed
$300,000,000, or $345,000,000 if the Initial Purchaser elects to purchase
Additional Securities pursuant to the over-allotment option provided for in
SECTION 1 of the Purchase Agreement ("ADDITIONAL SECURITIES").
Securities issued in exchange for interests in a Global Security
pursuant to SECTION 2.15 may be issued in the form of permanent certificated
Securities in registered form in substantially the form set forth in EXHIBIT A
(the "PHYSICAL SECURITIES") and, if applicable, bearing any legends required by
SECTION 2.17.
All Notes offered and sold in reliance on Regulation S shall remain in
the form of a Global Security for at least one year after the issue date for the
Securities. Notwithstanding the foregoing, in the event that Physical Securities
are issued in respect of beneficial interests in a Regulation S Global Security
at any time prior to one year after the date of this Indenture (other than in a
transaction subject to Rule 144A) the Company shall, as promptly as practicable,
institute procedures, including appropriate certifications reasonably designed
to ensure that any transfer of such Physical Securities prior to the end of such
one year is made only in accordance with Regulation S, pursuant to a
registration statement under the Securities Act or pursuant to an exemption from
registration under the Securities Act.
2.02 EXECUTION AND AUTHENTICATION.
One Officer shall sign the Securities for the Company by manual or
facsimile signature.
If an Officer whose signature is on a Security no longer holds that
office at the time the Security is authenticated, the Security shall
nevertheless be valid.
A Security shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
Security has been authenticated under this Indenture.
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Upon a written order of the Company signed by one Officer of the
Company, the Trustee shall authenticate Securities for original issue in the
aggregate principal amount of $300,000,000 and such additional principal amount,
if any, as shall be determined pursuant to the next sentence of this SECTION
2.02. Upon receipt by the Trustee of an Officers' Certificate stating that the
Initial Purchaser has elected to purchase from the Company a specified principal
amount of Additional Securities, not to exceed $45,000,000, pursuant to Section
l of the Purchase Agreement, the Trustee shall authenticate and deliver such
specified principal amount of Additional Securities to or upon the written order
of the Company signed as provided in the immediately preceding sentence. Such
Officers' Certificate must be received by the Trustee not later than the
proposed date for delivery of such Additional Securities. The aggregate
principal amount of Securities outstanding at any time may not exceed
$345,000,000 except as provided in SECTION 2.07.
Upon a written order of the Company signed by two Officers or by an
Officer and an Assistant Treasurer of the Company, the Trustee shall
authenticate Securities not bearing the Private Placement Legend to be issued to
the transferee when sold pursuant to an effective registration statement under
the Securities Act as set forth in SECTION 2.16(D).
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. An authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such Agent. An
authenticating agent has the same rights as an Agent to deal with the Company
and its Affiliates.
If a written order of the Company pursuant to this Section 2.02 of the
Indenture has been, or simultaneously is, delivered, any instructions by the
Company to the Trustee with respect to endorsement, delivery or redelivery of a
Security issued in global form shall be in writing but need not comply with
Section 12.04 hereof and need not be accompanied by an Opinion of Counsel.
The Securities shall be issuable only in registered form without
interest coupons and only in denominations of $1,000 principal amount and any
positive integral multiple thereof.
2.03 REGISTRAR, PAYING AGENT AND CONVERSION AGENT.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange ("REGISTRAR"), an office
or agency where Securities may be presented for payment ("PAYING AGENT") and an
office or agency where Securities may be presented for conversion ("CONVERSION
AGENT"). The Registrar shall keep a register of the Securities and of their
transfer and exchange. The Company may appoint or change one or more
co-registrars, one or more additional paying agents and one or more additional
conversion agents without notice and may act in any such capacity on its own
behalf. The term "Registrar" includes any co-registrar; the term "PAYING AGENT"
includes any additional paying agent; and the term "CONVERSION AGENT" includes
any additional conversion agent.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that
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relate to such Agent. The Company shall notify the Trustee of the name and
address of any Agent not a party to this Indenture. If the Company fails to
maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act as
such.
The Company initially appoints the Trustee as Paying Agent, Registrar
and Conversion Agent.
2.04 PAYING AGENT TO HOLD MONEY IN TRUST.
Each Paying Agent shall hold in trust for the benefit of the
Securityholders or the Trustee all moneys held by the Paying Agent for the
payment of the Securities, and shall notify the Trustee of any default by the
Company in making any such payment. While any such default continues, the
Trustee may require a Paying Agent to pay all money held by it to the Trustee.
The Company at any time may require a Paying Agent to pay all money held by it
to the Trustee. Upon payment over to the Trustee, the Paying Agent shall have no
further liability for the money. If the Company acts as Paying Agent, it shall
segregate and hold as a separate trust fund all money held by it as Paying
Agent.
2.05 SECURITYHOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee on or before each interest payment date 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
Securityholders.
2.06 TRANSFER AND EXCHANGE.
Subject to SECTIONS 2.15 and 2.16 hereof, where Securities are
presented to the Registrar with a request to register their transfer or to
exchange them for an equal principal amount of Securities of other authorized
denominations, the Registrar shall register the transfer or make the exchange if
its requirements for such transaction are met. To permit registrations of
transfer and exchanges, the Trustee shall authenticate Securities at the
Registrar's request. The Company or the Trustee, as the case may be, shall not
be required (a) to issue, authenticate, register the transfer of or exchange any
Security during a period beginning at the opening of business 15 days before the
mailing of a notice of redemption of the Securities selected for redemption
under SECTION 3.04 and ending at the close of business on the day of such
mailing or (b) to register the transfer of or exchange any Security so selected
for redemption or repurchase in whole or in part, except the unredeemed or
unrepurchased portion of Securities being redeemed or repurchased in part.
No service charge shall be made for any transfer, exchange or
conversion of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer, exchange or conversion of Securities, other than
exchanges pursuant to SECTIONS 2.10, 3.07, 3.08, 9.05 or 10.02 not involving any
transfer.
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2.07 REPLACEMENT SECURITIES.
If the Holder of a Security claims that the Security has been
mutilated, lost, destroyed or wrongfully taken, the Company shall issue and the
Trustee shall authenticate a replacement Security if the Trustee's requirements
are met and, in the case of a mutilated Security, such mutilated Security is
surrendered to the Trustee. In the case of lost, destroyed or wrongfully taken
Securities, if required by the Trustee, an indemnity bond must be provided by
the Holder that is sufficient in the judgment of the Trustee to protect the
Company, the Trustee or any Agent from any loss which any of them may suffer if
a Security is replaced. The Trustee may charge for its expenses in replacing a
Security.
In case any such mutilated, lost, destroyed or wrongfully taken
Security has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Security, pay such Security when due.
Every replacement Security is an additional obligation of the Company
only as provided in SECTION 2.08.
2.08 OUTSTANDING SECURITIES.
Securities outstanding at any time are all the Securities authenticated
by the Trustee except for those converted, those cancelled by it, those
delivered to it for cancellation and those described in this SECTION 2.08 as not
outstanding. Except to the extent provided in SECTION 2.09, a Security does not
cease to be outstanding because the Company or one of its subsidiaries or
Affiliates holds the Security.
If a Security is replaced pursuant to SECTION 2.07, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it, or a court
holds, that the replaced Security is held by a protected purchaser.
If the Paying Agent (other than the Company) holds on a redemption
date, Repurchase Date or maturity date money sufficient to pay Securities
payable on that date, then on and after that date, such Securities shall be
deemed to be no longer outstanding and interest on them shall cease to accrue,
and such Security shall be deemed paid whether or not the Security is delivered
to the Paying Agent. Thereafter, all other rights of the Holders of such
Securities shall terminate with respect to such Securities, other than the right
to receive the redemption price, Repurchase Price or principal amount, as
applicable.
2.09 SECURITIES HELD BY THE COMPANY OR AN AFFILIATE.
In determining whether the Holders of the required aggregate principal
amount of Securities have concurred in any direction, waiver or consent,
Securities owned by the Company or any of its subsidiaries or an Affiliate shall
be considered as though not outstanding, except that for the purposes of
determining whether a Responsible Officer of the Trustee shall be protected in
relying on any such direction, waiver or consent, only Securities which the
Trustee knows are so owned shall be so disregarded.
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2.10 TEMPORARY SECURITIES.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company considers appropriate for temporary Securities.
Without unreasonable delay, the Company shall prepare and the Trustee shall
authenticate definitive Securities in exchange for temporary Securities.
2.11 CANCELLATION.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar, Paying Agent and Conversion Agent shall forward to
the Trustee any Securities surrendered to them for transfer, exchange, payment
or conversion. The Trustee shall cancel all Securities surrendered for transfer,
exchange, payment, conversion or cancellation in accordance with its customary
procedures. The Company may not issue new Securities to replace Securities that
it has paid or delivered to the Trustee for cancellation or that any
Securityholder has converted pursuant to ARTICLE X.
2.12 DEFAULTED INTEREST.
If and to the extent the Company defaults in a payment of interest on
the Securities, the Company shall pay the defaulted interest in any lawful
manner plus, to the extent not prohibited by applicable statute or case law,
interest payable on the defaulted interest at the rate provided in the
Securities. The Company may pay the defaulted interest to the persons who are
Securityholders on a subsequent special record date. The Company shall fix such
record date and payment date. At least 15 days before the record date, the
Company shall mail to Securityholders a notice that states the record date,
payment date and amount of interest to be paid.
2.13 CUSIP NUMBERS.
The Company in issuing the Securities may use one or more "CUSIP"
numbers, and if so, the Trustee shall use the CUSIP numbers in notices of
redemption or exchange as a convenience to Holders; provided, however, that no
representation is hereby deemed to be made by the Trustee as to the correctness
or accuracy of the CUSIP numbers printed in the notice or on the Securities, and
that reliance may be placed only on the other identification numbers printed on
the Securities. The Company shall promptly notify the Trustee of any change in
the CUSIP numbers.
2.14 DEPOSIT OF MONEYS.
Prior to 11:00 A.M., New York City time, on each interest payment date,
maturity date, redemption date and Repurchase Date, the Company shall have
deposited with the Paying Agent in immediately available funds money sufficient
to make cash payments, if any, due on such interest payment date, maturity date,
redemption date and Repurchase Date, as the case may be, in a timely manner
which permits the Paying Agent to remit payment to the Holders on such interest
payment date, maturity date, redemption date and Repurchase Date, as the case
may be.
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2.15 BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITIES.
(A) The Global Securities initially shall (i) be registered in the
name of the Depositary or the nominee of such Depositary, (ii) be delivered to
the Trustee as custodian for such Depositary and (iii) bear legends as set forth
in SECTION 2.17.
Members of, or participants in, the Depositary ("PARTICIPANTS") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depositary, or the Trustee as its custodian, or under the
Global Security, and the Depositary may be treated by the Company, the Trustee
and any agent of the Company or the Trustee as the absolute owner of the Global
Security 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 impair, as between the Depositary
and Participants, the operation of customary practices governing the exercise of
the rights of a Holder of any Security.
(B) Transfers of Global Securities shall be limited to transfers
in whole, but not in part, to the Depositary, its successors or their respective
nominees. In addition, Physical Securities shall be transferred to all
beneficial owners in exchange for their beneficial interests in Global
Securities if (i) the Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for any Global Security and a successor
Depositary is not appointed by the Company within 90 days of such notice or (ii)
an Event of Default has occurred and is continuing and the Registrar has
received a written request from the Depositary to issue Physical Securities.
(C) In connection with the transfer of a Global Security in its
entirety to beneficial owners pursuant to SECTION 2.15(B), such Global Security
shall be deemed to be surrendered to the Trustee for cancellation, and the
Company shall execute, and the Trustee shall upon written instructions from the
Company authenticate and deliver, to each beneficial owner identified by the
Depositary in exchange for its beneficial interest in such Global Security, an
equal aggregate principal amount of Physical Securities of authorized
denominations.
(D) Any Physical Security constituting a Restricted Security
delivered in exchange for an interest in a Global Security pursuant to SECTION
2.15(B) shall, except as otherwise provided by SECTION 2.16, bear the Private
Placement Legend (as defined).
(E) The Holder of any Global Security may grant proxies and
otherwise authorize any Person, including Participants and Persons that may hold
interests through Participants, to take any action which a Holder is entitled to
take under this Indenture or the Securities.
2.16 SPECIAL TRANSFER PROVISIONS.
(A) TRANSFERS TO NON-U.S. PERSONS. The following provisions shall
apply with respect to the registration of any proposed transfer of a Restricted
Security to any Non-U.S. Person:
(i) the Registrar shall register the transfer of any
Restricted Security, whether or not such Security bears the Private
Placement Legend, if (x) the
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requested transfer is after the second anniversary of the issue date
for the Securities; provided, however, that neither the Company nor any
of its Affiliates has held any beneficial interest in such Security, or
portion thereof, at any time on or prior to the second anniversary of
the issue date for the Securities or (y) the proposed transferor has
delivered to the Registrar certificates substantially in the form of
EXHIBIT D-1 and EXHIBIT D-2 hereto; and
(ii) if the proposed transferor is a Participant seeking
to transfer an interest in one Global Security to a transferee who will
hold such interest in another Global Security, upon receipt by the
Registrar of (x) written instructions given in accordance with the
Depositary's and the Registrar's procedures and (y) the appropriate
certificates and other documents, if any, required by clause (y) of
paragraph (i) above, the Registrar shall register the transfer and
reflect on its books and records the date and (A) a decrease in the
aggregate principal amount of the Global Security through which the
transferor held such interest in an amount equal to the aggregate
principal amount of the Securities to be transferred and (B) an
increase in the aggregate principal amount of the Global Security
through which the transferee proposes to hold such interest, in an
amount equal to the aggregate principal amount of the Securities to be
transferred.
(B) TRANSFERS TO QIBS. The following provisions shall apply with
respect to the registration of any proposed transfer of a Restricted Security to
a QIB:
(i) the Registrar shall register the transfer of any
Restricted Security, whether or not such Security bears the Private
Placement Legend, if (x) the requested transfer is after the second
anniversary of the issue date for the Securities; provided, however,
that neither the Company nor any of its Affiliates has held any
beneficial interest in such Security, or portion thereof, at any time
on or prior to the second anniversary of the issue date for the
Securities or (y) such transfer is being made by a proposed transferor
who has checked the box provided for on the form of Security stating,
or has otherwise advised the Company and the Registrar in writing, that
the sale has been made in compliance with the provisions of Rule 144A
to a transferee who has signed the certification provided for on the
form of Security stating, or has otherwise advised the Company and the
Registrar in writing, that it is purchasing the Security for its own
account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a QIB within
the meaning of Rule 144A, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received
such information regarding the Company as it has requested pursuant to
Rule 144A or has determined not to request such information and that it
is aware that the transferor is relying upon its foregoing
representations in order to claim the exemption from registration
provided by Rule 144A; and
(ii) if the proposed transferor is a Participant seeking
to transfer an interest in one Global Security to a transferee who will
hold such interest in another Global Security, upon receipt by the
Registrar of (x) written instructions given in accordance with the
Depositary's and the Registrar's procedures and
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(y) the appropriate certificates and other documents, if any, required
by clause (y) of paragraph (i) above, the Registrar shall register the
transfer and reflect on its books and records the date and (A) a
decrease in the aggregate principal amount of the Global Security
through which the transferor held such interest in an amount equal to
the aggregate principal amount of the Securities to be transferred and
(B) an increase in the aggregate principal amount of the Global
Security through which the transferee proposes to hold such interest,
in an amount equal to the aggregate principal amount of the Securities
to be transferred.
(C) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL SECURITIES.
Notwithstanding any other provisions of this Indenture, a Global Security may
not be transferred except as a whole by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
(D) PRIVATE PLACEMENT LEGEND. Upon the transfer, exchange or
replacement of Securities not bearing the Private Placement Legend, the
Registrar or co-Registrar shall deliver Securities that do not bear the Private
Placement Legend. Upon the transfer, exchange or replacement of Securities
bearing the Private Placement Legend, the Registrar or co-Registrar shall
deliver only Securities that bear the Private Placement Legend unless (i) the
requested transfer is after the second anniversary of the issue date for the
Securities (provided, however, that neither the Company nor any of its
Affiliates has held any beneficial interest in such Security, or portion
thereof, at any time prior to or on the second anniversary of the issue date),
(ii) there is delivered to the Trustee an Opinion of Counsel reasonably
satisfactory to the Company to the effect that neither such legend nor the
related restrictions on transfer are required in order to maintain compliance
with the provisions of the Securities Act or (iii) such Security has been sold
pursuant to an effective registration statement under the Securities Act and the
Holder selling such Securities has delivered to the Registrar or co-Registrar a
notice in the form of EXHIBIT E hereto. Upon the effectiveness of the Shelf
Registration Statement (as defined in the Registration Rights Agreement), the
Company shall deliver to the Trustee a notice of effectiveness, a Security or
Securities, an authentication order in accordance with SECTION 2.02 and an
opinion of counsel in the form of EXHIBIT F hereto and, if required by the
Depositary, the Company shall deliver to the Depositary a letter of
representations in a form reasonably acceptable to the Depositary.
(E) GENERAL. By its acceptance of any Security bearing the Private
Placement Legend, each Holder of such a Security acknowledges the restrictions
on transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture.
The Registrar shall retain copies of all letters, notices and other
written communications received pursuant to SECTION 2.15 or this SECTION 2.16.
The Company shall have the right to inspect and make copies of all such letters,
notices or other written communications at any reasonable time upon the giving
of reasonable written notice to the Registrar.
(F) TRANSFERS OF SECURITIES HELD BY AFFILIATES. Any certificate
(i) evidencing a Security that has been transferred to an Affiliate of the
Company within two years after the issue
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date for the Securities, as evidenced by a notation on the Assignment Form for
such transfer or in the representation letter delivered in respect thereof or
(ii) evidencing a Security that has been acquired from an Affiliate (other than
by an Affiliate) in a transaction or a chain of transactions not involving any
public offering, shall, until two years after the last date on which the Company
or any Affiliate of the Company was an owner of such Security, in each case,
bear the Private Placement Legend, unless otherwise agreed by the Company (with
written notice thereof to the Trustee).
2.17 RESTRICTIVE LEGENDS.
Each Global Security and Physical Security that constitutes a
Restricted Security shall bear the legend (the "PRIVATE PLACEMENT LEGEND") as
set forth in EXHIBIT B-1 on the face thereof until after the second anniversary
of the later of (i) the issue date for the Securities, (ii) the last date on
which the Company or any Affiliate of the Company was the owner of such Security
(or any predecessor security) (or such shorter period of time as permitted by
Rule 144(k) under the Securities Act or any successor provision thereunder) (or
such longer period of time as may be required under the Securities Act or
applicable state securities laws in the opinion of counsel for the Company,
unless otherwise agreed between the Company and the Holder thereof).
Each Global Security shall also bear the legend as set forth in EXHIBIT
B-2.
2.18 CALCULATION OF ORIGINAL ISSUE DISCOUNT.
The Company shall file with the Trustee promptly at the end of each
calendar year (i) a written notice specifying the amount of original issue
discount (including daily rates and accrual periods) accrued on outstanding
Securities as of the end of such year and (ii) such other specific information
relating to such original issue discount as may then be relevant under the
Internal Revenue Code of 1986, as amended from time to time.
III. REDEMPTION
3.01 RIGHT OF REDEMPTION.
Redemption of the Securities, as permitted by any provision of this
Indenture, shall be made in accordance with PARAGRAPHS 6 AND 7 and, with respect
to any repurchase upon a Change in Control, PARAGRAPH 8 of the Securities, and
in each case in accordance with this ARTICLE III. The Company will not have the
right to redeem any Securities prior to April 5, 2005. On or after April 5,
2005, the Company will have the right to redeem all or any part of the
Securities at the Redemption Prices specified in Paragraph 6 therein under the
caption "Redemption Price," in each case including accrued and unpaid interest,
if any, to, but excluding, the redemption date.
3.02 NOTICES TO TRUSTEE.
If the Company elects to redeem Securities pursuant to PARAGRAPH 6 of
the Securities, it shall notify the Trustee at least 15 days prior to the
mailing of the notice of redemption (unless a
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shorter notice period shall be satisfactory to the Trustee) of the redemption
date and the aggregate principal amount of Securities to be redeemed.
3.03 SELECTION OF SECURITIES TO BE REDEEMED.
If less than all the Securities are to be redeemed, the Trustee shall
select the Securities to be redeemed on a pro rata basis. The Trustee shall make
the selection from Securities outstanding not previously called for redemption.
The Trustee may select for redemption portions of the principal of Securities
that have denominations larger than $1,000 principal amount. Securities and
portions of them it selects shall be in amounts of $1,000 principal amount or
positive integral multiples of $1,000 principal amount. The Trustee shall
promptly notify the Company in writing of the Securities selected for redemption
and the principal amount thereof to be redeemed.
The Registrar need not transfer or exchange any Securities selected for
redemption, except the unredeemed portion of the Securities redeemed in part.
Also, the Registrar need not transfer or exchange any Securities for a period of
15 days before selecting Securities to be redeemed.
3.04 NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a redemption date,
the Company shall mail by first-class mail a notice of redemption to each Holder
whose Securities are to be redeemed.
The notice shall identify the Securities and the aggregate principal
amount thereof to be redeemed and shall state:
(i) the redemption date;
(ii) the Redemption Price, plus the amount of accrued and
unpaid interest to be paid on the Securities called for redemption;
(iii) the then current conversion rate and conversion
price;
(iv) the name and address of the Paying Agent and
Conversion Agent;
(v) the date on which the right to convert the principal
of the Securities called for redemption will terminate and the place or
places where such Securities may be surrendered for conversion;
(vi) that Holders who want to convert Securities must
satisfy the requirements in ARTICLE X;
(vii) the paragraph of the Securities pursuant to which the
Securities are to be redeemed;
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(viii) that Securities called for redemption must be
surrendered to the Paying Agent to collect the Redemption Price;
(ix) that unless the Company shall default in the payment
of the Redemption Price, interest on Securities called for redemption
ceases to accrue on and after the redemption date and that the
Securities will cease to be convertible after the close of business on
the business day immediately preceding the redemption date; and
(x) the CUSIP number or numbers, as the case may be, of
the Securities.
The date on which the right to convert the principal of the Securities
called for redemption will terminate shall be at the close of business on the
business day immediately preceding the redemption date.
At the Company's request, upon reasonable prior notice, the Trustee
shall give the notice of redemption in the Company's name and at the Company's
expense; provided that the form and content of such notice shall be prepared by
the Company.
3.05 EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed, Securities called for redemption
become due and payable on the redemption date at the Redemption Price plus
accrued and unpaid interest to the date of redemption, and, on and after such
date (unless the Company shall default in the payment of the Redemption Price),
such Securities shall cease to bear interest. Upon surrender to the Paying
Agent, such Securities shall be paid at the Redemption Price plus accrued
interest to, but excluding, the redemption date, unless the redemption date is
an interest payment date, in which case the accrued interest will be paid in the
ordinary course.
3.06 DEPOSIT OF REDEMPTION PRICE.
On or before the redemption date, the Company shall deposit with the
Paying Agent money in funds immediately available on the redemption date
sufficient to pay the Redemption Price of and accrued interest on all Securities
to be redeemed on that date. The Paying Agent shall return to the Company, as
soon as practicable, any money not required for that purpose.
3.07 SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is redeemed in part, the Company
shall execute and the Trustee shall authenticate for the Holder a new Security
or Securities in an aggregate principal amount equal to the unredeemed portion
of the Security surrendered.
If any Security selected for partial redemption is converted in part,
the converted portion of such Security shall be deemed to be the portion
selected for redemption.
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3.08 REPURCHASE AT OPTION OF HOLDER UPON A CHANGE IN CONTROL.
Upon any Change in Control (as defined below) with respect to the
Company, each Holder of Securities shall have the right (the "REPURCHASE
RIGHT"), at the Holder's option, subject to the rights of the holders of Senior
Indebtedness under ARTICLE XI of this Indenture, to require the Company to
repurchase all of such Holder's Securities, or a portion thereof which is $1,000
in principal amount or any positive integral multiple thereof, on the date (the
"REPURCHASE DATE") that is 30 business days after the date of the Change in
Control Notice (as defined below) at the Repurchase Price set forth in PARAGRAPH
8 of the Securities, plus accrued and unpaid interest, if any, to, but
excluding, the Repurchase Date.
Within 30 business days after the occurrence of a Change in Control of
the Company, the Company shall mail to all Holders of record of the Securities a
notice (the "CHANGE IN CONTROL NOTICE") of the occurrence of such Change in
Control and the Repurchase Right arising as a result thereof. The Company shall
deliver a copy of the Change in Control Notice to the Trustee and shall cause a
copy to be published at the expense of the Company in THE NEW YORK TIMES or THE
WALL STREET JOURNAL or another newspaper of national circulation. To exercise
the Repurchase Right, a Holder of Securities must deliver on or before the close
of business on the third business day immediately preceding the Repurchase Date
written notice to the Company (or an agent designated by the Company for such
purpose), and the Trustee of the Holder's exercise of such right together with
the Securities with respect to which the right is being exercised, duly endorsed
for transfer.
Each Change in Control Notice shall state:
(i) the events causing the Change in Control;
(ii) the date of such Change in Control;
(iii) the Repurchase Date;
(iv) the date by which the Repurchase Right must be
exercised;
(v) the Repurchase Price, plus the amount of accrued
interest to be paid on the Securities to be repurchased;
(vi) the name and address of the Paying Agent and the
Conversion Agent;
(vii) a description of the procedure which a Holder must
follow to exercise a Repurchase Right;
(viii) that, in order to exercise the Repurchase Right, the
Securities are to be surrendered for payment of the Repurchase Price;
(ix) that Holders will be entitled to withdraw their
election if the Company (if acting as its own Paying Agent), or the
Paying Agent receives, not later than the close of business on the
business day immediately preceding the
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Repurchase Date, or such longer period as may be required by law, a
letter or telegram, telex or facsimile transmission (receipt of which
is confirmed and promptly followed by a letter) setting forth the name
of the Holder, the principal amount of Securities the Holder delivered
for purchase and a statement that such Holder is withdrawing his
election to have such Securities repurchased, the certificate numbers
of such Securities being withdrawn, if applicable, and the principal
amount, if any, of the Securities that remain subject to a Change in
Control Notice and that Securities with respect to which a Change in
Control purchase notice is given by the Holder may be converted, if
otherwise convertible, only if the Change in Control purchase notice
has been withdrawn in accordance with the terms hereof;
(x) the then existing conversion rate, and any adjustment
to the conversion rate that will result from the Change in Control;
(xi) the place or places where such Securities may be
surrendered for conversion; and
(xii) the CUSIP number or numbers, as the case may be, of
the Securities.
No failure of the Company to give the foregoing notice shall limit any
Holder's right to exercise a Repurchase Right.
To exercise a Repurchase Right, a Holder shall deliver to the Company
(if it is acting as its own Paying Agent), or to a Paying Agent designated by
the Company for such purpose in the Change in Control Notice within the period
set forth in the second paragraph of this SECTION 3.08, (i) the Option of Holder
To Elect Purchase Notice on the back of the Securities with respect to which the
Repurchase Right is being exercised, or any other form of written notice
substantially similar to the Option of Holder To Elect Purchase Notice, in each
case, duly completed and signed, with appropriate signature guarantee, and (ii)
such Securities with respect to which the Repurchase Right is being exercised,
duly endorsed for transfer to the Company and the Holder of such Securities
shall be entitled to receive from the Company (if it is acting as its own Paying
Agent), or such Paying Agent a nontransferable receipt of deposit evidencing
such deposit.
In the event a Repurchase Right shall be exercised in accordance with
the terms hereof, the Company shall pay or cause to be paid the applicable
Repurchase Price (plus accrued and unpaid interest) with respect to the
Securities as to which the Repurchase Right shall have been exercised to the
Holder on the Repurchase Date, subject to the provisions of the immediately
preceding paragraph.
On or prior to a Repurchase Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust in accordance with SECTION 2.04) an amount of
money (to be available on the Repurchase Date) sufficient to pay the Repurchase
Price (plus accrued and unpaid interest) of all of the Securities which are to
be repurchased on that date.
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Both the Change in Control Notice and the notice of the Holder to
exercise a Repurchase Right having been duly given as specified in this SECTION
3.08, the Securities so to be repurchased shall, on the Repurchase Date, become
due and payable at the Repurchase Price applicable thereto (plus accrued and
unpaid interest) and from and after such date (unless there shall be a default
in the payment of the Repurchase Price) such Securities shall cease to bear
interest and shall cease to be convertible. Upon surrender of any such Security
for repurchase in accordance with said notice, such Security shall be paid by
the Company at the Repurchase Price (plus accrued and unpaid interest).
If any Security shall not be paid upon surrender thereof for
repurchase, the principal shall, until paid, bear interest from the Repurchase
Date at the rate borne by such Security on the principal amount of such Security
and shall continue to be convertible.
Any Security which is to be submitted for repurchase only in part shall
be delivered pursuant to this SECTION 3.08 (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 its attorney duly authorized in writing), and the Company shall execute, and
the Trustee shall authenticate and make available for delivery to the Holder of
such Security without service charge, a new Security or Securities, of any
authorized denomination as requested by such Holder, of the same tenor and in
aggregate principal amount equal to the portion of such Security not submitted
for repurchase.
Notwithstanding anything herein to the contrary, (i) if the option
granted to Securityholders to require the repurchase of the Securities upon the
occurrence of a Change in Control is determined to constitute a tender offer,
the Company will comply with all applicable tender offer rules under the
Exchange Act, including Rules 13e-4 and 14e-1, and file Schedule TO or any other
schedules required under the Exchange Act and (ii) the Company may not purchase
Securities at the option of Holders upon a Change in Control if there has
occurred and is continuing an Event of Default with respect to the Securities,
other than a Default in the payment of the Change in Control purchase price with
respect to the Securities.
As used in this SECTION 3.08 of the Indenture and in the Securities:
A "CHANGE IN CONTROL" of the Company shall be deemed to have occurred
at such time as:
(i) any "person" or "group" (as such terms are used for
purposes of Sections 13(d) and 14(d) of the Exchange Act), other than
the Company, any of its subsidiaries or any of their respective
employee benefit plans, is or becomes the "beneficial owner" (as such
term is used in Rule 13d-3 under the Exchange Act), directly or
indirectly, of 50% or more of the voting power of the Company's Common
Stock; or
(ii) the sale, lease or transfer of all or substantially
all of the assets of the Company to any "person" or "group" (as such
terms are used in Sections 13(d) and 14(d) of the Exchange Act).
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However, a Change in Control will not be deemed to have occurred if either:
(X) the last sale price of the Company's Common Stock for any five
trading days during the ten trading days immediately preceding
the Change in Control is at least equal to 105% of the then
effective conversion price on the date of the Change in
Control; or
(Y) in the case of a merger or consolidation, all or substantially
all of the consideration (excluding cash payments for
fractional shares and cash payments pursuant to dissenters'
appraisal rights) in the merger or consolidation constituting
the Change in Control consists of common stock traded on a
U.S. national securities exchange or quoted on the NNM (or
which will be so traded or quoted when issued or exchanged in
connection with such Change in Control) and as a result of
such transaction or transactions the Securities become
convertible solely into such common stock and any such other
consideration.
3.09 CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION.
In connection with any redemption of Securities, the Company may
arrange, in lieu of redemption, for the purchase and conversion of any
Securities called for redemption by an agreement with one or more investment
bankers or other purchasers to purchase all or a portion of such Securities by
paying to the Trustee in trust for the Holders whose Securities are to be so
purchased, on or before the close of business on the redemption date, an amount
that, together with any amounts deposited with the Trustee by the Company for
redemption of such Securities, is not less than the Redemption Price, together
with interest, if any, accrued to the redemption date, of such Securities.
Notwithstanding anything to the contrary contained in this ARTICLE III, the
obligation of the Company to pay the Redemption Price of such Securities,
including all accrued interest, if any, shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such purchasers, but no such
agreement shall relieve the Company of its obligation to pay such Redemption
Price and such accrued interest, if any. If such an agreement is entered into,
any Securities 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 X) 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 Securities 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
Securities. Without the Trustee's prior written consent, no arrangement between
the Company and such purchasers for the purchase and conversion of any
Securities shall increase or otherwise affect any of the powers, duties, rights,
immunities, 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 and all loss, liability or expense arising out of or in
connection with any such arrangement for the purchase and conversion of any
Securities between the Company and such purchasers, including the costs and
expenses (including counsel fees 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
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powers, duties, responsibilities or obligations under this Indenture except to
the extent arising from its bad faith, willful misconduct or negligence.
IV. COVENANTS
4.01 PAYMENT OF SECURITIES.
The Company shall pay all amounts due with respect to the Securities on
the dates and in the manner provided in the Securities. All such amounts shall
be considered paid on the date due if the Paying Agent holds (or, if the Company
is acting as Paying Agent, if the Company has segregated and holds in trust in
accordance with SECTION 2.04) on that date money sufficient to pay the amount
then due with respect to the Securities.
The Company shall pay interest on any overdue amount (including, to the
extent permitted by applicable law, overdue interest) at the rate borne by the
Securities.
4.02 MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-Registrar) where Securities may be surrendered
for registration of transfer or exchange or conversion and where notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York for such purposes. The Company will
give prompt written notice to the Trustee of any such designation or rescission
and of any change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee
as an agency of the Company in accordance with SECTION 2.03.
4.03 REPORTS.
(A) The Company will promptly provide to the Trustee and shall,
upon request, provide to any Holder or beneficial owner of Securities or
prospective purchaser of Securities that so requests, the information required
to be delivered pursuant to Rule 144A(d)(4) until such time as the Securities
and the underlying Common Stock have been registered by the Company for resale
under the Securities Act pursuant to the Registration Rights Agreement. In
addition, the Company will furnish such Rule 144A(d)(4) information if, at any
time while the Securities
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or the Common Stock issuable upon conversion of the Securities are restricted
securities within the meaning of the Securities Act, the Company is not subject
to the informational requirements of the Exchange Act.
(B) The Company will comply with the provisions of TIA ss. 314(a).
(C) Delivery of such reports, information and documents to the
Trustee is for informational purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on the Officers' Certificate).
4.04 COMPLIANCE CERTIFICATE.
The Company shall deliver to the Trustee within 90 days after the end
of each fiscal year of the Company an Officers' Certificate stating whether or
not the signers know of any Default or Event of Default by the Company in
performing any of its obligations under this Indenture or the Securities. If
they do know of any such Default or Event of Default, the certificate shall
describe the Default or Event of Default and its status.
4.05 STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (in each case, to the
extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not, by resort to any such
law, hinder, delay or impede the execution of any power herein granted to the
Trustee, but will suffer and permit the execution of every such power as though
no such law has been enacted.
4.06 CORPORATE EXISTENCE.
Subject to ARTICLE V, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its corporate
existence and the corporate existence of each of its Significant Subsidiaries in
accordance with the respective organizational documents of each Significant
Subsidiary and the rights (charter and statutory), licenses and franchises of
the Company and its Significant Subsidiaries; provided, however, that the
Company shall not be required to preserve any such right, license or franchise,
or the corporate existence of any Significant Subsidiary, if in the judgment of
the Board of Directors (i) such preservation or existence is not material to the
conduct of business of the Company and (ii) the loss of such right, license or
franchise or the dissolution of such Significant Subsidiary does not have a
material adverse impact on the Holders.
4.07 NOTICE OF DEFAULT.
In the event that any Default or Event of Default shall occur, the
Company will give prompt written notice of such Default or Event of Default to
the Trustee.
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V. SUCCESSORS
5.01 WHEN COMPANY MAY MERGE, ETC.
The Company shall not consolidate with or merge into, or transfer or
lease all or substantially all of its properties and assets to, another person
unless such other person is a corporation organized under the laws of the United
States, any State thereof or the District of Columbia or a corporation or
comparable legal entity organized under the laws of a foreign jurisdiction and
whose equity securities are listed on a national securities exchange in the
United States or authorized for quotation on the NNM prior to or upon giving
effect to the transaction (provided however, that in the case of a transaction
where the surviving entity is organized under the laws of a foreign
jurisdiction, the Company may not consummate the transaction without first (i)
making provision for the satisfaction of its obligations to repurchase the
Securities following a change in control, if any, and (ii) obtaining an opinion
of tax counsel experienced in such matters to the effect that, under then
existing United States federal income tax laws, there would be no material
adverse tax consequences to Holders of the Securities resulting from such
transaction); such person assumes by supplemental indenture all the obligations
of the Company, under the Securities and this Indenture; and immediately after
giving effect to the transaction, no Default or Event of Default shall exist.
The Company shall deliver to the Trustee prior to the consummation of
the proposed transaction an Officers' Certificate to the foregoing effect and an
Opinion of Counsel, which may rely upon such Officers' Certificate as to the
absence of Defaults and Events of Default, stating that the proposed transaction
and such supplemental indenture will, upon consummation of the proposed
transaction, comply with this Indenture.
5.02 SUCCESSOR SUBSTITUTED.
Upon any consolidation or merger or transfer or lease of all or
substantially all of the assets of the Company in accordance with SECTION 5.01,
the successor person formed by such consolidation or into which the Company is
merged or to which such transfer or lease is made shall succeed to, and, except
in the case of a lease, be substituted for, and may exercise every right and
power of, and shall assume every duty and obligation of, the Company under this
Indenture with the same effect as if such successor had been named as the
Company herein. When the successor assumes all obligations of the Company
hereunder, except in the case of a lease, all obligations of the predecessor
shall terminate.
VI. DEFAULTS AND REMEDIES
6.01 EVENTS OF DEFAULT.
An "EVENT OF DEFAULT" occurs if:
(i) the Company defaults in the payment of interest or
liquidated damages on any Security when the same becomes due and
payable and the default continues for a period of 30 days, whether or
not such payment shall be prohibited by the provisions of ARTICLE XI
hereof;
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(ii) the Company defaults in the payment of the principal
or Repurchase Price or Redemption Price of any Security when the same
becomes due and payable, whether on the Maturity Date, upon redemption,
on the Repurchase Date or otherwise, whether or not such payment shall
be prohibited by the provisions of ARTICLE XI hereof;
(iii) the Company fails to comply with any of its other
agreements in the Securities or this Indenture and the default
continues for the period and after the notice specified below;
(iv) the Company or any of its Significant Subsidiaries
defaults in the payment at the final maturity thereof, after the
expiration of any applicable grace period, of principal of, or premium,
if any, on indebtedness for money borrowed, other than Non-Recourse
Indebtedness, in the aggregate principal amount then outstanding of
$30,000,000 or more, or the acceleration of indebtedness for money
borrowed in such aggregate principal amount so that it becomes due and
payable prior to the date on which it would otherwise become due and
payable and such acceleration is not rescinded or such default is not
cured within 30 business days after notice to the Company in accordance
with this Indenture;
(v) the Company or any of its Significant Subsidiaries
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief against
it in an involuntary case,
(C) consents to the appointment of a Custodian of it or
for all or substantially all of its property, or
(D) makes a general assignment for the benefit of its
creditors; or
(vi) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any of its
Significant Subsidiaries 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 of its
Significant Subsidiaries for all or substantially all of the property
of the Company or any such Significant Subsidiary, as the case may be,
or
(C) orders the winding up or liquidation of the Company
or any of its Significant Subsidiaries,
and the order or decree remains unstayed and in effect for 90
consecutive days.
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The term "BANKRUPTCY LAW" means Title 11, U.S. Code or any similar
Federal or State law for the relief of debtors. The term "CUSTODIAN" means any
receiver, trustee, assignee, liquidator or similar official under any Bankruptcy
Law.
A default under CLAUSE (III) is not an Event of Default until the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Securities then outstanding notify the Company and the Trustee of the default
and the default is not cured within 60 days after receipt of the notice. The
notice must specify the default, demand that it be remedied and state that the
notice is a "NOTICE OF DEFAULT". If the Holders of 25% in aggregate principal
amount of the outstanding Securities request the Trustee to give such notice on
their behalf, the Trustee shall do so. When a default is cured, it ceases.
6.02 ACCELERATION.
If an Event of Default (other than an Event of Default specified in
SECTION 6.01(V) or (VI) with respect to the Company) as to which the Trustee has
received notice pursuant to the provisions of this Indenture occurs and is
continuing, the Trustee by notice to the Company or the Holders of at least 25%
in principal amount of the Securities then outstanding by notice to the Company
and the Trustee may declare the Securities to be due and payable. Upon such
declaration such principal and interest shall be due and payable immediately. If
an Event of Default specified in SECTION 6.01(V) or (VI) with respect to the
Company occurs, the principal of and accrued interest on all the Securities
shall ipso facto become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Securityholder. The
Holders of a majority in aggregate principal amount of the Securities then
outstanding by written notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any order or decree and
if all existing Events of Default have been cured or waived except nonpayment of
principal or interest that has become due solely because of the acceleration and
if all amounts due to the Trustee under SECTION 7.07 have been paid.
6.03 OTHER REMEDIES.
Notwithstanding any other provision of this Indenture, if an Event of
Default occurs and is continuing, the Trustee may pursue any available remedy by
proceeding at law or in equity to collect the payment of amounts due with
respect to the Securities or to enforce the performance of any provision of the
Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative.
6.04 WAIVER OF PAST DEFAULTS.
Subject to SECTIONS 6.07 and 9.02, the Holders of a majority in
aggregate principal amount of the Securities then outstanding by notice to the
Trustee may waive any past Default or Event of Default and its consequences.
When a Default or an Event of Default is waived, it is cured and ceases for
every purpose of this Indenture.
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6.05 CONTROL BY MAJORITY.
The Holders of a majority in aggregate principal amount of the
Securities then outstanding may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture, is unduly prejudicial to
the rights of other Securityholders or would involve the Trustee in personal
liability; provided that the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction.
6.06 LIMITATION ON SUITS.
Except as provided in SECTION 6.07, a Securityholder may pursue a
remedy with respect to this Indenture or the Securities only if:
(i) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(ii) the Holders of at least 25% in aggregate principal
amount of the Securities then outstanding make a written request to the
Trustee to pursue the remedy;
(iii) such Holder or Holders offer and, if requested,
provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
(iv) the Trustee does not comply with the request within
60 days after receipt of the request and the offer of indemnity; and
(v) during such 60-day period, the Holders of a majority
in aggregate principal amount of the Securities then outstanding do not
give the Trustee a direction inconsistent with the request.
A Securityholder may not use this Indenture to prejudice the rights of
another Securityholder or to obtain a preference or priority over another
Securityholder.
6.07 RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any
Holder to receive payment of all amounts due with respect to the Securities, on
or after the respective due dates expressed in the Securities, or to bring suit
for the enforcement of any such payment on or after such respective dates, shall
not be impaired or affected without the consent of the Holder.
Notwithstanding any other provision of this Indenture, the right of any
Holder to bring suit for the enforcement of the right to convert the Security
shall not be impaired or affected without the consent of the Holder.
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6.08 COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in SECTION 6.01(I) or (II) 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 due with respect to
the Securities, including any unpaid and accrued interest.
6.09 TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee may file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have the claims of the Trustee, any
predecessor Trustee and the Securityholders allowed in any judicial proceedings
relative to the Company or its creditors or properties.
The Trustee may 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 judicial proceeding is hereby authorized by each Holder to make
such payments to the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under SECTION 7.07.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
6.10 PRIORITIES.
If the Trustee collects any money pursuant to this ARTICLE VI, it shall
pay out the money in the following order:
First: to the Trustee for amounts due under SECTION 7.07;
Second: to holders of Senior Indebtedness to the extent required
by ARTICLE XI;
Third: to Securityholders for all amounts due and unpaid on the
Securities, without preference or priority of any kind,
according to the amounts due and payable on the Securities;
and
Fourth: to the Company.
The Trustee, upon prior written notice to the Company may fix a record
date and payment date for any payment by it to Securityholders pursuant to this
SECTION 6.10.
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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 in the suit other than the Trustee of an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees, 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 outstanding Securities.
VII. TRUSTEE
7.01 DUTIES OF TRUSTEE.
(A) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(B) Except during the continuance of an Event of Default:
(i) the Trustee need perform only those duties that are
specifically set forth in this Indenture and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith, willful misconduct or
negligence on its part, the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee shall
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture (but need not confirm or
investigate the accuracy of mathematical calculations or other facts
stated therein).
(C) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent
facts; and
(ii) the Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to SECTION 6.05.
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(D) Every provision of this Indenture that in any way relates to
the Trustee is subject to the provisions of this SECTION 7.01.
(E) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds
except to the extent required by law.
7.02 RIGHTS OF TRUSTEE.
(A) Subject to Section 7.01, the Trustee may conclusively rely on
any document believed by it to be genuine and to have been signed or presented
by the proper person. The Trustee need not investigate any fact or matter stated
in the document; if, however, the Trustee shall determine to make such further
inquiry or investigation, it shall be entitled during normal business hours to
examine the relevant books, records and premises of the Company, personally or
by agent or attorney upon reasonable prior notice.
(B) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate and/or an Opinion of Counsel. The Trustee shall
not be liable for any action it takes or omits to take in good faith in reliance
on such Officers' Certificate or Opinion of Counsel.
(C) Any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors shall be sufficiently evidenced by a Board
Resolution.
(D) The Trustee may consult with counsel (such counsel to be
reasonably acceptable to the Company) and the advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon.
(E) The Trustee may act through agents or attorneys and shall not
be responsible for the misconduct or negligence of any agent or attorney
appointed with due care.
(F) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
discretion, rights or powers conferred upon it by this Indenture.
(G) Except with respect to SECTION 6.01, the Trustee shall have no
duty to inquire as to the performance of the Company with respect to the
covenants contained in ARTICLE IV. In addition, the Trustee shall not be deemed
to have knowledge of an Event of Default except (i) any Default or Event of
Default occurring pursuant to SECTIONS 6.01(i) and 6.01(ii) or (ii) any Default
or Event of Default of which a Responsible Officer of the Trustee shall have
received written notification or obtained actual knowledge. Delivery of reports,
information and documents to the Trustee under ARTICLE IV (other than SECTIONS
4.04 and 4.07) is for informational purposes only and the Trustee's receipt of
the foregoing shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
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(H) The Trustee shall be under no obligation to exercise any of
the rights or powers vested by this Indenture at the request or direction of any
of the Holders pursuant to this Indenture unless such Holders shall have offered
to the Trustee security or indemnity reasonably satisfactory to the Trustee
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction.
(I) The rights, privileges, protections, immunities and benefits
given to the Trustee, including without limitation, its right to be indemnified,
are extended to, and shall be enforceable by, the Trustee in each of its
capacities hereunder, and each agent, custodian and other Person employed to act
hereunder.
(J) 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.
7.03 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or any of
its Affiliates with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. The Trustee, however, must comply with
SECTIONS 7.10 and 7.11.
7.04 TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities; it shall not be accountable for the Company's
use of the proceeds from the Securities; and it shall not be responsible for any
statement in the Securities other than its certificate of authentication.
7.05 NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing as to which
the Trustee has received notice pursuant to the provisions of this Indenture,
the Trustee shall mail to each Securityholder a notice of the Default or Event
of Default within 30 days after it occurs unless such Default or Event of
Default has been cured or waived. Except in the case of a Default or Event of
Default in payment of any amounts due with respect to any Security, the Trustee
may withhold the notice if and so long as it in good faith determines that
withholding the notice is in the interests of Securityholders.
7.06 REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each May 15 beginning with May 15, 2002, the
Trustee shall mail to each Securityholder if required by TIA ss. 313(a) a brief
report dated as of such May 15 that complies with TIA ss. 313(c). In such event,
the Trustee also shall comply with TIA ss. 313(b).
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A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Company and filed by the Trustee with the SEC and each
stock exchange, if any, on which the Securities are listed. The Company shall
promptly notify the Trustee when the Securities are listed on any stock
exchange.
7.07 COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time such
compensation for its services as shall be agreed upon in writing. The Trustee's
compensation shall not be limited by any law on compensation of a trustee of an
express trust. The Company shall reimburse the Trustee upon request for all
reasonable out-of-pocket expenses incurred by it. Such expenses shall include
the reasonable compensation and out-of-pocket expenses of the Trustee's agents
and counsel.
The Company shall indemnify the Trustee against any and all loss,
liability, damage, claim or expense (including the reasonable fees and expenses
of counsel and taxes other than those based upon the income of the Trustee)
incurred by it in connection with the acceptance or administration of this trust
and the performance of its duties hereunder, including the reasonable costs and
expenses of defending itself against any claim (whether asserted by the Company,
any Holder or any other Person) or liability in connection with the exercise or
performance of any of its powers and duties hereunder. The Company need not pay
for any settlement made without its consent. The Trustee shall notify the
Company promptly of any claim for which it may seek indemnification. The Company
need not reimburse any expense or indemnify against any loss or liability
incurred by the Trustee through the Trustee's negligence, bad faith or willful
misconduct.
To secure the Company's payment obligations in this SECTION 7.07, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee, except that held in trust to pay amounts due on
particular Securities.
The indemnity obligations of the Company with respect to the Trustee
provided for in this SECTION 7.07 shall survive any resignation or removal of
the Trustee.
When the Trustee incurs expenses or renders services after an Event of
Default specified in SECTION 6.01(v) or (vi) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
7.08 REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this SECTION 7.08.
The Trustee may resign by so notifying the Company in writing 30
business days prior to such resignation. The Holders of a majority in aggregate
principal amount of the Securities then outstanding may remove the Trustee by so
notifying the Trustee and the Company in writing and may appoint a successor
Trustee with the Company's consent. The Company may remove the Trustee if:
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(i) the Trustee fails to comply with SECTION 7.10;
(ii) the Trustee is adjudged a bankrupt or an insolvent;
(iii) a receiver or other public officer takes charge of
the Trustee or its property; or
(iv) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee (at the Company's
expense), the Company or the Holders of at least 10% in aggregate principal
amount of the outstanding Securities may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with SECTION 7.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in SECTION 7.07.
7.09 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business to, another
corporation, the successor corporation without any further act shall be the
successor Trustee, if such successor corporation is otherwise eligible
hereunder.
7.10 ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition. The
Trustee shall comply with TIA ss. 310(b).
7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee shall comply with TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated.
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VIII. DISCHARGE OF INDENTURE
8.01 TERMINATION OF THE OBLIGATIONS OF THE COMPANY.
The Company may terminate all of its obligations under this Indenture
if all Securities previously authenticated and delivered (other than mutilated,
destroyed, lost or stolen Securities which have been replaced or paid as
provided in SECTION 2.07) have been delivered to the Trustee for cancellation or
if:
(i) the Securities 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;
(ii) the Company irrevocably deposits in trust with the
Trustee money or U.S. Government Obligations sufficient to pay the
principal or Redemption Price of and any unpaid and accrued interest on
the Securities to maturity or redemption, as the case may be.
Immediately after making the deposit, the Company shall give notice of
such event to the Securityholders;
(iii) the Company has paid or caused to be paid all sums
then payable by the Company to the Trustee hereunder as of the date of
such deposit; and
(iv) the Company has delivered to the Trustee an opinion
of counsel and an Officers' Certificate stating that all conditions
precedent provided for herein relating to the satisfaction and
discharge of this Indenture have been complied with. The Company may
make the deposit only during the one-year period and only if ARTICLE XI
permits it.
However, the Company's obligations in SECTIONS 2.02, 2.03, 2.04, 2.05, 2.06,
2.07, 2.08, 2.15, 2.16, 2.17, 4.01, 4.02, 7.07, 7.08 and ARTICLE VIII and
ARTICLE X shall survive until the Securities are no longer outstanding.
Thereafter the obligations of the Company in SECTIONS 7.07 and 8.03 shall
survive.
After a deposit pursuant to this SECTION 8.01, the Trustee upon request
shall acknowledge in writing the discharge of the obligations of the Company
under the Securities and this Indenture, except for those surviving obligations
specified above.
In order to have money available on a payment date to pay the principal
or Redemption Price of and any unpaid and accrued interest on the Securities,
the U.S. Government Obligations shall be payable as to principal and any unpaid
and accrued interest on or before such payment date in such amounts as will
provide the necessary money.
"U.S. GOVERNMENT OBLIGATIONS" means direct non-callable obligations of,
or non-callable obligations guaranteed by, the United States of America for the
payment of which the full faith and credit of the United States of America is
pledged.
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8.02 APPLICATION OF TRUST MONEY.
The Trustee shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to SECTION 8.01. It shall apply the deposited money
and the money from U.S. Government Obligations through the Paying Agent and in
accordance with this Indenture to the payment of the principal or Redemption
Price of and any unpaid and accrued interest on the Securities. Money and
securities so held in trust are not subject to the subordination provisions of
ARTICLE XI.
8.03 REPAYMENT TO COMPANY.
The Trustee and the Paying Agent shall promptly notify the Company of,
and pay to the Company upon the request of the Company, any excess money or
securities held by them at any time. The Trustee and the Paying Agent shall pay
to the Company upon the written request of the Company any money held by them
for the payment of the principal or Redemption Price of and any unpaid and
accrued interest that remains unclaimed for two years; provided, however, that
the Trustee or such Paying Agent, before being required to make any such
repayment, may, at the expense and request of the Company, cause to be published
once in a newspaper of general circulation in the City of New York or cause to
be mailed to each Holder, notice stating that such money remains and that, after
a date specified therein, which shall not be less than 30 days from the date of
such publication or mailing, any unclaimed balance of such money then remaining
will be repaid to the Company. After payment to the Company, Securityholders
entitled to the money must look to the Company for payment as general creditors
unless an applicable abandoned property law designates another person and all
liability of the Trustee and the Paying Agent shall cease.
8.04 REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with SECTIONS 8.01 and 8.02 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 obligations of the Company under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to SECTIONS 8.01 and 8.02 until such time as the Trustee or Paying
Agent is permitted to apply all such money or U.S. Government Obligations in
accordance with SECTIONS 8.01 and 8.02; provided, however, that if the Company
has made any payment of amounts due with respect to any Securities because of
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the money
or U.S. Government Obligations held by the Trustee or Paying Agent.
IX. AMENDMENTS
9.01 WITHOUT CONSENT OF HOLDERS.
The Company, with the consent of the Trustee, may amend or supplement
this Indenture or the Securities without notice to or the consent of any
Securityholder:
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(i) to cure any ambiguity, inconsistency or other defect
in this Indenture;
(ii) to comply with SECTIONS 5.01 and 10.12;
(iii) to make any changes or modifications to this
Indenture necessary in connection with the registration of the
Securities under the Securities Act and the qualification of the
Indenture under the TIA;
(iv) to secure the obligations of the Company in respect
of the Securities; or
(v) to add to the covenants of the Company described in
this Indenture for the benefit of Securityholders or to surrender any
right or power conferred upon the Company.
Notwithstanding the foregoing, no supplemental indenture pursuant to
the foregoing clauses (i), (iii), (iv) or (v) of the preceding paragraph may be
entered into without the consent of the holders of a majority in principal
amount of the Securities if such supplemental indenture would materially and
adversely affect the interests of the Holders of the Securities.
9.02 WITH CONSENT OF HOLDERS.
The Company, with the consent of the Trustee, may amend or supplement
this Indenture or the Securities without notice to any Securityholder but with
the written consent of the Holders of at least a majority in aggregate principal
amount of the outstanding Securities. Subject to SECTION 6.07, the Holders of a
majority in aggregate principal amount of the outstanding Securities may waive
compliance by the Company with any provision of this Indenture or the Securities
without notice to any other Securityholder. However, without the consent of each
Securityholder affected, an amendment, supplement or waiver, including a waiver
pursuant to SECTION 6.04, may not:
(i) reduce the amount of Securities whose Holders must
consent to an amendment, supplement or waiver;
(ii) reduce the rate of or change the time for payment of
interest (including any liquidated damages) on any Security;
(iii) reduce the principal, Redemption Price or Repurchase
Price of or change the stated maturity of any Security;
(iv) make any Security payable in money or securities
other than as stated in such Security;
(v) waive a default in the payment of any amount due with
respect to any Security; or
(vi) make any change that adversely affects the right to
convert, or receive payment with respect to, any Security or the right
to institute suit for the
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enforcement of any payment with respect to, or conversion of, any
Security or the right to require the Company to repurchase any of the
Securities upon a Change in Control.
An amendment under this SECTION 9.02 may not make any change that
adversely affects the rights under ARTICLE XI of any holder of Senior
Indebtedness unless the holders of such Senior Indebtedness pursuant to its
terms consent to the change.
Promptly after an amendment under SECTION 9.01 and this SECTION 9.02
becomes effective, the Company shall mail to Securityholders a notice briefly
describing the amendment. Any failure of the Company to mail such notice shall
not in any way impair or affect the validity of such amendment, supplement or
waiver.
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 or
supplement, but it shall be sufficient if such consent approves the substance
thereof.
9.03 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment, waiver or supplement to this Indenture or the
Securities shall comply with the TIA as then in effect.
9.04 REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to its Security or portion of a Security if the Trustee receives the
notice of revocation before the date the amendment, supplement or waiver becomes
effective. An amendment, supplement or waiver becomes effective in accordance
with its terms and thereafter binds every Securityholder.
After an amendment, supplement or waiver becomes effective with respect
to the Securities, it shall bind every Securityholder unless it makes a change
described in SECTION 9.02. In that case, the amendment, supplement or waiver
shall bind each Holder of a Security who has consented to it and, provided that
notice of such amendment, supplement or waiver is reflected on a Security that
evidences the same debt as the consenting Holder's Security, every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security.
9.05 NOTATION ON OR EXCHANGE OF SECURITIES.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security as directed and
prepared by the Company about the changed terms and return it to the Holder.
Alternatively, if the Company so determines, the Company in
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exchange for the Security shall issue and the Trustee shall authenticate a new
Security that reflects the changed terms.
9.06 TRUSTEE PROTECTED.
The Trustee need not sign any amendment, supplement or waiver
authorized pursuant to this ARTICLE IX that adversely affects the Trustee's
rights, duties, liabilities or immunities. The Trustee shall be entitled to
receive and conclusively rely upon an Opinion of Counsel and an Officers'
Certificate that any supplemental indenture, amendment or waiver is permitted or
authorized pursuant to the Indenture.
X. CONVERSION
10.01 CONVERSION PRIVILEGE; RESTRICTIVE LEGENDS.
A Holder of a Security may convert such Security into Common Stock at
any time during the period stated in paragraph 9 of the Securities. The initial
conversion rate is stated in paragraph 9 of the Securities. The conversion rate
is subject to adjustment in accordance with SECTIONS 10.06 through 10.12.
A Holder may convert a portion of the principal of such Security if the
portion is $1,000 principal amount or a positive integral multiple of $1,000
principal amount. Provisions of this Indenture that apply to conversion of all
of a Security also apply to conversion of a portion of it.
Any shares issued upon conversion of a Security shall bear the Private
Placement Legend until after the second anniversary of the later of the issue
date for the Securities and the last date on which the Company or any Affiliate
of the Company was the owner of such shares or the Security (or any predecessor
security) from which such shares were converted (or such shorter period of time
as permitted by Rule 144(k) under the Securities Act or any successor provision
thereunder) (or such longer period of time as may be required under the
Securities Act or applicable state securities laws in the Opinion of Counsel for
the Company, unless otherwise agreed by the Company and the Holder thereof).
10.02 CONVERSION PROCEDURE.
To convert a Security, a Holder must satisfy the requirements in
PARAGRAPH 9 of the Securities. The date on which the Holder satisfies all those
requirements is the conversion date. As soon as practicable following the
conversion date, the Company shall deliver to the Holder through the Conversion
Agent a certificate for the number of full shares of Common Stock issuable upon
the conversion and a check in lieu of any fractional share. The person in whose
name the certificate is registered shall be treated as a stockholder of record
on and after the conversion date.
Except as described below, no payment or adjustment will be made for
accrued interest on, or liquidated damages with respect to, a converted Security
or for dividends on any Common Stock issued on or prior to conversion. If any
Holder surrenders a Security for conversion after the close of business on the
record date for the payment of an installment of interest and prior to
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the opening of business on the next interest payment date, then, notwithstanding
such conversion, the interest payable on such interest payment date shall be
paid to the Holder of such Security on such record date; provided, however, that
such Security, when surrendered for conversion, must be accompanied by payment
to the Trustee on behalf of the Company of an amount equal to the interest
payable on such interest payment date on the portion so converted; provided,
further, however, that such payment to the Trustee described in the immediately
preceding proviso shall not be required in connection with any conversion of a
Security called for redemption pursuant to SECTION 3.04 hereof on a redemption
date that is after a record date for the payment of interest and on or before
the day that is one business day following the corresponding interest payment
date.
If a Holder converts more than one Security at the same time, the
number of full shares issuable upon the conversion shall be based on the total
principal amount of the Securities converted.
Upon surrender of a Security that is converted in part the Trustee
shall authenticate for the Holder a new Security equal in principal amount to
the unconverted portion of the Security surrendered.
If the last day on which a Security may be converted is a Legal Holiday
in a place where a Conversion Agent is located, the Security may be surrendered
to that Conversion Agent on the next succeeding day that is not a Legal Holiday.
10.03 FRACTIONAL SHARES.
The Company will not issue fractional shares of Common Stock upon
conversion of Securities and instead will deliver a check in an amount equal to
the value of such fraction computed on the basis of the last sale price of the
Common Stock as reported on the NNM (or if not listed for trading thereon, then
on the principal securities exchange or on the principal automated quotation
system on which the Common Stock is listed or admitted to trading) at the close
of business on the last trading day prior to the date of conversion. If on the
date of conversion, the Common Stock is not quoted by any such organization, the
fair value of such Common Stock on such day, as reasonably determined in good
faith by the Board of Directors shall be used.
10.04 TAXES ON CONVERSION.
If a Holder converts its Security, the Company shall pay any
documentary, stamp or similar issue or transfer tax due on the issue of shares
of Common Stock upon the conversion. However, the Holder shall pay any such tax
which is due because the shares are issued in a name other than the Holder's
name.
10.05 COMPANY TO PROVIDE STOCK.
The Company shall reserve out of its authorized but unissued Common
Stock or Common Stock held in its treasury enough shares of Common Stock to
permit the conversion of all of the Securities.
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All shares of Common Stock which may be issued upon conversion of the
Securities shall be validly issued, fully paid and non-assessable.
The Company will endeavor to comply with all securities laws regulating
the offer and delivery of shares of Common Stock upon conversion of Securities
and will endeavor to list such shares on each national securities exchange or
automated quotation system on which the Common Stock is listed.
10.06 ADJUSTMENT OF CONVERSION RATE.
The conversion rate shall be subject to adjustment from time to time as
follows:
(a) In case the Company shall (1) pay a dividend in
shares of Common Stock to all holders of Common Stock, (2) make a
distribution in shares of Common Stock to all holders of Common Stock,
(3) subdivide the outstanding shares of Common Stock into a greater
number of shares of Common Stock or (4) combine the outstanding shares
of Common Stock into a smaller number of shares of Common Stock, the
conversion rate in effect immediately prior to such action shall be
adjusted so that the holder of any Security thereafter surrendered for
conversion shall be entitled to receive the number of shares of Common
Stock which he would have owned immediately following such action had
such Securities been converted immediately prior thereto. Any
adjustment made pursuant to this SECTION 10.06(a) shall become
effective immediately after the record date in the case of a dividend
or distribution and shall become effective immediately after the
effective date in the case of a subdivision or combination.
(b) In case the Company shall issue rights or warrants to
all or substantially all holders of Common Stock, as the case may be,
entitling them (for a period commencing no earlier than the record date
for the determination of Holders of Common Stock entitled to receive
such rights or warrants and expiring not more than 60 days after such
record date) to subscribe for or purchase shares of Common Stock (or
securities convertible into Common Stock), at a price per share less
than the then current market price (as determined pursuant to SECTION
10.06(g) below) of Common Stock on such record date, the conversion
rate shall be increased by multiplying the conversion rate in effect
immediately prior to such record date by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding on
such record date, plus the number of shares of Common Stock so offered
for subscription or purchase, and the denominator of which shall be the
number of shares of Common Stock outstanding at the close of business
on such record date plus the number of shares of Common Stock which the
aggregate of the offering price of the total number of shares of Common
Stock so offered for subscription or purchase would purchase at such
current market price. Such adjustments shall become effective
immediately after such record date.
(c) In case the Company shall distribute to all or
substantially all holders of Common Stock shares of capital stock of
the Company other than
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Common Stock, evidences of indebtedness or other assets (other than
cash dividends out of current or retained earnings), or shall
distribute to all or substantially all holders of Common Stock rights
or warrants to subscribe for securities (other than those referred to
in SECTION 10.06(b) above), then in each such case the conversion rate
shall be increased by multiplying the conversion rate in effect
immediately prior to the close of business on the record date for the
determination of shareholders entitled to such distribution by a
fraction of which the numerator shall be the current market price of
Common Stock (determined as provided in SUBSECTION (g) below), on such
date and the denominator shall be such current market price less the
fair market value (as determined by the Board of Directors whose
determination shall be conclusive and described in a Board Resolution)
on such date of the portion of the evidences of indebtedness, shares of
capital stock, cash and other assets to be distributed or of such
subscription rights or warrants applicable to one share of Common
Stock, such increase to become effective immediately prior to the
opening of business on the day following such record date.
Notwithstanding the foregoing, in the event that the Company shall
distribute rights or warrants (other than those referred to in SECTION
10.06(b) above) ("RIGHTS") pro rata to holders of Common Stock, the
Company may, in lieu of making any adjustment pursuant to this SECTION
10.06(c), make proper provision so that each Holder of a Security who
converts such Security (or any portion thereof) after the record date
for such distribution and prior to the expiration or redemption of the
Rights shall be entitled to receive upon such conversion, in addition
to the shares of Common Stock issuable upon such conversion (the
"CONVERSION SHARES"), a number of Rights to be determined as follows:
(i) if such conversion occurs on or prior to the date for the
distribution to the holders of Rights of separate certificates
evidencing such Rights (the "DISTRIBUTION DATE"), the same number of
Rights to which a holder of a number of shares of Common Stock equal to
the number of shares of Conversion Shares is entitled at the time of
such conversion in accordance with the terms and provisions of and
applicable to the Rights; and (ii) if such conversion occurs after the
Distribution Date, the same number of Rights to which a holder of the
number of shares of Common Stock into which the principal amount of the
Security so converted was convertible immediately prior to the
Distribution Date would have been entitled on the Distribution Date in
accordance with the terms and provisions of and applicable to the
Rights.
(d) In case the Company shall, by dividend or otherwise,
at any time make a distribution (the "TRIGGERING DISTRIBUTION," and the
amount of the Triggering Distribution, together with the sum of (w) and
(x) below, the "COMBINED AMOUNT") to all or substantially all holders
of its Common Stock of cash (including any distributions of cash out of
current or retained earnings of the Company, but excluding any cash
that is distributed as part of a distribution requiring a conversion
rate adjustment pursuant to SUBSECTION (c) above or SUBSECTION (e)
below) in an aggregate amount that, together with the sum of (w) the
aggregate amount of any cash and the fair market value (as determined
in good faith by the Board of Directors, whose determination shall be
conclusive thereof and described in a Board Resolution), as of the
expiration of the tender or
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exchange offer referred to below, of any other consideration payable in
respect of any tender or exchange offer by the Company or a subsidiary
of the Company for all or any portion of the Common Stock consummated
within the 12 months preceding the date of payment of the Triggering
Distribution and in respect of which no conversion rate adjustment has
been made pursuant to this SECTION 10.06, and (x) the aggregate amount
of all other cash distributions to all or substantially all holders of
Common Stock made within the 12 months preceding the date of payment of
the Triggering Distribution and in respect of which no conversion rate
adjustment has been made pursuant to this SECTION 10.06, exceeds 10% of
the product of the current market price per share (as determined in
accordance with SUBSECTION (g) of this SECTION 10.06) of the Common
Stock on the close of business, New York City time, on the business day
(the "DISTRIBUTION DECLARATION DATE") immediately preceding the day on
which the Triggering Distribution is declared by the Company and the
number of shares of Common Stock outstanding on the Distribution
Declaration Date (excluding shares held in the treasury of the
Company), the conversion rate shall be adjusted by multiplying the
conversion rate in effect immediately prior to the effectiveness of the
conversion rate adjustment contemplated by this SUBSECTION (d) by a
fraction (y) the numerator of which shall be such current market price
per share of Common Stock and (z) the denominator of which shall be (I)
such current market price per share of Common Stock less (II) the
number obtained by dividing the Combined Amount by such number of
shares of Common Stock outstanding. Such adjustment shall become
effective immediately prior to the opening of business on the day
following the Distribution Declaration Date.
(e) In case a tender offer or exchange 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 or exchange 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 or exchange offer) of Purchased Shares (as defined
below)) of an aggregate consideration having a fair market value (as
determined by the Board of Directors, whose determination shall be
conclusive and set forth in a Board Resolution) that combined together
with:
(1) 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 or exchange offer, of consideration
payable in respect of any other tender offers or
exchange 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 or exchange offer
and in respect of which no adjustment pursuant to
this Section 10.06 has been made, and
(2) the aggregate amount of any distributions to all or
substantially all holders of the Company's Common
Stock made exclusively in cash within the 12 months
preceding the expiration of such tender offer
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or exchange offer and in respect of which no
adjustment pursuant to Section 10.06 has been made,
exceeds 10% of the product of the current market
price per share (as determined in accordance with
subsection (g) of this Section 10.06) as of the last
time (the "Expiration Time") tenders or exchanges
could have been made pursuant to such tender offer
or exchange offer (as it may be amended) times the
number of shares of Common Stock outstanding
(including any tendered shares or exchanged shares)
at the Expiration Time,
then, and in each such case, immediately prior to the opening
of business on the day after the date of the Expiration Time,
the conversion rate shall be adjusted by multiplying the
conversion rate in effect immediately prior to the close of
business on the date of the Expiration Time by a fraction:
(i) 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 or exchange offer)
of all shares validly tendered or exchanged and not
withdrawn as of the Expiration Time (the shares
deemed so accepted, up to any such maximum, being
referred to as the "Purchased Shares") and (y) the
product of the number of shares of Common Stock
outstanding (less any Purchased Shares) at the
Expiration Time and the current market price of the
Common Stock as of the Expiration Time; and
(ii) the denominator of which shall be the number of
shares of Common Stock outstanding (including any
tendered or exchanged shares) at the Expiration Time
multiplied by the current market price of the Common
Stock as of the Expiration Time.
Such adjustment (if any) shall become effective immediately
prior to the opening of business on the day following the
Expiration Time. In the event that the Company is obligated
to purchase shares pursuant to any such tender offer or
exchange offer, but the Company is permanently prevented by
applicable law from effecting any such purchases or all such
purchases are rescinded, the conversion rate shall again be
adjusted to be the conversion rate which would then be in
effect if such tender offer or exchange offer had not been
made. If the application of this Section 10.06(e) to any
tender offer or exchange offer would result in a decrease in
the conversion rate, no adjustment shall be made for such
tender offer or exchange offer under this Section 10.06(e).
(f) In addition to the foregoing adjustments in
subsections (a), (b), (c), (d) and (e) above, the Company, from time to
time and to the extent permitted by law, may increase the conversion
rate by any amount for at least 20 days or such
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longer period as may be required by law, if the Board of Directors of
the Company has made a determination, which determination shall be
conclusive, that such increase would be in the best interests of the
Company, provided that the effective conversion price is not less than
the par value of a share of Common Stock. The Company shall give notice
to the Trustee and cause notice of such increase to be mailed to each
Holder of Securities at such Holder's address as the same appears on
the registry books of the Registrar, at least 15 days prior to the date
on which such increase commences. Such conversion rate increase shall
be irrevocable during such period.
(g) For the purpose of any computation under subsections
(a), (b), (c), (d) and (e) above of this SECTION 10.06, the current
market price per share of Common Stock on the date fixed for
determination of the stockholders entitled to receive the issuance or
distribution requiring such computation (the "DETERMINATION DATE")
shall be deemed to be the average of the Daily Market Prices for the
ten consecutive trading days immediately preceding the Determination
Date; provided, however, that (i) if 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 subsection
(a), (b), (c), (d) or (e) above occurs on or after the tenth trading
day prior to the Determination Date and prior to the "ex" date for the
issuance or distribution requiring such computation, the Daily Market
Price for each trading day prior to the "ex" date for such other event
shall be adjusted by multiplying such Daily Market 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, (ii) if 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 subsection (a), (b), (c), (d) or (e) above occurs on or
after the "ex" date for the issuance or distribution requiring such
computation and on or prior to the Determination Date, the Daily Market
Price for each business day on and after the "ex" date for such other
event shall be adjusted by multiplying such Daily Market Price by the
same fraction by which the conversion rate is so required to be
adjusted as a result of such other event, and (iii) if the "ex" date
for the issuance or distribution requiring such computation is on or
prior to the Determination Date, after taking into account any
adjustment required pursuant to clause (i) or (ii) of this proviso, the
Daily Market Price for each trading day on and after the "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 the purposes of
this SECTION 10.06, whose determination shall be conclusive and
described in a Resolution of the Board of Directors) of the evidences
of indebtedness, shares of capital stock or other securities or assets
being distributed (in the distribution requiring such computation)
applicable to one share of Common Stock as of the close of business on
the day before such "ex" date. For the purpose of any computation under
SUBSECTION (e) of this SECTION 10.06, the current market price per
share of Common Stock at the expiration time for the tender offer
requiring such computation shall be deemed to be the average of the
Daily Market Price for the ten consecutive trading days commencing on
the
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business day immediately following the expiration time of such tender
offer (the "COMMENCEMENT DATE"); 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 subsection (a), (b), (c), (d) or (e) above occurs on or
after the expiration time for the tender offer requiring such
computation and prior to the day in question, the Daily Market Price
for each trading day on or after to the "ex" date for such other event
shall be adjusted by multiplying such Daily Market Price by the same
fraction by which the conversion rate is so required to be adjusted as
a result of such other event. For purposes of this subsection, the term
"ex" date, (i) when used with respect to any issuance or distribution,
means the first date on which the Common Stock trades regular way on
the relevant exchange or in the relevant market from which the Daily
Market Price was obtained without the right to receive such issuance or
distribution, (ii) when used with respect to any subdivision or
combination of shares of Common Stock, means the first date on which
the Common Stock trades regular way on such exchange or in such market
after the time at which such subdivision or combination becomes
effective, and (iii) when used with respect to any tender 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 tender
offer (as it may be amended or extended).
10.07 NO ADJUSTMENT.
No adjustment in the conversion rate shall be required until cumulative
adjustments amount to 1% or more of the conversion rate as last adjusted;
provided, however, that any adjustments which by reason of this SECTION 10.07
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this ARTICLE X shall be made
to the nearest cent or to the nearest one-hundredth of a share, as the case may
be. No adjustment need be made for rights to purchase Common Stock pursuant to a
Company plan for reinvestment of dividends or interest. No adjustment need be
made for a change in the par value of the Common Stock.
If any rights, options or warrants issued by the Company as described
in SECTION 10.06 are only exercisable upon the occurrence of certain triggering
events, then the conversion rate will not be adjusted as provided in SECTION
10.06 until the earliest of such triggering event occurs. Upon the expiration or
termination of any rights, options or warrants without the exercise of such
rights, options or warrants, the conversion rate then in effect shall be
adjusted immediately to the conversion rate which would have been in effect at
the time of such expiration or termination had such rights, options or warrants,
to the extent outstanding immediately prior to such expiration or termination,
never been issued.
No adjustment need be made for a transaction referred to in this
ARTICLE X if Securityholders are to participate in the transaction without
conversion on a basis and with notice that the Board of Directors determines to
be fair and appropriate in light of the basis and notice on which holders of
Common Stock participate in the transaction.
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10.08 OTHER ADJUSTMENTS.
In the event that, as a result of an adjustment made pursuant to
SECTION 10.06 hereof, the Holder of any Security thereafter surrendered for
conversion shall become entitled to receive any shares of Capital Stock other
than shares of Common Stock, thereafter the conversion rate of such other shares
so receivable upon conversion of any Security shall be subject to adjustment
from time to time in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to Common Stock contained in this ARTICLE X.
10.09 ADJUSTMENTS FOR TAX PURPOSES.
The Company may make such increases in the conversion rate, in addition
to those required by SECTION 10.06 hereof, as it determines to be advisable in
order that any stock dividend, subdivision of shares, distribution or rights to
purchase stock or securities or distribution of securities convertible into or
exchangeable for stock made by the Company or to its stockholders will not be
taxable to the recipients thereof.
10.10 NOTICE OF ADJUSTMENT.
Whenever the conversion rate is adjusted, the Company shall promptly
mail to Holders at the addresses appearing on the Registrar's books a notice of
the adjustment and file with the Trustee an Officers' Certificate briefly
stating the facts requiring the adjustment and the manner of computing it. The
certificate shall be conclusive evidence of the correctness of such adjustment.
10.11 NOTICE OF CERTAIN TRANSACTIONS.
In the event that:
(1) the Company takes any action which would require an
adjustment in the conversion rate;
(2) the Company takes any action that would require a
supplemental indenture pursuant to SECTION 10.12; or
(3) there is a dissolution or liquidation of the Company;
a Holder of a Security may wish to convert such Security into shares of Common
Stock prior to the record date for or the effective date of the transaction so
that he may receive the rights, warrants, securities or assets which a holder of
shares of Common Stock on that date may receive. Therefore, the Company shall
mail to Holders at the addresses appearing on the Registrar's books and the
Trustee a notice stating the proposed record or effective date, as the case may
be, of any transaction referred to in CLAUSE (1), (2) or (3) of this SECTION
10.11. The Company shall mail such notice at least 15 days before such date;
however, failure to mail such notice or any defect therein shall not affect the
validity of any transaction referred to in CLAUSE (1), (2) or (3) of this
SECTION 10.11.
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10.12 EFFECT OF RECLASSIFICATIONS, CONSOLIDATIONS, MERGERS, BINDING SHARE
EXCHANGES OR SALES ON CONVERSION PRIVILEGE.
If any of the following shall occur, namely: (i) any reclassification
or change in the Common Stock issuable upon conversion of Securities (other than
a change in par value, or from par value to no par value, or from no par value
to par value, or as a result of a subdivision or combination), (ii) any
consolidation, merger or binding share exchange to which the Company is a party
other than a merger in which the Company is the continuing corporation and which
does not result in any reclassification of, or change (other than a change in
name, or 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) in, the Common Stock,
or (iii) any sale or conveyance of all or substantially all of the property or
business of the Company as an entirety, then the Company or such successor or
purchasing corporation, as the case may be, shall, as a condition precedent to
such reclassification, change, consolidation, merger, binding share exchange,
sale or conveyance, execute and deliver to the Trustee a supplemental indenture
in form reasonably satisfactory to the Trustee providing that the Holder of each
Security then outstanding shall have the right to convert such Security into the
kind and amount of shares of stock and other securities and property (including
cash) receivable upon such reclassification, change, consolidation, merger,
binding share exchange, sale or conveyance by a holder of the number of shares
of Common Stock, deliverable upon conversion of such Security immediately prior
to such reclassification, change, consolidation, merger, binding share exchange,
sale or conveyance. Such supplemental indenture shall provide for adjustments of
the conversion rate which shall be as nearly equivalent as may be practicable to
the adjustments of the conversion rate provided for in this ARTICLE X. The
foregoing, however, shall not in any way affect the right a Holder of a Security
may otherwise have, pursuant to CLAUSE (ii) of the last sentence of SUBSECTION
(c) of SECTION 10.06 hereof, to receive Rights upon conversion of a Security.
If, in the case of any such consolidation, merger, binding share exchange, sale
or conveyance, the stock or other securities and property (including cash)
receivable thereupon by a holder of Common Stock includes shares of stock or
other securities and property of a corporation other than the successor or
purchasing corporation, as the case may be, in such consolidation, merger,
binding share exchange, 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 Securities
as the Board of Directors shall reasonably consider necessary by reason of the
foregoing. The provision of this SECTION 10.12 shall similarly apply to
successive consolidations, mergers, binding share exchanges, sales or
conveyances.
In the event the Company shall execute a supplemental indenture
pursuant to this SECTION 10.12, the Company shall promptly file with the Trustee
an Officers' Certificate briefly stating the reasons therefor, the kind or
amount of shares of stock or securities or property (including cash) receivable
by Holders of the Securities upon the conversion of their Securities after any
such reclassification, change, consolidation, merger, binding share exchange,
sale or conveyance and any adjustment to be made with respect thereto.
10.13 TRUSTEE'S DISCLAIMER.
The Trustee has no duty to determine when an adjustment under this
ARTICLE X should be made, how it should be made or what such adjustment should
be, but may accept as conclusive
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evidence of the correctness of any such adjustment, and shall be protected in
relying upon the Officers' Certificate with respect thereto which the Company is
obligated to file with the Trustee pursuant to SECTION 10.10 hereof. The Trustee
makes no representation as to the validity or value of any securities or assets
issued upon conversion of Securities, and the Trustee shall not be responsible
for the failure by the Company to comply with any provisions of this ARTICLE X.
The Trustee shall not be under any responsibility to determine the
correctness of any provisions contained in any supplemental indenture executed
pursuant to SECTION 10.12, but may accept as conclusive evidence of the
correctness thereof, and shall be protected in relying upon, the Officers'
Certificate with respect thereto which the Company is obligated to file with the
Trustee pursuant to SECTION 10.12 hereof.
XI. SUBORDINATION
11.01 AGREEMENT TO SUBORDINATE.
The Company agrees, and each Securityholder by accepting a Security
agrees, that the payment of all amounts due with respect to the Securities is
subordinated in right of payment, to the extent and in the manner provided in
this ARTICLE XI, to the prior payment in full of all Senior Indebtedness and
that the subordination is for the benefit of the holders of Senior Indebtedness.
Money and securities held in trust pursuant to ARTICLE VIII are not
subject to the subordination provisions of this ARTICLE XI.
11.02 CERTAIN DEFINITIONS.
"INDEBTEDNESS" means, with respect to any person, the principal of, and
premium, if any, and interest on (a) all indebtedness of such person for
borrowed money (including all indebtedness evidenced by notes, bonds, debentures
or other securities sold by such person for money), (b) all obligations incurred
by such person in the acquisition (whether by way of purchase, merger,
consolidation or otherwise and whether by such person or another person) of any
business, real property or other assets (except trade payables), (c) guarantees
by such person of indebtedness described in clause (a) or (b) of another person,
(d) all renewals, extensions, refundings, deferrals, restructurings, amendments
and modifications of any such indebtedness, obligation or guarantee, (e) all
reimbursement obligations of such person with respect to letters of credit,
bankers' acceptances or similar facilities issued for the account of such
person, (f) all capital lease obligations of such person and (g) all net
obligations of such person under interest rate swap, currency exchange or
similar agreements of such person.
"REPRESENTATIVE" means the indenture trustee or other trustee, agent or
representative for an issue of Senior Indebtedness.
"SENIOR INDEBTEDNESS" means all Indebtedness of the Company outstanding
at any time, except the Securities, Indebtedness that by its terms provides that
it shall not be "senior" in right of payment to the Securities or Indebtedness
that by its terms provides that it shall be "pari passu" or "junior" in right of
payment to the Securities. Senior Indebtedness does not include Indebtedness of
the Company to any of its subsidiaries.
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11.03 LIQUIDATION; DISSOLUTION; BANKRUPTCY.
Upon any distribution of assets to creditors of the Company in a
liquidation, winding up or dissolution of the Company, or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Company or its property:
(i) holders of Senior Indebtedness shall be
entitled to receive payment in full of the principal of and
interest (including interest accruing after the commencement
of any such proceeding) to the date of payment on the Senior
Indebtedness before Securityholders shall be entitled to
receive any payment from the Company of amounts due with
respect to the Securities (other than cash payments due upon
conversion of Securities in lieu of fractional shares); and
(ii) until the Senior Indebtedness is paid in
full, any distribution to which Securityholders would be
entitled from the Company but for this ARTICLE XI shall be
made to holders of Senior Indebtedness, as their interests
may appear, except the Securityholders may receive securities
that are subordinated to Senior Indebtedness to at least the
same extent as the Securities and payments made pursuant to
SECTIONS 8.01 and 8.02.
11.04 COMPANY NOT TO MAKE PAYMENTS WITH RESPECT TO SECURITIES IN CERTAIN
CIRCUMSTANCES.
No payment of amounts due may be made by the Company, directly or
indirectly, with respect to the Securities (including any repurchase pursuant to
the exercise of the Repurchase Right, but excluding cash payments due upon
conversion in lieu of fractional shares) or to acquire any of the Securities at
any time if a default in payment of the principal of or premium, if any, or
interest on Senior Indebtedness exists beyond any applicable grace period,
unless and until such default shall have been cured or waived or shall have
ceased to exist. During the continuance of any default with respect to any
Senior Indebtedness pursuant to which any Senior Indebtedness has been issued
(other than default in payment of the principal of or premium, if any, or
interest on any Senior Indebtedness), permitting the holders thereof to
accelerate the maturity thereof, no payment may be made by the Company, directly
or indirectly, of any amount due with respect to the Securities (a "PAYMENT
BLOCKAGE") until the earlier of (i) the date on which such default has been
cured or waived, (ii) 180 days following receipt of written notice (a "PAYMENT
BLOCKAGE NOTICE") to the Company from any holder or holders thereof or its
Representative or Representatives or the trustee or trustees under any indenture
under which any instrument evidencing any such Senior Indebtedness may have been
issued, that such a default has occurred and is continuing, (iii) the date on
which such Senior Indebtedness is discharged or paid in full or (iv) the date of
which the imposition of such Payment Blockage shall have been terminated by
written notice to such trustee or the Company from such trustee or other
representative initiating such Payment Blockage. Notwithstanding the foregoing,
no new Payment Blockage Notice shall be given until a period of at least 365
consecutive days shall have elapsed since the beginning of the prior Payment
Blockage period. No default (other than a default in payment) that existed or
was continuing on the date of delivery of any Payment Blockage Notice shall be
the basis for any subsequent Payment Blockage Notice, unless such default has
been cured or waived for a period of not less than 90 consecutive days. However,
if
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the maturity of such Senior Indebtedness is accelerated, no payment may be made
by the Company on the Securities until such Senior Indebtedness that has matured
has been paid or such acceleration has been cured or waived.
Regardless of anything to the contrary herein, nothing shall prevent
(a) any payment by the Trustee to the Securityholders of amounts deposited with
it pursuant to ARTICLE VIII or (b) any payment by the Trustee or the Paying
Agent as permitted by SECTION 11.12. Nothing contained in this ARTICLE XI will
limit the right of the Trustee or the Securityholders to take any action to
accelerate the maturity of the Securities pursuant to SECTION 6.02 or to pursue
any rights or remedies hereunder.
11.05 ACCELERATION OF SECURITIES.
If payment of the Securities is accelerated because of an Event of
Default, the Company shall promptly notify holders of Senior Indebtedness of the
acceleration.
11.06 WHEN DISTRIBUTION MUST BE PAID OVER.
In the event that the Company shall make any payment to the Trustee
with respect to the Securities at a time when such payment is prohibited by
SECTION 11.03 or 11.04, such payment shall be held by the Trustee, in trust for
the benefit of, and shall be paid forthwith over and delivered to, the holders
of Senior Indebtedness (pro rata as to each of such holders on the basis of the
respective amounts of Senior Indebtedness held by them) or their Representative
or the trustee under the indenture or other agreement (if any) pursuant to which
Senior Indebtedness may have been issued, as their respective interests may
appear, for application to the payment of all Senior Indebtedness remaining
unpaid to the extent necessary to pay all Senior Indebtedness in full in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
If a distribution is made to Securityholders, that because of this
ARTICLE XI should not have been made to them, the Securityholders who receive
the distribution shall hold it in trust for holders of Senior Indebtedness and
pay it over to them as their interests may appear.
11.07 NOTICE BY COMPANY.
The Company shall promptly notify the Trustee and the Paying Agent in
writing of any facts known to the Company that would cause a payment of any
amount due with respect to the Securities to violate this ARTICLE XI, but
failure to give such notice shall not affect the subordination of the Securities
to the Senior Indebtedness provided in this ARTICLE XI.
11.08 SUBROGATION.
After all Senior Indebtedness is paid in full and until the Securities
are paid in full, Securityholders shall be subrogated (equally and ratably with
all other Indebtedness of the Company ranking pari passu with the Securities) to
the rights of holders of Senior Indebtedness to receive distributions applicable
to Senior Indebtedness to the extent that distributions otherwise payable to the
Securityholders have been applied to the payment of Senior Indebtedness. A
distribution made under this ARTICLE XI to holders of Senior Indebtedness
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which otherwise would have been made to Securityholders is not, as between the
Company and Securityholders, a payment by the Company on Senior Indebtedness.
11.09 RELATIVE RIGHTS.
This ARTICLE XI defines the relative rights of Securityholders and
holders of Senior Indebtedness. Nothing in this Indenture shall:
(i) impair, as between the Company, on the one
hand, and Securityholders, on the other hand, the obligation
of the Company, which is absolute and unconditional, to pay
all amounts due with respect to the Securities in accordance
with their terms;
(ii) affect the relative rights of
Securityholders and creditors of the Company other than
holders of Senior Indebtedness; or
(iii) prevent the Trustee or any Securityholder
from exercising its available remedies upon a Default or
Event of Default, subject to the rights of holders of Senior
Indebtedness to receive distributions otherwise payable to
Securityholders.
Upon any distribution of assets of the Company referred to in this
ARTICLE XI, the Trustee, subject to the provisions of SECTIONS 7.01 and 7.02,
and the Holders of the Securities shall be entitled to rely upon any order or
decree by any court of competent jurisdiction in which such dissolution, winding
up, liquidation or reorganization proceedings are pending, or a certificate of
the liquidating trustee or agent or other person making any distribution to the
Trustee or the Holders of the Securities, for the purpose of ascertaining the
persons entitled to participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this ARTICLE XI. Nothing contained in this ARTICLE
XI or elsewhere in this Indenture or in any Security is intended to or shall
affect the obligation of the Company to make, or prevent the Company from
making, at any time except during the pendency of any dissolution, winding up,
liquidation or reorganization proceeding, and except during the continuance of
any default specified in SECTION 11.04 (not cured or waived), payments at any
time of all amounts due with respect to the Securities.
11.10 SUBORDINATION MAY NOT BE IMPAIRED BY COMPANY.
No right of any holder of Senior Indebtedness to enforce the
subordination of the indebtedness evidenced by the Securities shall be impaired
by any act or failure to act by the Company or by the failure of the Company to
comply with this Indenture.
11.11 DISTRIBUTION OR NOTICE TO REPRESENTATIVE.
Whenever a distribution is to be made or a notice given to holders of
Senior Indebtedness, the distribution may be made and the notice given to their
Representatives.
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11.12 RIGHTS OF TRUSTEE AND PAYING AGENT.
The Trustee or Paying Agent may continue to make payments on the
Securities until it receives written notice of facts that would cause a payment
of amounts due with respect to the Securities to violate this ARTICLE XI. Only
the Company or a Representative or a holder of an issue of Senior Indebtedness
that has no Representative may give the notice.
The Trustee shall be entitled to conclusively rely on the delivery to
it of a written notice by a person representing himself to be a holder of Senior
Indebtedness (or a Representative on behalf of such holder) to establish that
such notice has been given by a holder of Senior Indebtedness or a
Representative on behalf of any such holder. In the event that the Trustee
determines in good faith that further evidence is required with respect to the
right of any person who is a holder of Senior Indebtedness to participate in any
payment or distribution pursuant to this ARTICLE XI, the Trustee may request
such person to furnish evidence to the reasonable satisfaction of the Trustee as
to the amount of Senior Indebtedness held by such person, the extent to which
such person is entitled to participate in such payment or distribution and any
other facts pertinent to the rights of such person under this ARTICLE XI, and if
such evidence is not furnished the Trustee may defer any payment to such person
pending judicial determination as to the right of such person to receive such
payment or until such time as the Trustee shall be otherwise satisfied as to the
right of such person to receive such payment.
The Trustee in its individual or any other capacity may hold Senior
Indebtedness with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights.
The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness and shall not be liable to any such holder if it
shall mistakenly pay over or distribute to Securityholders or the Company or any
other person money or assets to which any holders of Senior Indebtedness shall
be entitled by virtue of this ARTICLE XI or otherwise.
11.13 OFFICERS' CERTIFICATE.
If there occurs an event referred to in SECTION 11.03 or 11.04, the
Company shall promptly give to the Trustee an Officers' Certificate (on which
the Trustee may conclusively rely) identifying all holders of Senior
Indebtedness or their Representatives and the principal amount of Senior
Indebtedness then outstanding held by each such holder and stating the reasons
why such Officers' Certificate is being delivered to the Trustee.
11.14 NOT TO PREVENT EVENTS OF DEFAULT.
The failure to make any payment due with respect to the Securities by
reason of any provision of this ARTICLE XI shall not be construed as preventing
the occurrence of an Event of Default under SECTION 6.01
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XII. MISCELLANEOUS
12.01 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 of the TIA shall control.
12.02 NOTICES.
Any notice or communication by the Company or the Trustee to one or
both of the others is duly given if in writing and delivered in person, mailed
by first-class mail or by express delivery to the other parties' addresses
stated in this SECTION 12.02. The Company or the Trustee by notice to the others
may designate additional or different addresses for subsequent notices or
communications.
Any notice or communication to a Securityholder shall be mailed to its
address shown on the register kept by the Registrar. Failure to mail a notice or
communication to a Securityholder or any defect in it shall not affect its
sufficiency with respect to other Securityholders.
If a notice or communication is mailed in the manner provided above, it
is duly given, whether or not the addressee receives it.
If the Company mails a notice or communication to Securityholders, it
shall mail a copy to the other and to the Trustee and each Agent at the same
time.
All notices or communications shall be in writing.
The Company's address is:
WebMD Corporation
669 River Drive, Center 2
Elmwood Park, New Jersey 07407-1361
Facsimile: (201) 703-3401
Attention: Executive Vice President -
Chief Financial Officer
The Trustee's address is:
The Bank of New York
101 Barclay Street, Floor 21W
New York, NY 10286
Facsimile: (212) 896-7298
Attention: Corporate Trust Administration
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12.03 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA ss. 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA ss. 312(c).
12.04 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(i) 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
(ii) an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent have
been complied with.
Each signer of an Officers' Certificate or an Opinion of Counsel may
(if so stated) rely, effectively, upon an Opinion of Counsel as to legal matters
and an Officers' Certificate as to factual matters if such signer reasonably and
in good faith believes in the accuracy of the document relied upon.
12.05 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each Officers' Certificate or Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:
(i) a statement that the person making such
certificate or opinion has read such covenant or condition;
(ii) a brief statement as to the nature and
scope of the examination or investigation upon which the
statements or opinions contained in such certificate or
opinion are based;
(iii) a statement that, in the opinion of such
person, he or she has made such examination or investigation
as is necessary to enable him or her to express an informed
opinion as to whether or not such covenant or condition has
been complied with; and
(iv) a statement as to whether or not, in the
opinion of such person, such condition or covenant has been
complied with.
12.06 RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Registrar, Paying Agent or Conversion Agent may make
reasonable rules and set reasonable requirements for their respective functions.
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12.07 LEGAL HOLIDAYS.
A "LEGAL HOLIDAY" is a Saturday, a Sunday or a day on which banking
institutions are not required to be open in the City of New York, in the State
of New York or in the city in which the Trustee administers its corporate trust
business. If a payment date is a Legal Holiday at a place of payment, payment
may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue on that payment for the intervening
period.
A "BUSINESS DAY" is a day other than a Legal Holiday.
12.08 NO RECOURSE AGAINST OTHERS.
No past, present or future director, officer, employee, incorporator or
stockholder of the Company, as such, shall have any liability for any
obligations of the Company under the Securities or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for the issuance
of the Securities.
12.09 DUPLICATE 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. Delivery of an executed counterpart by facsimile shall be effective
as delivery of a manually executed counterpart thereof.
12.10 GOVERNING LAW.
The laws of the State of New York, without regard to principles of
conflicts of law, shall govern this Indenture and the Securities.
12.11 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or any of its subsidiaries. Any such indenture,
loan or debt agreement may not be used to interpret this Indenture.
12.12 SUCCESSORS.
All agreements of the Company in this Indenture and the Securities
shall bind their respective successors. All agreements of the Trustee in this
Indenture shall bind its successors.
12.13 SEPARABILITY.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby
and a Holder shall have no claim therefor against any party hereto.
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12.14 TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first above written.
WEBMD CORPORATION
By: /s/ Anthony Vuolo
--------------------------------------
Name: Anthony Vuolo
Title: Executive Vice President -
Chief Financial Officer
THE BANK OF NEW YORK
By: /s/ Marie E. Trimboli
--------------------------------------
Name: Marie E. Trimboli
Title: Assistant Vice President
EXHIBIT A
[Face of Security]
WEBMD CORPORATION
[Certificate No. _______]
[INSERT PRIVATE PLACEMENT LEGEND AND GLOBAL SECURITY LEGEND
AS REQUIRED]
3 1/4% CONVERTIBLE SUBORDINATED NOTE DUE 2007
CUSIP NO. ____________
WEBMD CORPORATION, a Delaware corporation (herein called the
"COMPANY"), for value received, hereby promises to pay to Cede & Co. or
registered assigns, the principal sum of _________________ Dollars
($_______________) on April 1, 2007, and to pay interest thereon, as provided on
the reverse hereof, until the principal and any unpaid and accrued interest is
paid or duly provided for. The right to payment of the principal and all other
amounts due with respect hereto is subordinated to the rights of Senior
Indebtedness as set forth in the Indenture referred to on the reverse side
hereof.
Interest Payment Dates: April 1 and October 1, with the first payment
to be made on October 1, 2002.
Record Dates: March 15 and September 15.
The provisions on the back of this certificate are incorporated as if
set forth on the face hereof.
IN WITNESS WHEREOF, WEBMD CORPORATION has caused this instrument to be
duly signed.
WEBMD CORPORATION
By:
--------------------------------------
Name:
Title:
Dated: _______________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to
in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee
By:
-----------------------------------
Authorized Signatory
Dated: ________________
A-2
[REVERSE OF SECURITY]
WEBMD CORPORATION
3 1/4% CONVERTIBLE SUBORDINATED NOTE DUE 2007
1. INTEREST. WEBMD CORPORATION, a Delaware corporation (the
"COMPANY"), promises to pay interest on the principal amount of this Security at
the rate PER ANNUM shown above. The Company will pay interest semi-annually on
April 1 and October 1 of each year, with the first payment to be made on October
1, 2002. Interest on the Securities will accrue on the principal amount from the
most recent date to which interest has been paid or provided for or, if no
interest has been paid, from April 1, 2002. Interest will be computed on the
basis of a 360-day year of twelve 30-day months.
2. MATURITY. The Notes will mature on April 1, 2007.
3. METHOD OF PAYMENT. The Company will pay interest on the
Securities (except defaulted interest) to the persons who are registered Holders
of Securities at the close of business on the record date set forth on the face
of this Security next preceding the applicable interest payment date. Holders
must surrender Securities to a Paying Agent to collect the principal, Redemption
Price or Repurchase Price of the Securities. The Company will pay all amounts
due with respect to the Securities in money of the United States that at the
time of payment is legal tender for payment of public and private debts. If this
Security is in global form, the Company will pay interest on the Securities by
wire transfer of immediately available funds to the account specified by the
Holder. With respect to securities held other than in global form, the Company
will make payments by wire transfer of immediately available funds to the
account specified by the Holders thereof or, if no such account is specified
with respect to a Holder, by mailing a check to the Holder's registered address.
4. PAYING AGENT, REGISTRAR, CONVERSION AGENT. Initially, THE BANK
OF NEW YORK (the "TRUSTEE") will act as Paying Agent, Registrar and Conversion
Agent. The Company may change any Paying Agent, Registrar or Conversion Agent
without notice. The Company may act in any such capacity.
5. INDENTURE. The Company issued the Securities under an
Indenture dated as of April 1, 2002 (the "INDENTURE") between the Company and
the Trustee. The terms of the Securities include those stated in the Indenture
and those made part of the Indenture by reference to the Trust Indenture Act of
1939 (15 U.S. Code ss.ss. 77aaa-77bbbb) (the "ACT") as in effect on the date of
the Indenture. The Securities are subject to all such terms, and Securityholders
are referred to the Indenture and the Act for a statement of such terms. The
Securities are general unsecured senior subordinated obligations of the Company
limited to $300,000,000 aggregate principal amount ($345,000,000 if the Initial
Purchaser (as defined in the Indenture) has elected to exercise its
over-allotment option to purchase an additional $45,000,000 of the Securities),
except as otherwise provided in the Indenture (except for Securities issued in
substitution for destroyed, mutilated, lost or stolen Securities). Terms used
herein which are defined in the Indenture have the meanings assigned to them in
the Indenture.
A-3
6. OPTIONAL REDEMPTION. The Securities will be redeemable prior
to maturity at the option of the Company, in whole or in part, at any time on or
after April 5, 2005, at the following redemption prices (expressed as
percentages of the principal amount thereof), if redeemed during the periods
commencing on the dates set forth below, in each case together with accrued and
unpaid interest to, but excluding, the redemption date:
Redemption
Date Price
----------------- ----------
April 5, 2005 101.300%
April 1, 2006 and 100.650%
thereafter
7. NOTICE OF REDEMPTION. Notice of redemption will be mailed at
least 30 days but not more than 60 days before the redemption date to each
Holder of Securities to be redeemed at its registered address. Securities in
denominations larger than $1,000 principal amount may be redeemed in part but
only in positive integral multiples of $1,000 principal amount. On and after the
redemption date interest ceases to accrue on Securities or portions of them
called for redemption.
8. REPURCHASE AT OPTION OF HOLDER. In the event of a Change in
Control with respect to the Company, then each Holder of the Securities shall
have the right, at the Holder's option, subject to the rights of the holders of
Senior Indebtedness under ARTICLE XI of the Indenture, to require the Company to
repurchase such Holder's Securities including any portion thereof which is
$1,000 in principal amount or any positive integral multiple thereof on a day
(the "REPURCHASE DATE") that is 30 business days after the date of the Change in
Control Notice, unless otherwise required by applicable law, at a price equal to
100% of the outstanding principal amount of such Security, plus accrued and
unpaid interest to, but excluding, the Repurchase Date.
Within 30 business days after the occurrence of the Change in Control,
the Company is obligated to give notice of the occurrence of such Change in
Control to each Holder. Such notice shall include, among other things, the date
by which Holder must notify the Company of such Holder's intention to exercise
the Repurchase Right and of the procedure which such Holder must follow to
exercise such right. To exercise the Repurchase Right, a Holder of Securities
must deliver on or before the close of business on the third business day
immediately preceding the Repurchase Date written notice to the Company (or an
agent designated by the Company for such purpose) and the Trustee of the
Holder's exercise of such right together with the Securities with respect to
which the right is being exercised, duly endorsed for transfer in accordance
with the provisions of the Indenture.
A-4
A "CHANGE IN CONTROL" of the Company shall be deemed to have occurred
at such time as:
(i) any "person" or "group" (as such terms are
used for purposes of Sections 13(d) and 14(d) of the Exchange
Act), other than the Company, any of its subsidiaries or any
of their respective employee benefit plans, is or becomes the
"beneficial owner" (as such term is used in Rule 13d-3 under
the Exchange Act), directly or indirectly, of 50% or more of
the voting power of the Company's Common Stock; or
(ii) the sale, lease or transfer of all or
substantially all of the assets of the Company to any
"person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Exchange Act).
However, a Change in Control will not be deemed to have occurred if
either:
(X) the last sale price of the Company's Common Stock for any five
trading days during the ten trading days immediately preceding
the Change in Control is at least equal to 105% of the then
effective conversion price on the date of Change in Control;
or
(Y) in the case of a merger or consolidation, all or substantially
all of the consideration (excluding cash payments for
fractional shares and cash payments pursuant to dissenters'
appraisal rights) in the merger or consolidation constituting
the Change in Control consists of common stock traded on a
U.S. national securities exchange or quoted on the NNM (or
which will be so traded or quoted when issued or exchanged in
connection with such Change in Control) and as a result of
such transaction or transactions the Securities become
convertible solely into such common stock and any such other
consideration.
9. CONVERSION. A Holder may convert his or her Security into
Common Stock of the Company at any time prior to the close of business on April
1, 2007, or, (x) if the Security is called for redemption by the Company, the
Holder may convert it at any time before the close of business on the business
day immediately preceding the date fixed for such redemption, or (y) if the
Security is to be repurchased by the Company pursuant to PARAGRAPH 8 hereof, the
Holder may convert it at any time before the close of business on the business
day immediately preceding the Repurchase Date. The initial conversion rate is
107.9564 shares of Common Stock per $1,000 principal amount of Securities, or an
effective initial conversion price of approximately $9.26 per share, subject to
adjustment in the event of certain circumstances as specified in the Indenture.
The Company will deliver a check in lieu of any fractional share. On conversion
no payment or adjustment for any unpaid and accrued interest, or liquidated
damages with respect to, the Securities will be made. If a Holder surrenders a
Security for conversion between the record date for the payment of interest and
the next interest payment date, such Security, when surrendered for conversion,
must be accompanied by payment of an amount equal to the interest thereon which
the registered Holder on such record date is to receive, unless the Securities
have been called for redemption as described in the Indenture.
To convert a Security, a Holder must (1) complete and sign the
Conversion Notice, with appropriate signature guarantee, on the back of the
Security, (2) surrender the Security to a
A-5
Conversion Agent, (3) furnish appropriate endorsements and transfer documents if
required by the Registrar or Conversion Agent, (4) pay the amount of interest,
if any, the Holder may be paid as provided in the last sentence of the above
paragraph and (5) pay any transfer or similar tax if required. A Holder may
convert a portion of a Security if the portion is $1,000 principal amount or a
positive integral multiple of $1,000 principal amount.
Any shares issued upon conversion of a Security shall bear the Private
Placement Legend until after the second anniversary of the later of the issue
date for the Securities and the last date on which the Company or any Affiliate
of the Company was the owner of such shares or the Security (or any predecessor
security) from which such shares were converted (or such shorter period of time
as permitted by Rule 144(k) under the Securities Act or any successor provision
thereunder) (or such longer period of time as may be required under the
Securities Act or applicable state securities laws in the Opinion of Counsel
for the Company, unless otherwise agreed by the Company and the Holder
thereof).
10. SUBORDINATION. The Securities are subordinated in right of
payment, in the manner and to the extent set forth in the Indenture, to the
prior payment in full of all Senior Indebtedness. Each Holder by accepting a
Security agrees to such subordination and authorizes the Trustee to give it
effect.
11. DENOMINATIONS, TRANSFER, EXCHANGE. The Securities are in
registered form without coupons in denominations of $1,000 principal amount and
positive integral multiples of $1,000 principal amount. The transfer of
Securities may be registered and Securities may be exchanged as provided in the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents. No service charge shall be made
for any such registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Registrar need not exchange or register the
transfer of any Security selected for redemption in whole or in part, except the
unredeemed portion of Securities to be redeemed in part. Also, it need not
exchange or register the transfer of any Securities for a period of 15 days
before the mailing of a notice of redemption of the Securities selected to be
redeemed and in certain other circumstances provided in the Indenture.
12. PERSONS DEEMED OWNERS. The registered Holder of a Security may
be treated as the owner of such Security for all purposes.
13. MERGER OR CONSOLIDATION. The Company shall not consolidate
with or merge into, or transfer or lease all or substantially all of its
properties and assets to, another person unless such other person is a
corporation organized under the laws of the United States, any State thereof or
the District of Columbia or a corporation or comparable legal entity organized
under the laws of a foreign jurisdiction and whose equity securities are listed
on a national securities exchange in the United States or authorized for
quotation on the NNM prior to or upon giving effect to the transaction (provided
however, that in the case of a transaction where the surviving entity is
organized under the laws of a foreign jurisdiction, the Company may not
consummate the transaction without first (i) making provision for the
satisfaction of its obligations to repurchase Securities following a Change in
Control, if any, and (ii) obtaining an opinion of tax counsel experienced in
such matters to the effect that, under then existing United States federal
A-6
income tax laws, there would be no material adverse tax consequences to holders
of the Securities resulting from such transaction); such person assumes by
supplemental indenture all the obligations of the Company, under the Securities
and this Indenture; and immediately after giving effect to the transaction, no
Default or Event of Default shall exist.
14. AMENDMENTS, SUPPLEMENTS AND WAIVERS. Subject to certain
exceptions, the Indenture or the Securities may be amended or supplemented with
the consent of the Holders of at least a majority in aggregate principal amount
of the Securities then outstanding, and any existing Default or Event of Default
may be waived with the consent of the Holders of a majority in aggregate
principal amount of the Securities then outstanding. Without notice to or the
consent of any Securityholder, the Indenture or the Securities may be amended or
supplemented to cure any ambiguity or inconsistency to comply with SECTIONS 5.01
and 10.12 of the Indenture, to make any changes or modifications to the
Indenture necessary in connection with the registration of the Securities under
the Securities Act and the qualification of the Indenture under the TIA, to
secure the obligations of the Company in respect of the Securities, or to add to
covenants of the Company described in the Indenture for the benefit of
Securityholders or to surrender any right or power conferred upon the Company.
15. DEFAULTS AND REMEDIES. An Event of Default includes the
occurrence of any of the following: default in payment of principal at maturity,
upon redemption or exercise of a Repurchase Right or otherwise; default for 30
days in payment of interest or other amounts due; failure by the Company for 60
days after notice to it to comply with any of its other agreements in the
Indenture or the Securities; certain payment defaults or the acceleration of
other Indebtedness of the Company and its subsidiaries and certain events of
bankruptcy or insolvency involving the Company or its Significant Subsidiaries.
If any Event of Default occurs and is continuing, the Trustee or the Holders of
at least 25% in aggregate principal amount of the Securities then outstanding
may declare all the Securities to be due and payable immediately, except as
provided in the Indenture. If an Event of Default specified in SECTION 6.01(V)
or (VI) of the Indenture with respect to the Company occurs, the principal of
and accrued interest on all the Securities shall ipso facto become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Securityholder. Securityholders may not enforce the Indenture
or the Securities except as provided in the Indenture. The Trustee may require
indemnity satisfactory to it before it enforces the Indenture or the Securities.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities then outstanding may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Securityholders notice of any continuing
Default or Event of Default (except a Default or Event of Default in payment) if
it determines that withholding notice is in the interests of the
Securityholders. The Company must furnish an annual compliance certificate to
the Trustee.
16. REGISTRATION RIGHTS. The Holders are entitled to registration
rights as set forth in the Registration Rights Agreement (as defined in the
Indenture). The Holders shall be entitled to receive liquidated damages in
certain circumstances, all as set forth in the Registration Rights Agreement.
17. TRUSTEE DEALINGS WITH THE COMPANY. The Trustee under the
Indenture, or any banking institution serving as successor Trustee thereunder,
in its individual or any other
A-7
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates, as if it were not Trustee.
18. NO RECOURSE AGAINST OTHERS. No past, present or future
director, officer, employee or stockholder, as such, of the Company shall have
any liability for any obligations of the Company under the Securities or the
Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. Each Securityholder by accepting a Security
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities.
19. AUTHENTICATION. This Security shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating agent.
20. ABBREVIATIONS. Customary abbreviations may be used in the name
of a Securityholder or an assignee, such as: TEN COM (= tenants in common), TEN
ENT (= tenants by the entirety), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A
(Uniform Gifts to Minors Act).
THE COMPANY WILL FURNISH TO ANY SECURITYHOLDER UPON WRITTEN REQUEST AND
WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO:
WebMD Corporation
669 River Drive, Center 2
Elmwood Park, New Jersey 07407-1361
Attention: Executive Vice President - Chief Financial Officer
A-8
[FORM OF ASSIGNMENT]
I or we assign to
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER
- --------------------------------
- --------------------------------------------------------------------------------
(please print or type name and address)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
the within Security and all rights thereunder, and hereby irrevocably
constitutes and appoints
- --------------------------------------------------------------------------------
Attorney to transfer the Security on the books of the Company with full power of
substitution in the premises.
Dated:
------------------------- -------------------------------------
NOTICE: The signature on this assignment
must correspond with the name as it appears
upon the face of the within Security in
every particular without alteration or
enlargement or any change whatsoever and be
guaranteed by a guarantor institution
participating in the Securities Transfer
Agents Medallion Program or in such other
guarantee program acceptable to the Trustee.
Signature Guarantee:
-----------------------------------------------------
In connection with any transfer of this Security occurring
prior to the date which is the earlier of (i) the date of the declaration by the
Commission of the effectiveness of a registration statement under the Securities
Act of 1933, as amended (the "Securities Act") covering resales of this Security
(which effectiveness shall not have been suspended or terminated at the date of
the transfer) and (ii) the Resale Restriction Termination Date, the undersigned
confirms that it has not utilized any general solicitation or general
advertising in connection with transfer:
A-9
[Check One]
(1) ____ to the Company or any subsidiary thereof; or
(2) ____ pursuant to and in compliance with Rule 144A under the
Securities Act of 1933, as amended; or
(3) ____ outside the United States to a person other than a "U.S.
person" in compliance with Rule 904 of Regulation S under the
Securities Act of 1933, as amended; or
(4) ____ pursuant to the exemption from registration provided by Rule
144 under the Securities Act of 1933, as amended; or
(5) ____ pursuant to an effective registration statement under the
Securities Act of 1933, as amended.
and unless the box below is checked, the undersigned confirms that such Security
is not being transferred to an "affiliate" of the Company as defined in Rule 144
under the Securities Act of 1933, as amended (an "Affiliate"):
[ ] The transferee is an Affiliate of the Company. (If the
Security is transferred to an Affiliate, the restrictive legend must remain on
the Security for two years following the date of the transfer).
Unless one of the items is checked, the Trustee will refuse to
register any of the Securities evidenced by this certificate in the name of any
person other than the registered Holder thereof; provided, however, that if item
(4) or (5) is checked, the Company or the Trustee may require, prior to
registering any such transfer of the Securities, in their sole discretion, such
written legal opinions, certifications and other information as the Trustee or
the Company have reasonably requested to confirm that such transfer is being
made pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act of 1933, as amended.
If none of the foregoing items are checked, the Trustee or
Registrar shall not be obligated to register this Security in the name of any
person other than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in SECTION 2.16 of the Indenture
shall have been satisfied.
Dated: Signed:
----------------------------- ----------------------------------
(Sign exactly as name appears on
the other side of this Security)
Signature Guarantee:
------------------------------------------------------------
A-10
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing
this Security for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act of 1933, as amended, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as the undersigned has requested pursuant to
Rule 144A or has determined transferor is relying upon the undersigned's
foregoing representations in order to claim the exemption from registration
provided by Rule 144A.
Dated:
---------------------- ----------------------------------------------
NOTICE: To be executed by an executive officer
A-11
CONVERSION NOTICE
To convert this Security into Common Stock of the, check the box: [ ]
To convert only part of this Security, state the principal amount to be
converted (must be in multiples of $1,000):
$____________
If you want the stock certificate made out in another person's name, fill in the
form below:
- --------------------------------------------------------------------------------
(Insert other person's soc. sec. or tax I.D. no.)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Print or type other person's name, address and zip code)
- --------------------------------------------------------------------------------
Date: Signature(s):
------------------ -----------------------------------------
(Sign exactly as your name(s) appear(s)
on the other side of this Security)
Signature(s) guaranteed by:
-----------------------------------------------------
(All signatures must be guaranteed by a guarantor
institution participating in the Securities Transfer
Agents Medallion Program or in such other guarantee
program acceptable to the Trustee.)
A-12
OPTION OF HOLDER TO ELECT PURCHASE NOTICE
Certificate No. of Security: ___________
If you want to elect to have this Security purchased by the pursuant to
SECTION 3.08 of the Indenture, check the box: [ ]
If you want to elect to have only part of this Security purchased by
the Company pursuant to SECTION 3.08 of the Indenture, state the principal
amount:
$_______________________________________
(in an integral multiple of $1,000)
Date: Signature(s):
---------------------- ------------------------------------
-------------------------------------------------
(Sign exactly as your name(s) appear(s) on the
other side of this Security)
Signature(s) guaranteed by:
-----------------------------------------------------
(All signatures must be guaranteed by a guarantor
institution participating in the Securities Transfer
Agents Medallion Program or in such other guarantee
program acceptable to the Trustee.)
A-13
SCHEDULE A
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL SECURITY(a).
The following exchanges of a part of this Global Security for an
interest in another Global Security or for Securities in certificated form, have
been made:
Principal amount of
Amount of decrease Amount of increase in this Global Signature or
in Principal amount Principal amount of Security following authorized signatory
of this Global this Global Security such decrease of Trustee or Note
Date of Exchange Security (or increase) Custodian
- ---------------
(a) This is included in Global Notes only.
EXHIBIT B-1
FORM OF PRIVATE PLACEMENT LEGEND
THIS SECURITY AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS
SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION
HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER:
(1) REPRESENTS THAT:
(A) IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A "QUALIFIED
INSTITUTIONAL BUYER" (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT)
AND THAT IT EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH
ACCOUNT; OR
(B) IT IS NOT A U.S. PERSON (WITHIN THE MEANING OF REGULATION S
UNDER THE SECURITIES ACT),
(2) AGREES THAT IT WILL NOT DIRECTLY OR INDIRECTLY ENGAGE IN ANY
HEDGING TRANSACTIONS INVOLVING THIS SECURITY OR THE COMMON STOCK ISSUABLE UPON
CONVERSION OF THIS SECURITY UNLESS IN COMPLIANCE WITH THE SECURITIES ACT, AND
(3) AGREES FOR THE BENEFIT OF THE COMPANY THAT IT WILL NOT OFFER,
SELL, PLEDGE OR OTHERWISE TRANSFER THIS SECURITY OR ANY BENEFICIAL INTEREST
HEREIN, PRIOR TO THE DATE THAT IS THE LATER OF (X) TWO YEARS AFTER THE LATER OF
THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF
THIS SECURITY) OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(K) UNDER
THE SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER, AND (Y) SUCH LATER
DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAW, EXCEPT ONLY:
(A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF;
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME
EFFECTIVE UNDER THE SECURITIES ACT;
(C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE
144A UNDER THE SECURITIES ACT;
(D) IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 OF
REGULATION S UNDER THE SECURITIES ACT; OR
(E) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE
144 UNDER THE SECURITIES ACT.
B-1-1
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (3)(C) OR
(D) ABOVE, A DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM OF WHICH MAY BE
OBTAINED FROM THE TRUSTEE) MUST BE DELIVERED TO THE TRUSTEE. PRIOR TO THE
REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (3)(E) ABOVE, THE COMPANY AND
THE TRUSTEE RESERVE THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS,
CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO
DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE
SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE
AS TO THE AVAILABILITY OF ANY EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT.
B-1-2
EXHIBIT B-2
FORM OF LEGEND FOR GLOBAL SECURITY
Any Global Security authenticated and delivered hereunder shall bear a
legend (which would be in addition to any other legends required in the case of
a Restricted Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE
MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A
DEPOSITARY OR A SUCCESSOR DEPOSITARY. THIS SECURITY IS NOT
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A
PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO
TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS
SECURITY AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED
TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE &
CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND
TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN SECTION 2.16 OF THE INDENTURE.
B-2-1
EXHIBIT D-1
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
The Bank of New York
101 Barclay Street, Floor 21W
New York, NY 10286
(212) 896-7298
Attention: Corporate Trust Administration
Re: WEBMD CORPORATION (the "COMPANY") 3 1/4% Convertible
Subordinated Notes due 2007 (the "SECURITIES")
Ladies and Gentlemen:
In connection with our proposed sale of $_________ aggregate principal
amount of the Securities, we confirm that such sale has been effected pursuant
to and in accordance with Regulation S under the U.S. Securities Act of 1933, as
amended (the "SECURITIES ACT"), and, accordingly, we represent that:
(1) the offer of the Securities was made in an
"offshore transaction" to a person other than a "U.S. person"
(as defined in Regulation S);
(2) either (a) at the time the buy offer was
originated, the transferee was outside the United States or
we and any person acting on our behalf reasonably believed
that the transferee was outside the United States, or (b) the
transaction was executed in, on or through the facilities of
a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction
has been pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made
in the United States in contravention of the requirements of
Rule 903(b) or Rule 904(b) of Regulation S, as applicable;
(4) the transaction is not part of a plan or
scheme to evade the registration requirements of the
Securities Act;
(5) we have advised the transferee of the
transfer restrictions applicable to the Securities; and
(6) if we are a dealer in securities or have
received a selling concession, fee or other remuneration in
respect of the Securities, and the
D-1-1
transfer is to occur during the Restricted Period, then the
requirements of Rule 904(c)(1) have been satisfied.
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You, the Company and counsel for the Company are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby. Terms used in this
certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By:
--------------------------------------
Authorized Signature
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EXHIBIT D-2
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
The Bank of New York
101 Barclay Street, Floor 21W
New York, NY 10286
(212) 896-7298
Attention: Corporate Trust Administration
Re: WEBMD CORPORATION (the "COMPANY") 3 1/4% Convertible
Subordinated Notes due 2007 (the "SECURITIES")
Ladies and Gentlemen:
In connection with our proposed purchase of $_________ aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the U.S. Securities Act of
1933, as amended (the "SECURITIES ACT"), and, accordingly, we represent that:
(1) the undersigned is not a U.S. person (as
defined in Regulation S) and has not acquired the Securities
for the account or benefit of any U.S. person;
(2) the undersigned is not a distributor within
the meaning of Regulation S; and
(3) the undersigned agrees to resell the
Securities only in accordance with the provisions of
Regulation S, pursuant to registration under the Securities
Act, or pursuant to an exemption from registration and agrees
not to engage in hedging transactions with regard to the
Securities unless in compliance with the Securities Act.
You, the Company and counsel for the Company are entitled to rely upon
this letter and are irrevocably authorized to produce this letter or a copy
hereof to any interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby. Terms used in this
certificate have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferee]
By:
--------------------------------------
Authorized Signature
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EXHIBIT E
Form of Notice of Transfer Pursuant to Registration Statement
WebMD Corporation
669 River Drive, Center 2
Elmwood Park, New Jersey 07407-1361
Attention: Executive Vice President - Chief Financial Officer
The Bank of New York
101 Barclay Street, Floor 21W
New York, NY 10286
(212) 896-7298
Attention: Corporate Trust Administration
Re: WEBMD CORPORATION (the "COMPANY") 3 1/4% Convertible
Subordinated Notes due 2007 (the "SECURITIES")
Ladies and Gentlemen:
Please be advised that _____________ has transferred $___________
aggregate principal amount of the Securities or __ shares of the Common Stock,
$0.001 par value per share, of the Company issuable on conversion of the
Securities ("STOCK") pursuant to an effective Shelf Registration Statement on
Form S-3 (File No. 333-________).
We hereby certify that the prospectus delivery requirements, if any, of
the Securities Act of 1933 as amended, have been satisfied with respect to the
transfer described above and that the above-named beneficial owner of the
Securities or Stock is named as a "SELLING SECURITY HOLDER" in the Prospectus
dated _________, or in amendments or supplements thereto, and that the aggregate
principal amount of the Securities, or number of shares of Stock transferred are
[a portion of] the Securities or Stock listed in such Prospectus, as amended or
supplemented, opposite such owner's name.
Very truly yours,
----------------------------
(Name)
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EXHIBIT F
Form of Opinion of Counsel in Connection with Registration of Securities
The Bank of New York
101 Barclay Street, Floor 21W
New York, NY 10286
(212) 896-7298
Attention: Corporate Trust Administration
Re: WEBMD CORPORATION (the "COMPANY") 3 1/4% Convertible
Subordinated Notes due 2007 (the "SECURITIES")
Ladies and Gentlemen:
Reference is made to the Securities issued pursuant to a certain
indenture dated as of April 1, 2002 by and between the Company and The Bank of
New York, as trustee (the "TRUSTEE"). The Company issued $300,000,000 principal
amount of Securities on April 1, 2002 [and an additional $45,000,000 on
________, 2002 [IF THE INITIAL PURCHASER'S OVERALLOTMENT OPTION IS EXERCISED]]
in transactions exempt from registration under the Securities Act of 1933, as
amended (the "SECURITIES ACT"). The Company has filed with the Securities and
Exchange Commission (the "SEC") a registration statement on Form S-3 (File No.
333-____) (the "REGISTRATION STATEMENT") relating to the registration under the
Securities Act of $______________ principal amount of the Securities and the
shares of Common Stock of the Company (the "SHARES") issuable upon conversion of
the Securities being registered. The Registration Statement was declared
effective by order of the SEC dated [_____________].
We have acted as counsel for the Company in connection with the
issuance of the Securities and the preparation and filing of the Registration
Statement and are familiar with the Securities, the Indenture, the Registration
Statement, the above-mentioned SEC order and such other documents as are
necessary to render this opinion.
Based on the foregoing, it is our opinion that (1) the Registration
Statement has become effective under the Securities Act and, to our knowledge,
no stop order suspending the effectiveness of the Registration Statement has
been issued, (2) assuming that the Securities covered by the Registration
Statement and the Shares issuable upon conversion of such Securities are sold by
a relevant Holder specified in the Registration Statement in a manner specified
in the Registration Statement, such sale of the Securities and Shares issuable
upon conversion of the Securities will have been duly registered under the
Securities Act and (3) the Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended.
Yours truly,
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